Warning: what you are about to read is more or less a rant on entrepreneurship, wantrepreneurship, and my current thoughts on life.
5:00 AM, August 2nd, 2017 – Alarm ringing, sun not quite over the horizon, I woke up in a slight daze. Time to get to work on my side hustles before heading off to work around 8!
Yesterday, my business partner and I started packaging up the 19 kombucha tea subscription kits that were ordered through our kombucha kit website and the Kickstarter we successfully completed. These 19 kits represented roughly $900 in sales. While $900 in sales in the first 3 months is pretty good for a new business, I have a lot of thoughts on the subject as I’m frustrated, happy, and reflective all in the same moment.
Below are my thoughts on physical products, government entities, planning, taking action, and work.
Why Physical Products Suck
Why do physical products suck? Time, money, regulations, shipping and digital products.
Physical Products Suck Because of Time
I woke up at 5 AM today and struggled with boxing tape and labels for 2 hours. I finally got all of the boxes ready to go. Yesterday, I spent about 5 hours doing various things: getting the boxes ready, picking up bubble wrap, and putting the jars and ingredients in to the boxes. We only had 19 boxes to ship out – while this was our first time shipping the kits, 7 hours is a lot of time. We will get better, but as time goes on, if we need to fill orders of 100 kits, that will take full days…
Add on the 5 hours we spent at the commercial kitchen, and the endless hours of getting to this stage, this has been a time consuming endeavor.
Physical Products Suck Because of Money
It cost us $295 to buy 9 lbs of dried strawberries. It costs us $30-40 to make one of these kombucha kits because we are still tweaking the process. To make $100 in profit, we need to spend $300-400. This is a decent deal, but could be better.
Physical Products Suck Because of Regulations
For the kombucha kit, we needed to get into a commercial kitchen. To do so, I needed to get certified in food safety and get a license to handle and sell food. We needed to have appropriate labels to comply with food law regulations. Most other physical products have regulations as well.
Physical Products Suck Because of Shipping
Once I get my products complete and sold, now I have to ship it to you. I have to consider the safety of the person receiving my product and the safety of the product. Bubble wrap, wrapping paper, boxes, tape, shipping labels – it all adds up to a lot of time and money.
Physical Products Suck Because Digital Products are Better
Do digital products take a lot of money to make? No – a simple internet connection and Microsoft Word would do the trick for an ebook. Do digital products take a lot of time to make? At first, yes, but in the long run, no. Do digital products require the creator to meet regulations? Sometimes, but usually not very restrictive ones. Do digital products need to be shipped? Nope! Email and file transfer baby! Conclusion: digital products are better.
A Conclusion on Government Entities (USPS is the best, but still horrible)
I’ll start off by saying most generalizations are false (see what I did there). Then I’ll continue: most government entities are incompetent. Why do I say this? I tried printing off 19 labels for the boxes and when it came time to pay, the website would not accept my payment. Here’s the best thing though.. I’ll just let it sit here:
WHAT’S GOING ON HERE??? So you are telling me the payment goes through, but for some reason it can’t complete it, and so then you refund it? What kind of incompetent programmers do you have? I googled this issue and it’s been occurring since 2010. Why hasn’t this been fixed? No one knows…
Though, I’m very happy that it isn’t going to cost me $58 to ship a 4 lb package to Alaska (cough, UPS), but come on! Ugh, guess I’ll have to wait in line at USPS to get this done.
Overestimate Time, Money, and Yourself (read: Overestimate Everything)
We wanted to get these kombucha subscription kits out at the end of June. Then reality hit: food safety laws are a thing and we needed to get into a commercial kitchen. Over the past 2 months, I’ve became a Certified Food Manager, got a Retail Food Handler’s license, and got into the commercial kitchen to package up goods. Looking at this, I’d say it was a success and the hard parts are behind us. My point here, is overestimate the time to bring your product to the market…
Which brings me to my next point (and follows from my previous section on USPS): overestimate the amount of money you will need to spend on various things. $261 to do priority mailing for 19 things? $20 for a 4 lb package to Alaska? $89 for food labels? $731 for LLC registration? $494 for a trademark? $137 for the kitchen rental? It all adds up.
In my introduction to HOWLinfuse Kombucha post, I laid out the potential profit for each box.
|One gallon FDA-certified glass open mouth fermentation container||$3.40|
|1 Healthy SCOBY and Starter Liquid for Fermentation||$8.50|
|4 Oz Organic Green or Black Tea||$1.90|
|Imported Hawaiian Turbinado Sugar||$0.65|
|Delicate Dried Fruits For Sweetening||$4.70|
|12″x12″ Fine Cotton Cloth and Band for Fermentation||$0.80|
|Box to ship in||$0.88|
|Choices of Herbs and Flowers for Tastes||$2.95|
This looks fine and dandy, until we actually did the whole thing. I need to compile the numbers, but I think our box will cost closer to $40 because of shipping and production costs.
My point here is something can look great on paper in theory, but in reality, costs add up, and what you thought would be a profit, isn’t that great anymore (This goes back to my first point on physical products sucking!!)
While there have been some disappointments in the time and money areas, for me, I’m very pleased with what I’ve been able to accomplish. What about yourself? You can do all this too. Be confident in yourself. We underestimate what we can do because of confidence reasons. Overestimate what you can do in a few months – you’ll surprise yourself! 🙂
A Brief Note on Wantrepreneurship
My roommate asked me the over week, “So, how’s the thing with Jake going? Are you just kind of planning things out, or what?” My reaction internally was “WTF? Planning? Who do you think I am? I take action dude.” I composed myself and said, “Oh, no, we are doing stuff. We have sales and we are shipping out the first boxes at the end of the month.”
Before I rant real quick, first, a definition:
Wantrepreneur : noun : A Wannabe Entrepreneur
You want to be an entrepreneur? Stop researching. Stop planning. Start Doing. I’ve learned more in the last 3 months than I ever did “researching” by “reading articles” or “watching videos”. I’m a Certified Food Safety Manager for crying out loud – the business paid $84 for me to get training and now I’m certified. It took about 16 hours of education and I did it. Am I a food expert? No. Am I a foodie? Not really. Am I determined to get stuff done? Yes.
For you, build a website, start a blog, do something. Try to sell stuff to people, network. It’s really not that hard to start doing.
I think a lot of people who want to get started think they have to have the perfect idea. Guess what? Ideas don’t mean anything – the best idea and no or horrible execution is worth about $0, give or take. For any wantrepreneurs out there, and you know who you are, take action today.
Do Something to Work Towards Your Goals EVERY DAY
Turn Simple Daily Disciplines into Massive Success & Happiness – The Slight Edge
Why am I going to the post office in about an hour to drop off 19 subscription kits? I took action. BUT, it wasn’t enough to do it just one time – I’ve woken up each and every day and said to myself, “Okay, what’s the next step, what can I learn, what can I do, how can we push this forward?” Like I mentioned above, we overestimate what we can do in 1 day, and underestimate what we can do in 1 month. My business may be in the red right now, and I don’t even know if we will continue to get sales, but one thing I do know is I’m much more mature as a person than I was 3 months ago, I understand the difficulties of running a business, and I really haven’t even gotten started yet.
As we learned in The Slight Edge, you are in complete control of your life. What are your goals? Write them down and work at least 15 minutes each day on them. Do you want to lose 20 lbs? Walk at least 15 minutes a day. Do you want to become rich? Make it a daily habit to review your financials and track your income and expenses. What about getting a promotion at work? Spend at least 15 minutes reviewing relevant news in your industry and learn something new about your workplace.
It’s not rocket science – consistent effort over time leads to big results. Get out there, do it, and do it every day.
Well that was fun. I started this post at 7:02 AM and it’s now 7:59 AM, just in time to get sent off by MailChimp to you, my reader. I hope you enjoyed the post and let me know in the comments if you have similar or different thoughts on any of the points I made above.
Off to the post office!