#LBCWantsToKnow >> November 2018: Small Business Owner Mindset

LuckyBreak-LBCWantsToKnow-Mindset

Small Business Owner Mindset

 

Each month, I ask my Instagram community to join me in a focused, crowd-sourced discussion on a specific subject.  For the month of November, we rolled up our sleeves to chat about small business owner mindset. Nobody understands the stress of the holiday season like a small business owner, and I was thrilled to see so many Lucky Break Clients sharing their thoughts and experiences.

 

Nov18QA

 

THE LUCKY BREAK COMMUNITY SAID…

  • bodysystemsteri: It’s so essential. And I feel as entrepreneurs we don’t take notice till it’s too late.
  • zirafkahanka: For me these three come first: SLEEP, EAT, MOVE. Then anything else. To start to look at my life this way helped me tremendously last year.
  • printtherapy: I have to make the time. I’ve burnt out so many times emotionally and physically that I now really understand the importance of self care. For me it’s good sleep, healthy eating, and working out. It’s also time alone and Netflix binges 🙂 Either I spend time taking care of myself, or I spend the time being tired and anxious and therefore unproductive.

 

MY THOUGHTS:

Overwhelm and burnout are, unfortunately, rampant in the entrepreneurial community.  While everyone’s coo’ing over four-hour work weeks and how sexy it is to be at the helm of your own ship, what they’re not often talking about is how we often work 60-80 hour work weeks and how we sometimes sag under the weight of long to-do lists and massive responsibilities.  I don’t mean to be Debbie Downer, but we’re all about “real life” business here at Lucky Break and that’s the reality for many of us.  But as someone who’s hit her brick wall more than once, I’ve learned the importance of self-care.  A few tips I’ve picked up along the way…

  1. Put your own oxygen mask on first. The LBC Community is made up primarily of women and we often put ourselves last, taking care of ourselves only after everyone else has been tended to. But you can’t pour from am empty cup and I’ve learned to move myself up in line so that I can be a healthy resource for those who depend on me.

 

  1. Business ebbs and flows. There are times in each of my businesses when I’ve needed to let off the gas a bit to tend to my own health o r the wellness of my family.  Keeping the gas pedal pressed all the way to the floor 24/7 is an impossible ask, so flexibility is key. Recognizing that there are seasons for big launches and concerted waves of outreach, and the development of new collaborations has been key, because there are also seasons for pulling back and conserving energy. Yin and yang and all that jazz.

 

  1. When I feel myself breathing up against a brick wall, a change of energy is needed. Think of it as an intervention: work half-time in your business next week. Go to bed an hour earlier every day this week. Find one thing from your to-do list that you can delegate to someone else. Being attuned to yourself and proactive about your own wellness is much easier than picking up the pieces after you’ve slammed into the wall and everything has shattered.

 

 

Nov18QA4

 

THE LUCKY BREAK COMMUNITY SAID…

  • a_wildflower_gypsy: Meditate and clear my mind out in nature, phone free. Quiets the chaos and allows ideas to flow.
  • zhibathandbody: I clean… something about putting on my sneakers, cleaning house, and burning sage gets my juices flowing. I find myself away from those things that have my mind cluttered.
  • mistybluebotanicals: I like to FB and insta-stalk creative people I admire. Instagram, in particular, is hard for me because I don’t feel particularly talented in the creativity department, so I like to see what other folks are doing visually. Somewhere taking a ride somewhere news helps to unblock creativity for me.
  • pearlglow_bodybutter_and_soap: I like to look at things I love, read, or start at the beginning. I’ll go back to some of the first things I created or wrote, this always helps.

 

MY THOUGHTS:

I second all of these awesome suggestions! One thing I’ve learned in fifteen years  of being a full-time entrepreneur: pushing through roadblocks rarely helps. When I’ve reached my breaking point, the best thing that I can do is redirect my energy.  Whether that’s cooking a good meal, taking the dog for a walk, calling a good friend, or soaking in a hot bath- anything I can do to change my current paradigm and replenish energy levels before diving back in proves beneficial. Throwing good energy after bad is rarely successful. But it’s also very necessary to dive back in. So take heart, walk off the ship for a bit, but don’t abandon the ship entirely.

 

(more…)

#LBCWantsToKnow >> September 2018: Websites

LuckyBreak-LBCWantsToKnow-Websites

LuckyBreak-LBCWantsToKnow-Websites

 

Each month, I ask my Instagram community to join me in a focused, crowd-sourced discussion on a specific subject.  For the month of September, we rolled up our sleeves to chat about websites. Your own website is one of the most critical tools in your entrepreneurial toolboxes + I’m thrilled to see so many Lucky Break clients putting theirs to good use.

 

 

Which e-commerce platform do you use? What do you loathe or love about it?

THE LUCKY BREAK COMMUNITY SAID…

bburford:  at Bang Candy we have used many of the platforms you’ve mentioned and moved around for various reasons. Shortly after I joined the brand last year we started working with an incredible local brand called CoHub that brought all channels of our business together. I don’t know if it would work well for you, but for me it’s great because I’m talking to a support team that is 10-15 minutes away from our shop. It makes my job slightly easier to maintain.

horsefeathersgifts: We’ve used many different platforms and Shopify is by far my favorite. It’s so user friendly!

valerieoba: Shopify is simply amazing. So user friendly and so detailed at the same time!

alliedattilio: Love Squarespace!

normalsoap: We get tickled every time we get to tell our customers our website. Shopify has made this wonderful and it’s helped with direct sales at markets, getting great sales data and tracking inventory!

ebornbeauty: We use Big Commerce and love it… many things like reporting, integration with Square and Paypal, etc are included and you do not need to pay for additional apps. Their customer service is stellar and 24/7.

woodenheartdesigns: I’ve been an Etsy seller since 2012 with my personal website forwarding to my Etsy shop. After reading something you wrote about how important it was to have your own e-commerce site, I signed up for Shopify and have been teaching myself how to tweak it and now trying to increase traffic. I love how it’s coming together and have found it pretty easy to use…and if I didn’t know or understand how to do something it’s easy to find tutorials. Thanks for the nudge to get my own shop vs just Etsy!

shopmilked: From Wix, to Shopify! I love that Wix allowed me to tweak my site, and make it incredibly beautiful without the added fee for a theme. But ultimately, I moved to Shopify for the integrated customers accounts, shipping and reporting. I do dislike the fact that Shopify still doesn’t have certain features like store pickup, or customer reviews, or more free theme options.

bubblebabez: Big commerce here, too.

sheabath: Went from Etsy to Indiemade. Best decision I ever made!

bougiequaintrelle: BigCommerce. I like the ease of use. I loathe the fact if you want to make further customization, you lose tech support.

stellachroma: Started with Etsy, moved to Big Cartel, and am currently with Shopify. I’m loving it with no complaints!

grayzenacres: I’m a Shopify convert. Love the support and apps…not fond of their payment gateway. When I installed my bank processor, Shopify added a 2% processing fee, needless to say I uninstalled bank processor otherwise it’s the best!

zhibathandbody: I’ve been with Weebly for 10 or so years now. LOVE that so many cool features come with the free and paid accounts. Love that they listen to the users on adding new features. LOATHE that those features take so long to implement. LOATHE that they now seem to nickel and dime you on advanced features and services.

makermountainfabrics: I use Shopify and love it, mostly. I do NOT love their calculated shipping as it is way overcharging and I am losing a lot of sales over it right now and need to get it in line.

sumamsworld: I love Shopify for its one-stop-shop convenience, but the shipping charges are super huge lately (like triple the actual cost if I took it to the Post Office).

pillowcandyllc: We use Shopify. I made this decision after going through your linesheet/wholesale training. So glad I did!

 

MY THOUGHTS…

The answers above are pretty consistent with what I see reflected in my client base as a whole. Shopify is the most beloved platform among my roster of product-based brands. A distant second and third are Squarespace and Big Commerce.

 

I’m a big (unpaid) advocate of Shopify and recommend it almost universally. It’s not as easy to design as something like Wix, but the design capabilities- and (more importantly) the technical capabilities- leave platforms like Wix and Weebly in the dust. Shopify is fairly cost-effective, extremely robust, and highly adaptable.  If online wholesale ordering isn’t a primary aim of your business, then Squarespace and Big Commerce might be good options.

 

I wrote a detailed, two-part review of the most popular platforms a year or two ago and my opinion hasn’t changed much since then.  Check out Which E-commerce Platform is Right For You? and Which E-commerce Platform is right For You, Part 2. I can tell you this: when you update from Wix, Weebly, or WooCommerce to Shopify, you’re going to feel like upgraded from a Ford Focus to a Ferrari. You truly don’t know what type of functionality you’re missing (or how your current technology might be hamstringing your sales and operations) until you see how the other half lives.

 

PRO TIP: Many of my clients report that Shopify will throw in the real-time shipping for free if you agree to pre-pay the Shopify site fees for the first year. If that appeals to you, then reach out to them directly and sweet-talk your way into a deal!

 

Do you offer a “loyalty” program via your website? If so, what program do you use + would you recommend it?

THE LUCKY BREAK COMMUNITY SAID…

dorneenaturalbodyluxuries: I need to set up an actual program.

stellachroma: Interested to hear about this!

doubleclutched: I use smile.io on my site but no one uses it.

bobodesignstudio: I just saw smile.io is an integration with Privy which is what I use! I haven’t looked into it yet, but I’m curious.

priiacosmetics: We use a VIP points program. Customers earn 1 VIP point for every dollar they spend. 10 VIP points is equal to $1 in savings off of future purchases. Our clients LOVE our program!

 

MY THOUGHTS…

I L-O-V-E loyalty programs and it’s one of the things we dissect in Brick House Branding. Why? Because they encourage repeat customers. They can blissfully easy to manage thanks to new technology. And they can allow you to reward your best customers without getting into a pricing war with your wholesale stockists.  I adore a good win-win-win.

 

Big Commerce wrote a deliciously detailed blog about customer loyalty programs that’s absolutely worth a read. Shopify recently published a robust, data-driven blog that certainly makes the case for rewarding your customers while Smile.io dissects some popular loyalty programs to get at the heart of why they work. Speaking of Smile.io, I hear good things about their loyalty technology, which is compatible with Shopify, Shopify Plus, and Big Commerce. They offer a stripped-down, completely free version, too.

 

Loyalty programs need to be continually promoted in order for them to be successful. Tuck periodic reminders in your email marketing campaigns, add verbiage at checkout to invite customers to join, and feature the account login prominently on your website. Mention that program at least once per month on your social media, too. The effort can yield massive results.

 

One new evolution I’ve been keeping an eye on? Paid VIP memberships.  Check out what wildly popular shoe company Freshly Picked is doing with their new program, The Fringe.  Customers join for $10 a month (the plan can be cancelled at any time) and they enjoy: a $10 monthly store credit that doesn’t expire, 20% off everything sitewide, free shipping, and early access to new releases. Ca-ching!

 

Do you collect product reviews on your website? If so, which software do you use + would you recommend it?

THE LUCKY BREAK COMMUNITY SAID… 

bobodesignstudio: I do, but I struggle to get people to actually leave one! The one I have is an app from Shopify called “product reviews”… innovative name, I know.

herbanrootsllc: The product reviews app with Shopify is awesome! Customizable, automated emails after every purchase, free and paid options. I also send out a pretty printed piece with every order listing ways that customers can connect, including writing reviews.

halfpintnaturals: Yotpo app on Shopify.

urbanessencesalonspa: I have a hard time getting folks to actually leave a review. I use AmeriCommerce for my website and after a customer makes a purchase it sends out a review request in about 10 days. When I see customers out at vending event I ask them to leave a review and they always end up leaving the review on my Facebook page.

treats4chickens: We have used Yotpo for several years on a paid plan. I include small pre-printed note card letting people know they’re going to get an email asking for a review. I also select one review a month and send that person product freebies. It seems to be working quite well.

 

MY THOUGHTS…

Product reviews are increasingly powerful tools that play a large role in converting eCommerce browsers into eCommerce customers. They serve as powerful social proof that either ignites interest or throw a bucket of water on it, depending on what’s said about your product. If Amazon, Yelp, and Google have taught us anything, it’s that customers look before they leap.

 

I’m a firm believer that product reviews are an absolute *must* on any eCommerce site. As brand owners, we need to provide a platform for reviews, respond to reviews which are less-than-flattering, and actively invite our customers to participate in the process. The unboxing experience should proactively promote customer reviews.. a simple reminder in that key moment can make all the difference. And it’s much less intrusive then repeated post-purchase emails reminding customers that they’ve yet to read a review.

 

Interested in getting a product review program going? Here are a few of my favorite resources…

  • Need inspiration? Lucky Break Clients Leahlani Skincare and Osmia Organics both do a fantastic job of collecting and featuring customer reviews.
  • Yotpo is the third-party review app that I hear the most consistently good things about.
  • I recommend two books that have helped me both understand the importance of critical feedback and better navigate these tricky customer service waters. Check out Hug Your Haters and Zombie Loyalists.

 

 

What’s your #1 pet peeve when shopping from product-based websites? What one thing would you change about your website?

THE LUCKY BREAK COMMUNITY SAID… 

north.oak.apothcary: When I have to jump through too many hoops to get to the end.

bathedinglaze: I visited a website just yesterday to order a gift. The banner at the top of the page advertised free shipping. When I checked out, shipping was charged. Looking further into the page to see if I could contact someone, I came across their info page that had words spelled wrong and run-on sentences. It turned me off, and I left their site without ordering.

mistybluebotanicals: I hate having to click through too many pages to find what I am looking for.

theryssa: Zulily makes you sign up to just look around. I won’t do it on principle!

mysecretmusicbox: I really dislike having to enter my shipping address etc. more than once and having to click through more than one page to complete a purchase. If they could make the journey through those pages a little more entertaining or charming it would help a lot. Great food for thought!

 

MY THOUGHTS…

All the amen’s to these answers! Typos on websites don’t inspire confidence.  Missing contact information is the kiss of death for most shoppers. A lack of search functionality, fuzzy navigation, or illogical product categories are laborious and drain energy, slowing conversions except for the most committed of shoppers.

 

The checkout process, in particular, routinely drives potential buyers away. A few questions you can ask yourself to audit your own checkout process:

  • If the entire checkout process can’t be completed on one screen, is there a progress
    bar at the top of each checkout page so that buyers always know where they are in the process?
  • If a “free shipping over x dollars” incentive is offered, does the cart reflect how much more must be spent in order to meet the necessary minimum to score the incentive?
  • Can payments be completed on site or must they be sent off to a third party site like PayPal?
  • Are multiple payment options available?
  • Are customers able to check out without needing to create an account on the site?
  • Is there an option for hurried customers to copy their “billing address” information over to the “shipping address” field to save time?
  • Are any unnecessary main navigation links removed during the checkout process to keep the user moving forward with their purchase?

 

JOIN THE CONVERSATION

Be sure to stop by the Lucky Break Instagram, where every month we chat about all things business. I’d love to hear your thoughts and hope you’ll lend your voice. Search the #LBCWantstToKnow hashtag to weigh in! In October, we’re chatting about all things systems.

 

#LBCWantsToKnow >> August 2018: Wholesale

LuckyBreak-LBCWantsToKnow-Wholesale

#LBCWantsToKnow Wholesale

 

Each month, I ask my Instagram community to join me in a focused, crowd-sourced discussion on a specific subject.  For the month of August, we rolled up our sleeves to chat about wholesale. If you’re serious about getting a foot in the door with shops for the all-important holiday season, then August is the month to make that happen!

 

What’s the one thing about wholesale that you wish you’d known when you started?

THE LUCKY BREAK COMMUNITY SAID: 

whitneymanney: Net terms

 

bathedinglaze: The true cost of obtaining a retail customer versus wholesale customer.

 

mamasudsllc: How much I needed to raise my prices to make 💰

 

rockcreeksoaps: How important it is to build a relationship with my wholesale accounts and maintaining good contact and follow up with them. Also never be afraid to contact an account, they get busy, and won’t remember to order until it’s too late, and then they might shop around instead of stocking with you again!

 

standardwax: How hard it is to be nimble or make changes when you have 300 buyers counting on your consistency!

 

sassypantsdesign: Uhhh, Lucky Break! 👍💓🙏🏻🙌

 

MY THOUGHTS: These are some juuuuicy answers that had me nodding my head! I’ll weigh in quickly on each one.

 

  • Net terms can be immensely tricky for newer makers, and I’ve learned that 90% of problems can be prevented on the front end by communicating professionalism, having strong systems in place, and not shying away from things like checking references before extending credit and sending payment reminders when the due date passes. Many of us are uncomfortable with money discussions, but I’ve found that buyers follow the tone we set and we need to start of on strong footing… much easier than trying to prepare things on the back end. Also, not every brand owner is in a position to offer trade credit, though buyers love those who can!

 

  • The cost of obtaining a retail customer is generally higher than that of obtaining a wholesale customer, and the lifetime value (total dollars spent) by a wholesale customer is much, much higher. This is an often overlooked facet when clients ask me why on earth they’d sell their wares at “half the normal cost.” The fact is, selling at wholesale produces efficiencies in creation and shipment that drive costs lower, which means that it cost less to make and ship a wholesale product versus the same product sold at retail. So while you are selling at “half” ($24 retail, versus $12 wholesale), your profits aren’t exactly halved. Add in the higher customer acquisition cost and lower lifetime value of a retail customer, and wholesale looks more and more attractive.

 

  • It’s true that selling in wholesale means that you need to know your costs intimately. While you might be able to eek by in direct-to-consumer channels without knowing where every penny goes, wholesale won’t provide you that luxury. Lucky Break clients frequently engage me to help further their brand development and raise the bar on their visual presentation, increasing the quality of their value communication in the process.  The end result? You can charge more for your products and put wholesale within reach.

 

  • Wholesale buyers often tell me that we pursue them like lovers until we get that first order, then we vanish like ghosts. Regular followup is *essential*, which is why I recommend both group communication (vis a vis a quarterly wholesale email campaign) and individual communication (emailing the account individually to check on stock and see how you can help). Getting that first order is hard, but the second and third orders should be much, much easier. Don’t ghost your buyers and allow those accounts to shrivel. You’ve worked hard to get the seed into the ground, and regular watering will yield big results!

 

  • There’s an important pivot that happens when transitioning from hobby-business to business-business. The primary focus shifts from the making to the marketing and production, which can catch many product designers off guard. It’s awesome to have a robust lineup of stores carrying your work, but that also means that speed boat turns evolve into cruise ship turns, making change slower and more laborious. I think that’s why it’s so incredibly important to ensure that you’ve designed scale-able products, priced them correctly, and packaged them smartly from the get-go, though some evolution is expected and a natural part of business life.

 

 

What methods do you use to collect wholesale orders?
What do you love or loathe about them?

THE LUCKY BREAK COMMUNITY SAID: 

soymuchbrighter@shopstockabl + my own standalone website 👍🏻

 

shopjanery: Since we’re a pet bed company, we use highly trained dogs to retrieve and deliver orders. Just kidding. 😁 I built a private portal within my Shopify site, using Locksmith to take online orders. However, I also accept orders by email, phone, order form, you name it. If they meet my minimums, I’ll take their order in whatever way is easiest for them!

 

saltwater_design: Order form, but most end up just emailing. I guess it’s one less step for them!

 

charliemadisonoriginals: I accept them by email. I’ve been struggling with figuring out a different option but haven’t found the perfect solution yet😉. I love @shopjanery’s Locksmith idea – I’ve been considering that too!

 

gavinluxe: Via email

 

sassypantsdesign: I’ve used order forms (various kinds, from simple to interactive) but most seem to prefer email, which is fine with me. My dream is to implement a separate wholesale ordering section on my website. It’s in the plans, after I get a mountain of other things done.

 

bougiequaintrelle: Website, email, or phone.

 

halfpintnaturals: I’m looking up Locksmith stat. I have a form that one shop uses out of the lot of them. Most email and call.

 

normalsoap: We currently get orders by email but would love a website as a part of Shopify for our customers to order directly from!

 

soapymomma: We take wholesale orders by phone, email, and through our website. After Etsy wholesale closed we added an app to the website that allows us to tag a customer as wholesale so that wholesale pricing is offered after our stockists have set up a wholesale account with us.

 

olivemyskin: Any way I can get them! What works best for all has been sending a blank order form with orders, then they fill it out for their next order, scan or take a phot and email to me. Working on a wholesale portal on the website. I don’t like phone orders though. Too much room for error.

 

MY THOUGHTS: I firmly believe that those brands that succeed in wholesale are the brands that make working with them painless and intuitive. That means understanding a buyer’s needs, establishing clear policies, supporting the stockist after the sale, and making the submission of those orders as easy as possible! Here’s a list of my preferred solutions (from most-desired to least)…

 

MOST PREFERABLE: A separate, wholesale-exclusive website with unique logins that you can assign and track. This allows you to tailor the entire experience to the wholesale buyer: displaying wholesale pricing, enabling ordering by the case, scaling shipping fees for larger orders, preventing checkout when cart totals fall below order minimums, previewing new collections before they hit the public eye, and providing a platform for the download of wholesale-specific marketing tools like shelf talkers.

 

An app that enables you to assign regular website users into a group of wholesale buyers. This enables online ordering, though it has its share of limitations. Essentially, you’re retro-fitting a retail site to work for wholesale buyers, as opposed to designing a wholesale experience from the ground up. Wholesale buyers log in to your website to see wholesale pricing.

 

Email. This is a convenient option for buyers that they can use 24 hours a day and it requires minimal investment on the front end from the brand owner. I appreciate that orders are written, which minimizes confusion.  Ideally, you offer a branded order form to buyers who can complete it and return it, further reducing the chance of errors.

 

LEAST PREFERABLE: Phone. Some buyers (especially those who are new to your line) just want to talk it out. If that’s the case, establishing regular office hours will help. If that’s not possible, aim to get back to buyers within 24 hours. In any scenario, it’s wise to summarily that order via email and receive confirmation that it’s correct before you begin production.

 

Each of these methods enables you to harvest orders from wholesale buyers who are already aware of your brand.  But what about those buyers who don’t yet know you exist? That’s where platforms like Faire (formerly Indigo Fair, Stockabl, and Wholesale Matchmaker come in! And I recommend that any brand that’s serious about wholesale invest significant energy into Instagram, as more and more buyers are using that platform to discover new brands.

 

 

Have you ever suffered through a wholesale nightmare?
What did you learn from the experience?

THE LUCKY BREAK COMMUNITY SAID: 

bainamourbath: Had a client that would not pay for weeks and weeks until she was ready to place another order. Would come into my brick and mortar and treat my managers rudely. Needless to say, I sent her a divorce letter that she was not happy about. Although she bought a decent amount of product, sometimes it’s not worth the headache to deal with certain clients. I had to focus on who I wanted representing my brand and she was not it.

 

MY THOUGHTS: Amen and amen! There are some customers who aren’t worth having, and recognizing that is a powerful evolution. But if fifteen years as a full-time business owner have taught me anything, it’s that. I’ve gently dismissed wholesale buyers from my product-based brand (and consulting clients too, for that matter). It’s always a last resort for me, but some opportunities aren’t worth the stress they generate and time they consume. It’s important to have an arsenal of good customer negotiation skills and strategies at the ready and equally important to know when cutting your losses is the best available option.

 

This also hearkens back to something we’ve already touched on in this post: effectively managing trade credit accounts. I’ve learned that customers will get away with exactly what you allow them to get away with, some communicating that you’re a serious professional, establishing expectations, and drawing healthy parameters is key. It’s infinitely more challenging to fix these issues after they arrive than it is to prevent them from happening in the first place! With that in mind, remember that we train people how to treat us. 

 

What strategies do you use to promote your wholesale stockists
+ make them feel like partners?

THE LUCKY BREAK COMMUNITY SAID: 

normalsoap: We try to show them new products when we have them. We try to treat them with free product they can use … and thus fall in love with. Just a few nice things we try to make them feel special. Don’t forget a holiday card thanking them and telling them you look forward to the new year!

 

MY THOUGHTS:Those are some stellar ideas, and there’s no shortage of things that we can do after the sale to help our buyers feel like partners, increasing the chance of reorders and long, fruitful relationships.  Some quick ideas…

 

  • Wholesale-exclusive newsletters delivered at least once per quarter

 

  • Hand-written “thank you” notes tucked into each order

 

  • If you create consumable products (body care, candles, soap, makeup, specialty foods, etc.): Including samples of other products in outbound orders

 

  • Offering marketing tools such a POP displays and shelf talkers to increase sell-through

 

  • Direct contact at least once every 8 weeks to check in on sales and see how you can help

 

  • Remembering your accounts at the holidays with a small gift

 

  • Promoting your wholesale partners via a store directory on your website and through social media “shout out’s”

 

JOIN THE CONVERSATION

Be sure to stop by the Lucky Break Instagram, where every month we chat about all things business. I’d love to hear your thoughts and hope you’ll lend your voice. Search the #LBCWantstToKnow hashtag to weigh in! In September, we’re chatting about all things website.

#LBCWantsToKnow >> July 2018: Pricing

LuckyBreak-LBCWantsToKnow-Pricing

LuckyBreak-LBCWantsToKnow-Pricing

 

Each month, I ask my Instagram community to join me in a focused, crowd-sourced discussion of a specific subject.  For the month of July, we dove head-first into pricing… one of my favorite topics. Often worried about, but seldom discussed, I welcomed an opportunity to roll up my sleeves and see how I could help.

 

When was the last time you implemented a price increase? How did you roll it out? How was it received?

 

THE LUCKY BREAK COMMUNITY SAID…

 

lillabarnclothing: Ah! I need to do this now. I’m going to up prices by 10%. Rolling it out next week after my summer sale.

 

stellachroma: At my rebrand a year ago. Just did it. No one batted an eyelash. Granted, it was at a rebrand. 🙂

 

yukonsoaps: A year and half ago. I just did it. No questions asked! And sales increased!

 

cocosabon: I increased on two products last year. I informed my customers prior to the increase and explained why it was necessary. No problems at all. 👍🏼

 

MY THOUGHTS: I recommended that my clients carefully monitor their costs and review them at least once per annum. If a nominal (3-7%) price increase is needed, it’s better to roll those out once a year as opposed to “saving them up” for years and then hitting your buyers with a large jump in pricing every few years. Anything less than 10% is typically received well by buyers, provided that the rollout is properly framed. Price adjustments on the order of 10%+ require more of a brand re-positioning (connecting with a new audience) and are decidedly more complicated, but totally possible.

 

I find that the very subject of price increases unnerves many makers + product designers, but this doesn’t have to be an anxiety-inducing affair. There’s definitely an art to framing the announcement, but we’re usually far more worked up about it than our wholesale partners and retail customers. Need some help in this arena? My instantly-downloaded price increase workshop can build confidence and guide you through the process of designing an elegant announcement. And Price-O-Matic, my product pricing software, can help you keep an sharp eye on costs and profitability, too.

 

Do you feel like you’re currently charging what your products are worth? If not, what’s holding you back?

 

THE LUCKY BREAK COMMUNITY SAID: 

 

westcoastleslie: I’m not mostly because I feel like it will hold me back from making sales. And I know you’ll say “those people aren’t your customers” which is true to an extent. But tell me who is going to buy a $200 scarf?🤷🏻 Honestly, point me in their direction!

 

idigyourhair: No, but I want to. I feel unknown and feel I need to grow my brand in order to do that. I have made them slightly higher online.

 

normalish_: Nope. I don’t feel like I am because I’m stuck in this crazy Facebook bubble of small businesses that all feel like we can only charge so much. Even the customers in this bubble complain/dictate if your prices are higher than the average. I’m desperately trying to work my way outta there.

 

focsimama: I wasn’t but I will be once this new brand launches.

 

scentshomebodybaby: Agree with all these comments!! Just trying to charge enough for people to purchase to make my brand known. It’s so hard.

 

sasaloo.living: There is the never ending question!…. among others, lol.🤦🏻

 

MY THOUGHTS: Pricing is decidedly complex. It brings together many elements (brand presentation, audience awareness, consumer psychology, distribution strategy, tricky math… blech!) and we must take all of those elements together to create a narrative and a presentation that both taps our people and keeps food on our tables. That’s no simple task!

 

Finding the right people, crafting a capable narrative, and increasing your company’s ability to communicate value are all pillars of strong brand development. If you haven’t laid the critical foundation for your brand, then it’s virtually impossible to command the prices you want or need. I echo the sentiments above: we must break out of our bubbles by becoming aware of the larger competitive landscape and staying tethered to the players in that market. As to the $200 scarf question, I ask: Are there $200 scarves on the market? If so, there are $200 scarf people out there!

 

Not everyone can afford a $200 scarf, and not everyone who can afford it wants to spend that sum, but pricing runs along a spectrum. You could buy a new car for $12,000 (Smart cars) or a new car for $260,000 (hello, Ferrari!), and virtually every price point in between. The Ferrari peeps know their audience and they aren’t worried about the Smart car audience. It’s up to each of us to decide where on the pricing spectrum we want to play, and the key is to build value that’s commensurate with the price tag we attach to our work. You can’t sell a Smart car at Ferrari prices, but you can sell a Ferrari at Ferrari prices. And you’ll need to create a Ferrari-worthy experience for buyers at a premium price point.  Think: flashy showroom, attractive salespeople in elegant suits, champagne as you shop, etc.

 

We can all take the reigns on our pricing by doubling-down on our attempts to control costs and create efficiencies. In this case, every penny saved really is a penny earned. I’m often tasked with helping my clients develop more efficient production strategies, seek new suppliers, and offer a “bird’s eye” review of expenses to help trim things down. Once we’ve become as efficient as possible, then the work pivots to cultivating the customers we want, becoming more aware of the market, and sending the right signals to show that we’re creating premium products for a specialty audience.  It’s possible, I promise!

 

If you want to work on becoming more intimately aware of your audience, broadening your view of the marketplace, and upp’ing your brand presentation, then I invite you to explore Brick House Branding, my 9-week brand mentorship. Enrollment for the first live semester of 2019 opens on October 2, and the program is now available in an instantly-available “On Demand” version, too.

 

JOIN THE CONVERSATION

Be sure to stop by the Lucky Break Instagram, where every month we chat about all things business. I’d love to hear your thoughts and hope you’ll lend your voice. Search the #LBCWantstToKnow hashtag to weigh in! In August, we’re chatting all things website.

#LBCWantsToKnow >> June 2018: Holiday Wholesale Outreach

LuckyBreak-LBCWantsToKnow-Holiday

LuckyBreak-LBCWantsToKnow-Holiday

 

Every month, I ask my Instagram community to lend their voices to a focused business conversation so we can crowd-source meaningful discussions. I call it #LBCWantsToKnow and it’s one of my very favorite things of 2018! Though the mercury is peaking and all the wee ones are out of school at the moment, I’ve got the holidays on my mind… because the wholesale march generally begins in mid-summer.

 

When do you start planning for holiday wholesale outreach?

 

THE LUCKY BREAK COMMUNITY SAID: 

  • canardlabs: July 1st. Our Holiday Catalog Insert is launched and sent along to our reps and rep groups! We order the Fall/Winter ingredients in May. Make the products and photograph them in early June, then release them to our peeps by July 1.

 

  • olivemyskin: August is when I start. Keeping records from prior years helps tremendously. It make order placing easier.

 

 

MY THOUGHTS: The holidays often catch makers and product designers off guard and our holiday game plan needs to kick off much earlier than many new business owners realize. Buyers for most categories start scouting for new merchandise in late July and August.  If you’re ever perplexed by when they’re on the prowl, look towards the trade shows for your product category.  Those always occur in at the start of prime buying seasons, so it’s an way way to remember when you need to turn up the heat.

Many of us experience an annual retail slump in the summer months- retail consumers (both those that shop online and those who flock to brick + mortar stores), are otherwise distracted with summer plans. They’re out of rhythm, focusing on other endeavors, and we don’t have the benefit of any major gift-giving holidays in June, July, or August.  Though it’s painful to see revenues wither in these months, that also makes this period “prime time” for holiday prep. Finish up any new product development, tee up your fall releases, polish marketing materials, and line up a concerted push for wholesale attention. Then launch those efforts in August and keep the heat on for new buyers straight through late October.

 

In my experience, December is pretty much a ghost town in wholesale, but that’s generally a blessing as most of us are swamped with retail orders. November typically sees a steady stream of orders, but they’re generally reorders from stockists who are selling out inventory or existing accounts who are a tad late to the game on holiday ordering. But August? September, and October? Prime time to get on the radar of new shops you’re itching to get into.

 

 

Will you be releasing new products for the holiday season?

 

THE LUCKY BREAK COMMUNITY SAID: 

 

  • olivemyskin: Holiday scented candles and warm, spicy soap

 

  • woodenheartdesigns: Adding new products now based on my best selling items and revamping some things so I don’t feel so overwhelmed right before the shopping season starts. My biggest challenge is always finding work/life balance during the peak season.

 

MY THOUGHTS: “New” is the lifeblood of wholesale, and seasonal launches are essential to this market segment. But that doesn’t necessitate that you launch 87 new products or jump into an entirely new product category! Seasonal fragrances for those in the apothecary or candle space, fresh colorways or prints for textiles, a thoughtful jewelry collection of several capsule pieces…. that’s really all you need. And for those in the gift space, bundling existing products into gift sets in ready-to-go packaging is always a smart idea.

 

Ideally, those products are ready to launch in July. I recommend using that month as your benchmark, then doing some quick reverse math to map out deadlines for each step of the development process.  Whether your product development takes 3 months or 6 months, the process usually starts months ahead of when we imagine it would!

 

 

Black Friday + Cyber Monday promotions: Are they a blessing or curse to your business?

 

THE LUCKY BREAK COMMUNITY SAID: 

 

  • lillabarnclothing: We do a small biz Saturday online event with one of a kind pieces and other unique items that aren’t usually available. Trying not to do too many discounts, but this seems to be a fun event especially for our insider group.

 

  • stellachroma: Thanks to you, we don’t do percent discounts often at all and I think business is better because of it. We may do a free shipping and gift with purchase deal this year rather than a price discount.

 

  • horsefeathersgifts: We use Black Friday to clear out any inventory we no longer want on our site. It’s always been a big hit with our customers.

 

  • lotionbarcafe: I am closed on both those days. I am an ambassador for small biz Saturday and that has been the best!

 

  • zhibathandbody: Bundles and free gift wrap is what I do most; occasionally free shipping. Deep discounts were never effective. I set up automation for Black Friday & Cyber Monday, then work up a nerve to do a live event on Small Business Saturday.

 

MY THOUGHTS: It’s terribly easy to let discounts be the death of small business.  A steady stream of percentage-or-dollars-off promotions or occasional deeeeeep discounts serve to hamstring creative brands. They move the needle away from value and center the discussion on price (which really isn’t what you want to focus on, unless you’re a discount brand). They train you customers to only shop when your products are on sale.  They undercut your wholesale partners, which jeopardizes those relationships. All the way around, they get a hard “no” from me.

 

With that said, I’m keenly aware that these are the biggest shopping days of the year and consumers are accustomed to a buffet of offers during Thanksgiving week. I recommend a few things…

 

  • Starve your customers a bit. Not literally, but figuratively. Pull back on your sales throughout the year to make your holiday promos more special.

 

  • Consider adding value rather than deducting dollars. There are are many creative ways to structure offers and incentivize ordering. Consider offering free shipping (or a lower free-shipping threshold than your usual), adding complementary gift wrap, increasing loyalty points on purchases made during a promo period if you offer a loyalty program, etc. Bonus product (buy this, get that) or deluxe samples are always welcome offers, too.  Essentially, do anything other than give people what they often get for less dollars than they usually pay for product. Ideally, you collect the same number of dollars, but those dollars stretch further.

 

  • Transition to a 2.2x wholesale pricing structure. If you create a $22 candle, then offer it for wholesale at $10, rather than the typical keystone of $11. That means that your recommended retail price (and the price your charge on your own website) is 2.2x wholesale, rather than 2x. If you pivot to this type of pricing structure, then you’ll attract wholesale partner like bees to honey and you give yourself a 10% off cushion when you run sales. So your $22 candle can sell for $20 during a sale, and you’ve still protected your stockists by not charging your own customers less than 2x your wholesale. Everyone wins! An occasional 10% off, especially when coupled with a value-added promotion is far better for a brand than a temporary 20, 30, or 40% slash in price.

 

Want to chat more about the power of smart promotions and how you can structure them? I’m offering a free business workshop via FB Live in September to chat about this very thing! Join me on Lucky Break Consulting’s Facebook page on Thursday, September 27 at 2pm Eastern/ 11am Pacific for a live conversation and some rich Q+A.

 

Also, I invite you to join me on Instagram in July I’ll be hosting a conversation about pricing and I’d love to hear your thoughts. Search the #LBCWantstToKnow hashtag to weigh in!