Welcome to Curious Business
Every Friday, I post a small insight into running Curio City and/or Blue Hills Editorial Services. My most recent posts are directly below. You can also start with the first post, or use the subject labels to the right to home in on particular topics. Feel free to comment on anything that interests you.
Friday, February 27, 2009
This week was a little weaker, but not weak enough to sink the month. Here are the year-to-year numbers:
Total income: +29.9%
Total COGS: +5.3%
Payroll: +31% (yay me!)
Net Income (Profit): -29.9%
This year’s bigger loss is merely a bookkeeping artifact caused by taxes and fees. Taxes always push February into the red. My YTD loss is only $70 higher than LY, and that’s entirely attributable to higher payroll – meaning money in my pocket, which is not entirely a bad thing.
Even though February is meaningless, being up 30% in this disastrous economy is heartening – virtually every economic indicator is at historic lows and still free-falling. I choose to believe that changing my tagline from “Curious Gifts for Curious People” to “Unusual Gifts of Good Value” made all the difference. :)
Early this month I had $2,200 open to buy. As of today, I have (-$763). Half of the $3,900 that I spent this month replenished sold items; the other half is buying new merchandise. Since a lot of that won’t ship (and bill) until April, the red ink doesn't worry me. But my cash on hand + accounts receivable is technically below my accounts payable, maybe for the first time ever. I need to be very tight with a buck if I’m going to have anything to spend at next month’s Boston Gift Show.
Speaking of next month…March’s targets are much more challenging than February’s were.
Most of my smaller vendors are filling orders at warp speed. They must be sitting around with nothing to do. One of my newer large suppliers, however, froze me out of their initial spring product shipments. Maybe I ordered too late, or maybe they serviced their bigger accounts first. A lot of stuff that I thought would be arriving over the next few weeks is delayed until late April. That’s going to make March even more difficult.
Turnkey’s investigation into my site’s broken Wishlist feature came up blank. The bug was undoubtedly caused by some modification that Eric or I made in the indeterminate past. Removing one obsolete modification enabled me to toggle the feature off; previously, doing so screwed up my menu bar layout. And so I fall back upon a lesson that I learned in my software development career: If you can’t fix the bug, remove the feature. Fixing the Wishlist is now officially wishlisted.
Friday, February 20, 2009
The telephone calls did pick up, and I got a few more junk calls. But the volume isn’t overwhelming, and it's led to one or two sales. A good-sized minority of shoppers out there still don’t understand that encryption makes ordering online more secure than phoning in their credit card number. Instead of removing the number, I made the language less hostile. The page now says “You can call 555-555-5555 Monday through Friday from 10 AM to 4 PM Eastern time...but as we are a small company, our phone is not always staffed. Feel free to leave voice mail.” I’m trying to take a neutral position, neither encouraging nor discouraging phone calls.
Next, I’m going to study third-party Sunshop mods for ways to improve my site. Even though these mods are free, I need to be very careful. They are file modifications, not drop-in modules. They challenge my technical skills and complicate future upgrades by increasing the customization that needs to be carried forward manually. There is also a risk of unintended consequences. For example, one mod implements subcategory menu flyouts – a feature that I’ve wanted literally for years. But some users warn that the code (Flash?) makes the category list invisible to search engines. Improving navigation won’t help anything if I simultaneously harm my search engine rankings. And of course there is always a chance that the modified code will conflict with some other customization or become incompatible with a future upgrade.
I do have a couple of ideas for boosting sales with improvements that should cost little or nothing. Investing in the business is not an option until my wife is secure in a new job. Financially, Kraken Enterprises must carry its own weight until then.
The good news: It’s doing so. Business was good again last week. If next week didn’t contain one $600 sale from LY, I’d be anticipating very good February numbers. Given that the recession was not even recognized yet at this time last year, and that the economy’s in free fall right now, beating LY is impressive enough.
Friday, February 13, 2009
I spent the early part of the week spending the $1,200 that DCI refunded; $1,000 of it is going back to DCI. Most of my two-dozen new products won’t arrive until April or May. None have obvious bestseller potential, but a few might become standbys, and a good stable of those is better than relying on one star item.
I got my corporate tax returns back and paid the CPA. I canceled Merchant Express. I worked on my next newsletter. I’m changing over my seasonal display. (Yawn)
I spent the end of the week working on our household budget, starting our taxes, and scowling at Anne’s layoff paperwork (COBRA and some state assistance plans). It looks like Obama’s going to reimburse 65% of our COBRA payments for nine months. That would be a huge break, since we’re not quite poor enough to qualify for Massachusetts’ equivalent program...yet Mass. requires us to have health insurance, and letting it lapse can prevent one from getting future coverage. None of the COBRA alternatives that I explored panned out.
Sales are tracking my reduced plan nicely. I got a tiny Valentines Day bump – later than expected, but VD has never been a serious holiday for Curio City. Accounting and tax bills make February a losing month anyway. As of today I have paid the CPA and the government $659, and the month’s bottom line is (-$635)…with another $465 tax payment due. The bottom line won’t turn black again until Halloween.
Friday, February 06, 2009
I used to say that whenever traffic chronically choked the roads, stores and restaurants grew overcrowded, prices rose, and service and civility fell below minimal standards – the byproducts of an overheating economy. Recessions are capitalism’s way of weeding out the weak and the marginal. “Last hired, first fired”.
This recession is not like all the others I’ve known. Instead of firing their worst employees first, companies are cutting their most expensive and losing their experience, competence, professionalism, and work ethic. Instead of improving as the economy wrings out excess, service is eroding as responsibility devolves to cheap young slackers. Instead of the best companies prevailing, we are seeing survival of the cheapest.
Well, at least traffic doesn’t seem as bad lately.
The new credit card processor is finally integrated after Turnkey fixed their payment module. I don’t know if CDG Commerce will ultimately be a good move, but it should at least save me a little money (survival of the cheapest, remember?). I sure won’t miss Merchant Express. I will fire them next week, when I'm positive that CDG is working out.
The big DCI return credit finally came through, seven weeks after their initial error. I can start buying merchandise again. Their missing backorder appeared on the wrong credit card – I gave them my Amex number when my old MC was hacked. They charged me on 1/20, and I haven’t actually received the shipment yet, but at least there’s some indication that it might have gone out.
DCI’s commissioned sales rep has failed to answer three emails this week, so I’ll need to deal with them directly. I’m going to have to watch this company closely, and expect long delays in order fulfillment and problem resolution. It must be run by cheap young slackers.
Another weak week inspired me to reduce my 2009 sales plan again, from a 50% increase over 2008 to 25%. Any increase at all is optimistic, obviously, but Curio City started at such a low level that it needs to sustain double-digit growth if it’s ever going to support me.