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.
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Friday, November 27, 2009

Red Ink on Black Friday

Week 3 of Christmas will follow the first two weeks into the crapper unless an unexpected rush pulls it out in the next day and a half. “Black Friday” is typically quiet while the Normals are out looking for deep discounts in stores. “Cyber Monday,” which finds the office workers back at their desks, is better, but accounting-wise that’s in December.

If November does come in behind LY, it will be my first losing month since June. After pulling all the stops out of advertising I'm now paying a frightful sum to buy 250-300 visits a day, but my conversion rate has fallen. Many transactions are in the $10-20 range when they should be averaging $50-100. Wednesday brought a respectable 10 sales. It would have been a good day if my historic average of $40 each held up, but instead the day finished at $185. Bleah. People are shopping, but few are buying. Those who are buying are spending less, and they’re buying the wrong stuff. Well, at least I’m liberating a few dollars that have been locked up for years in old, dead merchandise.

How to explain this? I lost half a day’s business to a technical problem late last week before I found and fixed it (thanks to my developer’s rapid response to the Brad Signal). I lost 32 newsletter subscribers when Comcast decided to block all email from Constant Contact. I emailed all of those customers individually and asked them to re-enroll with a different email address, but I don't expect to get any of them back. Setbacks like this crop up routinely, though.

I think macroeconomics are to blame. Last October’s financial crash only hammered people with stocks and big retirement portfolios. Housing values had only begun to plummet and employers had just started destroying jobs, so ordinary people were not yet impoverished. A year ago the rich were hurting, but the middle class could still shrug it off. This year, bailouts have restored prosperity to the rich, but average people are desperate. And my customers are average people.

What can I do? Yesterday I used a newsletter and Facetweet to put out a discount code good for free shipping (actually 60-cent shipping because Sunshop is too stupid to waive the handling fee). That code is BIGBIRD – use it! It’s good on a minimum $25 purchase to any US address, and it expires Monday. I should probably facetweet a reminder on Sunday. It was a particularly entertaining newsletter, if I say so myself. Sadly, only 44 out of 278 recipients have opened it, thanks to yesterday’s accursed holiday. If it were up to me the Normals would be chained to their desks 365 days a year. :)

Both the new Power Caps and the old 2-LED caps have stopped selling almost entirely. I’m buying 50 clicks a day, but only bottom feeders looking for outrageous discounts are responding. I don’t think anyone’s undercutting my retail price online…they just plain aren’t selling.

With my core products dead in the water (even Whisky Stones have fallen to nearly nothing) this week is running about 25% behind LY, which was in turn down from 2007. So with only three more weeks to go I’m up against LY’s free mention in the NY Times gift guide. December is not going to be pretty.

Here are November’s numbers:

Total income: -2.9%
Total COGS: -16.5%
Payroll: +371.5%
Net Income (Profit): -39.7%

The YTD numbers:

Total income: +20.6%
Total COGS: +15.8%
Payroll: +50.3%
Net Income (Profit): -21.4%

What is there to be thankful for? Well, November didn’t drag the YTD numbers down too badly. The bar is set low for next year. Costs fell farther than income, and more money went into my pocket. The year should still end with a small profit, and if it's smaller than LY’s, then I'll owe less tax on my K-1 income.

Friday, November 20, 2009

Measuring the Days

A late surge saved last week from the disaster that I prematurely reported in my last post. It was still behind LY, but not dramatically so. Thank you, customers, for playing the cavalry. Don’t scare me like that again.

Last week I reluctantly stopped advertising DayClocks because bottom-feeders have driven the price into the ground. The very next day, DayClocks announced their first new model in years – a smaller version of the Oak Contemporary. The day after that, I actually sold my first DayClock in over a month, followed by another one the very next day. I’d like to wait 10 days to see if the discounters will ruin the new clock, too, but I can’t waste valuable Christmas days on indecision. So I spent the $200 price of admission, even though my open to buy is $2,600 in the red and the old Contemporary DayClock never sold well.

But last week is ancient history. This week began with an uphill slog when one of last week’s customers canceled a $116 order that she had placed in error. Watching a day struggle to reach zero is depressing, but these things happen. Right now it’s a nail-biter whether the week will achieve LY or not. Forget about plan. Merchandise shortages are appearing. Manufacturers were conservative this year, so supplies of the most popular stuff are spotty. Retailers would rather miss incremental sales than mark down leftover inventory, so stock levels are light. Virtually everybody is understaffed from job-cutting – yesterday I gave up trying to reorder Temperature Controlled Faucet Lights when the manufacturer’s phone went unanswered. And because companies fired their oldest, most experienced workers, the overworked cheap youngsters who are left can't meet the pace. If you're one of those shoppers who waits for last-minute markdowns, you’re only going to find crap this year.


Several months ago I read a news report about the Mass. Medical Security Program running out of money. Enrollment had spiked from 3,800 to 27,000 people as of August. The state had sent us information about this program when Anne was first laid off, but there was no way we could qualify at the time. I trashed the paperwork and forgot about it. Six months later, with her salary a distant memory, our circumstances were sufficiently reduced to give it another try.

Yesterday we were accepted! The state’s 80% reimbursement will reduce our stifling $770 monthly health insurance premium to a manageable $154 for as long as Anne’s unemployment checks hold out, surpassing the expired federal COBRA subsidy. This is not the first time I’ve thanked the gods that we live in the most liberal state in the US. Saved by socialism! I don't know how people in miserly red states survive without lifelines like this. They just suffer, I guess.

Now I can cheerfully mothball the health insurance topic until the next threat comes along. It looks like we’ll be OK until COBRA expires next August. I think Anne’s unemployment checks will continue into Fall 2010, although the DUA seems to be unable to tell her when her claim extensions will all be exhausted. Maybe the national economy will take another plunge and Congress will keep extending benefits forever.

Friday, November 13, 2009

Taking Leave

I seized a couple of beautiful days this week to rake my accursed lawn. I’ve got nothing personal against leaves, but one must meet minimum expectations. Sales stumbled badly while Curio City took a back seat. This was the first week since early July that I didn’t beat last year…and I missed it by well over 50%. Maybe it had something to do with Veterans Day – observed on Monday by many companies and on Wednesday by the government. Maybe it’s a school vacation week. Sales are always poor when the office workers aren’t shopping at their desks, and when their kids are underfoot. I hope it’s just a blip and not a harbinger. I don’t think there’s anything I can do about it, anyway.

At least I got the stupid leaves cleaned up. I hate that chore almost as much as I hate shoveling snow.

To counter the sales stumble I reined in some of my worst advertising excesses. I killed the most expensive words in a couple of popular products – the ones that get 4 or 5 clicks a day but never convert to sales. After years of reliable sales, I reluctantly suspended my DayClocks ads because I can’t compete with discounters ($30 plus free shipping for an item that costs $20? How do they live on a $5 markup and still outbid me in advertising?). I pulled the plug on Pirate category ads. Based on the click prices Jolly Roger stuff must be ubiquitous, and that always means that bottom feeders own the market. Not being a consumer myself often blinds me to things that are obvious to normal people.

I drove my open-to-buy deeper into the red than it’s ever been before (mainly to get the next round of new Power Caps due out in early December). Relying on tomorrow’s sales to pay today’s bills is not ordinarily my kind of gamble…but that’s how capitalism works, right? Combining deep deficit spending with a drastic drop in expected sales has me very, very worried right now.

Apparently American Express is worried, too. They noticed that I never use my whole line of credit and cut my ceiling by 50%. That’s OK; my Citizens Bank Mastercard does the heavy lifting now. The lower LOC on my Amex card will probably improve my credit rating. It's just another sign of hard times.

Well. I’m out of money and running out of time, so Christmas is locked in. Six weeks out of the year really matter. The first one just ended in unambiguous failure.

Friday, November 06, 2009

Shop Your Way to a Greener World

Environmentally-friendly practices usually coincide with sensible economics. Curio City reuses every possible shipping carton primarily because a virgin box costs $0.50 or more. I reuse 90% of the packing material that comes my way, and I wad up the Braintree Forum when I need more. Most of the little trash that I do generate goes to curbside recycling, so virtually nothing ever reaches the SEMASS trash-to-energy plant. I use USPS carrier pickup not just to save me a trip, but also to avoid standing in line with international shipments. Two of the three light bulbs in my “warehouse” are CFLs. (I keep whacking my head and breaking the third one, so I went back to a cheaper incandescent there.) I turn off the lights and my computer at night not out of altruism, but to cut the electric bill. It’s sensible and easy for a tiny home business to be “green”.

Mega-conglomerates have a tougher row to hoe in their quest to appear green.

My bank, RBS Citizens, has the Greensense program. In exchange for accepting electronic statements instead of paper, I get a debit card with a picture of a tree on it. The core of the card is made from cornstarch instead of plastic (the skin is obviously still plastic, and corn is an environmentally destructive crop, but let’s not dig too far beneath that nice tree). They pay me 10 cents every time I use my debit card if I make the minimum 10 monthly transactions (I usually don’t). I don’t understand how swiping my debit card is “greener” than using cash money or my credit card, but I suppose I must be spending my way to a better world. Otherwise there wouldn’t be a tree on my card, would there?

Now UPS is “Introducing a greener way to ship!”. Well, that’s nice. UPS's enormous fleet of trucks and airplanes is probably among the biggest carbon emitters on the planet. They must be using alternative fuels or electric vehicles, right?

Uh, no. They are voluntarily buying carbon offsets before cap-and-trade legislation compels them do to so, because “shipping your packages produces emissions that many believe contribute to global climate change.” (Notice the care not to offend global warming deniers). Cap’n Trade is the dubious practice of paying companies that don’t pollute for the right to do so yourself, on the theory that the overall cap will reduce aggregate emissions. To be fair, UPS didn’t invent that questionable scheme. Arguably, they deserve congratulations for doing it before they’re legally compelled.

Here’s the fun part: For “as little as” 5 cents per package, anyone can “ship carbon-neutral”. That’s right: They’re asking their customers to pick up the cost of the carbon offsets. If I tick a box to pay their premium, UPS will add a logo to my customers’ tracking emails showing them what swell companies we are. And, for a limited time only, UPS will match the first $1 million in contributions that their shippers make. That’s right: They will graciously chip in toward their own offsets. Gosh, what a great company!

What’s really sad is that I’m actually tempted to pay for their emblem. Consumers are easily hoodwinked into thinking that they can shop their way to a brighter future. And so we have this week’s new reason to hate UPS. Here’s their page if you want to see their side of the story, complete with hummingbirds and rainbows.


Remember a few weeks ago I said that all of my medical bills are paid in full and the bill collectors have all been caged? It started with a colonoscopy in November 2008. Before I scheduled the procedure Blue Cross assured us that as long as I’m over 50 and my doc recommended it, it’s 100% covered. Unfortunately, the clinic entered my insurance number wrong. Just as a paperwork mishap in Terry Gilliam’s Brazil led Mr Archibald Buttle to suffer for the sins of arch-terrorist Archibald Tuttle, we’ve been fighting the system ever since.

To date, I’ve paid $489.36 to four separate companies for assorted deductibles and copays. Today I got a new bill for $105 for “unpaid copays”. None of these bills ever come with itemized explanations, of course, so each new bill requires another call to Blue Cross – an ordeal in itself. I wonder if they can explain how our supposed $20 copay got to $105.

So the insurance struggle resumes. I swear two things: First, I will die before I ever consent to another diagnostic procedure of any kind. And second, the conservatives who oppose health care reform are gibbering idiots. I want to see the insurance companies dissolved and all their executives hanged.

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