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, December 25, 2009

Look Forward to Looking Back

At last, Christmas is over! Traffic has drifted back below 200 daily visitors and just a few sales. I’m still shell-shocked from the workload. Where are all the emergencies? Lost and mis-shipped packages! Damaged and defective items! Fraudulent claims! Irate customers! It’s too quiet. Well, I guess people are probably going through the formality of presenting gifts right now. AFAIK I did not screw up any of my 600+ Christmas shipments this year.

I should probably try to find my telephone. I’ll bet there are voicemails.

I'm resisting the temptation to spew forth my 2009 statistics until the year actually ends, even though the remaining week isn't going to change much.

Things I’m pondering for 2010:

Exploiting Facebook. I’ve figured out the basics. I’ve got 50 fans (halfway to my goal of 100 by the end of 2010). I’ve got fan boxes on my blog and on the News page of my store, with a link in every newsletter. Short enough posts automatically go out over Twitter. Now I need to figure out what to use it for. Using “wall” posts for short news announcements and impromptu discount codes is obvious. But does the site itself have a role? How does it fit in with my store, my blog, and my email newsletters? How can I encourage participation? What kind of content do I need, and how much effort should I put into it? Most of all, how do I make it attract more fans? I think this has meaningful potential for marketing next year.

(Tentative answer: Use it to show the personal side of the business – pictures of me, my house, my car, etc – sort of like I tried to do years ago with the Kraken Enterprises website. Perhaps I could use it for personal/political subjects like my health insurance struggle. I need to explore some other business pages for ideas. The next version of Sunshop will reportedly include a Facebook product feed, so that could become a reason to advertise my page.)

Drop international shipping. I figure roughly 1-2% of my sales go to foreigners. Processing those is extra work and currency conversion fees make them less profitable. The requirement that I hand them to a postal employee, rather than drop them in a box, forces me to schedule a carrier pickup or wait in line at the post office. The rate of customer dissatisfaction is high, especially among Canadians thanks to their government’s vigilance about collecting stiff duties. The so-called global economy is a myth from a business-to-consumer viewpoint. Still, can I really afford to turn my back on up to 2% of my existing business if I want to reach 15% growth next year? Maybe I’ll just eliminate UPS Standard to Canada, which seems to generate most of my complaints.

Drop Google Checkout: Again, it’s a small percentage of my business, and I’m sure that those customers could find another way to pay. Exorbitant shipping rates probably repel as many sales as the GC badge attracts. Google is apparently never going to address the shipping bugs that I reported to them a couple of years ago. I cringe every time a GC customer pays $8 to UPS something that I could mail for $3, and I resent having to drive to the UPS store to drop it off. But I suppose that as long as some customers are willing to overpay, I should be happy to have their orders.

Discontinue Cards: Write all of those suckers off and close the department. I very rarely sell any, even at cost. This one’s a no-brainer. I’m just waiting for the calendar to flip so that I don’t ding this year’s profit.

Drop Giftwrapping: In all of 2009 I made only $118 selling giftwrapping service -- most of it in December, when my time is most precious. Now, I don’t mean to scoff at $118. But a product’s giftwrap option dialog prevents you from adding it to your cart directly from the category page; you have to go to the product page to choose “No giftwrapping”. That adds an extra click to most of my products. And last year I spent $149 on wrapping paper, so I didn’t even pay back my cost (admittedly, I bought a huge supply of my two most popular papers, and my wife appreciates the “free” wrapping paper at Christmastime). Giftwrapping doesn’t make financial sense and it makes shopping a little less convenient.

Rather than kill it, I revised my spreadsheet to take giftwrapping revenue out of sales and add it to payroll. I’ll be more kindly disposed to wrapping when the money goes directly into my pocket, and it’s mainly a labor expense anyway. Of course, this is just an Excel fiction; to QuickBooks, it’s just “Other” income. I would need to change that if I ever used QB to calculate my payroll, rather than just plugging in the number that Excel kicks out.

Another Raise: I’m going to raise payroll from 19% to 19.5% of net sales, effective with my next paycheck. If sales are on plan, I’ll achieve my 20% target in the fall.

Cosmetic Facelift: The latest Sunshop release added two new templates. You can see them at the demo store here. In the “Choose Your Theme” dialog at the top of the page, choose “Modern Black” to see the template that I use now. It’s functional, but tired. “Custom One” and “Custom Two” are new. The first one is an up-to-date commercial look. The second one’s more interesting, but I think it would wear out its welcome pretty quickly. I’d want to customize Custom One, rearranging some page elements and changing some colors. I’d also want to add some “Web 2.0” features (very simple animations, color changes, etc.). I need to find some examples that I like and ask Brad if he can implement it. What do you think? Is it enough of an improvement to justify spending hundreds of dollars?

Friday, December 18, 2009

Achieving the Minimum

In December 2008 I set a record of 49 sales in one day. Last Friday that record fell when those precious Whisky Stones pushed me to 51 sales. I sold all 60 pieces in 18 hours…without advertising! The local store featured in the Boston Globe gift guide must have run out within hours, and then all the frustrated people went online and found me via natural search, which is really heartening. I could have sold hundreds more if I'd had the stock. Ordinarily the sales tax drives Massholes away from my site, but last weekend brought numerous in-state sales. The big day had 461 visitors and a phenomenal 10% conversion rate. 47 people came directly to my URL without any referral.

Week 6 of the Six Weeks of Christmas is within striking distance of LY’s sales. At the moment, the Six Weeks together are exactly $17.86 behind LY. There are still two weeks to go in December, and some pent-up demand for Power Caps, so there’s a chance I’ll still pull the month out of the fire. For some odd reason traffic peaked at 581 visitors on Tuesday, when I had only 14 sales.

My optimism about a general economic recovery has soured as our household finances continue their slow slide from dire to desperate. I reduced my 2010 growth plan from 30% to 15%...and that still feels over-optimistic, at least for the first half of the year.

I earned about $10,800 in salary this year. Hitting five figures is a big psychological milestone. Kraken Enterprises should finish with a profit of roughly $6,200 (down from $7,400 LY), which is distributed to me and taxed on our personal return. (I’ll actually withdraw about $4,500, cashflow permitting, and reinvest the rest in the company). My total compensation this year will be around $17,000, vs. $16,400 in 2008. A fulltime worker earning the $8 Massachusetts minimum wage grosses $16,640. So I have finally achieved my longstanding goal of earning minimum wage – I actually earn more working for myself than I could earn working for somebody else. Wow.

We fell into the 15% federal tax bracket this year and Massachusetts takes 5% more, so taxes will take $1,200 of my $4,500 payout. If I really make my planned 15% sales increase in 2010, I could hit $20,000 in salary plus bonus next year. Since my salary and the company’s profit are almost the same thing, I’m raising payroll from 19% to 19.5% of gross effective in January. (The money paid from profits isn’t subject to Social Security or Medicare taxes, but I need more cash up front).

Just for perspective…I made $70,000 in the software industry one year during the Clinton boom, before George Bush and 9/11. Anne earned even more. It’s hard to remember that we were rich as recently as eight years ago. That was a completely different world.

Something new to hate: Facebook! The Facebook widget to your right pissed me off. While I was fixing the broken Tweeter widget directly below it I noticed that my FB feed had stopped updating. I figured out that they had changed the URL. I fixed that and the widget worked again…until Dec. 8. Grrrr. I need followers, and that’s my best way of getting some. They finally fixed it on Dec. 16.

Hey, here’s a new reason to hate QuickBooks!

We are writing to let you know about a Sales Tax Report issue related to the December 1, 2009 Release 9 (R9) of QuickBooks 2009. If you downloaded R9 earlier this month, the Sales Tax Liability and Sales Tax Revenue reports are not displaying the correct data in some cases. Specifically, this issue applies to you only if you meet the following conditions: within QuickBooks the sum total of items in your Items List multiplied by the nubmer of vendors in your Vendor List equals more than 10,000.

Naturally, the Item List doesn’t tell you how many entries it contains or explain what a "nubmer" is. If it includes inactive items, mine must be in the vicinity of 1,000...and I certainly have more than 10 vendors. I reckon I should be glad they found and patched it before I filed my tax return. But...there's a bug in the patch, too, and now they're scrambling to produce R11 before the end of the year.

Friday, December 11, 2009

Saved By the Stones

Remember how I expected Week 4 to finish thousands of dollars behind LY’s corresponding week (which benefited from a free mention in the NY Times gift guide)? Instead, I finished less than $100 down. 2008’s stroke of marketing luck moved about 300 Recycled Motherboard Christmas Trees at $10 a pop. (I just sold out of those this morning, btw). This year I moved 150 of the surprise bestseller Whisky Stones at $20. I made the same amount of money on half the work. Sweet! Maybe next year I’ll find a $40 product that’s good for 75 units.

Week 4’s unexpected success crippled Week 5. First Panther Vision tied one hand behind my back by selling completely out of Power Caps. I effectively ran out on Wednesday and can’t get more until next Friday, Dec. 18…optimistically. Then I tied my other hand by underestimating the run on Whisky Stones; I ran out on Monday. Sales fell when I stopped advertising my nonexistent products and continued to slide all week. Week 5, which should have been the single biggest week of the year, threatened to deliver the huge setback that I had expected in Week 4 – it was struggling to reach 50% of LY. And then, another last-minute miracle saved my bacon again. My last 60 packages of Whisky Stones came in. I sold 18 sets within two hours -- without advertising. While this week will still be down, it won’t be as bad as it looked this morning.

What’s bizarre is that my workload remains heavy, with 15-20 sales per day. They’re all small orders. I’m getting almost none of the grab-bag orders that I’ve seen in years past. People aren’t impulsively putting a dozen items in their cart this year. Because the process of putting things in boxes is only a small part of the labor in filling an order, one $10 item is nearly as much work as a $200 order with a dozen products. I know I ought to be grateful for all these little sales, but I’ll admit that I cringe every time one comes in.

Well, at least my on-hand inventory is shrinking. I’ll be effectively out of old 2-LED caps by the time my Power Caps finally show up. I have less than $18,000 worth of stuff in the cellar. If only it weren’t the most desirable stuff that’s gone!

With only one week left, nothing that I do now can affect the outcome. The caps either will arrive in time to make a difference, or they won’t. Whisky Stones are out of the picture. Customers either will flock to something else (save me, Switchables!), or they won’t. Week 6 either will reverse some of Week 5’s slide, or it won’t. December either will completely cancel out the previous 11 months’ sales increases, or it won’t.

The Boston Globe’s holiday gift guide mentioned two products that I carry: Whisky Stones (moan) and the Pop Quiz Blackboard clock. That clock was actually introduced a year ago; it’s the white “graph paper” version that’s new. I only have three left in stock; should I panic buy? Hardly. The Globe only promotes stuff from bricks-and-mortar stores within the city limits, and their readership has fallen to barely 200,000 people (from over 500,000 just a few years ago). It was worth a Facebook bleat, but nothing more. I’d be happy to move the three that I have left.

Here’s something cheerful: I have a new reason to hate Sunshop. Or maybe it’s just more venom for old hatred; I didn’t check my own post archive.

A customer flipped out after I shipped her order correctly. She had entered different ship-to information in the PayPal interface, but Sunshop ignored it. The ship-to on my packing list was her default PayPal address. It turns out that I had reported exactly the same bug in October 2008. Ah, nostalgia! Turnkey replied then that “we may have to take a look at this”. This year, they invited me to add it to their bug tracker. I swear I feel like I work in software QA again. I wish I was earning that kind of money.

Friday, December 04, 2009

The PayPal Mystery Loop

Today’s post is a bit more disjointed than usual.

Every year I’m amazed anew when the shoppers swarm exactly when the calendar says that they will. Another last-minute stroke of luck rescued November. I kick-started last weekend by accepting a customer’s lowball price offer for all 35 of my remaining dark green 2-LED caps. A superlative 13-transaction Saturday then proceeded to push the month $500 over LY, and the frenzy commenced. I’m hitting 400 visits a day now and routinely closing 20+ sales. That will continue through next week unless I run out of merchandise.

Despite the warning about supply problems that I laid out last week, I'm getting caught short in a couple of areas.
Panther Vision has actually run out of Power Caps (can you believe that?) and their new shipment isn’t due until the week of 12/7…if it clears Customs promptly. Those caps are my bread and butter and meat and potatoes. I haven’t been this low on them in years. I sold out my Peace Sign Ornaments very early on. I'm nearly out of LED Peace Sign Tree Toppers. The sales rep for that company has ignored my last two emails, and now it's too late to reorder.

This December can’t possibly match LY, but I’ve known that all year. This fourth of the Six Weeks of Christmas was better than expected given that the corresponding week LY was supercharged by my NY Times mention. The fact that I’m actually within hailing distance of that high water mark is impressive. My open-to-buy is back in the black and my cash on hand is in five figures. I feel rich!

Facebook has surpassed Octopus Overlords among my top referring sites. Those news bleets that I send out periodically must be drawing a little traffic.

Besides managing the sales rocket, I’m trying to define a couple of bugs prior to going after Turnkey for them.

The PayPal bug: Four or five people have complained of being unable to complete PayPal sales. When they return to Curio City from the PayPal interface, Sunshop takes them back to the account setup screen rather than forward to the checkout confirmation screen. They can’t get out of that loop. I’m still getting the expected number of PayPal transactions so it’s not a general problem. But I figure that for every person who reports the behavior, several more probably give up and either go away or pay by another method. I don’t know how much business I’m losing to the PayPal bug, but I must be losing some.

I can’t reproduce the bug on my own business computer, my gaming computer, or my wife’s computer, using either Firefox or Internet Explorer 8. None of the complainants have yet given me any useful information – they all seem to be low-skilled computer users who can’t or won’t answer simple questions about their browsers and computers. If I can't duplicate it, I can't understand it, and if I can't understand it, I can't fix it. My suspicions, from most to least likely:

  1. It is a cookie handling error tied to a specific browser, probably IE, and possibly an older version of IE.
  2. It is caused by products with Option Stock. Sunshop tracks and enforces the quantities of each separate color or style option for products that have them. PayPal sales complete properly when a customer buys only one variant of a product with options stock, but I haven’t tested it yet with multiple options of the same product. (See the Google Checkout bug below).
  3. It is caused by a virus or spyware on the user’s machine. It’s easy to blame the customer, but they do seem to be inexpert computer users, and those are the people most likely to have infected computers.
  4. It is caused by simple user error, such as completing their bill-to or ship-to information wrong. Again, I’m reluctant to blame the user...and Sunshop should prevent them from leaving the account setup screen in the first place.
  5. It is caused by large sales. I hadn’t had a PayPal transaction exceeding $100 in months. But I got one this week, so I think I’ve ruled this one out.

It’s hard to test PayPal. I can’t check out using the same Curio City account that’s receiving the funds and I don’t have a separate, personal account. I should create one and perform some tests. I obviously don’t have time for that now.

The Google Checkout bug: I recently noticed that when somebody uses Google Checkout to buy a product with Option Stock, the individual Option Stock inventory numbers get updated properly, but the product’s overall In Stock number is not debited. I think that this caused one instance of selling more pieces than I actually had in stock as the program consulted two different on-hand quantities. I don’t have a GC account so I can’t verify this directly or demonstrate it for the developers. It must relate to Google's callback API -- but is the problem on Google's end, or Sunshop's end, or did my last upgrade introduce an implementation error?

The Google Checkout bug suggested possibility #2 for the PayPal bug – since I'm pretty sure a bug exists, it might logically affect both payment types. Both of these bugs most likely appeared with the Sunshop upgrade to 4.2.0. So the ultimate question is whether they derive from an error in the upgrade process, or an error in Sunshop’s code.

Turnkey’s Support forum is full of developers, not merchants, so they never see real-world operational bugs (and most merchants lack the tech savvy to recognize stuff like this). The Turnkey company rep is primarily concerned with denying and disowning bugs, as is the way of software companies everywhere. So their Support forum hasn't been any help so far, and I haven't had time to force the issues.

If you can suggest a possibility that I haven’t thought of, please leave a comment. I'm leaning toward believing that the GC bug is a straight-out Sunshop flaw, but I'm baffled by the PayPal loop.

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