Over the Hills

I’ve written hundreds of columns about Curio City Online over the past 13 years. I haven’t been posting much lately, because what more is there to say? A year ago Blue Hills Editorial Services crept into my blog. Since then, my focus has shifted almost entirely to Blue Hills; last week I removed Curio City from my voicemail message, since I had already stopped returning most phone calls. You want to order a $10 thing but you’re afraid of the internet? I’m sorry. Back in the day, I would have taken 20 minutes to call you and enter the order for you, but the time and aggravation aren’t worth the $2 that I would pocket anymore.

Yesterday I completed a $3,000 editing assignment for a new client (who will almost surely have more work for me). It took me roughly 80 hours over three weeks. When sales are average, Curio City takes four months to pay me $3,000…and sales are (unsurprisingly) running well below average. If Blue Hills can eventually land one project like that each month, I’ll be on easy street.

Most of my clients are corporate, but I do some work for individuals as well...if you ever need writing or editing help, have a gander at our website. I wish I'd made this transition nine years ago, when Curio City first started to stumble. But I have a lifelong habit of riding out doomed situations for too long, mostly because I hate change, and Curio’s fate wasn’t unavoidable until two years ago.
 
Blue Hills has no overhead; 85% of its revenue goes to payroll. Curio City is nearly the opposite; 80% of revenue is lost to overhead. So why is it even still in business? 

Curio income arrives in advance -- shoppers pay when they check out, before I fill their orders. Blue Hills, again, is the opposite. Some clients pay on acceptance, some pay on publication (when they themselves get paid). My most regular customer’s small jobs only rack up $50 or $75 each; it takes me a month or longer just to reach their minimum $200 billing threshold. They then have 30 days from the invoice date to pay, and they are routinely late. I'm still waiting for a $200 check for work that I did in December and billed in January. I won’t see the $3,000 for the project that I turned in yesterday until the first week of May, at the soonest. Curio City reliably pays me at least some pittance every two weeks. 

Corporate clients always pay up eventually. Individuals are chancier. If someone flat out refuses to pay, there’s nothing I can do. That hasn’t happened yet, but it’s a hazard of the freelance business.  It's not like I have a battery of lawyers standing behind me. Unions are not a thing in the gig economy. 

Long delays in payment are okay as long as the pipeline stays full – being owed money well into the future is fine as long as you also have previously-owed money coming in now. Blue Hills isn't steady enough to provide that yet, and will never be entirely reliable: the five-figure project that I was expecting in April got canceled this year because the client’s grant didn’t come through, and they figured out that they could do it in-house. 

So Blue Hills’s success is not written in the stars, although it’s promising. Curio City’s just a matter of managing decline. I think that I can do that gracefully, much as Obama managed America’s decline for eight years, but I can’t rule out a chaotic and catastrophic failure, such as the US is undergoing now.     

The Sale of the Century!

A friend asked if Curio City will have a big clearance blowout at any point. It hadn't occurred to me. Maybe. If so, it won't be until late summer at the earliest. 

Most merchandise is already reduced to near cost. I don't like to go below cost. If I paid $5 for a thing, I want to get my $5 back. Sometimes I might let it go for $4 or even $3, but not often. Isn’t it better to recover a couple of my five bucks than nothing? Not necessarily. Sometimes reducing Kraken Enterprises' profit by $5 is more valuable than increasing its income by $4. 

The first draft of this post walked through the accounting in mind-numbing detail, but I’ll cut to the end without showing you how I got there. Essentially, if I take $4 for that $5 item, I increase my personal income by $0.80, and at the same time I raise my personal income tax liability by $0.80 (because Kraken’s profit/loss goes directly onto my 1040), for no net gain. If I write off $5 instead, I don’t pocket anything, but I reduce my tax liability by about $1. 

In favor of selling below cost anyway, I’d rather have 80 cents now than save a dollar later on. I’d also rather ship the item to somebody than throw it away, and I usually make a buck on the shipping charge. Blue Hills Editorial Services enters the picture here. 85% of Blue Hills income goes into payroll. The other 15% covers the employer's portion of payroll taxes and leaves a tiny profit toward the $1,500 it costs to be a corporation every year. Apart from that, Blue Hills has almost no expenses to offset its profit -- that's where Curio City’s losses are nice to have. When Curio City is losing money on operations, as it’s doing right now, it offsets Blue Hills' profit without needing to take markdowns. I can sell that $5 thing for $4 and pocket my 80 cents without driving up next spring’s tax bill. But when kite season puts Curio operations back in the black, I need write-offs to make Kraken's profit disappear.

I'll talk more about Blue Hills in my next post. To return to what I opened with: I don't plan to have a big end-of-business blowout sale because the write-offs are usually worth more than the small amount of cash that I can get for them. Between now and closing day, individual prices will slide a little bit here and there, but if you see something you want...don't wait. It probably won't get any cheaper, and it might sell out at any time. 

I keep mentioning kite season. Kites sell year-round because there are people who live in warm places. But it really gets going when spring weather settles in. Ordinarily it opens with Christians buying dove kites for church plays. Dove kites have been out of stock since last October, and the manufacturer will only say that they'll be back "in the spring." So I don’t know if I can count on the Christians to kick things off this year.  

Finally: The same person who asked about a going-out-of-business sale also wondered when Curio City will close. I still don’t know myself. The short answer is “It depends.” At this point I'm only staying open in anticipation of kite season. If it doesn't perk up by the end of March, and the cost of staying open continues to exceed the money coming in, I’ll close earlier than I had intended. 

September – the end of kite season -- is the earliest ending that I foresee; Christmas is the latest. But circumstances can change – for example, PayPal keeps sending me technical emails that I don’t quite understand about PayFlow integration, and a friend identified a problem with my security certificate that will, if I don’t do something about it, blow up in either April or June (I’m not clear), but only on the Chrome browser…maybe. Meanwhile, Turnkey just published another Sunshop update, putting my store software at least three versions behind now. Some technical thing might come along and deep-six my site before I’m ready to sink it myself. OTOH, I keep updating my master Excel file each month, and that’s currently formatted through next February, so there’s a ghost of a chance that I’ll keep going into next year. I don't plan to or want to, but I just got word that my biggest Blue Hills job isn’t going to come through this year, so I still need Curio City’s financial lifeline.  

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Speaking of that, I robbed myself of more than $100 last month by forgetting to reset February's payroll percentage from 10 to 20% of sales. Since Curio City unexpectedly bought me a new computer, though, I’m going to let it off the hook for the difference.

What's the Big Hurry?

The next time someone asks me if they can get their order overnight, I'm going to have to say No. Or Maybe, if I'm feeling optimistic. I said Yes twice last week, and Priority Mail Express let me down both times. (UPS air is too expensive to compete.)

The first time was arguably my fault for trusting carrier pickup rather than driving the envelope to the post office myself. Acceptance cutoff for same-day delivery was 5 pm, and they scanned it in at 5:48. Never mind that my carrier had picked it up by 3:30; the one-day package became a two-day package in those 48 minutes, and my customer's son's school project was ruined. A full refund did not delight either him or me.

I drove the next Express package to the post office immediately and got a time-stamped receipt for it, but my diligence (and half an hour out of my day) did not pay off. The package disappeared from tracking after it left the Boston sorting facility that night. It should have arrived in LA the next morning. I was still waiting for an update after the delivery deadline passed that afternoon. It finally arrived a day later, but the tracking never did get updated. Fortunately, that customer was okay with it taking an extra day.

You know who gets blamed when USPS drops the ball? The guy who collected their $30 fee, of course. I don't make any markup on Express packages; in fact, my shipping module seems to be charging the commercial rate whereas I have to pay the retail rate, so I'm losing a couple of bucks on expedited postage. I don't get any extra revenue for the extra work, but last week I took a lot of extra grief. 

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Last week really did end up being my first-ever two-digit sales week, netting just $69 from two transactions. As of this Wednesday, I was sitting at zero after six days in a row with no business. A test transaction went through normally on Tuesday, indicating no technical problems, but I still suspected that something I couldn't see must be broken. After all, Google says that I had 1,600 visitors in January, 2% of whom bought something, and that was a poor month. The dam finally broke on Wednesday night with three modest but reassuring sales. I'm currently sitting on $137 this week, and that feels like progress. 

Historically, these past two weeks are supposed to be among the year's worst. But if this keeps up much longer, Curio City's going to die all by itself and save me the decision to kill it. Monday's paycheck would have netted out to just $52, so I decided to combine it with the next two weeks...meaning February's only going to give me one paycheck, and it's going to be a tiny one.

Fortunately, I just accepted a $3,000 editing job from a new client who will probably become a repeat customer, and yesterday I earned $200 on a rush job for another client. I still expect a mega-project in the middle of March, and I have feelers out for a couple of other jobs. Work completed in March and April won't pay off until May or June, but it will pay off bigly -- it would take Curio City nine months to pay me $3,000. If the Blue Hills pipeline keeps filling up, Curio City will be a distraction by this summer.  

(And yet, I just finished setting up my January 2019 Excel sales page. I really don't plan to use it, but I'm compulsive.)   

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This is going to be my last candid post about Curio City for the foreseeable future. After Blogger autoposts this to Facebook (and Twitter, apparently), Sunshop will put a link to it at the bottom of my store's main page. Almost nobody ever clicks those links...but reading about a failing business will surely repel the few shoppers who do. Humans naturally support winners and shun losers -- that's why third parties never prevail in winner-take-all elections, no matter how unpopular the mainstream parties are. I can't risk being shunned during this sales slump. So next week I'll post something positive about Curio City -- I'm incapable of lying outright, but I can generate happy talk. The following week I'll plug Blue Hills. Once those two upbeat posts are linked, I'm not going to post any more gloomy news that will knock them off the page...at least, not for a few weeks. 

I Can't Complain

Oh, sure I can...but I won't. The cathartic "Things I Hate" post that I've been picking away at will stay personal because:

1. It doesn't say anything I haven't said before;
2. Nobody likes a whiner;
3. It boils down to one word: "People"; and
4. Nuisance calls have dropped off noticeably since I shut down AdWords a few weeks ago.

This Monday's Curio City payday was so small -- $48.79 for two weeks, before taxes -- that I didn't even bother creating a check. I'll fold it into my next payday instead. I'm sure this has nothing to do with #4 above.

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MIT approved my invoice for the work that I did in early August. When that check lands, I will have earned twice as much this year as I did last year...with three months left to go. It's still chicken feed by normal people's reckoning, but having a lot more chicken feed is a big deal to me. 

A web publisher dangled a regular, 15-hour-per-week editing gig in front of me. It's the second time this year that he's approached me and then backed off after an initial conversation. I haven't worked regular hours in at least 13 years, so this would be a big deal to me, too. I won't give up near-complete control over my schedule unless the job feels right, and this one's "on-call" requirement beyond the regular hours makes me nervous. He's also under the impression that one can edit seven to 10 1,000-word articles in three hours. I can proofread that quickly, but nobody can properly edit 1,000 words in 20-25 minutes. I probably put him off when I said that it takes an hour to copy edit 1,000 words if fact-checking is included; that's realistic (in fact, I just spent 2.25 hours giving a 1,700-word article the full treatment), but I don't think it's what he wanted to hear.  

I'd sacrifice some of my autonomy to turn Blue Hills into a reliable paycheck, but I won't make a vaguely defined commitment or exaggerate my productivity. After a few emails he said that he's thinking about hiring a staff editor instead, and left with it "I'll be in touch," so that's the end of that...for now. If he does come back for a third round, I'm going to make sure it happens on my terms. 

You Can Take Him Out, But You Can't Dress Him Up

Last week I had to put on my only pair of big-boy pants and drive into Cambridge for a meeting with Lemelson MIT, Blue Hills' most lucrative client. Since Anne works at MIT, this was a routine matter for her, but driving into the city is always a white-knuckle experience for me. More to the point, this was the first business meeting I've had to attend in at least 13 years. Since my previous two jobs didn't require business attire, all of my "nice" clothes are 20-25 years old. I only ever wear shorts and T-shirts during the summer or jeans and flannel shirts in the winter. Fortunately, Greater Boston is not a fashion Mecca (and, hipsters aside, Cambridge is even less so), men's styles don't change drastically over time, and nobody cares what a 60-year-old man looks like as long as he makes the effort to conform. The main problem is not so much that my "nice" clothes aren't very nice, but that they don't fit very well because my girth has expanded over the decades. 

If my new profession is going to require more meetings, though, I'm going to need to buy some new clothes.

I am tickled that MIT is paying me, a person with only rudimentary education and no science training whatsoever, to write technical articles for a lay audience.

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Hard to believe that it's time for Curio City's July numbers already. The first really substantial Blue Hills activity renders my usual QuickBooks report meaningless...but, just for yucks, here are the numbers for Kraken Enterprises:

July

Total income: +396.6
Payroll: +1,508.9%

Marketing: -12.2%
Net Income (Profit) vs LY: +89% (+$149)

Actual Profit/Loss: -$18

2017 YTD

Total income: +74.1%
Total COGS: +7.1%
Payroll: +297.2%

Marketing: -22.6%
Net Income (Profit) vs LY: +205.1% (+$4,359)

Actual Profit/Loss: +$2,234

Pretty amusing, huh? Excel says that Curio City ended July short by $1,100, but the YTD is still running $1,200 ahead of LY. Curio City is still $3,800 in debt, though, and I'm not entirely confident that it will ever dig itself out. Ultimately, I might have to poach some of my Blue Hills revenue to pay off the Amex before I can close Curio City next fall. 

(I should mention that, for the first time ever, I didn't pocket all of the payroll. My wife is officially a sometimes-employee when she takes income under the Blue Hills name, and I actually wrote out a paycheck for her this month. This is particularly funny since all of Blue Hills' business comes from her contacts and reputation.)