Blood from a Turnip

Attentive readers might realize that I’m looking for a way to jazz up my sales without a lot of expense or risk – to dip a toe slightly outside my comfort zone, as it were. This month Facebook advertising flopped and I successfully resisted assimilation by the Amazon collective. I was wondering what to do next when a SEO salesman called. Ordinarily I terminate telemarketers the moment they say “How’s your day going?”, but this one’s timing was lucky. I let him pitch me the usual complementary site analysis and follow-up phone call.

Typing those letters is like throwing chum in shark-infested waters. Telephone spammers will frenzy minutes after I hit the Post button. So be it. Search Engine Optimization has been on my to-do list for years. I’m not clever enough to implement most of the free advice that I’ve been given over the years, even when I can understand it, because a PHP shopping cart isn’t as straightforward as a plain HTML website. Consequently I can’t do much more than write keyword-heavy product descriptions and plug meta phrases into Sunshop’s provided fields. I know that I need professional help if I'm ever to get serious about SEO.

Nathan satisfied me that his company is thorough, knowledgeable, and non-sleazy. They don’t use link farms or make grandiose promises. Their analysis ranked me at 53 on a 1-100 scale where anything under 40 is pathetic and 70 is well-optimized, so I’m already doing better than I would have expected. I’m quite sure that they could improve my natural search rankings and, eventually, my sales. The big question is affordability. Tight cash flow is a common lament in this blog. SEO is a long-range prospect; improvements made today don’t bear fruit for weeks and it takes months for incremental sales increases to add up, yet the bills are due immediately and in full.

We’ll talk cost next Monday. I’ve warned Nathan that I’ll have to put him on hold, if I can even do it at all. Payroll taxes are due in April. I already have nine vendors on my new product wishlist, and tomorrow’s Cavalcade of Crap might add even more. I need to reorder four of my mainstays. And Intuit wants $184 just because. That gobbles up any free cash in April and probably May as well…and then we’re in the summer doldrums. But he’s a salesman, and he smells blood.

(Incidentally, as a longtime blood donor who’s homing in on his 4 gallon pin, I offer this disclaimer from Wikipedia: A turnip cannot be coaxed, squeezed, or cajoled into producing blood. All efforts at obtaining blood from this vegetable will be futile. There's no substitute for rolling up your sleeve.)

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Reasons to hate UPS: An envelope from the UPS Dimensional Adjustment Bureau is not the exciting science fictiony thing that its name suggests. It ordinarily heralds a surcharge for a package measurement error. Miracle of miracles, this particular envelope held an unexplained check for $1.55. Why is this a reason to hate UPS? Because they issued and mailed a paper check that I had to endorse and schlep to the bank’s ATM; the bank had to process it and return it to UPS; and UPS presumably has to reconcile their account...all of which must cost more than $1.55. Why didn’t they just refund my credit card? They never hesitate to charge it when an alleged error is in their favor.

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Reasons to hate Quickbooks: For $184, Intuit would like to sell me some new bloat that I’ll never use and keep my current install fully functional for three more years. The only “services” that I use are emailing purchase orders and invoices directly through QB, and automatically downloading bug fixes. $15 per month to preserve a “service” that I might use two or three times is not exactly a good value; I can easily save documents as PDFs and email them myself. OTOH, Curio City is essentially just a website, a MySQL database, and a Quickbooks file. I feel compelled to keep those components up to date even when there’s no clear benefit. I suppose I should shop around and see if anybody sells it below Intuit’s $184.

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Here’s what $350 of Facebook advertising finally bought me:

•    391,111 impressions;
•    141 “social impressions” (impressions shown with the names of the viewers’ friends who Liked my page);
•    93 clicks (Not according to Google Analytics, but OK, if they say so);
•    4 people Liked my page;
•    And, of course 0 sales.

On the Eighth Week of Christmas, My Business Gave to Me...

...An eighth week of Christmas!

Christmas ended on the 21st this year, a full four days later than I had expected. I more than recovered Week 7’s shortfall and averted my first-ever year-over-year sales decline (2011 will finish about 2% over 2010, assuming that next week is merely average). These “extra” days amounted to an unexpected extra week of Christmas. I am incredibly glad that it’s finally over for another year, apart from the enjoyable massaging of numbers. Nice, black numbers. I’m going to miss the big daily bank deposits, though.

Reasons to hate UPS (redux): Yet another Credit Card Billing Adjustment, this time increasing a charge by $11 with no explanation. Ever notice that these adjustments are never downward? 

Well, at least I can take some small revenge: I finally discontinued UPS Standard after reading multiple complaints about it being a scam. UPS tempts Canadians with a reasonable-looking rate. Then, after the package crosses the border, UPS holds it hostage for brokerage fees that approach 100% of the shipment’s value. If the recipient declines to pay it, they offer to return it to the shipper – me – if I will pay the fees. When neither party wants to pay the ransom, UPS gets free merchandise. Virtually every international complaint I’ve had over the years has come from a Canadian, and the majority of those were UPS Standard shipments. Customers usually think that I’m in on the scam. No more.

For the time being I’m leaving Worldwide Expedited and Worldwide Express in place because they’re so expensive that nobody ever chooses them. But I might ultimately remove those, too, if they employ the same “brokerage” trick.

Reasons to hate Google (redux): I ended last week not knowing whether or not Google Product Search was going to exempt my site from their item identification requirement. On Monday they suspended my products. On Tuesday they told me that my exemption had been approved, but not whether my items reinstated or not. On Wednesday I was invited to rate their responses. Hee hee.


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Born yesterday? I was not. A suspicious email asking about international shipping led to somebody wanting to buy thousands of dollars worth of stuff to be picked up by his private courier (after he pays with a stolen credit card, obviously). There was some creative aspect involving shipping to Cyprus and prepaying customs duties and whatnot, too. It was probably just meant to confuse me, or maybe to make him look like a legit businessman. Bzzt! Sorry, find another sucker. 

On the Seventh Week of Christmas, My Business Gave to Me...

A seven-day warning/six days of sickness/A five-digit month/four minutes offline/three giveaways/two gorgeous days/and a big rusty pail of fail.

Last Saturday set the YTD record number of sales with 23, but their paltry size led to a merely average day in dollars. Saturdays are historically the slowest day of the week. People bought almost nothing but Whisky Stones and lighted caps, and usually only one. At least that made the weekend’s business easy to process; 50-some packages fit neatly into two big boxes. In past years, before I learned not to sell bulky things, they would have overflowed the living room.

But this make-or-break week started on Sunday, as weeks tend to do. I went into it $1,400 ahead of LY (according to Excel, whose numbers are more dear to me than Quickbooks). Here’s the blow-by-blow for those who wish to recreate the anxiety:

•    Sunday’s paltry 11 sales brought in only $565, blowing $300 of my lead, but at least the average sale was back up where it belongs. Running total: +$1,100;
•    My car’s radio said that Monday was supposed to be “Green Monday”, the second-biggest online day of the year. I was indeed up against a 4-digit day LY. It flopped and set me back another $800. Uh-oh. Running total: +$300;
•    Twenty-seven sales on Tuesday – henceforth to be called “Green Tuesday” – racked up the second-busiest day of the year (and the high point in number of sales) and clawed back $250. Running total: +$550;
•    Wednesday should have been the last four-digit day of Christmas. People made a nice run at it, but I still dropped another $270. Running total: +280;
•    I beat Thursday’s modest target by $40 for +$320 on the year.
•    Today was much stronger than expected; I’m up $170 with the whole evening yet to go. Tomorrow is basically a throwaway.

So Week Seven is going to finish somewhere around $800 behind LY, but that still leaves a YTD surplus of roughly $500. Although I call next week the Eighth Week of Christmas, it’s really just a cooldown period.


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And what would Christmas be without some new hatred?

Reasons to hate UPS – O UPS, why do you play games with me? When my customer’s 2nd day air package arrived with a big bootprint and crushed merchandise, I was peeved. Because this particular customer is of the variety that will not use email, it took two days to straighten out her complaint over the telephone and generate a $35 loss. When I filed a damage claim and you processed it almost instantly, I forgave you. When you called to tell me that the paperwork had to be resubmitted because I had sought $25 for a $24.99 item, I was peeved all over again. But I understand that computers can’t tolerate discrepancies and the penny difference was my fault, so I forgave you again. Two peeves, two forgivings…that’s a wash. Then you had to go and email me a Credit Card Billing Adjustment report with $12.45 in upcharges. I swear that the address you call residential was a business according to the USPS – yes, I really do check. But adding a rural delivery surcharge to the very same package that you damaged cinched your new Reason to Hate.

Reasons to hate Facebook – Facebook recently changed from reporting each post’s impressions to showing “people reached” – i.e., unique viewers. I used to see over 100 impressions, which jibes with my 138 “likers” pretty well. Now I see that I’m really only reaching 27-32 people, two of whom are me; more than 100 people that I thought were following Curio City are actually blind to my posts. I’m pretty sure that happened when Facebook introduced the “top stories” interface; any “liker” who hadn’t interacted with your page recently got dropped. The 25 or so people that I’m reaching now mostly “liked” Curio City after that change. I don’t know what, if anything, I can do about that…Facebook’s interface is largely impenetrable to me, and it’s constantly changing anyway. All I know is that it’s not nearly the communication tool that I thought it was.

Reasons to hate Google – Back in May, Google Product Search (formerly Google Base) added a requirement that most products include a unique identifier – either the UPC or a manufacturer’s number. Sunshop did not support those fields at that time, so I had exactly zero. I started adding numbers for new products and reorders after I finally upgraded to a version that included them. Well, last Sunday Google spoke: “Your items are at risk of being suspended.” They gave me seven days to supply the missing data, after which they’ll review my items again. Needless to say, I did not have very much time during the busiest week of the year to look up 600 useless numbers. So I petitioned Google for an extension. Their cryptic response, signed with an Indian name, left me unsure whether they’re going to nuke my products or not.


Does it matter? I really have no idea how Google Product Search works or if it sends me any business at all. But I’ve been submitting a data feed every month for years. Between paid search, natural search, and (maybe) Product Search, Google drives over 80% of my business. I must appease the Google gods. It’s their internet, after all.

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Finally, a friendly tip for marketing people: Email with the subject line “Happy Holidays” always gets deleted unread.

Good Riddance to Bad Elves

Christmas finally died last Tuesday after a long illness. It will not be missed. After a second consecutive December decline, I’d love to hibernate until Valentines Day…but when the self-employed rest, we lose. I am already pondering how to better cash in on next year’s spending orgy.


Since my past few posts were so number-heavy, and since I'll have the year-end wrap-up next week, and since I’m currently suffering yet another lousy week, I’ll spare you the nitty-gritty today.

I only lost one Christmas shipment this year, sending a $10 item to West instead of East (Whatever) Street in NYC. UPS apparently lost a 2nd-Day Air shipment this week, although I haven’t confirmed that yet because the customer fell silent after her initial complaint (she’s traveling). Otherwise everybody’s packages got where they were supposed to go. That’s 235 packages in November and 410 (so far) in December. With one more crappy week left in this crappy month, I should end up very close to LY’s 705 shipments – the monetary decline reflects the Curse of the Small Orders that I identified a couple of weeks ago, not an absence of customers. (I’m sorry, I said I was going to skip the statistics!)

The three thefts and two cellar floods that washed more than $1,000 off my bottom line were this year’s lows. New fraud control will prevent those scams from being repeated, albeit at the cost of rejecting some legitimate sales – APO addresses in particular usually fail the metrics (sorry, soldiers). Pray to Neptune that global warming won’t raise the waters again next year.

At the beginning of 2010 I had set myself the goal of acquiring 100 Facebook “fans” by the end of the year. As of today I’m at 112. FB changed “become a fan” to “Like” midway through the year because “liking” something is a lesser commitment than “becoming a fan” of it. The effect is the same, but the goal was easier to reach. FB seems to be spreading of its own accord now – not that I don’t still need the active support of my FB “likers”.

Other items on my 2010 agenda were:

Drop international shipping: Nope, didn’t do it. I was sorely tempted after this year’s thefts (all of them by foreigners), but I’m still reluctant to cut 1-2% off my top line. I'll reconsider if sales recover beyond expectations.

Drop Google Checkout: Nope. In fact, my GC business grew slightly last year. That’s fine; their processing fees are slightly lower than the competition. I hate to see so many of those customers drastically overpay for shipping because of Sunshop's flawed GC integration, but I’m not going to lose sleep if it doesn’t bother them.

Drop Giftwrapping: Nope. In fact, I sold $8 more worth of giftwrap this year than last despite lowering the fee and removing the option from many products. The $124.50 that it brought in is trivial when merged into general sales…less so when committed directly to payroll. Unfortunately, the floods forced me to replace $94 worth of destroyed paper, so the company barely broke even on the deal. I am dropping it from everything that’s bulky or odd-shaped, though.

Cosmetic Facelift: Nope, the unexpected expenses torpedoed that. It's probably for the best, since Turnkey seems to have abandoned the Sunshop template that I was going to adopt. It’s still on my wishlist for next year.

Discontinue Greeting Cards: Yup, wrote those suckers off and folded the department. I might not have done so if I’d known about the other losses 2010 had in store…but I’m glad they’re gone.

Another Raise: Yup, I increased payroll in two steps from 19 to 20% of net. That’s why my paycheck set a record this year despite lackluster sales.

In a couple of weeks I’ll publish a similar punch list for 2011.

Although I don’t celebrate Christmas myself, neither do I fight it like I used to. Why try to harsh everybody else’s buzz? In observance of the holiday (and the impossibility of accomplishing anything this weekend anyway) I’m taking this afternoon off. I’m finally going to finish moving into the new computer that arrived just before Thanksgiving. I might even treat myself to a new game next week...it would be my first in years.

Next week: Counting the money and planning the plan.

The Turkey Month

First there was Black Friday, and it affected me not at all. Then there was Cyber Monday, and it affected me not at all. Now, courtesy of American Express, there is Small Business Saturday. Anne told me about it last Sunday morning. I signed up for a free $100 Facebook ad even though the promotion supposedly ended three days prior. These geo-targeted ads hawk physical stores, so it should affect me not at all. Even though the “official” promotion is a non-starter, I sent out a newsletter with a coupon that I still hope will spur more than the one sale it has garnered so far.

When we last saw Week Three, it was dragging behind LY by $850 with a day and a half left on the clock. I had hoped to narrow down that gap by the $450 that I racked up during the corresponding two days last year. But a good Saturday couldn’t make up for Friday’s embarrassing $40 total and the week ended down $600 – my biggest Christmas shortfall yet this year. It would’ve been a weak week even without that $160 customer return blowing a hole in the middle.

Last year a single $1,000 day pushed the otherwise lackluster Week Four (Thanksgiving week) over the top. This year a surprise $750 lighted cap order placed on Thanksgiving morning kept Week Four in the game. Now I just need average November sales on Black Friday and Small Business Saturday to finish the month very close to LY. (My weird accounting calendar puts Sunday the 28th in December).

November:

Total income: -3.7%
Total COGS: +3%
Payroll: -7.8%
Net Income (Profit): -3.9%


Year to Date:

Total income: +12.1%
Total COGS: +23.2%
Payroll: +29.4%
Net Income (Profit): -59.3%

UPS plumped up my COGS last week by losing an incoming shipment worth $124. I’ve filed a claim for reimbursement, but even if it goes through I don’t have that merchandise to sell and I’m carrying a $124 inventory shortage on my books. This year has thrown me one such curve after another.

Inventory shortages made December '09 weaker than expected. That means there’s still a chance that this December will repair the damage of the past few months and get Total Income back to my +15% goal.

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The 900-pound gorilla who’s paying obscene bids for lighted cap keywords turns out to be an amazon.com seller pushing the cheap 2-LED version that Panther Vision created for the promotional market. Although he must be doing amazing volume, he can’t be making much money between his bargain prices and ridiculous advertising costs. Since I don’t carry that inferior product line he’s not a direct competitor at all. He can have his $2.00 clicks. In fact, I gave him a few clicks just for fun.

The manufacturer of Buckyballs is freezing out competition with an absurd $4.00 per click bid for that keyword. The maximum financially justifiable bid for that product belongs in the 50-60 cent range, and 40-45 cents is more realistic. They solicited retailers, required us to sign a price maintenance pledge (no discounting), and then kept us little guys from advertising – pretty slick! I’ve sold a few sets, but it’s nowhere near the star product that it should have been. I’m not going to need a single reorder. I should have believed the instinct that told me it was too mainstream.

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And now I have a personal confession: My attention is not 100 percent focused on Curio City right now (shocking, I know).

My sole hobby is PC gaming – specifically strategy and epic-scale wargames, not the action games that kids play on consoles. When I worked in the industry, I needed to replace or upgrade my gaming PCs every couple of years. But when I traded the lucrative world of game development for the impoverished life of a self-employed shopkeeper, I lost both the compulsion and the means to keep my gaming machine up to date. My current 7.5-year-old gaming rig hasn’t been able to run anything new in the past three years.

Civilization 4 and Galactic Civilizations II are both wonderful games, but even with mods one can only squeeze so much gameplay from them. And so, despite my busy season (and biggest paychecks) being hard upon me (and with the tragically flawed but still compelling new Civilization 5 enticing me) I raided my ever-shrinking savings account to buy a new PC two weeks ago. My screaming new machine arrived from Cyberpower Tuesday night.

To say that both Thanksgiving and Curio City are distractions from what I really care about is putting it mildly. In the three and a half days that I’ve had the machine I’ve only managed to devote a few hours to setting it up…with almost all of that time troubleshooting its network connection. Getting a Win 7 machine onto an XP network is turning out to be trickier than I expected since I’m a newbie with the latest OS and not very good at networking in the first place.

Anyway, as soon as I get today’s orders on their way I’m spending the rest of the weekend doing what I want to do, rather than what I should be doing. I hope that I’ll have the new beast fully up to speed and ready for gaming by Cyber Monday.

I Like Spikes

I’ve had about 70 Facebook followers (formerly “fans”, now “likers” I guess) for half a year now. That number only fluctuates by a couple of people one way or the other. Yesterday it spiked to 82 people. Momentum! With your help I might reach my goal of 100 fans by the end of this year.

Who are you?

• 60% of you are female and 39% are male. The other 1% are either confused or a rounding error.

• Women aged 45-54 are the single biggest demographic at 21%. Women aged 55+ are the next biggest at 14%. Men aged 35-44 are third with 12%. About 14% of you are under age 25.

• Each one of you contributes 1.28% to the total.

• 83% of you are in the US. Malaysia, Peru, Chile, The Philippines, Venezuela, Panama (hi Rob!), the UK, Cyprus, and Mexico are also represented. I’ve shipped to all of those countries, although Malaysia is now blacklisted as a high-risk country.

How can I get 18 more followers and reach 100 in the next few months? I seldom post apart from my weekly blogcast, so that must be what draws new fans and repels existing ones. For a time I tried posting new product arrivals and stock status updates on FB, but I think that got annoying quickly – I have a low tolerance for advertising myself and am leery of wearing out my welcome. Announcing real news, such as vacation dates or discount offers or this weekend’s Massachusetts sales tax holiday, seems to be the best use of FB.

Facebook would love to sell me advertising. The cost is modest and the effort is slight. But what exactly would I advertise – my page? My store? A product? Who would see these ads and where would they appear? I’ve never seen an ad on FB myself. Of course, AdBlock for Firefox keeps me from seeing most ads anywhere, and apart from trying to figure out the marketing angle I don’t get very involved in FB. I have no idea whether or not there’s any value in advertising here.

Is it even worth reaching for 100?

Referring sites are one of my favorite free traffic sources. Nearly 12% of my visitors arrive via links from other sites. Facebook sends Curio City 25-30 visitors a week and is my #3 referral source. Since 3% of visitors buy something, FB delivers 3-4 sales per month (possibly more, since those visits are presumably motivated by posts that I make). That’s a typical day’s business during the slow months – not shabby at all.

Gaining 18 more FB followers would generate 0.6 more sales per month. OK, that’s not exactly the road to riches. But followers beget more followers – there’s a snowball effect that will eventually sustain itself. I think that threshold is around 100.

So if it’s not too much to ask…get out there and get begetting! Go to our page in your Favorites list and click “Suggest to Friends” beneath our logo. If you didn’t arrive at this blog post via FB, use the “Like” button near the top of the right-hand column to join.

Oh, and as long as I’m begging…don’t forget to click those ads between posts.

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Last week I mentioned that I’d spent $11 to intercept a fraudulent UPS shipment. It actually cost $11 for the interception…plus $35.05 for return freight…plus a $2.80 fuel surcharge. I suspected that they might bone me for return postage, and that they’d charge a premium for air shipment. The fuel surcharge is just plain insulting, though.

That brings the total cost of this criminal to $130, almost all of which went to UPS because I shipped too promptly. I’d have lost less money if I’d just let the thief have the merchandise, but the satisfaction of denying him anything tangible for all the trouble he caused is worth the cost.

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.


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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.

The Halloween Ball

It’s funny, how products sometimes blow up out of nowhere. I’ve carried novelty golf balls since the beginning. A few months back somebody bought enough Halloween balls to propel that style onto the bestseller list (they do sell year-round). This week a blogger in Italy picked up on them (see the 29 Ottobre 2009 post). I can’t read Italian, but I do know that her link works. Links are good. Creating product links is part of this blog's reason for existing. Even if none of her readers buy anything from me, that link will raise the page’s stature in the all-seeing eyes of Google. Halloween is over, so that should be the end of it…but who knows where it will really go from there?

I’ve explained that I don’t particularly like international sales. I lose money on the currency conversion, the charge processing cost is higher, the shipments take considerable time to prepare, and I am supposed to hand the parcels to a postal employee, which means either scheduling a carrier pickup or (shudder) standing in line. Last week I stood in line with a package to Denmark and one to Canada among my domestic shipments. One clerk was working the counter while three others bustled around officiously. The working clerk was tied up with an old woman who apparently had set aside her whole afternoon for the post office. Eventually a manager-type came out and started trying to steer people toward the automated postal center. He couldn't take my international packages, though – those had to be handed to a counter clerk, he said, and he couldn’t hand them off for me. :rolleyes: OK, whatever. Finally I made it to the front. The clerk took my packages, and then told me that he couldn’t scan in labels purchased online because those are already “accepted”, technically. From now on, I’m going with carrier pickup, even though it adds an extra day.

Which brings up a new reason to hate both Canada and UPS – a twofer! A customer paid $39.98 for two sets of Whisky Stones – which is to say, rocks. Postage to Canada was $16.15, bringing it to $56.13. Converting to Canadian funds made that $60.76. And then Canadian Customs hit him for $36.49 in import duties. Bottom line: $97.25 for 18 pieces of rock. They’re nice rocks, but wow.

I strengthened my international shipping wording. Truth is that this seems to happen to everyone who chooses UPS Standard to Canada. USPS shipments are less likely to be intercepted. I don’t know whether that’s Canada’s fault or UPS’s, and so I shall hate them equally this week.

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I went back to manual click bids after seeing some weird money allocations from Google’s conversion optimizer. I only had the nerve to stick with it for four days. My daily spend rose by about $4 per day. On three of those days I got the usual 50-75 clicks. On the last day I got 83 – a little better than average. I did make three international sales during the period, which is also more than average…but that’s hardly desirable. I think I’d have to run this for at least a month to draw any conclusions, and that’s a more expensive experiment than I care to perform. Maybe I’ll try it again during the slow season. Or maybe not. I don’t really like surrendering control.

October was a phenomenal month. I wish that the changeover from 2-LED to 3-LED lighted caps could go on forever. Sadly, the old ones are selling out, and that’s going to take some wind out of November’s sails.

Of course it all comes down to November and December, but here’s what it looks like going in. Remember, this year’s plan is +25% growth (reduced from 33% when the economy collapsed).

For October:

Total income: +58.0%
Total COGS: +61.2%
Payroll: +232.5%
Net Income (Profit): -50.1%

The YTD numbers:

Total income: +24.2%
Total COGS: +21%
Payroll: +44.2%
Net Income (Profit): -37.4%

I continue to steer more money into my paycheck at the expense of my year-end profit -- not the optimal tax strategy, but I need every penny while Anne is unemployed. COGS is rising more slowly than income. And income is very near my 25% growth target. Pretty good numbers all around.

The next two months will decide next year’s plan. Tentatively, I’ve set it at 30% growth, but I might lower that if Christmas is a bust.

Whining, Grumbling, and Griping

My inventory reduction effort is not making any headway yet. Only golf balls and kites are selling with any regularity now. Even my old standby lighted caps are becalmed. I’m nervous about those. Panther Vision said that they’re slow, too, but that their business usually recovers in June. Let’s hope so; no other product is in the same league. Oh well, the newspaper says that retail sales fell more than expected in May. Maybe the depression is finally catching up with me. I certainly did not see the Fathers Day bounce that I was expecting this week; June is off to a very poor start.

Incidentally, I’ve carried those bird kites since I opened Curio City, and this is the first season that they’ve sold in any quantity. My pay-per-click bids must have finally reached the critical threshold.

The point of all this is that every time my open-to-buy recharges, I have to spend it on golf balls, kites, or caps. I could easily drop $2,000 today to replace merchandise with a decent sales history, and I have 20 catalogs with wishlisted new stuff stacked up...but my OTB is a whopping $679 this morning. I need to reorder $1,440 worth of caps to get optimum pricing, and I’m trying to reduce inventory, remember? Going $800 into the red is not going to help.

Maybe I’ll order fewer caps and swallow the higher unit prices. Maybe I’ll bring in one new product line today. These wooden puzzles that I’ve been eying for years have a free freight special ending today, and their minimum order is only $100.

Advertising costs (meaning PPC bids) keep creeping up faster than sales are growing. Google routinely runs $10-12 per day, and Yahoo adds another $3-4. The temptation to kill Yahoo Search Marketing grows stronger every time they hit my credit card. I don’t think that the $100 per month I’m spending there is driving anywhere near the $1,100 worth of sales that would justify it. I hate to do anything that I know will reduce traffic and sales. But the next time my account runs dry, I’m going to mothball it for a month and see what happens. What better time to try this than the summer doldrums?

I could shut down Constant Contact, whom I pay $20 a month for the capability to send out newsletters. The past three newsletters brought in no known sales. Maybe I suck at newsletters…but it does seem like a waste of money and time. I just sent out 281 emails this week. The 86 that were opened (30%) generated 29 clicks (34%, or barely 10% of the total distribution). AFAIK no sales resulted. Those are very typical numbers.

QuickBooks Pro 2009 is sitting in front of me right now, mocking me. Apparently I foiled Intuit’s evil plan by turning off the auto-updater; my copy of QB 2006 is not visibly crippled. I don’t want to go through the upgrade hassle that I wrote about last week, but I do own this $95 piece of bloatware now. I suppose I must hold my nose and install it next week. I'll soon see just how justified all the griping was.

We haven’t had a new reason to hate UPS for a few weeks, so here’s one: my application for the UPS-affiliated Visa card was rejected. It’s hardly surprising, given that my personal income is about 1/3 of the federal poverty line. But I think my main mistake was applying before my Advanta card was actually closed. Two of the three reasons given involved having too much available credit for my income. OK, I know that UPS really had nothing to do with issuing credit cards…I just thought they were overdue for a little more hatred. Maybe they’ll at least stop soliciting me every four weeks now.

I ought to have a Mastercard or Visa, but nobody’s raining down offers in this tight-credit economy. I could probably get the crappy PayPal card (pays off in “rewards vouchers” that are only good on PayPal purchases), or maybe one from Citizens Bank (anemic rewards program and no online application – I’d have to go inside a bank and talk to a human? No thanks!). No, for now I think I’ll lean on my business Amex and use my personal Chase Mastercard (cash back, yay!) where Amex isn’t accepted. Eventually the credit market will recover and I can get a decent card. Who knows? Maybe Advanta will even come back someday.

Long Post, Eventful Week

Sheesh, what a week. Let’s take it in pieces.


Baking Babies

I've started buying groceries at Shaws again because Stop 'N' Shop is reorganizing. Nothing is where I'm used to finding it. Shaws is a worse store in most ways, but at least I know where everything is there. S&S just relocated the bread aisle across from diapers and baby supplies. Yech! Now instead of smelling baked goods, I smell talcum powder. That’s just nasty.

I have wished for years that Curio City's navigation bar would show any associated subcategories when you click on a main category. Commissioning a programmer to implement that would have cost more than it's worth. I've known for some time about a free software "mod" that adds that functionality. The catch was that I would have to do it myself. It was pretty scary looking.

This week I gritted my teeth and made the prescribed changes to Curio City's SQL database, six program files, four templates, and the style sheet. Lo and behold, it worked on the first try! Not bad for a retailer with an English degree and no technical training.

The bad news is that, like the Stop 'N' Shop, Curio City's going to raise a little dust moving things around in the coming weeks. The good news is that the layout will make more sense, be easier to navigate, and please the search engines more. I just have to make sure that the bread aisle won't reek of babies.


The Cavalcade of Crap Rebooted

Tomorrow is the Boston Gift Show, known to Curious Business readers as the Cavalcade of Crap. Yes, I’m taking the T into Boston and walking from South Station to the convention center, where I will waste the whole day shuffling like a zombie through aisle after aisle of boring consumer trinkets. The Fall ’08 show was canceled after steadily declining participation. Its new owners are trying hard to revive the tired old event…obviously an uphill struggle in this business environment, but isn’t everything? Throughout March I rebuilt my open-to-buy from -$350 to over $1,000 in the black. I’ve got my eye on one new product that will take $120 of that, and I’d like to place about $2,200 worth of reorders. But at least I do have money in the bank in case I find something really great tomorrow.


I Am Not A Lousy Month

This week surprised me with not just one, but two, very large sales. I sold 71 I Am Not a Paper Cups to a marketing firm near Chicago. The UPS tracking site assures me that they were delivered to the UPS Store yesterday afternoon, so I can reship them this morning. The product is made by DCI, the same company that was behind the great Christmas tree debacle. So I won’t believe that the correct merchandise arrived in the correct quantity until I actually drive over there this morning and see it.

Two days later a gentleman organizing the 2009 Turkey Ridge Youth Hunt in Kansas bought 50 camo caps. (Presumably the youths are hunting turkeys, and not themselves being hunted.) Twenty-five adults and 25 youths participate. It was pure luck that I had exactly 50 of these caps in stock when he called (not the 53 that my spreadsheet indicated). A 20% discount and rapid order fulfillment sealed this deal.

I get about one of these institutional inquiries a month, but they almost never pan out – people almost invariably want imprinting/embroidering and deeper discounts than I can afford. I was quite surprised when the first sale went through, and downright stunned by the second in one week. Even after the hefty discounts, this week’s net sales will approach the entire month of March 2008.

March had been looking really anemic before this lucky break. I thought I was going to fall short of LY. This big shot in the arm put me comfortably ahead of my YTD sales plan. Awesome…for now.

The year-to-year numbers:

Total income: +72.4%
Total COGS: +97.3%
Payroll: +26.6% (yay me!)
Net Income (Profit): +107%

Year-to-date sales are up 33.3%, gross profit is up 38%, and the bottom line is up 202%. There are even some hopeful signs that the economy might finally be bottoming out.


Two More Reasons to Hate UPS: An order for a 2nd Day Air shipment came in on a Friday. I dropped off the package at the UPS Store on Saturday so that it would go out first thing Monday. UPS helpfully picked it up on Saturday, then unhelpfully billed me $15.38 extra for Saturday pickup. OK, it’s my own fault for dropping off on a Saturday…but $15 to toss it in the truck? So typical of their “gotcha” pricing.

One of the shipping supplies that UPS offers for free is a two-part adhesive label. You can’t actually use them for UPS packages because their shipping label prints out off-center. The labels are perfect, however, for USPS shipping. Over the past couple of years I've recouped some tiny fraction of UPS’s extortionate charges by using their free labels to ship US mail packages. Well, it looks like they have finally wised up. I’ve been unable to reorder labels the last two times I tried. For some bizarre reason, these things are crazy expensive -- $11.25 per 50 sheets if you buy them through the USPS website, and still pricey even at Office Max. I’ll bet I’ve gone through 300 of those UPS sheets between the time that I realized that I could do this and the time that they started rationing. Now I’m going to either have to go back to taping plain paper labels, or find a cheaper source and buy them in bulk.

Bastards.

Avoid of Fraudsters!

My largest single sale ever (for 58 lighted caps) saved this week from disaster and made up for all the refunds I had to give this month. January is going to be OK now. Not great, but OK. If history holds up I should see a very small Valentines Day bump next week.

Yet another reason to hate UPS: The aforementioned customer paid big bucks for 2nd Day Air. I quickly tested all those caps, weeded out a couple of defects, replaced a few dead batteries, and packed them up neatly. Hoping to impress her, I upgraded to Next-Day Air when I saw that the incremental cost was still within the customer’s shipping charge. The box’s value triggered a requirement that I’d never seen before, to hand the package directly to a driver or “a UPS agent” for a signed receipt. I wedged the big box into my Miata for a trip to the UPS Store…who could not accept it, because they are not “UPS agents”. Hmmm.

OK, back into the Miata we went. UPS never misses a chance to charge my account, so I expect to pay extra for this home pickup that they required. Well, whatever. The big valuable box was finally on its way, I had complied with their insurance requirement, and my customer should be pleasantly surprised when her caps arrive a day early.

Since this is a UPS story, you can guess what comes next: My customer emailed me about receiving delivery delay emails from UPS. She wanted her hefty expedited delivery fee refunded. I had to explain that it was still being delivered within the two-day service that she had actually purchased, and only the upgraded delivery that *I* had paid for was forfeit. My pleasant surprise had backfired. I filed a claim with UPS and offered to refund her shipping charge if UPS would honor their guarantee.

As you might guess if you read this post, UPS’s guarantee is not worth the pixels it darkens. Here is their list of excuses:

• Disruptions in the air or ground transportation networks, such as weather phenomena and natural disasters;
• The unavailability or refusal of a person to accept delivery;
• Delays caused by the consignee;
• Acts of God;
• Public authorities acting with actual or apparent authority on the premises;
• Riots, strikes, and other labor disputes;
• Civil commotion.

And so I added a new section to my shipping policy. OK, I can see blaming God and public authorities. But “weather phenomena”? Come on. UPS has obviously never heard of the post office’s unofficial creed: “Neither snow, nor rain, nor heat, nor gloom of night stays these couriers from the swift completion of their appointed rounds.” One might even argue that all of those fine-print exclusions make their guarantee border on fraud.

In other news:

I noticed a pending charge to my business Mastercard for $7.50 from PayPal. That’s strange; I didn’t think I owed PayPal money for anything, and why would they hit my charge card rather than my PayPal account, or maybe my linked checking account? Maybe they were doing a routine card authorization check...but those usually use $1, not $7.50.

When the charge settled, the payee's name changed to Rebatesoft. That’s even stranger. Who? When I googled them I found multiple forums dealing with credit card fraud. Maybe Rebatesoft is laundering stolen credit card numbers prior to selling them. It's unclear whether Rebatesoft is the actual thief, or a willing accomplice, or an unwilling tool. There is a real company called Rebatesoft. Their contact page includes this gem: "Avoid of Fraudsters. Please note what Rebatesoft.com not charge anybody credit cards. All payments going via RegNow.com system. Beware of the fraudsters!"

I immediately canceled my card. Now I’m stacking orders until the replacement card arrives. I could use my Amex instead, but I want to earn my cash rebate.

I used this week’s idleness to (finally) poke around in my new merchant services account. I am ready to integrate it into Sunshop and make the big switch…possibly as soon as today, if I can get somebody to hold my hand. I obviously can’t afford to screw up credit card acceptance.

Further Christmas Screwups (or, Good Riddance to Bad Service)

The worst vendor screwup: Remember the company that double-shipped my initial order of 144 Recycled Motherboard Christmas Trees? Well, not only are those three monstrous cartons still sitting in my living room, freezing $700 of inventory dollars…last week the same company screwed up again and double-shipped another order of 72. Now I have got five enormous cartons of 212 unwanted Christmas trees tying up $1,200. This is heading into its third week without resolution. Naturally, anybody who can do anything about this was on vacation this week. Only we self-employed types work a normal week between xmas and New Years.

Since the vendor seems oblivious and the sales rep seems useless, I am sorely tempted to return the cartons freight-collect and dispute the credit card charges. That would get their attention. It would also poison my relationships with two companies with whom I hope to do considerable business in 2009. In fact, this ongoing screwup is the only thing preventing me from placing a sizable new-product order from Décor Craft right now. I shall phone them and lay down the law on Monday.

The worst product screwup: I mentioned the quality shortcomings of the Amazing Coin Factory Bank in my first screwups post. It looks like five of the 35 that sold are coming back. On Monday I’ll find out if that company’s new sales rep can make good on the old sales rep’s exchange promise, or if I’m going to be stuck with these broken things after paying $10 apiece in return freight. Even if they do come through as promised, this will be the least profitable successful seller that I have ever carried. And if they leave me holding the bag, it will be my worst money-loser ever. Unlike the company that stuck me with 212 unordered Christmas trees, this vendor has always been marginal. I will drop them in a heartbeat. My tolerance for inferior products and service is very low right now.

The most irritating service screwup (or, another reason to hate UPS): Late on the afternoon of 12/22, a customer paid $20+ for UPS 2nd Day Air. She mistakenly thought that she would get her order on the 24th, because she didn’t take into account the time that I need to pack the order. I diligently shipped it early the next afternoon (the 23rd). When she complained on the 24th that her order had not arrived, I explained the logistics and timing and assured her that her package would arrive on the 26th.

It showed up on the 29th. That’s right: 2nd Day Air took six days from door to door. Obviously, I had to refund her shipping charge. Just as obviously, I would recover the cost from UPS. Not at all obviously buried in the fine print of their Terms of Use page is the tidbit that UPS’s service guarantee doesn’t apply to packages picked up from Dec. 12-24. When I explained that my business had to pay the price of their failure, they sent a polite apology with an excuse – but still no refund.

Lesson learned: Never again will I offer expedited UPS services during the holiday week. They are too unreliable.

My own worst judgment screwup: Remember my huge surge in business from that New York Times gift guide? Well, I lacked appropriate boxes to ship all of those orders and delayed ordering them for one crucial day, so I sent out 100+ single-piece orders in padded mailing envelopes. Three of them arrived damaged – two to the same customer…the first via UPS, and its replacement via First Class mail! I did recover the cost for two of those shipments from UPS, but it still inconvenienced my customers and made Curio City look amateurish. I should have waited two days for proper boxes to arrive.

My own most costly screwup: I see that I wrote about credit card processing almost two years ago. Here's a Cliff's Notes refresher: Companies called “merchant service providers” sell service packages to merchants. When a customer uses a credit card, lots of people take a tiny slice out of the sale. The “payment processor” gets the biggest piece.

Have you ever tried to compare mattress prices between two stores? You can't do it. The manufacturers use different model numbers for identical products specifically so that mattress stores never have to meet their lowest-price guarantees. The credit card industry’s cryptic pricing is like that – no two products are identical. I knew that Pipeline Data Systems (who appear in my bank account as CTS Holdings) was on the expensive side. Now that I’m no longer a risky new business, I could do better. But when my contract expired in October I was getting too busy to bother with it, and I’m always loathe to perturb a system that works smoothly.

Then, a week before Christmas, they pulled their “annual fee” trick.

Every December Pipeline tries to charge me the annual fee that my contract specifically forbids. Every December, Merchant Express makes them reverse it. This year’s annual fee was disguised as a mandatory PCI compliance fee of $150. “PCI Compliance” is a government security requirement that doesn’t apply to little guys like me who use third-party processing, but it gave Pipeline another way to bleed their merchants at the busiest time of year. I ran to my Merchant Express rep, who said that they could move me to a cheaper payment processor (Fast Transact) to get me out of the stupid PCI fee.

Did I mention that this was a week before Christmas?

I was busy. Lo and behold, I blew it off for too long, and they finally debited my bank account $150. They will not discuss refunding it, even if I cancel their service before it takes effect. No appeal. End of story.

I am finally motivated now to scrap Pipeline. Their customer service (the two times I tried to use it) was the most arrogant and unhelpful I’ve ever encountered, and their monthly fee reports are indecipherable. I have not decided whether to go with Merchant Express’s payment processor Fast Transact, or switch to the highly recommended CDG Commerce. I think CDG might be a little cheaper overall (they have higher fees but lower discount rates). I might eventually recover more than the $150 that Pipeline Data stole from me. But I'd have to give up Authorize.net as my gateway. I like Authorize.net. And I wouldn’t put it past Merchant Express to pilfer my bank account for cancellation penalties, even though my 3-year commitment ended months ago. I wonder if there’s a way to revoke their withdrawal privilege.

I must force myself to decide on Monday. Each day that I put it off, a little more of my money goes into Pipeline Data Processing’s bank account. Bastards.

My dumbest screwup: I forgot to schedule my Amex payment with Citizens Bank. This is the first time Kraken Enterprises has ever been late with any payment of any kind. I am so embarrassed. I know that credit card companies delight in smiting tardy payers, and that Amex has the reputation for being the least forgiving. I hope they don’t punish me beyond the $38 late fee they already hit me with.

Miscellaneous little screwups: There’s the customer who placed a double order, did not answer my email inquiry, then announced right after I sent out his boxes that he is going to return the duplicate and make me issue a $80 refund...when I knew all along that I should’ve just canceled the second sale. There’s the customer who returned a defective levitating globe (surprise, surprise) to its manufacturer for warranty replacement, got blown off, and has asked me to intercede. If I can’t help her, she’s probably going to want a refund from me...and I can’t do that when she returned the merchandise to somebody else. There’s…um, well, that’s all I can think of.

**************

Visits were below 200 per day all week. If you subtract one unusually large sale from LY, the week came in very slightly ahead, but still not even half of plan. The first fiscal week of 2009 is not encouraging.

Reasons to Hate Shipping

This post was originally entitled “The Airspeed Velocity of an Unladen Swallow” but I decided it was both too cute and too obscure for a post about the arcana of accurately calculating shipping charges, a topic that I first addressed last December. I shall avoid repeating that earlier post, so I suggest that you read it for background if this subject interests you.

Last week I subtracted $225 from my open-to-buy (or more accurately, I added $225 to my OTB deficit; see the end of this post for more about that) to allow for the cost of shipping a $176 order. Imagine my surprise when the bill came in at $249.12! That’s right; four cartons from the Left Coast cost $73.12 via UPS Ground – over 40% of net! Fifteen percent of net is considered reasonable and customary for freight; lately, 20-25% has become common in our energy-inflated economy. Forty percent, though, is pure bullshit – especially since this was bargain-priced merchandise that should have delivered my benchmark 50% markup at an appealing sale price. Instead I had to price the item higher than some competitors just to achieve a dismal 39% margin. If I were to price-match the competition, my markup would drop to a money-losing 15%.

There had to be a mistake. Sure enough, two 13-pound cartons bore labels showing that they weighed 27 pounds each. When I notified the vendor that they were overpaying for shipping, I learned that UPS was charging a dimensional weight. Because those two boxes exceeded some arbitrary cutoff size, UPS charged double their actual weight. I certainly won’t be reordering this “bargain” again. I can only sell it profitably if I inflate the shipping cost to my customers – a common dishonest tactic that I have always rejected as sleazy.

I try to take in exactly as much money as I actually spend on shipping, with a tiny surplus to cover the cost of boxes and packing materials. Ideally, every order is charged a few cents more than its real shipping cost. Alas, that is virtually impossible to achieve in the real world, as I explained in the earlier post linked above. Last week I actually dropped my handling fee by a nickel, to 70 cents from its high of 85 cents, because my shipping fee collections were running a wee bit ahead of expenses. In aggregate, I do a good job of balancing income and expense. Getting there has taken a lot of time and attention, and a few items are still out of whack.

Google Checkout’s rate calculation bugs have been an ongoing hassle – check the “Reasons to Hate Google” tag to find those posts. You would think that a shipping lookup module would just take a total weight, consult some tables, and return accurate prices. Nope.

Reasons to Hate UPS: UPS charges a base rate that varies across geographical zones. Then they add a fuel surcharge that (presumably) fluctuates with actual fuel costs, but in reality only ever goes up. Then they add a residential delivery surcharge if the package is going to somebody’s home. Then they generate fictitious weights to cover the bizarre dimensional pricing that I mentioned earlier. There’s an insurance surcharge for packages worth more than $100. Even after all that is factored in, the price that I pay when I create the shipping label often differs by a few cents from what UPS ultimately charges my credit card, necessitating fiddly little corrections every time I get a credit card statement. Overall UPS rates are higher than the USPS, their service is slower, they don’t deliver on Saturdays or to PO boxes, and they often damage packages. Package tracking is the only thing I actually like about UPS.

Reasons to Hate the USPS: The post office revises their rate structure every year, requiring customers to re-develop our shipping modules. The parcel post bug about which I’ve written so often recurs so dependably that I suspect it’s a deliberate effort to reduce parcel post sales. And that’s just the beginning. USPS uses separate rate tables for “machinable” (standard) and “non-machinable” (oversized, undersized, and oddly-shaped) packages. In May, USPS introduced UPS-style dimensional premiums for priority mail over one cubic foot. The cheaper services like first class parcels and parcel post are not available online via Click-n-Ship, but priority mail receives a discounted rate when purchased online. And then there’s flat-rate pricing when you use the proper boxes. For all of that complexity, USPS does not guarantee their delivery times, or offer parcel tracking, or provide loss coverage for uninsured parcels. Presumably that’s why it’s so much cheaper than UPS.

Given the level of complexity by both carriers, it’s no wonder that so many merchants prefer fixed-rate shipping tables. Who knows? Maybe some customers really would rather pay a fixed shipping price per dollar amount – at least it’s predictable. I suspect (for no objective reason) that my customers would rather pay the real cost of shipping than a one-size-fits-all rate based on purchase price. Merchants who use flat-rate shipping tables are just dodging the issue. So I gamely struggle with the lookups, constantly fine-tuning item weights and adjusting my handling charge to approach the ideal. Until the next rate reorganization comes along and screws everything up again.

And now, as long as we’re hating companies…

Reasons to Hate Microsoft: I feel like my hatred neglects MS. That’s not a deliberate slight; they just don’t have much to do with e-commerce. But here’s something: After a Windows update a few weeks ago, MS Outlook started freezing on the first load, on both of my machines. It loads OK on the second launch, but makes me wait for a 30-second repair routine each time. I allowed Windows to report the crash to Microsoft each time in the unlikely event that somebody is collecting those. Eventually I got a link Microsoft’s solution: Upgrade from Outlook 2002, because it’s no longer supported. Thanks, Microsoft! You just moved me one step closer to migrating to web mail.

Speaking of my open-to-buy…I don’t think it’s ever going to reach zero. As much as I really want this business to put money into my pocket rather than siphon it out, I am on the verge of loaning the company enough money to wipe out my deficit, satisfy pent-up demand for reorders, and bring in one expensive new product line. It would take $3,000-4,000 to do all that. I even have that much money sitting in an ING Direct account named “Kraken Startup”. Five things keep staying my hand: (1) The aforementioned aversion to putting more money into the company; (2) a real lack of warehouse space in the cellar; (3) the certainty of earning a nice, safe 3% return by leaving it right where it is, versus potentially losing it entirely if I invest it in my business; (4) my belief that future cash infusions should only be used for technology and marketing; and (5) my suspicion that bailing out the OTB – again – merely ameliorates a long-term structural problem in either the way that I calculate my OTB, or the way that I spend it. Yeah, I could pour $4,000 into overstuffing my cellar right now…but will I be right back to low stock levels and an empty budget again when it’s time to lay in Christmas orders in a few months?

Coming Attractions:

• Running with the Big Dogs
• Let Us Now Praise Famous Products
• The Zombie Store
• Legal Extortion

The Arcane Art of Shipping

Last week was consumed with xmas, of course, and by my preliminary effort to tease some meaning out of the results. Since that's still in progress, and because something unexpected siphoned off my attention for a couple of days (I can’t write about that yet), today’s post is one that I’ve been chipping away at for a few weeks.

First, though, I’m pleased to mention that the last week of December was much stronger than expected. I have still not had a shutout since mid November.

I do 95% of my shipping through the post office. They do the best job of delivering packages in a timely manner and in good condition for a reasonable price. USPS is certainly more reliable than UPS or FedEx. But they do piss me off sometimes.

I buy my shipping labels at the USPS Click-n-Ship website so that I can just drop the paid-up packages at the post office and be on my way. Online purchases get free or reduced-cost delivery confirmation, and some services also earn a small discount off the walk-up postage rate. This is all well and good as long as you ship via priority mail or express mail.

Problem is, at least 75% of my customers choose the cheapest shipping method. That is usually first class mail (under 13 ounces) or parcel post – services that USPS doesn’t sell online. Why? Because they have sweetheart deals with Stamps.com, Endicia, and Pitney Bowes. If you want to access the full range of USPS services online, you have to pay one of those third parties for the privilege. That will set you back $16 per month for a convenience that the USPS could easily offer for free.

It offends my sense of fair play to bribe a third party for a service that ought to be free. I’m sure that the USPS gets a kickback from those third parties. So I usually upgrade my parcel-post orders to priority mail when that’s cost-effective, or I stand in line at the APC (automated postal center) when it isn’t. The APC offers most domestic services, but it soaks you 75 cents for delivery confirmation, and it can’t print customs paperwork for international sales.

The last resort is standing in line for a human clerk. There is nothing a postal clerk enjoys quite so much as telling you why you can’t do something, or that you have to fill out additional forms, or that your box is somehow below standards.

International shipping too often sends me to the counter. Packages under four pounds – most of mine – are cheapest via first class international, and guess what? You can’t buy first-class postage online. The price gap between first-class international and priority international is way too high to upgrade. And so I have to fill out the customs paperwork by hand, and wait in line for a surly clerk to scowl at my packages and look for reasons why I can’t ship them.

December’s frenzied pace made that $16 monthly fee at Endicia look so tempting that I finally overcame my inner cheapskate and signed up for their 30-day trial. From Dec. 4 thru Dec. 26, I shipped 78 first-class or parcel post boxes through Endicia. For each one, I paid 18 cents for delivery confirmation instead of 75 cents at the APC. That’s $44.46 that I saved, not to mention several hours of standing in line. Sixteen bucks for that looks like a bargain. Now I have until my trial ends on Jan. 4 to decide whether the time and money savings make sense during my slow months, too. Financially, probably not. For convenience and stealth, maybe so. I'm going to keep it through January and see how the numbers come out.

Stealth? Did I say "stealth"?

Endicia’s basic rate is only $6 per month. I'm paying an additional $10 to print labels that say “Postage & Fees Paid” instead of showing the actual amount. That’s called “stealth postage”.

I strive to keep my shipping charges neutral – to take in very slightly more than I pay out. Ideally, every single order would cost a few cents less than I collected. In practice, it’s very difficult to calculate shipping charges accurately. Consider the lighted cap.

One packaged cap weighs 10 oz. It’s simple enough to set the weight of one cap at 0.6 lb (9.6 oz) and charge those customers accurately. The problem is that packaging accounts for much of that initial 10 oz. The caps themselves actually weigh only 3-4 oz. If a customer orders two caps, the assessed weight of 1.2 lb takes them out of the first-class mail table and puts them on the 2-lb priority or parcel post rate. But the actual package weight is just 13-14 oz, which could go first class, or for the 1-lb priority rate. The more caps I put in a single box, the greater grows the disparity between the assessed weight and the actual weight, and the harder I soak my better customers.

My workaround is to add an invisible handling charge charge (currently 85 cents) to every order, and reduce the weight of each cap to 0.4 lb (6.4 oz), which is closer to reality. Now the single-cap orders remain pretty accurate, and multiple-cap buyers get a better deal. Careful analysis would let me optimize the handling charge and cap weight for my most common orders. This would be great if I only sold caps, but mixed merchandise makes it impossible to charge everybody accurately. So the best I can shoot for is overall balance. In December I collected $1408 in shipping fees and paid out $1353. I think you’ll agree that a $55 overcharge is reasonable and minor…unless you happen to be one of the unlucky customers who contributed to it (remember that some customers are undercharged, too, so there were actually more than $55 in overcharges).

Enter stealth postage. :)

While I’m complaining about carriers, here’s a new reason to hate UPS, too: A number of weeks ago a customer placed a telephone order just minutes before my 2 pm cutoff for same-day shipping. Literally minutes after the call, I had her box packed up and on its way. A couple of hours later, she tried to cancel the order. That's when I discovered that UPS has a package recall feature. You can intercept it prior to delivery and have it returned to sender. I told the customer that I was doing this, and that she’d have to pay return freight. She was displeased, but why should I take a loss because she changed her mind?

The return freight should be the same as the outgoing freight, which was $9.50. And it was -- plus a $10 intercept fee. Yes friends, it cost $19.50 to have that little box returned before it reached my customer. With the original shipping fee, it cost $29 to transport merchandise that she never even got.

Because that $10 surcharge was news to me, I ate it, and just charged her the $9.50 that she would’ve had to pay if she had returned the package herself. Everybody loses! Except UPS, that is.

Orange is hot

The Sunshop upgrade that began on August 25 is progressing nicely. The cosmetic changes are mostly done. After some functional fixes, I can import the catalog and start updating items. This will inevitably uncover more bugs. I still hope I can open this thing by Halloween.

Speaking of Halloween...What’s up with orange? I noticed it all over my new store templates: orange text, orange buttons, orange accents. It’s not a very appealing color, yet it’s pervasive on the web. Is it a fashion trend? Is there some functional reason to use orange? My wife tells me that it’s all the rage in women’s clothing this season, and I’ve even seen a disproportionate number of new orange cars. Orange is hip. Orange is now. Orange is happening.

Orange is ugly. It will look dated a year or two from now. I’m having all the orange removed from my design.

Reasons to hate UPS: The charge that appears on my statement often differs from the nominal charge at the time of purchase. Sometimes they credit me a few cents, sometimes they surcharge me a few cents. Altogether, it makes little to no difference in the monthly spend, yet this practice makes my charge statement difficult to balance.

Christmas Merchandise: I recently pushed my open-to-buy deeply into red ink with a Fascinations levitating globe order. This is one of a handful of vendors with whom I bothered to establish credit, so the bill doesn’t go on my credit card. Christmas sales will be pouring in – or had better be – when it comes due in 60 days. It almost shouldn’t count against my OTB at all.

Nearly 50% of my annual business will come in November and December. So I am continuing to order despite a dearth of current sales to recharge my budget. I might even carry a credit card balance for a month – heresy!

Speaking of my credit card...yesterday Advanta called to tell me that Mastercard had informed them that my card number was compromised. My corporate MC account is on hold and a new card is being sent. Luckily, I have a fallback Amex card.

You could just visit my New Arrivals page to see where the money’s going…but since one purpose of Curious Business is to create links for the benefit of search engine spiders, here they are:

PurseHooks were one of the two products that I found at the fall Boston Gift Show. I have since seen them everywhere. I think they’re going to be like lighted caps -- a cool novelty just six months ago, they’re now sold at Sharper Image and the QVC shopping channel. I can see this being an ongoing problem for Curio City: When products reach a certain level of success, they’re no longer appropriate for my store. If I’m right, the purse hooks are at the beginning of that arc. They’ll do well through xmas, and maybe into Valentines Day if I’m lucky, before they attract the Walmart crowd.

Record purses (the other product that I found at the Boston Gift Show) are a natural companion to purse hooks. These also tie into my Vinylux line, which sells steadily if unspectacularly. Vinylux has achieved fairly wide distribution over the past few years and may have lost its novelty. The record purses, OTOH, are brand new and exciting. If their creator can supply them consistently – and especially if she can accommodate special orders in a timely way – they could become the Next Big Thing. Alternately, supply vagaries could send them the way of my late lamented typewriter key jewelry. Customers like these recycled art products, but their very authenticity makes it very difficult to supply the most popular designs. Just as each typewriter keyboard had only one “M” key, there’s also a finite number of surviving copies of any given LP. Selling them online adds another familiar challenge: It’s going to be very difficult to reorder the best-selling titles, and I’m not sure that photos will be enough to drive impulse sales. If I have to make new product pages every time I restock, they might not be practical for me.

My last major investment went into levitating globes. These big-ticket items sell steadily when I can afford to keep them in stock, and the manufacturer has several new models for this Christmas. They don’t sell them to big retail chains -- hooray! On the down side, complaints about defective units leave me anxious about their quality. They’re bulkier than most of my products and getting them here from California is quite expensive. The closely related Floating Ideas has never sold a single unit. The number of variations on each design, plus chronic stock shortages, makes it difficult to present a coherent, reliable line of floating globes. Despite these concerns, I restocked four older styles and introduced three new ones.

The order just arrived yesterday. This afternoon I need to unpack it and photograph the new styles. I need to see a copy of the invoice to ensure that I got the special pricing on Zero G Sports. The Golf version has sold slowly at a discounted price. Fascinations is offering the rest of the line at a special discount, so I’m bringing those in, too.