Describe the process of designing, prototyping, and manufacturing the product.
The hardest in getting a new product to market in our experience is finding and settling for a manufacturer. There are so many out there and so many shady or just bad quality manufacturers and sourcing partners.
We initially used an American sourcing company. We wanted to start small, with a small batch and most manufacturers have minimum order quantities that they require. In regards to clothing that means that the buyer needs to purchase a certain amount of fabric in order to make the order viable. Initially we did not want to / could not do that. So we found a sourcing company from China with US offices (they don’t exist anymore hence we cannot give a recommendation) that could help us with a smaller order. That meant using existing colors and fabrics of course.
We initially ordered 5 color sets and 500 of each for both women’s and men’s as a trial. The price was way higher than what we pay today, which is normal. The smaller the order the more you pay.
The first order took forever: I am not a designer and we did our first order based on rudimentary drawings off of products I found in stores and basically drew instructions on.
Our first product was underwear, so my husband and I bought several, wore and washed them over and over until we found the best quality.
We then drew and sew on them and sent the ‘finished’ prototype to the manufacturer who made the first real prototype. These went back and forth several times until we were happy. We then placed our first order for 5,000 products in all.
As we were just starting out we did not want to get a warehouse for fulfillment just yet. My sister who lives in the UK was our first fulfillment partner. She stored all the products in her garage and fulfilled all orders for us. We thought we would start with Europe and grow from there, but from day one we have sold much better in the US and Australia than anywhere in Europe. We now have a professional fulfillment partner in the US fulfilling all orders.
We quickly realized what worked and what didn’t based on the first batch. We realized that men only want black, gray and white underwear. Colors look great on the site but no one buys them. Women want pink and black and gray. When we knew the idea was working, we knew we needed to expand the product line. People clearly liked our idea and saw a need for our product, they got it and just like us they did not like money belts or fanny packs. So we expanded and designed tank tops and t-shirts with pockets. As these took off, we soon developed new designs. For every order of new stock (we place 2-3 large orders a year now) we have added a new design. Our last addition was a t-shirt dress with two secret pockets. Before that we added circle scarves and leggings, We are currently working on about 5 new designs. These days we are much more professional, both in regards to design and in regards to the tech pack (i.e. size charts, quality, sewing instructions etc.). We have learnt it on the job and now know quite a bit about both fabric and sourcing.
When starting out the most difficult thing was finding the manufacturer and especially one that would supply consistently high quality. We are on our fourth manufacturer now. The first in China started delivering lesser quality by the third order. We then, though recommendations from a friend at a Swedish children’s clothing company, found a manufacturer in India. They did an excellent job for 3 years but their staff turnaround is huge as all the competent project managers leave to get married. Last year they failed to meet all delivery times and also messed up some sizing so we have been forced to look elsewhere. When looking for a new manufacturer we sent them some samples and asked to copy them exactly and give us price quotes, we then wear and wash and dry the samples repeatedly to check quality. If they stack up, we proceed with a smaller test order. After all, this is a lot of money per order and we need to know the manufacturer gets it all right; from quality to sizing to colors to packaging to shipping. Just packaging products for shipping, is a whole side career: you have to get SKUs, packaging labels, quantities, sorting just right. Many fulfillment centers, and especially Amazon, get very upset if the packaging, documentation or labelling of incoming shipments is not exactly right, which translates to more costs.
Last year our Christmas order arrived in February, making us miss out on the Christmas sales. That can not happen again. So we now have two manufacturers, one in India and one in Turkey.
Many people, especially in the US, want to manufacture in the US. I get that it is a pride, a solidarity thing and I completely understand that. That said, we are not Americans and we have no greater loyalty to any one country – we sell all over the world and I believe all counties can do an equally good job and also deserve the jobs equally. The quotes we did receive from American companies were so high they would simply not be feasible for us at our size anyways. The US quotes are more than double what India can offer including shipping and customs.
Our startup costs were low. We have no office. No fixed staff. Initially we did everything ourselves, absolutely everything from site design, to photography, to product design to accounting to legal. The only fixed start up cost was setting up the LLC. The other costs were getting our first prototype and buying lots of samples to test out. Setting up the store was 30 USD. Of course the first order was a huge cost. We paid about 30,000 USD for it. It was a gamble and scary but in the end it worked out!
These days we have two staff. One works on fulfillment and manufacturing and one works with administration/customer service. Both travel full time and the work is completely online. We also hire freelancers through various freelance sites for site design, photo editing, bookkeeping, etc. We use a fulfillment center in the US called Efulfillment Service INC out of Michigan. It is our third fulfillment partner. The others were ok initially, but they both got sold to larger entities and completely lost their customer service and response times and they also kept increasing shipping and packing costs.
Describe the process of launching the online store/business.
Creating a website is easy and inexpensive these days – it is the easiest and most fun part of launching a store I think. The site we have now is our third design. It is completely focused on our target audience, which after a few years of being in business, we now know are not city people, overly trendy people, but regular folks, who worry a tad when traveling, middle to high income, friendly, open minded. The design reflects this and we have purposefully set out not to be especially trendy in the design, by this I mean adopting the omnipresent minimal hipster design. We aim to appeal to a large set of audience in design of site and products, and also in regards to product design and sizing, for example we have sizes ranging from XXS to XXXL.
We have worked in the startup business before but always in larger companies as part of a venture capital group. The Clever Travel Companion is a mom and pop shop and completely lean, leaner than anything. It was entirely funded by our own money: when we decided to leave Sweden and travel, we sold our house. That money funded the company and we basically used it all to live off of whilst launching: had it not worked we would have been broke. Again. It was a few hard years getting things to where they are today, where we can live comfortably and not be completely financially exposed all the time.
Since launch, what has worked to attract and retain customers?
When we started in 2011 social media was not as big of a thing as it is today when it is completely ubiquitous. Initially we only had the site, but we soon started Pinterest, Facebook and Instagram accounts. We have never really used Twitter. Pinterest never did much for us. Facebook is what works best, but that too is slow compared to selling via the site and Amazon. Facebook ads can work but they take a lot of work tweaking to get it right and maintain good ROI. Google ads are the same, a lot of work and money in order to see results.
Since day one we have worked on getting press coverage. It is a lot more difficult today than it was just a few years ago. Journalists and bloggers are inundated with press releases and request for coverage, making it very hard to be seen and stand out. It takes a lot of work: First finding appropriate writers and blogs and then finding contact information, writing appropriate and personalized emails and then following up. That said, it is totally worth it. Our growth is mainly based off of press coverage. Our customers are not as active on social media as let’s say the younger generation is. We track our sales and see where they come from – it is about 75% directly derived from reviews. Of course everyone wants an ad or coverage that goes viral, or for Oprah to put you on some list, and so would we, but it is difficult and it is not something that you can count on. We just keep plugging away at the press as it consistently delivers, press coverage is what works and every press mention is directly transferable to an increase in sales.
We also work on affiliates – we have close cooperation with some bloggers and they plug our products in exchange for a percentage of sales. We do not pay for coverage. Many, many bloggers do want money in exchange for coverage, but we want honest, real reviews of our gear. We want the people plugging our gear to know what it is and actually like it. We supply free samples of course.
We have a pretty good SEO set up at this point: Our favorable press coverage and our blog, which we really try to work on. We write about anything travel related and we try to be relatively SEO focused. In sum, we focus on organic growth rather than paid marketing and so far we have been pleased with the results. That said, we are always open to trying new strategies, apps and what not. Getting press is never ending and it is crucial to always be seen in new places, in order to increase sales.
How is everything going nowadays, and what are your plans for the future?
We have a steady stream of customers and we are slowly but surely growing every day. We are always thinking of new products. The only thing slowing us down is the design and the prototype process which is slow. We have to find manufacturers and then make our designs come to life. It takes many reiterations to getting things right. We will be launching 5 new product in the next year or so. We are also transitioning staff. Our current admin/service rep is moving on to another project with us and we are welcoming a new addition.
We would like to see sales increase and are constantly working on that. Eventually we would like to discuss a sale or merger. We are entrepreneurs and love coming up with and starting new concepts. As the Clever Travel Companion grows it takes more of our time, leaving less time for developing new ideas and projects.
Through starting the business, have you learned anything particularly helpful or advantageous?
There is nothing you cannot do yourself if you need to and there is no one right way to do anything.
There is no golden rule for starting a business. Read all the entrepreneurial books you want, but in the end it is all about getting things done, getting up and doing it. Anyone can do it, but I think many people do not realize how much work it entails to get a business off the ground. We just see the Shark Tank and Silicon Valley success stories, and they make it look so easy, and fast. But that is not reality – most businesses are small, family run, time intense projects. It takes work! We are grateful and happy to be where we are today with The Clever Travel Companion. That said, we have worked very hard and many, many hours to get here and to have the lifestyle we now get to enjoy.
The worst aspect in my opinion is dealing with unreasonable customers. Most people are friendly, nice and understanding but every so often we get difficult customers and there is really no way of dealing properly with them. No matter what you do they will give you bad reviews and mess things up. For example one customer was very upset that we shipped her order with UK mail rather than USPS to Australia (even though UK mail was cheaper and faster). She messaged several times a day and was very angry and demanded discounts and all kinds of things. When the package arrived (one day faster than estimates) she was furious that the package was left on the porch. Because of all this she gave us scorchingly bad reviews everywhere she could. Now of course we tried to explain that we cannot control Australian mail services but she blamed us for everything. This is just one example but all companies get customers like this. They take a lot of time. A lot. And they always leave bad reviews no matter what one does.
We have a policy to always reply same day to all messages. Always. We are always polite and helpful and if a customer is unhappy we do everything we can to fix it. If a package gets lost we reship, if a product doesn’t fit we exchange/refund it etc.. But for some people it just isn’t enough, they want to yell and scream and mistreat someone. We still haven’t figured out how to manage it. It is time consuming and unpleasant.
On the other hand, many customers expect to be treated badly by online retailers and are surprised that we actually care and just by listening and trying to help in any way, many customers end up pleased and friendly. We get many return customers simply through providing great customer service. This often takes the edge out of complaints and anger that the customer has saved up. We try to make every single customer happy.
Also, we get the scammers. People claiming things never arrived or that things arrived broken. Yes, things get lost, but not often. All our products are inspected before shipping so the chance that they arrive default is slim. We still get people demanding refunds and claiming things are broken. And despite tracking info saying items were signed for and delivered people demand refunds saying their package never arrived.
We just chalk it up to losses and expect it, but unfortunately this happens more than we would like to think.
Another negative is dealing with large corporations, such as Amazon. It can be very time consuming and frustrating.
What platform/tools do you use for your business?
There are so many great tools out there but we try to keep the ones we use to a minimum. Many tools can make you and your business a lot more efficient but too many tools can also create issues by themselves. There are always compatibility issues when different tools do not update on the same schedule, some needs integrating with other tools etc. Shopify is our “home” and we try to keep integrations to a minimum. That said, we have great use of the tools that we do use and change them from time to time when something that solves a certain issue better comes along.
We mostly sell through our own site and through Amazon and are now starting to really get into wholesale as well. We have also tried selling through eBay and have “stores” on Pinterest and Facebook but that is not really working well for us at this point.
You can’t really talk about selling online and not mention Amazon – Amazon probably has an impact on every single e-tailer out there, either as a sales channel or as a competitor. Amazon is amazing at driving sales but selling through Amazon adds to the administrative burden and, above all, raises the frustration level. We already sell all over the world through our own site but also through Amazon in various countries. We do sell quite well through Amazon, but working with Amazon is a mess: Their system is cumbersome and honestly, completely messed up. Getting changes on the product listings is impossible. We tried Amazon Vendor Central, where Amazon purchases stock directly from you. That did not work well for us and slowed sales markedly. Unfortunately, after we went back to Fulfillment by Amazon and regular Amazon sale, i.e. where we sell and fulfill ourselves, Amazon has completely messed up our listing and we are having to spend a lot of time getting our own listings back in order to clean them up.
Issues like this is something you will always have to deal with, every time a third party gets involved, so much work and time is taken from real stuff, like developing the business. Honestly, we would love not to sell on Amazon, but they have too many customers for that. The Amazon customer service for sellers is non existent and they do not help in any way which is sad; I truly believe that Amazon could increase their own revenues to even more epic levels if they worked more actively with streamlining and simplifying the system for sellers (as well as themselves).
Here are the bulk of the other tools we use:
What have been the most influential books, podcasts, or other resources?
We have read all the typical books; Tim Ferriss, Seth Godin, startup and entrepreneur magazines and blogs. They are inspirational of course, they get you pumped up and excited and makes anything seem possible and attainable. But they are not real life, and there really are very few books with concrete advice for small, lean, one or two person, organically growing, self funded companies like ours – which is probably the most common type of company. What is lacking in my opinion is information on how to do it: We have spent so much time researching and solving problems. Problems that I know many others have already solved. I would like to see a book with real, hands on advice, step by step how to’s: how to get press, how to talk to customers, how to get prototypes made, how to successfully buy ads on Facebook and Google – with real examples, not fantasy ones. Most companies do not blow up and grow to millions in sales in a few years, most companies grow steadily over years. Most books only say “do lots of PR”, do Google ads and “it will happen”. Yeah, right, I know that, but how exactly? No one says how to reach the journalists in this day and age, no one explains how ads really work and what pays off. So anyone writing a book, use more examples, interview more real entrepreneurs on how it is really done in small, one or two man run operations where the founders do it all, where there is no marketing team or PR team, just you doing all the grunt work yourself.
We would love to read more real life stories with concrete information on how to take the business to the next step. That said we purposefully do not want to grow in regards to staff and size, we want to keep it lean and easily manageable. More staff does not always translate to more sales, but more staff does translate to more time, more problems and more costs. So we want to grow the Clever Travel Companion as much as we possibly can within in the confines of keeping it small.
Advice for other entrepreneurs who want to get started or are just starting out?
You do not need a lot of money to do it. You need to work hard, though.
Initially we worked every day and every evening. It was very hard work. Some people just do not get how hard it is to make a product visible – there is so much stuff out there. Yes, some companies are lucky and hit the jackpot and get excellent coverage from a major source early on, but it is seldom a cinderella story and certainly not something you can count on happening – you just have to do the work, the press reach outs and it takes effort and time. If you have a good product, don’t give up, keep at it!
The main mistake we see others doing is spending too much money: They hire consultants and specialists for everything. That way the company will take forever to be profitable. Keep it lean, learn to do things yourself and, above all, get to know your business with all the processes involved, your products and certainly your customers – without knowing that there is not way to hire help should you want to, you need to know the basics to be able to be in control.
Another mistake is not believing that you can do it and thinking it is rocket science. It certainly is not.
The concept is easy, the plugging away is not. That said, we are working for ourselves and building something for our family. If we had regular jobs we would be spending just as much time, but we would be making money for someone else. So why not go for it and work for yourself? It’s your life, take control of is so that you can live your own life rather than someone else’s.
Where can we go to learn more?
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