With the first batch of 10 medium-sized dragon fairies now fully accounted for, I find myself in a situation trying to get my head around the joys of e-commerce. This is a steep learning curve for someone institutionalised by the civil service and whose only previous experience of selling stuff was sitting/standing by a check out in a supermarket during my student days.
There are a whole host of things that have been flying across my mind in terms of how to manage all of this – which is essentially a sideline to other stuff that I want to do. I don’t have any plans to go into the business of selling soft toys full time. So what are the issues?
I have no idea what overall demand is beyond the 10 or so people who have already reserved. What will the “conversion rate” of twitter/blog followers to purchasers be? I had previously worked on the assumption that a 1% conversion rate would be more than splendid, but given that I am already nearly half way there with reservations from the first batch, is 1% an underestimate?
Talking about money is not something I’m particularly comfortable with but ultimately I’ve spent a fair amount of money on designs and prototypes that I now need to recoup as what remains of my redundancy payout evaporates with time. There are a number of considerations here, ranging from how many ‘units’ I want/need to shift before I’ve recouped my original investment in the design and prototypes. At the same time I’m also mindful that a many people who follow simply cannot afford to spend that amount of money on what is essentially a cuddly toy. (Especially the big version).
Tax and benefits
In the next week or so I’m assuming that I will have to sign off JSA as money starts coming in – or will I? How does this work where I’m running a ‘micro-business’ where income is on an ad-hoc basis? Do I sign on for the weeks where I’m job hunting and am not making any sales and sign off for the weeks that I receive payments against sales?
Then there is the issue of tax – in a nutshell, how do I go about declaring what’s come in, what’s gone out, what is ‘profit’ and how much will I need to pay? Will I have to ‘register’ this sideline activity as a business in itself?
It’s one of the reasons I’m attempting to keep reasonably organised records of the orders I’m making and the sales that I am achieving. The complexities of this, paid employment and receipt of JSA is going to make calculating my final tax bill (or any rebate) interesting. Given that tax avoidance and tax evasion have been issues that I’ve been jumping up and down about for quite some time, I want to do this all above board. I know there are some who would say to do all of this cash in hand & off the record, but that’s not the way I roll.
Ordering and distribution – systems and processes
What is the best process for all of this? For this first batch I bought all of the items in bulk for me to distribute individually, whether by post or by hand through meeting up with those who’ve ordered. But it’s not the most efficient way because for a start there is a potential duplicated cost of postage – from the manufacturer to me and then from me to each individual. Would it not be better to set up an online portal/system that would allow people to purchase items electronically rather than having me sending each item through with an invoice asking for either a cheque or an electronic transfer where I have to give out bank details?
I’m also seriously considering setting up a completely separate bank account for this sideline – even though for now at least this is a micro-business. I want to keep transactions related to the buying of stock and receipts from the sale of items separate from my personal bank account. Does this constitute a normal current account or will I have to get a ‘business’ bank account? (Which tend to be more costly).
Having cut my teeth on data protection amongst other things, I’m a little nervous about holding people’s personal information (even if it is a Twitter account or a home address) on my systems. I shouldn’t be, but I am. Is there a suitable “cloud computing” facility that would allow me to store documents securely without having to worry about worst case scenarios such as loss of hardware or messing up of software/documents?
In a sense images of the dragon fairies seem to be having more than a splendid effect. There is a risk that I start ‘spamming’ people through twitter – something I will try to refrain from when it comes to promoting these little bundles of fun. Also, do I want to go beyond my core following and sell them to whoever, or restrict this entire activity to a micro-scale?
I’m lucky in that the manufacturer already manufactures the items to EU standards & complies with UK regulations on toys – because even though I’m selling them to adults, most reasonable people would say that these items are toys. Hence why using other materials to stiffen the wings is a non-starter. But are there any other things that I need to be aware of?
What happens if someone is not happy with the little bundle of fun that arrives through the door? Who has what rights and what is the best system for ensuring refunds are paid and stock is returned undamaged? What if the item returns damaged? Who’s liable?
This is where I need to get a number of things sorted on my part – in terms of setting up and launching a small number of other social and digital media accounts. As I said to my good friend Sarah Baskerville last week, ultimately what I’m aiming for in my entire social media presence is to have the various different accounts bouncing off and feeding off of each other so that their combined presence is greater than the sum of their parts. But I’m still nowhere near the level of competency that I’d like to be at on a number of different digital media and software packages. I got loads out of the Media Trust’s training on how to make a digital video on a shoe string. Less so with the Adobe Illustrator course, but the latter is very much a practice-makes-perfect challenge that requires a level of patience that I’m currently lacking.
On a number of things I’ve got pictures in my mind of where I would like to get to and what I would like to achieve. The big barriers I have at the moment are:
- Fear: I’m more than a little out of my depth in all of this. As in my blogpost on middle class, I’ve played things fairly safe in terms of career path. But the world is going through one hell of an upheaval at the moment and I have no idea where I’ll end up once things (as I hope they will do) settle down
- Procrastination: I need people to bounce ideas off and to help me get over some of the small but significant technical barriers. Sort of in the way Soph Warnes and Fi Douglas helped me out setting up this blog, or Steve, QofE, Natalia and friends with the setting up of Pufflescamp.
- Finance: I’m not loaded – simple as.
- Upskilling: Sort of linked to the above, there are a number of training courses that I would like to go on, but can no longer afford to. I also feel that I need to be in an environment where I am surrounded by dynamic enthusiastic motivated collaborative types (on a regular basis) whose energy I can feed off and contribute towards too.
- Location/place to be during the day: The lack of a desk has had a surprisingly debilitating impact on my productivity. Yes I need to be out of the house – Parliament TV is too much of a distraction. As above, the environment I feel I need to be in is one conducive to innovative working & forming sound working relationships with other people around me.