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Monday, June 27, 2016

The Conversion Has Begun In Earnest While Sales For June Begin to Taper Off and James Bond Films

Steph and I are huge James Bond fans. In fact the only movies that we own are all of the Bond films produced since the first one, Dr. No from 1962. It has turned out to be a wise investment, since for $10 we own movies that we have seen at least a dozen times together. Every three months or so, we will watch them in succession. The amazing thing is that even though I know that the general plot is and what happens, I can never remember all of the scenes exactly, so each time I watch them, I pick up on something different. That is especially true of the double-entendres that Bond comes out with. By now, I thought  I had caught them all, but just this past week, we started watching them again and sure enough, both Steph and I noticed others that we didn't get before.

One of the popular debates among moviegoers is who was the best bond. Of course, most seem to favor Sean Connery. I feel that it is a bit unfair to the other actors who played his roles, as I have usually managed to find something to appreciate about all of them. Our favourite actually is Timothy Dalton, who played Bond for only two films in the late 1980's. For most of my youth my favourite by far was Roger Moore. I like his quips and puns, through many other people I talk to think he is cheesy and a bit of a buffoon. Moore clearly didn't take the character too seriously and you can tell that he had a lot of fun playing the role. I've heard in contrast that Sean Connery, as good as he was as Bond, actually came to hate the role and was only too glad to leave the franchise in 1968, and then again in 1971.

Ranking the movies themselves also elicits much debate among moviegoers. I find that the older films, despite the special effects and dated references have stood the test of time as movies and are easily watchable even now, over 50 years later. My favourite 5 are:

1. From Russia With Love - The helicopter chase and boat chase scenes are still amazing to me.
2. You Only Live Twice - The chase with the gyrocopter "Little Nellie" is entertaining.
3. Octopussy - The opening scene where Bond flies the miniature jet plane is very good.
4. The Living Daylights - the scene where Bond and Necros fight while dangling from the cargo plane is also very good.
5. Casino Royale - the scene where bond has to restart his heart after being poisoned and where Le Chiffre tortures bond are both entertaining.

There are scenes from other movies that would make my list of favourite scenes, but these five are the best when I consider the overall movies, in my humble opinion.

Turning to business matters, we have finally been able to start the conversion of US dollar e-bay lots in earnest. To date, we have converted all but about 3,100 of the lots. I anticipate that the whole effort can be completed in 5 full 12 hour days, which although a lot of work, will result in all of our material being listed for sale on Delcampe, which is a good thing, and in addition, it forced us to learn how to bulk edit lots in e-bay itself, which is not as difficult as I had originally thought.

Sales for the month are beginning to slow down now. I am anticipating that we will end the month with about $4,000 in sales - all of which will have come from the less expensive, high margin material. This is very exciting, as this type of material is almost exclusively what we are listing now.

Tuesday, June 21, 2016

Sales Pass $3,000 With 9 Days To Go and Reconnecting With An Old Friend

Today we passed the $3,000 mark in sales, and in terms of sales volume, this is our best month yet. This sales total is made up entirely of smaller amounts, with no one stamp being more than $50. We have been pleasantly surprised to have received several $250-$300 orders for modern Canadian material that historically has not been in strong demand. It would seem that our attention to detail and fast service is developing a following among our clientele. Today I followed up with another dealer that I had sent a want list to some 4-5 weeks ago. I was told that he hadn't gotten to it yet because he was too busy breaking collections he had bought down for stock. He isn't alone either: I have sent want lists to 2-3 other dealers over the past few months for items that my customers need. We aren't talking pennies here. Some of these lists were for hundreds of dollars in potential sales. Yet, it would appear that these dealers are never going to get around to filling them. Why? Because they are too busy. With what? Organizing their stock.

I'm trying not to be too judgmental here because I understand how easy it is to do this. When you love stamps as much as we do, it is natural to gravitate to that aspect of the business which involves working with stamps. But what I am discovering is that there is a very large market of badly serviced philatelists who are hungry to deal with dealers who will pay prompt attention to their needs. Steph and I have developed a rule that any sales order that comes in MUST be processed at the very latest by the end of the following day. By processed, I mean mailed out and the customer appropriately communicated with. Any enquiry or want list gets dealt with in the same time frame - nothing gets dropped. After all, these are sales and opportunities for sales. How can you be too busy to attend to those? Our stock will get organized all in good time. But we can't sell our stock if we don't have loyal customers and as we are seeing, it is much easier to retain them when you provide prompt and efficient, personalized service.

Just when I thought I couldn't receive any more amazing surprises in my life, I was on Facebook a few weeks ago when I saw a friend request from a "Simon" whose last name was the same as my best friend from grades 7-10 when I lived in Australia. Instantly, I knew it was him. He messaged me the day after I accepted it and we have had three Skype conversations each lasting 1-2.5 hours each in the three weeks since. It is as if time has stood still with us and we have simply picked up from where we left off as children. It is remarkable after almost 30 years of no contact to discover that you can still have a lot in common with someone you were best friends with in grade school. It is because of Simon that I developed my love of British comedy and it was he who started me down the long road of self-acceptance. At a time in my life when very few people understood what Asperger Syndrome is or knew how to identify it, Simon was the one friend who never made me feel that I was odd. We have had conversations about the same wonderful range of topics that we used to discuss then, only now we both have the breadth and depth of life experience to make these conversations really interesting. He is very concerned about the upcoming referendum in the UK (where he now lives) regarding the decision as to whether or not to remain in the European union. Tonight he explained what is at stake and I must say I learned a lot of things about the way the European Union works that I was not at all aware of. I am excited to see how the rekindling of this relationship unfolds. I am just happy to enjoy it for what it is.

It just goes to show that you never know what lies around the corner in this wonderful life we live.

Wednesday, June 15, 2016

Sales Pass $2,400 Mid Way Through June, And Other Developments

This is definitely a break-away month! Since my last post, the momentum has continued unabated, with new customers every single day, some of whom are spending significantly more than the average new customer has done. Now that I have another month of sales data, I thought it would be a good idea to look at  comparison of the results that I presented mid-way through last month, and for the first two weeks of this month.

The results that I tracked and presented last month, as of the 17th of May were:

Total number of stamps sold: 111
Total number of repeat customers: 19
Total number of stamps sold to new customers: 50
Total number of stamps sold to repeat customers: 61
Total sales dollars to repeat customers: $1,220
Total sales to new customers: $1,120
Average sales to repeat customers: $20
Average sales to new customers: $22.40

So far this month, as of June 15:

Total number of stamps sold: 247
Total number of repeat customers: 15
Total number of stamps sold to new customers: 61
Total number of stamps sold to repeat customers: 186
Total sales dollars to repeat customers: $1,671.69
Total sales to new customers: $733.94
Average sales to repeat customers: $8.98
Average sales to new customers: $12.03

The total sales level mid-month is about the same as what it was on the 17th of May, so it is a bit better overall this month. What is telling though is the volume: the total number of items sold so far this month is more than double last month. The average sales amount has fallen because many of the items we have listed over the last month are the less expensive items in the under $20 price range. However, these items are selling very well and the profit margins on them are excellent. What is ver encouraging is that we are now getting want lists sent to us to work on and fill, which we really weren't getting before. This is significant because it means that our regular customer base is beginning to regard us as their primary, trusted stamp dealer.

Looking at the blog, our traffic is way up also: we had 169 visits to the Canadian Philately blog today, which is one of our highest totals to date. The blog is now seeing daily traffic that numbers over 75 visitors a day, with more than 100 being common now compared to 30-50 just a couple of months ago. Most of the new posts that are going up are getting well over 100 visits as well. Our Adsense revenue is way up too. Just a few months ago we were lucky if we earned $1 in revenue per month, and now I am seeing around $7-$8 per month. It's not a significant amount of money, but it is money we are earning for content that we never expected any revenue from, and that revenue is growing. I am not sure if the cause of that growth is the increase in traffic, or if Google itself is getting more effective at choosing to display ads that my readers are likely to click on. Only time will tell.

Listings are proceeding noticebly more quickly than they were just this past month. I am now listing the Scroll issue of 1928-1929 and in one day I have listed over 50 items, which is excellent. I have close to 800 stamps to list from this set and I hope to complete that this week, or early next week. Fabio has nearly completed his identification and organization of the foreign and British Commonwealth material I had asked him to organize. So now the next major push will be to complete the successful conversion of all the U.S. dollar E-bay listings, which has to be completed by August 3 or the listings will not renew. Fortunately it appears that I now have a complete list of the all the listings with the original item numbers, so re-listing them and recording the new numbers should be fairly easy to do now. After that, it will be time to file the tax return for the company, which is due on July 31, and pay the tax that is owing on this year's sales.

Things are definitely looking better than at this time last month and it is nice to feel some momentum beginning to build that will take the business to the next level.

Friday, June 10, 2016

Sales For The First Week of June Approach $1,700!!

I don't want to jinx the rest of this month, but no sooner had a responded to comments about our sales targets, that sales have experienced a sharp uptick. The momentum has been VERY noticeable and most of the sales have come from relatively new customers that have very quickly become repeat customers. One of these is a fellow CA that first bought from me about two weeks ago. I know that the fact that I am from the same profession as him had a lot to do with his comfort level in coming back to me and purchasing again. Much of the sales have been in the very popular 1954-62 Wilding Issue plate blocks, where we now have 2 or 3 regular customers who are specializing in this issue. Where I haven't had the material in stock, I've been able to go and buy what is missing and turn it over right away. The margins on this are not as good, but they are still very good. This is one aspect of the business that I can see becoming a great source of sales and profit: keeping an eye out for customer wants. As I record the details of what our customers are collecting, we can keep an eye out for the material as it becomes available. This means sales that are more or less guaranteed, and happy customers.

Normally now, at the 10th of the month, we would be lucky to break $1,000. So far today, we are pushing $1,700 - and none of this is coming from extraordinarily large sales of individually expensive stamps. There was one return customer who in a week spent over $700 on about 50 items. He made offers on everything and while I didn't accept every offer, I did accept most of them, or countered at slightly higher prices. This customer illustrates why the business model works so well: he will feel that he got some fantastic deals, and we make profit on every item we sell. Generally, as long as we make a good margin on each item, we are happy to sell it. Occasionally, we will take a lower than normal margin on one or two items to keep the customer happy and coming back. This customer is the best kind to have in the sense that he collects all across Canada from early to modern, collects both mint, and used, as well as plate blocks and finally while he likes better quality, he will take lower quality if the price is right.

So heading into next week, we are very optimistic about the direction the business is going in. Also, it appears that E-bay have made some huge improvements to their listing migration tool, so many of our concerns about our US listings are dissipating, which is a huge weight off. Finally, material is getting listed quickly, with the store coming close to 4,800 items being offered for sale now.

Tuesday, June 7, 2016

Why Become An Entrepreneur?

This morning an anonymous commenter, I suspect the same one that has been posting comments to my blog, had this comment to make about my last post:

Not sure what 'your goal' really is - it has to be more than $5,000-6,000 in monthly sales, right? Especially with more than $100K of material listed for sale.

And the stressed out / slave to the business comment sounds just like the things you hated about being a lowly employee - except that as an employee, you were making more than $150K which buys a lot of KD..... Plus whatever Steph was making in her job.

Now, I don't know about you, but I get a distinctly trollish vibe from the above comments. In fact, what this person said bothered me for quite some time today. I finally realized that it was because this person has missed the entire point of this blog. That realization, in turn has prompted me to address the larger question of "Why bother becoming an entrepreneur?" Indeed, it is a very fair question, once you realize all that it actually entails:

  • Longer hours.
  • Stress.
  • No guaranteed income.
  • A lot of sacrifices in the early years when the business is being established. 
So why do it? Well I can only speak for myself and I can only go back to what I came to dislike greatly about my old life. It was not working for someone else, per se that bothered me. I actually enjoyed working at my profession when I was able to approach it as a calling - when I could sincerely address the needs of my clients and service them well. But what I found was that no matter where I worked, more than 50% of my time was spent on activities that I consider to be of questionable value:
  • Organizational politics.
  • Human resources activities.
  • Meetings that accomplished very little.
  • Administrative stuff that added very little value to my clients.
In addition, organizational bloat basically meant that my billing rates had to be such that I often could not do the simplest things for my clients at a reasonable cost. I ABSOLUTELY HATED THIS. I don't mean to single out my old workplaces as being especially bloated, no. I would venture to suggest that nearly ALL organizations are larger than they need to be, or indeed than they should be. Why? Because not everyone in the organization has the same intentions, the same motivations, the same stake in what happens and how things turn out. On the one hand you have the founders/owners for whom the organization is their baby. Everything they have is invested in its success. They are completely motivated to see the organization do as well and be as profitable as possible. Then you have the dedicated employees who actually are committed to the goals of the organization. For these people, their job is more than just a job - it is a career - something that they take pride in. Then, on the other hand, there is everyone else. By and large, these people are there for a job - something to do for which they get paid. Their investment in the success of the organization is either minimal at best, or at worst is non-existent. I can't tell you the number of times that an employee that I have managed has left my organization with loose ends and unfinished business and for whom the whole thing has become a distant memory within 2 weeks after they have given notice. It has often taken many months of staff hours to tie up the loose ends and clean up the messes left by their departure. 

Because of this, we have the entire discipline called HR. If everyone in an organization was on the same page, and equally committed to the vision of the organization, and 100% responsible for their actions, then I doubt there would be a need for HR. But the reality that I see is that most organization are collections of people with vastly different objectives and rates of growth. Because of this, the ones who I believe are the least happy most are those who are actually the most committed to doing a good job, while those who can do an OK job and manage office politics and the optics of their work have the best time. I could be wrong about all this. Maybe I just haven't worked in the right companies. But there came a definite point in my life, where I just got tired, tired of:
  • Putting out other people's fires.
  • Executing decisions I didn't agree with.
  • Having to manage the performance of other people.
After a while I began to feel that my life was wasted. I wanted to do something that is meaningful to me. I wanted to get back to basics of serving a client base at something that I am passionate about and so good at, that I can eventually be the best at it within a niche of my choosing. After a while, it really didn't matter to me whether I have money and luxuries or not. And maybe that is the fundamental difference between me and the commenter above. Every time this person comments on my blog, their comments are always about the money. Always, without exception. They are never about the qualitative reasons why a person might not want to spend the rest of their lives in quiet desperation, just so they can win at the rat race.  Does this mean that I don't miss the luxuries? Of course not. Sometimes I get downright depressed when I walk in the Beaches area of Toronto and realize that I might never be able to afford to own a home ever again. But the depression doesn't last long, and it dissipates when I remind myself of the freedom that I now have to practice my favourite craft and hone my skills and knowledge. There is nothing like the feeling of seeing our list of happy and satisfied clients growing every day. I don't get pats on the back from a boss anymore, but I also get to be the one who decides how good a job I'm doing - no one else. 

I don't want to suggest that there is anything wrong with being an employee. There isn't, and there are definite instances when it is the only responsible thing to do. If you have many family members depending on you and no financial reserves, then often having the safety and security of a steady paycheck is the most responsible way to look after the people you care about. But if you don't have those responsibilities, or your responsibilities in that regard are limited, or you have financial reserves and you want to pursue a life path of your own choosing, then I believe that being an entrepreneur is the only way to achieve this.  The other way to do this is if you are able to save most of your salary for many years (i.e. 15-20 years) and invest it in such a way that at the end of that time you can retire. If there is anything that the last year has taught me it is that most people with professional or white collar jobs make a veritable fortune and nearly everyone could retire after 15-20 years working if they were willing to live frugally during that time and give up most of the things that people so often feel entitled to: the nice house; the nice car; the nice clothes, meals out every week, annual of twice annual vacations, etc.  As far as I know, I've never used the expression "lowly employee" in any of my posts. So I think the person who made this comment is insecure about their own life choice, and is projecting that insecurity on to me and putting words in my mouth. 

The problem of course, for many people is that they aren't willing to make those sacrifices, and it is very easy to fall into a lifestyle where other people make all of your life decisions for you. Of course, most people in this situation would not acknowledge that this is the case and would point to all the decisions that they make freely. But the telltale sign that they are not in control is when they do things for long periods of time that they claim to hate, like having to work late all the time, or on weekends, or having to travel for work all the time. One of the things that you give up as an employee of an organization is control - control over your work environment, control over your finances, control over who you work with, control over when and where you work and finally, control over how you work. In exchange you get temporary certainty. I say temporary, because even though most jobs feel like they are permanent once you pass the end of the probationary period, there really is no such thing as a permanent job. If you are the type of employee who spends all their money as it comes in, well then you will always be fearful of the time when you lose your job, because that often equates to loss on many other levels as well. 

If you succeed in building your own business - even one that is small and only modestly profitable, you can never be fired or laid off. Most importantly YOU are in complete control of everything that you do. This amount of control can be scary because ultimately you cannot blame anyone or anything for your lot in life, since everything by definition is now of your own choosing. That, I believe is very scary to a lot of people. 

The person who wrote the above comment seems to believe that reaching $5,000-$6,000 in monthly sales should just be a breeze and should be something Steph and I should have achieved by now. I am really not sure where their perception is coming from - especially when most online sources say that it takes between 3 and 5 years for most businesses to reach a level of profitability where they can sustain themselves.  I can only surmise that it comes from working for an organization where the infrastructure was put in place long before that person started working for the organization; where the marketing efforts were expended long beforehand and where the goodwill was created long beforehand, so that all this person had to do was show up to begin producing results. However, when you are starting a business from scratch it doesn't work that way. Nobody knows you. Nobody trusts you. You have to earn that trust and exposure with hard work, by delivering value all while putting yourself out there and being patient. It takes  A LONG TIME to see results.  But the results will come - as long as you have a product, service or skill that at least some people want or need. I am often asked the question: "Yes, Chris but is there really a large enough market for stamps?". My answer to this is that the world is a very large place. 7 billion is a number that is really easy to say, but really quite difficult to truly fathom. Even if only a tiny percentage of people are interested in, what you have to offer, it is still a lot of people and a large enough potential market to sustain most people. The challenge is reaching that market. But nowadays we are fortunate to have inexpensive and effective ways to do this with the internet and social media. However, human nature has not changed, even though technology has. Reaching a market requires effort. It is not simply a case of putting out an ad and watching the sales roll in. 

So the question you have to ask yourself is really: Do I know what I want from my life, and is it more important for me to have complete control in shaping my own destiny, such that I am willing to sacrifice financial security and comfort for long periods of time? If the answer is yes, then being part of an organization may not be the best long-term fit for you. If the answer is no, then you are probably better off in an organization. That, in my mind is all there is to it.

Monday, June 6, 2016

More Than Just An Update - Getting Our Lives Back And A Lovely Surprise From Across The Pond

One of the reasons why I wanted to write this blog is that while the content of the posts themselves will illustrate what starting a business and becoming an entrepreneur entails, just as important is the pattern of posts themselves and what they don't say.

When I started writing this blog, most of my posts had a lot of content related to enjoying your new found freedom as an entrepreneur and recipes from all the new meals I was making in a relaxed manner. All of this was happening because I was at the beginning of the journey, when our bank accounts were still flush with our savings and so on. However, gradually as our expenses started to mount and the money began to disappear for living expenses, I began to feel stressed. My natural instinctive response to this stress was, you guessed it, to work harder and cut out all the little things that I wrote about before. Pretty soon, the experimental cooking dropped off, KD (Kraft Dinner) consumption went up and I stopped taking breaks in a frantic attempt to get as much material listed as possible so that we could get sales to a level that could eventually sustain us.

Our sales have always been pretty good, even since July last year and especially when we consider:

  • How specialized we are.
  • How little of our total inventory is listed now.
But for the last several months, no matter how good sales were, I would always assume that they were a one-off, and that they would not be repeated. 

However, in this past week, we have had over $1,300 in sales, $650 of which is for the first five days of this month, which is fantastic. We are basically making sales every day now, more than half of which are coming from new customers and the other half for repeat customers. I am slowly realizing that as long as we continue what we are doing that we will reach our goal. So I am trying to take more breaks now and to avoid checking my phone too much on weekends or after work. It's very hard to let go, but this last weekend Steph and I had a whole day together walking in the Beaches area of our neighbourhood and it was really nice. The weather was fantastic and it felt really good to re-connect and appreciate each other after basically just existing for the business. 

My point I guess is that it is really easy to lose perspective when you are trying to build a business because you have very few feedback mechanisms to let you know how you are doing. You want to succeed so badly that I think is is natural to assume that every win is a one-off and that failure is still a very real possibility. 

I received a really amazing surprise last week. An old friend from when I was living in Australia sent me a friend request on Facebook. As soon as I saw his name, I knew it was him. I eagerly accepted and he suggested that we Skype. Simon was my best friend while I lived in Australia between the ages of 11 and 14. We fell out of touch largely because there was no easy way to stay in touch back in 1985: there was no e-mail, long-distance cost hundreds of dollars and we lived continents apart after I moved to Hong Kong. I had tried to find him several times over the past 30 years without success. So I was naturally quite excited at the prospect of re-connecting with him after all these years. We scheduled a Skype call after work last week and it was amazing! We talked for over an hour and I'm sure if I didn't have to go out that night, we could have talked for several more hours. I am looking forward to more conversations with him. It is amazing the pleasant surprises that life can occasionally throw our way. 

So with June off to a good start, I am going to start my next batch of lot scans. 

Wednesday, June 1, 2016

May Finishes With $3,600 in Sales!

Not one day after I posted about the results for May, something happened that I simply had to share. Remember that 20c Olive Green War Tax stamp that I wrote about in a previous post? This one?

Well, a returning customer of mine who is very particular about condition, but who has never spent more than $90 with me before now came and made an offer of $700 on it. His offer was 50% of my initial asking price, which might seem low, but it was almost full catalogue value for a very fine NH example.  He clearly wanted the stamp and was willing to pay for quality. His offer was almost double that of another fellow who offered me a mere $400 last month.

It just goes to show that waiting for the right buyer does pay off. So now, the total sales for May are just over $3,600, with $2,200 of that coming from repeat buyers - approximately 61%. What is most significant about this is that it shows how customers are developed:

1. This fellow bought from us for the first time last fall and spent something like $10 on a modern issue.

2. He was happy with this, so he bought a few more items in the $10 range over a period of 2 months or so.

3. After 2 or 3 successful purchases he bought a 1932 coil pair for $90 or so.

4. We didn't see him again for several months, probably because we have not yet listed most of our superb early never hinged stamps, and there wasn't much that he was interested in or that he needed.

5. Now he has returned and spent $700 on this stamp.

From $10 to $700. It happens by servicing the customer well, and providing a level of quality consistent with their expectations at a price the customer feels gives them value. In every transaction this customer was in control of the price. He was generally willing to pay very close to full asking as he wants superb stamps. In this instance, he negotiated, but only because my asking price was so far above the catalogue value. I suspect that if I'd had it priced at $720, which is what a VFNH example lists for, he would have just bought it.

In the end this is a better business model in my opinion because it results in ensuring that the merchandise goes to those who appreciate it most. This fellow I can tell will treasure this stamp. The fellow who offered me $400 last month, sees this stamp as a mere commodity in his portfolio of valuable stamps. I would rather sell to someone who I know will appreciate the stamps and their rarity than someone who doesn't appreciate these things.