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Tuesday, July 25, 2017

Closing In On $13,000 Of Revenue For July With Just Under A Week To Go And Not Living In The Moment

With just 6 days left to go this month, we are close to a whopping $13,000 of revenue for July! That is comprised of $9,900 of stamp sales and just under $3,000 of guest revenue from our Bed and Breakfast. This is almost three times our average month. It is nothing short of incredible and should be a cause for celebration. But it has highlighted the problem that I struggle with the most as an entrepreneur: a refusal to live in the moment and a refusal to embrace the freedom that I have worked so hard to gain as an entrepreneur. I'll explain what I mean in the rest of this post.

When I was a kid, I read stories about Japanese soldiers that had been discovered hiding out in the early 70's in some remote pacific island. These few soldiers still believed that the World War II was still going and continued to prepare themselves for battle and conduct themselves as if they were fighting a war. They had lost all track of time and perspective, having spent 30 odd years in complete isolation. I had read that when they were told about the end of the war 30 years earlier, and the state of modern Japanese society, they simply could not accept this reality as they were too heavily invested in the idea that they had to keep fighting.

This describes the same phenomenon I believe that happens to most entrepreneurs who are founding businesses from scratch. We start with an idea and a vision of what it will take to achieve success with our businesses. We know that the odds are heavily not in our favour statistically, so we over-compensate by working harder than ever - working as if we were still being evaluated by someone else, only our boss is the worst one we've ever had: ourselves. This boss doesn't allow us to take vacations, doesn't tolerate any distractions during the workday and never, ever celebrates our successes. Instead this boss constantly reminds us that as well as we are performing, there is still so much left to be done.

Sound familiar?

When I started this business two years ago, my circumstances were different from what they are now: I was living in Toronto, with my partner and considering settling there and buying a house. The expenses associated with living there were much greater than they are here in Saint John, and I formulated a business plan to establish an operation that would be large enough in scale to support the cash flow needs that living in Toronto would require. It took me months and months to complete that plan to the point that I was intimately familiar with every step and every milestone that needed to be achieved. I had a timeline burned into my psyche and I set about ruthlessly and single-mindedly executing that plan.

Only, it didn't go the way I had envisioned. Almost immediately, I experienced setbacks: one of my investors said he couldn't go through with the investment after all, so I had less money than I needed to execute the plan. I suddenly had to incur debt, rather than sell equity in the business. This added to my stress because debt has actual repayment requirements, whereas equity does not. I found that I couldn't list my inventory nearly as quickly as I thought. I found that working with E-bay is fraught with problems that require my time and attention on a monthly or quarterly basis - time that I didn't factor into my plan. Finally, I really didn't think about what all this singular focus would do to my relationships - with my friends, my son and Steph.

Every time I faced a setback, I either redoubled my efforts, or I tried to come up with a different solution. Ultimately, one of these solutions was to leave Toronto and move to Saint John. It was a great move and ultimately, I believe that it saved the business from certain ruin. However, one thing I didn't do when I arrived here was to alter my original plan to reflect the change in our circumstances. Very recently I did recognize that it wasn't necessary for the business to be as large as I had originally planned and I did start taking steps to divest ourselves of some of the inventory so that we could pay off our debts. That was a good first step, and I felt very good for all of about a week, and then I went back to being stressed again.

Why? Well I had spent a lot of time envisioning how success would look in this business. I imagined a scenario where I have all my inventory listed and all my time gets spent listing material as it comes in, having no backlog and filling orders as they come in, while making enough to live on. I still think that is an attainable goal, but I have been getting very frustrated because I feel like I will never get to the point that all my inventory is listed. To me, that feels like failure. But what if it just isn't possible to attain that equilibrium? What happens then? I had to really start thinking about that.

When I really took stock of how the business is doing objectively, I realized that:

1. Our sales are growing by leaps and bounds and are currently enough to support our lifestyle, some reinvestment in the business, and to pay the investors. Once the investors are paid and the mortgage is paid we'll be laughing.
2. I get at least two or three e-mails from different customers every day now, engaging me and building relationships, whereas this time last year I was getting none.
3. I am getting want lists now from customers who trust me.
4. We were just featured in the Canadian Stamp News.
5. Customers have begun sending consignments.
6. One customer has actually asked me to handle his estate when the time comes.

Although this does not fit my original vision of how I thought the business would unfold, is this not success? If all the above things keep happening every month, then does it really matter if all the inventory is listed? Maybe it doesn't.

I know that one of the reasons I am having such a hard time accepting that the sales will continue to be good unless I get everything listed is that it took me so long to start seeing good sales levels. My brain wants to believe that the only reason sales are good now is because of how much inventory I have listed. Yet the experience tells me that it is not a function of how much is listed necessarily: Some of my largest sales this month were stamps that I listed 2 years ago, which suggests that maybe it just takes that long to begin winning people's trust and all indications are that this is finally beginning to happen on a large scale. So while it may still be important to get the material listed, it may not be as critical, in the final analysis as I had originally thought.

What is important though is that I take the time to begin living and savouring the successes that Steph and I are experiencing. I am taking baby steps by having coffee out in the garden every morning before I start work. I hope to eventually go back to eating better, exercising and ultimately ending my work day at 6pm instead of working until 2 am. Being able to do that involves breaking the chains that I placed around myself and doing that, in turn requires me to be open to recognizing that success may not take the form that I thought it would. I have to recognize when I am successful. This I believe is the most important milestone that we can reach as entrepreneurs.

I am sure we probably won't have another month like this for a while, because most of the sales were to two customers who had very extensive needs. However, I have to recognize that this is just fine: we don't have to have another month like this again. As long as we can keep our average sales level at a point where it can cover our expenses, we will be fine. My best insurance policy against failure is to keep meeting new customers and building new relationships. The B&B has done phenomenally well, being almost solidly booked this month, and I always have the accounting to fall back on come wintertime.

So I, and other entrepreneurs like me need to learn to chill. Chill and enjoy the life we have worked so hard for. Chill and enjoy our spouses instead of taking them for granted. Chill and enjoy our relationships with our children and our friends. 

Friday, July 14, 2017

July Continues to be Gangbusters With $7,528 in Revenue Just 14 Days In!!

July will easily go down as our best month ever so far. It is almost feeling like we have hit an inflection point in the growth of the business. Steph has done an absolutely amazing job with the bed and breakfast, and as a result we are booked up solid almost nightly this month. Getting reviews online from guests is always hard, but the ones that have been left so far are excellent. The guests are particularly raving about the food, with one couple from Paris, France telling us this week that it was just like eating in Paris! Steph has really pushed out of her comfort zone and together we have learned how to make breakfasts that are 5 star restaurant worthy: French omlettes that are so creamy and light that you can't believe they are eggs, and crepes with chocolate ganache and fresh raspberries that literally melt in your mouth. Steph takes a great deal of pride in her business and wants to be the best, so she has pushed herself to go beyond the mundane to offer guests something truly special. Having finicky guests has also motivated us to learn how to do basic things very well that we wouldn't have bothered to learn otherwise. For example, one of our guests this morning was allergic to all dairy products, and said he liked sunny side up eggs. I've never been able to make these well. So I learned how to make perfect sunny side up eggs that are not rubbery and overcooked. The secret? Butter or in his case, olive oil, in a very hot pan that is immediately turned down to low after the eggs are added to the pan. Then using a spoon, you baste the egg with the butter or oil which helps cook the top white, and thicken the yolk slightly without making it hard.

I can easily envision us being booked solid next summer several months in advance.

This week we began our marketing effort for the business by including with every order, a copy of the pamphlet and a personalized letter, on parchment, signed by me, thanking the customers for their purchase and outlining all the other services that we provide free of charge. I also began discussions with a marketing firm to design some formal marketing campaigns to try and re-engage former customers who have not done business with us in a long while. Now that we are doing these things, I can see now how our mailings lacked professionalism before, and how this may have hurt us. Initially, when I started this business, I didn't see the point in using nice stationery or printed envelopes and brochures, since I never really paid attention to them myself when I bought stamps. But I now wonder whether or not there was a subliminal impact. My thinking now is that we get so few opportunities to get the attention of the customer, that it behooves us to use those opportunities to their fullest when they present themselves. When someone opens their mail with some stamps inside, this is the perfect opportunity to get their attention with a personalized letter that is specifically directed to them. It it is key that it be about them, and not just some canned letter that they can tell is sent out to everyone. Yes, it is an extra cost and yes preparing these adds a few minutes to each order. But it is my hope that doing this will significantly improve the odds of doing repeat business with the customers. I am very interested and excited to see what the next few months will bring.

Stamp sales as of today, July 14, total $5,541. So even without the Canada #2 for $2,600, we are still averaging over $200 per day of other sales, which is excellent. Revenue for the bed ad breakfast this month so far is $1,987, which brings the total revenue for the business this month to $7,528, and there are still 17 days left to go for the month. Now, we have friends over for most of the remainder of the month, so the B&B will drop off until August. However, I wouldn't be surprised if we do another $2,000 in stamp sales, which would be $9,500 month - almost three times what we did in Toronto.

I'm finally beginning to breathe a little easier...

Friday, July 7, 2017

A Record Breaking Month With Close to $5,000 After 7 Days and A Major Realization

After a very stressful and expense-heavy June, July is shaping up to be an absolutely fantastic month in which I expect that we will accomplish several important milestones. Between good occupancy with the B&B, strong sales and continued work on want lists, we have been able to generate close to $5,000 in revenue already, just 7 days into the month. 

Just over half of this is attributable to the conclusion of a sale that had its genesis back in May. A customer had expressed interest in this stamp:


This is the second stamp issued by Canada, that was issued in 1851. It is one of the few stamps to depict Prince Albert while he was alive. Prince Albert, was of course, Queen Victoria's husband, and he died in 1861, leaving behind a heartbroken Queen who never got over her loss. This stamp usually sells in used condition, with 4 margins for $1,000 or so. However, the above example is a particularly nice one. So I graded it as superb and listed it with an asking price of $3,750. 

For over 2 years it sat in my store. I had several inquiries about it, from different potential buyers, but I was unwilling to sell it for the $1,000 or $1,200 I was being offered for it. My reasoning was that if I sold it to these collectors, then I would not have it when someone who really appreciated, and was willing to may more appeared. 

I am glad I waited. The fellow who offered me $2,600 for it was a prominent collector who had sold his collection of rare classic British Commonwealth stamps in 1999 with Spink. So he, of all people was in a unique position to appreciate the scarcity and quality of this stamp. He made his offer conditional on my obtaining a clear BPA certificate for it. I sent the stamp to the BPA in early May and waited what seemed like an eternity. Finally, this week I received word from the BPA that a clear certificate was being issued and that the stamp would be back in the mail to me this week. I immediately let the customer know and he agreed to take it for $2,600. I listed it right away and had the funds for it within an hour. So I'm very happy that this sale came to fruition. 

Last month I began listing very modern material, i.e. post 1971 material in earnest, as well as my 1960's first day covers - something that dealers couldn't give away 20 years ago let alone sell. Much to my surprise, both are doing extremely well. The first day covers are selling literally, as I list them, sometimes before I get a chance to go back and check the listing for typos. This really is where the money in this business is made: I bought a lot of about 3,000 covers for something like $250 5 years ago, and I am selling each one for between $1 and $3 a piece. You can't beat that!

I also received my brochures that I designed to send out to customers who had not purchased from us in a while, as well as new customers. My goal here was to communicate our value proposition clearly and encourage them to do business with us directly. Here is how the brochure looks:

The Inside:


I've started sending these to my customers with their orders and keeping track of who I send them to. I had been planning to send a mass mailout of these to my old customers, along with a well crafted, personalized letter. However, as postage is expensive, I have decided to obtain the services of a marketing company to help me craft the letter. So that is exciting! I am eager to see what the response of my customers is. 

But just as I printed these brochures, I came to a realization: with how busy just Canada is keeping me and how many under-developed areas there are in my stock, it is very unlikely that I will get around to listing Nigeria for another 2 years, and I may never get enough time to fully study the 50,000 or so covers I have. So I began to consider selling this section of my inventory off within the next year or two. Not having Nigeria will modify the message I am trying to send with my brochure, but I can simply re-design it by the time the collection sells. This was a tough decision and one that I had resisted for the last two years. You see, I had a business plan that I was following from back when we lived in Toronto, that called for us to be making a lot more money than now, and for all of the last 2 years I have been following it, without really wavering. It has been extremely stressful, and it has felt like a race against time to get all the inventory listed. Steph has been extremely supportive thus far, but I have been concerned about the long-term impact of another 2-3 years of this on our relationship. 

I realized that I can probably sell the Nigeria for enough to cover everything the business owes my investors, as well as a good chunk of our mortgage. All of the sudden, I realized that this time next year, we could potentially be almost debt free, with a beautiful house that is almost paid off, while having two fully functioning businesses that between them generate enough for a comfortable living. Could we really be set? Really?

Well, yes, we can. Steph and I have worked really, really hard to build a functioning business, and it seems that our hard work and sacrifice is finally paying off. The key though was to become open to the idea that we really don't need to build a big company with lots of employees. We just need enough to pay the bills and enjoy our lives. Happiness for me really is being able to look up from my desk at noon, and see this:

or take a large cup of coffee every morning at 7:30 or 8:30 and sit here:

Our end-goal then changes from trying to set the world on fire and build a huge company, to protecting our ability to enjoy the above simple pleasures. Thus anything I can do to protect this little corner of the world we have fought for is what I should do. While selling Nigeria and cutting back on ambition may not be the best thing for my ego, the idea of being almost debt free in a year is much, much better for Steph and I over the long run, I think.