Shopping small, local brands online has never been easier thanks to niche, direct-to-consumer brands that are now as convenient as Amazon. Unlike a few years ago, my favorite small shops offer one-click payment, free shipping, free returns, one-day shipping and seamless in-store pickup.
This delightful e-commerce revolution is largely powered by platforms like Shopify, which grew its revenue by 86% in 2020. Shopify promises entrepreneurs that there’s never been a better time to start an online store.
But how easy is it? When my neighbour built a shelf that straps onto a tree for outdoor socializing, I offered to help him find more customers and took Shopify for a test drive!
In two weeks we accepted $4000 and donated $2000 for our local foodbank. Here is what we learned:
1) Facebook groups are great for quickly gauging interest in your product
Before going to the trouble of creating a Shopify store, I shared our product story in a local Facebook Group to assess demand. The post generated 6 sales in two hours, so I knew we were in business! I made similar posts in three other Facebook groups, which generated a total of 746 likes, 190 comments, and 17 sales.
2) Setting up a Shopify store is the easy part
Setting up a Shopify store is extremely simple. We used Shopify’s domain service to buy treeshelf.ca, which automatically took care of hosting and even automated email forwarding from email@example.com and firstname.lastname@example.org to my personal email. The domain was $19USD and Shopify is $29USD/month. We customized a basic theme with our photos and messaging, filmed a set-up video, and wrote an FAQ. The whole site was up and accepting payments within a day.
3) It pays to invest some time in a press package
The popular Facebook posts attracted interest from BlogTO. We answered the reporter’s interview questions, shared some extra photos and drafted a full press release that we hoped would help the reporter tell our full story. We were glad to see that she used a lot of the extra context, which made the story richer.
The BlogTO post received 3,300k FB Likes, 221 comments, 287 shares and led to 20 sales.
The BlogTO story also drew interest for radio interviews with News1010 and ZoomerRadio. The News1010 recording was re-broadcast in other Canadian cities and led to 3 sales in Winnipeg. Global News also asked us to appear on their segment, “Making a Difference”. But later that week, for better or worse, the TreeShelf story was overshadowed by news stories about Toronto’s reopening and our story was canceled.
4) Large products are a logistically demanding
Fulfillment was our venture’s biggest challenge. We offered free local delivery and $10 delivery across the GTA. Our fee turned out to be too little for the time and effort deliveries demanded. We evaluated two alternatives:
Carrier Shipping: Shopify has extremely elegant shipping solutions integrated with FedEx and CanadaPost. For our 10-pound shelves, shipping was between $22 and $35 per order across Canada. We shipped three shelves to Winnipeg and the technology worked great! However, it would force us to buy and store large boxes, packing materials, and a printer. We’d also need to transport the 10lb+ packages to the post office regularly.
Local Shipping: We evaluated a same-day local shipping service called Swyft, which integrates to Shopify and delivers all across the GTA. If we could maintain our GTA shipping volumes at 45 shelves/month, the service could cost as low as ~$13/order but we still needed to box the shelves to protect them from damage.
5) Product cost structure must align with founder goals
Since we launched TreeShelf.ca on a whim during a very boring lockdown, we didn’t consider labor costs for delivery, shipping, packing, marketing, or customer service. Of each $75 order.
- $26 went to charity
- $3 went to payment processing expenses
- $21 went materials
- $25 went to shelf-building labour
Somewhere between order #1 and order #49, fulfillment and sales tasks became a burden and our pricing wasn’t high enough to outsource them.
6) It takes commitment to weather ups and downs
Because of our exciting story and timing, generating our first 50 sales was relatively easy. But like any venture, we hit hurdles. To continue selling TreeShelves, we needed to:
- Adjust our pricing and cost structure to allocate more money to fulfillment, sales, and customer service
- Come up with a returns/refund strategy and budget (just in case!)
- Find a third party logistics provider or partner (storage, packing, deliveries)
- Explore new marketing and sales strategies like Facebook/Instagram ads, in-person markets, outdoor wedding and event planners, patios, and FB Marketplace
My neighbour and I ultimately decided to happily wrap things up.
In two weeks we sent 49 TreeShelves into the world, donated $2,000 to our local foodbank, and got to practice our carpentry skills. I learned that it is fast and easy to set up a direct-to-consumer product company in 2021 and am now on the lookout for small, light products for our next project.