{"id":43493,"date":"2019-08-23T20:40:22","date_gmt":"2019-08-24T00:40:22","guid":{"rendered":"https:\/\/www.wendybrandes.com\/blog\/?p=43493"},"modified":"2019-08-23T20:40:22","modified_gmt":"2019-08-24T00:40:22","slug":"flashback-the-agony-and-ecstasy-of-a-small-business","status":"publish","type":"post","link":"https:\/\/www.wendybrandes.com\/blog\/2019\/08\/flashback-the-agony-and-ecstasy-of-a-small-business\/","title":{"rendered":"Flashback: The Agony and Ecstasy of a Small Business"},"content":{"rendered":"

Yesterday’s post<\/a> about the challenges of combining art and commerce reminded me of an essay about small business that I wrote for the Huffington Post in 2012. And, like I said recently<\/a>, it’s occurred to me that I need to republish all my Huffington Post pieces on this blog, because they could vanish at any moment from HuffPost. I’m probably lucky they haven’t done so already; I worked hard on those pieces. So here it is!<\/p>\n

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The Agony and Ecstasy of a Small Business<\/h1>\n<\/div>\n
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By Wendy Brandes<\/p>\n
01\/24\/2012 01:03 pm ET<\/span> <\/span>
\nUpdated<\/strong> Mar 25, 2012
\nOriginal post linked here<\/a><\/p>\n

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I have a small fine-jewelry business<\/a>. I\u2019ve also had a root canal. I think they\u2019re very similar: Forewarned might be forearmed, but it doesn\u2019t eliminate the need for painkillers. I knew \u2014 both from talking to people with experience and plain old common sense \u2014 that the business would be the most challenging thing I\u2019d ever done, job-wise. I was also told that the root canal would hurt. I still needed Percocet for the tooth … and sometimes I wish I could have it for the business too.<\/p>\n

Of course, there are joys to having a jewelry business. I love it when customers tell me that the earrings they bought from me online<\/a> are even better than they expected; that their new necklace is their favorite jewelry ever; or that they can\u2019t take their eyes off their custom-made engagement ring. Redesigning old jewelry is especially rewarding. It\u2019s fun to convert an unworn cocktail ring into three streamlined stacking rings<\/a> or give a lone stud earring new life as a pendant<\/a>. My job even helped me make the most of my root canal: I engraved my gold crown with my initials<\/a>.<\/p>\n

The ache the business gives me \u2014 in a place where molars don\u2019t grow \u2014 comes from a classic small-business conundrum: the high cost of producing low quantity. You might think that problem is unique to my luxury jewelry line, where a one-of-a-kind 18K gold and diamond design can go for upwards of $20,000 and raw-material prices of metals have tripled since I launched in 2005<\/a>. But every small, self-financed businessperson I speak to \u2014 whether butcher, baker, candlestick maker, computer programmer, hair stylist, photographer or fashion designer \u2014 tells me the same story. The problem is the cost of labor. Even when you\u2019re making goods out of inexpensive materials, you need to pay for labor. U.S. labor is expensive because, despite the ongoing recession, the U.S. has a high standard of living and a minimum hourly wage of $7.25. In countries without such a high standard of living, people will work for a dollar a day or less. That\u2019s why manufacturing and other jobs \u2014 including customer-service phone lines, as many of us know \u2014 have moved overseas. Using inexpensive labor enables companies to sell goods or provide services at prices U.S. consumers are willing to pay.<\/p>\n

So why don\u2019t I move my production overseas, especially when a ring that cost $40 to produce in New York City cost $4 in Asia (before last year\u2019s surge in the price of silver)? Forget for the moment about quality issues and the idealistic wish to keep jobs in the U.S. I simply can\u2019t afford to produce cheaply. Factories require bulk orders because they would go out of business selling one $4 ring at a time. A minimum requirement for me is 100 units of each ring style. If I start ordering 100 rings at a time, I need to find a way to sell them or I\u2019m going to drown in inexpensive rings. Quantity orders from retailers aren\u2019t easy to come by when you\u2019re a start-up. As Annie Lin, who, with her sister Karen, had a U.S.-made contemporary women\u2019s clothing line called AIRA from 2008 to 2011, tells me, getting the brand in front of customers was \u201cthe hardest part\u201d because both boutiques and department stores \u201cheavily relied on the \u2018usual\u2019 brands they often order from and leave a small budget for new designers.\u201d Limited distribution means limited profit, which scares off the kind of deep-pocketed investors who would be able to finance mass production. Another Catch-22.<\/p>\n

Because I\u2019ll try anything once, I did the 100-unit order with a few styles, just to see if an inexpensive piece would fly off the proverbial shelf. I sold 30 of one style \u2014 a large quantity for me \u2014 all to individual customers. I made $20 on each sale and 30 trips to the post office. I\u2019d rather hold out for one big engagement ring that nets $5,000 than do that again. At least I developed a better understanding of factories\u2019 requirements for large orders. My factory was giving me a break, really. A hundred units barely qualifies as mass production. Walmart is the gold standard of huge orders: A 2005 Wall Street Journal series<\/a> identified a small<\/em> order of pens for Walmart as 48,000 units.<\/p>\n

Designers like me and the Lin sisters persist as long as we can, praying we\u2019ll have that \u201clightning in a bottle\u201d moment: the right celebrity, the right store, the right press. Sometimes the money runs out before the moment comes. The AIRA line, which retailed from $180 to $550, was in seven boutiques but just breaking even when the Lins pulled the plug. Annie says, \u201cIn retrospect, if we did not find a celebrity to wear our clothing or somehow lower our price point … we were looking at six or more years before seeing profit.\u201d<\/p>\n

Maybe a design award will give me the push I need: I\u2019m a finalist for Fashion Group International\u2019s Rising Star Award<\/a> for jewelry (the awards will be announced on Thursday, January 26). My friend, designer Stacy Lomman<\/a>, is also in an optimistic state of mind because she is a finalist for the Rising Star Award in women\u2019s wear after just 18 months in business. Financially, however, not much has changed for Stacy since 2010, when she was interviewed by the Huffington Post<\/a> about her use of social media to finance her first runway show. Now preparing for her fourth show, she is conducting yet another campaign on the Kickstarter \u201ccrowdfunding\u201d site<\/a> to raise money to buy fabric for the 10 to 12 looks she\u2019ll sew singlehandedly. Being a Rising Star finalist means \u201cI\u2019ve proven that I am someone to watch,\u201d she says. A win could help her \u201csecure some type of corporate sponsorship in order to take my business to the next level.\u201d Here\u2019s hoping that finding that financial backing isn\u2019t like pulling teeth.<\/p>\n<\/div>\n<\/div>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Yesterday’s post about the challenges of combining art and commerce reminded me of an essay about small business that I wrote for the Huffington Post in 2012. And, like I said recently, it’s occurred to me that I need to republish all my Huffington Post pieces on this blog, because they could vanish at any…<\/p>\n

Read More »<\/a><\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_genesis_hide_title":false,"_genesis_hide_breadcrumbs":false,"_genesis_hide_singular_image":false,"_genesis_hide_footer_widgets":false,"_genesis_custom_body_class":"","_genesis_custom_post_class":"","_genesis_layout":"","footnotes":""},"categories":[669,25,147,567,568,355,566,161],"tags":[1243,2126,2127],"class_list":["post-43493","post","type-post","status-publish","format-standard","category-about-wendy","category-business","category-education","category-get-smart","category-journalism","category-prices","category-the-bitchtastic-guide-to-business","category-words-of-wisdom","tag-flashback-friday","tag-huffington-post","tag-small-business-advice","entry"],"aioseo_notices":[],"_links":{"self":[{"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/posts\/43493","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/comments?post=43493"}],"version-history":[{"count":2,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/posts\/43493\/revisions"}],"predecessor-version":[{"id":43495,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/posts\/43493\/revisions\/43495"}],"wp:attachment":[{"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/media?parent=43493"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/categories?post=43493"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.wendybrandes.com\/blog\/wp-json\/wp\/v2\/tags?post=43493"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}