The Fog Lifts

      So by the time March came around, I knew my selling season was over, and I did not have much to show for it.  But that was OK.  I got my feet wet, and I learned a lot as well.  It was now time to throttle back, take stock and do it right the second time around.
      Throughout most of February and March, I did lots of thinking about what I really wanted Moenavi Clothing to be and to do.  I came to the conclusion that the most important thing it could do was to create jobs for former homeless people.  I had spoken with some folks involved with local homeless advocacy groups, who could identify those folks who would be ready to work. I really wanted to be involved in helping any person who wanted to leave the streets find a good-paying job.  This would be the cornerstone of Moenavi’s mission. 
      The jobs would consist of working for Moenavi, probably cutting out patterns or sewing.  People would be trained on the items we donate to homeless shelters, and when they become skilled enough and are producing consistently and with high quality, then they would move to the pieces we sell.  These jobs needed to pay well — not just minimum wage — as well as provide benefits right from the start.
      To fund this, we would use the profit from the sale of hats and other items, but this probably would not be enough, especially early in the game when hat sales would be slow.  But if we could rely as well on money from grants and donations, to supplement the income from hat sales, then Moenavi could fly.
      It became clear at this point that Moenavi needed to become a nonprofit corporation with 501(c)(3) tax exempt status.  This seemed to be the ticket.  By becoming a nonprofit, all the money from the sale of the hats could be used to fulfill our mission, since the manufacture and sale of these pieces is directly related to our mission.  With 501(c)(3) status people who donated money to us could take the tax deduction, encouraging large donations.  Also, many grant awarding foundations require that the recipient have 501(c)(3) status, so this would clear the way for additional funds.
      The fog was beginning to lift.  I could start to see a clearer path ahead.  Everything Moenavi would do would support getting homeless people working, getting them off the streets, getting them to feel good about themselves, and getting them to be a benefit to the community.  I knew this was something that had to be done, and I knew it could be done.  The “how” was the problem, and the more I looked into it, the more difficult it appeared to be.  But I was determined to figure it out.
      The first step was to get writing.  I knew I needed a plan, a business plan.  At the very least, I needed a clear mission statement, a detailed description of how the business would achieve its mission, pro forma financials to determine how much money I would need, a solid marketing plan for selling hats, and basic grant research.
      Once I had a plan written out on paper, I could then begin to get others seriously interested in Moenavi from which I would assemble a board of directors.  Then it’s just a short step to incorporate and, finally, to apply for 501(c)(3) tax exempt status.
      The mechanics of putting this enterprise together seemed straight forward.  It would take time and a bit of money, but I felt confident that I could pull it off.  The tricky part was that I did not really know the people I wanted to help.  I had no direct experience working with homeless people.  But I knew I could get this.  Tune in again for more on this.  Thanks for reading!  Stay well and be peaceful.

Strictly E-commerce, Please!

      Almost from the start I decided to sell Moenavi’s hats on the internet via its own website.  The reasons were several.
      I did approach retail shops in town, but no one seemed very interested.  It was very discouraging, because here I was thinking I had God’s answer to the hat problems of the world, and no one cared.  What was wrong with them??!!  In all honesty, though, I think this reaction was mainly due to my ill timing.  They were already fully stocked with hats for the season and did not need any more. 
      I also have a friend who knows the ins and outs of outdoor retail stores such as REI, Patagonia, and their ilk.  I sent him some samples, expecting good things, but all he could offer for feedback was that the hats were not made in a way that would appeal to the buyers of these companies and that they would be too expensive after they added on their 60% markup.  Essentially, if I wanted to play with the big boys, I would have to bow to all of their demands, even if it meant compromising the quality of the hats.  This was not acceptable to me.  Wholesale was quickly losing its appeal.  Selling through a website seemed to avoid all of these problems.  It seemed ideally suited, actually.
      I decided to design a website and to sell the hats on line.  There seemed to be many huge advantages in selling via the web versus through a traditional brick and mortar store.  The most obvious advantage was that the overhead was almost nil by comparison.  No rent, no employees!  Also, the time involved would be vastly reduced.  A few hours a day tweaking the site and dealing with ad campaigns appealed to me much more than spending days on the road trying to pick up new accounts.  Considering that I was also running another full-time business with employees and headaches, my time was very limited, so the internet seemed a good way, an efficient way to go.
      A huge advantage of e-commerce was that I could tell the story behind the hats — the full story.  With a retail store, I lose all control.  I am completely dependent on their sales staff to tell the story about the hats, and I think it would be safe to say that they wouldn’t, or at least not very effectively.  With a web site, I could tell the full story.  I could drive home the superiority of these hats as well as the charitable benefits they support.  I can really engage anyone who visits the site.  In a retail shop, my hats would probably just be thrown into a barrel with other brands or hung on a rack without anything to distinguish them from the others.  Of course, in the absence of a story or someone to point out the differences, people usually just resort to price in making their decision of which to purchase.  Since mine would probably be at least double, it’s clear they stood little chance of doing well.  I would be completely at the mercy of the retail shop.  That was scary to me.  But on a web site, my hats would not be diluted or eclipsed by other hats.  The focus would be on Moenavi hats, and this would be a big advantage in winning over people.
      Because the costs of doing business on a website are minimal, I could sell the hats for just a tad more than wholesale, which means I could now compete in price with the other hats out there.  Moenavi’s would still be more, but not much more.  With nice photos and targeted copy, I should be able to convince people that the added value is well worth the small increase in price.
      As I pointed out in my last post, I can have a website for each different group I cared to target.  I could provide content that would be specifically designed to strike a chord with members of that group, increasing the chances of selling them a hat.
      Also, selling over the internet opens the whole country, even the world, to me.  And this is very important when selling something as seasonal as winter hats.  Why?  Because when winter is over in the middle of the country, it is still going strong in the northern regions.  Conversely, the northern parts of the country begin their cold season well in advance of the middle of the country. Thus I can extend my selling season tremendously.  A huge advantage.
      Another significant advantage of selling through a website is that I do not need to carry as much finished inventory.  Because of the nature of my hats, because they come in an almost infinite array of colors, because they come in 5 different styles and 4 sizes, a brick and mortar store would have to buy a minimum of twenty hats just to get a representative style and size.  To get a nice assortment of colors as well, they would have to stock maybe 100 hats.  This would not be appealing to a shop.  Besides, it’s not simple to display all these hats either.  But with the website, I can make the hats as ordered.  All I need to stock is the fabric, allowing me to use the fabric most efficiently.  That is, if I have just used all the bluish fabric to make a bunch of “stovepipe” hats and now someone orders a bluish ”biscuit”, well, I’m hosed.  Instead, I use the fabric as needed ensuring I always have the correct colors and styles and sizes “in stock”. 
      Another neat advantage of selling over the web is that I can offer customization of the hats, which would be logistically very difficult to do in a brick and mortar retail store.  Few would want to deal with the inconvenience.  What do I mean?  Well, with Moenavi hats there is a main fabric panel made from handwoven felted wool.  Customers can choose the main color of this panel.  Then there are pile components to the hats as well, and customers can tell us which color pile they would like.  This allows for astronomical numbers of choices, which is exciting and fun for  customers because it gives them a hand in the design of their own hat.  They get a hat with just the colors they have always wanted, the colors that work best for them.  So we could make a hat with a blue main fabric panel with purple pile headband, or a green headband, or whatever the customer wants.  Isn’t this what Dell Computer made their fortune on?  The ability for the customer to personally design what they are buying from you.  Using the internet as my sales platform, I can do the same thing with the hats.  Customers gets to take an active role in what they are spending their money on.  Everyone likes to do this, even with a hat!
      Well, there are the main reasons why I decided to sell Moenavi’s hats through a website.  There is a chance that I will also go with retail shops, too, in the future.  We’ll see.  But I am really sold on the obvious advantages of e-commerce, and I will always strive to make it a very important part of whatever sales mix I decide on.
      Thanks for reading!

Stay well and be peaceful!

Web Design & Search Marketing Go Hand In Hand

      So my initial attempts were fairly unsuccessful, but it was a fun time!  One thing I did was to quickly form an LLC for Moenavi.  I did this for two reasons.  One, to legitimize the business, and secondly, because I just KNEW that sales would be phenomenal, by forming a multi-member LLC and taking guaranteed payments, I could limit my self-employment tax burden.  Well, Moenavi did appear legit, but I never had to worry about the SE tax.  Oh well . . .
      Because I realize I had missed the boat because of the ill-timing of the launch of Moenavi, I figured I would play around a bit with e-commerce and web marketing; areas I was totally unfamiliar with.  So I hit the books, opened up a Google account, and started running Adwords campaigns.  What fun!  But no sales!  My goal, at this point, because I realized that search marketing was an art that took a fair bit of experience to do properly, was not really to make sales, but rather to learn about Adwords; how it works, what the possibilities were, what I could do and couldn’t do.  In short, to play around with it to learn as much as I could for next fall, when I would be ready to play this game with some intelligence.  In in this respect, I was successful.  One thing I learned is that it is easy to get sucked into the bidding frenzy and dump a lot of money right down the gutter with nothing to show for it.  I learned that I needed to learn much, much more over the coming months.  So I am still at it, determined to make this work for me, reading what I can and running little experiments.
      I also, during these first few months, designed and re-designed, and re-designed my web site.  I’m still not done with it. Again, I neede  to learn what was working and what wasn’t.  Using web analytics, which is amazingly powerful and detailed, I could clearly see exactly what people were doing when they visited my site.  I think the biggest lesson I have learned so far is that there are two layers of content you have to worry about. 
      One layer is for the search engine robots.  If you do this right, you will rank high in the organic search results, which is incredibly important, because if you rank high you can throttle back on Adwords, saving money.  So it is important to get this right, which means at the very least you must have a fair bit of text loaded with keywords.  But you must do this in a way that anybody reading it does not know that this is not meant for them.  It must do its job and be well-written at the same time. 
      The second layer of content is, of course, for the humans who visit.  They mostly do not want to read very much.  Give them a nice picture or two and cut to the chase with the text. They’ll stick around.  Too much text, or worse, all text, and you will lose them fast.  Give them a great picture, something that is professionally done and that is relevant, and you will get most of them to explore further into your site. 
      Of course, you quickly realize that this is very difficult to do, because not everyone will be impressed by the same single image.  For example, with Moenavi’s hats, an adult wants to see casual sophistication, a teen wants to see something daring and rebellious, and parents want to see a cute child picture.  You really can’t just put all three pictures on the same page, because they work against each other, presenting conflicting emotions.  What do you do?
      That is the beauty of search marketing where you can have a campaign targeting teens, for example, and when they click on the ad they are taken to a landing page designed especially for this demographic.  If this is done correctly, they will move deeper into the site.  With each further step they take, with each new page they see content that reinforces and is consistent with what was seen before.  You must do this for each of the groups you are going after.  So if there are four different demographic groups, you must design four different sub-sites within your site by altering the text and graphics to suit the particular group.  It’s more work, for sure, but it is much more effective than trying to shoe horn everyone into the same generic and blah site. 
      It’s kind of like when I go into a restaurant I have never been in before.  Well, I’m a vegetarian, so I always look at the menu first before I decide to sit down.  If I see beef this and pork that all over the menu and only see listed way down the bottom, as if it were just an after thought, “cheese plate”  I’m out the door.  This restaurant is not really focused on MY tastes.  But if, on the other hand, I go into a restaurant and see tofu this and vegan that with not a mention of any meat, well how could I possibly leave?  I’m staying — absolutely.  If you design your web site with this kind of strategy, it will work for you.
      Well, I’ve got to take the dogs for their walk, so I gotta go.  Next post I will talk about why I decided to sell the hats strictly on the internet and go the wholesale route.  It’s absolutely fascinating, so I hope you will return!

 

Stay well and be peaceful!

Initial Enthusiasm Leads to Desperation

      From the previous post, you learned about how I came to begin Moenavi Clothing LLC.  In this post, things start to get amusing, as I fumble my way through the process of actually forming the company.  I suppose it had to happen this way, mostly because I put the cart before the horse.
      The large swings in strategy, I attribute largely to the enthusiasm one has for any new business.  It can be quite blinding. Let’s face it, if you have ever had a business idea that you want to see happen, it takes control of you.  It’s a gambler’s mentality.  It convinces you that it will be an instant success that will exceed your wildest dreams.  Ha!  Well, I certainly got hooked by my own ideas.  They held me in a full nelson for a couple of months, and I still have the bruises to prove it!
      I also attribute my initial craziness to the fact that my timing was all off.  You see, what Moenavi does is manufacture and then sell warm winter wool hats; I had the idea to form Moenavi in the first week in December.  You might be thinking, “Perfect!  That’s just when people will be buying hats.”  But no.  The fact is that retail stores have their winter inventory lined up in late Spring.  So they are not looking to add more in mid December.  Also, I began Moenavi in mid December, but I did not actually start to market them until January, after most people would have already bought their hats for the winter season and after any thoughts of buying a hat as a gift were well past.  They already had a new hat, so no need to purchase another.  Christmas was done, gifts had long been bought and opened.  Lions 2, Moenavi 0.
      I also got trapped by my own desperation.  I knew the timing was a bit late, but I figured I could catch the tail end of it.  I knew I had missed the boat with sexy print ads, like in Backpacker or Powder magazine, not to mention that I nearly choked to death when I learned how much those ads cost!  Nearly my entire yearly salary!  So scratch that idea.  Instead, I did what I could do at that time, which was to put together a website and to forge ahead tackling the world of e-commerce.  I quickly learned that this was not something you do casually.  But hey, I can figure this out.  All I need to do is just read a bunch of current books and dive in.  This I did.  Although it’s not rocket science, internet marketing is an art that takes a fair bit of experience to get right.  It also takes time and lots of tweaking.  I’m still working on it.
    So there I was.  I had chased my tail for nearly two and a half months with little to show for it.  Sales were nearly non-existent, and I was out a big chunk of cash and time.  I was tired of being my own worst enemy. Time to throttle back, take stock, and do things correctly.  

    See my next post for more juicy details!

Moenavi Clothing History Part I

Moenavi  (that’s MOO-na-vee) Clothing LLC was legally born on 1/1/08, and I would like to give you a very brief account in this post of whyI formed it.  Future posts will address the the process of forming Moenavi and the interesting and often amusing evolution in trying to think through the formation of a new business, especially a non-profit business.
      For the past two years, beginning in the fall, I have bought fleece fabric from which I make hats, mittens, and neck gaiters.  I then donated these items to homeless shelters in New Mexico.  I’m not really sure where this urge came from, but I do know that it was something that I just had to do. (for more info on this, visit Moenavi’s web site — see sidebar — navigate to the home page, and click on “History”)
      All the money needed, about $1000 each year, came out of my own pocket.  Considering that I live pretty close to the edge financially, it was a sacrifice, but I always felt it was money well spent.  So every two or three weeks during the winter, I sent to the shelters boxes filled with hundreds of items I had sewn.  I naievely assumed that this number of pieces would last them several weeks, but I was very wrong.  In fact, within hours after the boxes arrived at the shelters, everything was distributed.  This was an eye opener to me, and brightly highlighted just how great the need was for the items I made. 
      During the summer after that first year, I learned a lot about just how serious homelessness is in this country.  It stunned me, and armed with this information it made me realize that my newfound “hobby” had more urgency than I had realized.
      During the second winter of doing this, I enlisted the help of volunteers to help with the sewing.  I still bought the fabric with my personal funds and cut out the pieces, but with the help of other folks, we managed to make over 600 pieces, which were sent to the shelters.  But still this was not enough.
      When the fall of the third year, 2007, rolled around, I felt like all my efforts were so insignificant as to be futile.  I really needed to find a way to scale up this homeless operation.  That’s when the seed of Moenavi Clothing was planted.  After reading “The Cathedral Within”, by  Bill Shore,  I immediately came up with what I thought was a brilliant (ha!) idea that would solve my dilemma.  It was to make hats that I would sell and then using all the after tax profit, I would buy the fleece fabric from which I would make the items that I would donate to the homeless shelters.  Perfect!
      I thought the idea of a “for-profit” charity was a clever way to fund my altruistic project.  And it was!  But there were some serious considerations that I was not aware of during these early stages, and in the next few posts, I want to share with you the bumps I ran into.
      The interesting thing about the initial idea for Moenavi was that I had a deep inner need to help homeless people stay warm in the winter.  Who knows why?  It was an inner command that I listened to and then acted upon.  The action could have taken many forms, but something led me to form a business to fund the charitable act.  The interesting thing is that many times during the first two years, I consciously tried to drop this project.  I mean, I was already working very long hours running a weaving business, so my free time was very limited.  I really just wanted to relax with a nice book or go hiking with my dogs during my free time.  But I kept getting pulled back into doing this homeless gig.  So I’m not doing it for any kind of self-satisfaction or ego enhancement.  It’s not something that I have forced to happen.  It’s more like eating — it’s something that won’t let me forget that it needs to be done.  So finally, I just gave in and decided to let this project, Moenavi Clothing, run its course using me as its agent.  So here I am!
      I’m wondering if anyone else has had a similar experience?  I’d really be interested to hear all about it.