One of the fun things about working online is the ease with which you can add and subtract content. At the drop of a hat I can cut a feature that isn't working ("d*s snaps") and add one that does ("mini-trends"). The internet's ability to change quickly also works to the advantage of someone as antsy as myself. I tend to get bored with websites (especially my own) faster than I'd like so I appreciate being able to get a new venture up and running relatively quickly. One of those ventures was the D*S Shop. Running the shop has been one of the most challenging things I've done yet, but thankfully I've found some great online resources (and people) to help me get my footing along the way. Since so many readers are running small businesses and considering starting their own shops I thought it might be helpful to share some tips and talk about the day-to-day reality of running an online shop.
[One quick note before we get started: the D*S shop is a non-profit shop in the sense that I've opted not to take any of the proceeds from the shop's sales. I chose to give the designers 100% of their proceeds and sell advertising on the shop to cover the cost of taxes and fees. That said, I still deal with all the day-to-day details like orders, credit cards, inventory, shipping, customer service and finances like any other shop.]
My shop was inspired by stores like Tiny Showcase, Etsy, Sodafine, Rare Device and Relish. Seeing relatively young people (especially young women) running their own shops and managing to stay above water was something that kept me going when I decided to take the leap. Tiny Showcase was the main influence behind the format of the shop: independent designers, affordable prices, limited editions and giving back. I knew it would be important to me to give back in some way (which is why I donate a percentage of the shop's ad revenue to a different charity every month) and let the designers keep as much of their money as possible. So I sat down and asked myself the following questions:
1. Why am I doing this and will this serve some purpose for my readers and the community at large?
2. How will I cover the costs without taking money from the designers?
3. How much time will this take and how will I manage responsibilities on my own?
I didn't know the answers right away so the first thing I did was talk to people around me. I called up friends and readers who ran shops and asked them what they wish someone had told them before they started a shop. The answers I heard most were:
1. Make sure you have enough money to cover starting costs. It's expensive to invest in the initial design, photography, materials, shipping, etc.
2. Make sure you speak with a financial advisor about taxes and regulations. California and NY especially.
3. When in doubt, have customers sign or agree to a policy that protects you from unfair lawsuits or charges.
4. Know when to ask for help.
I took all of this into account and in the meantime emailed designers I'd met through my site to see if they'd like to be a part of the shop. Once I had about 40 designers lined up (with 6 designers showing a month), I knew it was time to get the ball rolling. It was at this point that I remembered number four above: know when to ask for help.
Up until now I'd done most everything concerning my site entirely on my own. No interns. No employees. A control freak by nature, the idea of giving someone access to my passwords, content, etc. was terrifying. But part of running something bigger than I'd done before was recognizing I couldn't do it on my own. So I turned to a graphic designer named Kate Klapfish.
I'd worked with Kate before to help with some coding issues so I knew she would be great to work with. Thankfully she understood the plight of the small business owner (being one herself) and agreed to help me out for a percentage of the ad revenue from the shop. So, after a bit of reformulating I created a budget that allowed me to dip into my main site's ad revenue to cover the costs of taxes, fees and Kate's retainer. She worked with me to design the look of the site and incorporate a logo I'd hired artist Alice Stevenson to create. Once the look was finished and the product information loaded, Kate helped me deal with the financial issues by setting up a shopping cart via PayPal (which let me choose to accept PayPal accounts and Credit cards- for a fee, of course) and set up an account with Mal's e-commerce. And then suddenly tip number one came into effect: start up costs.
Once we started the PayPal account and Mal's account the fees just kept coming. 3% here, 5.5% there. It just didn't end (and it still doesn't). Luckily I had my ad revenue from the main site to cover these fees but I highly suggest finding out all the hidden fees including with services like PayPal, Yahoo, Mal's and other shopping cart vendors to make sure you've covered everything before you get started. They add up quickly.
With the shop designed and the cart ready to go I talked to the designers about shipping. My concern was getting products to customers all around the world quickly and for the lowest price possible. Since a number of my designers were in Europe I decided to have them send their entire inventory to me to ship from my apt in Brooklyn. While this ended up saving people up to $17 on intl shipping fees it ended up being one of the most time consuming decisions I'd made. Exhibit A:
Here is one of the shop's wonderful designers, Matt of Sesame Letterpress mailing coasters from his living room. This is the real life of independent designers and small business owners. Mailing, shipping, label making- it's all done at home and it's most often a mess. I take in at least a few products a month to mail from my home and I'm inevitably covered in labels and mailers for weeks until we're sold out. Here are some tips about mailing:
1. Track everything. It make cost a little bit extra but when someone tries to stiff you for $250 in goods it's helpful to have a receipt saying they received it.
2. Invest in a PayPal account that lets you print labels via the USPS. I can do everything from my computer at home and skip a trip to the post office. I didn't do this the first month and after hand-writing 150 labels and waiting in line for over 2 hours I decided it was worth the investment.
3. If you're mailing prints or photographs it's worth investing in those pricey waterproof mailers from Staples. I used thick (and I mean thick) cardboard mailers to mail Camilla Engman's prints and they managed to still bend (even with "do not bend" stamps) and result in needing to replace customer's prints.
4. Stay in contact with your customers. If you need to mail something late just let them know. If you're running a small business most people will understand if you're running a tad late or if there's been an error. I had some products get stuck at customs and my customers were very understanding about the slight delay once I emailed them individually.
So every month after Kate has kindly built the pages for each customer and updated our cart I track each individual order, direct it to the right designer and make sure orders are being shipped on time. If it's for an intl designer I mail things myself using my PayPal account and mailers I buy at Staples. However, if you're mailing more regularly it probably makes sense to start an account with U-line. Their prices are better and you get discounts for buying in bulk.
If you've got products and shipping down now you're left with inventory and customer service. I track the inventory of every product (we don't have a service that does that automatically) and make sure we're not selling product we don't have. After that I'm the go-to for all comments, complaints or questions with the site. If you can afford to hire someone to deal with this aspect (or wrangle a spouse into it) I highly suggest it. After reading dozens and dozens of emails asking for layaway on a $13 coaster set or if they can get something for free because they read your site you run the danger of losing your polite tone. I find it's best to wait a bit before I respond to emails like this. The last thing you want to do is be rude to a potential customer. But keep in mind that some people will try to get things as cheaply as possible. So if you don't offer layaway on a $13 item (one customer wanted $13 spread out over 3 months) be prepared deal with a customer that may still be upset and rant about it being unfair. It's just part of running a shop.
After you've got things going there are some great online resources that have been invaluable to me. First and foremost is THE SWITCHBOARDS- a site with a forum and helpful articles on running a small, indie business (with an emphasis on women). Every issue I've ever had has been addressed on here and their advice is wonderful. This site has also been extremely helpful with details regarding legal issues and finance. And last but not least- connect with local business owners in your area. Even if you run an online shop it helps to have people near you that you can talk to about issues, concerns or just connect with to test out ideas. I've started a local Business Women night in the NYC area but I suggest checking out Meet Up.com to start your own or see if there's already a small business owner meet up in your area.
I hope some of this has been helpful for those of you running (or thinking about running) your own shop. As always, I'm happy to answer any questions I can via email so please feel free to email with questions or concerns about getting your shop up and running. If I can help I'll do my best to connect you with someone in your area who can.














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Comments (25)
Thanks for all the info!
Posted by Janvangogh | December 5, 2006 2:38 PM
Posted on December 5, 2006 14:38
Thank you for such detailed and honest information!
Posted by ESoule | December 5, 2006 3:49 PM
Posted on December 5, 2006 15:49
Great advice, thanks so much for taking the time!
Posted by amy | December 5, 2006 3:53 PM
Posted on December 5, 2006 15:53
I am glad you posted this. I guess all the wiseacres from the previous posts haven't said much because they realize how wrong they were to trash you when they didn't know what they were talking about!
I think this post is GREAT but it has discouraged me from trying to start a shop!
Thanks for saving me the pain of failure!
k bazzani
Posted by mrs bazzani | December 5, 2006 4:17 PM
Posted on December 5, 2006 16:17
Oh no! Don't be discouraged from starting a shop- I just wanted to be honest that there are some definite things to take into consideration. Believe me, if I can run a shop I bet you can ;)
The key things to take away are: know when to get help (it's worth it), plan plan plan your finances and make sure you're ready to put in the time. Or, the bottom line would be: make sure you drop ship ;) I was happy to save customers the cost of intl shipping but man is shipping lots of tiny prints a pain in the butt. I have so much more appreciation (and I already had a lot) for independent artists running small businesses from home.
If anything running this shop has made me recognize how much work small shops and designers put into their their business. All the people who felt that these discussions weren't legitimate because the business being discussed was "too small" have no idea how much work it takes to run a small, home-based business. If anything you have to be extra savvy to make it all work from home when you don't have the help of employees, large manufacturers and in-house shipping departments.
D*S
Posted by design*sponge | December 5, 2006 4:29 PM
Posted on December 5, 2006 16:29
Grace - I LOVE your site and this bizbox is wonderful. I wish I was still in NYC! Thanks for all the generous advice that helps us planners, plan less and do more because so much is right here:) Good luck!
Posted by Lisa | December 5, 2006 4:45 PM
Posted on December 5, 2006 16:45
Grace - Ask and ye shall receive. Your site is incredible and always seems to hit the nail on the proverbial head. I was just speaking with someone about needing this information last week and lo and behold here it is. I adore your site, have made it my homepage ever since discovering it a few weeks ago, and truly appreciate your openess to sharing your ideas and projects with the rest of us design-o-philes. Keep up the fantastic work and Happy Holidays!
Posted by Ana | December 5, 2006 5:32 PM
Posted on December 5, 2006 17:32
Thank you THANK YOU Grace for another wonderful post. Your invaluable advice keeps my head up when the struggles of owning a small business have me down. =)
Posted by Christine | December 5, 2006 6:03 PM
Posted on December 5, 2006 18:03
Great post.
I did a search for Rare Device and found another great article with helpful tips on doing e-commerce.
Rare Device is in that article too... they must be doing something right.
http://trunktbtd.com/news/2006/12/04/e-commerce-to-the-rescue/
Posted by Anon | December 5, 2006 6:45 PM
Posted on December 5, 2006 18:45
While your article does have some excellent advice (Don't be afraid to ask for help!) I'd like to point out don't be afraid to do it all yourself either! I got my shop up and running with only 1 fee to yahoo for monthly site hosting & plenty time spent on google & The Switchboards finding out things like What is OScommerce?
Posted by Carrie | December 5, 2006 7:10 PM
Posted on December 5, 2006 19:10
Hi Grace -
I just wanted to say that I love your wonderful eye and design your blog. . I read it daily -also thanks for the tips for the small biz owner. I was wondering in re to keeping track of your inventory - do you use excel or any other specific type of program?
Thank you so much.
E.
Posted by elizabeth | December 5, 2006 8:36 PM
Posted on December 5, 2006 20:36
Thanks for all your comments guys, please feel free to email me with any questions. I'm happy to help if I can.
E- I actually just keep a little excel tally on my desktop but the Mal's program provides a monthly tally according to product- very handy for double checking records and comparing intl/domestic orders.
d*s
Posted by design*sponge | December 5, 2006 11:41 PM
Posted on December 5, 2006 23:41
hi k,
you're right to be cautious about opening an online store. if you do not sell unique products like d*s you may be caught in a race to the bottom with product prices. most customers are looking for the lowest price and will shop around till they find it. unfortunately there's always someone out there with a lower price. if you were to lower your price to match theirs, they'll go and do you one better.
another problem is when you create an original product and a company with a wider audience and larger bank account adopts it as their own. soon you'll have steam coming out of your ears.
i do want to point out a few other options for building an online store. over here we use miva merchant for the store, quickcommerce for accepting credit cards and ship works to process ups and usps shipments.
good luck.
Posted by tedkat | December 6, 2006 5:04 AM
Posted on December 6, 2006 05:04
Grace,
Great article! I, too, can't believe how much time I spend shipping! All of my local UPS stores know me by name.
I used to get so many emails asking me when their order was going to arrive. That is until I found the option on the UPS site that automatically sends my customer their tracking number when I ship their package. Since I have used this feature, I haven't gotten one email asking "Where are my cards?" Too bad it took me so long to figure it out :-)
-Annie
Posted by annie | December 6, 2006 11:43 AM
Posted on December 6, 2006 11:43
Go Grace! This post was jam-packed with info. Wow. I'm clicking links like crazy and going to refer to this post on my site... You rock, woman!
Posted by Michelle Goodman, author of The Anti 9-to-5 Guide | December 6, 2006 1:37 PM
Posted on December 6, 2006 13:37
you are a true gem, grace. thank you for this.
Posted by bella | December 7, 2006 6:25 PM
Posted on December 7, 2006 18:25
Great article- I'm certainly going to look into changing my PayPal account to use the print/ship feature from the usps.
One place I'd like to recommend is nashvillewraps.com. They have some of the same products as Uline, but they're less expensive & the minimum quantities are often less as well. They do tack-on a $4 service charge if your order is less than $50 (I think it's $50). Uline has a bigger selection and shipping is cheaper because they have several warehouses across and ups ground gets there in 1-2 days. But Nashville Wraps is worth a look.
Thanks again, Kate
Posted by kate zimmerman | December 9, 2006 10:55 AM
Posted on December 9, 2006 10:55
That Matt guy from Sesame looks familiar. Is he in a band?
Posted by el-oso | December 9, 2006 11:50 AM
Posted on December 9, 2006 11:50
Tedkat,
How do you like Miva Merchant? We currently use Prostores for our site but are finding that certain functionality is missing for the way we'd like to do business. Miva is on our list of programs we're considering (as is Xcart) and I'd love to hear what a real user thinks of it.
Our challenge is to make sure the customer has a good experience shopping with us. We want the site to look and function well and the behind-the-scenes order processing to also put their needs first. Plus, it needs to be efficient for us. If we're spending a lot of time processing orders, updating inventory status, etc, then we're not able to spend as much time marketing our store, refining it to make it easier to shop, or adding products to the site. (We have a bricks-and-mortar store too and, at this point, not every product we carry makes it to the site.)
Posted by Juli | December 9, 2006 12:01 PM
Posted on December 9, 2006 12:01
Excellent info! Welcome to retail and best wishes with your shop :-)
Posted by iheartpaper | December 9, 2006 10:34 PM
Posted on December 9, 2006 22:34
I think this column is excellent because it's giving a very accurate picture of how extremely challenging it is to run a small design business. That photo of Matt in his living room is a cautionary tale of what it's really like! I tried to run my own design biz, but after 3 years, and despite some success, I decided that the personal wear & tear wasn't worth it. The fact that you're giving people such a real picture is invaluable. Unfortunately, being a great designer does NOT make one a great business owner.
For the future, would love to see your POV on the big business cribbing innovative design ideas from small business. That to me was the single most disenchanting thing about that whole world. I know that's not unique to design, but I think independent designers aren't typically prepared to cope with it.
Posted by Ava | December 11, 2006 8:51 PM
Posted on December 11, 2006 20:51
hello
i totally understand the frustration with the customers! i am proud that i offer affordable prices to customers and customers try to bargain and then the payment is late. things like this just make me want to go bang my head against the wall! thanks for you honesty. i really love your passion that just oozes out of your words.
cheers,
cindy
Posted by cindy@staged4more | December 25, 2006 5:51 PM
Posted on December 25, 2006 17:51
This is an excellent article, and very helpful to those who want to start their own stores. Clearly, it's not just a matter of preparing lots of merchandise and hoping for the best.
Posted by Lynn | December 27, 2006 11:26 AM
Posted on December 27, 2006 11:26
I concurr with the others.
A very helpful article to an artist just venturing into the mail order business.
So any things to take into consideration... fortunately I can keep most of my overhead low, except for the fact that I like to buy my watercolor paper in Paris :)
It's an ongoing learning process.
One important lesson: good customers know what they want. When they hear the price, they buy or walk. But if there are 15-17 emails and reserves requested and multi-changing of mind - run away as fast as you can.
I love the chaotic designer photo - way too accurate at times.
Thank you, Grace
Posted by ParisBreakfasts | January 1, 2007 3:34 PM
Posted on January 1, 2007 15:34
Great advice, thanks ;)
Posted by Dmitry | April 2, 2007 4:41 AM
Posted on April 2, 2007 04:41