Hello Everyone,
What a roller coaster ride this has been.
Let me begin by saying that I know you are probably angry, frustrated, and tired of being in this thread. Believe me, I understand that.
Also, I would like to say that it was not my intention to disrespect any of you here.
I started this group buy with the best intentions- to offer you guys a deep discount on the products I distribute, to get my name out there. I wanted to start an auto parts distribution business, and this was supposed to be the springboard.
We all know that it didn't work out the way I planned.
It started with my supplier increasing the delivery time from 7 days to 21 days. Those 21 days coincided with Chinese holidays. The wire transfer from my bank to my agent's bank was stuck in limbo for 6 days before they received it. The air freight forwarder, who promised they would hold my hand through this process, delayed the process because they couldn't get Country of Origin, Export License, Import Bond, and Customs paperwork in order in a timely manner. I ended up having to hold their hand through this process. After that, the trucking company that was supposed to deliver the pallets to my garage lost their paperwork, so we had to get the transportation broker to forward that to them before we could receive the shipment.
I guess you could say that EVERYTHING that could go wrong, did.
I didn't want to share any of this with you, because I didn't want anyone to know what a cluster f*&k this was turning into. Looking back, it would probably have prevented lots of heartache if I had kept you guys in the know about all the mishaps.
The sudden influx of emails, phone calls, PM's, and voice mails was so overwhelming, I was only able to answer a small percentage of correspondence requests. When I was traveling on business last week (for my day job) and my wife took over, my phone stopped working, which was why it seemed I disappeared for a few days. You all should know that with a baby and a house to manage, she was organizing orders and dealing with the unreliable transportation broker while I was away.
Some folks seem to think I was just sitting on a big pile of cash, eating bon-bons, and laughing to myself at the expense of my customers. To those people I say, "I invite you to start a business with very little startup capital, deal with international suppliers, and try to balance that with a family and a full time job." Trust me, it sounds much simpler than it actually is.
I've learned lots of lessons by doing this group buy, all of which I'll post here, as a heads up for anyone thinking about organizing a group buy, or just starting a business in general:
1. Communication is key- No matter what the news is, good or bad, small or big, let folks know what's going on. If you try to hold it all in and hope for the best, people will get very mad. Or your head will explode. Not sure which is worse.
2. Under Promise and Over Deliver- This one I think comes with experience. If you think it'll take 30 days, quote 60. If you think 60, quote 90. Missing an estimated ship date is bad news bears, and contributes to people being angry.
3. NEVER pay your supplier 100% of the total amount due up front! You lose all of your negotiating power if you're dumb enough to do this... ahem... Pay 30-50% up front and the balance upon delivery. Pay less of the remaining balance for each day the shipment is late.
4. Get familiar with your supplier's culture- If I had researched Chinese business culture, I would have known that February - March is probably not the best time for doing business. Chinese New Year and Ancestor Holidays eat up 3-4 weeks at the minimum.
5. Screen your transportation brokers and ask for references- I had a smooth talking sales rep who assured me he knew what he was doing. He turned out to be less involved than a deadbeat dad. If I had asked around for recommendations, I would have found a better company.
6. Budget for delays so you can ship by sea, and not by air- My $500 shipping cost turned into a $4,000 shipping cost once the delays started compounding. This is what ate up ALL of the profit that would have been made on this group buy.
7. Get help- thinking you can do something of this scale all by yourself is foolish. Pay some friends to help you out.
8. One forum at a time- This would have been much more successful if I had done one forum per month, and not 5. Communication becomes very difficult. Going from 0-100 customers in 21 days is no laughing matter. You need a team of people just to keep up with the phone calls and emails. Add the PM's, supplier relations, shipping and logistics, and business supplies, and you're running an operation that would normally require 5-7 people on a bare bones level.
9. Kill them with kindness- Yes, there have been times where I wanted to write nasty-grams to members who were taunting, provoking, and generally stirring the pot and trying to incite a riot. I held my tongue, and I really believe that it was for the best. You don't want to feed trolls or risk making angry customers angrier. That's a ticking time bomb waiting to explode.
10. Learn from other people's mistakes- this one is almost a moot point, because you can’t really learn a lesson unless you've made the mistake yourself. 2000UZJ (whom I have gained an infinite amount of respect for) told me about the drama and stress associated with group buys, but I thought I'd go for the gusto and do it big. In retrospect, I probably should have taken a page out of his book.
11. Let your customers know they're appreciated- I really do appreciate those of you who stuck it out and offered words of encouragement through the process. You have no idea how much your words helped me to make it to the finish line.
12. Have a support system- I also have to thank my wife and her parents for their endless support. It was extremely trying to get this organized, and they were such a big help in getting everything into the garage and out the door.
At this point, I have responded to emails, sent out tracking numbers, and have solicited shipping addresses from those whom I did not have one.
I have lots of leftover lights, so if you need anything, you know where to find me.
This was one of the most eye opening experiences of my life. I learned so much about starting a company, people, and international trade. I thought that being my own boss would make me happy. I thought that building my own company would free me from the shackles of corporate America. Boy, was I naive! I never believed that growing too large, too quickly could be viewed as a problem. I thought, "I hope I DO have that problem! That'll be a great problem to have!" Little did I know that when you grow too big too soon, everyone gets to feel the effects. Both positive and negative.
So, as we wrap this up, I want to thank you all again for participating. I hope you enjoy your lights. Please post pictures and leave comments. If you've got any words of wisdom to add to the above, please do.
so how about them chinese twinkies?
