EP 354: How Do I Deal With the Uncertainty of Shifting My Biz From a Side Hustle to One That Pays the Bills with Marissa Hess

2:22PM May 16, 2022

Speakers:

Tracy Matthews

Keywords:

business

sales

laser

positioned

people

piece

marissa

gemstone

point

bit

wholesale

marketing

increase

jewelry

sell

grow

side hustle

visionary

price

called

taking the leap and transitioning from a part time side hustle or side business, and going all in on your jewelry company can be stressful, exciting, or scary, exciting. However you want to say it right? But there's one thing for sure. You know, there is a lot of uncertainty and growing a business and sometimes you're not really sure where to start first, and on today's Ask Me Anything episode, we're going to discuss this topic as I coach Marissa has of OSA Design Lab, she's going to share with us a little bit about what she's been going through since her and her husband both quit their full time jobs to go all in on their business. So before I dive in, I'm Tracy Matthews. I'm the chief visionary officer of flourish and thrive Academy and the host of the thrive by design podcast. And I help jewelry designers and makers grow their sales to multiple six figures and beyond using our methodology called the desire brand effect. And we do that through our courses or coaching and my best selling book called The desire brand effect standout in a saturated market with a timeless jewelry brand. So Marissa came to me she is a student in our Lena Foundation program, have kind of a little bit nervous. She was scared to come on the episode. But she had a question and she was not sure how to handle this, you know, they committed to quitting their full time jobs. And going all in they had some runway because they've been saving money for a while for this opportunity to grow their business. And she's like, how do you juggle it all? How do you do it and overcome this uncertainty of not knowing what's next, while staying focused on what you need to to keep your business growing. And so the conversation was super interesting. And I hope that this adds value to you, and you get something out of it. So make sure that you watch the full episode. If you haven't done so yet, make sure that you subscribe to our channel that you click that little notification button. And if you liked this video, make sure you like the video and share with us one key takeaway at the end of it. So let's dive in to this Ask Me Anything episode with Marissa has.

So I'm here on another Ask Me Anything episode to coach Marissa has Marissa, thank you so much for being here today.

Thanks for having me.

So tell us a bit about your jewelry brand. And we'll start from there.

All right, I make modern statement jewelry for heart centered people with love wood and a laser. And it is a company that my husband and I started back in 2018. And it was kind of you know, he bought a laser in the middle of the night. And the next day, you know, when I woke up, he let me know that he had bought a laser. And, you know, I knew he'd been looking for years. But I wasn't expecting that. But anyway, he he cut a snowflake for me in wood. And I was absolutely hooked. And it just, you know, it kind of coincided with when I was doing my yoga teacher training. And like this whole new world of possibilities was opening up for me ways of living and being that I just I never knew about before. And it freed me to become the artists that I had always been but had always denied that I was so so yeah, so that was three years ago, four years ago now. And he kept his full time job until just this past January, at which time he came on full time to be with me in the business. Awesome. And so yeah, it's been I've been selling on my website, I do a lot of pop ups. But of course, the pandemic kind of change that. And so with the focus moving to online sales, that is a spot that I needed a lot of assistance with. I

didn't understand how to grow that. So now we're just we're making it go full time.

Awesome. That's exciting. Well, what's the name of your company so everyone can find you?

We are OH S Oh, Design Lab.

Okay, awesome. Okay, so Marissa, what is your question today? What can I help you with?

I want your guidance. I want to know what you would tell somebody who is moving from a side hustle where they have a choice to do the work or not to running a creative business full time. Yeah, being the artist and then also being the marketing and being everything else. I am not sure I'm not sure how to do that. What kind of advice would you give somebody in my position?

So what is the biggest concern right now? Are you freaking out because of In sales, or is it just juggling everything? Or is it all of it?

It feels right now like juggling everything. Okay, I Yeah, it definitely feels like I'm just juggling everything and really unsure how to delegate and move things off of my plate like I want to be a leader. Right? So moving things off my plate so that I can be working on the business rather than in the business.

This is such a great conversation. And do you feel like your sales are in good enough place where you're feeling okay with that? No. Okay. Do you want to talk about that first?

Um, yeah, we can talk about that. I guess that what I would say about that is that we started the business with the intention always of pulling him out of the tech industry. And through a little bit of a windfall last year, you know, we were put in the position financially to have a runway that would free us from from the paycheck. And so we do have, we have a runway we have, we'd have about 18 months to really make it grow and make it come into what it needs to be. But I also think that in order to support us and pay our bills, we need to be at about four times the sales that we have now.

Okay, and what's your average price

point? 20 $20.

Okay, awesome. So $20, so you're gonna have to do volume in order to how many units? Are you selling a month right now?

Do you know Tracy, off the top of my head? I do not know that information. Okay. Well, just I wish I did.

That's all right. So the best, okay, so first and foremost, when it comes to sales, like the easiest way to reach a sales goal is to reverse engineer what it's actually going to take to get there. So if you need to, for extra sales, like in a reasonable timeframe, what's it going to take to get there? And what are some other avenues that you could take to potentially get volume orders that could support the individual one to one because a $28, average price point online is pretty low. And unless you're getting a ton of traffic to your website, and a ton of volume with the orders, that it's just not a lot. So you might want to consider just some other ways to sell. So Wholesale is always an opportunity, I think you guys have a really cool product. And it's something that the right stores would actually buy a lot of because you know, something that's, you know, $12 at wholesale, or something like that isn't going to break the bank. And it'd be something that they could, it could be like a fly off the shelf kind of thing, because your designs are really cool. And they're light when you're getting them in the right store. So I would start to consider like, what are some of the other sales channels that I can lean into to help increase volume of units. I mean, the thing with Wholesale is like, your $20, retail price point, you know, that gets cut in half when you're selling to a store, whatever. But if you had someone who was ordering like 100 units at a time, that might make up for it, assuming that you have the capacity for it. The other thing that I want you to think about if you were to for extra sales, can you guys handle the production on that?

I don't think right now we could.

So would you have to hire someone else? Possibly, yes? And would you? Would you be able to make that investment in the person based on your current margins and everything that's going on?

I don't think that we could actually, realistically, I don't think that we could.

Okay, so this is something that I really want you to think about and not to freak you out with, oh, shoot, like, I don't have a business anymore. But how can you think strategically because you wanted me to help you work on your business instead of in your business? And visionaries, are problem solvers. So what would need to happen? Or what could you create from a more elevated standpoint, that would increase the price point of your work? That could get you where you need to be in a way that works? The first thing that comes to mind would be from a design perspective. Can you laser cut jewelry? Can you laser cut silver with your laser?

No, we cannot. Okay, cannot there's no materials but not metals? Would you say? There are other materials but no metals? No high end materials? Really?

Core is something like this. Someone needs to be mounting the labor? Is it our human has to man the laser like every for every single piece? Yes. So there you guys have to think strategically and through like how can you create more efficiency in your production process so that it doesn't require a human to be standing there and so that you can get more volume out of the work? Maybe Maybe it's just raising your prices as they are right now. Maybe it's something else completely. I don't know what your margin is, but there might be room for you to be able to increase the prices because what like the earrings you're wearing right now that I see. It's like a three tier Yeah, yeah. What are you charging for? Those are fees are $30? Because I feel like you could charge $50 for those at retail. Really? problem

I have been working with your pricing module. And right now we are at two for retail two to for, or I'm sorry, two times two for wholesale times to two for retail.

Yeah, well, the cool thing that about things that don't have as expensive materials is there's probably room for a little bit more margin there. So I don't know, you'd have to test it in the market to right.

And we did just push our prices. And on some of them. I mean, there were I had a couple of pieces that I ended up repricing at about a 30% increase. We're still talking going from 24 to $32. So they're still low price. But we are currently doing wholesale, which is a market that I would love to grow. And we I do I'm about to get on fair to that wholesale off, which I know I've been looking a lot at the at their margins and what their commissions are

to add a commission on top of your pricing. Yes, yes. I wait 15 to 18%. Over that which you sell. I think I still think you're a little bit underpriced. Okay. All right, I think. And maybe 48 at retail would be too high. But you have to test it because I think that if you people would pay like, to me if I saw those in somewhere, I mean, Urban Outfitters, I'd probably pay $32 for it. But if I saw it somewhere else, and it didn't work, or sometimes store, right $48 I wouldn't even I wouldn't even flinch. At that price point to me, like that's what the all the polymer clay stuff is going for, I would look in the eye. And also this is laser hand laser cut by human. So like I think part of what you need to be communicating is the labor that's involved. And so that's a big problem that needs to get solved, right there is how do we elevate the perceived value of this item so that we can charge more? And how do we get more volume orders? And how do we handle capacity, if we are going to get more sales, because Wholesale is great. But if you're making like let's say you at a 12 unit minimum and your margin is $10 on a wholesale piece, so you're making $10 markup, or $12 or $15, whatever, and you have a 12 unit minimum what is that if there's if it's $10, that's $120 profit, or like markup, right? Total, it's not that much. So, like you have to work on that a little bit. Okay, even though you've already raised your prices, you need to probably push it a little bit more, or increase the perceived value so that you can write maybe it's adding gems to it. Maybe it's adding more like precious like silver or something like that.

So can we talk a little bit about that? Because I do there's like a mindset thing for me there. I would love to incorporate more stones into my into my line. I know that and I'm not talking like diamonds or anything like that. But you know, quartz and Selenite and stones Gosh, I don't even see I don't even know about that. You have gemstones that and I am not confident enough. I don't I feel like I don't really know about that world. And so it makes it feel intimidated to enter it. Just do it. She says just learn it.

No one really knows about it until they learn it I mean, I mean if you're just gonna use like crystals like you could just there's a right here behind me I'm not like the gemstone, I will show you this is Crystal Bible number three there, these are just books you find you can learn about crystals. Sorry, I finally faded out because I walked away from the microphone, but you could learn about crystals as a crystal Bibles there, the gemstone dealers can educate you about them. And there's a lot of googling that can happen for you to learn about gemstones. Yeah, you're not going to be using things that you need to go to GA for and really learn about like refraction and all the stuff that is in like to tell if a stone is fake or real. Like that's not going to be important to you. You don't need training on this you just need some research. Right? Okay Don't worry about that can actually serve you because you can increase the value like if you had a wood element and then like a crystal drop, even like you know those crystal points that you see everywhere like a clear crystal point would be super cool on a necklace or an earring and it would work with the vibe that you're doing and if you're watching the video version of this, you can see vs earrings on there. And they're really super cool. But if you're listening to the audio, you can go stalk her on Instagram and find her there and check out her jewelry but there's so I would consider like what are the things that I could do? to bump up the price point and start building my average order value, because that's going to be a lot easier than trying to sell volume of $28 pieces. All right, and you can have the lower end pieces as a compliment. But you're really going to build the order by having things higher. And I really do believe that you need to increase, especially on the things without a gemstone, you're gonna have to mark up probably 2.5 from or even three times your cost of goods. Alright, sale, plus commission. But once again, this is all something that has to be tested. And you won't know until you get it on the market. So my friend reprise his book, he talks about this case study from Tim Calkins, from the Kellogg School of Management, I read that and I was like, I have to use the same case study for my book, because it's so relevant to the industry. But basically, this guy, he did three focus groups, one of them was, and they were all for this pair of 18 karat earrings. So the first group is like this is from an independent designer, like someone who's just making the pieces, you know, and selling them, what would you pay for it? They said, $571, and it might get a little bit off on the amount that people would pay. The second focus group he brought them and these are from Tiffany and Company, how much would you pay for it? $879 or 578 70? Something? You get the picture? The third group, these are from Walmart. They said $87. So do focus group like what would you like, ask your friends like, you know, what would you pay for? These are not maybe not your friends? Ideally, people you don't know, but that are your target market. And just ask and see what they're valued at. Or when you're walking down the street sometime. And someone says, Oh, I like those earrings, and you start having conversation about them. And you're like, how much are they and you're like, $48. See what they say?

That is a big, I know the whole pricing thing. I was just going back over the pricing module. And it definitely is a head game, perceived value and charging what we're worth.

Yeah, but I think if you were to incorporate some crystal gemstones or something like that, things that and it could be just rough, that like rough points and stuff like that, I think could just that doesn't have that as what I envisioned sort of being some anything like super expensive quality, even they're like if that added like a couple bucks to your cost, it's not going to it's going to elevate the value so much of the piece, because it's a gemstone, right. So that's the first thing is just really getting the average order price point up and increasing the prices of your work because I talked about this case study on the pricing and positioning workshop that I did a couple of weeks ago. And as we're recording this, and the case study use was Wendy Hively. She, when she first came to flourish and thrive years and years ago, probably eight years ago, she went through our pricing module for laying the foundation or we also had maybe it was multiply your profits because we had a pricing module for there too, which is a program we don't offer anymore. And she went through it and she installed the formula and increased her prices and her profits went up by 30%. And her sales grew too because of that. But the sales number grew but she didn't have to necessarily sell more, she was making more money. And it didn't, the pricing increase did not affect her product at all. And I want you to look at her brand, Charlie Madison originals, because it's affordable. And it's just gemstone bracelets with oil, diffusers. She has a great desire sharing proposition she's positioned really well. And she knows exactly who our audience is, which is our military families. And building a side hustle. She has a six figure business now. So I'm calling it a side business. It's a full time it's a business, legitimate business, but she's making six figures a year. So if she can do it, anyone can do it. Because it's like what she's doing isn't I love Wendy and I'm when he's listening to this, this is not an insult. But what she's doing isn't a super original idea. It's just that she's positioned herself in a way that she can command a higher price. And your work you know that laser cutting is all intricate. The other thing that I you might consider too is are there things that you can do to get into additional categories. Like, for instance, I got snow snowflake, you mentioned the snowflake earlier and this reminded me of Christmas ornaments. Like could you sell Christmas ornaments or leather like a bag tags or things that other would type of things where you could really approach a gifting audience? Are there places where you could get positioned or partner with something like box Fox, or Birchbox or one of these gifting box services where one of your items could be positioned inside of the box So in because of the price point, it would make sense because it's not super high. So this is an option for you, it'd be harder for someone with higher price point jewelry, because they they're trying to keep the gift boxes around, like Max $150. But we buy it from box box all the time for people and their gift boxes start at like 25 to 50 for like just the simple ones. So there, there are opportunities there. And a lot of times those gifting companies, they sell volume, because they have done a lot of they have a lot of investment in SEO and marketing and stuff like that, and that investors in the beginning, so they can, once you kind of get positioned out there and your products are part of their assortment, it could help. So I feel I feel like we've kind of dialed in the product piece of this, I want to talk about some of the other stuff, because you're overwhelmed with all the things you have to do. Now,

people have heard me say this, I'm not the one who came up with this word. But it's important to work on your business instead of in your business. And when you're first starting out, a lot of people spend most of their time doing just the making and not focusing on the marketing piece. And I don't think that that's you. But this comes from a book called The E Myth revisited. And it's a really important concept because people start businesses, because they have a skill, and they're good at it. Then they start growing their business and they realize, oh, shoot, like now I've created a job for myself. This is not the reason why I started this business. And it's painful. And so they end up growing, they're hiring a team and all this stuff. But then at a certain point, the expenses get to a place where they can't afford to keep the team so they scale back. And then they're back sort of where they were in the beginning, but just more exhausted, and like frustrated. So it'd be really important for you right now you're very early on in this full time thing for you and your husband, who's your partner to really think like how can I turn this into something that's turnkey? And what I mean by that, it's not necessarily that you're going to sell it, or do anything like that. But more along the lines of like, How can I optimize the inside of my business in a way that allows us to move a lot faster. So I have a feeling there's probably a huge opportunity with the way you're producing a product, which we already spoke about earlier. I think with the marketing and sales aspect, like you need to probably get into a better system, meaning that you're batching content you're thinking through like what you're going to be marketing for the month, and how you're going to be doing all that work, like what are your key focuses, you have like goals or in traction, they call it rocks for every quarter that you're focused on, and you're working towards a goal, by the end of the quarter, even if you don't hit it, you need to be focusing your energy on what you're trying to achieve, instead of scattering your energy just willy nilly, and trying to get a bunch of stuff done. And then it's the end of the quarter and you're feeling frustrated. So I start to get a little bit of focus on like what needs to happen for the next steps. And I know this is this is a lot this is not like a 30 minute coaching call, because it's like probably a year full of full of consulting, quite frankly, but true. Or working in a coaching program or something like that. But it's really about setting the structure up from where you are now so that when people come in, they're easy to hire, so that you could outsource parts of the business potentially, and all these other things. Because also, as I'm just going to skip back to this production piece, perhaps there's an opportunity for you guys to start find a manufacturer who could laser cut the production part of it. So it's not that you get out of the initial like the fun part of the designing. It's just like once you kind of have it dialed in, you're getting orders, someone else can do the labor of it. So that's something that you might want to think about. And it's a smart move. A lot of people don't want to do it, but it's a smart move because it opens up your capacity so much higher. And that's

interesting, too, because I think that because we have the laser in our workshop that's just assumed that that's work that we'll do.

Like when I think that's a good thing to outsource of anything.

Yeah, yeah. Because like, you know, I think about outsourcing social media or outsourcing more like marketing. But it hasn't even occurred to me or to us to outsource that side. But you're absolutely right, because it does require somebody standing at the laser.

Yeah, why don't you? What about someone else standing at the laser or you guys just designing it? Right? Right. You could also hire someone to do it for you. But I personally think it would be better to find someone who can manufacture it for you. And I know that there are places out there because I've even in my business group, there's a ton of we get a bunch of swag of wood products and so I doubt that the person in that business group, because there's a requirement you have to have a seven figure company at a minimum to even get in. And these guys are doing volumes I doubt that there's one person just sitting there, standing by the laser or laser cutting it like, I know that there's options out there. Absolutely. The other thing I would do is really get clear on the responsibilities between you and your husband, who is the visionary and driving the ideas. And then who is the operator or the integrator, as they call it, rocket fuel. And maybe that's him, maybe it's neither of you, I don't know, and clarify what you are doing in the business by role. So I think the more clear cut your responsibilities are, it's going to be a lot easier to focus on those responsibilities. And I would make the marketing a priority. You know, I've been reading a lot on Instagram right now that a lot of these Instagram coaches are saying that two meals a day and want like, a couple of static posts a week, and other types of content. And there are some people out there who are doing such awesome things with reels to get the word out there. And I feel like you have a huge opportunity with that. I haven't, I'm not looking at your Instagram right now. But you have a huge opportunity with that, because I think that the kind of stuff you do, especially if you create, like show the process and stuff like that could go viral really quickly. And because the price point so low that results in sales, it's a little bit different. I mean, it's like $50, to someone isn't a big deal. But $5,000 for, you know, a ring, like I make is a much bigger deal. So for like even $200 is a much bigger deal for people. So like you have an opportunity now the window is going to shut pretty soon. So I would lean into some of those things from your marketing that would potentially create a big impact for growth.

I can do that I ride this line about Instagram and social media. That is, on one hand, I'm grateful for the amazing free platform that they give us. And on the other hand, I don't want to do it every day.

You have to, I have to Yeah, but the other thing is, is you don't have to do it all every day, you could batch it, and then have it ready just in post it. Right? Absolutely. You could do it one day a week, have it already. And post it absolutely have to be in real time. And this is where people get hung up because they're I mean, even myself, like we're behind right now on social media. And I'm, every day I'm like, shoot, I need to post a reel today. So, okay, Tracy, what really you're gonna do? What's the idea? What do you guys, you know, what's the focus of the business right now? Yeah, it's funny to me, because, like, I teach this stuff, and it's still easy to get behind. No, sometimes, and so like, the more that you can, but if you're really good at being disciplined, it's not that hard. And the reason we're like this is because I'm training a new director of marketing, and she's fantastic. But I have to teach her that, like how I need to be served the content plan to get in advance, and she's still in the phases of like building out the plan. So it's like, that's part of the reason why that's happening for me. So if you can create that structure for yourself, then it's gonna change a lot in age. Right? That makes sense. It

No, it totally does. What I've been kind of working on with my husband is trying to bring him in, you know, I've been doing the business from myself for four years. So the systems that I had in place, although they certainly weren't the best systems, it was the way that I was doing things. And so now I've got somebody coming in who I have to show him share with him how I've been doing things. And of course, the documented know that we're building documentation. Yeah, yeah, that's one of our things that we're doing. But it has, it's been sticky. It's been sticky for sure. Trying to get myself out of my own way. And don't understand it. He's a

common common. So my Nan, I am the worst bottleneck in my business. The visionary always is, it's the truth. It's not just me. Know, the visionary is always the biggest bottleneck. You know why? Because they're most passionate, and they care the most. And it's usually their idea, that kind of brought the thing to life. And they like to metal. So we have a rule. Tracy's no longer allowed to lead meetings. And I am super grateful for it. I shouldn't be leading meetings. And I've been telling people on my team this for a long time, but they're like you own the company. And I'm like, I shouldn't be leading meetings because it's destructive. And I'm sure there are visionaries out there who are great at leading meetings do I think most of them like it? No, I doubt it. And they're not fun. And so in the beginning, you have to do it but like as your business grows, these are things that the creative type, slash visionary type slash idea person should be removed from, they should be a contributor and a collaborator instead of the leader of that, because leadership is really about really more about inspiration, and showing the direction not managing There are two different things.

I have just a funny story about being our own bottleneck and about what we hear, as opposed to what people are actually saying to us. So I make these ornaments, we make these ornaments. And a couple of years ago, my husband makes ornaments. We do I do ornaments. Yeah. My husband was saying to me, you know, I'll make a jig for you so that you can make them faster. So I don't know if everybody's familiar with what a jig is. But you know, it's something that makes our work production more repeatable. But when he would say the word jig to me, I would get so triggered. And I would think he was he thinks I'm not doing it perfect. He thinks the product isn't good enough. He thinks all these things. That's what I was hearing as opposed to really he wanted. No, that wasn't it at all. He wants to help speed up production. He wants to make this more repeatable. So again, they're standing in my own way. Yep. And thinking that it's some kind of reflection on my creative process, which it absolutely is not.

It is not, no. Okay, awesome. So I feel like we covered a lot here and about 30 minutes.

Has it been 30 minutes? Yeah.

But wait, I have so many more questions. Live, I'll have you back on, I just, I want to get really clear, because I know that you're really coming in here. And you need to for extra sales in order to like really make the business work for you. I think the first place to start, in my opinion is to take a look at your costing structure, and dig deep into the numbers because the numbers don't lie. And they give you a lot of information, what needs to shift? And how can we get our average price point up from a direct to consumer perspective? And how can we get our average price point up from a retail perspective. And it might mean that your wholesale or excuse me a wholesale prospective might mean that when you're selling wholesale, you have a higher minimum of like 24 units. And it might also mean that at retail, you consider how you can bundle things together or increase that retail price point so that your, for each sale, you're making more money. That's my first thing to you. The second thing is really taking a look at your production process, which is what we let you just covered and how can you speed it up and optimize that because if someone is required to stand there with a laser, and it's super labor intensive, then maybe the labor intensive work should be outsourced to a production facility that has it dialed in a little bit more where you can buy pieces for, you know, per unit, and it might in the short term just cost you a little bit more, but it's going to speed up what you can do, and you guys can focus on the things are actually going to move the needle more in your business, then the next thing I would say is to get really clear on what your roles you and your husband are and reverse engineer like what needs to happen in order for that for X to happen by developing quarterly plans to support your financial goal. So if you were to reverse engineer it and create a sales projection, how many wholesale accounts do you need to get? How many direct to consumer sales? And at least like, even if you don't hit it, at least, you know, and then you can have something like, okay, we're making some progress. But like, here's where we need to be for the next Avenue. And then I would just, you know, you know my thing, like, just do the mindset work, to keep yourself focused, and start documenting what you're doing and your way of doing things because it's gonna help as you start to grow and want to hire people to bring more on or be able to bring people on and get things out of your head because it's not really a system if it's just your way of doing things that's in your head. It needs to be documented.

Yes, yes. No, I

don't think it's we all know that way too. Well. Yeah. Yeah.

It's just the way I do things. Yep.

Awesome. All right. Thank you so much, Marissa, for being on the show today. You're awesome.

Thank you. You're awesome. Thank you for this program and for the guidance. I mean, I think if anything, if anything, what LTF has really done for me is build confidence.

I love hearing that. Yeah, because I'd love to have you on another another time to talk a little bit more about your experience in laying the foundation.

I would love that.

Awesome. Thanks for being here.

Thank you, Tracy.

Thank you so much for watching the show today and I am honored to be here. If you haven't done so yet. Make sure that you pick up my best selling book the desire brand effects stand out in a saturated market with a timeless jewelry brand. You can buy it on Amazon or head on over to designer brand effect.com today and pick it up right over there.