What helped me rise out of my downward spiral in 2012 was reading the E-Myth Revisited by Michael Gerber. It felt like it was written just for me, and it gave me specific tools for how to move forward. Another book found its way to me this year, and is acting as my guide for the next stage of my entrepreneurial journey. Well not really a book so much as an author: Seth Godin.
2015 wasn’t the first time I felt like my business was falling apart. It also happened in 2012.
The disaster of 2012 actually began in 2011. Newly split from my co-founder, I was excited to take over the reigns of the business and really start growing it as I had always envisioned. I moved production overseas to make the product more viable in the marketplace, and, for the first time ever, got large orders from nationwide stores like REI and Title Nine. When I did my revenue forecasts, 2012 looked like it was going to be the first year when I could pay myself, plus another person or two, plus get our own studio space. It’s hard to express how meaningful that felt after slogging away without anything for 3 years.
It all started to fall apart when the product from our new manufacturer showed up months late. I didn’t want to upset our new customers by not being able to ship on time, so I produced product locally, which demolished the profit I was planning on making. Then, not all of the products that showed up were up to our standards, so I took a loss on those too. Then, the bags that we did ship didn’t sell as well as the stores had thought they would, and they canceled their future orders.
This left me deep in the red and with a lot of inventory that I didn’t know what to do with. All I could think about was, “Who can I sell this stuff to??”. I didn’t care who bought it, I just needed to sell it.
My wake-up call was when I was talking to my business coach and she asked me who I thought my customer was. “I don’t even know!” I wailed.
In my design agency days, “Know your customer” was my mantra. I did user research and built customer personas all day long. And here I was, with my own business, not even knowing who my (true) customer was. My customer was anyone who would buy bags so that I could live another day.
I survived that year, and became stronger, or at least more resilient. (Hear a podcast interview with me about this whole episode on Fashion Brain Academy). It took awhile to recover and get everything back in order. In 2013 and 2014, we started doing a lot more consumer facing events, and I got to meet my customer in person. We did a big research project in 2014, which helped me get to know her even better. But, knowing your customer isn’t quite enough to have a successful business. You also have to have a vision for your company, and know why it is doing what it is doing.
I always thought I had a vision. It was this: “Po Campo to be the go-to brand for urban minded individuals who seek to make every day a day worth living”. I guess that’s kind of a vision. But it doesn’t give you the “why”. Why do I want this? And why does my customer care?
So that’s what I’m working on now. I started Po Campo from a very genuine place. I wanted to make these bike bags because I knew they would help people bike more to get around, which is something I care about deeply. I don’t feel like I need to fabricate a “why”. I just need to articulate it, and embrace it.
Yes, it has been about a year since I last posted and oh man, has so much happened. I didn’t feel like writing while in the midst of so much change, but now that I am back on somewhat sure footing again, I wanted to share what I’ve been up to.
Last year at about this time, I decided to make some big changes at Po Campo. Basically, I decided to cease doing business as usual. That decision was the culmination of many sleepless nights that led me to realize that how I was leading Po Campo was just not working.
- Our products were selling too slowly. We had too much money tied up in inventory, killing us cash flow-wise. Also, why weren’t our products selling better?
- We continued to have manufacturing problems. After many conversations with our manufacturer, it became clear to me that they were not the right partner for us, but I had no alternative.
- The team was getting tired. Sales growth had slowed and nobody was being paid nearly what they were worth, despite years of hard work. Including myself.
- Customers were asking for new products, but we already had too much inventory, no money to make new products, and not enough energy to develop them.
Here is a situation that we have all been in, which will help you relate to why I decided to change course: You are discussing a problem with a longterm romantic partner, and before you know it, that conversation about a small problem quickly escalates to why you need to break up. It makes you sick to think about it, but in your heart of hearts, you know it is the right thing to do. That is how the decision to “break-up” with the existing incarnation of Po Campo felt to me.
And like in those conversations with a partner, you might try to patch the problems first before cutting the cord completely. I did that last spring with Po Campo too. We launched a new mobile-friendly, keyword-optimized website to improve our online sales. We started partnering with bicycle advocacy groups to build brand awareness among their supporters, who I felt understood the intent of Po Campo the best. Regretfully, both of these last pushes fell flat. Our traffic and conversion rate with the new website actually decreased, and the nonprofit partnerships did not yield much traction either.
I had funded the company with my own savings and through debt (loans). We were out of money again, but I didn’t want to borrow any more. It felt like I was just going to be throwing good money after bad. With no new money, my only option was to dramatically cut expenses. So that’s when the break-up really happened.
I let go of my team and sublet our studio space, which cut about 60% of the expenses off the bat. As part of my mission to make Po Campo the “right size”, I liquidated all the slow-moving inventory. Going from a 3 person team to a 1 person company meant I had to relearn a lot of the business, and decide what to keep doing myself, what to cease doing, and what to outsource. Figuring all that out occupied me for many months, plus I wanted to set some time aside for soul searching about to do next, and to work on some long standing problems.
During this tumultuous time, my loving father past away and an opportunity arose for my husband and I to move to NYC. I was in a daze and kind of wanted to give myself a fresh start, so we decided to take the leap and move. Changing your surroundings does make you look at everything anew, which I needed, so I’m glad we did this.
Looking back, for all the stress and trauma over the last 12 months, I feel like I came out ahead. We have a new manufacturer who I really enjoy working with, and the products are so much better! Finally the quality and craftsmanship matches my vision, and it only took me six years (and hundreds of thousands of dollars) to get there. Eeesh. I also redesigned our flagship bike bags to correct some of the longstanding problems with them, and can’t wait to launch them this month. I don’t know if they’ll move the needle too dramatically sales-wise, but at least I feel completely proud of them.
Po Campo 1.0 is now living more-or-less within its means. I’m getting by as a solo entrepreneur. I don’t enjoy it as much as when I had a team, and our own office, but this is what a company of our size needs to look like.
I’m also working on Po Campo 2.0. I love dreaming big, and have big aspirations for the company and brand. I have a plan for what I want to do differently this second time around. Or, what to do differently to build on what I’ve already accomplished.
While 2015 was definitely a tough year, after all that soul searching, I know I want to continue this journey because I still believe 100% in the brand and the product concept. It’s not done yet, and I want to see it through.
So that’s where I’ve been, and what I’ve been dealing with. Back to the regularly scheduled content next week!