Monthly Archives: April 2008

What It Costs To Be Alive

I don’t know where this came from, but I was randomly curious on how much it costs me to simply exist here in Austin, TX. per year.

Fixed Yearly Costs:
$1,000 = Car insurance ($84/month)
$1,800 = Health insurance ($150/month)
$960 = Cell phone ($80/month)
$6,000 = Rent ($500/month)
$12,000 = Food, gas, general items ($1,000/month)
$2,400 = Random Costs ($200/month)

Total = $24,160

That’s just to live, doesn’t even account for going out, travelling etc.
I also have few monthly bills because I have no debt, no loans and no car payment.

Hmmm….good to know.

Upgrading HoR – Day 14

Today for updating HoR I added a few more products to the site to various sections, nothing particularly crazy but a necessary step in the improvement process.

I also took advantage of a feature in the recent upgrade of Shopsite: Google Sitemaps. The new software automatically populates a sitemap specially designed for Google and submits it via the Google Webmaster Tools.

On another note, a very small change that has been particularly helpful lately has been the percentages metric I added to my accounting sheet. Little did I realize how many of my products had a much older version of the shipping metric on them.

It becomes especially apparent on large orders where my percentage should be 30+ percent. Before I would get a large order, and after the numbers were entered, a nice profit sum would be spit out. This profit seems nice until you realize it should be nearly a third higher. What a big difference such a small metric can make!

Improving HoR – Day 13

I did the $325 upgrade for my shopping cart software, and I am proud to announce something:

It was the first installation of new server software in the history of mankind where nothing went wrong.

On another not I got the 4th of July section relatively done, populated and have put up a small denotation for it in the left navigation bar:

I’ve also got the Froogle feed setup…another thanks to Adam’s post about this. It went pretty smoothly thanks to an automatic Google Base submit feature in the newest version of Shopsite I just upgraded to.

Improving HoR – Day 12 – Percentages

When I get an order for HouseOfRave there are two numbers I plugin to get my profit count for the day: the amount of money brought in by the order and the cost I pay the supplier to send it.

It’s a very rudimentary calculation of IncomeCost. With this system some orders would have a high profit, some would be low. Sometimes an order would make me $25 another order of similar value would make me $5. This shouldn’t be the case.

When an order goes way below my margin rate, that means something is funky on my end. So to more obviously identify what is going on, I added a simple income/profit percentage rate calculation. Now with this simple percentage I can more easily pinpoint problematic orders and fix them immediately.

Check it out:

That first problem order was for $49.25, yet I only made $2.33 in profit….less than a 5% margin, yikes! However, orders of roughly similar value bring in at least $12 or more.

So now I can see something is wrong and fix it. With that particular order, the person ordered with 3-day shipping, and my formula for 3-day shipping on the products they ordered was wrong. Easily fixable.

That order isn’t the only problem, in fact almost every order has some small issue. Every order should have a margin percentage rate at or above roughly 30%.

So this set of shown orders brought in $1,168.02 and profited $274.38 for a profit margin rate of roughly 23%. If there were no problems with my shipping table and all prices matched the supplier, then this set of orders would have brought in about $350 instead.

One of the real culprits here is the shipping prices. My software can’t do the same type of calculations as my supplier, so they are always a little off. Hopefully the upgrade can help solve this issue soon.

One of Bob’s Rules really is true:
Anything that is measured and watched, improves.

Improving HoR – Day 11 – Cart Upgrade

Today for HoR I further populated the 4th of July Section which I want ready by month’s end, however the most important thing today is I bought a $325 upgrade for Shopsite, the server-side software I use for HouseOfRave.

A few of the goals I previously set out that will be now be possible with this upgrade are:

  • Upselling commonly bought items at checkout.
  • Integration with Google Analytics.
  • Automatic Google Base XML feed submission (thanks to Adam’s post for jump starting this idea).
  • Free shipping coupons.
  • Analyzation of in-store keyword searches.

There’s a couple more features the upgrade has, but the main ones I bought it for is the checkout screen upsell feature and auto Google Base XML submission.

In the coming days I install it, I’m sure there will be a little learning time for the new features, plus maybe a problem or two. Murphy’s Law ya know!

Improving HoR – Day 10 – Seasonal Stuff

I spoke about getting seasonal a few days ago, so to take some action on that I’ve created the HouseOfRave 4th of July section

This section is the second to be added under my recently created “Seasonal” section. I’ve started populating the section with new products my supplier carries, I’ll add 5 or 10 products per day. A lot of the existing products I carry also go in this section, so it shouldn’t take very long to populate it.

So for today I made the 4th of July section, added some products, created the banner and added it to the seasonal section.

Improving HoR – Day 9 – Tattoo Experiment 2

A while back I did a business in a box inventory experiment. It’s been almost a year now, and even on a small scale I realize that I really don’t like maintaining an inventory, and especially don’t like physically sending out orders.

This is why HouseOfRave has always continued to be a dropship model.

Since I’ve done this little experiment in selling the tattoos I’ve had to re-order inventory twice, buy more packing supplies (aka envelopes and stamps) and this time I ordered a little more stuff, which was perhaps a mistake, but a learning experience nonetheless.

So to keep in conrguence with the “small, lightweight, can-be-sent-in-an-envelope” theme I also ordered some of these tattoo sleeves from the supplier:


(Yes, that is my arm with the tattoo sleeve)

I did a quick photo shoot of them and made them a new product on the website. Additionally, the supplier was out of the standard 8″ tattoos I ordered before, so they sent 5 1/2″ tattoos instead which I had to make a new product for. So now on the tattoo page you can see the two new products.

For the smaller tattoos I decided not to sort them into individual products as that gets tedious to maintain inventory, but to sell them as an “assortment” which means you get random styles. I still had to photograph some of the different styles using the same method I did for the first tattoo experiment:

You can see all the final images on the 5 1/2″ tattoo page.

Every time I get an order for a temporary tattoo I:

  • Get the “business in a box” from my room (aka the Aldo shoebox)
  • Address an envelope
  • Insert the tattoos (or sleeves)
  • Send the “package” when I check my mail.

Relatively simple yes, but it still involves work which is best suited for a properly prepared supplier with a warehouse. For example, if someone wants the tattoos with Express shipping, I have no way of doing this without a trip to the post office. Fortunately this doesn’t happen often, but nevertheless I might remove these products at some point if I have to ship them myself, despite their (minor) profitability.

Improving HoR – Day 8

Improving HoR today dealt mainly with making the Glowstick section more congruent.

I changed a lot of the prices (as they have been raised), properly calculated shipping prices and calibrated all the product layouts to the new top cart. I also added some new 10″ high intensity and 10 ” Ultra high intensity glowsticks to the section.

When I tell people about HouseOfRave they usually say, “Oh, so you sell a lot of glowsticks?” It’s an understandable misconception…but in reality I don’t make much money on glowsticks. However I do make money every once in a while on the big, bulk glow orders.

Another thing I started doing today was preparing for a HouseOfRave email blast. I’ll be sending this particular blast out sometime towards the end of the month using Vertical Response. It’ll be to 4,000 emails (a group of customers who haven’t ordered in at least 6 months from the mailing list). I could send it to more, but this seems like a nice test size to run some numbers.

This will be my second email blast ever for HouseOfRave, the first one was a total disaster:

  • It looked horrible
  • It had a long load times for the images
  • If the address wasn’t capable of HTML it just showed code
  • I simply sent it using Outlook
  • I put the addresses in the “To” field instead of “BCC” field, therefore IIFFFF the email was even opened correctly, it showed 5 long pages of email addresses before the content began.

Quite embarrassing! I also (understandably) got a lot of angry people emailing me back saying, “I can’t believe you openly shared my email…” I’ve got much more experience with email marketing since then, and will hopefully send out a successful, nicely designed, customer friendly email. I’m curious to see the order impact it will have (if any).

Improving HoR – Day 7 – Getting Seasonal

As a high school then college student running HouseOfRave I never understood anything about retail.

Later in life I learned that seasons can make or break retail outlets. It’s well known that many retailers often clear half their yearly sales from November to December alone.

Luckily I’m with a supplier who’s much wiser and long understood that, and plans retail holidays months in advance. About a month ago, for the first time ever on HouseOfRave, there was a seasonal based product section. That was the St. Patrick’s Day section:

It’s kind of annoying adding so many products just for a short holiday, especially since many of them don’t tie into the “Light Up Stuff” theme of HouseOfRave….but I’ve found some other long-term value benefits to these sections:

  • It makes the site look up to date.
  • Makes the site look “bigger”
  • Holiday supplies are often good upsellers.

I realized most people ordering the St. Patty’s day stuff ordered different items first, saw the St. Patrick’s Day section then said, “Oh, that would be nice to have this weekend” and added the product.

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With that said, Spring is here, the weather is warmer (Austin weather is unbelievably beautiful right now) and people will be doing more outdoorsy stuff.

Products I carry that are congruent with this are the Bubble Section and Fans. Apparently these items do really well this season.

So for improving HoR today I added some fans to the Play Stuff section…although it doesn’t really fit there (just needed some place to stick em for the moment). I also added a couple of bubble products to the Bubble Section:

Improving HoR – Day 6 – Not So Much

I didn’t really do much to improve HoR today because I was primarily concerned with an all day doing-taxes-at-the-last-minute session. Actually it only took about 2 1/2 hours thanks to TurboTax….it made my day a WHOLE lot easier.

Ha! In the amount of time it took me to make that creepy TurboTax-love picture I probably could’ve upgraded something on HouseOfRave.