Pulling The Plug

I’m finally closing the book on the 2nd Bottled Water Experiment where I attempted to get a homeless guy to sell water on Riverside Drive while I was off doing other things.

I can make all the Excel charts I want showing how much profit should be made etc, but it just didn’t work out like that in real life.

I’ve learned a few things from this experience:

  • Working with a homeless guy proved a bit difficult due to a lack of communication, which is much needed for coordinating.
  • Ice proved to be the most expensive, yet shortest lasting commodity.
  • You need A LOT of ice to keep 100+ bottles of water cold in 103 degree weather. Dry ice would probably be better.
  • The amount of work required to pull this off was not worth the money. There were a lot more logistical problems than I first imagined.

The 1st Bottled Water Experiment showed that selling water by yourself can easily bring in a healthy profit, but delegating the work in this case did not.

Since the 1st and 2nd water experiments, I’ve setup Barry with water about 7 times. There are lots of problems which arise, especially schedule conflicts and weather. Weekdays are also surprisingly slow days for selling water, even if it’s hot. Tougher vagrancy laws now in effect also hamper the selling.

Funny thing is, whenever I approach a homeless person to see if they’re interested in selling bottled water, they ALL smile and say, “Ohh…so YOU’RE the bottled water guy!”
I’ve become a quasi-celebrity in the Austin homeless community!

Since this never materialized into a real money-maker, I see no need to further pursue it. I strongly believe it CAN be a money-maker, but with my ever-changing schedule and mounting work load, it’s not for me. At least I learned something new!

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    Blog posted on: August 8, 2005

    18 comments on “Pulling The Plug

    1. The Dividend Guy

      Good call…I think a good entrepreneur is highlighted in their ability to shut down when the numbers and model do not work. No use trying to force it…

      TheDividendGuy

      Reply
    2. Julie

      Nev! I made my two kids read the bottled water posts, and they are going to try the same experiment in our hometown. It’s better than having them sit around all summer!
      Your blog is a real inspiration, keep it up!

      Reply
    3. Jose Anes

      What I can conclude from your experiments is:
      1) Homeless people can make money on their own if they organize themselves to sell water – or anything else for that matter.
      2) You need a higher margin product to make a business profitable for two people (where one of them – the homeless – do most of the work). Just like companies: you have to be sure that by adding an extra employee you do not eat into the profit margin so much that it is not profitable any more.

      Good learning.

      Money and Investing

      Reply
    4. Yang

      Too bad things didn’t work out, but you definitely did a good deed. Barry was probably able to get a few square meals and a newfound respect for himself. Plus, the Houston homeless community was no doubt inspired to get up and do something about their situation instead of sitting around feeling sorry for themselves.

      Reply
    5. Marv

      I agree with Yang, you did something priceless for Barry! For that congratulations! btw, I am also like the others, inspired by your wb experiment!

      Reply
    6. FMF

      As with many things in business, it all comes down to people. If you can’t communicate with them, trust them (to be on time, etc.), and motivate them, it’s all for naught.

      Maybe the plan would work with a more responsible person as your employee?

      Reply
    7. savvy saver

      Thanks for sharing this with us, Nev. Part of being a good business person is knowing when to take your lessons learned and move onto something else.

      keep it up!
      erin
      Savvy Saver

      Reply
    8. Anonymous

      Nev,

      Glad the blog is back.

      Although I’ve had the opportunity to personally participate in a couple of posts, the BW experiment is my favorite thus far.

      Great work exploring some of the most common challenges that occur in business every day.

      You are doing yourself a huge favor learning those lessons at the $100′s level rather than at the 6 or 7 figure level, but I have no doubt you will get an opportunity to do that as well.

      Vinny

      Reply
    9. Dan

      Can you explain to me the schedule conflicts you had with Barry?? Was he too busy having lunch with the mayor? Organizing a homeless ball? But I do agree…it’s probably not going to be a long-term money maker. Good idea though.

      Reply
    10. Neville

      Vinny,

      Always good to hear from you. As usual, I’m sure business is going very well for you!

      Very true about learning lessons early. Even if I get completely cleaned out this year from a bad investment or anything else, I am still young and have no one to support. I’d much rather screw up now than later.

      Luckily I have people like you who have been there and back to ask advice from.

      It’s hard to top that bottled water experiment, but I’m always looking for new ones to perform!

      Dan,
      Barry’s schedule conflicts usually involved him having to appear in court for various violations. The police in Austin are getting stricter on vagrants, and can basically give them citations for just about anything.

      He once couldn’t make it because he had to attend an all day anger management course….the story behind it was actually quite funny, but that’s his business!

      -Nev

      Reply
    11. Wealthy Web

      I just ran across your blog, and I am so impressed. I’m 30 now and behind where you are. I am looking forward to getting to your point and beyond. Wow! You’ve got guts! Keep it up:-)

      Reply
    12. Mason

      I still can’t believe you pulled that water experiment off, Nev. It takes a lot of guts to do something like that, AND you were constantly snapping pics throughout the duration of your venture, hilarious!

      DON’T LISTEN TO ANYONE telling you how you COULD have made money Nev. You were the ONLY one here who did the experiment, so until someone else performs it, they have no real say in it.

      I love you blog. It’s a real inspiration.

      Reply
    13. Anonymous

      Experimenting is a great idea. However…..
      Well-defined experiment should answer well-defined questions. Preferrably not questions that could have been answered beforehand.
      Unless a homeless fella has a cell phone, a college level educated person should expect that “communication would be difficult”. “Ice melts fast at 103 degrees Farenheit”, I hope that most high school kids would be able to answer that. “Ice is expensive”…duuuuah
      While I trully enjoyed “the bottled-water” write ups for their entertainment value, I would not consider this “a college-level experiment” and as one providing any new, useful and/or valuable information from experimental or business point of view. Unless, of course one considers “fame among the homeless” valuable. Kuddos for the entertainment & production value though.

      Reply
    14. sue

      That’s hilarious, what a great idea. Always thought people could make a killing selling old water and hot days.

      Reply
    15. Anonymous

      You are on the right path. I’m reminded of a quote:

      “The only man who never makes a mistake is the one who never does anything.” -Theodore Roosevelt

      Reply
    16. Anderson

      At first I thought the way you bolded certain lines was annoying and pretentious. But after reading for while on Bloglines, its very effective. Its just damn easy to read! Best wishes on all your ventures, Eric Anderson

      Reply

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