Archive for category Uncategorized
No posts in a long time. We are still around and still alive.
New Websites Launched.
2 New Entrepreneurial Projects.
There has been a ton going on. I need to get you caught up!
Here at ScrubSquared we have a very small office. It is approximately 300 square feet that is broken up into two separate rooms. Despite the size, on average there are 3 people working in the office. We tend to all sit at one big table together in our front room. When someone needs to have a serious phone conversation they go to the other room and sit at a semi-private desk. Needless to say there is not a ton of privacy. In general I love the set up, it encourages all kinds of interaction between everyone in the company.
However, there are obviously times when private conversations need to happen. To make this happen, we recently implemented a “walking” strategy. Let me explain with an example. We recently had 1 on 1 feedback sessions with all of our employees. Rather than the “corporate” standard of sitting across from eachother at a desk we took a stroll around the block that our office is on.
It was great!
First of all, on a nice day in Minneapolis it is great to get outside while the getting is good (when it snows up here we may have to bring the walks to the skyway). Secondly, I think it helps break down some of the walls a normal session may have allowing both sides to be more open with feelings, feedback, and thoughts. There is something about walking and talking eye to eye as opposed to across a desk that made the conversations some of the best feedback sessions I have ever had. It worked so well that it is now going to be a policy. Even when we move into a larger space, with more privacy, we will take a lot of our important 1 on 1 talks outside for a stroll.
Give is a shot, see if it works for you.
So I know you have all been waiting at the edge of your chair for the conclusion of my last story.
Our first big manufacturer to sign up was Landau Medical Uniforms. I went through the normal channels and steps you have to take to speak with a sales rep including sending in all my application forms and credit forms etc. However, I didn’t have any strong credit references in the uniform industry, which is what they specifically asked for. I used my banker, lawyer, and a screen printing shop I had done some business with and that was all. On top of it I was forming as a drop ship outfit so they knew there would not be a large up-front order for me to get my inventory up (this would prove to be and still is an ongoing issue to sign up new suppliers, as no one really wants to sign up more drop shipment only retailers).
After a week or so I received a call from the head of sales at Landau, which I imagine is a little unusual. He started asking me questions about our business model etc. It then came out that he was a UVA graduate, At the time I was still a student at Darden (UVA’s MBA School) which is why he called me personally. We hit it off and talked about the school a bit. After the conversation he approved our account. He never said that was the reason he gave us a chance, but I am pretty sure it is strongly correlated.
Once we signed up Landau (who also owns the Urbane Scrubs brand) I moved on to Dickies Medical Scrubs. I was able to use my new-found Landau agreement to help convince the Dickies people they should let me sell their product. It was still a tough sell but since I had one of their major competitors on board it was much easier to convince them.
Finally, I re-approached Cherokee Scrubs (who had initially told me I had no chance at signing them up). They saw that I was selling the scrubs of their two biggest competitors and realized that they were probably losing business.
Signing up these suppliers was a ton of work and a huge sales job all on its own. Today, I am starting to get fed up with the operational lackings of one of our smaller manufacturers…which I will talk about in my next post!
Until then (it wont be as long a wait as the last time!)
I know this has been a little while coming but I think I am finally at the point where I have a little time to write more frequent posts. Before, I start part 2 of merchant services, I would like to mention that we have added some add’s to the blog so if you see anything you like please feel free to click through and help support the us.
OK, on to merchant services. In my last post on this topic I spoke about the steps it takes to set up an account and what the value chain of the industry looks like. This post is specifically about fees. Everyone who accepts credit cards hast to pay something (even Target and Walmart) but you can do several things to help minimize your costs, even as a start-up. How do I know this? I know because A) I used to sell merchant services and B) I just went through the process of setting them up. Here are a few steps to take to minimize your costs:
- First understand your busienss. Specifially, what will your typical ticket size be Vs. how many tickets a day will you process. This element is key because every merchant processor is going to charge you in two ways; 1st a per swipe transaction and 2nd a % of the total bill. They dont advertise this, but merchant processors are willing to negotiate prices on both of these cost elements (i.e. charge a smaller per swipe for a higher % and vice versa). This is why it is important to know your business. If you do very few swipes but have large ticket sizes you are better off with a low percentage and a higher per swipe charge. If your company does a lot of volume with small ticket sizes then you would want a little higher percentage with a lower per swipe (scrubadoo.com for example). The better the idea of what your transaction size and volume will be the more optimal your fee structure can be.
- Ignoring their publicly advertised pricing, look for a few processors that you are comfortable working with. Research the company, how they do business, even ask for client references (people you can actually call). Just like every other part of your business do your due dillagence on your merchant provider.
- Once you have identified your top two or three choices for providers contact them and ask them for a quote. Make sure you tell them what you are looking for in pricing (remember you know your business better than they do and they can taylor thier quotes to what you specify i.e. small per item and high %). It is also important to take into account the equipment you will need. If you are an e-commerce site you will need none. But if you have a brick and mortar shop you will need processing equipment. The newest wireless technology can be close to $1,000 for one machine. It is important not to ignore this aspect of pricing. Once you have the quotes in hand you hold the power in the relationship. You have choices and all of the processors want your business.
- Again, ignoring pricing, decide which processor is your top choice. If your top choice also has the best pricing you are done (although it never hurts to tell them you are looking at other companies to see if they will throw in free equipment etc). If they are not the lowest, tell them. They will likely ask for any lower quote in writing. Give it to them. Most companies will at the very least match competing offers, more than likely they will actually beat competing offers.
- Now you have your preferred vendor at the best pricing you could have hoped for.
- Re-visit your account at the very least annually, see if your pricing is still ideal for your company. As you grow don’t be afraid to renegotiate. The bigger you are the more valuable you are to your processor.
That is my breakdown on merchant services pricing. We are currently using Authorize.net as our gateway and BB&T for our processing. If you are in a region where you can use BB&T give them a shot. They are very good at both service and pricing.
I didn’t write yesterday, so I’m going to write two posts today. First, I am happy to report that we have revenue! This past week, Brett and I sold Darden-branded scrub pants in the hallways. We sold 115 pairs! Much better than I expected. Plus, we got great feedback on the product, and everyone’s telling us they have nursing friends. Our mailing list is growing. Brett also convinced the bookstore to carry some and has already made a first sale for Scrubraisers – 75 UVA-branded scrub pants for the nursing school to sell to their incoming freshmen. I think the popularity of the Darden scrubs is also a good sign for alternative markets like sororities and other non-health related organizations. Things are really rollin’!