Build a Million-Dollar Side Business
Tuesday, May 18, 2010; 12:00 AM
I have always considered myself an entrepreneur; it's something you are born with, something you actually don't have a choice in. It's that unbelievable desire and passion to create something all your own, where the power, decisions, success and failures are in your hands. Even during periods of my life when I had a full-time job, I always had something that was just mine, where I held the reins.
I also grew up in a household where I was constantly reminded that being self-employed is always better than the alternative; I was told that is where the money really lies. Prior to my current company,BooginHead, I had founded a recruiting and coaching firm. Despite its moderate success, it didn't take off in the way I had hoped. Maybe it was the down economy or the fact that I was just starting a family, but I knew it was not my golden ticket. At that time, someone shared with me that some of the most successful people in this world fail several times before they reach true success, and I believe this to be true.
In 2005, I created the very first prototype of SippiGrip. I was frustrated with my 1-year-old son, Jake, who threw his sippy cup to the floor from his high chair, stroller and car seat. I was constantly picking up the cups, which were either getting dirty or getting lost. I looked everywhere for something that would fit my needs. While there were a few products on the market at that point, each one had some major flaw that rendered the it useless by my standards. I even said to myself, "If I find something that works just as well as what I have created, I will let this project go and move on to something else."
I never did, and that's how theSippiGripwas born. Now thousands of parents everywhere purchase SippiGrip from large retailers such as Babies "R" Us as well as smaller, high-end boutique stores like Kitson in Los Angeles. The SippiGrip is affordable and functional, but fashionable enough for every kind of customer.
In the beginning, the SippiGrip was made out of polypropylene (most commonly used for dog leashes) and only came in three solid colors. It was incredibly long (too long to pass any safety tests) and, at the time, it didn't have my "secret sauce," the grip material. But I hit the streets anyway to get it in front of any mom who would be willing to use it and give me her feedback. I asked mothers what they would pay for it, what to call the item and what improvements they would make. That initial feedback is what gave me the idea to use a material that allows the strap to suction to the cup or bottle. That's how I came up with the name SippiGrip, and it's what truly differentiates the SippiGrip from my competitors' products.
In early 2007 I stopped treating this as a hobby. I formed BooginHead LLC and decided to put my efforts into launching a serious business. At the time I had no experience or knowledge of the industry or even any idea of how to bring a product to market. This is where that raw entrepreneurial desire came into play. I used every resource I could find and connected with other parent inventors who had already paved the way to success. I made a lot of mistakes in the beginning and wasted a lot of money, but I learned from those mistakes and was better off because of them.
This year our company is on track to break the million-dollar mark in sales. The road was not an easy one, but there were a few key things we did early on to help move the business along and grow it so quickly:
I connected with other parent inventors. Some were already successful and others were at the same stage I was. We shared resources to gain an understanding of the industry. Some of those resources included manufacturers, trademark and patent attorneys, and general industry knowledge of how to approach retailers. Sites that I highly recommend aremominventors.comandmommymillionaire.com.Despite the fact that my product was still in the early stages, I signed on as a vendor at The ABC Kids Expo Trade Show in September 2007. This is where Target approached me to be in its 2008 Parent Invented Products Program. I also got some very honest feedback from buyers that helped improve my product long-term.Most people have the impression that trade shows are over-the-top expensive. But you can make a great impact on a small budget. Looking back, my first booth was simply embarrassing. Once I got to the show and realized what other people were doing, I was awestruck. But Target didn't seem to mind. It was more interested in the product than the fancy booth. This was a pivotal turning point for the company: Target was not only great exposure for my product, but working with a company this large was like earning an MBA in the industry. I learned how to operate with a large retailer successfully and was able to bring that knowledge and infrastructure as a selling point to new retailers.I invested in a good lawyer. There are many places to cut corners in the beginning, but a lawyer is not one of them. Trademark and patent applications can be very tricky. You'll find many "do it yourself" sites online, but one wrong word and your application can be rendered useless. It's important to have good legal counsel to do it the right way.I always listened to my customers and consistently made changes and upgrades to the product to fit customers' needs. For example, after reading some reviews online about my PaciGrip product, I realized how important it was for the PaciGrip to work with all types of pacifiers, so I changed its design. That key change has made it my best-selling product.I never gave up. There were some very discouraging times, but I stayed committed to my dream and pushed through each one successfully. For example: Less than a year ago I received a certified letter in the mail from Playtex Corp. saying that I was infringing on its trademark of the word "Binky" with my product "BinkiGrip." This is also a great example of why legal counsel is so important. Had I consulted a lawyer before moving forward with my product name, this issue would have been caught and addressed from the beginning. Instead, I scrambled not only to find a new name but also to figure out how to change the packaging for all the units that were currently in production or in transit to my distribution center. To be fair, Playtex was more than reasonable in allowing me time to do this. However, rolling out this change was a large expense and created a lot of stress. It also meant rebranding a product under its new name, PaciGrip, after that product had already begun gaining momentum in the marketplace under a different name.
How to Gain Larger DistributionAfter launching in Target stores under the Parent Invented program, I wanted to use that success to gain larger distribution. At that time, Babies "R" Us was the ultimate goal for my products. I timed my pitch to coincide with the company's "line review" and when I knew I would have strong sales numbers to show. Pitching during the line review was important because I wanted Babies "R" Us to be open to looking at a new product. I approached the buyer by describing the success we had in a competing store and explaining what I could do for its stores. Using my established infrastructure as a selling point, I also demonstrated that my product was "plug and play." If Babies "R" Us took me on, it would not have to teach me the ropes of operating with a large retailer. I used this same approach with other retailers and had a strong response.
By the time I returned to The ABC Kids Expo in 2008, the BooginHead brand had seen incredible growth in the United States with Target, Babies "R" Us, BuyBuyBaby and Amazon.com.
It had become clear to me from watching my competitors that international distribution was the next step. This can be a daunting task without an understanding of how the retail business operates in other countries. I learned through relationships I had formed at the trade show that working with international distributors was the best route into foreign markets. These distributors often attend the trade shows and will approach you directly to work with them. But before you go down that road, there are a few important things to know:
Distributor pricing: International distributors buy in bulk and sometimes directly from where you have the products manufactured--so you have to provide discounted pricing to make it profitable for them.Additional safety testing: Each country has its own guidelines to follow.New packaging: Many times you will have to convert packaging into other languages specific to the selling countries.International trademarks and a distributor agreement: This is another case where you need a good lawyer.