Being an entrepreneur is tough. But being an entrepreneur in an upside-down world is a whole different story. We talked to the IdeaPros CEO, Fred Cary, about overcoming the obstacles and changing our if to how.
The Obstacles
The last two years have been tough with the costs going up and influencing manufacturing and shipping making it difficult to get your product to market. Until now, we have always thought of China for manufacturing our products, as they have become the most competitive price point. But there have been supplying issues. Manufacturers can’t get the supplies they need to make your product, parts are unavailable, and we don’t know when this will change.
The shipping cost from overseas has gone up fivefold, or tenfold in some cases, and it has become an exponential factor in your sales. Mexico is closer but doesn’t have the facilities or the infrastructure to manufacture as efficiently as they do in China. In addition, gasoline prices have gone considerably up, so moving goods by truck will be more expensive, too.
“Rethinking the whole China thing is something that every entrepreneur should do.” – Fred Cary
With the lack of availability, rising cost, and delays in receiving goods, the option of manufacturing in the USA doesn’t look so bad anymore.
Thinking Outside of the Box
With all that’s happening, some entrepreneurs give up, some get stuck, and some plow through. The only way to plow through is to change your mindset and find a solution. One of the options right now is to go as local as you can. If selling products online and shipping them costs you too much, you may think about getting your products to brick-and-mortar shops. Sending 10,000 widgets to one location costs less than sending one to 10,000 locations.
If manufacturing overseas is too expensive, consider manufacturing locally and going back to the old ways of selling. Knock on some doors, talk to people, and start networking. You don’t have to charge the local stores until they sell your product. Start developing a market, getting sales and reviews, and then expand from there.
Embracing Mistakes
No matter how successful you are as an entrepreneur, there will be mistakes, accept them, deal with them, and flourish from them. Be patient and remember nothing ever happens as you want it to happen.
“The sooner you recognize mistakes are part of the game, the better you will deal with them.” – Fred Cary
When things come up, new entrepreneurs tend to give up. It’s normal to have self-doubt and insecurities, but you can make it only if you learn how to overcome them and turn a detriment into a benefit.
Be Willing to Pivot – If Necessary
Be agile and willing to pivot. Adjust instead of waiting for better conditions.
“Pivoting is like breathing. If you don’t do it sooner or later, you’re going to be out of breath.” – Fred Cary
Don’t complain. Be prepared and flexible. Whatever is happening to you, it’s happening to the whole world. Deal with it, and you’ll start getting traction. The situation is probably only temporary, and you can get back to the way you wanted to do things in the first place.
The “Idea Pros” at IdeaPros have the resources, experience, and tools to help you at this step or any step in the entrepreneurial journey. We partner with entrepreneurs at any stage and who are ready to invest their ideas. Apply for an interview and lets explore partnering together.
Tessa Ashford:
Changing “if” to “how” launching in an Upside Down World. Hello, everyone, Tessa here with the IdeaPros marketing team and I have Fred Cary. Hey Fred!
Fred Cary:
Hey guys. How’s everybody?
Tessa Ashford:
Good, if you don’t know Fred already, he’s the CEO of IdeaPros and has been innovating businesses for, how many years now, Fred?
Fred Cary:
Too many.
Tessa Ashford:
Too many. And we’re talking right now about, obviously, the world’s in a little bit of an upside down state right now and a lot of people are concerned. So, how do we change it from ‘if’ to ‘how’, Fred?
Fred Cary:
Yeah, and you know, this was actually with the careful planning that we do before each show, Tessa. I decided I wanted to talk about this about two hours ago, maybe three hours ago, dealing with one of our partners who has product, is selling product and is trying to ship their product and now, the shipping cost is more than the actual product itself. And we’re talking about what to do about that. And it really brought to mind the fact that this has been a crazy ass world here for over two years now. Some entrepreneurs just give up, some get stuck and some plow through it. The only way to plow through it is to think way differently than our traditional thinking has been. And so that’s really what I wanted to talk about. Just changing that mindset to be able to find a solution and be able to get your product and get it out there into the marketplace.
Tessa Ashford:
Awesome. So how, I mean, obviously, the costs are going up, everything’s going up. How can we do that? Do we get innovative in where we choose to manufacture or what would be the best way to go about this? What are you recommending?
Fred Cary:
Yeah. Well, I don’t know. I’m hoping the audience will tell me.
Tessa Ashford:
Oh, nice.
Fred Cary:
No, I do have. I do, but…
Tessa Ashford:
But hey, let us know in the chat what you read, what you’re thinking.
Fred Cary:
Yeah, exactly. Well, let us know if you’ve done something different to get your product to market, then you’d had planned on doing but let’s just go through the gamut here and talk about different things because I’ve had several different partners in different types of trying to find a solution where they had been taught to go down one road. And all of a sudden that road turns out to be a dead end or turns out to be a toll road that you’re gonna have to pay a lot more to ride on than you thought you were gonna have to do. So if the very first thing is the manufacturing, you know, China, China, China, China, that’s all we ever talk about because they are so competitive and their price point are so low compared to anybody else even compared to going to Mexico which is right down the street from us should have very inexpensive labor but they don’t have the facilities and the infrastructure to be able to manufacture as efficiently as they do in China. So, that’s where we always go. Now, we’re running into issues in China. We have supply issues. When I talk about supply issues, I’m talking about the components that make up the finished product that you’re gonna develop. That’s becoming a bigger and bigger things, a thing that’s led by other issues that we’re gonna talk about in a second. But the very first thing that we have is the inability of some manufacturers to get the supplies that they need in order to make that finished product that you have. So, that’s a very first thing that we come across as an entrepreneur, we can’t get what we need. In fact, yesterday, I gave a ‘WTF’ exclamation point email response to something that I got from engineering that basically said, “Hey, these parts that we need for this one, this one thing that we’re building, they’re not available and it’s gonna be a year or two before those parts that we need are available.” Well, that’s not acceptable. You know, that doesn’t work. So, what are you gonna do? You’re gonna sit under a rock for two years and wait for it to happen, or are you gonna be really entrepreneurial and think outside the box? So that is one of the scenarios that we’re gonna be facing going forward. Parts are much more expensive and the parts are unavailable in some cases. So now, rethinking the whole China thing is something that every entrepreneur should do. I’m not saying there’s a better solution necessarily but you gotta look because you don’t wanna sit under that rock for two years, you do wanna try to find a solution and that solution may not be in the location where you’re starting. So…
Tessa Ashford:
So, location and then also getting creative about the parts that are going into your product. I’m sure it’s like, is there an alternative, is there something else that we could use instead of this to get it here faster or to create it right now?
Fred Cary:
Right. So now when you couple that lack of availability and rising cost and delays in receiving goods, when you compare all that stuff to even manufacturing in the United States, it becomes a little bit less of a spread because now maybe, you can have a product and you have all your components available here in the US. However, there’s another component as well that is continuing to make everybody crazy. And that’s shipping. The cost of shipping from overseas has gone up fivefold, tenfold in some cases. And so now, the cost of shipping as a factor of what you are selling has become exponentially larger. In fact, we have launched the Honey Hush product line of blankets and the cost of shipping was $500 more than the cost of manufacturing. All the units that we had. So, shipping costs was above manufacturing costs. We still are able to get that done at a price point that makes sense for the end consumer but it’s insane. You know, typically the shipping costs would be 1/10th, 1/20th of the total cost of getting the goods over here. And now, it’s got to the point where you have to add that to the mix. It costs $40 to manufacture something in the United States and it costs $20 to manufacture it in China but it costs $25 to get it over here. Then, you need to rethink that, right? So, United States can start looking a little bit more attractive or other areas where shipping is not gonna be that big of an issue like Mexico. For example, you can, you can haul by truck in Mexico but now you have the other problem. What is that? I’m glad you asked. Gasoline prices, right? Gasoline prices have gone through the roof as well. So now, even shipping and transporting across the United States can become very expensive because gas prices are going up and are gonna continue to go up. I mean, and everybody wants to blame somebody for that but there’s a big ass war in Europe. First time since World War II that we’ve had a conflict like that. And one of the players happens to be a big supplier of oil. So, do we do the right thing? Now’s my ethical speech. Do we do the right thing and just accept to the fact that we’re not gonna take oil from bad guys? Well, most oils is produced by bad guys, I guess probably is true. But from these particular ones who are getting really violent and taking over territories that are peaceful countries that are trying to be pro-Western, do we just sit back or do we do what we have to do even if it bites us in the ass a little bit because it increases our prices? So, my vote is we have to deal with increased prices right now. So, that becomes a factor as well. So, what does that all point to trying to go as local as you can, okay? And trying to differentiate your go-to-market strategy in general. I had another partner this morning. We were talking about the fact that they are online, they’re shipping products and the cost of shipping a product has now gotten to the point where it’s almost as much as the product itself. It’s a different product, not Honey Hush.
Tessa Ashford:
Okay. It’s not gonna be all depressing things so just hang in there. Fred’s gonna have some positive things to say too, or maybe he won’t but I’m sure that we’re gonna turn this into “how” shortly. So, stick with us.
Fred Cary:
Right. Right now, we’re talking about the battlefield, you know, what is out there. And by the way, as an entrepreneur, I was just interviewed for a magazine story here this morning and they said, “What is one thing that you, in hindsight wish you knew earlier?” And I said mistakes. And he said, “What do you mean by that?” I said, “I wish I knew earlier that no matter how far, no matter how advanced, no matter how successful I am in my career or in the career of any entrepreneur, there’re gonna be mistakes. There’re gonna be mistakes all the time. And as soon as I recognize that that’s part of the pie we eat, the better it was for me in dealing with those mistakes.” Right? So, we can look at every single decision that we’ve tried to make. I’m producing in China. It could have been a mistake but you have to deal with it because now, it’s there in front of you and if you’re not gonna welcome them in, you’re gonna be all worried. Like Tessa was talking about the depressing news. If you just realize, “Hey, that’s part of the game, I’m an entrepreneur. That means I’m crazy.” So, how do crazy people deal with things like that? They try to find solutions.
Tessa Ashford:
They find crazy solutions.
Fred Cary:
And sometimes, you need to find crazy solutions. So here, for example, with this particular partner this morning, we’re talking about the fact, you know what? Online may not be the best solution right now in some cases with shipping costs going where they are, depending on what it costs for somebody to buy your product compared to what it costs to ship that product. So with him, we started talking about what can we do that we were thinking of not doing? And what we came up with is stores, real stores, brick and mortar stores. Because if I send a thousand or 10,000 widgets to one location, it’s gonna cost me a lot less per widget than it is if I take one widget and send it to 10,000 locations, right? So, thinking outside the box as an entrepreneur, you may even want to go to your local stores. It doesn’t even have to be a Walmart or a Target or any of those big national chains. How do I start? How do I make penetration? How do I get my product out where people can actually buy it? So, look to manufacturing locally and try to compare that cost with the cost of manufacturing overseas including shipping, try to get as close to where you are as possible. And then start thinking about selling locally at first, go back to the old ways of selling, you know, go take your widget, go to the local stores that might sell it. Maybe it’s a local hardware store. Maybe it’s a local department store. Maybe it’s some dollar convenience store, whatever it is that could sell your product, go start knocking on doors. Because now, I can even go and say, “Hey, I’m gonna give you a thousand of these. I’m not even gonna charge you for them until you sell them. I have them sitting in my garage. I don’t have anything to do with them. Let me go place them somewhere, start developing a market, start getting sales, start getting the penetration I want, and then start expanding outward from there.” So, the solution to all of this “if” stuff could very well be in your case, local. How do I go local? How do I keep it small? How do I keep my transportation costs low? How do I ship a thousand units in one place instead of one unit to a thousand places? And that can get us along the way and get us started so that we’re doing the “how” instead of the “if” part.
Tessa Ashford:
And if you’re curious on how you have this conversation with those local vendors, I know if you had, say an alcohol product and you wanted to go figure out where, how to get in the locations, go to somewhere local and ask them who their distributor is. And then you can start finding out, building a list of people that you can reach out to. So, I know Ty, who I wanna have on our show again, has given us that advice in the past. So, it’s really getting out there and doing it, looking into these opportunities, asking people, making, networking, like network with people that could get you into the right conversations and right loops, too because it will make a difference.
Fred Cary:
And as an entrepreneur, you gotta be a couple of things. You have to be patient and nothing ever happens the way you want it to happen. Something always comes up and we’re tempted. If we’re new at this, especially, we’re tempted to give up. We’re tempted to do the “if” part. “Oh, okay. I’m gonna wait two years for my part because it’s not available now.” That is really warm and fuzzy and comfortable and within our comfort zone because guess what? We don’t deserve to win anyway. Right? We’re always full of self-doubt, insecurities, we’re trying something new, we don’t know if we’re good enough to do it. People around us are telling us, “Nah, why did you do that? You got a great cushy job.” You can’t stay there because you’re never gonna get anywhere. And you need to embrace these things and use them as a strategy to say, “I’m gonna get out in the marketplace when other people are too afraid to do so.”
Tessa Ashford:
Exactly.
Fred Cary:
Right?
Tessa Ashford:
That’s how the benefit.
Fred Cary:
Yeah. So, I always take something that’s a detriment and turn it into your benefit. This is a world I didn’t plan on having but now, I can go local. I can say that I’m selling local. I can deal with people that I can see eye to eye and get them to understand that what I’m trying to do with my product is something that is not only important but it’s also, I’m a neighbor. I’m a friend. I’m somebody that’s in the community. And I’m trying to create a business. Think outside the box, find your way to go to market. Even if that, the way you chose initially turns out to be a mistake because the things that you didn’t anticipate were going to happen.
Tessa Ashford:
Right. And I think being nimble and willing to pivot, Fred’s favorite word, be willing to pivot if you need to so that you can adjust and not just wait for better conditions. I love how Aziza put it. Something always comes up, you need to be prepared for anything. I think not even just be prepared for everything but be flexible for anything that’s coming. You know, don’t get too settled in on what you expect. It should be the way you launch.
Fred Cary:
Yeah. Well look, pivoting is like breathing. You know, if you don’t do it sooner or later, you’re gonna be out of breath and it’s not gonna be good for you. So, you just have to be prepared to take whatever comes your way and find a way to deal with it instead of, “Oh, shit. Why did this happen to me? First, I had the pandemic. Now, I got COVID just in my neighborhood. I don’t wanna go wear a masks to places to knock on doors. Forget all that stuff. Just deal with whatever your environment is, make it happen. And you’ll start getting traction.
Tessa Ashford:
I love what Jared said. If you are having these challenges, so are your competitors. So it kind of even, I mean, it isn’t even playing field. If it’s not working for you right now, it’s probably a good time. Like Fred said, to take advantage of those things that are going on when you can, and I know you say this best but in those trying times, you’re actually gonna invest more in the marketing and getting out there. Right, Fred?
Fred Cary:
Yeah. You have to have a voice and you’re either gonna give up or you’re not gonna give up. And if you’re not gonna give up, you gotta play the game the right way. And guess what? It’s like being halfway through a card game and somebody changes the rules. All right. Well, you gotta play the rest of your cards in a different way and that’s what’s happening right now. It’s probably only temporary. And you can get back to the way that you wanted to do things. But right now, I wouldn’t even think as much about making a profit as I would think about making penetration, you know, get into the marketplace, start getting your product sold, start getting people giving you reviews and expand from there. This is gonna be over at some point. And then you can go back to the way things were
Tessa Ashford:
Awesome. Well, I think this was really good, Fred. Thank you. Did you have anything else you wanted to add before I cut you off?
Fred Cary:
No. I just, from the article that I spoke about this morning, you know, mistakes always gonna happen. They’re always is gonna be there and you always have to, number one, accept it and number two, deal with it and number three, flourish from it because the changes that you make are the ones that are gonna make you successful. Changes you don’t make are gonna put you at the bottom.
Tessa Ashford:
Awesome. Thank you, Fred. I’m so glad we had you on for this Friday’s live. Thank you. We’ll see you later.
Fred Cary:
Okay.
Tessa Ashford:
And I’m gonna go ahead and take a couple seconds. I saw you guys over in our chat awesome comments I love. Katy was saying that she is really glad she did an app instead. And that is an option. I saw a couple people talking about pivoting. If you are, Shawn, I know I saw your comment but if you are, there’s Katy. It’s a mess. She’s happy she’s doing an app. What if you, you know, if you are making a physical product, in fact, we have a couple partners have that like a two part product. So they had a physical and an app. Right now might be a good time to be making the app part depending on what dependency it has on the physical product. Right? And I love what you said, Robert. It’s an excitingly frustrating time to attempt to enter a market as an entrepreneur. But hey, if you don’t take the time like Aziza said and you just keep putting it off and putting it off because conditions are gonna get better. It’s never gonna happen. In fact, I had this awesome image from my marketing team today, and I’m gonna try to put it on because you guys just have to see. This is so funny. It was so cute but it was an illustration. I’m gonna post it in today’s chat but it’s like, what happens when you wait? And you’re like, I’m gonna jump off that diving board and you’re looking down, there’s too much competition, a bunch of people in the pool. You know, it looks like good conditions and there’s like a tidal wave in the pool. And, so I’m gonna post it. You guys can just, there’s never a perfect time. There is always gonna be challenges in the industry. There’s always gonna be things that are coming up. And if you are positive, which I saw somebody else say in the chat too, if you just have a positive mindframe and, or mindset and you’re ready to adjust, oh yeah. When you can’t change the direction of the wind, adjust your sails. I love that. And really, we are here every single Friday to help you guys. I know it’s difficult out there. And so what we wanna do is be a conduit for you, a way for you to get positive, really good information, to run your business better. So I hope that we’ve done that today, guys. And we’re here every Friday at noon, Pacific time, if you haven’t already hit the bell to get reminders when we go live, please do also in the comments is our signup form to get notifications. We will text you and I wanna get you guys involved. So I know you guys are in the chat right now. So let me know in the chat, if you would be willing to come on to a Friday live and talk with me in kind of a Q and A environment. We have a lot of cool things that are in streamer now. So we can have panels. We have lots of different things. And if you’re not willing to go live, if that’s a little intimidating for you, maybe you’re willing to do a video and then submit it and we can post out because I want, you guys are the core of what we do. All what IdeaPros is built for is to help entrepreneurs just like you to get through all these steps in building a product and in the app, and really just having the awesome business that you deserve and that freedom and financial, you know, awesomeness, that’s there for you. So, if you are willing to either come on to one of the Friday lives or submit a video, let me know in the chat and I’m gonna hook you up. Yay. I’m glad. So we have some people who are willing to come on and Steven, you should be on one of the shows. So, and I’m gonna mess your name up, Inmail? Is that how you pronounce it? Let me know if I am like butchering that or send me an audio clip even and let me know how to you pronounce your name. At the end of the day you have done your best when you put a 100% in like Hector says if you are doing your very best that’s all that matters, right guys? So, yay, Stevens gonna come on too. Awesome guys so I will see you next week for Friday Live, noon, pacific time and just have a blessed week guys. I appreciate you being here and you really are a loved from the IdeaPros team. See you next week!