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All new years bring a sense of growth and excitement to many business owners. It's a clean slate full of opportunity to grow and get to the next level. 2020 was supposed to be an essential year for many small businesses, including us. Still, it is turning out that coronavirus (COVID-19) has been the blocker for a promising year, and we have not even completed Q1. We gave a little insight into what was happening in this post.
We're a small team of two that work out of a home basement. We've been working on this business since 2017. As of October 2019 both of us have committed full time to work on the company (left our full-time jobs) to see where we can take it by the end of 2020 as 12-14 months was our full-time financial runway.
We had our first Black Friday Sale with good success, considering we spent $0 on marketing. We were not able to fully leverage the potential of Black Friday (hit 80% of our sales target) as we fell short on parts to complete more watches.
The shortage of product supply was 100% our fault in supply planning. We were in the middle of making a product change, which should have been completed and ordered in September of 2019. We were working on the 3-week lead time assumption our Chinese supplier had always honored.
We finally placed our order in the first week of December (3 months late). We assumed our supplier could turn it around by Christmas - which they did confirm was possible. Christmas came, and they said they would have to bump us to mid-January. We were disappointed but still optimistic. Mid-January came, and they said it would have to wait till after Chinese New Year. We started to get worried now. We had 7 backorders from our Black Friday sale that still needed to be made.
During all of these setbacks, the coronavirus had begun to spread in China, and our suppliers' factories were closed indefinitely post the Chinese new year holiday.
This put us in a bind. We behind on backorders, new orders, and preparing for our first appearance at the One of a Kind Spring Show with no samples to show. And on top of it all, we had not created and put out a new watch in months. This kills content creation and the ability to keep the social momentum of the brand.
In talking to our Chinese suppliers, they seem to be getting over the hump and returning to work just as things in North America have started to escalate with coronavirus. Due to the current social distancing mandates, the One of a Kind Spring Show has been postponed till June. This is unfortunate as we were counting on the show to help get our sales momentum back. Still, we totally understand and support the decision as we can't also have an empty show.
We can't blame coronavirus entirely for our poor financial performance. We're taking accountability as well. We're curious to see how consumer behavior will play into our entry-level luxury/novelty watch, but time will tell.
This week's VLOG shows our progress in the shop up until we were notified of the show cancellation. It's lock downtime from here on, but we'll continue to document the process as we go. If we can make it out alive this year, we think the future will be promising, but for all small business owners, we can only tackle it one day at a time.
Stay safe out there fam!