From zero to hero selling online (Part 3)

In this last part of the article I want to conclude by disclosing how I decided to stop selling ketogenic snacks online, despite quickly climbing from zero to 44 orders a day in only 3 weeks. On day 21 the first complaint came in. I realised that if I shipped the chips on Friday after 2 pm for orders received on Thursday night, then the mailman would have picked up the parcel only on Monday. The post office was in a mall with air conditioning on during the day, but at night it would have gone warm and humid. Hence the chips became saggy and lost the characteristic crispiness.

My products were home cooked with no nutritional table, no expiry date and no list of ingredients printed on the box. Besides being unprofessional, it could have been dangerous. So I immediately made an appointment with a central kitchen and enquired about moving my production over there. Not only my oven was at full capacity, but also I needed to be on the safe side of food regulations.

There was a process available that could have extended the shelf life of the product up to 75 days, but guess what? I needed to wait 75 days. That would have meant two and a half months with no snacks being produced and sold. Also, the central kitchen was Halal certified, and my ingredients needed to get the Halal approval before they could be used in the kitchen.

Moreover, the kitchen would not have just cooked whatever recipe I provided, but they demanded that their chefs validated my recipe before cooking it. Lastly, the nutrition table could have been done at the National University of Singapore (NUS).

All together I calculated the cost of halting production for 2 and a half months plus all the costs involved with the processes required, and added to it the cost of hiring a person to cook and pack the chips. It summed up to approximately $25k. The products were sold at an average price of $4.

I realised that I could have invested the $25k but it would have taken me quite a while to get my money back. On top of that I would have needed to invest more money in marketing to start selling on other platforms, but the main problem was not money. It was time.

I was full time employed in my own startup and my schedule was getting really packed. There was no room for me to play around with a hobby turned to business. So I decided to drop the whole project. I therefore set all the inventory to zero and ceased operations.

Overall I have learned the following lessons:

Lesson 1: Get things right first. I should have been in compliance with the food regulations from the very beginning. The whole experience to me was just a test, but I ended up being overwhelmed by the speed of the success.

Lesson 2: Use marketplaces. There is no need to have your own online store if you can ride quickly on an existing marketplace.

Lesson 3: Don’t spread too thinly. My resources (such as time and oven space) were at 100 per cent capacity within three weeks. I should have planned bigger from the beginning.

[Stefano Virgilli is a member of the International Press Association]