Sunday, January 25, 2015

My Dog Ate My KS Funds (part 5 of 10)



5:  Shipping and Scale Up

     Customers generally want three things when placing an order with your crowd funding project.  #1 approximate shipping date, #2 confirmation when it ships, and #3 no hassles or damages upon delivery.  Customer satisfaction cuts down on problems and keeps them coming back for more.  Always put yourself in the customers shoes. 

Damaged goods are not entirely avoidable.  We are dealing with a middle man, the postal carrier.  When a box travels from point A to point B, you will never know how that parcel is handled.  Then there is the possibility that customs will open your carefully packed box, look through the contents to assess value, and then carelessly throw the figures back in the box for delivery. 

There is also figure design.  One particular sword wielding figure that I shipped out in my first KS was prone to bending and breaking off.  I’m currently having a sculptor redesign the hand and sword on the figure so as to avoid future shipping problems. 

Regardless, the goal is to keep the figures from shifting and you can never over insulate from that possibility. Here are some materials to help prevent damage. 

Chip board boxes:  These little boxes are shipped condensed and flat, are offered in many sizes/shapes and can be quickly assembled. In my region of the world, I order them from Uline.com or MichiganBox.com for the cheapest shipping rates to me.  You want to order heavy cardboard office supplies that are close to your location to save money.  I primarily use chip board boxes to fill up the space as best I can within the main shipping box, creating a box or boxes within the main box.  This re-enforces the strength of the box and helps to prevent against damage should your box end up at the bottom of a heavy pile of materials during shipping.  (customer satisfaction #3). 

Chip board boxes on the left and corrugated on the right

Zip lock baggies:  Initially I was against the use of these handy and cheap containers, but over time I discovered they are great for separating parts into groups, keeping tiny parts from loss, and can be folded in many ways and tightly packed into the chip board boxes.  These too can be ordered from Uline.com in many sizes.

Case of 1,000 zip baggies size 3 x 4 inches

Stuffing:  Recycle whenever possible.  I shred most of my business paperwork after seven years because you can’t be audited in the USA after that period.  If you don’t generate a lot of paperwork, then shred newspaper which you can find in great quantity from neighbors or recycling center dumpsters even in today’s digital age.  You will have to invest in a paper shredder (mine is a floor model with wheels, cost around $160 several years ago, and holds eight gallons of shredded paper).  Small table top shredders are not very reliable so spend the money and get a good one. There is that initial cost but then your stuffing is free for years to come.  Fill in areas within the chip board box with shredded paper to keep the contents tight. 

My shredder can cut 30 sheets at a time, paperclips, and CDs
 
Outer shipping box:  In the USA, use USPS.com because your priority shipping boxes are free.  I do keep a generic brown corrugated box on hand (ordered through MichiganBox.com) for orders that I want to ship first class outside of the USA to reduce shipping prices.  You can further save money by creating prepaid shipping labels through the USPS.com website.  Tracking information is generated on each online purchase and automatically e-mailed to customers fulfilling (customer satisfaction #2).   The online service allows you the convenience of running the labels the night before, and then simply dropping them off at your local United States Postal Service center avoiding having to wait forever for the clerk to do the same time consuming work.

     Basically, if you design it right, you should only have costs tied up in zip lock baggies, chip board boxes, and packaging tape with the stuffing and outer boxes costing you nothing. 

Scaling up:  The maximum amount of orders I could cast, sort, box, and label in a weekend was 50.  The online labeling alone took approximately one hour per 10 labels.  I would cut and paste the shipping information and e-mail information directly from my KS pledge report found in my accounts area online, into the USPS.com account to keep the information as accurate as possible.  This also allowed me to flag the rewards that were shipped as I was generating the labels and then filter pledgers out of future reports to keep track of who was taken care of.  If I were to type and copy it by hand, there may have been typos and delays in delivery.  Lastly you pre-pay before the labels can be downloaded and printed, and affixed to the boxes.  Time is a major factor in running a successful crowd funding project and scaling up is simply the term for repeating a process in greater multiples.  I had close to 250 pledges divided by 50 a week or five weeks.  Due to some unforeseen problems it took me six weeks to ship them all.  If I would have received 1,000 pledges the shipping would have taken 20 weeks or five months to complete. Scaling up is a good estimating tool that allows you to pass information to your supporters to keep them informed as the project moves forward supporting (customer satisfaction #1).

Shipping charges:  As mentioned in the previous article “The Math Behind Rewards”, if you need $10 shipping and handling to cover expenses per reward, you will need to increase this amount by 1.1 or ask $11 shipping because the crowdfunder host is going to take fees out of the end total.  I can offer free shipping in the USA even though it costs me $5.25 each because I factored that into my formula as a cost for my project like metal, packaging, etc.   Free shipping is a great way to attract customers if you have room in your profit margins.  I asked $10 from overseas customers because my average overseas package cost me $14 to ship (base cost/expense of $5.25 on all orders plus $9 overseas customer after crowdfunding fee). 

Crowdfunders:  Keep costs down by looking at many ways to box all orders, as long as the savings does not impede the safe arrival of the products within.  Scale up when a project ends so you know how long it will take to ship.

Pledgers:  Projects that ship beyond the year they were promised will often run into increased shipping costs for the crowdfunder, who has already  budgeted in that expense in a previous year and now has to raise more funds. 

Next Week:  Walk the Talk

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1 comment:

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