The Podcast
Show Links
- Cool-jams - https://cool-jams.com
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Transcript
Scott:
Hey everybody, Scott Austin here. And this week I have a guest for us to talk to and her name is Anita. And she owns her own company that she started over a decade ago now called cool jams and they sell pajamas that are wicking pajamas. So they're made for people who maybe are a little bit sweaty or hot and wanna stay cool. And are our, company's been very successful over the past decade plus, so welcome, Anita.
Anita:
Thank you. It's a pleasure to be here. Scott,
Scott:
Can you first explain a little better than I did? What cool jams your product is for our listeners?
Anita:
Yeah, I, I think I can do, do you some justice there? We actually are a, we, we like to say we're a sleep solution company because not only do we have pajamas, but we also have, we also sell two collections of temperature, regulating bedding. So we like to solve the problem of people overheating and sweating at night. And we kind of discovered we first started just marketing into the menopausal woman. And now, you know, as time has gone on, we've discovered that the market is much larger. There's men that get hot there's people who live in warm climates, people who get night sweats because of an illness, you know, there's so many reasons for, for temperature, regular issues at night. So we have tried to discover the solution and we think we, you know, have some great products that help people in that position.
Scott:
And Cool-jams has been around for a while. How did you get started in the beginning? What is your origin story?
Anita:
My origin story. Yeah. So I first, I'm a partner in a textile factory overseas, and I did have a lot of experience in the textile business, but I'd always been kind of interested in performance fabrics. I was personally having night sweats. This was about in 2000 was when I started doing research on this idea. And I thought, what if I found a fabric that could help me? And I figured that if I was having this issue, there were probably millions of people around the world that were also having this same issue. So I did a lot of research, found a fabric that was actually originally for the Canadian military that I took. I tweaked it, I changed it. I made it softer and basically turned it into a collection of sleepwear. And I tested it on people. We tested it in labs and found this, this fantastic solution for the problem of night sweats. So that's kind of the background story. I decided that I wanted to start an online business. And that's when in 2007 was when people were just starting online brands. And I thought I can do this, you know, and I just started putting one foot in front of the other. I didn't really know that much about eCommerce and eCommerce, eCommerce marketing. So I kind of feel like I've been back at university learning over the years. So yeah, that's kind of our background story.
Scott:
Well, that's, you know, such, such a founders story, the typical one, you had a problem of your own. You had an expertise that not everybody had and you put those two together and came up with a unique solution and brought it to the market. That's sort of like the eCommerce dream right there. That's awesome.
Anita:
Yeah.
Scott:
How big is is cool jams now that you know, it's been around for 12, 14 years now?
Anita:
Yes. So first of all, I'd like to say that I started it as a lifestyle project, just thinking, oh, this will be kind of a good hobby project. I'd kind of retired from my former job. And I, I was sort of, you know, in, in a little transition and didn't really wanna work too hard. So I started and I've completely bootstrapped this company. I do not have any debt. And right now our sales are a little over 2 million. And we our, we really started scaling about a couple years ago when we move moved over to Shopify.
Scott:
Yep.
Anita:
And Scott, you know, all about that because you kinda helped us in that transition. And so our goal this year, we're projecting three to 4 million in revenue.
Scott:
Wow. That is, is quite a growth. So you've got this business, that's been around over a decade. You're doing millions of dollars in revenue per year. How many full time employees to you have at cool champs
Anita:
One? That would be me.
Scott:
<Laugh> yep. That's awesome. And how many part-time or contractors or outsource people do you think are involved in the business?
Anita:
That that's a little bit of a difficult question because we hire a lot of groups. And for example, you know, our three PL our, our third party warehouse, we have hundreds of people there that, that work for us, but, you know, I deal on a daily basis with one or two of them. So I, I'm gonna go through just quickly the types of things that we do outsource. Okay. And that'll kind of give you an idea mm-hmm, <affirmative> outsource, like for example, head of customer service, she's an outsourced individual that manages all the rest of the customer service people that we have. We have a call center and we have, you know, several operators there at our call center. We have an online chat team. She would manage that. We have a face book slash TikTok marketing manager. We have an AdWords Bing manager.
Anita:
We have, I already mentioned our three PL warehouse. We have a design and production team. We have an inventory manager, we have a social marketing manager who manages all of our social channels and we have web development. So those are the main things that we outsource. And I can tell you that I started doing a lot of the, when I first started, I didn't outsource anything except, you know assistance with web development, cuz that wasn't my expertise. And slowly as we started making income I was able to start outsourcing a lot of the things that I didn't really know as much about or wasn't as interested in doing.
Scott:
Yep. Yeah. That makes sense. And so you listed a whole, whole bunch of different responsibilities or roles you outsource. Are there any that you think you shouldn't outsource and that you've personally, you know, kept control of that would apply to every company? Just not, not your personal preferences?
Anita:
Yeah. I think just for me, I liked to be the center of the spoke of the wheel. So I kind, I wanna know. So the overall management of the company, yeah. You can hire an outside manager, you know, I could do that, but I think, you know, the, the CEO responsibility, the, the strategy for growth and aligning all these people, the general manager, that's kind of what I do.
Scott:
Yep. Yep. And is there like a conscious reason why you've picked this outsource strategy versus hiring full-time employees or did it just evolve organically?
Anita:
I actually think it's, it's you save a lot of money and energy by not having full-time employees. One of our is that, you know, to hire employees in California, you know, you have social security, you know, all the, the, just all the extra stuff that you have to take out of a paycheck. I've been there. I've had employees before and I don't really wanna manage people. Although I indirectly the, the issue for me is that if someone does a great job, you know, as a contractor, we're very loyal and we keep people on. If they do a great job, we will work with them forever. We are best friends, but if they don't do a good job, it's really easy to replace a contractor. Versus it's really difficult to replace someone that isn't working out. There's so many rules and laws. And, but you do have to be really careful with 10 99 employees because we have some strict rules. So they all have to, you do have to follow the rules about, you know what a 10 99 or outsourced employee is. And one of the biggest things is that they cannot work solely for you. And they have to have, you know, they, they have to have some other, you know, people they work for and they have to have, they can't be doing the same thing every day, you know, because then they could be classified as an employee. So you have to be, you know, you do have to follow the rules. And we do, you know, every, every person we have working for us is pretty much their own boss. And I find that people who are their own boss, they know what it's like to be self-employed and they're super motivated to do a good job because they want to be paid for their work <laugh>, you know?
Scott:
Yep. That, that makes total sense. And how do you determine, you know, that it's time to outsource a role that you've been taking on over time? You know, how did you know when it was time to outsource and what you were gonna outsource? Is there a threshold you hit?
Anita:
Yeah, that's a good question. I think the, I started outsourcing things that I didn't like to do myself or I was not good at, for example customer service I did for a long time, but you can't always have the same customer service, you know, it makes you look kind of rinky-dink to have the same person answering, you know, all the time. So I knew that I needed some assistance and you can't always be there at your computer. So, you know, with e-commerce you have a ton of customer service work. So that was one of the first things to go by hiring a call center, online chat, and then some you know, a person who is kind of ahead of customer service, but she also does some, you know, virtual assistant work. She does a lot of different things, but again, every, and you know, and then the second thing to go was all the marketing tasks.
Anita:
I used to do that all myself, but I knew that I, you know, was it, it's a lot of work and, and it's gotten even more complicated, you know, with more channels and there's always new things to learn. And I figured that somebody else could do a better job than me. And even though I knew enough to be dangerous, I could carry it on. It was just too much for one person as we grew. And if, if we wanted to grow, if we wanted to scale, I needed more expertise, web development, ive never done, cuz I it's not, I can and do a little, you know, HTML to make some quick changes, but I am not a developer. So that was another thing. The last few things to go were, oh, in three PL warehouse that we've always, you know, outsourced, I've never shift and packed.
Anita:
That was something from day one that we always outsourced. I did not wanna pack boxes and, or manage, you know, shipping and that kind of stuff. Some people do, they ch you know, we, we have volume, you know, we have a lot of volume and it just would be way too much for me to handle the last thing that we actually really outsourced. And that was because we started growing and we needed more help was inventory management. We're starting to use some, some tools. There's a lot of tools that you can use, but we actually hired someone to help us, you know, with that and design and production. I, I still, my hands in that a little bit, but the actual design and production is all done overseas.
Scott:
Yep. And how do you find the person or company to outsource too? The, the idea of outsourcing sounds, you know, totally appealing to most people, but it's really hard in execution, at least in my experience. How do you find those people or companies that are, that are the good ones that you wanna keep?
Anita:
Yeah, well, that is a challenge. And I can't say that my first pick has always been great. Like my first warehouse, I, I'm not gonna name the name, but they were a disaster. You know, they, I, I think the owner was on drugs or something because it was just a disaster. And although no one is perfect, I think trial and error. And, you know, the other thing is really checking references, you know, ask people for, for personal references and not just one, but two or three, you know, even hiring, you know, any mistake you make, like, for example, picking the wrong warehouse, it's super expensive to move all your stuff. That's sitting at a warehouse to a brand new warehouse and pay all the integration fees. So you wanna make good choices, but I would say, you know, don't, you rely on what they say, check references and see what their former employers say and ask them the question.
Anita:
If you were me, would you hire this person? And they can't, you know, I, I know there's certain laws against what you can say. Mm-Hmm, <affirmative>, you, you might be able skirt some of those, you know? Yeah. You know, would you hire this person today, you know, and see what they say, the sites that I use, there's a lot of good sites to find freelancers. And one of 'em is fiber. The other one I use is guru. Linkedin is a great place to find people and Upwork, if you are a Shopify site and you're looking for, you know, like different apps or people to do things they have a pretty good, you know, they, they have their developers listed if you needed a developer or, you know, there are a lot of people listed on in their resources. But I do think that, you know, making look at people's reviews, look at the, you know, see what the, the re you know, what kind of referrals they have, and that usually helps and make sure you call, you know, call these folks and see, you know, check up on them.
Scott:
Yep. Do you actually require a conversation with them in like a video conference type thing, or, or how, what, what sort of communication screening you do with them?
Anita:
Yeah, always we have a conversation, you know, you can tell and not, not always video, you know, I, I, I would say the, at most of my contractors have been with me for quite a few years. Like I said, we're very loyal if we find somebody good. The latest one that I got rid of was my, my Google marketing group. I switched from one group to another, and it was a really bad decision. And now I'm a great group. And, and, you know, that was done via video conference. I it's hard to make a decision sometimes. And when I say group, sometimes I work with boutique agencies for certain aspects. If they're really good at one thing, I may hire them for that. Don't always just work with a freelancer. I've had that. I've also worked with agencies who do everything, and I tested that, but that, to me, in my opinion, that's a bad idea because nobody is good at everything. Yep. So for me, it's best to find a freelancer or a boutique agency that's specialized in branding or specializes. You know, for example, last spring, we re we did a mini rebranding and we hired a branding agency. And that, that's what they did. That's what they, they did other things, but that's what they were good at. And that worked well for us.
Scott:
No, that's really good advice. Now you mentioned, you know, five and up work. Are there marketplaces or platforms where you wanna call them that you've gone to, that you've had, you know, that you don't use anymore? Cuz they don't get you the results you're looking for?
Anita:
Oh boy. I would say of those four. It's not always, you know, it's kind of hit or miss know, some people have been good and some people have been bad and that's where you know it really, you have to do the research and have to check the references. I think it's super important. Some people like to use, there's like some sites that specialize in workers from the Philippines, I've heard, those are good, but personal, I have never used them. And, but you know, that might be another source and sometimes just a simple Google source, a Google search, you know, looking for specialist in social media and see what comes up, you know? I that's worked for me too, so yeah. But I can't say that. I think it, there are good and bad on every site. Yep. Yep. I would not, you know, rule out one because I had one bad experience.
Scott:
Now, do you have a preference for geographies, time zones, languages, those kind of things. Do, do you factor those in?
Anita:
Yeah. So for customer service, I'm pretty funny about that. I really like us based native English speakers. I think for my target, a it's super important. It may not be for other target audiences, a little older and that works for works well for us. So all of our, all of our customer service team, the call center is based in Utah. The chat service is based in San Diego and our, our, the head of customer service and some of the other customer service people they're in California. So, and then as far as the other things, we do have a few people that are located overseas. My creative guy who does a lot of artwork for us and ads and stuff, he is based in Bangladesh actually mm-hmm <affirmative> and he's so super good, super creative. He speaks English well. And then my head of custom, not customer service, sorry. My head of Facebook marketing is a, a guy from India. Other than that, everybody is north American. So I, you know, I definitely, I don't really care about the time zone necessarily. I do care. I, you know, I do need them to speak English. I speak a couple languages, but I don't speak <laugh> I don't speak any, I, I speak German and, and Turkish. So those two languages aren't so helpful. <Laugh>
Scott:
Well, and your customer support being American makes sense to me also for cultural reasons like, like today we're recording, this is April 15th, 2022, and today is normally tax day. And it's not this year, the tax day of this year is on the 18th for a bunch of different reasons and it's Easter weekend. Right. So, right. Those are just things that, you know, somebody from another country may not know about and seems disingenuous. If it comes up in the conversation, like, you know, you should be asked the question today, Hey, got taxes done. But people from another culture may not know those kind of things. So I, I find that cultural relevance is a really important one for at least customer support.
Anita:
Yeah. No, I agree. I think, you know, for, for us that has worked out well I'm not saying, you know, even Microsoft, you know, so, you know, big companies use people from oversee. Yeah. Amazon, you know, we sell on Amazon and anytime I try to call them for assistance, I always get somebody from overseas and they're helpful, but you know, it's, it's not like speaking to your neighbor sometimes.
Scott:
Yeah. Yeah. And one of the sources you mentioned that I wanna understand a little bit better was LinkedIn. How do go on LinkedIn and source potential partners?
Anita:
For me, you know, I would look for people in my network. You know, I have a pretty extensive network on LinkedIn at this point and first do a search and it might be specialist in inventory or specialist in email marketing. Actually, there are two folks that I got via LinkedIn by just doing that. It would be San Diego. You know, I did a search on LinkedIn looking for email marketing SP or Clavio marketing specialist, which is the E the email marketing tool that we use. And some folks popped up, you know, and the guy that I use to manage my email marketing, he was one that I, I didn't mention earlier. He's a separate guy, awesome guy based here in San Diego. And he's really helped us develop our Clavio, email marketing remarketing, and all the other stuff we do and SMS marketing. So that was via LinkedIn. And then my inventory manager, I found him via LinkedIn. And a third one I found via just by doing a, a search, basically.
Scott:
Yep. Now on LinkedIn, these people that you're sourcing, are they freelancers or, you know, small agencies or are they at a bigger company and you're just a, a weekend project for them?
Anita:
No all of 'em are freelancers, but some of them may have it's, it's actually both, for example, my email marketing got, he works solely freelance. I think he also had he has a listing on Upwork too. Sometimes I cross reference I'll go to Upwork and find somebody and they don't list the full name, but if it's an odd name, like Ghan, that was his name. Yeah. He's actually a Turkish fellow that lives here in San Diego. And I went over to LinkedIn, just Clavio marketing Ghan, and he popped right up. So, and sometimes it's easier just to work directly with somebody, if you have a good feel for them. And they have a good portfolio rather than going through one of these other channels
Scott:
That that's interesting point working to directly versus going through the channel. Why would you prefer to go directly in some cases? What, what are the advantages there?
Anita:
You can just, they can just bill you and you can pay on via PayPal. It's a little less expensive for both. I think because, you know, like for example, if you work through fiber, fiber gets, everybody gets a, a cut a commission. So if you can and establish a long term relationship and you're comfortable with the person after a few months, there's, you know, you can just like, I, I just get billed and pay them, you know, via credit card or whatever.
Scott:
And are a lot of your, your vendors. Are they by the hour or they buy the task? How are you, how are you paying?
Anita:
Well, I have I have most of 'em on retainers. Okay. Yeah. Yeah, because I, you know, and you have to figure out what that makes sense. And some of 'em start off on the task and if I like them, then we move to a retainer. If you trust, you have to have a certain amount of trust, but it usually starts off as a task. Can, can you fix this? All our email marketing flows, you know, go in and they'll give you a price and you accept it. And then, and then it's like, you know, I really like this person. They were very conscientious. I would like them to do my weekly campaigns. So then we moved to a retainer. I'm trying to think back things like, you know, your three PL that's just all build on a, on a weekly basis. You know, so that there's no retainer or anything there, you have a contract and you have a certain set fees for certain tasks that they do for you production. That's all based on what is actually shipped. And you have your, your you know, the design and all that is built into that, that cost. So it's kind of both, I guess.
Scott:
Yep. Yep. And when you're doing the contract directly, do you actually paper it with a, with a contract and both parties sign it or is it oh
Anita:
Yeah, no. It's like do this task and when they're, it's completed, you get paid <laugh>. Yep. Yep. I I'm, there's some contracts I have signed with small agencies, you know, definitely there are are some, but if, if I'm working with a freelancer, I, there have been some, you know, for example, our branding agency, well, they're more of an agency. I would say. It depends on the person we don't. And we, we will have, like, for example, I'm gonna the email marketing guy, he is, he manages our, he gives me reports. He does two campaigns a week, and this is our agreement. And if he doesn't do it, then he knows that he would lose his position. I wouldn't work with him. His retainer would stop. So, yep. Yeah.
Scott:
And I like the less red tape method. And so leads into my next question is like, how do you ensure quality? You know, you talked about, you know, you're, you're basically trialing them and slowly growing their responsibilities, gaining confidence, but is there measurements you put in place? Is it gut feel? How does that work for you
Anita:
That, you know, other than getting some good to begin with, you don't have control over whether or not someone has, does a good job or a bad job, but it's pretty apparent very quickly. If they're not the person for you. Like I said before, if somebody does a great job, I am so loyal. I've had people with me for 10 years. If they do a bad job, it they're outta here. You know, I don't, I might give 'em just say, Hey, you know, at you, you like any, even if it was an employee, you'd have a chat and say, I need this to improve. We need this timely. We need, you know, whatever the issue is and you give 'em one chance and if it's not done properly, then they lose their, the, the, they lose that money. They lose that job, you know, mm-hmm <affirmative> and we, you know, some of our, we pay really well, these people that are on retainer, you know, and so they don't wanna lose 2000, 3000 a month. You know, some of them are paid, you know, a lot of money. So yeah, <laugh>
Scott:
That that's really, you know, it makes sense. The there's a mutual incentive for, for both parties there. So in all these, you know, years of doing this, do you have any like, horror stories? Like what can go wrong? What, what should people be? You know, prepared, what's the worst case scenario they need to prepare for?
Anita:
Well, you know, for example, if it's a small agency, COVID was kind of an issue, you know, if somebody gets sick, there's no, you know, they can't work. You know, you don't maybe don't have a backup person. So I would say illness, you know, generally freelancers work on their own. They don't have any backup. So that is an issue. Whereas if you're working with a large agency or you have a bunch of employees, someone can cover for somebody else that isn't, that is a problem. <Laugh>. So I would say that, for example, our first I started chatting about it before our first warehouse that we were with, I didn't know enough to ask enough questions about them. They just had good rates and they were, are located in Colorado. And I thought, oh, that's not too far away. If I needed to go there, but they were a disaster.
Anita:
<Laugh> a disaster we had. And, and on top of them being a disaster, there was a tornado at our warehouse. And they, the w all our stuff got flooded. This is when I first started it within the first two years, I happened to be overseas. When that happened, it was like a nightmare, you know? So that part, the flooding part and the tornado that hit our warehouse couldn't have been, you know, prevented, but I should have asked more questions about the ownership and their reliability on getting packages out and, you know, but I didn't. So the next time around, I did a whole spreadsheet of, you know, probably 20 different warehouses and you know, got, you know, recommendations. I did their recommendations, you know, from others. And, and we asked all the right questions because we knew what to ask because of all the issues we had at the previous place. Yep. Yep. Well, sometimes you live and learn, so yeah, there are disasters, it, it isn't like, you know, it hasn't been perfect, but yeah. I guess experience teaches you a lot.
Scott:
<Laugh> well, and I, that's so true in so many things, right? Like, you know, the whole, what would you do difference? Like, I wouldn't have done anything different, cause I didn't know those things in the beginning. And I had to learn them to know, to do things differently than next and experience is so important. So I wanted to have you on this podcast to explain to people how you can be a large successful Shopify store and outsource a lot of the responsibilities, and you've done a fantastic job with that. And I appreciate it. And, and I love the fact that, you know, your, your biggest recommendation that I took away was really do due diligence and checking your people and the references being part of that, the interviewing process, the checking, you know, their sources and all that kind of stuff. I love it. Is there anything else as we're about ready to go here, that we haven't talked about, that other Shopify stores should know about from your experiences?
Anita:
Yeah. So I, there is a closing point I'd like to make. And one of, and that would be that, yes, we bootstrapped we're over 2 million in sales. I'm the only employee, but I do know that at some point I will probably have to hire some regular employees. You can go so far. And I think COVID really kind of, you know, we just, we grew so much during COVID because what were people doing? Buying pajamas and at home,
Scott:
You know? Yep.
Anita:
So that, that's when we really took a huge leap and we've continued that growth, but I, I do know that, you know, you, you eventually, I will have to hire some people or some outside funding to, because right now I'm debt free. I have no employees, but if I wanna grow and continue to grow, I will have to create a little more substance within cuz I can't possibly manage any more people or more team. Yep. So that is that, that is, and I guess it depends on how, how much you wanna grow and, and how much debt you wanna take on, you know, it's, it's pretty it's, I guess it's a personal decision, you know, for folks, but right now I'm the center of the spoke of the wheel. I manage all the contractors and I basically do the stuff I like and hire the rest out.
Scott:
Yep, yep. That, that's awesome. So you can use outsourcing to grow to seven figures, but I'm assuming, you're saying that to get to 10, 10 figure or eight figures, sorry. You probably need to have some, you know, full-time employees.
Anita:
Yep, yep. I, I would definitely need to do that. So
Scott:
That, that, that makes sense. Well, thank you for your time today, Anita. This is really helpful.
Anita:
Yeah. Well, thank you. It was a pleasure talking with you and I hope I inspired a few people.
Scott:
Well, you have certainly given them some knowledge and, and I'm sure they'll benefit from that. So thanks a lot.
Anita:
Okay. Take good care.