Holiday Mess and Mistakes

One Startup. No Secrets. Start at the beginning.

It seems that most accidents don’t happen because of a single factor, but rather a chain of errors coming together to allow for a disastrous outcome. Well, our preparation for and execution of holiday sales was about as close as you can come to a disaster, without being an actual disaster (at least as perceived from the outside).

I can at least give us credit for thinking about being prepared and trying. I can’t, however, give us credit for getting it right. Casey’s research told us to be prepared for 3-4 x our normal order volume through the holidays. But since our order volume has never been consistent month-to-month (with regular growth) we were left with a tough prediction.

Would any of our customers place repeat orders for holiday gifts? Would we actually be included in any gift guides? Would these gift guides convince people to take a chance on purchasing a food product they'd never tried?

Casey, to his credit, wanted us to prepare with a stock of 6,000 bottles of Bees Knees Spicy Honey, ready to be dropped into boxes and get out the door as orders came in. But then Ted and I stepped in with some complicated mathematics:

6,000 bottles x $6.50/bottle = $39,000

Well, we didn’t have $39,000 cash then and we don’t have it now, so that seemed like a stretch. We decided to grease the bottleneck in our supply chain and placed our two biggest orders of bottles to date, convinced we’d never actually sell 6,000 bottles of spicy honey and this would leave us well prepared. Boy, were we wrong. 

Right after our bottle orders were placed, the disaster chain began:

• Our first order of bottles was short-shipped by 80% and our second order of bottles was backordered indefinitely. We had no backup supplier.
• Then all that press Casey had been working on started to hit, and it was hitting big. We had sold over 6,000 bottles with still two weeks to go before Christmas!
• Then we realized that chili peppers are out of season and nearly impossible to get in the quantity we needed.
• When a customer orders a product in December, they expect it before Christmas. So we were approaching a concrete deadline.
• Needless to say, there were many other problems and there were more than a few days when we thought we couldn’t pull it off.

So with a little hindsight, where did we really go wrong? 

1. Cash Restriction: I think this was a very real problem. However, we could have provided bigger personal loans to the company or asked friends / family for some small loans or investment money to help build a deeper stock leading up to the holidays.
2. No Backup Suppliers. Thank goodness our beekeeper had a deep stock and was unwavering in their support to help us pull this off. However, we weren’t so luck when it came to our bottle supplier and chili pepper supplier. We should have identified alternative sources and options ahead of time and prepped them of our anticipated needs. We were lucky to find last minute solutions for these key components
3. Communication. A business is just like a relationship in so many ways. And poor communication is at the heart of so many broken relationships and businesses. While Casey wanted 6,000 filled bottles in stock, Ted and I dismissed that forecast because we had no idea the caliber of press Casey had been targeting. For example, I only found out that Casey had pitched the Today Show the same day I found out Bees Knees would be featured on the Today Show, 3 days before it aired!
4. Communication (again): Many customers praised us for communication of our delays and updates on their orders. But in retrospect, we should have provided more frequent updates and better expectation setting. It would have put many customers at ease and likely would have reduced the thousands of emails and phone calls we fielded.
5. Overthinking It: In the first month, Casey and I didn’t grant ourselves the liberty of overthinking anything. As Ted pointed out this week, we might need to remember the lessons from the first 30 days. Maybe we didn’t need analysis of our supply chain and a detailed forecast before the holidays. Maybe we just needed to build as much stock as possible as far ahead of time as possible…

As I think Casey and Ted agree that our holiday season provided us with months worth of experience and learning, we’re going to share that experience and learning over the next few weeks. For example, you might be wondering how we generated press that led to sales over nearly $30k in a day at our peak…

Well, me too. Next up, Casey will share his plan and execution that led to our insane holiday season sales.

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Haven't tried our Bees Knees Spicy Honey Yet? Go ahead, order a bottle or two. We're so confident you'll love it that we'll give your money back if you're unhappy for any reason.