Turning Your Side-Hustle into a Legitimate Business

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Refreshing takes on legal strategies, straightforward answers to difficult tax questions, independent ideas on building wealth. It's the Refresh youh Wealth show with Mark Kohler and Matt Sorenson.

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All right, welcome everyone to the Refresh youh Wealth podcast with Mark Kohler and Matt Sorenson. We are delighted to be here with you today. Delighted. Yeah. We hope you're safe however you are and however you're listening to us or maybe you're watching us on YouTube. We're going to have some special guests come out later on the show. And today we are talking about how to turn your side hustle into your main hustle.

Yes, it's going to be good. And Matt did point out that I was wearing college gear today. You know, I'm wearing my Ute gear. I'm hoping for a college football season.

Go Utes.

Anarchy in America if there's no football. So I'm just trying to put out positive vibes. We're just a couple months away from some football, maybe. Cross your fingers.

Yeah.

Okay. Now before we have our. We're going to have Lemon and Loom. The owners of lemonandloom.com a children's clothing and accessory online business, started as a side hustle by two young mothers. And they're going to tell us now, with seven children between the two of them, how they built this business. So I think it's going to be a really fun interview.

But.

And we've also got some tips ourselves on five or six. And we're going to see how they evolve here and summarize them at the end of the show for you. But we want to get out of tax and legal tip quickly, very quickly, because we've got a long show here planned for you and a lot of content. So, Matt, you want to do the legal tip?

Yeah. Let's rock and roll, baby.

A legal tip that you can actually use.

A legal tip where you don't feel like you have to take a shower after all.

Right, so the legal tip is about PPP3B Paycheck Protection Program. I just. If you missed last week's show, this is so critical. So many small businesses out there have received these PPP loans. The eight week period, which is when you got the money, you had eight weeks to spend it and request loan forgiveness. That was extended to 24 weeks. They tripled the time period. That is good news. If you haven't heard that yet, want to make sure you got that update. Check out last week's show where we went into the detail on that or my article which you can get from the newsletter or on Entrepreneur where I go into some of the other changes that happen. Most of it was good news, but I just wanted to reiterate for today's show as a legal tip that a new law passed. Trump signed it into law about 10 days ago. Now that extended the eight week period to 24. Really good news for small business owners. Hopefully most of you that got PPP will be able to spend all of it, every penny of that loan and get it forgiven.

Okay. And I'm gonna add a quick rider to Matt's tip. If it's acceptable from I will yield.

Yes, that is allowed. Or I don't know how, I don't know what they do on an amendment. Objection. I think that's without objection.

Yeah. Representative from Arizona. So the Eidl, the economic injury disaster loan portal was shut down at the SBA for a month when after they got overwhelmed. It is now up. So this was in the last 48 hours. So if any of you have not applied for the $10,000 grant, which if you don't do the PPP, that grant based on $1,000 per employee that you had employed last year, what were the number of your employees you get $1,000. That is a free grant. You do not have to return it, you do not have to pay it back unless you get the ppp. It's going to play a factor in that. Watch the show last week. But when you apply for that free grant, they automatically allow you, they automatically enroll you in the application process for a disaster loan. And based on the numbers in this application, guys, this is a five minute application, maybe 10. You can do it right online@sba.gov look for the coronavirus Financial Assistance Economic Injury Disaster loan application. Four or five pages, you're done. There's no personal guarantee, no credit check and no lien against your real estate that you personally own. Now there's other 504 and SBA type loans, don't get it confused with that. This is an Eidl loan. That application portal is now open and it's part of the same one. So I'm going to leave it at that. Like Matt said, go listen to last week's show. But that portal is now available. So get there and apply if you Haven't. See what you get. You can always turn it down. But why not?

Okay.

All right, well, let's hit to the head of the main topic, if you don't mind. And we're.

Tax tip. You're going to take.

Oh, you want. Oh, you had a. I thought that was your tip. But you want to give a legal tip and a tax tip. Okay, okay. All right. That's called a double dip tip.

Oh, no, no. I was just adding a writer to your tip.

Okay, okay.

A tax tip you can actually understand and won't put you to sleep.

Tax tip. That could save you thousands.

All right, quick tax tip, and this is a fast one. We now have until July 15th. That's the deadline, based on the extension provided under the CARES Act. That's four weeks away, people, if you're listening, you know, immediately upon production of the show. So that's four weeks, July 15th. One tip. You can still contribute to a health savings account for last year for 2019, and get a tax deduction on the front page of your return. No matter what your income level is. It's $3,500 if you're single, $7,000 if you're head of household or family. And you just have to qualify with a high deductible health care plan last year in 2019. So in the next four weeks, as you're preparing your returns, or if you're going to amend and you haven't made that contribution yet, you've got four weeks to do it and still take a deduction for last year. All right, that's my little tip. So, Matt, the main topic. Turning aside hustle. What do you think?

Yeah, the turning aside hustle on the main hustle. And do you want to introduce our guests? Maybe? I mean, you kind of.

I think I want to go through a couple of our tips first. You know, tips, and then we'll summarize them here at the end of the show. But I've written down five or six tips, and. And I know that you had a few since I just spoke. You want to throw out one of your tips. There's no particular order here.

Yeah.

But I'd like all of you listening to. Try and write these down or re. Listen to this when you have a writing utensil. Yeah.

I think for those that have done a side hustle, you're in that process right now. You have a side hustle. And let's say this is a side hustle that you really want to turn into your main hustle, like lemon and loom. Who will bring on here. You know, it's something you're passionate about, let's say. But I think you really need to take an analysis of. You kind of need to be very practical about it, I guess. Don't be emotional about it and maybe you don't like your job or that. Because when you start a side hustle, we don't want you to quit your main job, we want you to keep that job. It's your income that you're living off of that may even be helping supplement the business expenses right now. Keep that main, that main job. But as you're building the side hustle, there's the point where you got to decide, alright, does this side hustle become the main hustle? And I can quit my job. But before you do that, I want to just make a detailed analysis from a financial standpoint about how you're personally going to live. Because if your personal life, your income day to day is wrecked and now you've got your business, you're running full time and you're stressed financially, you're creating a perfect storm of failure because you're gonna be so stressed about your personal finances, you're stressed about the new business you're trying to take to the next level. So you want to make sure you've got that in alignment, that you've got enough money from the personal financial standpoint to really leave that job and then ramp up and go to the next level in your business.

Yeah, and I'm gonna, I've summarized that as don't be emotional or act rashly. A lot of times we have people so excited to make side hustle a main hustle. They're like, I quit my job, I'm doing it. I'm like, yeah, no, don't quit your job yet until it's too expensive to go to work and you're making.

And I know there's a point of satisfaction in this whole process where it's like, I got to quit my job, you know, and it's like, and I get to go 100% into this business that I've been building, that I love and I'm passionate about. But just don't go too early on.

That's next. I'm going to say one of my tips is before you really make the jump to the main hustle, start treating your side hustle like a business. It's going to make you more successful, going to save you taxes. And what I mean by treating it like a business, start with a separate bank account, start bookkeeping start tracking your expenses more appropriately. Make sure you're treating it like a business, because that's really what it is. It's a schedule C, as in Charlie on your tax return. People are, like, blindsided by, oh, I got a 1099. What do I do? That's a business. And so I think people, you got to come to grips with a side hustle is a business. And when you start to treat it like that, you may not enjoy it as much. You may not find that it's profitable as you thought it was. It may not be as enjoyable. Is a business mindset versus kind of a hobby mindset. But since you're getting to 1099 and you're making money, the sooner you start treating it like a business, it's going to give you that insight into what the future may hold.

Yeah.

Okay, Matt, next, your tip.

I think just with any new business, and this applies to your. Once you're ready to do main business, you've got to do a business plan or strategic plan is probably the better, better name for that. So. And going through that process of a strategic plan, Mark's got a chapter in his book, there's prior podcasts we've done on it. What should be in your strategic plan. So go check that in the podcast history. But this process, you may have gotten excited and started your side hustle without doing it, but going through this process is necessary for your main hustle. And also, and this strategic plan, by the way, is going to go over like, what are you doing? What are your objectives? What are your priorities you're going to get into? How are you going to start marketing this business? What are your products you're going to do? I mean, and once you go through writing that out in a detailed process that you can carry around with you, Mark and I carry our strategic plans around with us. You know what I mean? So you carry that around with you. It's just. It's very valuable to you. You update it as you go, and it's something that you operate the business with. Yep.

I love it. Okay, number four. And I want to give you a reality check, and that is you're going to be the jack of all trades. And that's okay. When you start to take a side hustle and go big or main hustle, it doesn't mean you're all of a sudden going to have a staff of nine people. There's my marketing director. There's my bookkeeper, there's my shipper, there's my production, this and this.

Yeah, there's customer service, there's my salesperson and everything. And what that is is that's you. And like the, that house of mirrors, by the way, it's all you. Okay. That's the same guy.

And if you feel isolated, alone or overwhelmed, that's normal. It's okay. I really want to say that because you may feel picked on or you're a failure or you've done something wrong. Nope. We've all gone through it. And to this day in our businesses, Matt and I wear several hats. And that's okay. Embrace it. And it's going to help you get a grip on how you're going to grow it. As you start to divide up duties and go, okay, if there's a duty I'm going to delegate first, it's this one, but I'm going to do it for now. And I'm okay with that. But that's. You start to figure out where you're going to hire your first intern or your first, first full time or part time employee and start dividing up responsibilities and realize you're going to be the jack of all trades.

Yeah. Yeah, I love that one. Okay, well, you got another one because I'm good on tips for now. Three more.

I've got three more. The next one is there's going to be a point where you have to set up your formal entity and that's a point where you usually want to get a consultation. And because you're going to go from this side hustle to I'm going to need an LLC or corporation, a tax ID number. I'm going to open now a formal bank account. Before you go out and open a merchant account under your Social Security number, you're going to want to think about getting that formal step completed. It's a good time to get a consultation with someone that's got a legal and tax mindset, not just one or the other. Because if you meet with your accountant, they may send you the lawyer. And then you meet with the lawyer, they send you the accountant. This is web spin. Our claim to fame at our little law firm is all of our attorneys are tax attorneys and several have either masters in taxations or a CPA license. So we can give you that kind of double headed dragon advice and help you get that decide on is the LLC or the S Corp.

Right.

And the timing and I know Matt, you do a lot of consults on that. I'm kind of jumping to that formal step. What would you. Anything you'd add to on that?

No, I mean we've got, we generally want you to be an S corporation, of course, just so you know, that's the entity of choice for most small businesses that are selling a product or service. We want you to be an S corp. Now you may have been an llc. You some, a lot of people start their side hustle and they just go set up an llc. Pretty simple and easy tax reporting still their sole prop on schedule C. And maybe you've done that for a couple years and sometimes your side hustle goes for years. Okay, we're not talking about like side hustle for like two months. I mean maybe you're lucky and you can ramp up that fast to a main hustle, but so you might have been operating for a couple years as an llc. You can add an S election to that so that LLC is taxed as an S corporation, which will help you from a tax saving standpoint. So get a little planning on that. That's going to save you taxes. As your side hustle turns into a main hustle, it opens up more taxation, of course you're going to have on more business income, but also more tax planning opportunities and ways for you to be strategic and save on taxes.

Okay, now I've got next is start doing some more training and education as an entrepreneur and don't and this is part of I've got two tips. I'm going to separate them later and they're in the article that way. But I want to just say this. It's not a race, it's an adventure. Don't feel like you've got to rush out and be the biggest, baddest business in the first six months or year. Take your time in the transition. Read some good business books. I would hope you digest multiple podcasts of ours, multiple YouTube videos, our books. We're all about helping the entrepreneur succeed. You don't know what you don't know. And a lot of you were very, very successful in the corporate world or the restaurant world or the customer service world or who knows, that's great. But being a small business owner is a different animal. And it's okay to go to a weekend conference, soak up everything you can, eat a little bit of humble piece and then don't feel like you're rushed and don't feel like it's a race. And so Matt, I put that as kind of training study and then don't rush to success. It's ok. You don't have to measure yourself against your neighbor. Ok. Any final thoughts, Matt, before we introduce these Ladies,

I think I'm ready. Let's bring on the special guest.

Let's do it. All right, well, we've got our special guests on the show now, and we're so excited to have something that's at least more pleasing to the eye on the YouTube channel than Matt and I. We said we were going to have two homemakers now business owners. And you expected some raggedy looking moms chasing kids around the house. And we have these two beautiful ladies with us now. So thanks for joining us. We've got the owners of Lemon and Loom. And just because it's. Don't feel slighted here. They are equal partners, but on our screen here, Haley's up on top for some reason. So, Presley, I apologize. At least that's my layout here on my screen. So I'll introduce Haley Smith up in the top left corner. Is that where is that Matt on your screen is Haley up in the top left corner?

I'm the very first one, so you know what? I'm okay with it.

All right.

Sorry, Presley.

Yeah, you've been tapped demoted now, but

I guess we're all looking at a different layout, so. But it's okay. And those of you listening to the podcast, you're like, who cares?

Yeah, just get moving on. Yep. So we've got Haley Smith, who resides in this greater Salt Lake area and is the 50% partner in this amazing business called Lemon and Loom. And I'll explain that in a moment. And then we have Presley Dayton here in our other quadrant off to the right, if you're watching on YouTube. And she is in the southern Idaho area near our Idaho office. And I've gotten to know their family over the years and watched this little business of theirs from afar and given a few little tips here and there on the front of the lawn while we're bumping into each other in the neighborhood. And they have just blown up and they're killing it and it's so exciting. So, ladies, welcome to the show.

Thank you so much.

Okay, all right, now before I ruin the introduction business, I'll let Matt ask a question and probably let you guys introduce the business. But Matt, go ahead. You sound like you were going to ask him something.

I was gonna give him a layup and let him, you know, I'll let you introduce the business by the question. So tell us, you know, the topic of the day and what we've talked about already is turning your side hustle into your main hustle. Let's start at the side hustle. Like why did you guys start this? What was the need for it? And how did you start making it?

Just a side hustle now, Matt, these are sisters. They're gonna fight if you don't. You better call out one of them for the question, because they're gonna.

I'll give it to Haley first because she kind of started the beginning. I mean, it's since morphed into something else, but she kind of started it all, so.

Okay. All right, Haley, you're up.

Okay, I'll take it. So. Okay, so about six to seven years ago, I was living in Ohio, and I wasn't near any family. I was a new mom. And I think I just had that itch to start something. So I bought a few bow ties, a few dresses, a few things like that, sold those. And then finally I approached Presley, and I just said, let's do something together.

Since we live far apart from each

other, it'll kind of be something that brings us together. So we got a small loan and purchased 700 blankets. They were just muslin pom pom blankets. We threw them up on a deal site, and crazy enough, they sold out within, like, the first. You know, the first day. And what's so funny is that Presley and I were both out of town at the time. And so our parents were the ones that ended up having to ship it all out within a couple of days. So they had a time frame that they had to have them out, and Presley and I just left them to it. So. Sorry, mom and dad. But from there, it just kind of morphed into what it is now.

Why blankets, though? What was the.

Well, I mean, we're both moms. They're like. They're swaddle blankets, you know, like where you wrap your baby really tight.

Okay.

I keep them like burritos or whatever. So we're both moms, seven kids between the two of us, it's just kind of become, like a nice thing that we get to create products that we love and that we get to use, and then we get to sell them and make some money as well. So that's why I blinked it. You know, we both were new moms, both kind of looking for a specific pattern, looking for a specific color. And, you know, some. You know, some of the things we liked were out there, but we decided to make our own so that we could, you know, get something.

Okay, I got one more question then. I will. I will yield some time to the gentleman from Idaho for a question. Okay. So, okay, you sold 700 blankets pretty quick. What was unique about the blankets.

Like, what.

How did you know it would sell that much? Did you know the price point? How did, like, why did it 700 sell?

Do you want to take it, Chris? Sorry, go ahead. So initially, that's kind of another point. But we initially started out with a different name, and we started selling on deal sites. We didn't have our own website. I don't know if you ever heard of, like, jane.com, different things like that. So it was a perfect price point, I think. And it was being marketed quickly because they were doing the marketing, they had all the money in it, and they had a good following on social media, that sort of thing. So, yeah, I think it's both of those things. But since we've. That's why we rebranded. That's another side.

Yeah.

Because we wanted to get away from needing the dill sites to sell our products.

Now, we mentioned this earlier on Lemon and Loom, but if you missed it, I want to point that out. All of you. If you want to be looking at the most cutest baby photos, and if you geek out on baby pictures, these are pretty cute. Get over to Lemon Loom. That's L, L. Sorry. L, O, o, M. Like, I guess a loom of cotton. Yeah. All right. So lemon and in, spell out and a N D. It's not the ampersand. So lemonandloom.com cute little babies. And now it's morphed into a lot of products. Now I want to ask this question. I'll come up to Haley for a moment. So this is the big conversation people have is they've got this side hustle. Then it's like, oh, my gosh, do we keep doing this little thing or do we go to the next level? Tell us some of the pros and cons and what you're in your mind, and then I'll. And I know Presley's opinion is probably different on this, too, but what were you nervous about or concerned about as you were trying to decide to go from smaller to larger?

I think Presley and I have always. We've been kind of teetering back and forth, whether it was putting our full attention into this or just still keeping it a side hustle. And I think that that was one of the big things was we just. It was money, too. Just saying, okay, we've got to push this to what we want it to become. And I think it was just putting all of our eggs in one basket and just going for it. Is there something else that you want to add?

Was it Money. Were you afraid of the time commitment? Presley? What concerned you?

Oh, you're saying concerns? Yeah, I think initially, yeah. I mean, seven kids were busy. Our husbands have full time jobs. They're the providers. So I mean, this was adding another full time job to us so that we had to sit down. This last, it was about a year ago when we rebranded and we had to say like, are we in or are we going to kind of shut this down? Because the side gig was just enough to make us busy without bringing in enough. And anyway, so yeah, we ultimately decided with our husbands, it was like, you have to help us, you know, pick up the slack where the kids are. And then we just jumped in. Yeah, money. But money is a thing too. Time, money, all of those are, you know, concerns and challenges. Does that answer the question? I'm not.

Yeah, yeah, no, I know. Matt was. Matt wanted to follow that up. No, that's great. I love it.

So, okay, so tell us where you're at now just so people can get an understanding of that. And me too. And then I had a follow up question, but like your first shot out, you sold 700 blankets on a deal site. Your parents shipped them out while you guys were gone over a weekend. And then you keep selling on deal sites, right? Like how many blankets have you sold now? And what are you selling now? Like on average a month?

Yeah, Presley.

Okay, so, well, it's morphed. It was deal sites initially and we would sell 700 every couple of weeks or whatever. Since we the rebrand, we have stopped selling on deal sites. We've changed our name so that people come to our website because we found that selling on deal sites, they would not come to a website. I mean we didn't have a website in the beginning, but then they wouldn't come because they wanted the deal, you know.

Yeah.

So we rebranded, changed our name and now they come to our website now. I mean, Haley, what do we sell? I don't now. I mean we bring in. I have, I probably have like 7,000 items sitting in my garage. I mean we're, we're shipping out a lot more now.

Okay, what do you think, Haley? A month production, what are you shipping out a month average?

Well, so we launched in February and I think it took off from there. And I think our first month we. I mean, are you looking for a dollar amount or like how much number of blankets sold?

Just how many blankets?

Blankets anymore? We're now doing like pajamas, Hair bows. Well, I mean not hair bows, like top, you know, a hat that Goes with the sleepers, quilts, crib sheets.

But I Bet we're between 500 to 700 items were sold within that first month.

But that was the last week of February. That was. We launched the end of February.

Yeah.

Every month I think we're like one to 2,000 items.

Okay, so one.

Okay.

All right, we're gonna have to talk after here, ladies. You should have that report. You're like, let me see. We're gonna come to who works harder here in a minute.

So there you go. Okay, well, let's. Let's ask about your products. Okay. So you were selling blankets before. Now you started selling complimentary products that the same buyer of the blanket would buy, I guess, for like a baby.

That's what.

So it's all in that category.

We're in the baby children industry.

Yeah.

Okay.

So, yeah, about a year ago, when Presley and I decided to go through the rebranding process, we decided we wanted to come up with a product that was unique to our brand. So we started researching different things. Of course, we're moms of many children, I feel like. And it was just one of those things that we brought a bunch of different things all meshed into one sleeper. And so it took us a long time. We started, like I said, probably about

a year, maybe even a year.

A year and a half ago. Of course, it just. It just launched. So from then, we, you know, we were doing prototypes, receiving items from our manufacturer, going back and forth, changing items or changing certain things. And then we had to go through testing. And I don't think we realized that the process was going to take that long. I think in our minds, we were like, oh, this is, you know, give us a couple months and we'll be ready to go. And I think the biggest snag that we hit was during testing, making sure that everything, you know, the zipper worked right as well as the fit. The fit had to be exactly right so that it fell under a certain category in testing, if that makes any sense.

I'm a little confused in testing, because if you're making a little sleeper for a one year old, how do you gauge their satisfaction with that sleeper?

Safety compliant regulations with the US like is all you mean, or you're saying, oh, you're saying like that a baby likes their sleeper. Oh, yeah. So they pass testing?

I guess so if they sleep for 30 minutes or more. Green light.

There you go.

Yep.

Okay. But you guys have some safety rules you have to follow?

Yes.

And so did you know that going in, I mean, how did you know that stuff?

Yeah. We actually looked into this a few years ago when we were just doing swaddles. And this was again, it was the side hustle. Then we're like, we don't want to deal with all of that. Like, let's just stay with the blanket thing.

Blankets, no safety stuff. Your entry.

Yeah.

And so when we decided to switch over, it was like, well, we got to go all or nothing, you know, going. So we did it. And it took a long time and a lot of money.

Now that's probably. Let me ask that question. And either one of you that feels more comfortable answering this, I think a lot of people that are listening, like, okay, side hustle. I can sell some crap on ebay or do a little service on Craigslist and all that, but going to making this a full time gig and really hitting it hard seems like there's a lot of boundaries or barriers, I should say barriers like money, all that. What's some advice you'd give? Maybe I'll ask each of you, whoever wants to go first, what would be some advice you'd give to the side hustle? Stay at home mom, Stay at home dad, or someone with a full time job trying to do this in the evenings and weekends. If you could do it over, what would be some advice you'd give to overcome some of those barriers or those at least mental mind blocks of how scary it is?

I think for me, like, it's not. It's not a matter of what I would do over, but I think it's necessary to pick a category that you're passionate about because we benefit from this category every single day as we're putting our kids to bed and they're getting in a sleeper that we love and we designed and using our swaddles that we love and we design. So I think you have to initially find something to sell or do that you love and have, like, passion for. You know, I don't know. I think that's. And then also a good business partner. Everyone says don't do business with family, but it's worked out for us. You know, it's fun to have something that we get to do together. And we don't live near each other, but we still, you know, have something that connects us.

Yeah, I asked your parents about this and they're not happy. They're the shipping department and apparently it's not working for them. So I just want to point that out.

We're moving it out, obviously, and shut.

Just play.

What advice, Haley, would you give I

mean, I agree with Presley, but I think that Presley and I also complement each other really well. I think that she has a lot of strong suits that I don't have as well as, you know, vice versa. And I think that we each just focus on each of our like the things that like each of our jobs. And it just, it happened. It just works out well. I feel like.

Okay, okay, let me. I wanted to ask about. Okay, so on the deal sites, I just have a couple. I know. Was that your last question mark?

That was like a. I've got more. I've got so much, but.

Okay. I didn't know where you were at because that's kind of like a final question type question.

No, no, no. I want to get back to testing.

Okay. So are on the deal sites. So just for people out there, the deal sites, they take a cut of what you put up. So you're paying for that to be on there.

Yes, so. So initially. So with deal sites you have to mark down your product. So say each sleeper. We had them on our website or sorry, not sleeper. Each swaddle, we had them on our website for. I think our price point was 1699 to 1899. And then you would have to mark them down. So we'd mark them down to depending between 10 and $12. And so they. So from there you mark it down and then they also get a 30% cut at that point.

Okay.

You're.

You're also. Your margins are a lot smaller at that point as well. And then they're taking, you know, a pretty decent amount from each item.

Do you get. Do you get the contact information of the buyer so you can like add them to an email list or anything or do they not provide that? They just basically give you a shipping address and it's like you got to send your product here. Like you get their credit card and stuff like that so you can like.

Yeah, no, you don't get the credit card information and their, their personal information does come through their name, their address, as well as an email, depending which site. A few sites give you that email, but. But others don't. We were so new and dumb though.

We didn't take that information and really use it to our.

Oh yeah, okay.

I mean like that was years ago, so I mean. Yeah.

Since then,

obtain your customers contact information, build your database.

Yeah, I like that tip. I want to throw that out. That was a good tip. Matt and I are going to be doing some additional tips soon as these ladies, we let them go today, but that's one of the important ones is sometimes you don't know if your side hustle going to turn into a big deal and you want to. And so for some of you out there that are like, wow, these ladies have really done a lot in the last five years, I have no idea. I think that is a great tip that Presley, you're just hitting on is let's capture every customer's information because we don't know if in the future we are going to go big. You'd probably kill for those first 10,000 customers. I mean, right? Killer. Okay, now I want to ask another question before I get into some fun ones. So manufacturing, anybody that's, you know, service related, it's going to be a different type of hustle.

Sure.

But with you guys doing products and then expanding your product line, how did you. You didn't build a warehouse and start with 10 sewing machines. You went overseas. Right. Was that difficult? Easier than you thought? Harder than you thought. What are you doing for manufacturing?

So we are overseas and it's difficult. She actually deals with the communication with China right now. But we've gone through four different manufacturers, like tons of prototypes. They send and they're still. There is still like some challenges there because, you know, you look at a small swatch that's this big and then you get the product that's this big and it looks completely different. So there's a lot of communication, not. Not just language barriers, but there's just communication is huge. That's a huge challenge in business. I feel like when you're dealing with so many different people, so many ideas of what you want your product to look like versus what they want your product, you know, they have ideas of how it should look too, strangely enough. I don't know. But yeah. Hayley, you can talk about manufacturing.

So, Haley, you speak Chinese?

You know, some days it would be nice. So I. That was kind of my. That I jumped on. I was the one that dealt with finding our manufacturers and, you know, a lot of long nights and everything, especially with the time difference. And so it took us a while to find our first couple manufacturers. They did a great job. And then there was a few, you know, few things that few snags that we came across either quality and product or just, you know, there was one time when we got. It was, I think our second order and the colors came and they were completely off, like to the point that we couldn't even sell our product. And I needed all the children's. Yeah, yeah. Presley and I, like, I Think we cried many nights together just like, what are we gonna do with all of this product? As well as like, I mean we just put all of our money into this and.

Is that when gave me 10 free blankets a year or two ago, is that. I remember that.

Yeah.

So it, it took, it took us a little bit to get through all that stuff. We finally got through it and then it just, and then we found another manufacturer and then the one that we're on now, I think he's, he's been great, easy to work with. They've been awesome. And you know, like Presley said, we still hit our bumps in the road. I mean even with our new stuff that's cut, that comes, we have to make sure we look it over and make sure everything's right. Because you know, in such a large production and like the quantities that are coming, you know, things, things do get missed and we, we like to make sure that everything is up to standard and things that we would like to receive also, you know that.

And we're gonna use it.

No, let me ask this man. Yeah, let me ask this. Like, how do you find a manufacturer in China? Like, I can't just Google that. Like I'm on a China website. Like, are there people you go to to make that connection? Do you just really go to the source of the factory that's gonna send you this stuff? Like, what's the, what's the practical process of how you did that?

Right.

And someone that's like, hey, I've got a product idea I want to make and I may make it in China. Like what would you tell them to start? How would they do that?

So to be completely honest, where we found it was Alibaba.com.

okay.

We found our first couple. We just went, we just.

The Amazon of China. Okay.

Yeah. And you know on there you can find product that's already already made. But we just doing a bunch of different research, I found a manufacturer, manufacturers on there that will create a custom product for you.

Sure.

They'll also do other things. If people are wanting to just do a side hustle of buying already pre made products and then just selling them themselves. But the other thing is with that sense, like when we first started the business six or seven years ago, that's kind of what we did was just buying things on Alibaba and then turning around and selling them again. And I think what we weren't ready for was when you have to do a custom or you want to create a custom thing, it's the quantities that you have to purchase. It's then the warehouse that you have to store everything in and things just become bigger really fast at that point. And I think we've been lucky enough to have this space that we have in my parents garage right now that keeps all of that stuff getting to the point that we're. We're close to moving out. I think we're bursting at the seams over there. So you know, I, I mean I think that Alibaba is a good place to start. There's quite a few. I mean there's a ton of. You can also choose other countries if you don't want to choose China.

There's.

You can select it by countries and then they give you manufacturers in those countries.

For those watching or listening to the podcast, at the end of this YouTube video, we're going to have a couple pictures of Presley maybe modeling her warehouse if that's okay. Get a sense of this, this warehouse facility. Okay, a couple of fun easy questions here. Now every time I think of a swaddling blanket, obviously I think of four Christmases and Vince Vaughn. Has that been helping you? You know, swaddling the baby and the importance of that is that movie.

I don't even know what you're talking about.

Yeah.

What you have not swaddle that baby. Reese Witherspoon, Vince Vaughn?

No.

Oh my gosh. That's the only time I've ever heard the word swaddle.

I've seen that movie but I don't remember that part.

It's the best part.

I don't remember it either. Yeah.

Oh, unbelievable. He's in the church and they asked him to be Joseph and Reese Witherspoon's Mary and he's like, I will swaddle this baby. There's the swaddle cloth.

Oh, I remember.

Nevermind. Unbelievable. Okay, number two, the testing. Presley, is any of these clothing Jack. Jack. Quality, fireproof type level? Are you kind of doing the Edna thing? Do you wear black round glasses when you're going through this process? I just.

That's another movie reference.

You just had an incredible movie reference right there.

See, I'm like yeah, right over.

You don't even watch Incredibles. Oh my gosh, you guys are so busy. You know what this shows us, Matt? They are hard workers. They have no time for movies. They've got a business, they got a

family, they got kids and a business.

Yes, seven kids between these two ladies and they look great. Now what's the. How have your husband's been. Have they been supportive? Are you Going to divorce them. What's more important, your marriage or the business? We come to that point yet, Mark,

ask us on a different day because it changes by day to day.

Yeah, they're pretty supportive. You know, they like the extra they

work in the business at all. Do you give them stuff to do? Are they more like you kind of like just talk through things or vent? Like how involved are they in the business with you?

I think they're definitely the like, what's that? The. The venting board. Like we're there for that part of it. Donnie helps me ship.

Adam and Haley used to ship.

So Adam helped then, but now it's up here by me. So Donnie now gets to help me with all that. Yeah.

Okay.

Well, they're pretty much just supportive and

you know, this was your chance to give them some love because they're going to probably listen to this. And I like, yeah, they're pretty supportive. What's next?

They can't have any more credit though.

That's all they get is just support. I think is kind of the. And to be completely honest, that was another reason we want kind of teetered between like growing the business was that Presley and I were like, we can't do this on our own. Whether we need to have them behind us 110% or we just need to be done with it. Because there were times when it's lots of complaining. Yeah.

And so now it's just known that they have the kids while we're doing this. You know what I mean? They have to help with kids, so we can do that.

Okay. Now, Presley, I know you and your QuickBooks master Vicki are. You know the numbers here so you don't have to share too much. So. But just generally so everybody can get maybe final question from me is what could. What. I mean, profit this year just arrange so that people can go, hey, that's pretty exciting. That's worth doing this. Do you have a goal this year? Do you mind sharing just kind of a maybe gross revenue or a net profit of what you'd hope to do this year if you just a general range.

So that's hard because, I mean, I don't know, we've done really well at explaining. Last year was spent rebranding. We didn't launch all of our new. Our website and our new products until February 24th.

So we have done way more than

we thought so far. I mean, I think our goal is probably like $8,000 this year and hopefully to move up from there.

But yeah, I mean you gotta remember

we lost momentum the last year rebranding because we were spending a lot of money and we were. And it was definitely worth it. But 80 to $100,000, I think is what we're hoping for this year.

Okay, that's great, Matt. Are you gonna go on Shark Tank anytime soon?

I don't think we have.

I don't know, Mark, if you can get us in.

Yeah, maybe they'd love you. I'm sure they gotta figure out what you want, Matt. Go ahead.

Sorry.

No. Okay. Yeah, just, just my final question is, like, what's your vision? Like, what do you want this to be and how are you trying to make those decisions on, like, you know, like, what's the long term vision of what you're trying to build?

Oh, we just. I don't think it's a good idea to look at it from. We want to just sell it, but we would just love to grow it as far as we could to eventually maybe get offered something and then maybe start something else again. I don't know. We just want to continue to grow. We want to stay in the baby and children's goods industry, and we have lots of ideas for new products and new patterns and prints and things. So I think just continue to grow, you know.

Okay.

You got to build the brand that Lemon and Loom, I don't know why it's like Fruit of the Loom, you know, it's also a fruit and a loom.

But you said that because we're actually trademarking it or trying to trademark right now with someone in one of your other offices.

Yeah.

One of the worries with the trademark

and Fruit of the Loom sells stuff in the baby area too, huh? Yeah, but it's Fruit of the Loom. You guys are Lemon and Loom, you know.

Yeah.

But we'll see if we pass. Yeah.

And then, Haley, as the kids get older, are you going to go into teenage clothing or are you going to leave it with babies?

I don't know.

I keep. I keep joking that since I just had my last baby and I'm just starting these outfits, I am a little late to the game. I either need to keep having kids or I just. I don't know. But it would be fun to eventually. We've talked about eventually expanding it into at least maybe even toddler size. But it just. At this, at this moment, we. I think we're pretty pleased with where we're at. And I think it's. It feels good to be selling again and to. And just said just to see orders Come in through our website. I think that was our biggest thing was that it just, we didn't know where any of this was going to go and we didn't know how it was going to go. And the minute we launched everything,

it

kind of just took off. And it felt good to have created a product and to also hear like genuine like reviews from customers. It's fun to see what they love and how much they love the product.

And Covid has not affected you at all?

It hasn't. It's done. Maybe it's even helped us with people just being home and shopping online.

Swaddling babies.

Swaddling babies.

People swaddle that baby.

Yeah.

That's all I have to say.

Okay.

Well, ladies, thanks for joining. We're going to check in with you in a year. We want to know.

Sounds good.

We're going to want, you know, your 10 year plan, your profit margins, everything. I'm just joking.

We'll be more. What's the word? We'll be more set for in a year. We'll have like numbers and everything. You a little bit, a little bit easier for us.

It's okay. We know this is industry private info knowledge, you know, so. But Presley, thanks so much and Haley, thank you.

Thank you. I was gonna say I had written down like Mark has been the best mentor to us and the best helper. So. No, I'm serious. Everyone needs to listen to Matt and Mark. So thank you for having us and thanks for all your help.

Thank you.

Well, we appreciate all that you guys have done and thank you.

Well, thanks for listening to the show. Well, we're gonna let you go and wrap up our. We're gonna give our summarize our four or five tips that we've kind of collected before you came on the show and with everything you've said and we wish you the best. Exciting.

Thank you.

Yeah.

Yeah. Presley, I'll be over later to get pictures.

All right, so that's lemonandloom.com you guys can go check out their products. And Mark, I'll just go, you know, I'll just hit a couple tips. I thought right off the bat that I think are important of kind of going from the side hustle to the main hustle was, you know, I think it's pretty incredible that 700 blankets sell their first time. And it's so much more questions I wanted to ask about all the detail on how they did. I think people are dying for the detail. Right? Like how do you find a manufacturer? Like how are you shipping? What Process. Are you using. What's the shopping cart using on your website? I don't know. I had a lot of questions like that. But I think it was, I think, when Presley said you have to love what you do. Like, I think a lot of people, when it's a side hustle and you've already worked a full day and then you got to do this, you got to be pretty interested and passionate about that business, otherwise, because for a while, you're not going to make money. Right. And it really is a cytosis. You gotta be. You gotta be able to like it, which I think you can tell they really like what they're doing and wanted something they would use themselves. They're proud of their products. They use them themselves. So I thought that was a really helpful tip right there out of the gate.

Yeah, I love it. And. Okay, now I'm gonna rattle off and summarize our tips from the show in an easy summarized format. This is gonna be included in an article as well. And you can, of course, watch this on YouTube or catch it on the podcast. We're not sure where you may be catching this show at the moment, but there's different forums for you to enjoy it. So let's go through the list. Okay, here's the 10. And I'm going to read them off quickly and probably in order. That, I think is a little more beginning to end. Number one, if you're going to make a side hustle, your main household, make sure you're passionate about it. We learned that from the ladies. They are passionate about what they're doing. And number two, knowing your customer, if you're going into a main hustle where you just don't really can speak the language or know who your end buyer is, maybe it's not something you want to dedicate the rest of your life to.

They were the customer, right? They knew the product that they wanted for themselves and the price point and everything like that. Really important they did.

Number three is start early, treating your side hustle like a business. Start practicing treating it like a business, and it's going to give you a big insight into what the future may hold if you go big. Matt, I love yours from the beginning of the show. Start with a business plan. If you're going to go big, analyze your competition, analyze your profit margins, your skill set, your capabilities.

Should I partner product mix? Yep, yep.

Get a strategic plan going. Matt, also, you said don't be emotional. Don't rush to quit your job and go in feet, both feet, head first, whatever Take your time but don't act rashly. And that goes with the one I mentioned earlier on too about don't rush to grow too big too quickly. There are two different things really. Acting rashly is making it your main hustle too quickly when you are not really ready foundationally to handle it. And then the other one is once you do make the jump, don't kill yourself. You don't have to be a superstar or rush. The next is get a consultation with a licensed professional. When you're ready to get formal, get some opinions from a licensed attorney of CPA that can help you do that. Next was continuing your training and study during your side hustle period. Make sure you've got all the skills you need to make the jump. When the time's right, be prepared to be a jack of all trades which is going to help in that training. And then the ladies finally in their interview said start tracking your customers early. Start that customer database and be prepared to grow by gathering data now. So there's our top ten. Matt, take us out. Any final words?

Nope. I love it. And go check out Lemon and Loom. We think grateful for those ladies to come on and share a little about their story. And of course we want you to keep listening the Refresh youh Wealth show. Make sure you're signed up for our newsletter to get updates on our articles and upcoming shows. You can do that@rejuvenyourwealth.com KqsLawyers.com, either Mark or I sites we're easy to find. You can find us online and we wanted to say thanks for listening to the show. We appreciate it and and we'll be back, of course next week with another amazing podcast.

Thanks for listening to another hour of refreshing strategies to better live your American dream.

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