163: Why a Subscription Box is a No-Brainer for Your Product-Based Business

Hey, it's Sarah, and I want to make sure you have a special invitation to Subscription Box Week. It only happens once a year. It's only $15, tons of fun, and a way to jumpstart your subscription box journey. I'm going to help you get clear on your ideal customer, help you curate several subscription boxes, and I'm delivering a brand new training to elevate your subscription box business. It's a jam-packed week of learning and fun with tons of subscription box owners. Head over to subscriptionboxweek.com and get signed up. The fun starts June 23rd. Do you wanna level out your revenue, create consistency, and put an end to the feast and famine cycle of one-time product sales? Do you want to add stability to your business that allows you to cover payroll and overhead expenses? Do you want to relax knowing the inventory you're buying is already sold? If all of that sounds too good to be true, come join me for this episode.

Welcome to the Launch Your Box podcast with weekly tips, tricks, and strategies to start, launch, and grow your subscription box. Now here's your host, Sarah Williams.

Welcome back to the Launch Your Box podcast. If you listen to the podcast regularly, you already know how much I love having a subscription box. But let me take you back to the beginning and how I turned my existing product-based business into a subscription box business. Let's just go through a couple scenarios here. Let's talk about the life of a product-based business owner, and this was so me. If you're a product-based business owner right now, I'm almost certain you can relate to this. Okay, so here's how this scenario goes. You spend lots of money ordering product or manufacturing product. You wait for it to come in. You create content, meaning pictures, copy. You go live. You send emails. And then you hope it sells every day. One day you can be like, yay, I got 20 sales today! The next day, crickets. And this can affect your mood, it can affect your energy, it can really affect your finances and your stress levels. That's the day in the life of a product-based business owner. Now picture this: You still spend a lot of money ordering or manufacturing product, but now it's for your subscription box. You wait for it to come in and payments hit your bank account automatically. You pack it and ship it. Now you go create your content, go live and send your emails. You get some new subscribers each month and you rinse and repeat. You don't have to show up every day. You see this— having a subscription box can really reduce the stresses of your business. Now let's talk about some of these stresses and how it can really change things. And if I've got your attention with the day in the life of a product-based business owner and then a day in the life of a subscription box owner, you're going to start to see a difference. And you may think there's not really a difference, you're still selling product, but it is different. Because it's recurring. So let's talk about stress number 1, and this is probably the number 1 stressor of every single product-based business owner out there: sales and revenue. It's no secret that most product-based businesses, they either feast or they famine. You either have a great sales day or it's dead the next day. When I show up and I sell my face off, I'm gonna have a good day or possibly even a good week. But what happens when I take a vacation? Or what happens when I get sick? I just had a surgery and I had to take 2 and a half weeks off. What happens then? Or maybe I just need some time off for my kids or my parents or my family. Sales drop every single time. You'll see a drop-off. I can look say, at last year's sales, and I could say, oh, sales were rough that month. Oh, you know what happened? This happened that month. And it's a direct reflection of what's happening in my personal life. With a subscription box, you show up one time and you sell it one time. That's it. It's an incredible feeling when those payments hit your bank account every single month without having to show back up for them. First, number one, sales and revenue. How can we level that out so it's not a giant roller coaster every single month? Stress number two, managing your product costs and inventory. You're spending your money on products that you love, but with a subscription box, you don't have to guess on how much to buy, when to have it shipped, or wonder if it's actually going to sell. Because it's already sold inside your subscription box. One of the best things that we can do with our boxes is manage our inventory so much better as a product-based business owner. So I had a gift shop prior to my subscription box, and I would go to market and I would buy products for my shop, and I'd be like, oh, that's so cute, that's gonna sell, let me get X number of those. And There it sat on my shelves not selling. Or I would look at something and I would buy a little amount of them not knowing if it was going to sell. And they were hot sellers and I was sold out so fast and I couldn't replenish it because the wholesaler didn't have any more. It was always a guessing game. Like I literally could have taken a dartboard with me shopping and say, okay, how much of this should I buy? 40 pieces. How much should this— of this should I buy? 400 pieces. I never knew. It was always a guesstimate. And then you've got markdowns if it doesn't sell, and then you've got your dollars tied up in all this product that's sitting on your shelves. When with your subscription box, you can plan out your numbers, you can decide when you're going to increase your numbers, you can keep them the same for several months at a time so that we know what's going on. You can manage your product costs and inventory, and that is a huge stress in a product-based business. So that's stress number 2. Stress number 3 is really planning and budgeting for growth. Let's face it, our goal as a business owner is to grow, period. But it's hard to plan our advertising budgets, figure out staffing, and really grow our business when we don't know what's going to happen from month to month. Having recurring revenue with a subscription box really stabilizes your business. You can manage staffing and payroll because you have consistent work for your staff. You could advertise more because your acquisition cost in getting a recurring customer is different than just a one-time customer. See, when I have, say, a $20 acquisition cost on getting a subscription box customer, I only have to pay that one time. But when I have a $20 acquisition cost in selling a tote bag, I'm going to have to keep paying that every time I show up and sell a different item. You can advertise more because you only have that fixed cost one time and you have a recurring payment month after month after month. You can plan for growth by increasing your numbers periodically throughout the year and not guess at what you're going to sell all the time because it changes from season to season, it changes from month to month. But you can really plan for your growth when you have a subscription box. Now here's the bonus. You've got these 3 stressors. Stress number 1, sales and revenue. We're always stressed about sales and revenue. Stress number 2, managing product costs and inventory. It's a constant worry for product-based businesses. Stress number 3, planning and budgeting for growth. We have to continue to do that, and sometimes we just don't know how to do that because we haven't stabilized our business. We don't know what to expect. But here's the bonus to all of this: you've already built your audience. Audience building can be slow and difficult for someone that's just starting a business, but if you're already selling products, you already have an audience. Let's talk about me when I started. I told you we were going to go back to the beginning, so I had a brick-and-mortar shop for several years before I started my subscription box. I was a gift shop and I specialized in personalized gifts. That's where my monogram box came in. I already had this great local audience and it was from word of mouth. It was from me doing holiday shows. It was from my social media accounts, but it was all local. And so when I started my subscription box, You know what? I had all local subscribers. Every one of my subscribers was within 100 miles of my shop. It was someone that had a relationship with me. It was someone that bought something at one of the holiday shows that I had set up a booth at. It was someone that had come into my gift shop to buy something from me. They were all local to me in some way. And that's how I started my subscription box. I had an audience. I had a local audience, but I had an audience. And when I started my subscription box, I had that audience to start it, and then all I had to do was to figure out how to grow online. But because I had this audience, I was making recurring revenue right out of the gate. It started off with 44 subscribers, and then that turned into 100, and then that turned into 300. And I had about 400, 450 local people that were getting my subscription box, and over half of them were coming into my shop to pick it up. So not only did I have recurring revenue from their subscription box every month, but now I had guaranteed foot traffic into my shop every single month that was generating more sales for me. You can't buy that kind of foot traffic, and they were paying me to come in. They were paying me for the subscription box, And then they were walking through my front doors to come pick it up. And oh, you know what? They found another shirt they liked. Oh, you know what? They found a cute necklace or bracelet set that they wanted while they were there. Oh, you know what? I need a gift for so-and-so's birthday next week. I'm going to go ahead and get something while I'm going to pick up my subscription box. And that's how it started. I had a healthy start. Those local customers fueled my box number. While I was learning to grow online. We never stop audience building, ever. I have never stopped audience building, and I don't ever want you to stop audience building. But the good news is you already have a start if you're already selling products. So if you're listening to this and thinking, oh, I need this, Sarah's right, I need to have a subscription box in my product-based business, Let me help you with the next question. And this is the next question after, should I have a subscription box? And then I reassure you, you should. Now the next question is, what should I put in my box? Here's the best part, because as a product-based business owner, you already have an advantage over brand new businesses. I just told you, you have an advantage with your audience. You already have an audience. You already know who your ideal customer is because they buy from you all the time. I knew who my audience was, and because I had a physical location, I saw them come in every month. I could see what they were buying. I could see what they were repeat buying. I already knew their pain points. How did my products solve their problems? I don't have any needs in my gift shop. I only had wants. But the benefits were that they could get something custom and personalized that they couldn't get by going to Target or Hobby Lobby or wherever big box store that they were shopping at. They knew they could walk into my shop and get a custom personalized gift for someone or get something custom and personalized for themselves. That was the pain point. They wanted to get something meaningful. So now if you think about your own customers' pain points, what are their pain points and how can you solve them with a subscription box? It's time to decide the products your customers would want to see in your box. So I want you to ask yourself these 3 questions, and if you're listening and you're making notes, just jot these notes down. So the number 1, what are your best-selling products? So when we go back to Sarah Williams starting a subscription box. I looked at my top 4 categories in my store. Number 1, graphic tees were always selling every day. Number 2, along with graphic tees, were accessories and jewelry. Number 3, bags of all kinds. I'm talking crossbodies, purses, tote bags. If you needed a bag, I had it and I could monogram it for you. And then number 4 was drinkware. I was selling tumblers, water bottles, mugs, all kinds of drinkware. So I took those 4 categories of my best-selling products and I created a subscription box around it. And then I want you to ask yourself, what do my customers buy repeatedly? What do they come back to get? And for me, that was a lot of seasonal stuff. Okay, so I would see my customer and they would want something cute for 4th of July, and then they would want something cute for fall or Halloween or Thanksgiving or Christmas or Valentine's Day. So it was very seasonally driven. So I knew I had to incorporate that into my subscription box because they were repeat buying. They bought something now for 4th of July, they needed something else for fall. And so I was very seasonally themed and driven in my shop. In every product category. And then what do your customers consume and want more of? And when I say consume, it can be a consumable like a lotion or a food item or something that they're going to use up. Or when I say consume, I'm like, what are they using and what do they keep asking for more of with you? For me, it was graphic tees. They wanted more graphic tees from me. They loved the designs that I was creating, the inspirational tees that I was making, and they wanted more of them. And they would always ask about, when are we going to get another tee? When are you going to have another collection come out? And so I took my best-selling products, I took what I saw customers repeat buying, and I was listening to what they wanted more of when they would come in my shop. And when you think about those 3 questions, you probably are already like, wheels are turning in your head right now of what you could do for your own subscription box. But a great way to go deeper with this and really flesh out some of your ideas is to come take my free 6 in 60 workshop. In this workshop, I guide you through planning 6 months of boxes based on that ideal customer. Once you visualize this for yourself, you're ready to start taking action. So think about you sitting down, taking this free workshop with me, and listening to the way I brainstorm. And I, I do this exercise every time I plan out boxes. And so this isn't a one-and-done. This is something you're gonna— it's gonna create a habit for you. It's going to create a system and process for you for really thinking about your, your subscription box 6 months at a time. And once you kind of lay out those 6 months of boxes and really dial in what this could look like for your business, you're ready to take the next steps. The problem is we sit and we listen to podcasts or we watch a Facebook Live and we're like, yeah, I really should start a subscription box. And you might lay in bed at night dreaming about what you would put in it and how you would make it cute. And that process could go on and on forever, endlessly. It could go on nonstop. It went on for me for a year, over a year. I would think about my subscription box. I would lay awake at night thinking about what I would put into it, but I never put those plans on paper. I never made that visual step that I teach you to make in Six in Sixty Workshop and really lay it out month by month. Because when you can lay it out the way I teach you, you're going to be like, oh, I can do this. I see this now for what it fully is. I have fleshed out all these ideas that maybe have been spinning around in my head, and it's on paper, and now all I have to do is execute it. That's what I'm talking about here. How long have you been thinking about starting a subscription box? Maybe it's a new idea for you, but maybe, maybe you've been thinking about it for months or even years. Go over and find my free workshop. It's at 6in60workshop.com, and the numbers are numbers, they're not spelled out. So the number 6, N-I-N, 60, and then workshop.com. Go take that and really just take an hour for yourself. Close the door in a quiet room, listen, watch the video, and lay this out for your business. Because you're already almost there. If you're listening and you have a product-based business, you're selling products regularly, you know what your best-selling products are, you know what customers are repeat buying, you know what your customers are asking you for more of, you know who that ideal customer is, you know what their pain points is and why they shop with you. What would your business or even your life look like a year from now if you had 100 subscribers? For me, 100 subscribers meant that all my overhead was paid for in my building, in my shop. It was my rent, it was my utilities, and it was my one employee at the time. It was her paycheck too. What would 100 subscribers do for you? Do the math. If you were going to price a box, say, $45 times 100, what would $4,500 a month do for your business? What would 500 subscribers do for your business? Or even 1,000 subscribers? What if you created $45,000 in monthly recurring revenue? How would that change your business? How could it change your life? Because it could change everything. Let's get started building recurring revenue that will pay you well month after month. Make sure you subscribe to the Launch Your Box podcast. I'd love for you to take a minute to rate and review it. Let me know which episode is your favorite so far. Don't forget to join me next week right here.