Welcome to Chez Cliff!

The economy is in danger.  Another great depression.  $850 billion to save the world blah blah blah.

Everyone can agree that people are saving money, rather than spending it.  Companies work hard and spend lots of money to try and convince us otherwise.  Some companies make it difficult, despite what their CEO’s may say, to actually give them money.  Dell, for instance.  But I found a small company, a restaurant nonetheless, that made it just as difficult.

We were eating our lunch, which was Pho.  For those who don’t know, Pho is a great Vietnamese soup.  Perfect for those days that you’re not feeling quite up to speed.

The first indication that the meal was going to end badly was when the bus boy asked if he could clear our plates.  While we were still eating.  It’s not that we were sitting there, talking without eating.  We had spoons in hand, sucking on soup when he approached.  A quick dismissal and we were back into our meal.

The server came around when we finally had finished.  Now a question for you:  What is the first thing the server asks at the end of your main course?  If you said “Do you have any room for dessert?” then you get a gold star for the day.  Our server didn’t ask us this question.  Instead, she promptly slapped the bill down and walked away.

OK, general confusion.

A few minutes later, I finally got her attention.  We wanted desert.  I wanted coffee.  So we asked for a menu.  The look on her face was of pure astonishment.  It was the equivalent if I had asked her to give me her kidney.  When it finally computed what we wanted, nearly 30 seconds had passed.  

When we got the menu, we decided on the chocolat au pot along with some vietnamese coffee.  Fifteen minutes later, we were fed up with being ignored and just left.  Then the server decided to show us some attention but only enough to verify I had left enough cash to cover the check.  No, I didn’t leave her 15 percent.

In this economy, you would think the owner of the restaurant would be driving home the point that upselling is key.  Every server asks “Did you save room for dessert?”  Every one!  And when the customer asks for a menu to order dessert, guess what?  The check just increased at least $10 which means an extra $1.50 in tip.

As my hand grasped the door, I did a quick glance around the restaurant.  Nearly half the tables were empty.  But the message was clear: no return visit to this restaurant.

I’ve never claimed to be the smartest person on the planet.  I do however learn quickly.

I reported out the conversion rates in January for the first few months of the business.  Then I realized those conversion rates are really meaningless.  The whole point of the exercise is to show an increase in sales.  I can’t do that through conversion rates.

So we’re going to talk about the number of units sold.

For the time being, I’m tracking my results on a weekly basis.  World Sales and US Sales.

Week 8 and Week 11 show two huge dips.  Week 8 was the release of our 1.1 software.  We reset the release date which temporarily took our application off of iTunes.

Week 11 was a freeze on all my accounts.  My personal account was changed over to a corporate account.  All my contracts and banking information had to be re-verified . . . which it was in record time.

I did notice that the average for Weeks 4 through 8 were lower than for weeks 9 through 11 (and 13).  Besides the release of new software during week 8,  something unexpected took place.

Reviews.  Within a week timespan, I got a few additional very good reviews.  The people, who I did not know, left positive reviews and I believe this is what caused the bump.   Another review trickled in during Week 9 and this may have sustained the sales.  I’m not sure.  But it’s hard to ignore the coincidence between good reviews and a bump in sales.  The only way I’ll know for certain is to continue and monitor.

But without spending a dime on advertising, I’m quite happy with the results.

I’m continually searching for ways to reduce my expenses.  Because I have this weird notion of “quality of life” – I refuse to live like a pauper just to save a buck.  When looking at Colgate toothpaste at the store, I have a hard time buying “Miguel’s Teethpaste: Now Semolina free” just to save 50 cents.  But a few weeks back, I was introduced to something which has already paid for itself in spades.

In college, I went to a 99 cent store and was disgusted.  It was stacked to the ceiling with paper plates, paper cups, plastic wine glasses . . . a complete underwhelming experience.  A few weeks ago, a friend convinced me that the 99 cent store was completely different.

I was stunned.

• Ralphs: two tubes of colgate toothpaste with coupon:  2 for $4.  The dollar store had the exact same tube for $1 (or 2 for $2).  50% savings.

• Whole Foods:  a head of romaine lettuce is $1.69.  Dollar store had two heads of Romaine Lettuce for $1.

• Chips and Sales (Pace Picante) for $2 total.  Ralphs wants $6 for the two.  WholeFoods wants $8 for both.  And the salsa ($5) from WholeFoods is horrible.

• Albertsons:  $4.29 for a Colgate toothbrush.  The same is $1 at the Dollar Store (which includes tongue cleaner and kung-fu grip handle).

Granted, not all dollar stores are created equal.  I checked out a few that were downright creepy.  But the gems are well-worth the hassle.

Doing my bi-weekly run for the necessary staples of living life, I placed my 7 items on the conveyor belt.  Mentally prepared for the $35 charge to my wallet, I was pleasantly surprised when the lady said “That will be $7.49.”

Doing this two or three times a month, the savings of $25 per trip will be put to good use.

This is a story most of you probably heard by now.

A few months ago, a major corporation posted a simple challenge on it’s website:  Make a commercial for us.

Internet competitions are nothing new.  Companies give away gifts all the time.  My own company is giving away an iPod Nano.  The results are having people perform some kind of action.  The bigger the action, the more the reward.

In this case, the company declared the winning commercial would get $1 million dollars.

Two unemployed guys decided to give it a try.  With a budget of zero dollars, they found actors in their friends and family.  They managed to find an office where they could shoot for free.  Their biggest expense was providing food for the actors.  On eBay, they found a cheapo vending machine.

The results was the top rated Super Bowl commercial this year.  And my personal favorite.

It never ceases to amaze me how the winds of fortune can change overnight.

For my corporate checking account, my next step is to get a line of credit.

Up until this point, the financing for my venture has come on my credit cards.  The costs were spread out over time, allowing me to pay down the balances to the point where another item could be purchased or financed.

Now we are gearing up for a big release of our software and, of course, that involves financing.  In setting up the corporate account, my goal is to shift the debt load from myself and onto the corporation.  That way I can use the proceeds to finance the corporate debt and I can focus on getting rid of my own personal debt.

The Small Business Assocation (SBA) only does loans for a minimum of $25,000 and a good portion of that must be collateralized by the stock holders.  First off, I don’t need $25,000.  If I did get one, I’d have to collateralize at least 80% (or $17,000) before I could get the loan.  Well shoot, if I had the $17,000 then I’d go ahead and do this project myself with taking out a loan!

No, the trick is to get the business to finance it’s own debt.

Wells Fargo has micro-loans, starting at $5,000 and those don’t require collateral.  If the entire $5,000 was taken out, the monthly payment would be $100 per month.  So the business has to make at least $100 per month to carry the debt.  Fortunately the business is doing much better than that.

By opening a loan, the business begins to build it’s credit.  Much like any person building their credit score, businesses operate on the basis of good credit.  As we exercise good judgement in controlling our expenses, building our sales and utilizing the credit wisely then we can start getting access to bigger funds.

Then we can do some cool things.  Hehe.

To get Banker on board, I sent her a free copy of our software.  It never hurts to grease the wheels.