I knew the planets were not going to completely align with starting the business and there will be lots of arising problems and trade offs that will need to be made. However, maybe I’m just feeling more cynical about things now. I have had several recent disappointments. One of the business related disappoints has come from not being able to find local vendors. Some vendors I have contacted have been incredible. Katrina from Vega, Tommy from Gnarly protein, Tyler from Equal Exchange, and Loren from Hammer Nutrition have all been awesome! I have used their products for years and believe in the ethos of their companies. Unfortunately I have had less luck finding local vendors for sourcing and larger vendors like Shamrock or US Foods have not responded to my requests.
Right now sourcing chicken, eggs, or local honey is cheaper using Whole Foods retail prices. This shouldn’t be this way. I want to support local. I want to put money into the local economy. I need to maintain profit margins. I can’t pay $.50 for an egg if I plan on selling eggs at $.50. Maybe these local eggs are superior to the advertised free range eggs at Whole Foods. I don’t know, but I do know, I can’t afford them.
Finding a lawyer has been interesting. First, I don’t understand the legal profession. You have one set of lawyers that make everything so complicated, you need another set of lawyers to decipher. This is great for job security, not sure how much value this adds to society. The meeting I had with the first lawyer ended with a $600 estimate for a lease review. I met with another lawyer. I had more trust and confidence in this person and asked for them to proceed with the lease review. The invoice for their work was considerably less than $600. Was the quality of their work some degree less than $600? I don't think so and hopefully they didn’t undercharge me. They were the ones that gave me the price so I’m hoping it was a fair price. I don’t want to take money away from anyone, but I can’t have anyone hook a vacuum up to my checking account.
I know my website needs work and formatting. Recently a local guy offered to assist. I thought this was going to be great. I figured it would be an hour or two of work to go through and change the aesthetics. I was thinking around $50. His price was $150. I know nothing about web design and what a fair price would be. I put some bids on eLance. The bids on eLance came back for around $50. Maybe this guy was going to do three times as good a job. Maybe he was estimating the job to be more than one or two hours or maybe he values his time at $75 - $150/hour. I don’t know, but I do know I can’t afford $150 for my website at this time.
Soon I’ll be hiring contractors for the demo and build out. I’m certain I’m going to run into the issues of wide price discrepancies that don’t necessarily correlate to quality. It is almost instinctive to believe high price equals high quality.* I’m not sure this is always the case as I believe some try to manipulate this instinct by charging more than a fair price. I hope the people that are doing good quality work for lower prices are maintaining profitability because these are the business that I want to continue. These are the businesses I want to find and support. Again, I don't want to grind anyone on price and take money away from anyone, but I can’t have a vacuum hooked up to my checking account.
These experiences have led me to reevaluate my priorities for the business and recognize trade offs will be needed. I want to offer high quality products at reasonable prices. I want to pay my employees well. I want to put money into the local economy by local sourcing. I think about that one rule of thumb for contracting - there is good, fast, and cheap. You can only get two out of the three. I have three priorities and right now it only looks like I will be able to support two.
My priorities for the business are: (1) provide the customers with the highest quality product at a reasonable price, (2) take care of my employees and pay my employees well, (3) put money into the local economy by local sourcing. Right now number three is going to be a distant third priority unless I can find other local vendors. I really want to help out the other businesses in the community but I have to take care of my first two priorities first. I will continue to reevaluate as I get actual numbers back from the business and determine profitability.
Last point in this rambling stream of conscience, how much of a conscience do consumers actually have? Consumers want a high quality product at a reasonable price. Does treatment of employees or community have bearing? I just watched Steve Jobs: The Man in the Machine. The movie went into some detail over the production factories in China. The factory housing areas actually installed nets to catch people trying to commit suicide by jumping out of their quarters. This doesn’t seem to weigh on consumer's conscience or at least it doesn’t seem to be a discriminator in choosing to buy Apple products. I’m feeling guilty over not being able to buy from a local farm. Hopefully I will never get to the point where I need to install suicide nets around my employee living quarters.
*Robert Cialdini wrote about this principle in his book Influence. I recommend reading.