How this entrepreneur bought a successful ecommerce site (and made it even better)

Could you tell us a bit about yourself, what you sell at Color My Slime and how you got started?

I’m new to the ecommerce game, having recently left a full-time corporate job in finance to pursue a few entrepreneurial projects. My current day job is to help run a small private equity fund that acquires and grows software products.

Color My Slime is my first venture into ecommerce, and I acquired the business from the original founder in December of 2017. Color My Slime is a well-known brand that sells a variety of pigments across 75+ SKUs for use in DIY slime projects.

For those who haven’t heard of slime, it’s an arts & crafts / toy product that is made by mixing together glue, water, and activator, which eventually forms a viscous, slimy, squishy substance. Color My Slime sells glow in the dark, color shifting, and glittery pigment that folks can add to their slime to “dress it up”.

The first version of a slime product actually dates back to to the 70’s but it has regained popularity by bounds. In fact, in February of 2017, believe it or not, the slime craze drove an Elmer’s glue shortage across the US. If you search #slime on Instagram, you’ll find a whopping 3 million #slime postings, and counting.

That’s pretty incredible! You mentioned having purchased the site from someone else. What was that experience like? Any advice for others thinking of acquiring an existing site?

I wanted the full experience learning the ins and outs of an ecommerce store. And what better way of learning than by doing? So, I purchased the store off of Shopify Exchange. My criteria to find a suitable target to acquire was very simple:

  • Niche product (aka. Minimal copycats)

  • No dropshipping (I wanted the logistics experience and saw full control as a cost-reduction opportunity)

  • Limited competition

  • Established revenue of 6+ months (since I was acquiring a business, might as well make sure product/market fit is already confirmed)

I did not know anything about slime at the time, but the store checked the boxes for my ecommerce experiment. Only 2 weeks after identifying the store off of Shopify Exchange, I was packing the inventory into my rental car, handing over a certified check to the original founder, and starting the drive back home with a new business.

What did it take to get your first products in stock? Has that changed since you started?

I was able to extend the contract with the supplier who had worked with the original founder.

But I still wanted to see if I could reduce costs by finding additional suppliers. After some research, I finally found a couple of suitable and affordable US wholesale suppliers. Just like that, I was able to increase profits by ~20% by reducing my raw material costs.

I try to keep things fresh for existing customers by adding new SKUs to my inventory. I’ve turned it into a fun contest with our fans: I post an up-and-coming pigment, they provide suggestions for the name, and the winner gets a sample of the pigment for free.

That sounds like fun! How did you get your first sale as the new owner?

My primary marketing channel is Instagram. Instagram seems to be an optimal stage for slime fans to show off videos and pictures of their slime creations. Color My Slime has 30k followers on Instagram and maintains partnerships with several of the most followed “silme celebrity” accounts.

I also started a blog that quickly gained traction because there is minimal long form content on slime. After a couple months, the blog was getting 10,000 organic views per month.

What obstacles and challenges have you overcome along the way?

A couple months ago, I began a campaign to launch our products into brick and mortar retail stores. I reached out to dozens of toy stores, hired a designer to sketch out retail packaging, and prepared the initial batch of products.

The process is in early stages, but retail is a whole different animal. While there are long-tested ways of getting in touch with consumers through ecommerce channels, retailers all seem to enforce unique criteria before they will even consider a relationship.

What influenced your decision to use Shopify?

I was familiar with Shopify because I’ve worked with Shopify apps before. It was so easy to set up a store and they have so many tools available to help you--everything from a friendly UX for web design to thousands of marketing apps--and they’re all Shopify-approved.

It almost seems like if you can dream up a feature to help run things on your store, chances are it’s already an app you can find in the Shopify App store.

What was the process like to get started? Is there anything you wish you had known then that you know now?

The first week was a scramble to set up shop while orders were coming in and needed fulfillment. This required me to wear lots of hats: researcher (tracking down the right thermal printer), logistics manager (picking carriers, preparing the warehouse), designer and developer (redesigning the website), accountant (setting up a P&L), and many more.

Unless you are ready to outsource and hire--which is unlikely if you’re just getting started--you’ll end up taking much of this on yourself.

There are hundreds of decisions to make when you set up a new venture. Ironically, this is also when you have the least amount of knowledge, which can be paralyzing. If you’re an indecisive person like I am, you’ll have to force yourself to make choices quickly and firmly.

I also made a point to set up automated processes and documentation whenever I could. The extra effort in the short term will pay off in spades in the long term.

What Shopify apps do you currently use? Which apps are most important to your business and why?

Fomo, Cross Sell and Shippo are my top 3.

Fomo relays the feeling of a busy store to a customer, with notifications showing all of my activity, including new Instagram posts, new sales, other customers adding items to their carts, etc.

Cross Sell provides customers with add-on suggestions before checkout, which works well for Color My Slime, since mixing complementary pigments together is popular in the slime world.  

Shippo is my fulfillment app, and generates shipping labels with discounted shipping costs, tracks orders, and sends shipment notification emails to the customer.

What theme did you choose for your site and why?

Shopify’s Minimal Theme. My key demographic is teenagers and young adults who love arts and crafts and spend a lot of time with Instagram filters, so I wanted something modern with a tinge of sophistication.

What strategies have you used to attract more leads and grow Color My Slime?

Built a following on Instagram and Etsy, spent time accumulating SEO juice (Color My Slime ranks #1 on Google for “slime pigment”), spun up a slime blog to get 10,000 organic hits a month, worked with Youtube and Instagram slime influencers to showcase our products, and led a few fun “contest” marketing campaigns to generate goodwill and buzz.

What are some of the most effective ways that you interact with your customers?

I interact with my customers almost exclusively on Instagram.

Are there any metrics you can share in terms of order volume, monthly sales, increased revenue, growth %, etc.?

We are currently processing >40 orders per month. I’ve always focused on the bottom line, so with the combination of cost reduction and revenue growth, our profits last month were 80% higher than what we generated the previous year.

To what do you attribute those positive metrics?

Staying in front of our key demographic through fun contests, influencer partnerships, and new product introduction.   

What are you working towards now?

Actually, I recently made the big decision to travel the world in one year. Since I won’t be able to carry physical inventory while traveling (I’m even switching to a capsule wardrobe!), I have decided to sell the Color My Slime business and focus on my software projects.

I just started the sale process but given my deadline (I’m heading off to Asia to start the world tour in January of 2019), I’ve cast a wide net. After preparing my sale materials, I submitted several inquiries to website brokers familiar with businesses my size (Flippa, Empire Flippers, Acquisition Station, Shopify Exchange Marketplace, Side Projectors, and more).

I also cold-emailed businesses I identified as potential buyer candidates. For example, other pigment distributors would be able to take advantage of a complementary supply chain, raw material volume discounts, etc.   

I am optimistic about finding the right buyer who can continue growing the business to its full potential. Given the fact that I currently do not spend a dime on marketing or advertising (beyond occasional free products to certain influencers), I know there’s plenty of room for Color My Slime to grow with the right buyer.

Are there any blogs or other resources that have been helpful for you?

I’m a member of the Shopify Entrepreneurs Facebook group, which is a community for Shopify store owners to share stories, ask questions and provide advice.

Otherwise, I like to read and the latest book I’ve added to my collection is “Blue Ocean Strategy”. The book is about carving out a new marketplace for your product or service that is untouched by existing competition. If you are thinking about forming a business idea from scratch and don’t know where to begin, this is a great start to sketching out your business plan.

Based on your own success, what advice would you share with others who might be just starting out with Shopify (or with eCommerce in general)?

I put myself in the “just starting out” camp, but I’d suggest figuring out a way quickly to spend most of your time working *on* the business versus *in* the business. The day-to-day of order fulfillment, customer service, and inventory management can take up all of your time if you let it, but these activities likely won’t help you generate more sales. Take care to split your time between revenue-generating tasks and maintenance tasks.

Where can we learn more?

Our store is https://colormyslime.com. You can also follow us on Instagram @colormyslime, as well as Facebook and Twitter. If anyone is interested, our sale listing can be found here.

~ Hideko Tachibana, Owner of Color My Slime

 

 



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