When someone hears we do multiple millions in annual revenue, they usually assume we have many employees and a large office. We don’t have either. We are a small team of only six seven people and no office. I run the business remotely.
Two years ago things were different though.
We had an office in downtown St. Louis filled with fun, yet completely unnecessary touches. Over the past couple years I pushed us to be more lean (we cut many expenses) and more profitable. As part of this shift, we decided to take the company fully remote and streamlined processes.
I’d like to take some time to dive into the benefits we’ve experienced and then break down the architecture of the business pertaining to how we now run it completely remote. At the time of this writing this was my most requested article.
What is my business?
Running a company virtually is easier when you sell digital items, software, or services. Because after all, your product is virtual so your staff can be too. But what if you sell something that’s physical and needs to be shipped to customers?
The business I’m writing about here is Need/Want. I co-founded it in 2013 and created several e-commerce products and brands inside the company. Those are Peel, Primary Goods, Emoji Masks, Mod Notebooks, and a few smaller projects. That said, we sold off all of our brands except for one.
We are now focused solely on Peel. The below details applied to all of our companies though.
You can read about the start of Need/Want and our rocky years here.
The benefits of operating a remote company
The benefits are long and many, but my favorites are below.
Saving on costs (from obvious and non-obvious items)
First, the most obvious benefit is the immediate cost savings of not paying rent for the office we vacated. When we finished our lease there was an immediate savings of $3-4k per month. That’s a ton of money! Especially when you tally it up for 1 year.
There’s all kinds of extra costs associated with having an office too. Things like furniture, supplies, internet, electricity, cleaners, snacks, etc all add up. Without the office we no longer spend money on these things. More savings!
Less likely to leave someone out of a conversation
When we had our office in downtown St. Louis there was still about 30-40% of our staff that worked from other cities. We’ve always been open to remote work and looked for the best employees everywhere. However, with part of the team being in St. Louis and part remote, it caused some awkward dynamics. Some employees felt a little left out when decisions and conversations happened in the office without them. Conversations inevitably happen organically in person. A decision would happen and we would then inadvertently leave out 30-40% of staff on it.
When we moved to everyone working remotely we were forced to keep all communication in one place online where everyone could have their input. This behavior-shaping constraint has been wonderful for team inclusion.
No more commuting to the office
Working from an Airbnb in Lisbon, Portugal
Sitting in traffic is soul sucking. Enough said.
If our employees don’t want to commute somewhere (coffee shop, co-working space, etc), they don’t have to. They can open their laptop from home and start working immediately.
The average American spends 200 hours a year commuting to work. Without a commute, you’ve now unlocked 200 extra hours per year for family, friends, and hobbies!
Freedom to work from anywhere
Everyone on our team is free to re-located anywhere. My head of operations just moved from St. Louis to Miami because his fiancé got a great job there. I had absolutely no issues with this. 👋See ya later and enjoy the year round 70-degree weather, Brad!
We can hire the best people, no matter where they live. I think limiting your employee search to one city is bad business. Even though used to hired remotely before the switch to going fully remote, we’d still first focus our efforts locally. Now we truly hire from anywhere.
Finally, I moved abroad. I’m currently living the year overseas with my wife. I run the company from my laptop in coffee shops and Airbnbs. I’m writing this from Marbella, Spain! I have no guilt about this as the rest of my team is free to work from anywhere too. As long as they continue doing great work I don’t care where they are.
The key to operating well remotely
With time I’ve learned the key to functioning well in a remote environment comes down to respecting one thing:
Asynchronous communication
Nothing hinders productivity more than constant virtual pings and shoulder taps. When I need to be productive I put my phone on silent, hide it from view, turn off chat notifications on my computer, and close email. Only when I’ve turned off the noise can I get my tasks done.
With that there needs to be an expectation from the rest of the team that if you ping me for a question, I’ll get back to you later. It needs to go both ways too. As a manger you have to trust your team will get back to you later. Not because they’re goofing off, but because they’re busy being productive.
Asynchronous communication is sending a message or email, and not expecting an instant reply. A thoughtful reply is expected though.
When asynchronous communication is the standard, everyone on your team can do their best work.
Our tool of choice for work communication is Basecamp. We switched to Basecamp from Slack due to the difference in how asynchronous communication is handled. Basecamp has many features that support my favored style of “I’ll get to this later with a thoughtful reply”. Whether or not it is intentional, Slack’s design encourages a sense of urgency in chat. No bueno.
Note: the above communication style I outlined is what we strive for. It doesn’t always happen though. We’re human and fail at this all the time. The key is to keep coming back to good habits.
How it all happens behind the scenes
To explain the architecture of my business, you first need to understand how the business works from the customer’s perspective.
A basic flow for our customer is…
- Someone hears about our brand via a friend, a press article, a google search, or an advertisement.
- They visit our website and browse around. Once they buy something their credit card payment is processed and the funds hit our bank account within 2 days.
- Their order details are then sent to our warehouse. Within 24hrs someone picks their item(s) from our stock, boxes it up, and ships it off to the their address.
- Once fulfilled, the customer receives a shipment notification from us via email indicating when they should receive the item.
- The items are handled by a courier (like USPS, FedEx, UPS, DHL, etc) until they reach the customer’s doorstep.
- Customer gets their order from us (yay!)
If the customer has an issue or question at any stage they can reach out via email to our support team.
We automate as much as possible
There are many moving pieces to my business, but several areas are now well oiled machines due to technology and processes. Let’s go through a few.
Website & checkout:
We utilize Shopify, which handles a ton of the process needed to run the company. Hosting the website, credit card processing, and our e-commerce backend is all through Shopify. We pay a monthly fee of $299 + about 2.75% for credit card processing. Shopify starts as low as $14/mo though.
Note: we also pay for several apps built for Shopify to do extra functionality in our store. In total we pay $575/mo for those extra Shopify apps.
Warehouse & order fulfillment:
Instead of renting a warehouse space, buying shelving, and hiring a team of warehouse guys of our own to store and fulfill our inventory… we simply contract a fulfillment company to do it for us! This is a huge factor in automating the business. Our partner of choice is ShipMonk. Our inventory sits in their domestic warehouse. When an order comes in they grab our product off the shelf, box it up, and ship it out to our customer. We get better shipping rates through them too compared to fulfilling on our own.
The cost to us is a small fee per item picked & packed + the shipping rate to the customer. I highly recommend ShipMonk. We’ve been through 4 fulfillment centers and by far they are the best we’ve used.
Sign up to ShipMonk here (affiliate link) and tell their founder Jan I said hey!
Returns:
Once a customer is approved for a return, the flow is automated with software. The intake of the product is handled by ShipMonk.
Customer notifications:
All of the transactional emails for customers like order confirmation emails and shipment notices happen automatically via our Shopify software.
Snail mail:
Without an office, one may wonder how we handle snail mail. Every business has to get bills, notices, and letters sometimes. All of our non-product shipments go to an address we rent through Earth Class Mail.
Earth Class Mail is a service that gives us a physical address in any major city. Once you pick a location you use their address as your mailing address. Earth Class Mail then scans all mail for us so we can check our snail mail like email. If we ever need to get our hand on an item we can have it forwarded anywhere in the world. It’s awesome! I also use it for my personal mail while I’m abroad. We pay about $100/month for the service but they start at $69/month.
Get 50% off your first month of Earth Class Mail here (my affiliate link).
Checking my snail mail like email via the Earth Class Mail dashboard
Re-ordering product:
Starting a new production run with our factory has to be kicked off by someone on our team. However, knowing WHEN to re-order product and HOW MUCH to re-order is completely automated with software. We use a tool called Inventory Planner that looks at our sales history and then outputs quantities and notifications for when we need to order.
If you were paying attention, you’ll notice that none of the processes require much of anything from me or the team. The customer experience is well automated.
Instead, our team’s time is focused on mostly proactive work like creating new products, optimizations, marketing initiatives, and little improvements to the experience. Of course one exception to this is customer support. That’s still run by real people on our team (and always will be).
What can’t be automated is streamlined
Over the years we’ve found and added many little improvements to our processes. Some of my favorites are below.
Advertising:
We contract an agency that runs all of our social advertising. We pay them a monthly retainer plus a percentage of our advertising spend. Minus the retainer, this cost scales up and down with our advertising. I do one weekly management meeting with them over the phone. Otherwise they are expected to run the accounts smoothly on their own. We have several performance metrics in place to guide their work. Those performance thresholds are critical to streamlining decision making.
Email marketing:
We do something quite different for an e-commerce company. Instead of sending rich HTML marketing emails to our customers, we do plain text emails. Instead of only using photos, we speak to product benefits and our values in written form. Sure, there are photos sprinkled in to help communicate the idea, but written word is the primary focus of our emails. We believe this is in-line with Peel’s brand values of minimalism and simplicity.
Manufacturing oversight:
Our products have to be produced in a factory in bulk. There’s no way around that. However, once they’re designed and finalized by us, the manufacturing, quality control, and assembly with packaging is now overseen by a firm we contract. It didn’t use to be this way, but now that we’re at a larger scale this was necessary. There are still headaches that I have to handle sometimes though.
The Front inbox
Customer support:
As I mentioned, we will always have humans behind the scenes to reply to customers. We employ a full-time staff for this with its own leader to handle the edge-case issues that inevitably bubble up. This cuts down on my in-bound as the CEO. To help streamline the work for the team, all communication channels are piped into one place using Front. Inside Front we further split things up by issue – returns, product issues, general questions, and urgent messages all get their own inbox. The team can batch and split up the work based on priority and scenario. We also have well thought out canned replies for the most common issues.
Photography:
Special projects like photography and video shoots require outside contractors. We choose creatives that fit the style we’re going for. Interestingly, we’ve been able to streamline a lot of content creation for social media by working with select influencers. We get social media content and great lifestyle photos from smaller influencers in exchange for free product. Additionally, for website photography we’re going to be testing out a service called FeedSauce to help streamline some of our studio product photography needs.
When we went remote, many things in the company were just “business as usual” without any changes needed. However, it’s been fun to seek out creative solutions to the quirks of being remote.
Tradeoffs
Okay so it hasn’t all been perfect. Occasionally we run into issues where it would be nice to hash it out in person. We can still pick up the phone or do a group video chat to collaborate live in those situations though. The rare pain point is completely worth the long list of benefits.
Receiving product samples:
Something that is a bit more difficult with being remote is getting my hands on pre-production samples. When we’re designing and developing a new product, I need to touch and feel samples.
Moving around and being abroad has made it more difficult to receive stuff. I can definitely receive shipments, it’s just slower. Before when we were all in the same office I could receive a pre-production sample and call everyone into the conference room to test it out. I get around this issue by just paying extra for a few more samples and shipping them to everyone on the team.
“Water cooler” chats:
With the work style I outlined, conversations around hobbies and interests between colleagues are a little bit more difficult to happen naturally. A few things help with this:
- We all usually greet each other in the mornings in our company chatroom before we start our day. It’s a nice friendly start.
- We have a few weekly and monthly prompts that get asked openly to everyone in Basecamp. Things like: “What’d you do over the weekend?”, “Read any good books lately?”, “Were you inspired by anything lately?”
- Living interesting lives in a variety of places is the best social lubricant. We now have a team that’s quite diverse in background, interests, and location. I find this to be the best recipe for fun conversations between colleagues. There’s always something interesting to learn about each other.
You should go remote too
I think remote work is the future. I would encourage anyone to adopt remote work life for the many benefits. The downsides are shrinking everyday. New tools are being released all the time to make it easier to run a remote organization. The good news is you can be a company of one or one thousand and enjoy the same benefits we’ve experienced.
As you may have noticed, what makes all this possible for me are the products I sell – unique physical products we invented. They’re the foundation of my company.
If you’re interested in inventing & manufacturing a physical product of your own, get my book for free below. It will take you though the process step-by-step.
