This is my mind on moving (physical) products: How you move something matters more than you think
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Where I like to spend my internal company time is on team building and business models. Whenever I’m fundraising, one or (usually) both of those areas suffer.
When it comes to business models, it’s easy to copy/paste other models which have worked for other companies.
As a model begins to work for your company, and you see the revenue coming in, things start to get real. As (hopefully) customers are delighted, it’s a gaurantee that things behind the scenes will be breaking.
As things break behind the scenes here at Clayton Farms (formerly Nebullam), I remind myself that all we need to do is grow food and deliver food. If those 2 steps are completed, consistently, we’ll win.
But between those 2 steps, there are literally hundreds of focus points that we need to continue to ruthlessly prioritize. Most of these focus points with today’s model is that of distribution.
How do we go from a smooth experience for 5 subscribers, to 50 subscribers, to 500 subscribers, to 5,000 subscribers, to 50,000 subscribers?
I think it begins with understanding what you’re building.
Amazon did not build WAREHOUSES. That would mean you’d have to let everything sit until it was sold.
We don’t grow food and then find buyers for it. That would mean we operate on marginal supply, which goes against a recurring revenue business model, and it makes your sales cycle a mess.
Amazon did not build DISTRIBUTION. That would mean you’d have to ship your product to all of your retail locations.
We don’t grow food and then use a distributor to line grocery store shelves. That would mean we operate as a wholesaler which goes against our direct-to-consumer business model, and it would decrease our margins and payback periods.
Amazon DID build FULFILLMENT. That means they serve as the link between manufacturer and consumer.
We manufacture grow our food, place it into our reusable bags, and then we fulfill that order to consumer’s doorstep, just hours after harvest.
Warehouse, distribution, and fulfillment are different. They’re only interchangeable if you’re lazy.
How do you move your (physical) products?