Commerce Chronicles 006

Wow, y’all really loved the last Sunday Stories. In case you missed it, we did a deep dive into ODDITY Tech’s entire business in context of their recent IPO. Their listing was at $35/share and upon IPO jumped to $48/share. IDK about you but that’s pretty baller. 

Here’s a quick highlight:

• Their business financials are incredibly solid at 70% Gross Margin and 17% Adjusted EBITDA

• They invest heavily into product development and tech

• They run aggressive quiz funnels and trial programs for acquisition

• They use all the data they capture to launch new products and brands

Business breakdowns are a new format we’re testing and we’d love to get your feedback on it. Vote on the poll below to help us out.

Let’s get back to bizness 🫡 

In today’s email:

• HOW SHOULD YOU INVEST YOUR CASH? UNDERSTANDING ROIC

• TRUE CLASSIC TEES’ TRUE GROWTH SECRETS

• SCREENGRABS OF THE WEEK

• BRAND OF THE WEEK

If you were sent this issue, join the most on-the-ground community in e-commerce and subscribe:

SALES TAX IN ECOMMERCE IS THE WORST

You started your company to sell products, not to navigate the complex maze of sales tax. If you're like most ecommerce entrepreneurs, you're probably spending countless hours trying to understand your sales tax obligations in each state. Current solutions just aren't cutting it.

What if I told you there was a way to simplify this entire process, keeping you fully compliant with a white glove service?

Introducing Numeral.

Numeral is a white-glove service designed specifically for ecommerce entrepreneurs like you. Their team of experienced ecommerce operators and licensed CPAs have felt the pain of sales tax compliance firsthand and have developed a solution to take this burden off your shoulders.

Here’s how Numeral helps you:

• They do end-end sales tax filing. You just plug your Shopify and Amazon stores and they’ll take it from there.

• Through virtual mailboxes, they can receive, read and reply to official correspondence from the states that might be important.

• They continuously monitor nexus across states, thus keeping you compliant at all times.

Want to know the best part? Numeral is offering Commerce Chronicles readers a FREE Nexus Study.

This comprehensive analysis, typically a high-cost service, will identify where your business has a sales tax obligation. It's a crucial step in ensuring sales tax compliance and can help you avoid hefty penalties and interest for failing to meet your tax obligations.

In just five minutes a month, you can handle all your sales tax needs with Numeral. They’re the trusted partner you've been looking for, run by ecommerce operators and CPAs who understand your challenges and are here to help.

Click here to get started with your free Nexus Study. No credit card required, just a commitment to making sales tax compliance easier for your business.

HOW SHOULD YOU INVEST YOUR CASH? UNDERSTANDING ROIC

In a recent podcast chat, Mike Beckham from Simple Modern and Dave Rekuc from Bambu Earth tackled a big question: "What do I do with all this profit?" They chatted about smart ways to put money back into your business, focusing on Return on Invested Capital (ROIC).

They covered stuff like investing in new products, listening to customers, and balancing business growth with enjoying life. They also talked about keeping your brand strong, adding new products, and making the most of extra cash. It's a great listen for anyone looking to make smart business moves and grow their company.

Key Lessons From The Episode:

1. Understanding ROIC: Recognize the power of this key metric in evaluating the efficiency of your company's investments. High ROIC can lead to increased investor confidence and company valuation.

2. Investing in Product Development: Appreciate the strategic value of investing in product development. Starting small to test the market response and manage risk can drive growth and increase revenue.

3. Listening to Customers: Embrace the importance of customer feedback in guiding your product development. Making customers the center of your product development process ensures your product meets market demand.

4. Balancing Growth Strategies: Understand the balance between marketing and creating products that inherently attract customers. Organic growth can be a strong indicator of a product's market fit and potential for success.

5. Considering Quality of Life: Acknowledge the correlation between your personal happiness and business decisions. As an entrepreneur, your quality of life should be a factor in your decision-making.

6. Maintaining Brand Value: Recognize the importance of aligning all business decisions, including investments and product development, with your brand's values and image. Enhancing and maintaining brand value can contribute to your long-term success.

7. Diversifying Product Offerings: Appreciate the value of introducing new products that align with your brand. Diversification can drive growth, increase revenue, and reduce risk by not relying on a single product for revenue.

8. Using Excess Cash Strategically: Understand the importance of investing excess cash back into your business to drive growth, such as through product development or acquisitions. Holding onto excess cash may not be the most efficient use of your resources.

9. Understanding Market Demand Before Launching a New Product: Recognize the importance of research, surveys, and testing in understanding market demand. Launching a product that meets a clear market demand can increase your chances of success.

10. Finding Your Edge in Creating Better Products: Embrace the importance of learning everything about your customer. You don’t have to build the tech yourself, but their obsession over creating this edge for their business is boding well.

TRUE CLASSIC TEES’ TRUE GROWTH SECRETS

LOL this is another podcast summary but it’s too good not to share. Nik and Moiz chatted with Ryan Bartlett, CEO of True Classic which is bootstrapped, profitable, and hit $150M in 2022.

Nik also shared some key lessons in this Twitter thread. The biggest highlight from this thread to me was about using Profit ROAS to drive paid ads performance.

The second biggest standout was that True Classic is running 450+ ad creatives 🤯 

The podcast episode is pretty solid listen as well! But I know you all are busy so I had them summarized for you below.

Here Are The Summarized Lessons:

1. Be Intentional In Every Aspect: Ryan and team would go above and beyond to overdeliver for their customers. Even going so far to give surprise gifts.

2. Promote Your Products Passionately: Develop marketing strategies that reflect your genuine appreciation for your products. This can help build a loyal customer base.

3. Analyze Successful Business Models: Regularly study successful businesses in your industry. Understand their growth strategies and business models, and consider how you can adapt these insights to your own business.

4. Build a Strong Company Culture: Actively work on creating a company culture that aligns with your vision and values. Make this a key part of your hiring process and ongoing employee development.

5. Prioritize Creativity in Branding: Regularly review your branding to ensure it's not becoming too generic. Use creative strategies to make an emotional impact on your customers.

6. Develop Engaging Content: Plan and create engaging content, such as comedy videos or interactive social media posts, to connect with your audience on a deeper level.

7. Hire for Cultural Fit and Business Acumen: When hiring, look for candidates who fit your company culture and demonstrate a strong understanding of business. If an employee doesn't fit, consider letting them go to maintain a strong team.

8. Communicate Your Vision: Regularly communicate your company's vision to your team. Ensure that everyone understands and shares this vision to maintain a cohesive team and drive your business toward its goals.

9. Stay Adaptable with Business Strategies: Regularly review and adapt your business strategies based on market trends, customer feedback, and business growth. This will help your business stay relevant and successful in the ever-changing e-commerce landscape.

10. Invest in Team Development: Implement regular training and development programs for your team. Recognize their value and invest in their growth, as a motivated and skilled team can significantly contribute to the success of your business.

PLUFL — THE WORLD’S FIRST DOG BED FOR HUMANS

There’s just something different about dog beds. They look 10,000x comfier than a human mattress. Yuki and Noah thought the same, so they set out to create the world’s first dog bed for humans!

They were on Shark Tank Season 14 Episode 5.

I’m giving them a shoutout for two reasons:

1. Yuki is going to be a future interview on Sunday Stories! Might as well familiarize yourselves with the brand now 🙂 

2. They hugely outpaced their goal for their current Kickstarter campaign. They’re making another innovative sleep product—Hugl.

If you’re excited to hear more from Yuki, subscribe to stay tuned!