April 30, 2014

Bath and Body Mogul Emilie Sennebogen Shares Her Story

Filed under: Uncategorized — Meredith @ 2:11 pm

lym

Today I’m chatting with Emilie Sennebogen of Love Your Mama, a bath and body company based in Atlanta, Georgia.

1. Tell us a little about what you do, how you got started and what your growth has been like since you started your Love Your Mama.

We make all-natural soap, body products and soy candles. (The name Mama is a fun twist on Mother Nature/Mother Earth). I quit my job as a producer in the film industry at the end of 2008 after having Mama on the side in some form since 2002. I’m not one of those people who made soap to unwind and gave it to friends and they loved it so I decided to make it a business. I always treated it like a business. But I had a lucrative job and it just took me a while to get it to where I was ready to give that up and really give Mama go.

I always felt like Mama was a retail business for several reasons: 1. Our all-natural products have a shorter shelf-life than many store brands which most retailers aren’t used to. 2. Educating the customer about natural products is our main mission and I wanted that customer connection and experience and 3. I had a retail background from high school and college and quite simply, I wanted to have a retail business.

I wasn’t ready to hit Main Street right away in 2009. So I opened my first retail store/workshop in an out-of-the way location (read: cheap rent) and have grown very organically from there. We currently sell at our retail store (where we make everything), at festivals, online and wholesale – we’re in over 60 stores in the US right now. Other than some 0% interest balance transfers when I’ve needed to make an investment in equipment, I’ve bootstrapped the business up until now, so we’ve grown at a slow and steady 20-30% per year for the last 5 years. Until this year, that is; we’re about to open another retail store in a busy location later this year and we’re moving our current out-of-the-way store to a bigger storefront in a smaller Main Street area of town. Plus, our wholesale business has had a considerable boost since our most recent trade show in January, so I anticipate well over 100% growth in the next 12 months. Exciting and more than a little scary!

2. You seem to do it all, manufacturing, online retail, teaching, festivals, wholesale and even a brick and mortar shop. How did all that evolve and how do you keep up with so many moving parts? Are all of those revenue streams equally important to you or are there one or two that are the biggest part of your business? Has your best revenue source changed over time?

There are a lot of moving parts to my business and it’s really tricky to keep up with all of them. I wear a lot of hats and I’m running around with my hair on fire most of the time. It certainly keeps things interesting! I also have three employees with very specific job descriptions, so that’s definitely a huge key to managing all of the pieces.

Here’s how my early decision making process went: The manufacturing was always the most important part to me. I knew I wanted Mama, first and foremost, to be a handmade body product business. When I decided to go full-time with Mama in 2009, I had to think about what sales channels I wanted to use to get my products in the hands of customers. I was already doing festivals — Atlanta has a lot of them, and that was the low hanging fruit, so to speak — but they’re mostly in the spring and fall and I didn’t want to be a seasonal business. I also needed to move out of my house; we were getting serious about renovating our fixer upper and Mama had worn out its welcome long ago. So a workshop that served as a retail storefront made sense for us.

Classes were going to be a big part of my business plan when I opened the store, but there was so much to do just running the business that I didn’t actually get around to starting those until 2013.

Starting out with a retail store, even one off the beaten path with limited hours, meant hiring employees from the get. It wasn’t the cheapest way to get a business off the ground, but it did allow me to focus on more than one thing at a time, which is how I like to do things. And then taking on that overhead out of the gate necessitated multiple revenue streams to keep paying the bills.

We had a modest Internet business that had kind of been putting along behind us since we started in 2002 and opening the storefront landed us some press (A Southern Living magazine mention in December was fortuitous for our 2009 holiday season), which helped drive a good bit of Internet sales and a little bit more foot traffic. I have always wanted the retail store to be our main source of revenue, so my original plan in 2009 was that I would use the festivals to drive traffic to the store for a few years and then cut back our participation. But festivals continue to be a great source of revenue and the store is still off the beaten path, so now we do as many as we ever did, if not more.

I’ve never focused a ton on the website because we have products you need to see and feel and experience in person. So most of our Internet customers are either repeat customers who can’t make it to a store or they’re buying as a gift.

I never really saw wholesale as an ideal way to grow because we make everything by hand using high quality ingredients that aren’t cheap, resulting in tight wholesale margins. Until 2012, we only opened wholesale accounts that came to us and were a good fit. We were in about 10 stores around Atlanta as well as a couple of co-ops and I didn’t put a lot of time or effort into getting more.

But at the beginning of 2012, our growth at the store and festivals was starting to flatline and I was getting antsy. I really wanted to move the store to a busier location, but the economy was still crap and a lot of Main Street shops were really struggling, so it didn’t seem like the right time to make that investment. Plus, I couldn’t really find the right scenario in any of the areas in Atlanta where I wanted to be. So instead, anxious for growth, I decided to do a trade show. It was a huge investment and took a lot longer than expected for the ROI I was hoping for.

In 2013, our revenue chart was a perfect little pie – we did just about equal amounts in the retail store, at festivals and wholesale, with a little smaller slice for Internet. So it’s definitely safe to say that all of these income streams have been equally important to our business.

In 2014, if all goes as planned, the retail store pie slice will get a good bit larger. And classes and supplies really just took off at the end of 2013 and are doing great for us in 2014, so they should be getting a decent sized sliced too. All of this is leading toward more focus on the areas I’m most excited about, which is really exciting.

3. Your company teaches soap making classes. Teaching customers how to make the product you sell might seem counter-intuitive to a lot of entrepreneurs. What prompted you to start teaching your craft and how has this helped your business?

The main reason we started teaching classes was to drive more business to our retail location and to add a service to our product offerings – yet another revenue stream. Packing up heavy boxes of soap and hauling them all over town to sell gets really old after 5 years, so I wanted to find a way to bring more business into the store.

In addition to a dearth of soap making classes in Atlanta, I also realized there was really no place to go locally to buy quality soap making ingredients. We buy them in bulk, so packaging and selling them to hobbyists seemed like it would be a good additional income stream that wasn’t too time-consuming. And both classes and supply sales have really taken off. Most people who take a class end up buying something, so we always have our best days at the store on class days.

4. Do your students want to learn to make soaps just for fun or do you run across a lot of students that want to create a business like yours. If you have students who want to get into the soap business how do you handle that? Do you ever run across students that you think will succeed in starting a soap business and why do you think they’ll be successful (or if you think they won’t be successful, why do you think that)?

We have an interesting mix of people who take our classes. A lot of people think it’s interesting and just want to try it because taking classes is fun. Some want to take it up as a hobby and make soap for family and friends. And then there have been a few who I think are more serious about it and might want to take it to the next level as a business. I’m pretty forthcoming and open when people ask questions about the business as long as it’s not proprietary information, like our product recipes or our essential oil supplier. If people are willing to invest in us as their teachers, I’m willing to share what I know. I’ve found it promotes trust not only in us as teachers but also in the business. And it keeps them coming back for more classes and supplies.

Here’s my philosophy about teaching other people soap making. Firstly, for the most part, DIY people aren’t our customer. If they think they can make it themselves (even though most people will buy all of the ingredients and they will sit under their kitchen sink for the next 2 years), then they’re probably not going to pay $8 for a bar of soap. But hopefully, they’ll come to us to teach them how to make soap and then buy their supplies from us! It also lets us promote our mission of teaching people about natural ingredients, which is my mission in life.

Secondly, starting a business, especially a product business, is really hard and expensive. It’s difficult to make much money doing it as a hobby or on the side. So I figure if someone has the gumption to start a soap business, then more power to them! Funny story: a few years ago, a lady (who I had never met) called me at the shop begging me to make her lip balms for her. She was a lawyer who wanted to start a lip balm business, but once she started doing it on a business level, she discovered what a pain in the butt it is to make things over and over and over and she was so exasperated and just couldn’t do it anymore. I laughed and told her she should keep her day job.

5. Tell us about a difficult period or big mistake you made with your business. What went wrong and how did you recover?

I wouldn’t call doing wholesale tradeshows a mistake, but I would say that making that leap made things much more difficult than anticipated for about a year and a half. I had done a lot of research going into our first tradeshow and read it would take a couple of shows to really get things going, but everyone hopes they’ll be the breakout hit even though you know it’s not terribly likely.

It took 3 shows for us to break even on our overall investment and we didn’t have what I would consider a successful show until our fourth, so that was a year and a half of having valuable cash tied up in trade show expenses. As soon as you finish filling orders for one, the not-cheap booth fee is due for the next one. And a lot of time orders placed at the show are spread out to fill over 5 or 6 months, so the money doesn’t come in all at once.

The reason I ultimately decided to keep doing trade shows (for now) is because it fills in some downtime in our retail calendar, since trade shows crank up during down retail months. And it has helped us grow and does help pay the bills. It makes more sense for me to try to get in front of as many stores at once than to try to carve out time to make cold calls throughout the year (I’ve tried – it doesn’t happen). But honestly, I still don’t love wholesale. It’s just not where my heart is.

The brands that seem to do the best at trade shows have much better margins and a lot more resources (money) to invest than we do and they also make it their main focus. For us, it’s only a piece of the pie and it’s the most effort for the least profit. My plan is that now that we’ve found a great location for retail store #2 and a better location for retail store#1, we will be able to put the majority of our focus into retail while maintaining our existing level of wholesale business without much more of an investment.

6. What would you say is the most valuable thing you’ve learned since you started your business?

I’ve learned A LOT of valuable things since I started my business, but probably the most valuable is how to hire and manage employees. And it’s still a work in progress, but I’ve gotten a lot better at it. Truthfully, I’m much better as a solo worker. I love bouncing ideas off of people, but I don’t thrive on collaboration like a lot of people do. I’m a perfectionist and I’m not super patient and I hate micromanaging to the point that I undermanage. If I tell you once and you don’t ask any questions, I presume that you’ve got it all under control and I end up finding out that hard way that isn’t the case.

I started my business so that I could be creative and I started making soap so that I could make soap. When I was dreaming about quitting my day job, I didn’t really consider that to grow I would have to hire people and teach them to make soap while I focus on the less fun but more important aspects of growing a business.

I have consistently overestimated my ability to do it all myself for most of my life. Bringing other people into my business — with their various personalities and their own agendas and ideas about how things should work — has been the most challenging aspect. When things are great, they’re fantastic. But I have lost more sleep worrying about how to deal with a difficult employee situation than I ever have about anything financial.

I’ve always hated the saying “business isn’t personal,” because there’s nothing more personal than working for someone who owns a small business — both for the business owner and the employee. I feel a lot of responsibility for these people who rely on me for their income and their daily job experience and I don’t take any of it casually. We spend most of our waking hours at work, so the work environment is really important to me.

Early on, more than once after a bad employee situation, I thought about shutting my business down and doing something else because I knew I couldn’t grow without help and I didn’t know if I could be happy with the drama that comes from hiring and managing people in such a small business environment. But I toughed it out — I read a lot of books and articles, talked to a lot of other business owners and learned how to do a better job in the interviewing and hiring process. I hired some great women who are committed to the company and our mission and there’s far less drama these days because I’ve become a better manager. I’ve learned to be more clear about my expectations and boundaries and it makes for an easier work environment for everyone. But I’m always continuing to learn.

7. If you had to start over from scratch with a new business today what would you do differently?

I would definitely do a service rather than a product. Something where I could work by myself for the most part, preferably from home (no overhead) and something that is more project oriented. No business is easy, but I would probably choose something easier than the one I have now. Probably something in the design realm, like web design, graphic design, surface pattern design, garden design, etc.

I’ve actually considered each of these careers more than once during tough times with Mama and I’ve even taken a few classes. But at the end of the day, I keep going back to the fact that I have this business that I’ve invested a lot of time and money into, not to mention my heart and soul. And we continue to grow year after year. I love this business and what we have created and the women who work for me and the customers who support us, so I hope I will have the good fortune to be able to continue doing it and growing for a long time.

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