Lessons from Value Add Cottage Businesses to Help You Take the Next Step - Presented by John Pugliano

Lessons from

VALUE-ADD Cottage Businesses

John PuglianoMarch 5, 2015

DISCLAIMER…not providing recommendation or advice

John Pugliano is only an expert

DISCLAIMER…not providing recommendation or advice

John Pugliano is only an expert

…in his own OPINION

AGENDA

• Self imposed limitations

• Lessons & highlights from Cottage (home-based) businesses

• Breakout session• Ideate

• Questions

• Collaborate

DON’T BE A PURIST

…you’ll miss the opportunity to create something AMAZING

Move yourself closer to the ETHICS

• Care for the EARTH

• Care for People

• Return the Surplus

Frederick Douglass

• Runaway slave and FREEMAN

Frederick Douglass

I prayed for twenty years

but received no answer until I prayed with my legs.

Frederick Douglass

I prayed for twenty years

but received no answer until I prayed with my legs.

The purpose of this presentation is to inspire you to …TAKE THE NEXT STEP

Start where you are…with what you have

• Even if it’s not much

Ever hear of Ephraim UTAH?

That little valley is home to NINE seed companies

• Great Basin Seed

• Intermountain Seed

• Maple Leaf Seed

• Maughan Seed

• Mountain West Seed

• NP Seed

• Plummer Seed

• Stevenson Intermountain Seed

• Skyline Reclamation

You DON’T have to be ORIGINAL

• MIMIC successful companies in your area or field of interest

THINK in terms of

PRODUCT or SERVICE

http://greenworksllc.com/

Jessica got inspired…

• From a PODCAST

• SPIN farming blighted area of SLC• $2,000 investment

• Grossing around $70k on <acre

• SUCCESSFUL?• Last time I saw her she was leaving to

backpack across New Zealand

Jessica not only worked hard

• She IMPROVISED

• Need a 10x10 walk in cooler• New start at ~$4k

She built one

• <$800• Insulation

• Used air conditioner

• PLC temperature control

• It could be disassembled and moved when needed

Regulatory Requirements & Restraints

• COMPLY with the MAN

Comply with the MAN

• Raw milk labels

DISCLAIMER: I’m not saying you should do this…I’m just say’n1/4

Follow the path of LESS REGULATION

• Pet products

Don’t marry your concepts- date them

• Commercial Kitchens can be RENTED…

• By the HOUR, DAY, or WEEK

Don’t marry your concepts- date them

• Commercial Kitchens can be RENTED…

• By the HOUR, DAY, or WEEK

Minimal startup costs…I’m just say’n

Permaculture tunnel vision

• Expand your peripheral vision and STACK FUNCTIONS

What would you do if you owned a bobcat?

• Permaculturalist

• Swales

• Hugel mounds

• Terraces

• Water catchment

smallmarket

STACK FUNCTIONS

• General construction support

• Traditional landscaping

• Stump removal

• Snow removal

Stump removal STRATEGY

• Equipment• Used: ~$10k

• Lots of sweat equity

• New: financed ~ $2500/month cash flow needed to pay off 4 year loan• no money down with good credit

• Treat debt like a poisonous snake

• Early to bed, early to rise…work real hard and ADVERTISE• MARKETING…MARKETING…MARKETING

Stump removal Transition STRATEGY

Stump Removal Mulch

ryexservices.com

Stump removal Transition STRATEGY

Stump Removal Mulch Permaculture Landscaping

mundane commodity TRANSFORMATIONAL

ryexservices.com

No money?

• How HARD are you willing to work to build your dream?

Get started with a squeegee

• Residential Window Cleaning• Not glamourous but profitable

• Outside work

• Work with your hands

• In demand

• Happy customers

• “Green” solutions

Not glamourous but PROFITABLE

• Do the math• $5/pane…2,000 sqft house…$150/house

• How many houses do you live near?

• Easy to determine the NEED

• CONSUMABLE

Did I mention it’s mostly a “cash” business…I’m just say’n

Cash in on TRASH

You don’t have to own a junk yard

• Think NICHE…you don’t want the whole car

• Just the EXPENSIVE parts

• Used Lexus headlight assembly• sold on Ebay for >$700

Salvaged auto parts STRATEGY

• Little to NO cash required to start

• The problem is the solution

1/2

Auto body shop DILEMMA

• Salvaged parts are valuable and owner will get around to re-selling them

• He never does…

Consignment sales – the SOLUTION

• YOU approach auto body shop with an offer he can’t refuse…

• Inventory & categorize

• Clean up

• Photograph & list online

• Split profits

How many auto body shops are within a 20 mile radius of your house?

Cash in trash…one for the Lady’s

Cosmetics

• Overstocks…Closeouts…Damaged items

• There are truckloads available

• Re-sell online

THINK: shelf stable

Apple Pie - shelf life ~ one week

THINK: shelf stable

Apple Pie - shelf life ~ one week Jerky - shelf life ~ 10,000 years

Less loss to spoilage…MORE PROFITS

You don’t have to reinvest the wheel

• Humans have been harvesting honey for at least 15,000 years…

Eco Bee Box LLC

Metal brackets permit easy construction of super from local lumber or salvaged materials

Small frames make harvesting honey easy for the hobbiest or micro bee keeper

Service vs Product

• Host-a-Hive• SPIN farming concept applied to bee keeping

• Host buys or rents hive…YOU provide the beekeeping service

• Excellent source for LOCAL HONEY

LOCAL HONEY has higher profit margins…

• Typical honey pricing $/lbs:

• WalMart: $4.00

• WholeFoods: $8.00

• Local: your price?

Poor man’s MBA

• Determine MARKET size & scope

• On the shelf at WalMart Large market potential

and

• On the shelf at WholeFoods Permaculturalist potential

Poor man’s MBA (continued)

• Determine PRICE point

• Whole Foods retail price = your MINIMUM price

Poor man’s MBA (continued)

• Determine PROFITABILITY

• WholeFoods price - your cost to produce = OPERATING PROFIT

• IS IT WORTH YOUR TIME?• YES…DO IT !

• NO…look for something else…iterative process

3/4

LOVE Animals?

Make your horses pay for their own feed

Ryan @ Cowboy Carriage

City Tours…Corporate Events…Sponsorships

• Weddings• (starting @$750)

• Brewery tours • (starting at $500)

Dog trainer/breeder

• Service Dogs• Assist dogs: $10k

• Visually impaired guide dogs: $20k

• Personal Security Dogs• $5k-$20K

Concern for personal security

• 48% of first time gun purchases are by WOMEN

Concern for personal security

• 48% of first time gun purchases are by WOMEN

Which do you think she’d rather curl up with?

Humane animal control

• Yuppie’s love large homes in natural settings

They’re just afraid of “wild animals”

• $300-$600 McMansion attic removal fee

Attention to detail?

• Model ship assembly• $1,595

Old Modern Handicrafts

Attention to detail?

• Model ship assembly• $1,595

Old Modern Handicrafts

It comes in a kit…I’m just say’n

Rebirth of the Middleman

• Large companies don’t want to be bothered with small orders

Powder Coating

• Environmentally friendly way to apply paint

• Powder is shelf stable

• Easy to handle

• Buy in bulk…sell by the ounce

Powder Coating STRATEGY

• Buy in bulk from manufacturer or large distributor

Break down into small orders

• Service local market & re-sell online• Specialize in a particular industry• Stock niche colors

$2/lbs $12/lbs

Re-think the tiny house movement

Millennial

LOVES tiny house

Re-think the tiny house movement

Millennial

LOVES tiny house

No moneyBaby Boomer

DISCRETIONARY income

@livingthervdream

Baby Boomers LOVE RVs

• Sales up 20%

• Class B van:• Used ~$20k

• New starting around $50k

Think TINY HOUSE CONCEPT

Handy with TOOLS?

• Consider starting a Van CONVERSION business

• Minimal startup costs

• Scalable

• Limited only by your imagination

Service vs Product

Used Class A RV starting price around $50k

PROBLEM

• Sketchy reputation of Re-Sellers• What happens to a used car salesman that gets fired for being dishonest?

SOLUTION

• RV pre-sales inspections

• Demand from both Buyer & Seller

• Demand in both Urban & Rural locations

• Unregulated in most States

• Typical inspection costs $800-$1200

Breakout session

• Q&A

• Ideation

• Networking

• Collaberation

Are you ready to take the NEXT STEP?

BREAKOUT SESSION

PRODUCT SERVICEUNDECIDED

BREAKOUT SESSION

• Introduce yourself & your idea

• What’s the biggest obstacle holding you back?

QUESTIONS?

BREAKOUT SESSION

PRODUCT SERVICE

Undecided…pick a group

BREAKOUT SESSION

COLLABORATE

Contact me at…

www.wealthsteading.com