How We Started A $500K/Month Business Selling Kitchen And Bath Products
Hello! Who are you and what business did you start?
Hello, I’m Howard Law and I am a co-founder of Magnus Home Products. Magnus is an e-commerce business specializing in unique high-end kitchen and bath products that are typically not found in the big box stores. We offer over 6,000 SKU’s online.
Some of our signature products are unique bathroom sinks made of concrete, petrified stone, stone, and wood. We offer a wide range of farmhouse sinks in fireclay, copper, stone, cast iron, and stainless steel. Our bathtubs are constructed of copper, stone, wood, cast iron, acrylic, and resin. Our customers include homeowners as well as commercial accounts such as remodeling companies, plumbing suppliers, designers, etc.
Our products are both sourced directly from the factories and also through third-party distributors. I visit every factory we buy from and have developed long term relationships with all of our vendors/partners. This allows us to offer new and unique items much sooner than our competition. We also can develop exclusive designs not available anywhere else.
We started Magnus in August of 2017 and have been able to double our sales each year with projected sales of $5,000,000 this year.
What's your backstory and how did you come up with the idea?
My partner and I worked for a family-owned company for many years and helped to grow it to become a very large player in the industry. As often happens the owners eventually decided to sell the company to a huge corporation. My partner and I decided that working for a huge corporation was not going to be a good fit for ourselves and decided to go out on our own.
My partner has a background in IT and I have a background in sourcing, marketing, and purchasing. With both of us having over 20 years’ experience in our fields and the addition of a few key players we felt we had all of the pieces needed to be successful. The two of us along with a financial partner started Magnus in August of 2017.
We had the knowledge of what products would be successful, where to source them, and how to build a website. Our challenges were putting together a team to build the site and be able to offer superior customer service once we went live. Once we built the site we needed a marketing partner to generate the sales for the site. Little did we know that this piece of the puzzle would be the most difficult.
We have had to wear many new hats and learn so many new things. Human resources, employee healthcare, commercial leases, accounting, logistics, the list goes on and on. Each day brings new challenges and new joys.
Take us through the process of designing, prototyping, and manufacturing your first product.
With the huge number of SKU’s, we offer the majority of the products we purchase are off the shelf items from manufacturers. However, when we have a strong selling item or come up with ideas for new products, I do work directly with the factories to develop new products as exclusive items for us.
Normally I will start with simple drawings or photos of similar products to present to the manufacturer. Then they will provide drawings to sign off on then produce prototypes for final approval. My local QC staff will provide the initial inspection of the sample and communicate with me any issues they see. Once we have final approval I sign off on production.
Describe the process of launching the business.
Since we were starting from scratch we looked at all the different platforms available and decided on Shopify as we found it was very user friendly, has a wide range of plug-ins available and they have a very good customer support system.
As anyone who has started an e-commerce business can attest to there are a million things to accomplish. Our initial target was to add approximately 3,000 SKU’s as quickly as possible. We also still had to come up with a logo and a theme for our web site. With the huge amount of initial work needed to create so many ads we knew we would need multiple graphic designers. We took a different approach and hired four college students enrolled in local universities in graphic design. This provided us with young inexpensive talent that had fresh ideas. It also allowed them to receive co-op credit for their work experience. After 6 months we hired a full time professional graphic designer to lead the team. Looking back I should have hired the seasoned graphic designer at the onset to give the college students guidance.
Initially, we were using vendor-supplied artwork, which in most cases was terrible, but we didn’t have the resources to set up a photo studio and take beauty shots of thousands of products. Approximately a year into the project we teamed up with an extremely talented group that has helped to transform our web site with beautiful images, all of which are CGI. The speed and cost savings of going this route has saved us hundreds of thousands of dollars in photography costs.
The customer service team we put together all came from our former employer, as they were all looking for that small family run business that they had lost when our former employer was sold. We were able to assemble a group that had multiple skills that helped keep our overhead down. One of our CS advisors had an English degree so he also writes our copy. Another is a certified plumber, he can assist our graphics team with installation instructions and spec sheets. Additionally, none of our competition can tout having a plumber on staff to answer customer questions.
With the site built and a customer service team in place, we needed to partner with a marketing firm that would work with a start-up and could provide the return on investment that we needed. Two years and two marketing companies later we finally found a partner that has provided incredible service and has us tracking to produce the return on investment we needed. This one piece of the puzzle was the key to our success.
We launched a second e-commerce business at the beginning of 2020, which specializes in handcrafted home accessories. Whereas our Magnus site is slowest from Thanksgiving to Christmas, this site should be strongest during the holiday period as this product range is ideal gift items. This will allow us to utilize all of our team to the fullest year-round.
Since launch, what has worked to attract and retain customers?
As I alluded to in the previous question the key factor in our companies success hinged on finding a marketing organization that understood our products and the market we sell to. They needed to be leaders in Google ads and create a strong return on investment. It took us 2 years and three companies to finally find the perfect partner for us. That one key item is the difference between success and failure for us.
We have tried other sales avenues with varying degrees of success including eBay, Wayfair, and Amazon. Amazon is by far the best second line of sales we have. But with the number of SKU’s we offer Amazon's marketing has also had to be outsourced to be effective.
We host a Facebook page which we use for promoting goods as well as creating followers. To give our company a bit of a warm, more personal touch we developed our Take Notice With Otis series on Facebook. Otis happens to be my rescue pup and he shows up on our posts promoting our site, holidays, products, etc.
We can be found on Pinterest and Instagram. We just launched a YouTube channel where we are sharing videos on how our products are made.
Since our products are typically more expensive and a one-time purchase our marketing is a bit different than most companies where the goal is repeat buyers. Our typical customer visits our site three to four times over two weeks before purchasing a product.
How are you doing today and what does the future look like?
We continue to grow at a strong pace even with all of the troubles that 2020 has brought to the entire planet. Each year we have doubled our sales from the prior year and 2020 is tracking to do the same.
We are investing more in SEO allowing us to finally grow our sales organically. We have added features to the site such as financing which is a popular option due to the high retail of many of our items. We continue to invest in improving our visual content providing our customers with better images of the product they are ordering. We have recently started promoting “bundling” packages of sinks and faucets and bathtubs and tub fillers. This provides customers with a discounted price on some of our most ordered items.
Last August we moved our business to a new location with a warehouse which allowed us to import our best selling items ourselves. We have outgrown this facility and are looking forward to our next move into an even larger facility. Having a larger warehouse allows us to have more control over our future and increases margins on our most popular items.
We launched a second e-commerce business at the beginning of 2020, Rico & Plato which specializes in handcrafted home accessories. Featuring products made of wood, stone, and copper. Whereas our Magnus site is slowest from Thanksgiving to Christmas, the Rico site should be strongest during the holiday period as this product range is ideal gift items. This will allow us to utilize all of our team to the fullest year-round.
Looking forward to three years we feel we will surpass most of the competition in our segment of the marketplace.
Through starting the business, have you learned anything particularly helpful or advantageous?
Looking back I would have hired a full time lead graphic designer to assist our co-op team at the beginning of building our site. Additionally, I wish we had moved to our current marketing company much sooner. I can only imagine where we would be now if we had met them a year sooner.
With regards to opening our warehouse, this was a necessary step, but a painful one. Neither I or my business partner have any background in this part of the business. So it has been a learning experience. From laying out the warehouse, buying racking and equipment, to filling the shelves and fulfilling the orders. When we received our first order we didn’t even have boxes yet, I had to run down to the local big-box store and buy boxes at an extremely high price. Now we have bubble makers, paper machines, and expanding foam equipment.
Both my partner and I have had to wear many new hats and learn so many new things. Human resources, employee healthcare, commercial leases, accounting, logistics, the list goes on and on. Each day brings new challenges and new joys.
What platform/tools do you use for your business?
Our sites are hosted by Shopify and I highly recommend them. There are so many different apps that work with Shopify, so you can find just about any add on you will need.
What have been the most influential books, podcasts, or other resources?
I honestly have to say that I have primarily been influenced by others in the industry that has been there and done that. I prefer one on one conversations learning from what they have done and experienced.
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
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