Taking Big Business Risks and Reaping the Rewards. Meet Amy Richardson!
on July 19, 201706:21 PM Updated July 19, 201706:21 PM - last edited September 07, 201703:28 PMSeptember 07, 201703:28 PM by LeslieBarber
Amy started sewing baby clothes on her kitchen table when she was pregnant with her first baby. Four years after she put the extras up for sale on Etsy, she has a growing business with 150k+ Instagram followers and she just moved into a brand new office space in Brooklyn.
We asked her to dish on what it was like when she decided to change her business name along the way (talk about a big risk!) and how she's building a community of fans both online and offline.
I started doing what would become my business when I was still working a 9-to-5 at Teen Vogue.
I originally learned to sew in third grade, and when I was pregnant I started making a little cap I had a pattern for. I immediately found the process addictive — baby clothes are so quick to make! After racing through dozens of pieces, I decided to put the extras up for sale on Etsy.
I owe a lot of my success to social media. I grew my network by printing Instagram links on the packaging for my products, partnering with bigger brands like Orbit baby for giveaways and sending products to tastemakers in the lifestyle world — including celebrities, bloggers and even a basketball player’s wife!
I also take time to scroll through Instagram and find influential people who share our aesthetic. It’s a bit like cold calling. We don’t specifically ask them to share anything, but people are generous. Around 30% of those we send a product to will post about it.
When did you know your business was going to work?
There was a catapult moment in March of 2012 when Cool Mom Picks, a blog with a huge following, published a beautiful feature about one of my blankets. It got 182 pins on Pinterest and our Instagram following shot up over the next year to 15,000.
Around that time, the money I was making from the business, which was then called Little Hip Squeaks, started to match what I was earning at my regular job. In May of 2012 I quit to work on the business full-time.
In September of 2012 I hired my first employee to deal with customer service. She’s still with us now, managing our operations. We moved into our 700 square foot office in Brooklyn a year later, and now I have three in-house staff and four freelancers who are responsible for PR, SEO, design and pattern making.
What has been the biggest surprise about starting your own business?
I’ve been surprised by how many risks we’ve had to take.
We’ve been through some monumental changes since we started — moving from my kitchen table into a proper office space, working with a new manufacturer and even changing the brand name.
Changing the name had been at the back of my mind for years. I felt uncomfortable reaching out to bloggers with the name Little Hip Squeaks. It was kind of corny and didn’t represent the brand anymore. I also thought it would hold me back from expanding into maternity wear and collaborating with non-kids companies.
It was a big deal for me, but we were moving our manufacturing to the West Coast and it was a case of "go big or go home," so it all happened at once.
How do you price your products?
Most companies go for the highest possible margins, but we’re a bit different.
Initially we followed a traditional pricing model, calculating half-off prices for wholesale. But we realized the majority of our sales were going directly to consumers and we wanted to reward them for sticking with us.
We brought our prices down to around 3.5 times the cost of production. That way, we get more pieces into more people’s hands. It’s definitely a compromise — we have small margins on items that are more expensive to produce, and vice versa. Each product costs in the region of $5 to $40.
We've learned that people are likely to buy more than one product at these rates, and we can be affordable for the average mom.
What is your most effective method for getting new customers?
My marketing is focused on social media because it allows people to feel like they’re buying from a friend.
A lot of people struggle to separate their personal life from their business when they gain a large social media following and think about pulling back. But for me, it’s worked well because people have a connection with me and my kids. They’ve watched my son grow up and have shared my excitement about welcoming a new baby.
I’m honing in on this connection by taking that bond offline, too. I’m organizing pop-ups and non-commercial events like cookie-making parties and craft afternoons. I’m not actively selling anything there, but I’m building relationships with moms and rewarding loyal customers with a community.
If you could go back in time, what’s the one thing you’d do differently in starting your business?
I think the business would have grown much faster if I’d borrowed money earlier in the process.
When I started out, I funded everything with my regular salary and reinvested the profits. Then, 18 months ago, I took out my first PayPal loan of around $10,000. I’ve just taken a much bigger loan and had some smaller investments, which has been a fairly scary process.
It can be challenging to let go of any control in a creative business, so a lot depends on the arrangement you have with your investor. Once somebody gives you money, they might feel like they can get involved with the day-to-day running of the business and the creative process. I’m lucky that I get along really well with my investors, but I still find the monthly repayment deadlines a big pressure.
What would you like to learn today from a network of other small business owners and self-employed professionals?
Sometimes I feel like there are too many cooks in the kitchen. Other times, I think I should be growing the team to expand our reach.
I’m interested to know how other companies structure their teams. Do you outsource customer service? Is it important to hire a CFO or marketing director?
I love finding out how others delegate tasks or if they juggle the workload alone.
Do you have tips for Amy and the other small business owners here?
Have you explored outsourcing one part of your business, like customer service or marketing? How and when do you decide to delegate a task?