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Lessons from
VALUE-ADD Cottage Businesses
John Pugliano
March 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’n
1/4
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
small
market
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 money
Baby 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

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