With guests from established enterprise companies to start-ups barely out of infancy to everyone in between - you’ll get the inside scoop on what’s Up Next in Commerce. New episodes come out every Tuesday and Thursday.

Subscribe to get notified of new episodes and our Up Next in Commerce weekly newsletter. 

EPISODE 32

How The Simple P&L Statement Can Be Key To Long-Term Success

With Patrick Cuddou, the founder and CEO of Supply

Or listen in your favorite podcast app

Apple Podcasts  /  Google Podcasts Spotify

How does a guy who used to sell fighter jets move on to build an Ecommerce company that sells single-blade razors? It’s an interesting question with an even more interesting answer, and on this episode of Up Next in Commerce, Patrick Coddou tells the tale, and gives some insights into the world of Ecommerce along the way.

Patrick is the founder and CEO of Supply, and even though the company has been in business since 2015, has seen 80% of its total profits have come in over just the last several months. So what’s Patrick’s secret? In today’s interview, Patrick dives into the nitty-gritty of what changed, including how he finally discovered exactly what profit margins he — and most companies — need to hit in order to achieve sustained success. Learn what that number is and more, on this episode.

Key Takeaways:

  • Always Be Testing: To achieve the best user experience and optimize sales, you need to constantly test new ideas. Whether it’s pop-ups to showcase new items, implementing a legacy program, or experimenting with video, you learn something new every time you test. Plus, sometimes the failed tests are even more valuable than the successful ones.   
  • It’s All About the Margins: Businesses live and die based on their gross margins. If you are not charging enough and/or pay too much to have your products made, you’re putting an unnecessary financial strain on your business that could break it.
  • Riding the Ecommerce Waves: There is a ton of volatility in the Ecommerce industry. In order to achieve sustained success, companies need to be nimble and able to adapt to the changing tides. Keep overhead low, focus on your P&L and build processes that allow you to make quick shifts when needed.

For an in-depth look at this episode, check out the full transcript below. Quotes have been edited for clarity and length.

Key Quotes:

“I always tell young founders or operators that when things go wrong, trying to cover it up or not being honest about it with your customers is just going to make it worse.” 

“I always highly leverage toward trust when I’m evaluating a new partner rather than capability. Because capability is just table stakes for us to even have a conversation. Something is going to go wrong and what happens when it goes wrong is what makes all the difference.”

“I worked all last year to significantly improve our gross margins — essentially how much our products cost to make versus what we sell them. The first four years of my company, I wasn’t charging enough for my products and they were costing me too much to make.”

“I always urge young businesses and founders to keep overhead as low as possible. I think a lot of the reason you’re seeing a lot of companies go out of business or have issues this year since COVID hit is they don’t have the flexibility in their overhead to withstand volatility in the marketplace.” 

“We’re always trying to get ahead of the curve when it comes to ordering because, historically, we’ve always had to rush shipments via air. …Air shipments cost anywhere from five to 10X more than ocean shipments. So that’s always really painful when you have to spend 20 to 30 grand just to ship something versus two to three grand.”

“I live in my profit and loss statement. I’m counting every single penny that goes into my cost of goods sold whether it’s the cost to ship to me, whether it’s cost to ship to my customer, the fees I’m getting charged by my credit card companies, cost of my boxes. It requires relentless dedication to constantly being in the numbers… It’s like entropy. All things tend towards chaos. Well, everything in your P&L tends towards higher costs if you don’t stay on top of it because you’re just going to spend more and more money.”

“What’s really, really difficult is to position our product as both a men’s and women’s product at the same time.”

“I think it’s a complete waste of money to spend any money on complex web design. I would encourage people to not spend any money on development and take any money you have and invest it all in creative and start with just phenomenal photography.”

“Every month, we’re testing something new or we’re launching a new feature. Sometimes it works, sometimes it fails miserably. Each month is just an opportunity to get better.”

“There’s a ton of opportunity in the future and a ton of volatility in the future for Ecommerce…consumer behavior is going to continue to be challenging to forecast. Part of me is waiting for the other shoe to drop wondering when is this all going to come crashing down and the other part of me is thinking Ecommerce is 30% of retail now and that’s not showing any sign of stopping anytime soon. So in general what I’m doing is I’m doubling down. I’m building processes and teams for growth.”

Mentions:

Bio:

Patrick Coddou is the founder and CEO of Supply, a single-blade razor company. Prior to founding Supply, Patrick spent more than eight years at Lockheed Martin in various product, strategy and business development roles. He also co-founded Razorpedia.com, a consumer review website for razors that provides quantitative and qualitative feedback on razor performance along with visibility into replacement blade pricing.

Up Next in Commerce is brought to you by Salesforce Commerce Cloud. Respond quickly to changing customer needs with flexible Ecommerce connected to marketing, sales, and service. Deliver intelligent commerce experiences your customers can trust, across every channel. Together, we’re ready for what’s next in commerce. Learn more at salesforce.com/commerce

Transcript:

Stephanie:

Welcome to another episode of Up Next in Commerce. This is your host, Stephanie Postles and today on the show, we have the founder of Supply, Patrick Coddou. Patrick, welcome.

Patrick:

Thank you for having me.

Stephanie:

Yeah, we’re excited to have you on. I was doing a little bit of LinkedIn stalking and your background… At first, when I stumbled on your LinkedIn, I’m like, “Is this the right guy?” I saw a background in selling fighter jets and I wanted to start there with you of kind of like a little bit of your background before you founded Supply.

Patrick:

Sure. So I spent my education as a mechanical engineering and before starting this company, I spent eight and a half years in the corporate world. I worked in the aerospace industry and in particular I worked on military aircraft. We make some fighter aircraft here in Fort Worth, Texas where I’m from.

Stephanie:

Very cool. And what does that look like behind the scenes of working on aircraft? I saw that you did, I think an $8 billion deal. So I want to hear a little bit more details around that.

Patrick:

Yes. I worked on it. It would be very, very arrogant of me to claim that I was responsible for that deal. Yeah. So in general, and I’m happy to go deeper if you want to, but in general, the US government works with foreign militaries to arm and equip them with certain pieces of equipment that we think that are necessary for them to have and to support interoperability between allies. So one of those aircraft was called the F-35. And I think the deal you’re talking about was maybe the deal with South Korea we did probably five or six years ago where the US government sold, I don’t remember how many, 60, 70 aircraft to South Korea.

Patrick:

So that was a really phenomenal experience getting to fly there and negotiate with our partners over in South Korea and spent a lot of time kind of immersing myself in their culture. Just a cool, cool thing to be a part of. So I learned a lot there, but at the same time was ready to get out when I left.

Stephanie:

Yeah. So let’s hear a little bit about you’re almost a decade at, I think Lockheed Martin and you’re starting to get the entrepreneurial itch. So what was happening while you were there and what had you make the jump.

Patrick:

Yeah. So as outrageously cool as the subject matter was of what I worked on in my previous life, it was… As awesome as the subject was, it was as equally terrible to work in a corporate environment like that one for me personally. Not for everybody, but for me. And especially working with the US government. Just procedures and processes and just layers of bureaucracy. It just led to boredom and frankly anxiety and depression personally. Just wanting to be fulfilled in my work and not finding the ability to be so in what I was doing.

Patrick:

I tend to plan and think ahead a lot. When I visualize the future of my life there, it was like I could literally see myself sitting at the same desk like doing the same things that I had been doing for like the next 30 years of my life. For years, I wasn’t raised as an entrepreneur. I don’t really have that in my family. I didn’t know the first thing about starting a business, but for years I was always thinking about kind of what is kind of my path out of this life and kind of into the next one.

Patrick:

I always had ideas and never really kind of jumped on them because I wasn’t a risk taker, I was an engineer. Taking risk was the furthest thing from what I was used to. And I finally have this idea for a razor that I wanted to invent, and we can kind of get into that if we want to, but in general I’ve always kind of struggled with irritation and ingrown hairs with shaving since the first day I started shaving. I came across this old style of shaving, shaving with a single blade safety razor and just fell in love with it and decided I wanted to try to kind of make a modern version of this old razor that I found.

Patrick:

Then in addition to that just decided like this is kind of… It’s kind of now or never to make the leap from this job to doing something on my own. So it was kind of a perfect storm of the idea came and the necessity came and the opportunity came at the same time and just decided to go for it.

Stephanie:

Yeah, that’s awesome. I think a lot of people probably have those same feelings of getting stuck somewhere. I know I have in the past. There was a point in my previous life when I was working at Fannie Mae and I had the same kind of thing. I’m like, “Oh my gosh. Do I want to end up in a semi-government job or corporate job?” And even at Google, it’s like, “Oh, things feel so great right now. Should I leave? I feel like I’ll stay here for a long time because it’s so comfy.” So I think a lot of people have the same kind of feeling of now or never. I better jump before I get stuck here for the rest of my life.

Patrick:

And the further you go in those career paths like the harder it is to leave. What can an aerospace engineer that has worked as an aerospace engineer for 20 years do other than that after they’ve been there so long?

Stephanie:

Yeah. I had the same feeling. What year did you start Supply or did you start something before then or was Supply your first company?

Patrick:

Yes, Supply is my first kind of real company. Prior to starting Supply which we started in… The company started in January of 2015, but we launched publicly in August of 2015 with our first Kickstarter campaign. And prior to that, I started a website with one of my best buddies called razorpedia.com and that was like, I think, we started in 2012 or 2013. Long story short, it was a kind of razor review website that really was kind of a… Just kind of a stupid fun thing to do with a buddy on weekends where we wanted to kind of test razors and try to find the best razor on the market. Actually, the website ended up getting pretty popular and we ended up selling it later. But that’s really where the razor kind of story began with shaving.

Stephanie:

Yeah. I mean, I read that the Razorpedia was like the number one google search result and it had like 1 million organic page views over 30 months. So it sounds like it was actually a pretty big deal.

Patrick:

Yeah, it was pretty successful. We were fortunate enough to like… We literally launched I think the same week that Harry’s launched.

Stephanie:

Good timing.

Patrick:

Yeah. It was good timing and we wrote a blog like the same week about Harry’s. We ended up like kind of being… If you searched razor reviews online or Harry’s razor review, we were right at the top of the search results. So it was kind of dumb luck. So we started to kind of monetize it with ads. We didn’t know what we were doing. We were making it up as we went. The best thing that came out of that was the realization that all these multi-blade razors that we tested were all… In my opinion, were all trash and just not good razors. It was that website that actually led me down the path to find this old style of shaving, which is this single blade style shave.

Stephanie:

It’s really interesting how marketing can really train us like “Oh, the more blades the better, and this one has two. Oh, this one has three.” You wouldn’t even think like getting back to the roots of like you’re talking about a single blade is maybe actually the best way of doing things.

Patrick:

Yeah. There’s an old Onion article from like 2002 and I think the most blades in a razor was maybe three or four at that time, and the title of the article was Screw It, We’re Doing Five Blades. So they actually foresaw the five blade razor. I think you can actually buy a seven blade razor today.

Stephanie:

Oh my gosh. So you have this idea of Supply. What did the early days look like? I mean you have this old-time razor where you’re like, “Oh, this actually works really well.” What was it like to actually start the company and find a way to create and manufacture this razor?

Patrick:

It was very challenging to say the least. So I had the good fortune of one of my friends. I wanted to just make the leap and just go cold turkey and go all in on the company and the idea from day one. I had the good fortune of having some friends in my life that I listened to that said, “Why don’t you try to figure out how to make this product work before you just leave your paycheck behind?” That turned out to be really good advice because it took me about a year and a half if not two years to go from Kickstarter campaign, which was kind of the initial rough prototype to no kidding supply chain or product that I could actually sell at scale.

Patrick:

I have no background in consumer products at all, whatsoever. So a lot of that kind of two-ish years was just me making it up. I had no investors. I had no real network or people to rely on to help me figure out how to kind of make this product. So a lot of it was just kind of figuring it out as I went and making a lot of mistakes and fixing those mistakes when they happened.

Stephanie:

So how were you finding ways to… I mean, you get a really well-funded Kickstarter. What was the next steps after that? Did you go and start meeting with people who manufacture razors already and you’re like, “Here’s my new design idea?” Or since you’re an engineer, were you actually like trying to make your own?

Patrick:

Yeah. No, I did not make my own. We’ve always done outsourced supply chain and production since day one. We’re currently actually not working with any of our early manufacturing partners. We’ve got a really phenomenal network of manufacturers that we work with today. But in the early days, it was a lot of googling although that doesn’t really get you too far when it comes to manufacturing.

Patrick:

And then just a lot of calling and cold outreach to anybody that I could get to pick up the phone. So I think I probably called somewhere around 50 or 60 different suppliers that I just found through Google or recommendation from somebody who would talk to me, but didn’t want to do the work for me or something like that. I eventually settled on… And this is a very common practice in the consumer products space. I eventually settled on… I never really know what to call them, but kind of an outsourcing kind of middleman sort of company where they’re a… This is what they do is they go find factories to make you your product.

Stephanie:

Oh, interesting.

Patrick:

Yeah, I found a guy local to me. I don’t remember how I found him. I think he was on Upwork maybe and he managed the manufacturing of our first batch for me.

Stephanie:

Very cool. So what led you to change manufacturers? You said in the early days, you had one manufacturer two and then you don’t use them now. What happened and what kind of lessons did you learn through switching manufacturers?

Patrick:

So we launched our campaign August of 2015. I promised delivery by March of 2015, and that was in my mind plenty… That was more than enough time. That was like I was being generous with that timeline. And the manufacturer knew that. They were on track with that. March came and went. No products. April came and went no products. May. And then June I finally… I’ll never forget, he literally shows up on my doorstep with a big old dolly of… I think we had ordered maybe 2,000 razors or something like that and he drops him off inside my house. Then as he’s walking out the door, he says, “Oh, by the way, there’s a problem within.”

Patrick:

I’m like, “Oh, now, you’re going to tell me there’s a problem.” Anyways, it turned out there was an issue with the razor to where if it wasn’t used properly, it actually wouldn’t even really shave at all and you couldn’t load a blade.

Stephanie:

Oh my gosh.

Patrick:

Yeah, just a little problem, which was just devastating because I had already spent all my money that I had raised, I think about $8,000 on that production batch. Essentially what we did over the next kind of two to three months is I set up a little shop in my garage to try to kind of adjust the razors to make them work and we did the best we could with that. We were very open with our backers and that’s always like number one thing. I always tell young founders or operators is like when things go wrong trying to cover it up or not being honest about it with your customers is just going to make it worse.

Patrick:

You need to kind of be honest. We were telling our customers what’s up like here’s what happened, here’s what we’re trying to make right about it. Oh by the way, if you want to wait, we’re going to start up a second batch with a new manufacturer, but it’s just going to take some time.

Patrick:

Anyways, we ended up kind of salvaging some of that initial bash. We ended up having to scrap a lot of it, lost a lot of money on that first batch and then we started up a second production line and eventually made it right with our backers and delivered everything we promised, but it took… I think it was the following March before we finished delivering what we had promised. So it took a year longer than what we had told people it would take. The lesson for me is and has always been at the end of the day, all I have personally that’s keeping my business alive is the relationships with the people that I work with.

Patrick:

Those relationships and that trust is everything. It’s extremely difficult to, on the front end, determine if you can trust somebody. But I always highly leverage towards trust when I’m evaluating a new partner rather than capability, right? Because capability is just kind of table stakes for us to even have a conversation. Something is going to go wrong and what happens when it goes wrong is what makes all the difference.

Patrick:

So that first vendor, his true colors were showed when something went wrong. The vendors, I’m with now, things go wrong all the time, but what happens is they make it right. So that’s kind of the biggest learning lesson for me and the biggest advice I can give people is going into business with people that you not only enjoy working with, but can trust to make things right when things go wrong because that’s literally all you have. What’s written on the contract doesn’t even really matter when you’re as small as me, right? Because I can’t sue somebody. It’s just… Anyway.

Stephanie:

Too much time, too much money to even try and do that to begin with.

Patrick:

Yeah, exactly. So it’s all about relationships.

Stephanie:

Yeah, that’s a really good point. So on your Twitter I think I saw that… I mean, you guys have been in business for a few years, but 80% of your lifetime profit has come in the last six months and I was wondering what’s the catalyst behind that? Why are all the profits coming in now? Is it better marketing? What’s behind the scenes to drive that profit now?

Patrick:

Two things, supply and demand. So on the supply side, I worked all last year. This is another kind of big learning point. I’ve gathered over the years. I worked all last year to significantly improve our gross margins or essentially how much our products cost to make versus what we sell them. The first four basically years of my company, I wasn’t charging enough for my products and they were costing me too much to make. So 2019 was a big kind of cost cutting year for us.

Patrick:

Then in addition to that… So those cost cutting initiatives went into effect on November 1st. So that’s the supply side and then the demand side is November 3rd we aired on Shark Tank. So that was the beginning of a big tidal wave of orders. So those two things coincided very nicely to bring us to a place to where we’re significantly profitable in the way that we’ve never been before and that really changes a lot of things for us.

Stephanie:

That’s awesome. So how did you go about figuring out what areas needed to have cost cut down? What does that process look like?

Patrick:

Yeah, for us, I mean it’s less about… We’ve always had very low overhead. Started the business with my wife. We’ve barely ever paid ourselves much… We’ve had a very small team always. We worked out of our house for the first three years. So overhead has always been very low for us. I always, always, always urge young businesses and founders to keep overhead as low as possible. I think a lot of the reason you’re seeing a lot of companies go out of business or have issues this year since COVID hit is they don’t have the flexibility in their overhead to withstand volatility in the marketplace which is what’s going on right now.

Patrick:

So that’s always been low for us. It’s always been a thing that I’ve held important. What it costs us to make our products versus what we charge for them, I had what I’d consider a friend/mentor get on a phone with me. He runs a very successful men’s clothing business that’s probably 10 times larger than mine. He shared with me, “If you’re not charging at least 4X for your products what you make them for, you’re never going to be able to scale in a meaningful way because customer acquisition costs are just too high to let you be able to scale with any less margin than that.” And he’s right.

Stephanie:

Did you take his advice exactly and do 4X of how much it costed you?

Patrick:

Yes, I did.

Stephanie:

Cool. And what was the price before for a razor and what did that jump to?

Patrick:

Without getting into the engineering side which is maybe a little boring, but we didn’t really necessarily change the price of the razor. We have two versions. We have what we call an alloy version and a steel version. The steel version we increased the price probably about 20 to 30% and we introduced an alloy version which is a lot less expensive to manufacture and we actually kept and almost kind of lowered the price on that one because we were able to bring our production costs down so much.

Stephanie:

Got it. When you’re lowering your production costs, I know you mentioned overhead is a big thing, but was there anything with your production costs or the materials that you also looked at decreasing the prices for?

Patrick:

No. I mean, we kind of kept the packaging the same. Another thing that you’ll probably hear a lot of people, supply chain guys talk about is we’re always trying to get like ahead of the curve when it comes to ordering because historically we’ve always had to rush shipments via air. Not all of our stuff, but a lot of our stuff is made overseas and air shipments cost anywhere from five to 10X more than ocean shipments. So that’s always really painful when you got to spend 20 to 30 grand just to ship something versus two to three grand.

Patrick:

So getting better forecasting so that we can order far enough ahead of time to put something on the ocean instead of the air is another big thing we’re doing. Otherwise, it’s just like constant… I live in my profit and loss statement where I’m just counting every single penny that goes into my cost of goods sold whether it’s the cost to ship to me, whether it’s cost to ship to my customer, the fees I’m getting charged by my credit card companies, cost of my boxes.

Patrick:

I mean, it just requires relentless dedication to constantly being in the numbers to make sure that… It’s just like… It’s like entropy. All things tend towards chaos. Well, everything in your P&L tends towards higher costs if you don’t stay on top of it because you’re just going to spend more and more money.

Stephanie:

Yeah, I completely agree. I think a lot of founders oftentimes avoid looking at it because, one, it’s kind of hard to read a P&L or a balance sheet or something like that if you haven’t taken the time to figure out what all the line items mean. But then also like you said like a lot of things start adding up behind the scenes whether it’s subscriptions or just stuff where you’re like, “Whoa, I didn’t realize my credit card fee is this.” Maybe it’s actually cheaper just to you know get a loan or do this and start thinking differently about how you’re spending your money. Because a lot of those costs do add up especially in the early days.

Patrick:

They do, and software too.

Stephanie:

Oh, yeah. Software is a big one. And forecasting. I thought that’s a really good point about forecasting in a way that you don’t have to airship things. We actually haven’t had someone on the show talk about air versus ocean, so I found that very interesting.

Patrick:

Yep.

Stephanie:

So the other thing I was wondering I would love to hear more about is your Shark Tank experience. We’ve had quite a few Shark Tankers on here and everyone’s had a slightly different experience. I want to hear a little bit about what that looked like.

Patrick:

Awesome. I mean, it was a once-in-a-lifetime sort of deal. Never will forget it. We had a blast. I went on with my wife. We both pitched. We filmed in June of last year, so June of 2019 and then we aired in November of 2019. Just all the way through from the very… I applied three years in a row. It took me three years to get on the show and from the first day I applied the first time all the way through the last interaction I had with them after filming, it’s just a really class act. Up and down, just phenomenal people.

Patrick:

I’m not talking necessarily about the sharks, although they’re all great. You work with them for literally 30 minutes to an hour. You never see them again, but all the people behind the scenes are just a class act. Just the experience of standing in front of these people that you’ve watched for close to a decade, if not more than a decade on TV and actually talking to them and them talking back to you and saying your name. It’s just like this very kind of out of body experience to where you kind of like in a sense like black out a little bit. Like don’t even really remember what happened, at least personally. But we had an absolute blast. We ended up getting an offer from Robert and accepted his offer. We actually didn’t end up closing that deal, but just had an absolute blast.

Stephanie:

Oh, and you said you didn’t end up closing it?

 

Patrick:

No, we did not.

Stephanie:

I think that’s also interesting to know that not all the deals close and there’s things that maybe happen afterwards that could impact that on both sides.

Patrick:

Yeah. About half of them don’t close.

Stephanie:

Yeah. So what was it like after you went on the show? I’m sure you had a large increase in demand? Did you guys have any website issues or inventory issues or what did that look like?

Patrick:

Yeah, a huge increase in demand. I think in November, we did you know 4X our previous monthly record. So big increase in demand. It really strained our customer service. It strained our supply… Not our supply chain, our warehouse a bit although we had just onboarded with Shopify Fulfillment Network. They were doing a phenomenal job of keeping up with things. It was more of what was straining was getting stuff in stock from our vendors on time.

Patrick:

So we had some orders that took us like three to four weeks to ship and that made some customers pretty upset since they were Christmas presents. We did get everybody everything they needed before Christmas which was like my one thing that I wasn’t going to sacrifice on. We ended up getting it done. But between November 3rd and Christmas, it was pretty painful, in a good way. But the response was pretty phenomenal.

Stephanie:

Yeah, that’s great. And are you seeing continued demand from that or did you start leveraging other maybe customer acquisition strategies or marketing tactics to kind of build on that demand?

Patrick:

Yeah, so it really put a ton of wind in our sales. It’s really helped us kind of upgrade a lot of our business kind of to the next level. But in terms of like sustained demand, no, you’re not getting a ton of like post Shark tank people streaming it and coming to your website. Although, I’m sure that happens. What it has done for us is it’s given us kind of a social proof of being on this national platform.

Patrick:

So we’ve used a lot of footage and assets from the airing in our advertising. So if you go to our website, you’ll probably get retargeted with some Shark Tank style ads. And just in general, it’s given us the ability to taking us from this quiet kind of nobody brand to… I won’t call us a household name, because we’re certainly not, but a lot more people recognize us like, “Oh yeah, I’ve seen that before.”

Patrick:

So it helps with everything. I mean, it helps with not only the company but your partners and your vendors are now even more excited to work with you. Press finds you that hasn’t found you in the past. We’ll be in The Wall Street Journal this weekend.

Stephanie:

Oh, cool.

Patrick:

We are in GQ’s best single blade razor of 2020. These things just kind of slowly snowball. It’s been a really phenomenal experience. We’re very grateful for it.

Stephanie:

Yeah, that’s great. It’s such a good reminder of how PR can work if it’s done the right way because there’s all these PR companies who always say that they can help you, but it depends and that’s just a good reminder that it can work well if you get the right outlet and getting featured in like Wall Street Journal or places like that. Very beneficial.

Stephanie:

So what kind of digital channels are you finding the most success in right now when you’re going about… You’re talking about retargeting and different marketing tactics. What kind of channels are you finding success in?

Patrick:

Sure. I mean, no surprise Facebook, Instagram and Google in that order for volume. We’ve always wanted to test these other channels like Snapchat and Tik-Tok and whatever and we probably will sooner or later. But there are some other things we want to spend some more time on building before then. We do a little bit of affiliate. We do a tiny bit of influencer, and that’s really kind of I think what we’re going to start turning our eye to for maybe the next phase of our growth. But yeah, those are really the big channels for us.

Stephanie:

Yeah, cool. So when you were building up supply and you mentioned Harry’s earlier. The razor market feels like it’s been pretty popular for people to start companies in. You’ve got Dollar Shave Club, you’ve got Harry’s. How did you think about that competition and making sure that you stood out among the other brands that were launching?

Patrick:

Yeah. So our value proposition is very much kind of anti-Harry’s and anti-Dollar Shave Club. Then our positioning and our pricing is similarly the complete opposite. So they’re clearly competitors of ours, but I don’t really consider them necessarily direct competitors. What I do consider them is people that I can steal my customers from. So it’s a single blade. I haven’t really talked much about the product. It’s a single blade.

Stephanie:

Yeah, let’s hear about that.

Patrick:

Yeah. It’s a premium single blade razor and the value propositions are there’s a few. Number one, it’s not a cheap product. It’s a $75 handle, but the value prop is you invest a lot up front, but then you save tons of money over time. So our blades are 75 cents a piece and they last somewhere between eight to 10 shaves. So after you buy the handle, you’re spending… If you’re shaving every day, you’re spending maybe 24 bucks on blades a year. Then you’ve got this handle that lasts forever. We actually guarantee it for life.

Patrick:

So you never have to buy the handle again. But then aside from that, the value prop is a single blade gives you just as close of a shave as a multi-blade razor. But for roughly 30% of guys, they experience like myself a really severe razor burn and or bumps typically on the neck or in the sensitive parts of the face. And a lot of that is caused by multi-blade razors. We don’t have to go that deep into it, but the way they’re designed is works for some guys in terms of giving you a close shave, but for guys like me who have sensitive skin, it actually does the opposite. It makes things worse for you.

Patrick:

Anyways, so going back to Harry’s and Dollar Shave Club. So a lot of guys, they just use these razors and they just think like this is the way everybody shaves and they just have to deal with this issue and just deal with the razor burn or just not shave. So what we’re telling them is no, it’s not the case. You can actually shave and enjoy it and not have your face be a train wreck after you shave.

Patrick:

So we’re slowly helping guys kind of wake up from this myth that multi-blades are better and that’s like the only way to shave. If it doesn’t work for you, then too bad. Just keep shaving and tearing up your face.

Stephanie:

Yeah. How are you going about that education process because I was going to say that it does seem like there’s quite a bit of education required for that and just for like… I mean, you mentioned shaving eight to 10 times. I’m like, “Oh, I think a lot of people probably shave with the same blade for long time.” I’m thinking about myself, I’m like, “Oh, man. I’m pretty bad at that.” So how do you go about getting people to change their behavior?

Patrick:

Yeah. Honestly, it’s tough. I mean, I’ll give you an example. We present in our ads like why multi-blade razors are bad for your skin and we literally present it the same… We present the same data that Gillette presents. It’s on their website. Multi-blade razors are literally designed to lift… The first blade tugs the hair out of the skin and like the second and third blade kind of cuts it below the surface of the skin. That’s literally how Gillette has designed them to work.

Patrick:

People accuse of us of lying and making that up. And it’s like, “No, just google it.” You’ll see it straight out of the horse’s mouth. So the point is like it takes a lot of education. When they don’t even believe that you’re just saying what your competitor says, clearly they they need a lot of education.

Patrick:

So we do it through video. For example, if you buy the razor, you get four emails from me, the first four days after you buy it and each one is a short 60-second training video. It’s not like this outrageously complex course of learning how to shave with our razor. It’s 60-second videos. But guys, we’ve learned are very prone to throw instructions out so they don’t read anything that we include with the product.

Stephanie:

You think they fancy videos like you call them, “Hey, come look at this.”

Patrick:

Exactly. It continues to be a challenge, but in general video seems to work the best in terms of teaching guys how to do. And actually, we’re starting up our YouTube channel next week to kind of help that process as well.

Stephanie:

That’s really interesting. Another thing I read. I don’t even know why I know anything about razors because I did read an article about the marketing behind them, how a lot of the traditional companies show the razor getting like water all over it and sitting in the shower and that actually degrades the blades and then you have to change it more frequently and that was like their whole plan. Do you think that’s true or am I just reading conspiracy theories behind razor blades?

Patrick:

Yeah, I don’t know exactly what you’ve read, but I mean it is true that water, what it does, I mean, if it sits on a blade it causes it to rust which degrades the edge. I mean, we tell our customers don’t leave your razor in the shower in a damp environment. We tell our customers not to do that because that’s very… That’s true.

Stephanie:

Yeah. I mean, all these things I think most people probably are doing right now, I’m thinking of myself and our producers typing in there that how long she goes from changing her blades. So I think there’s a lot of education to do in the market in general. How are you guys also thinking about new products because these are designed for men, but I’m like women definitely have a lot of the same issues. Are you thinking about launching new products geared towards women as well or are you just strictly focused on men’s products?

Patrick:

The short term, we’re focused on men’s products. We do have women as customers. My wife and my co-founder is a user of our product. So we’re more than happy to have the ladies buy from us. But what’s really, really difficult or at least I’ve found is to position our product as both a men’s and women’s product at the same time. I don’t know the best. I’m sure there’s a good way to do it, but I don’t know what it is because shaving your face and shaving your legs are too… They seem similar, but they’re very, very different things.

Patrick:

I’d love to do like maybe different landing pages or product pages because the value props are basically different, right? So I don’t know, man. Maybe I could use some advice for how to sell… Maybe the problem is I just don’t know yet how to sell razors to women.

Stephanie:

It sounds like my team. We’ve got ideas and we’ll team up with your wife and we can all figure it out together.

Patrick:

Yeah, yeah exactly. It is on the to-do list. It’s just something we haven’t been able to get to yet.

Stephanie:

Very cool. So tell me a little bit about how you developed your website like the experience… I mean, when you’re selling something that kind of needs to be tried out or you need to hold like the handle to see like wow, this is a good quality like piece of steel here, how do you convey that to the customers who are coming on and how did you develop your website experience.

Patrick:

Yeah. It’s tough, it’s really tough. I don’t think we’ve arrived by any stretch, but certainly, certainly made a lot of progress. We have a very, very talented development company. We work with agency called Fuel Made. Good friends, just good people and they do amazing work. So they handle just from the front end and the back end design. They’re handling most of that for me.

Patrick:

Prior to that when we were smaller, I think it’s a complete, complete waste of money to spend any money on complex web design. There are so many free or very cheap templates out there that work so well. I would encourage people to not spend any money on development and take any money you have and invest it all in creative and start with just phenomenal photography.

Patrick:

Find a very, very talented photographer and spend your money there if you’re going to spend your money anywhere. So I have a very good friend of mine who is that person and he takes all of our photographs. And so we over index on beautiful photography. We’re now at a point to where we can afford kind of an expensive agency to develop our site and otherwise, we do just tons of AB testing. Every month, we’re testing something new or we’re launching a new feature. Sometimes it works, sometimes it fails miserably. Each month is just an opportunity to get better.

Stephanie:

What kind of tests have you seen work versus fail because I think a lot of people may be thinking about trying out some of the same kind of features or tests that you’re thinking about. So is there anything that comes to mind where you’re like this really worked well with conversions or increase cart value versus this one did not work at all and it seems like it would have.

Patrick:

Yeah. I probably have more this didn’t work than this does work.

Stephanie:

Let’s hear it. I like those stories just as much.

Patrick:

Well, man, I’m really sad about this one. We just did one where once you add the razor to the cart, there’s a pop-up that immediately shows up that says, “Hey, do you want to upgrade this to our starter set which is our second best seller aside from our razor?” We tested different variations of that pop-up. We tested it against no pop-up and there was like no clear winner after, I think it was two weeks and a very significant amount of traffic. No clear winner.

Patrick:

So we decided not to go with that pop-up. I launched a membership/loyalty program in April. The way I designed it was outrageously complex and I put a lot of development work and dollars into it, let it run for eight weeks and then I canned it. That was painful to do because it was just too complex.

Stephanie:

What made it complex? Because I’ve actually heard similar themes from a few other people who’ve been on the show who said that they thought that a loyalty program would work for them, but it ended up not working like they thought. So what do you think made it too complex or would you have done it differently or are you just like, “We’re not trying that again?”

Patrick:

Yeah. Two things on the front end and on the back end. So on the back end, the code, it was completely custom designed from a code using scripts on Shopify and it just got really complicated. But on the front end, it was kind of confusing to the customer. So the program was essentially like it was kind of like buy a razor and get a free lifetime of blades offer which sounds like a really compelling offer, but there’s always kind of… There’s got to be a caveat to that statement.

Patrick:

So it was like you could get a shipment every quarter of blades, just pay for shipping or you could buy our premium membership, which was like 20 bucks a year and then get the blade shipped to you once a quarter, which is a great deal, but offering them those two options was really confusing and then just the way we made them sign up for it was confusing.

Patrick:

In general, we’re going to try to launch another program in the future, but it will be far less complicated. If you can’t explain it in a sentence or less and have people get it immediately, then you’ve set yourself up for failure. And that’s what we did. I’ve explained the program to people and they’d be like, “Okay, wait. But if I buy this, what happens?”

Stephanie:

I need my Google spreadsheet out like which way will I save an extra dollar?

Patrick:

Yeah. So anyways, things that have worked. We actually launched international currency on our website because we do a pretty big chunk of business overseas and that actually increases conversion rates quite a bit for us. I’m blanking right now. We’ve had other wins, but I’m blanking on it right now.

Stephanie:

That’s all right. If you think of any more, we can circle back because I actually think it’s very interesting diving into some of these tests like this because I’m sure other founders are thinking about similar tests.

Patrick:

For sure.

Stephanie:

Very cool. So a couple general Ecommerce questions. Now, that you’ve been in the world for a while and kind of doing a bunch of tests and you launched your company, what kind of trends or patterns do you see coming down the pipe right now especially with everything with the pandemic. Are there any changes that you see coming in the future around Ecommerce?

Patrick:

I guess this is probably cliché, but the only thing I know is that I have no idea what’s coming next. I think there’s a ton of opportunity in the future and a ton of volatility in the future for Ecommerce. I’m very, very grateful, number one to be in the industry I’m in to continue to operate and be healthy and growing. I have friends in the restaurant business that cannot say that.

Patrick:

So I’m very bullish and grateful for the industry I’m in. I’m not planning on changing anytime soon, but at the same time, I think consumer behavior is going to continue to be like challenging to kind of forecast. People say this all the time on Twitter, but I just don’t get the fact that our stock market is so high and our GDP is so low and so many people are out of business.

Patrick:

To me, it’s like, okay, when is this… Part of me is waiting for the other shoe to drop and when is this all going to come crashing down and the other part of me is like eCommerce is 30% of retail now and like that’s not showing any sign of stopping anytime soon. So I don’t know if that’s a direct answer, but in general what I’m doing is I’m doubling down. I’m building processes and teams for growth.

Patrick:

So we actually just left our long time marketing agency that I had a great relationship and love and really enjoyed working with and it was really difficult to leave them. But the main reason I left is like I’m convinced the brands that are super nimble and able to react and adapt really quickly are going to be the ones that survive and thrive in this environment, in this volatile environment.

Patrick:

So whether Facebook CPMs are up or down or what’s going on, I think we’re just going to be really flexible and part of what I’m doing to be flexible is building more internal teams to move quickly rather than just being a bit slower.

Stephanie:

Yeah. That’s such a great point and I think a lot of other companies are probably starting to think about that too especially around like being able to move quickly and not having costs that are recurring for like the next three years that you can’t get out of or long-term contracts and even around like not relying on just a single manufacturer and being able to kind of like move around if needed. So definitely being more nimble will probably be how a lot of companies are thinking about this going forward.

Patrick:

Yeah, and it’s tough because at the same time you also, I think… We started the call off kind of like this, it’s like you have to keep overhead low at the same time. So you’ve got these competing priorities to be able to move fast and have an internal team, but then also not have a bloated internal team that you just can’t respond. Your overhead can’t respond quick enough to any kind of unforeseen events.

Stephanie:

Yep. Completely agree. So is there anything that you wish I would have asked you that I did not bring up?

Patrick:

Let me see. I don’t think so. No, nothing I can think of.

Stephanie:

Man, I’m just the best. All right. Cool. Then we can move on to a quick lightning round, if that sounds good.

Patrick:

That works for me.

Stephanie:

All right. So the lightning round brought to you by SalesForce Commerce Cloud. This is where I will ask you a question and you have a minute or less to answer. Are you ready, Patrick?

Patrick:

I am ready.

Stephanie:

Cool. So if you were to start a podcast, what would it be about and who would your first guest be?

Patrick:

Okay. I know the answer to this one.

Stephanie:

You’re prepared.

Patrick:

This is no offense to you at all.

Stephanie:

All right. I’ll try not to be offended.

Patrick:

I would start not like a one-on-one podcast, but like a round table debate style podcast with roughly three to five people. I want vigorous like vitriolic… I don’t know if that’s a word, but debate. I want people that are so ingrained in their opinion that they’re willing to fight other people to the death about what they have to say. The topics would be all Ecommerce or retail related.

Stephanie:

Okay.

Patrick:

So anyways.

Stephanie:

I feel like I see that happening on Twitter right now though.

Patrick:

Yes, it’s Twitter and podcast form. That’s exactly what it is.

Stephanie:

Yeah. I see all these people getting very angry about stuff with certain Ecommerce or someone calls something like D2C and they’re like, “That’s not data saved.” I’m like oh my gosh.

Patrick:

That’s exactly what I’m talking about.

Stephanie:

That’s funny. We at Mission have done roundtables before, but they’re usually with like three CMOs and then one of us hosting it. So it does not get that heated. So I’d be very interested to see how your podcast goes.

Patrick:

Yeah, it would be a requirement for yelling to happen.

Stephanie:

That sounds great. What’s up next on your reading list?

Patrick:

Let’s see. I just downloaded been a book by Ben Horowitz. I don’t remember the name of it but it’s about building culture.

Stephanie:

Oh, yeah. What is that new one?

Patrick:

I don’t remember. But it’s all related to this kind of transition I’m going through right now is what I call a transition from founder to CEO and focusing less on doing things myself and focusing more about delegating and building a team that can accomplish things without me involved. So a huge, huge, huge part of that is culture and I have no clue how to build good culture. So I want to learn from the best.

Stephanie:

What You Do Is Who You Are?

Patrick:

Yes, that’s it. Is that new or is that old?

Stephanie:

Yeah. That one is his newer book. I was listening to it on Audible and I like it because it ties in history along with building a culture, but it’s like here’s what happened a long time ago and why these themes are still relevant. So I’d recommend that one as well.

Patrick:

So you liked it? That’s good.

Stephanie:

Yeah. I thought it was great.

Patrick:

Okay, good.

Stephanie:

What’s up next on your Netflix queue?

Patrick:

I don’t really watch a whole lot of Netflix.

Stephanie:

No? Nothing? Everyone always starts by saying that and they’re like, “Oh, wait. I just did this. I just watched this whole series.”

Patrick:

It’s funny. Me and Jennifer will turn on Netflix to watch something new and we always default to just watching The Office.

Stephanie:

That’s a good one. That’s a good go to, to Keep you smiling.

Patrick:

I will say we did just start. We dug up an old DVD set of Seinfeld and now we’re watching Seinfeld right now.

Stephanie:

Oh, nice. Pulling out the DVDs. That’s awesome.

Patrick:

Yeah, the DVD. Blu-Ray though, yeah.

Stephanie:

Yeah, got to be. What app do you enjoy most on your phone?

Patrick:

What app? I use twitter probably too much. It’s a good thing and a bad thing. A lot of the good things that have happened to me over the past year have been through connections on Twitter, but it can also be a time suck.

Stephanie:

Yes, I agree. All right. And then the last one, what is a favorite piece of tech that you use or a trying out that’s making you or your team more efficient right now?

Patrick:

More efficient. Well, we’re trying out a productivity app called ClickUp? Have you ever heard of it?

Stephanie:

I think I have. Tell me a little bit more about it.

Patrick:

It’s kind of like a monday.com or an Asana. So like project management, task management. I’ve never found one I like or that works. We’ve tried doing it in Notion before, although I love Notion. So we’re trying that in ClickUp. I don’t know. We’ll see. I like it so far.

Stephanie:

Cool. Yeah, we’ll have to check that out. We use Basecamp for almost everything, but I’m open to other things.

Patrick:

Go ahead.

Stephanie:

Oh, go ahead.

Patrick:

I was just going to say, I don’t know that I’m a huge fan of Basecamp. I could never get it to work for some reason.

Stephanie:

Yeah. It is a little high when it comes to like starting up and teaching the team and everyone learning from it, but it gets better.

Patrick:

Yeah.

Stephanie:

All right. Well, this has been such a fun interview, Patrick. Thank you for coming on the show. Where can people find out more about you and Supply?

Patrick:

You can find me on Twitter where I spend most of my time. My handle sounds like canoe. Because my last name sounds like canoe, it’s Patrick Coddou. So you can find me there and that’s really where I spend all my time. And then our website is supply.co. You can see our company and all of our products there.

Stephanie:

Awesome. Thanks so much and have a great day.

Patrick:

Thank you.

Subscribe in your favorite podcast app.

Love this? Share it with your friends!

Facebook
Google+
Twitter
LinkedIn

Up Next in Commerce is brought to you by Salesforce Commerce Cloud.

Respond quickly to changing customer needs with flexible ecommerce connected to marketing, sales, and service. Deliver intelligent commerce experiences your customers can trust, across every channel.

Together, we’re ready for what’s next in commerce. Learn more at salesforce.com/commerce

Subscribe to our newsletter.

Get exclusive updates and new episodes straight to your inbox. 

Subscribe Now To Get

– Our daily newsletter designed to increase your wealth, health, and wisdom.

– Access to exclusive giveaways from The Mission full of awesome swag and prizes.

Our Podcasts