I've been reading the book Four Winds by Kristin Hannah. It is a story about a woman and her children during the Dust bowl followed by the Great Depression. The book paints a picture of the struggle people endured during this time in history. It is amazing the sheer determination and toughness people had during that era. People were literally 'dirt poor' but refused government help and would do anything for work even if it was only a few cents a day. Families couldn't afford shoes for their children so they fashioned them out of cardboard - an old tire if they were lucky. There were migrant camps in California for people that were forced to leave Texas and Oklahoma. Locals treated them poorly and were unwilling to help. Even if they were lucky enough to find a job, it was never enough to get themselves out of the tents they called home. Many in the camps were sick but couldn't afford health care. Babies were dying of starvation and disease. America had few labor laws at that time, so children often worked the fields along side their parents. Food was scarce. Many survived on just beans, rice and flour. They learned to live without, worked extremely hard, and prayed for better days.
When I feel like times are hard, I like to reflect on this story. Things can feel awfully bleak these days with gas prices, inflation and the bitterness that seems to be invading many of us. But I do know, that there have been worse times in history and we certainly aren't struggling to the degree that Americans did during the depression. (Yet) 🤔
Running our small business has some hurdles that just keep getting harder to jump over. We are proud of the fact that Queen B/Miller Organics has been in business for over 4 1/2 years (2 1/2 of which were during lockdowns and a pandemic). It might not seem like much of an accomplishment but according to the U.S. Bureau of Labor Statistics, 21.5% of small businesses fail their first year. Only about half of businesses manage to reach their fifth fiscal year. And there aren’t many businesses that manage to stay open for a decade. Those are some sobering statistics and I have a feeling that they will only get worse for small businesses.
So what kinds of things are small businesses struggling with today?
Yes, we get it. Everyone is feeling the pressure of inflation. But in small business it affects EVERYTHING. Our ingredient costs have gone up at least 30%. Our cute custom boxes have doubled in price so we had to make the decision to go back to plain boxes. (Boo!) Our bottle and jar costs are up 20-40%. Labels, tissue and bubble wrap? Cost is up at least 10% on those as well. All of our utility costs are up, subscription services for our websites have increased. If we don't raise our prices on our products, our profit margins will just keep getting slimmer. At some point it becomes senseless to stay in business if we can't afford to pay our employees or our bills with revenue earned. The knee jerk reaction is to raise our prices but that can be a fine line. Raise them too much and we won't sell a thing. We are searching high and low to find ways to cut costs with still being able to provide quality products.
The effects of the pandemic punched us hard in the gut right away. We spent countless hours desperately trying to find the same bottles and jars that we usually ordered. Everything was backordered and not expected for months or even longer. We've had to make changes to some of our products because we can no longer get them. For example, our hero product Pain B Gone has been in a frosted glass jar for years, but they are impossible to find now. So we switched to a white plastic jar. Not that big of a deal, right? But once we change a product's container, that means new labels and new professional photography so that our pics match the new look. All of this is expensive and time consuming, not to mention frustrating. We are STILL struggling to find ingredients and containers today. I cringe every time I need to place an order not knowing IF I will be able to find it AND what it will cost this time.
Everyone knows that shipping costs have gone through the roof and yet everyone wants free shipping when they shop online. (Me too!) We offer free shipping on orders over $49 and a $5 flat shipping fee on all other orders. I feel like we need to continue to offer this in order to stay competitive but the costs are becoming unbearable. Once again this affects our profit margin.
We love our employees and we couldn't do what we do without them. Our employees never start at the minimum wage and we try to give raises at least 2X a year. But now, we can't even hire a high school student for less than $12/hr starting. According to U.S. Small Business Administration, the real cost of an employee is 1.25 - 1.4 times the salary. That means $12/hr actually costs our business between $15 - $16.80 when you factor in payroll tax and insurance coverage. These days we consider ourselves lucky when we actually find people willing to work hard, are good at what they do and show up. So hats off to our current Queen B Team - we do appreciate you!
This is where small businesses get hit with the all the feels. Our products are truly handcrafted. We do not have large bottling lines, robots that whip up batches, or fulfillment centers that quickly fill orders. It's just our little facility with a handful of people that pour their heart and soul into every aspect of the business. We know that you can run to Walgreens and purchase a bottle of lotion for a fraction of our prices. We know that you can go on Amazon and order a porch full of products and get it shipped to you for free in two days. We just can't compete with the big guys on pricing. We have to spend a lot more than our large competitors for everything that we use to create a product. For example, we purchase bottles in groups of 200, whereas L'Oreal makes a bottle purchase in the hundreds of thousands. That means they will get tremendous price breaks while we are forced to pay a premium price. This happens with everything we purchase. The little guy just has to pay a lot more.
The reason for this blog post is to not garner sympathy. Even if we have to close the doors tomorrow, it has been a great run. I have learned so much and feel blessed to have been able to build this little business. It is a joy to be able to create products that help others and to be able to connect with people all over the country.
So what is the reason for this post?
Well, we hope that this post gives you a little insight into the struggles small businesses are facing. While companies like Aveeno and Dove will more than likely survive even as people tighten their belts, the same can't be said about many small businesses. At some point, the profit margin will be too little for small businesses to afford to stay in business.
We also want to say THANK YOU to all of our customers for the last 4.5 years. Your support, referrals, reviews, social media likes and shares, and purchases have not gone unappreciated. Yes, it is true that every time my phone dings that someone just placed an order - I do a happy dance! Pretty sure the CEO of Dove doesn't even flinch when you purchase a bottle of their soap.
We would also like to thank our store dealers that share our products all around the country. Without their support I'm not sure where Queen B would be today. We acknowledge that they too are small businesses that are jumping over those ever growing hurdles.
So for now, Queen B is hanging in there and we are hopeful that the economy will turn around. It certainly isn't as bad as what Americans endured during the Great Depression. I can only hope though that I will have the same tenacity as Elsa in Four Winds should that day arrive.
Please consider shopping small and once again thank you for supporting family businesses like ours. ❤️
"Every time you spend money you’re casting a vote for the kind of world you want." – Anna Lappe
Bridget Miller is the founder of Queen B and assists her family in the day to day operations of Miller Organics LLC.
Former teacher, author wannabe, forever a mom, and business owner.