Operation Pigeon Lust: Day Two

Day One was great. I committed to the idea of running an e-retail site. I was encouraged by several offerings of support from friends (both emotionally and work-related). I learned several keys to building a successful e-retail site. Things, overall, were off to a good start.

Day Two has been more sobering. It was not all bad, however. A few good things were accomplished. I deposited the cash that will fund this fledgling company and keep it alive for the next few months. Another positive, I was contacted by the software company that makes the shopping cart software I am thinking about using for my site. Their sales rep reached out to me and explained all the benefits of the software. Given the price tag and all the software's great benefits, this seems like one decision that will be easy to make.

On the downside, it looks like I will have to tie up more cash in inventory than I would have liked. In order to get wholesale pricing from vendors, I will have to purchase in large quantities. Perhaps it was naive, but I thought I might be able to offer their products without actually holding inventory by drop shipping. Though I have not confirmed this, I suspect that I won't even get the benefit of credit terms because my company is new and has no credit history. Based on some rough guestimates, I might have to use up to half of my available cash on holding inventory. This is not good news.

I also came to realize that there will be more startup costs than I first anticipated. For example, in order to run the website software, I need to have either Dreamweaver or FrontPage. This should have been obvious, but I overlooked it. So, there's another $200 - $400 I need to spend. I know this is the nature of business, so I am not entirely surprised. It just stings a little.

Overall, while today was tough in terms of the lessons learned, the picture is still fairly bright. I have enough money to get up and running; however, I won't have as large a cushion as I initially thought I would.