Eric Shannon: In my previous business, we had worked with a guy who has a workshop in California. This guy is just a world-class expert when it comes to polyurethane, which is what foam is made of. In his workshop, he’s been making furniture and bedding since the late 1970s.
I went to him and said, “Here’s what I’m looking to do. I’m looking to do a bed and I’m looking for a manufacturing partner to make this for me. The specifications are, number one, it has to be big enough for big dogs. Forget about the flattening issue. Most beds that were being made just, literally, didn’t have enough surface area to contain a Mastiff or a Great Dane.
The second thing was, we have to be able to put a 10-year warranty on it because I wanted to eliminate that flattening problem.” I knew it could be done. We just had to use high-quality materials and engineer the bed right so that it can hold up to the weight of a 200-pound dog for long periods of time. It had to be made in America and only using American foam.
Sramana Mitra: What were the terms? You basically hired this guy as a contract developer to do your product design?
Eric Shannon: Yes.
Sramana Mitra: It’s design and manufacturing?
Eric Shannon: Kind of. I gave the specification, “Here’s the end result I’m looking for. You help me figure out how to do it.” He was a critical component in designing the bed.
Sramana Mitra: How long did it take you to get all this squared away so that you could start selling?
Eric Shannon: Not very long. I would say six months.
Sramana Mitra: How much inventory did you build with which you started selling?
Eric Shannon: Very little. Our initial inventory purchase was less than $5,000.
Sramana Mitra: What was the price point?
Eric Shannon: It goes from $200 to $400.
Sramana Mitra: Were you going to sell this online only?
Eric Shannon: At that time, yes.
Sramana Mitra: So $5,000 worth of inventory, you put together a website, and you launched the brand. When was this?
Eric Shannon: Our first sale was in November 2012.
Sramana Mitra: What happens next?
Eric Shannon: The very first thing we did in November 2012 was, we put up a very basic website. It’s comical how bad our first website was. We also put the product up on Amazon. Initially, I wanted to focus on Amazon because one thing I learned in my experience is go where the buyers already are. That’s easier than creating your own pool of buyers.
We had a website, but the website just directed people to Amazon. We were able to get sales from day one just on the strength of Amazon’s sponsored products. We started buying ads on Google AdWords and sending them to the website, which then sent people to Amazon. Then it was just a matter of waiting till you get a good base of reviews.
Sramana Mitra: You were using Amazon’s marketplace to sell your product?
Eric Shannon: In the beginning, yes.
Sramana Mitra: How far did just selling on Amazon take you?
Eric Shannon: I don’t want to get into exact revenue numbers.
Sramana Mitra: Did you cross a million dollars with that strategy, or did you have to move outside of that strategy?
Eric Shannon: We’re way beyond that.