This transcript was generated from the episode audio and may contain minor errors.
Hello, hello, what's up? This is Chris Guillebeau for Side Hustle School. Today is episode 273, rolling along throughout the year. If you're listening in real time, it is the 30th of September. I want to say happy birthday to my dad and also hello from London, where I have just arrived after an overnight flight from New York City.
Now, yesterday I told you a story of a woman in Long Beach, California who started a restaurant week. When she talked a little bit about the concept of restaurant week and how she noticed it was missing in her city, and since she worked in PR and was well connected with lots of restaurateurs and lots of media, she thought, well, maybe I'll be the one to create it. It's a great story. You should check it out. I just wanted to mention a couple of additional details.
She typically works with 55 to 60 different restaurants in the area each year, and the cost for them to register to be part of restaurant week is $350. She says most restaurant weeks charge $500 to $900, so she thinks it's a steal. That also covers advertising, collateral, posters, et cetera. She'll also work with 10 sponsors for the week, and there are two different tiers, $2,500 and $5,000. The higher tier gets their logo on the billboards and also just more prominent coverage in general.
And last, she also accepts what she calls in-kind options for sponsors, but they can donate some products in order to offset the cost of the buy-in. Just wanted to add those details to yesterday's story for anyone who was curious about how it worked. Today's story is about two college students who team up to create care packages for students. They call it "Study Box," and it's been a lesson in learning in addition to a profitable side hustle. That story is coming right up.
Remember the days of high school and college, when you were swamped with all kinds of responsibilities? Maybe you had a part-time job. Maybe you had extracurricular activities. And hopefully you had some kind of social life. In addition to those things, there was that little matter of studying.
All you ever wanted was more time and the ability to focus without watching cat videos on YouTube every 15 minutes. At least if YouTube was around when you went to college. What if you could have received everything you needed to study in a box? Well, it's too late for some of us, but that's what Craig Lamb and Logan Foster set out to do for their generation. As college students with demanding majors, Craig and Logan noticed that it was too easy to get distracted during study sessions.
Not having the right stationery, feeling hungry, and being completely exhausted by the rigors of student life were all common reasons for being unable to focus on the task at hand. And they knew they weren't alone. The study box was Craig and Logan's answer to the needs of the student. They started by writing down items that would be beneficial to have nearby during study sessions. That list included snacks, energy and sports drinks, highlighters, pens, pencils, post-its, flashcards, and Tylenol for that inevitable late-night headache or for the morning after.
They took a number of trips down to convenience stores to get an idea of the costs of each item. After that, it was just a matter of testing the market, which they did by offering prototypes to students on their campus. Based on the feedback they received from their first customers, they decided to stock each box with two snacks, a choice of beverage, energy or sports, an assortment of study supplies, peppermints, that Tylenol, and a monthly motivational quote. They began pricing at $14.99, and so many of the students came back and told them that the product was effective that Craig and Logan believed there was a market for study box. They also figured that it had a good chance for success if they could just figure out what to do next.
They contacted a local retail warehouse and ordered the items they needed for the study box in bulk, which lowered their costs significantly. These costs amounted to $200 for the first batch of inventory. Craig and Logan would assemble the boxes and then deliver them in person to those who ordered via their Facebook page. This wasn't the first side hustle for either Craig or Logan. Craig had previously launched an online wine store, which dropped ships' wine directly from the vineyards, while Logan had designed and sold phone accessories using fulfillment by Amazon.
That said, neither of them had ever had to handle the production process from product creation to sales. So even with a bit of experience, launching study box was a challenge. Their profit margin was about 25 percent, which means that they had to generate sales with a tight budget. And to be profitable in the long term, they'd have to sell a lot of study boxes. They also discovered another big problem.
Sales for study box were highly cyclical. Nobody wants to study during semester break, for example. Still, so far they've received a ton of positive feedback from their customers, and they sold more than 130 boxes in their initial launch. Their goal from the beginning has been to help students create a more productive college experience and in turn achieve greater academic success. Even though their product has only been up and running for a short time, Craig and Logan says it feels really great to know they're already making a positive impact.
Another rewarding part of this venture has been going through the process of building something from scratch. It's given both of them an opportunity to test out different ideas. The next step is to grow their customer base. They're reaching out to various universities in their area, trying to expand, and they hope to increase profit margins as well. They'll also be looking to reach out to local grade schools, on the theory that it's not just college students who need help with studying.
Maybe this doesn't end up being what they pursue long term, but the lessons they're learning will still be applicable in lots of situations. It's never a bad idea to try something new. So this side hustle has some pretty clear strengths and weaknesses. The strength is that these guys are college students themselves, they understand the market, they put together something that's relevant, and it seems they know how to reach people, at least some of the people who might benefit from it. They've also had a great early success selling more than 130 boxes in their launch.
The challenge here is going to be profit margins and scale, because you're going to have to sell a lot of study boxes to really make this sustainable in the long term. Now, not everything has to be sustainable. There are lots of projects we feature that just make money for a time, and then it stops, and the person goes on to do something else. That's a normal part of the side hustle way. I think the issue here is that in those situations, you want to make a substantial amount of money before you go on to something else.
And with a product that just costs $15, I think in some cases, they're actually discounting to $10, then they have to purchase those supplies, even buying in bulk. It's going to be a challenge unless they somehow end up selling a lot more boxes. Now, the other issue here is that there's no recurring income, at least as I understand it. From what I can tell, they're not actually doing this as a subscription model, they're just doing it as a one-off sale. That might be the one major thing that would make a huge difference in improving this concept, because if you knew you had 130 customers every month, for example, you'd be able to build off that.
You'd be able to count on that income coming in, and your entire focus would be on growing that subscriber base so that you'd make more money, but also so that you'd know how much money is coming in each month. Those are just a couple observations. As I said, it's a fun project, a good experiment, and you never know what'll happen. Maybe they'll actually go on to taking over universities and grade schools everywhere. We'll find out, but as I said, it's never a bad idea to try something new.
As always, inspiration is good, but inspiration combined with action is better. Today's show notes are at www.sidehustleschool.com/273. I'm Chris Guillebeau, Waving from London, for Side Hustle School.
