Avid Baseball Fan Hits Home Run With Subscription Box

This transcript was generated from the episode audio and may contain minor errors.

[Music]

Welcome to Side Hustle School. My name is Chris Guillebeau. Hope you're doing okay out there, wherever you are in the world. Don't forget, you're not alone. There are all kinds of people out there just trying to figure out life, trying to figure out what's next and so on.

No matter what else is happening in the world, they want to invest in themselves. That's what our community is all about. So today's story, when an avid baseball fan and player spots the subscription box trend, he steps up to the plate and hits it out of the park. Okay, I know that metaphor was a little bit obvious, but anything else would have been a bit of a seventh inning stretch. Okay, at the end of the episode, I'll give you the three factors of a successful subscription box.

Lots to take away from this, especially if you're interested in physical products, serving a niche base, building something consistently over time. Because that is in fact, one of those critical characteristics. All right, we'll talk about it. Grand Slam subscription box. That story is coming right up.

[Music]

When Josh Band was a kid, he set himself the goal of playing professional baseball. He believed in betting against the odds, but he also knew the chances of getting into the major leagues were pretty low. There are thousands of hopefuls who want to make it, and only a select few who can grace the dugout of Yankee Stadium or Fenway Park. So Josh figured he needed a backup plan, and selling products online seemed to fit like a glove. I mean, I know it's obvious, but what else is it gonna fit like?

It's a glove. Back in 2015, the subscription box craze was taking off. These are those boxes where you pay a monthly fee and in exchange receive a bunch of swag and products. That fad started with cosmetics, but Josh noticed it spreading to other niches as well. He began to wonder why wasn't there a subscription box for baseball lovers like him?

Naturally, he decided that since there wasn't one, he could be the guy to step up to the plate and make it happen. He already had the perfect name, Plate Crate, a monthly box of baseball gear and greatness. He set aside $2,000 with the goal of making this dream a reality. In fact, he was so committed to hitting a grand slam that he was willing to go all in from the beginning, which to be clear is not our normal procedure or recommendation, but Josh didn't want a regular day job because he felt that would conflict with the hours he hoped to dedicate to his hustle. So instead, he picked up a series of odd jobs over the coming months, pouring concrete, shoveling snow and personal training.

He worked here regular hours, early in the morning or late at night, whenever he could, and that way he would devote regular business hours to his new venture. Plate Crate was far from an overnight success. To start, Josh had to find enough baseball-related products to satisfy his customers each month. He went straight to wholesalers and tried to bargain for the best price, but that was hard to do without volume, which he didn't yet have. Luckily, he was about to arrive at second base.

In his first month after launching, Josh had 20 customers, a successful start, but not enough to bring in the relief team. Those 20 customers brought in around $1,000 a month in revenue, which Josh fast-balled back into influencer ads, all designed with the goal to reach more baseball lovers. It turned out to be the right play, and revenue continued to increase quickly over the coming months. Josh was putting runs on the scoreboard. Now, Plate Crate as a business had a lot of moving parts, so wherever possible, Josh tried to keep it simple.

For one, he didn't spend much money on packaging. He simply used standard cardboard boxes with a black rubber stamp to brand them, and in fact, he did that for the first three years of the business before getting custom boxes made. Throughout most of that time, he was still working his odd jobs on mornings, nights, and weekends to make ends meet. Luckily, he had set up an office in his parents' basement, so his expenses were low. After more time, hours, and extra innings, the momentum started to shift.

Josh felt like he was getting close to the playoffs. Revenue kept increasing, and he'd nabbed discounts on several products. He also began ordering gear direct from China that was branded as Plate Crate, a huge move in making his subscription box more official. With a steady stream of revenue coming in, Josh decided to move to a small office space. It was largely a symbolic gesture.

He figured the rent and lease would keep him accountable. By now, it was 2017, and Josh was making enough to draw a salary from Plate Crate. Much of the credit was due to his new affiliate program. Josh would pay everyone who referred to subscriber $10. This quickly became one of the biggest traffic drivers to his site.

On top of that, his ability to generate discounts on products, now due to larger orders, as well as discounts on shipping due to high volume, means that Plate Crate is a flourishing business. It's definitely not a strikeout. In fact, in terms of side hustles, Plate Crate has become a heavy hitter. The business generated over $900,000 in revenue in 2019. While there's plenty of profit there for him to go full-time, and he's given away most of his other jobs, he does continue to do personal training a couple days a week, mostly because he enjoys it.

Josh didn't make it as a professional baseball player, but his side hustle game is ready for the World Series. [Music]

All right, hey, congratulations to Josh. Great job, I mean, this is really fantastic to build the subscription box to that level of revenue. So what are the common characteristics of those subscription boxes that managed to do it? Because of course, a lot of them don't.

And if you look through the archives, we've had a number of stories of successful subscription boxes. One of my favorites is the Korean Face Mask subscription, which is doing very, very well, tens of thousands of dollars a month. That was episode 705, number 705. So the three factors of a successful subscription box, number one, a sustainable membership base, okay? Which is probably self-explanatory, but the point is, if you've got this recurring revenue, which is good, you need to have enough people that are paying to be able to pay your expenses to make it profitable, and so on.

And the number for that may be different, depending on how much the subscription is, what you pay for those products, et cetera. But it's probably going to be at least a couple of hundred people. 'Cause if your average subscription box is 20 bucks, let's say, if you just have 10 members, like how Josh started, it's okay to start that way, but you can't continue that way, then you're not gonna be able to be sustainable. So you need that sustainable membership base, which is why it's so key to build that in the beginning and nurture it. And then you also wanna have a low churn rate.

Churn rate just refers to the number of people who are subscribing and then leaving. Like, are they leaving after two months? Are they leaving after four months, that's not good. The lower the churn rate, the stronger the business. Like, you want subscribers to remain subscribed for years to come, ideally.

So you want a sustainable member base, a low churn rate, and a continued source of products. You can't run out. Which I kind of wonder for something like baseball, like for years and years, like how do you keep coming up with stuff each month? But that's part of the challenge. So if you're thinking of having a subscription box, you wanna think, okay, let me look ahead to like a year from now and 18 months from now, do I think I'm gonna be able to find enough stuff or create enough stuff, somehow source enough stuff to keep that subscription box interesting?

Because I imagine if you keep sending people the same stuff, or if it repeats too often, then that contributes to that churn, right? So continued source of products is key. All right, listeners, thanks so much. You hit it out of the park every day. You're awesome.

Inspiration is good, but inspiration with action is better. This is episode 12.05. Therefore, our show notes are at sidehustleschool.com/1205. 12.05. Thank you so much for listening.

I'll be back again tomorrow. My name is Chris Guillebeau. This is "Side Hustle School." [Music]

- From the Onward Project.