This transcript was generated from the episode audio and may contain minor errors.
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Today's Throwback Thursday story is unlike any other. Welcome friends, so glad you're out there. Don't turn that dial. You probably don't have a dial, but you know what I mean, stick around. It comes from someone with a very long track record in logistics, manufacturing, international delivery and joy.
In fact, for over 1700 years, this side hustler has been at the helm of a vertically integrated enterprise best known for its high seasonal volume and elf powered production. However, all things change, even in the North Pole. That's why the Throwback Thursday series is all about how someone evolves their business and grows. How do you change? How do you adjust to external factors and so on?
I've been thinking about that a lot myself. No one is immune. And so in this special episode, we're gonna hear from the man himself, Santa Claus. That's right, the big man has made a business pivot after centuries of overseeing toy creation from the top down being a micromanager. He has stepped back from manufacturing entirely.
The elves have unionized. Santa just says, hey, it was time. So he now licenses his image name and Santa approved seal to independent toy makers across the globe. He brings the magic. They bring the creativity and craftsmanship.
He's now got passive income, less stress, probably a better tax structure. Let's hear a little bit about that, how it happened, what Santa learned while building out notion workflows and negotiating his licensing deals. Let's pass the microphone to a very, very special guest. I'll come back at the end with a few words of wrap up. [Music]
Hi, I'm Santa calling in from, well, you know where, my North Pole headquarters.
And yes, this is real. And for a while I've been ready to make some changes. For over 1,700 years, I ran the whole toy operation myself into end, design, production, quality control, fulfillment, all done in house, right here in our warehouses. We had a great team, mostly elves, a few reindeer specialists, but it was a lot of work. What most people don't realize is that demand has changed.
Kids want homemade wooden toys, but also Pokemon crossover dolls, vintage lunch boxes and demand for the new Nintendo Switch, it's off the charts. Simply put, we couldn't keep up with the niche requests. Frankly, the elves were tired. So last year they formed a union. And you know what, I supported it.
We negotiated a fair deal, shorter seasons, better cocoa breaks, and most importantly, I agreed to step back from direct production. That's when I came up with the Santa approved licensing model. Here's how it works, vetted small toy makers can apply to use the Santa approved seal on their packaging. It's not just a sticker, they get access to design templates, co-branding guidance, and of course, a little holiday magic. In return, I get a licensing fee.
Typically 4% of wholesale with the $2,500 annual minimum. I manage the whole thing in notion. Every partner gets a dashboard along with contract terms, renewal dates and naughty or nice compliance checks. I also have a page for brand guidelines. The use of red and green is encouraged, but not required.
So far we've onboarded 36 partners. One makes hand-carved trains in Vermont, another plush vegetables in Denmark. One guy in Argentina makes build a Yeti kits. It's delightful. The average partner pays about $4,000 a year.
Some pay more, especially if they do volume around the holidays. I made just over $150,000 last year, no sleigh rides required. That's great, of course, but more than the money, I love how this keeps the spirit of handmade toys alive. Kids don't need more plastic stuff from anonymous factories. Well, except for those game consoles.
They need stories, connection, and a sense that someone cared about what they made. Now, instead of running an aging supply chain, I get to amplify those stories. I still do Christmas, of course, but my sleigh routes are lighter, and I've even started mentoring a younger crew. There's a Mrs. Claws Run online shop, a gingerbread consulting collective, and we're testing out Santa Labs for seasonal pop-ups.
So yes, I've changed, but I'm still the same Santa. And I'll always believe in toys made with love, even if someone else builds them now. [Music]
Well, Santa, thank you so much for showing up. I believe we've had him on the podcast a few other times talking about other challenges and issues. 2020, we had this whole like, what does Santa do when he can't go into people's homes thing?
We had other stuff about his relationship with our partnership station and how it has helped him in lots of ways. I don't remember everything from all over the years, but this was a big one, Santa out sources. Listeners, hope you enjoyed it. Hope you're having a wonderful holiday season. If you don't celebrate Christmas, I wish you other happy holidays, whatever the season is.
I wish you a time of joy. And if you're just like, man, can we get through this year and start a new one? I hear you, I hear that. So a new year is coming up for all of us very, very soon. I've got some goals for January and beyond.
And as always, I'm wishing you every success as well. You know where to go for the archives. You know where to go to access those episodes, sidehustleschool.com. My name is Chris Guillebeau. This is Side Hustle School.
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From the Onward Project.
