What I learned from starting an on demand snack delivery service

When I was 22 years old, I started my first business. The idea was simple: It would be a late night, on demand snack delivery service. I remember joking around with my friends at one point about having ice cream delivered, although it wasn’t until years later when I was living in Vancouver that this idea came to me as a business opportunity. I was binge watching Shark Tank (the show where entrepreneurs pitch their businesses to investors), and out of nowhere, the idea for an on demand, late night snack delivery service entered my mind. I figured that with the prevalence of pot smokers in Vancouver and with the large population, a business focused on junk food delivered at night would do well. I told a few people about the idea with mixed reactions, but I knew in my gut that it would work, because I was basically the demographic. For the first time, I had an idea for a business that I’d actually use myself, and I think that’s why I was so confident. I wasn’t trying to fool anyone or create fake value.

I knew I had to start it, but I had no money, and a few thousand dollars in credit card debt. I knew about a government funded youth entrepreneur loan program called Futurpreneur, and I contacted them about getting a business loan. The person assigned to my account kept asking me questions about how I’d proved that people actually wanted snacks delivered, and suggested more market research. He wasn’t convinced and I could feel it. I still felt very confident about the idea and I didn’t have the patience to waste time trying to convince this non believer.

There’s a big difference between asking someone if they WOULD buy something, and having them actually put down the money. As a hobbyist programmer, I knew that I could build my own online ordering system for free and that I didn’t really need that much money to start the business. Basically I’d just need to buy some inventory and start advertising. Only then would I know for sure if people were actually interested. Having a big buffer would be nice, but if it was going to hold me back, I wasn’t interested.

I took a three thousand dollar increase on my credit card and spent 3 weeks building my site. I bought a car on a credit card cash advance for $1000 and prayed that it would hold together. I went to the wholesale store and bought about $500 worth of snacks. I bought a few multi packs of chocolate bars, some 12 cases of Coke and Root Beer, and some assorted boxes of little chip bags and candy like fuzzy peaches. It was small, but I figured it was enough to prove the model. The website was simple, designed with stoners in mind. It was basically just a grid of snack images with a plus or minus button beside them. Once you had added items to your order, you could pay with your credit card right on that page and enter your delivery details. The pricing was pretty comparable to what you’d pay at 7-Eleven, but there was an $18 minimum order, and a $5 delivery charge.

Finally, I was ready to launch. I began by putting some money into Facebook targeted ads in Vancouver. I wasn’t even sure where to set my delivery zone since I had no idea how much demand there would be, so to begin, I just left it open ended. I figured that I would see where people ordered and eventually I’d find a good zone.

I put around $200 into Facebook ads over the first week, and for 3 long days, there were no orders. Finally on the fourth day, I got my first order. Of course, I was very excited and it went off without a hitch. The guy answered the door wearing sweatpants and no shirt, and was definitely stoned. Perfect! My market assumptions were dead on. That’s when things started to go crazy!

I woke up the next day to an email from the Senior Editor of a Vancouver based Buzzfeed style website called Vancity Buzz. She had seen my ad and was interested in doing an article on my business. Of course, she didn’t know that I had literally done one order at this point and the business was being run out of my bedroom. Vancity Buzz had 275,000 Facebook followers and around 175,000 Twitter followers, and I was very excited about the potential publicity.

My roommate and I started looking at their recent articles, seeing that one was shared by 500 people on Facebook. That being said, it was about Ebola, so we figured that there was very little chance mine would be shared quite as much. But still, it was a good sign.

The editor sent me a list of questions by email about why I started the business. I sent them back, and looked forward to the press. At that point, I remembered one small problem. I was about to get a ton of press, and I didn’t even have a business license. I quickly scrambled to apply for one, and the very morning that the article was posted, I received my business license from city hall.

By the time I first saw that the article went live, there were around 20 shares. A little later I refreshed the article and saw that it was up to around 35 shares. Then, I refreshed it again immediately and it was up to 45. My heart jumped a bit as I kept refreshing the page and seeing the number climb. At first I honestly thought it was a glitch that was adding some number to the shares every time I loaded it, but as the day went on, I discovered that it was not a glitch, and the article was actually going viral. By the end of the first day, the article had a few thousand shares, and by the end of the next day, the total number was around 8500 total shares on Facebook, with almost 10,000 page views to my website.

Of course, I was not expecting this type of traffic, and did not build a website capable of handling that traffic spike. When I loaded the site, I saw a gross, unreadable error message about ‘too many database connections’, which meant that at least a portion of the people trying to view the site were probably caught with that error instead of seeing my menu.

I also didn’t have any type of retention plan for site visitors at the time like an email sign up form or a coupon offering to entice visitors to come back another day for an order if they weren’t ready to place one today.

Nevertheless, I received 12 orders that night (compared to 1 total order previously). The common theme of the day being unpreparedness, I also quickly realized that my current system for receiving orders was quite flawed. When someone placed a successful order, I would receive an email saying ‘Congrats, an order has come through from john@smith.com’. That was it! I wasn’t expecting to be getting multiple orders per hour yet, so I hadn’t even considered that I should build a system to actually email me ALL the order info, but instead, just a notification that SOME order had gone through. This meant that I had to drive back to my house, go on my desktop computer and manually check my database for the order details. Even within my database, the data was a bit mangled and I had to painstakingly decipher the items in the order and write it down on a piece of paper.

Since I didn’t set a delivery zone, I was getting orders all the way from West Vancouver to Coquitlam, and in case you aren’t familiar with the area, that’s a 40 minute drive with no traffic (and Vancouver isn’t generally known for it’s lack of traffic).

I ended up calling my room mate while I was driving and getting him to check my database for me so that I could plan my routes. It was brutal. It was quite exciting, but it was probably the most stressful night of my life, and I was totally overwhelmed.

The next day I had another 12 orders come in and by that point I enlisted some help from my room mate who would drive my car for me while I planned the orders and navigated, just to reduce the stress.

I had to do a full restock from the wholesale store almost every day for the first week just to be sure that I wouldn’t run out of certain things. I even ended up doing a radio interview on a popular Vancouver radio station. After a week, the average daily order was down to around 6 or 7, but the business was now real and I was earning money!

At one point, my friend helped me fit a full size fridge in the back of my Acura hatchback, with about 60% hanging out the back, and somehow we managed to make it home.

I began expanding my menu, and trying to figure out where my actual delivery zone should be. I started with just the city of Vancouver, but when things began to slow down a bit more, I opened up to officially supporting North Vancouver and then even Burnaby. My reasoning was that I need to live off the profit of this business, and I’d rather be driving to North Van for an order than not doing any at all!

This worked out in the short term, but after almost a year, I was having days where I’d do 15 or 16 orders, and was really screwing myself over with delivery times. My promise was 1 hour delivery, and when you get 2 orders that are 30 minutes away in opposite directions, it’s really hard to know how to handle it, especially since I started offering ice cream on my menu, which has about a 25 minute melting window.

After a year, I was tired, fairly broke, and had gone into thousands of dollars of debt from facebook ads and spending money like an idiot. Each order on it’s own was profitable, but I was not being the frugal entrepreneur I should have been.

Eventually I read a book called The Lean Startup, which is all about how to iteratively run experiments on your customers to optimize your business into success. I knew I needed to find a way to scale the business, but I didn’t have the money to hire a full time driver, since some days I would get 5 orders and some I would get 15. In retrospect, I definitely should have taken the plunge and hired a driver within the first few months, but I was in a mindset of scarcity and I was getting a bit too mentally exhausted to make the right decisions.

I met some great guys with an outsourced delivery service who would have been able to complete all my orders for me, but their delivery zone was limited to the downtown core, and due to the nature of my business, most of my customers were outside that zone. I had dug myself quite a hole, since my zone was too big for anyone else to be willing to deliver to it.

I began to experiment with pricing, menu options, delivery zones, and other things to slightly annoy my then loyal customer base in the spirit of optimization. I didn’t do it correctly though, because I wasn’t really measuring anything enough or doing one specific thing at a time to know what was working and what wasn’t. Since the business wasn’t really growing that much anymore, I started to question if I even wanted to run the business anymore. I thought about how business owners should be passionate and I started to ask myself if I wanted to be the ‘snack guy’ forever. I was interested in more high tech stuff and in the end, I slowly killed the business by caring less and less about it until it was no longer working well or making me happy.

Finally, after nearly 2 years, I officially closed the business. It was a hard decision and as sad as it was relieving. I moved on to a new chapter, but there will always be a place in my heart for SnackEasy.

Reading this over, I’m not sure if this story is funny, entertaining or depressing, but I hope it’s at least one of those things for you.

In the end, it was probably still my most formative adult experience, and I don’t regret it. If I had to do it again, I’d start it with a partner right away, and aim to hire drivers as soon as possible to avoid burnout.

If you feel like starting a snack delivery business, let’s talk. I’d be happy to be your strategic, non delivering partner.

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