Part 3: One Hen at Home

The Pembers Tackle Production and Pricing

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“Mom, I don’t know if we should get this. It might not be in our budget.” What I wouldn’t give to hear those words spoken in association with a pair of jeans! But my 14-year-old daughter’s comment was in regard to supplies needed for our One Hen business. The fact that Rachael was even thinking about our business budget made me realize just how much she has learned through our One Hen project. And having now reached the half way point, we both really feel like we are off and running, despite a couple bumps in the road.

 

Pondering our Products

Deciding on a product that we both wanted to make and sell was more challenging than we had anticipated. Initially, we had considered making candles, soaps and desk gardens. Based on the One Hen curriculum’s lessons on costs and marketing (modules six and seven), we knew that we needed to conduct a price analysis of materials, develop a tentative production schedule, and assess our target market and distribution chain before starting to create our products. (Translation: we checked prices at Michael’s Hobby store, reviewed the family schedule for upcoming commitments, and thought through who we would be able to sell to and where). After carefully evaluating everything, we decided to rein ourselves in and focus on one product – soap.

 

A Charming Solution

Once again proving that the One Hen product development lessons have had an impact, Rachael wisely asked, “How will our soap be different from any other soap?” To that end we decided that we needed to differentiate our product from others and brainstormed some strategies to do that. We decided to place a charm inside the soap. We both thought that this might incentivize people to buy our product since they would be getting something to use as well as something they could keep.

 

Customers and Customization
Guided by module seven’s activities on identifying target customers, we then conducted market research with some of our potential buyers. (Translation: during a family party, Rachael and I asked our relatives for feedback on the soaps’ look, smell, packaging, and price)We received lots of constructive feedback including the suggestion to market the soap to children, grandparents, party hosts, and as party favors at wedding and baby showers. One suggestion that we found particularly helpful came from my sister-in-law: “Can you tie the packaging of the soap with a ribbon that could be used to put the charm on?” Brilliant!

With our product and marketing strategy in place, Rachael and I set out to purchase the materials and dive into the production. As one might expect, there was a learning curve to making soap but Martha Stewart was there to help us via her web site. After the third bar was made, we felt like we had the process down. All in all, it was a fun project and working together reminded me of how wonderful it is to take on a creative project with my daughter.

 

A Pricing Pickle

Next on our agenda was getting down to business with some serious number crunching and estimating our product costs and expected revenue and profits. Calculators in hand, excel spreadsheet before us, we were armed and ready. Guided by One Hen’s lessons on product pricing, we tallied up the cost of materials and divided that number by the total number of soaps we could produce. Using this equation, Rachael and I determined that each bar would cost close to $2.00 to make and package — this was a surprise to us! In order to pay back our loan and have enough profit to donate to our charity, we would have to price the soap much higher than we expected. We feared that this price would be more than our customers were willing to spend.

 

Since our family’s soap consumer experience is limited to bulk purchases from Costco, Rachael and I decided to do some cost comparisons and, as such, will be forcing ourselves to go to the mall. In addition to a shopping trip, we will speak with two stores that may be interested in selling our soap to determine what price they feel would be appropriate. We will also check online for similar products to determine how they are priced. Our goal is to produce 20 bars of soap and sell them at a price that will allow us to turn enough of a profit to pay ourselves back and give at least as much to our charity.

 

All in all, we had a great week with our One Hen project. Rachael and I are still talking to each other and having fun.

 


 

This is Part 3 of a blog series that describes the adventures Hillary Pember had working with her 14-year-old daughter, Rachael, to complete the One Hen Academy program at home. In Part 1 Hillary shares how she first engaged Rachael in the One Hen project and in Part 2 she describes their process of building brand identity around their first mother-daughter business.

 


hillaryHillary K. Pember is a freelance writer living in Massachusetts. After working in management consulting for close to twenty years she decided to focus on her writing and take on the far more challenging (but far more enriching) job of staying at home with her three children. She is proud supporter of One Hen and through her writing hopes to highlight the vision and mission the organization holds dear.

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