The Magic of Tiny Business

You Don’t Have to Go Big to Make a Great Living

Sharon Rowe
Berrett-Koehler © 2018
168 pages
[@] getab.li/31768
Book:

Rating Take-Aways

8
8 Applicability • Eco-Bags Products, seller of reusable shopping bags, typifies a “tiny business.”
7 Innovation • “Like a tiny house, a tiny business is built by keeping a laser focus on what you deem
8 Style essential.”

• Entrepreneurs who run tiny businesses can have fun without pressure and can make
a good living. They can be positive, upbeat and optimistic.
 
Focus • Tiny businesses depend on incrementalism – taking tiny steps to move ahead.

• Owners of tiny businesses can plan their lives to allow for free time and vacations.
Leadership & Management
Strategy • Firms in the tiny business category must be professional and watch their numbers.
Sales & Marketing
• Tiny business owners worry about what they must do – not what would be nice to do.
Finance They try to see challenges as opportunities.
Human Resources
IT, Production & Logistics • Sharon Rowe, founder of Eco-Bags, believes in “co-opetition” with similar companies.
Career & Self-Development
• When Rowe appeared on Oprah Winfrey’s TV show, Eco Bags’ annual
Small Business revenue jumped from $700,000 to $2.2 million.
Economics & Politics
Industries
• Protect your tiny business by registering your trademarks and other intellectual
property.
Global Business
Concepts & Trends

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getabstract

getabstract
Relevance
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What You Will Learn
In this summary, you will learn:r1) What Sharon Rowe’s journey with Eco-Bags Products demonstrates about tiny
businesses, and 2) What strategies will help you start, run and sustain a tiny business.
getabstract
Recommendation
Entrepreneurs must have courage, optimism and an elevated sense of mission. Sharon Rowe demonstrated these
qualities when she started her tiny business Eco-Bags Products. She had little money, not much time (she was a
new mother) and no business expertise (she was an actor). Thanks to her hard work, daring and perseverance – not
to mention low-interest credit cards – Eco-Bags Products is now a multimillion-dollar enterprise. With charm and
grace, Rowe explains how this all came to be in her instructive, insightful and down-to-earth manual. She describes
her business processes and mind-set in detail so other entrepreneurs can gain practical wisdom and inspiration from
her experience. getAbstract recommends her compelling narrative to entrepreneurs, both actual and wannabe.
getabstract
getabstract

getabstract
Summary
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What Is a “Tiny Business”?
Most people work to make a living, but many dislike their
jobs. They’re unfulfilled and unhappy. If you’re in that rut, establishing a tiny business
may be your road to a more satisfying life. Owners of tiny businesses bet on
themselves. However, deciding to go into business for yourself can be daunting. It
getabstract
takes courage, creativity, patience, persistence, discipline, a good plan and a strong
“A Tiny Business purpose. That sense of purpose is crucial for tiny business owners. “Like a tiny house, a
is about building
something agile and
tiny business is built by keeping a laser focus on what you deem essential.”
profitable, on your own
terms, so that you…can A tiny business doesn’t mean a one-person enterprise with a single, hard-pressed and
be home for dinner.”
getabstract overwrought entrepreneur working nonstop out of a bedroom while barely covering
expenses. A tiny business can make a great income, hire a coterie of employees and
enable the owner to maintain a schedule that includes time off and vacations. But, like any
company, a tiny business demands paying attention to the basics, setting priorities, being
committed and never compromising on your principles.

As you plan your tiny business, you may not know exactly what you want, but
you probably know what you don’t want: pressure, stress and around the clock
craziness. Tiny business entrepreneurs don’t buy into the idea that commerce is a take-
getabstract no-prisoners, zero-sum activity. Often a tiny business is the practical embodiment of
“Tiny is a laser- what its founder wants to achieve in life., as long as that includes seeing challenges
focused, disciplined
approach centered on as opportunities. These entrepreneurs often find that they can expand their firms at a
making your work work reasonable pace and that they exert a lot of control. They know growth is good, but “not
for you.”
getabstract growth at all costs.”

Tiny businesses are not merely pathways to paychecks. Owners focus on profit as they learn
not to waste time on nonessentials. They want to see their companies grow, but not at
the cost of their integrity or their personal lives. These businesses often reflect their
owners’ concern about bigger issues. They can be “magical” and bring their founders joy
and happiness.

The Magic of Tiny Business                                                                                                                                                           getAbstract © 2018 2 of 5

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 Sharon Rowe and Eco-Bags Products
When Sharon Rowe started Eco-Bags Products in 1990, she didn’t realize she was creating
a great example of a tiny business or that she could build the company into a multimillion-
dollar enterprise. Rowe worked on her own terms, prioritizing her family and her time off
getabstract
“A new concept may for vacations and other activities outside of work.
not feel right or ready,
and the best way to
find out if it has legs is Prior to venturing into the business world, Rowe was an actor. She did well, but earned little
simply...to take that first money. Then, she had a baby – a fulcrum point in her life. Though she had no commercial
tiny step.”
getabstract training, Rowe decided to abandon her acting career and start a business. Her goal was
to make a good living while contributing to making the world a better place. Rowe was
determined to ensure that her baby and her family life always came first. She wanted to
manage her own time, and she didn’t want to mortgage the present for the future. Her big
idea was to introduce the idea of reusable shopping bags to America. She’d first encountered
similar bags in France, and she thought the idea was good for the environment.

Tiny Business Satisfactions

getabstract
“Tiny Business is… Rowe’s new business satisfied her in three important ways:
not an easy, by-any-
means-possible, get-
rich-quick approach. 1. “I found something I was passionate about (my ‘why’)” – Rowe knew she wanted
It is weighted in your to help the environment, in this case, by ridding it of plastic bags.
values and takes a long
view requiring patience 2. “I started a business that was a solution to a problem (more of my ‘why’)” – Plastic bags
and persistence.” do a lot of ecological damage.
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3. “I used my own resources (my ‘how’)” – Rowe spent her own money to bootstrap her
new business. She relied on credit cards to get over the tough spots.

Starting Out
Rowe gave herself three months to make Eco-Bags Products work. After that – if it didn’t
work out – she’d have to find another job. She asked shopkeepers near her home if they liked
getabstract
“If you…want your the idea of reusable shopping bags. Many did. She lined up a German manufacturer to
work to matter and produce the bags she had in mind.
you want to make a
good living, or you
want to build your own On Earth Day 1990, Rowe launched her tiny business. She offered Eco-Bags for sale at a
business while keeping
family and other life
street fair on Sixth Avenue in Manhattan. She sold out her entire stock in four hours. This
experiences a priority – street exposure led Newsday to mention Eco-Bags in an article. This valuable publicity
then a Tiny Business is spurred massive mail-order sales. Soon, Eco-Bags Products was profitably partnering
for you.”
getabstract with Stow Mills, a giant natural-products distributor. Rowe’s new business was off and
running. Then she discovered a basic truth about her new enterprise: Her products
weren’t running the show. Consumers were driving it by reacting positively to her
company’s aspirational story, its purpose, product and positive impact. Rowe began to
participate in natural-products trade shows. This paid off in new business touchpoints from
retailers and marketers.

getabstract Then Came Oprah

“I didn’t want to pay to
play...I was unwilling to
In 2006, sales of Eco-Bags Products went through the roof when The Oprah Winfrey
make compromises to Show featured them on a telecast. Rowe had decided to hire a PR firm and spend big
work up the corporate money – $4,000 monthly for four months – to get her product mentioned on Oprah.
ladder.”
getabstract The occasion was the first show that Winfrey devoted to Earth Day. The show’s positive
publicity pushed revenues for Eco-Bags Products from $700,000 to $2.2 million annually.
To handle the increased business, Rowe hired three new employees and moved her firm to
a bigger, more costly office.

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 The Recession
However, things were not always rosy for Eco-Bags Products.
The company was careless with expenditures. It didn’t produce forecasts and
budgets. It didn’t prepare for the future. When the Great Recession hit, it couldn’t
getabstract have come at a worse time for the company. Rowe’s firm was overextended. Eco-
“Put your vacation
time on your personal Bags Products had no cash reserves. Its revenues fell by half. To deal with this
and work calendars distressing situation, Rowe hired a new CEO, Alan Shapiro, a capable executive with
with as much notice as
possible.” a strong reputation and vast experience. She cut her own salary to zero. Eco-Bags
getabstract Products reached out to its partners, suppliers and customers, brought them up to speed on
the business impact of the recession, and explained the steps it was taking to turn things
around.

Once Eco-Bags Products moved beyond the recession, Rowe hired Mac McCabe, a
former L.L. Bean executive, as the firm’s “go-to financial guy and forecaster.” With
McCabe on board, Eco-Bags Products bases its business decisions on forecasts and
margins. As McCabe explains, “If you understand your numbers and how those numbers
getabstract impact results, you will almost always improve your odds for success.”
“You need to be
able to pivot quickly.
Agility matters. If an When Competition and Cooperation Combine
opportunity comes
your way, your ability Like many other companies, Eco-Bags Products took a big financial hit during the
to respond quickly is recession. However, it had already carved out a viable position in the marketplace. As a
important.”
getabstract result, other firms began to enter its sector. Rowe’s company welcomed these competitors
to join Eco-Bags Products in “cleaning up the planet one bag at a time.” Eco-Bags
Products executives based their decision to act this way on a “co-opetition” strategy that
puts competition and cooperation together.

Onyeka Obiocha, director of innovation for Yale’s Center for Public Service and
Social Justice, developed this concept. As an example of how cooperating with the
competition can work, Eco-Bags Products sold and promoted its rivals’ bags, and they did
getabstract the same for Eco-Bags Products. By partnering with them, Eco-Bags Products made it easier
“To get out of a
practice that may for its customers to depend on its brand for all their “reusable bag needs.” That’s a big
be hindering you… win for all involved, including the environment. Rowe believes, “It’s a losing proposition
replace it with a new
one that is enjoyable
to try to own a whole category.”
and rewarding.”
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Tiny Business Insights
Rowe learned valuable lessons and gained practicable insights as a tiny business
entrepreneur:

• Watch your timing – Don’t start a new business when you are under pressure or have
your hands full with other matters.
• Take tiny steps – Incrementalism is a watchword for any tiny business.
• Do cooperative marketing – Target brands that work with yours for co-marketing.
getabstract • Stay ready for downturns – To prepare, increase your cash flow, take your foot off
“If your business failed,
talk…about why it
the accounts-payable pedal, press down hard on the accounts-receivable pedal and ask
failed and what you suppliers for extended terms. Be transparent with your employees, especially if you must
know now that you cut back on their hours.
didn’t know then.”
getabstract • Prioritize what you must do over what would be nice to do – Your
time is precious. Focus on needs, not niceties. Choose “just fine” over “perfect.”
• Heed the 80/20 rule for tiny businesses – For every 80% of good results, allow yourself
20% to “trip, stumble, or fail and reboot.” The rule means “20% of your customers make
80% of your purchases” and “20% of your advertising delivers 80% of results.”

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 • Make weekly checks – Monitor your personal and professional priorities on a weekly
basis. Doing it daily is even better.
• Control cash flow – Without cash, your business will fail. To monitor cash
flow, calculate predictable expenses “in advance against a forecast with historical
getabstract
figures.”
"What if they sell and • Measure your risk tolerance – To assess your risk-tolerance, ask: What is your current
promote our brand level of financial security? How long do you expect it will last? How much money do you
and we do the same
for theirs?...What if need to operate? Will this change in the next few months? Can you afford to lose money?
we take a cooperative, How much could you lose before you’d be in trouble? Can you go without money now?
generous stance and
ask the same of them? If so, how much? If the money stops, can you still have a reasonable life?
What if we practiced • Enlist legal and accounting professionals – Retain an intellectual property attorney to
co-opetition?"
getabstract protect your trademark and similar rights. Guard your brand. Hire an accountant and, if
applicable, form a partnership with a manufacturer. Every firm needs a bookkeeper
to organize its record keeping and a CFO to handle forecasting and budgets.
• Protect yourself legally – Never depend on oral agreements. Register your brand in all
of its variations. For example, Eco-Bags Products registered “Eco-Bags, Eco-
Bag, ECOBAGS” and “ECOBAG.” Create a Google Alert that will monitor the
Internet for appearances of your trademarks. Prepare a cease and desist letter and send
it if someone transgresses your trademarks.
getabstract • Put profits back in the firm – Your profits are your income minus your expenses
“When you set out
in a direction, with and salary. Don’t spend your profits on yourself. Invest them in your business. Set up a
purpose and intention, pro forma, a projected monthly income statement detailing your revenues and expenses.
opportunities tend to
arise that are in sync • Set up basic “brand assets” – You need a LinkedIn profile, a two-sentence business
with what you’re doing. summary, a 120- to 150-word professional biography, a 300-word professional
Like magic.”
getabstract biography, a head shot in high- and low-resolution formats, and a commercial website.
• Compete for awards – The more exposure you secure, the better. Do your best to
win commercial awards. Nominate yourself, as Rowe did.
• Preserve your free time – Block out time in your schedule. Allow plenty for vacations.
• Attend trade shows and conferences – Participate whenever and wherever you can.
These gatherings provide business connectivity.
• Prepare for the future – Maintain low overhead expenses. Heed forecasts. Don’t expand
until you’re sure you’re ready. Save for emergencies. Create positive relationships with
getabstract banks for easy access to loans.
“I intentionally grew
a Tiny Business from
a tiny idea into a Share Your Business Experience
profitable multimillion- Share your success story with other tiny business entrepreneurs. Think
dollar operation at
my own pace, while of this as participating in a cycle of courteous reciprocity. Speak publicly about your tiny
prioritizing family and business. The most effective way to share your experience is to tell stories, which
vacations.”
getabstract will resonate with your audience more powerfully than facts and figures. Share your
knowledge by mentoring or coaching entrepreneurs who are beginning tiny businesses.
Deliver speeches about your tiny business at local universities, civic clubs, libraries
and chambers of commerce. Take any opportunity that come your way to spread the “magic
of tiny business.” This will be effective advertising for your enterprise, and you may inspire
others to start their own tiny businesses.
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About the Author
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Entrepreneur and speaker Sharon Rowe is founder of Eco-Bags Products, which sells naturally sourced bags at low
prices to make reusing resources a way of life.

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