Duped! Part 3 - How We Made Duping An Unbelt Easy

This is Part 3 of our blog series about discovering an Unbelts dupe, and what we’re doing about it. You can find Part 1 here and Part 2 here. 

Hi - Claire here, Unbelts' founder. Quick review: I'm writing this series in a spirit of hope, not bitterness. I want other business owners to know they’re not alone in fighting the uphill battle of keeping their unique designs protected, and for our broader community to understand just how much it means to small/medium businesses when you purchase their original products.

This post gets very real about why we’ve only offered three belt designs in 13 years of business, what I’d do very differently in Years 2 and 3 if I had a time machine, and how tough it can still be to *be* tough when things *are* tough. 

Sharing these reflections feels like standing in front of you in my underwear, and not the good matching stuff, either. Thank you for the absolutely lovely DMs and emails of support. You’re the best.

Lesson learned #1: Product innovation has many costs. Only one is financial.

To invent something new, you need some dollars, sure. But you also need creative bandwidth. When I started Unbelts, I vastly underestimated how much of each I’d need to keep iterating on our designs.

Here’s something I’m really proud of: Unbelts grew fast. I’d hit a niche for a non-plastic, stretchy, totally flat elastic belt, and we hit $100,000 in revenue within about a year of launching.

I had *no* idea that this was unusual for a business that started with a couple thousand dollars in capital. If I had, I would have immediately sought an investor and/or partner with enough scale-up experience to help Unbelts navigate what I now know were natural growing pains.

Our first barcodes, applied at my coffee table, as captured by 2012 camera phone

But at the time, I felt very much on my own. My creative brain was seconded to the systemization of belt production, sales, packing, and shipping. I hired an assistant before I started paying myself because, still living in Shanghai, I just couldn’t hack staying up ‘til 3 a.m. to make wholesale calls during the Canadian workday.

When I moved back to Canada in 2014 and had my first baby in 2015, we kept growing. It was exciting and gratifying, but the cashflow challenge was real. To prepare for sales demand, we needed our raw materials well in advance of sewing and selling - but our minimum order quantities (MOQs) were, and still are, high.

Checking for typos before ordering 3,000 labels = peak job stress

We had to have cash on-hand to order thousands of buckles and kilometres of elastic at a time, and reserve enough budget for sewing and packaging. Our largest wholesale clients required the most flexible payment terms, so the more we sold, the wider our cashflow gaps became. Somehow, we became B Corp Certified at this stage, and somehow, I kept my baby alive. Developing new products and investing in a brand-new set of inventory, however, was off the table.

Lesson learned #2: The bigger the risk, the bigger the reward. And the bigger the risk again.

Unbelts’ own cashflow push-and-pull was magnified at the beginning of COVID. I’d just appeared on Dragons’ Den; Oprah’s creative director had snuggled my new baby (Theo this time) at a trade show in Las Vegas; and we were hitting another growth spurt. We invested in a rainbow of Classic elastic for our colour-loving equestrian market and planned for a sunny year that could even - just maybe - culminate in being selected as an Oprah’s Favourite Thing (*dreamy sigh*).

Theo about to be shipped with our Dragons' Den packages

AND THEN. Enter March 2020 and the overnight closure of all of our retailers. Most of our online customers shucked off their jeans, pulled on leggings, and wouldn’t look back for the better part of two years. Our cash, in the form of mockingly cheerful, bright Classic belts, sat on our warehouse shelves while we pulled together a cloth mask collection on a shoestring and our suppliers’ good faith.

We blew dust off of this display for two years.

A lot of brands and retailers went out of business trying to ride the waves of supply and demand throughout the pandemic. We were almost one of them. It’ll be years before I can really write about doing business during COVID; in the meantime, know that we have 15,000+ cloth masks in storage, and if you ask nicely, I’ll probably pay *you* to take them.

Whimsical flatlay or desperate plea to buy an Unbelts - any Unbelt - along with that sweet mask? 

*SIDEBAR for product-based small business owners who are considering wholesale, but designed your pricing around direct-to-consumer margins: Beware any advice that sounds like “you’ll make half as much, but you’ll sell twice [or whatever] as many,” and actually run your numbers.

Example: You sell candles at craft markets for $30 each, or two for $55 (your most common transaction). One candle costs you $10 to make. 

• Units sold: 2
• Cash in:  $55
• Profit: $35

Most wholesale customers will want to purchase from at half your retail price, or even less. Let’s say you sell for $15 wholesale, with a minimum order of 12 units.

• Units sold: 12
• Cash in: $180
• Profit: $60

You’ve sold *six times* the inventory for less than twice the cash. You’ve also had to purchase more raw materials up-front to fulfill that larger order, and have somewhere to store/assemble them all. Other common wholesale costs include delayed payment terms, rep/agency commissions, and volume discounts. 

You may decide that the brand exposure makes the tricky margins and operational complexity worthwhile. Just make sure you’re clear on how much volume your cashflow can support, and that you’re clear on your true goals for the sales channel. I’ve seen a lot of new businesses grind in wholesales for years before realizing that they’re barely profitable, or actually losing money.

Lesson learned #3: We left a hole in the market for a cheaper (up-front, at least) competitor.

I’m going to throw down here and say that, with our kick-bum warranty’s free repairs and replacements, Unbelts are the cheapest-per-wear stretch belts on the market. However - our $45-59 price tag can be a barrier up-front. We offer payment plans, community donations, and Almost-Perfect sales. We can make exceptions. But we can never compete with a $15 lookalike without cutting corners in materials or labour quality.

We’re in the same seat as other purpose-based brands fighting lower-priced competitors in a tight economy. None of us are billionaires, because all of us believe in a diverse economy that benefits more stakeholders than the entrepreneur themselves. Time will tell what the best defense is: Laser focus on a single sales channel? An elevated brand position with cushier margins? Investment dollars for a rapid scale-up, with hope that self-sustaining revenue follows? There’s no wrong answer; we just hope there’s a right one.

• Lesson learned: TBD, TBH.

A key fob from our Loop line of accessories upcycled from our own studio waste. It would be cheaper and easier to throw our elastic offcuts away, but it sure wouldn't feel right.

LESSON LEARNED #4: I… may have been too nice.

Truth time: the Amazon products aren't our only copycats. A well-known equestrian brand who we were excited to collaborate with borrowed an Intrepid belt at a trade show. Then, they launched a lookalike with their logo stamped on where Unbelts' had been. What the.

I had a direct-but-respectful conversation about it with their CEO at the last trade show we both attended. Later, she offered me a 3% royalty on their continued sales. I declined. And then my email address got blocked. Their dupe is still available on their website.

My optimism is my best and worst trait. I’d truly thought we’d come to an agreement as  two reasonable people who could identify a mistake and just… fix it. I still believe in the benefit of the doubt.  But I also believe in my own work and livelihood, and when you sell my designs as your own, you’re earning dollars that were meant to pay for my groceries, not yours. Don’t be icky. Make your own stuff.

• Takeaway: When someone shows you who they are, believe them. And consider sending a Cease & Desist.

Okay - that's it.

And on the bright side, my friends, we’ve got a plan. After a robust look back at what got us here to Dupeville, I’m very much looking forward to showing you what’s ahead, because it’s really, really fun. Make sure to sign up for our emails (see page footer) to get first alerts; I'll be back with our next post in a few days. 

- Claire