Wednesday, February 9, 2011


I'm packing up and getting ready to leave Texas City. My plan is to make my way to Moab in southeastern Utah. I'm meeting the NavUnit, the SecurityChief, and Julius there. They're going to be driving down from Corvallis for a few days. I don't know the exact details of what we'll be doing but I'm sure some mountain biking and rock climbing will be involved. I'm looking forward to our outing. Moab was one of the areas I visited during my original leave of absence and it's high on my list of places to revisit.

It's been a mix of different types of work since my last entry. In early November I decided to take on a contract job to develop an iPad application for a customer of my mobile device application. I finished that job in January. It was a good experience. I learned some new techniques which will be very useful as I further develop my main software product. The client was happy with the end result. He turned out to be a good graphic designer, and when combined with my technical skills it resulted in a nice looking application. The client was also willing to do the bulk of the testing (he was good at it too), which is the part of software development I least enjoy. Despite the positives I somewhat regretted taking on the work. Looking back, it was a distraction from the bakery and ongoing development of my main software product. It was nice to get a good sized check, but because it's for private use the work won't result in an ongoing revenue stream. I'm not sure if it was worth it. If nothing else I learned a few things from it.

We seem to be executing well on our objective of consistently generating a profit at the bakery. We've had four profitable months in a row now and we deployed an inventory management system in January. We had to terminate an employee in December. At HP there were people who's job it was to handle all the legal details which are entailed in terminating an employee. In a small business you get to do it all yourself. For the first time I was exposed to dealing with the Texas Workforce Commission. This is the state's labor management agency. It ended well for the bakery but reinforced the need for us to have robust human resource processes in place. I was glad I had some employee relations experience from my days as a manager. It definitely helped. We've since spent some effort reinforcing our HR processes. I came out of the experience with some admiration for Texas employment law. It's clearly designed to encourage employers to keep people employed, but within a certain set of well thought out constraints. I think the law strikes a good balance between the interests of the employer and the employee. Like many Texans I know, it has a no-nonsense quality to it. The main things to remember are to clearly and consistently communicate expectations, both when they're set and when they're not being met. And above all, write everything down. I ended up sending about 20 pages worth of documentation to the workforce commission in this case. When it come to legal matters, if it isn't written down it might as well not have happened. I imagine a lot of small business owners burn themselves by lack of documentation when it comes these sort of matters.

There's still a lot of things we could do in the bakery to improve efficiency. It's encouraging to see profitability despite all the known inefficiencies which still exist. I also feel good about creating some jobs for the locals. We recently gave one of our employees a raise and made her our first assistant manager. With Nina about to have a baby we knew that we were going to need some help managing operations. We're now using some of the profits to pay ourselves. The cell phones for Nina's family, my mom, and I and certain vehicle expenses (gas, oil changes) are now coming out of the bakery. Relatively speaking it's a modest amount but it's certainly nice to begin seeing some monetary reward for our efforts. We're reserving the bulk of the profits to fund future growth or in case we have rainy days in the future. The sales growth rate has slowed a bit but if the January 2011 sales are any indication we can still expect a strong growth rate this year. Most recently we found someone to help us develop automated cakeball manufacturing equipment. We built a proof of concept unit which produced great results. I'm waiting for the bill of materials so we can order the materials to build what we hope will be a production unit. Hopefully the profits and sales growth will keep coming.

On the software side I released another significant update in January to my main product. The revision added another expansion pack and addressed many stability and reliability issues. Previous versions had proven to be fairly robust, but I'm rather fond of things which never break. I also know that robustness is important to the small business market I'm targeting. The new rev looks to be rock solid. I haven't had a single bug report or problem email since it's release. I'm pretty happy with the results. I've kept raising the price of the software in an attempt to find the point of maximum revenue. The unit volume vs price curve so far has been flat. Unit volumes only go up as the price nears zero. In terms of dollar volume it doesn't look like I've found the maxima yet. The results have encouraged me to continue developing the app. I have three more expansion packs I want to add, one of which is nearing completion. I also want to develop a subscription based service around the app. I've started some early work on the subscription piece, but it's going to take time since it will involve developing a web application to accompany the app. I've become more comfortable with mobile software development but web development is another animal. I have some familiarity with it but I'm going to have learn some new things. That always takes time.

My brother in law, who's a maintenance technician in the petrochemical industry, had an idea for an app which he thinks would be very useful to many folks in that industry. Relative to the app I'm already selling (and the contract app I made) it sounded easy to build, so I took his idea on. The app's nearly ready to be submitted to the publisher. The nature of the app means that the size of the market will be limited. (That said, when you visit this part of the country you realize that the petrochemical industry is huge.) My brother in law says that what the app does is very valuable, so I think we'll be able to charge a fair bit for it. He's been in the industry for 20 years at 3 or 4 different plants and knows a lot of people. I'm hoping we can leverage his network for marketing purposes. The app was quick and easy to build, so worst case it's not much of a loss if it's a flop.

I've had other ideas for useful small business oriented mobile apps which don't seem to already exist but it's pretty limiting when one person is doing the bulk of the work. Playing HR and IT manager, accountant, delivery truck driver, and dishwasher at a bakery doesn't help with time either. I tried to talk one of my engineer cousins in Mexico into becoming a partner but she declined in the end. I think I need to get further along on executing my vision for the app I'm already selling before taking on any other substantial projects. If it keeps growing maybe I'll just hire someone to help with future projects.

I'm looking forward to my bi-annual migration trip. This business stuff has been entertaining. A big part of the fun is not knowing what's going to happen. Figuring out how to overcome obstacles is enjoyable too. There's also a social or organizational engineering piece which I like. There certainly have been some surprises, and I'm sure there will be more. Whether it's going well or not I suppose depends on whether you're getting what you want from it. From that perspective it is going well, but I know that I'm not using typical measuring sticks.

All of that said, at some point (I'm there) things become a bit too routine and I feel the need to leave it all behind for a while. Some aspect of having everything you need in a vehicle with only a vague notion of where you're going and what you'll be doing appeals to me. I accomplished what I wanted to accomplish down here. Time to leave.

The photo at the top is a cake we made for the city's centennial celebration. It barely fit through our door.

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