Kickstarter Backer Shipping

What we’ve been doing lately as a side-project is to provide Kickstarter Backer Shipping.  We’ve helped a number of project creators get their products across the border and into the hands of their backers, with currently having completed 3 projects.  We’re scheduled to do at least 1 more in the next year, all in the board gaming industry.

However, we thought it might be worthwhile to open this up to anyone who needs to bring a product across the border and ship their final items to backers.

Fulfillment to backers in Canada (prices in Canadian Dollars)


Service Fee Description
Import $5.00 Customs Fee + $3.50/parcel If stock is sent to our US receiving address, we can import it into Canada along with our weekly restock shipments for a small fee. If we are charged sales tax/duty on the items being imported, you will be assessed this amount as well.
Receiving $20.00/hour Unpacking of a game shipment, and inspection of received product for damage or defects. Average processing time is roughly 100 items/hour. This fee can be waived if you do not want us to inspect your shipment for accuracy/damages.
Order Handling $3.00/shipment + $0.50 per item over 1st item Packing of individual orders for shipping to backers. Includes boxes and packing material, and cost of re-shipping lost or damaged orders.
Shipping Varies Sending each parcel Canada Post Expedited Parcel service. See table below for pricing estimates.
Storage $1.75/ square foot If you need us to store additional copies of stock, or if stock needs to be kept at our warehouse for more than 2 business days prior to shipment, storage fees will apply. Most shipments are sent out immediately after being received.

Estimated Minimum Shipping Cost (Canada)


All costs listed are estimates only. We will provide you with a precise quote based on the dimensions and weight of your item. Please note that availability of specialized services, such as Lettermail, is subject to change.


<0.2kg 0.5kg 1.0kg 1.5kg 2.0kg 3.0kg 5.0kg
Cost/Parcel $3.50* $9.00 $11.00 $12.00 $12.50 $14.50 $17.00


*This price applies to Lettermail service only, which is available for items no larger than 8”x10”x0.5”. Please note that this service is not trackable.

Developing different forms of income

It’s interesting, with our business model, we’re beginning to generate different kinds of income.  We’ve begun to take service income for logistics / kickstarter fulfilment, 3rd party sales income from selling on eBay & Amazon, income from in-person sales at conventions and at our open hours, consulting income and even passive income from our Youtube videos.  Of course, our main income source is e-Commerce still and it’ll probably continue to be our main form, but it’s certainly interesting playing around with different forms of income.

The other aspect of these different forms of income is that it helps smooth out instability in other areas.  We get advertising income from our Youtube videos and that should, over the next fewyears, continue to generate a decent amount of funds.  It’ll never be a large amount of money since we develop our videos for a niche audience in our niche business, but it’s a nice addition and often seems to be quite stable.

Perhaps the area that we’d love to exploit and develop further is service income, from our Kickstarter Fulfilment to consulting.  It’s something we’ll have to slowly develop, between working on our other businesses.

Scam Company

Just got a call from a scam company called ‘Convention Housing Authority’. Phone number of tel:+12124413140.  They were mis-representing themselves as part of the Convention we were booked for and saying ‘It was their job to make sure we had accomadations’.

If they call you after you book a hotel, don’t. Always check with your actual convention exhibitor and/or contact the hotels listed on the convention website direct yourself.


Competing on Price

One of the rather more challenging aspects of the game trade which we are in is the fact that online, most people compete on price.  Due to the lack of barriers to entry, a lot of people recently have been getting not the business.  That unfortunately means we are now facing increased competition, most of which are competing on price.

What that means is that we have seen is a significant decrease in revenue as price sensistive customers move to our competitors.  However, changing our business model further – decreasing our sales even further – would be a bad move.  It’s a matter of margins.  A 15% decrease in our margins to compete would require a 30% increase in our revenue.  That’s a significant number, one that we find hard to meet.

So, what can we do about it? Well, if our current customers do not work then the better option would be find new customers, ones that are not as price sensitive.

Free, flat or variable shiping costs

Let’s talk about shipping.  Now, we all know that you need to let customers or potential customers know what the cost of shipping is before they hit checkout.  So you put in the necessary shipping estimators on the shopping cart and otherwise.

However, what kind of shipping methods do you use? The various options have pros and cons.

Free shipping (pure) generally means you put the cost of the shipping items in the cost of your products. This works quite well if, for example; you have a high margin product with a low shipping cost.  It also does well if you can get customers to purchase more than 1 of the item at the time, to save on shipping costs.

However, the cons are that you generally have to put a much higher price on your product which could make you seem uncompetitive.  I’d say this type of shipping method works best for really high value products (where shipping is a small portion of your actual price) or low value products  (where you can ship the order really cheaply).

Secondly, you can do a combined free / variable shipping method. Basically, you provide free shipping at a certain level.  Now, this shipping option pushes people to purchase a certain amount and if set right, can push people to the next ‘level’ of purchasing.  This kind of method requires more calculation but in many cases can be quite profitable.

Flat rate shipping on the other hand is perhaps the easiest for customers to understand.  It’s a simple number that they can work with, but has the disadvantage of requiring to you know your shipping cost quite well.  It also means that if a customer does a large order, and a lot of customers do that, you cost is going to go much higher than you expected.  Depending on how you price it, you might also be losing money on each order.

Lastly, you have variable – or actual – cost of shipping.  Here you charge everybody the actual cost of what it costs to customer to ship. This is of course the most fair method, but the customers that you really want – the large order customers might decide to go elsewhere because other businesses are offering them free shipping.

Building a Magento site for Canada

Let’s talk about Magento and building a Magento site in Canada.  For the most part, the things that you require are going to be the same at the basic level – theme, gateways, etc.  However, there are a few things that are very specific that is needed for a Canadian store.


You are going to need a Canada Post shipping module. Sure, you could ship via FedEx or UPS, but Canada Post is by far the cheapest system in Canada itself.  Purolator comes as a close second, but it’s still pretty expensive.  If you are shipping B2B though, I’d definitely look at either Purolator or one of the other companies rather than Canada Post as their combined shipping options (i.e. multiple parcels to same location) can drive costs down.


You are going to need to figure out your accounting.  Now, if you are purchasing only in Canada, you don’t really need anything major or different – however, if you are importing products from the States or elsewhere, you will need to tie-in purchasing and logistics with your sales.  Quickbooks works well for this, but understand you’ll need a software to import the stock/etc in – it doesn’t connect directly very well.  Webtex is one option – but again, once you hit a certain volume of products, you’ll definitely want a better solution.

That’s where things get tricky- very few systems out there tie-in accounting with Magento very well.  Look for a dedicated system that deals with Magento and multiple currencies.

Domain names .ca

You will want a .ca domain name.  Purchasing one is pretty cheap per year – about $10 per year.  In the beginning, you might want to just redirect the .ca to your .com; but not having it is a bad idea.

Google Webmaster

Okay, here’s an interesting thing to do – make sure to connect Google Webmaster Tools to your site and then target your site to Canada.  It’s an immediate boost for your listings in Canada but

Currency / Canadaisms

Don’t forget to mention what currency you are selling everything in.  Not only is this necessary for your payment gateway, you’ll also want to keep your precious Canadian consumers on-board for longer.  Definitely consider flying the Canadian flag somewhere prominent – it’ll keep your target market on your site longer.

French / English

Have only a few products? Seriously consider putting up a French translation of your site.  It’s a great way to get customers from Quebec and help you rank higher for a certain demographic.  Of course, the problem is if you have a lot of different products, you might want to avoid this due to the huge costs of implementation.

Analytics – Details Matter

Recently did an analysis of one our businesses – Starlit Citadel – and noticed that conversion rates had taken a drastic turn down.  It went from 1.56% to 1.15%.  That’s a horrid, horrid drop and even though we had a lot of competition show up recently, it seemed like a truly significant drop.

Now there’s a few things we could do.  Drop our prices and kill our margins, which if it had allowed our conversion rates to stay the same would have resulted in overall higher sales and a marginal improvement in profits (before taking into account additional staffing costs, etc.).

On the other hand, perhaps we should look more closely first.  So, here’s what we looked at to figure out the change:

  • Compared it to previous year stats – nope, still a drop for sure
  • Compared it against traffic sources – all over drop pretty much. Not good…
  • Compared it across new and old visitors – hmmm… new visitors were the one who killed it most
  • Compared it based on location – ah, this is more interesting.  Traffic had gone up significantly in countries outside of Canada.  This pushed down our conversion rates because people who aren’t Canadian just aren’t that interested in us.

As we said, details matter.  If we had decided to take steps to decrease our prices and increase our conversion rate, it would have helped but only a bit.  Instead, we’d have suffered more of a loss because the traffic from outside of Canada just don’t care about us. A price drop just wouldn’t help.

So, details matter.  Dig, dig, dig to understand what happened and is happening.

Bitcoins for E-Commerce in Canada

Ever wondered if you should integrate Bitcoins onto your site? Well, while Starlit Citadel isn’t the largest site around, we do have a significant presence.  Here’s a quick pie chart comparing the number of orders we received using Bitcoin as a payment method compared to our other payment methods.

Pie chart of bitcoin sales vs other payment methods

Bitcoin sales for half of 2014 compared to other payment methods

This pie chart consists of our sales from Q1 to Q2 2014 on Starlit Citadel.    We have Bitcoins on Fortress Geek too, but since SC is much larger, we figured it would be a better chart.  There’s not a significant difference between the two.

I don’t have to say much – Bitcoin’s a nice idea, but right now; at least in Canada, the uptake has not reached a point where it’s a significant payment method.  It might be different in the US where the population numbers are much higher as usual, but in Canada it’s probably not worth the time (unless you have nothing better to do).

Revenue Streams Online (2) – Affiliate Marketing

Affiliate marketing; boiled down to its essence is the process of trading eyeballs for sales on other people’s sites.  It’s not always sales – sometimes you get paid for an action (signing up to a newsletter, visiting a certain page, etc.) but it’s mostly about sales.   It’s also one of the more popular revenue streams available, so let’s do the Pros and Cons.


  • Low cost of entry. All you need is a website to start.  Once you generate the traffic, you can get the links for the various affiliate sites to develop your sales.
  • No inventory or customer service hassles
  • Can be an extremely passive form of income – once the website is up, the processing of sales/etc is left up to the affiliated company, not yours
  • Easy to enter / work with  multiple websites with multiple industries, allowing you to experiment with profitability
  • Can be mixed with other revenue streams like advertising very easily


  • Extremely competitive marketplace partly due to the low cost of entry
  • Can take a long time to develop sufficient traffic to generate decent revenue.  As you are sending traffic away, you get approximately 50% of all visitors at best to the affiliated site.  Those then convert at between 1-3%; so traffic must be significant.
  • You are dependent on 3rd party sites, for both payments as well as the processing of the orders and overall conversion rates / usability of other sites
  • As majority traffic is often generated directly from search engines / referrals (especially for smaller sized sites); you are most liable to Google algorithm changes


E-Commerce Ain’t Rocket Science

As much as people might wish it to be.  At least with rocket science there’s a lot more science than art to it, a lot less guesswork and a lot more fixed variables.  It might be incredibly difficult but the vast majority of the factors are known.

E-Commerce Isn’t Brick & Mortar Retail

We don’t deal with walk-in customers.  We don’t have to worry about displays or shelving or the appropriate amount of space between racks.  We don’t worry about the butt brush effect or seeming too crowded for customers.

If you are coming for retail, you have a great handle on logistics and inventory and what to order and when.  You have no idea about site design, usability, conversion rates and marketing.

E-Commerce Isn’t a Service Business

I have a friend. He runs a service business doing IT consulting.  He charges hundreds of dollars an hour consulting on IT.   His problems are very different from ours.  He never has to deal with inventory, but time management is important.  He can only ever sell a fixed amount of time unless he hires more staff.  He doesn’t have to worry about uploading products or designing new sites or generating a thousand customers a  month- just 2.   If you run a service business, your experiences are important but they aren’t part of the equation here.

E-Commerce Isn’t Affiliate Marketing

Affiliates create sites, they generate content, they sell space on their sites and eyeballs and clicks.  They are the front-face and the beginning advertising platform.  Developing a strong affiliate business is very different from developing a strong e-commerce business.  You could potentially develop a strong passive income from affiliate marketing.  E-commerce is all about fulfilling that order – because whether you drop-ship or hold inventory yourself, you got to have stock to sell it which means you have to active in managing stock.

Affiliate marketing isn’t e-commerce.  The skills might help, but it isn’t everything.

So What is It?

It’s not rocket science.  It’s not unique skills.  It’s a series of skills that are required, that you need to put together to make the business work.  You can gain those skills from a variety of areas, but learning to put them together requires time and money and if you’re lucky, assistance.