Tim Riegel, a business owner in Lamar, Missouri, had a eureka moment when reviewing his monthly earnings half a year ago. Despite strong sales from his side hustle, Mozark Fire Pit Studio, the profits seemed to be dwindling.
The culprit was that the company got bit by the inflation bug.
From its launch in 2021, Mozark Fire Pit Studio’s momentum was initially unstoppable, he told CNBC. Beginning with crafting heavy steel fire pits for his local community, Riegel expanded to shipping the products via Etsy Inc ETSY, in both the U.S. and Canada.
Within five months, his company brought in $50,000 in sales.
But then came the sting of inflation, silently eroding profit margins. Although his sales volume hadn’t diminished, costs related to recyclable steel, gas, and packaging were climbing.
The 60-year-old entrepreneur had to raise prices, but offered more value with customizations and color options for his products. His strategy was to increase prices incrementally and avoid any sudden spikes that might deter customers.
The price of his fire pits ended up escalating to $950 from $650 within one year, generating sales of $169,000 over the past year.
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Riegel shed light on his strategies amid economic challenges, saying he constantly monitors and reassesses expenses, cautioning fellow entrepreneurs about the pitfalls of not remaining vigilant, “You have to really watch the costs,” he told CNBC.
For him, competitive pricing without compromising on profit margins is pivotal. He studies market pricing to ensure his products remain competitive. And with surging sales, he’s found a way to economize freight costs, a tailwind to his business.
Another feather in Riegel’s cap is his commitment to customer satisfaction, CNBC said. He spends hours texting his clientele, sharing product images pre-shipping, and ensures they’re pleased post-purchase.
Balancing his side hustle, which demands an additional 40 hours a week, with his full-time job might seem daunting to many. But Riegel seems to have seamlessly integrated his business into his personal life. “I schedule my pits, I also schedule date nights with my wife,” he said.
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