How I Started A $1.4M/Year Online Smoke Shop

Matthieu Fortin

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Published: October 27th, 2022

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Matthieu Fortin

Founder, Upper Limits

$120K

revenue/mo

Founders

Employees

Upper Limits

upperlimitsinc.com

from Springfield, IL, USA

started July 2013

$120,000

revenue/mo

Founders

Employees

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Hello! Who are you and what business did you start?

Hello, My name is Matthieu Fortin and I am the CEO of Upper Limits. Upper Limits is a hybrid brick-and-mortar/e-commerce company located in Springfield, IL. Upper Limits is a retailer and b2b wholesaler for dispensary, smoke shop products, and custom glass pipes.

We have a glassblowing facility on site where our customers can see our glass artists working every day. Our team also produces high-quality, bulk-promotion glass hand pipes where we custom etch company logos right into the glass. This has been a widely popular and growing area for us.

We make custom promo glass products for companies, retailers, brands, and dispensaries all over the US. The perfect promotional item for a cannabis brand. A product their customers will use multiple times a day with their brand right on it.

A lot has happened in the 10-year time frame. From the governmental regulation of e-cigs to the very slow adaptation and acceptance of the cannabis industry, it has been a long, bumpy road with a lot of lane changes and revenue stream diversifications, which continue today.

We faced challenges head-on and have learned a tremendous amount both in our industry, and organic business growth. The reward for this unbridled passion is apparent through our swaths of satisfied customers resulting in a business that generates 366% greater sales revenue than our industry peers.

What's your backstory and how did you come up with the idea?

I started the company in 2013 with the idea of having a place where medical cannabis patients could come to find education and guidance on navigating the world of cannabis cultivation, production, and extraction.

I remember some of the very first days after working hard to open the doors. I used to stand behind the counter hoping someone would come in that day.

I am passionate about the health benefits of vaporization vs. combustion, the importance of proper use, and access to a vast knowledge base for patients suffering from complex medical conditions. I knew this would require a compassionate and well-trained staff.

Back in 2013, vaping was just starting to gain traction as a smarter alternative to smoking and there were not many places offering new product technology education as it came to market. That was one of the big problems we set out to solve. I was a smoker for 15 years.

Within a week of using an e-cig, I was completely off cigarettes for good. I tried many times in the past to quit smoking without success. How can this new technology work so well, yet most people still don't know about these new products? I thought to myself. Having recently lost my grandfather to lung cancer, and seeing the success e-cigs had on my close circle of family and friends to help them quit smoking, people needed to know about this amazing new technology.

Approximately 500,000 Americans die every year from tobacco-related illnesses. I believe this new technology could be the largest opportunity for the country's public health of a lifetime. I still passionately believe this and the more scientific research that continues to be released still backs this up. I hope the studies continue.

I was sharing a meal with a childhood friend when we began discussing the need for a retail shop highlighting local artists and their products. “Upper Limits” came up through our organic brainstorming and we both agreed that it felt right. I think at the time I was in college and working a full-time job. I was not planning to have an active role in the new company. I provided some monetary investment and helped acquire commercial space.

Due to unforeseen circumstances, my business partner had to release his role in the venture. These new developments left me with a choice: to break the newly signed lease and give up the investment, or to push forward and try and get the business up and going on my own.

I’ve always been the type to run toward a challenge, so I decided to go all in and give it a shot. I quit my full-time job and dedicated myself to the new business. Immediately I realized I needed products from an emerging market and began researching holes in local retail offerings. I took my life savings and purchased some higher-end smoke shop and glass products to fill our shelves.

This was both one of the scariest and most exciting points in my life. I remember some of the very first days after working hard to get the doors open. I used to stand behind the counter hoping someone would come in that day. I would watch the endless line of cars at the nearby taco restaurant drive-thru, wondering if I did it all wrong. There were more than a few “customer-less” days. I thought to myself on several occasions, “What am I doing with my life?”

Starting a business can feel like a gamble but if you commit to your cause, do your market research and learn how to stand out in your industry, things can move in a positive direction. Organic business growth is a slow and steady process.

Take us through the process of designing, prototyping, and manufacturing your first product.

As funny as this sounds, I kind of stumbled my way through a good portion of this process. There was no set recipe I followed for any of it, especially with the strange and constantly changing landscape of the cannabis (and vape) industry. I believe that a significant portion of our success can be attributed to having extremely talented people at the top of our organization. I am very proud of the leadership team at Upper Limits.

That being said, you can't go wrong focusing on the customer, ever. Customer satisfaction doesn’t end when money is exchanged. It continues for the life of the product we sell and that is something that we feel strongly about. Our team has always had a talent for seizing opportunities when they present themselves.

An example of this would be when customers are looking for things that aren't available in our market and being first to have those on our shelves. If the idea is generating excitement among our customer base, we see that as an opportunity to be trendsetters in our field.

This is one of the perks of having a retail location. We get real-time responses and interactions in our local market to gauge whether or not to scale the product or idea.

Upper Limits created a few brands of our own as well. We sourced high-quality manufacturers for the parts (again a lot of trial and error), and we worked closely with engineers, dissecting every design endlessly until we had it right. Never be afraid to go back to the drawing board.

Describe the process of launching the business.

After location, one of the big challenges of starting a retail business is which brands and products to start with, directly followed by how to pay for this new inventory. In the beginning, I bootstrapped the new company. I gathered the little I had in a savings account, and my checking account, and sold off anything of value I had at that time.

I scraped up $30K to finance the new business endeavor. With the initial funding secured, I spent a lot of time researching products on industry forums. I would note which products and brands people were raving about, then talk to the company to feel out if they were a good brand fit. I hawked second-hand display cases from marketplaces and classified ads along with any other furniture needed at that time.

I found one of the best ways to get new and unique products were through industry trade shows. This allowed me to be face-to-face with brands and learn more about the products. Building relationships with our vendors, and having those conversations would benefit pricing negotiations. If you make a good impression, account reps seem more willing to go the extra mile.

I also developed a great relationship with our customers and listened to their feedback and product suggestions. The customers will usually give you tremendously helpful feedback if you listen.

I would also watch the analytics of the products we carried, paying attention to which categories were showing growth potential and letting go of the ones that did not in the expected timeframe. Meanwhile, developing a solid knowledge of the products that were showing potential.

Create an atmosphere of acceptance within your team. If you build a team that is afraid of making mistakes, you will have a team who is afraid to succeed.

These were the days of living off ramen noodles while you wait to recoup your current inventory investment to purchase more. A lot of trial and error, letting the numbers speak louder than my personal opinions. I noticed a large increase in our business in about 6 months.

Things took off once I established a more solid business credit history and was able to get lines of credit for larger inventory purchases.

Since launch, what has worked to attract and retain customers?

It’s no secret that word of mouth is number one. People are usually very quick to share bad experiences so I always want to do right by our customers. I believe Google is very important to any business looking to acquire new customers. Google has fantastic free tools for businesses like Google Analytics, Google Search Console, Google Business Manager, and Google Tag Manager.

Tools like Google Analytics do lots of things but the main importance to me is the metrics it provides. This data will show you the areas you are succeeding in, while also showing you the areas that still need work. Looking at Google Analytics as I type this, one well-performing metric that stands out is user acquisition.

Compared to last year, our new user acquisition is up 92% this year to date. The reporting features of GA are very extensive and it gives you the overall master view of how your business performs online.

Email marketing is another important area that has helped to grow our business. This has been a more recent area of focus for us. We are still learning solid techniques that work best for us as we continue growing our email and SMS marketing.

We are currently using Klaviyo’s marketing platform. Klaviyo’s Magento integration is somewhat lacking compared to other platforms like Mailchimp. However, the features and endless automation are truly amazing. Their customer support is also top-tier. I love Klaviyo, so I keep bugging them to show Magento some love so we can stay with them. There are many platforms out there so it is important to choose one that has the features you need and integrates well with your system.

I believe that email campaigns are still a great way to keep in touch with your customers. Campaigns can keep them updated with product promotions, sales, news, product updates, and educational content. I always believe providing value to the customer in our email campaigns is very important along with a catchy subject line, or hook when writing. Whether that value is in a special coupon or creating value through good information in blog articles. We have grown our mailing list organically with about a 1953% increase in subscribers year over year.

We are currently working on ways to engage our customers to leave more user-generated content and product reviews. My favorite benefit we offer is our customer rewards program. It feels good as a business owner to give back to our customers by providing them rewards when they support our business. We started offering this early on in our business before a lot of big chains were doing similar things as you see now.

The customer response was huge, and it felt really good to show support directly to the individual customer in an impactful way. I also think it is important to highlight and participate in the industry conversation as much as possible. We recently started our web blog and have seen a whopping 36,900% increase in first-time new users hitting the blog landing page this year.

Our blog has been a great addition to the website along with the SEO benefits it brings in organic traffic. Blogs can also help with internal links and backlinks to your site. Blog content can also be a great way to provide comprehensive answers to the questions your customers may search for.

Our team collectively pitches new ideas on content. We are currently in the process of trying to bring in more writer collaboration from freelance writers who are familiar with the industry. I look forward to growing our blog and making it even more informative.

How are you doing today and what does the future look like?

We have weathered quite a few storms this year and the season doesn’t seem quite over yet. We took a hit when the government regulated most e-cig products off retail shelves.

However, we have been diversifying our retail and wholesale offerings for a while now so we were able to pull through. There seems to be a current rough patch other retailers are experiencing with the economy as well. I do expect our revenue to grow in 2023 along with our cannabis accessory offerings.

As more states legalize cannabis, there will be exponential growth opportunities in both retail and wholesale for the products and services that we offer.

There are also emerging industry opportunities that we have an interest in. We also plan to stay the course of growing our e-commerce platform and continue to find new ways to engage customers to increase user content.

Through starting the business, have you learned anything particularly helpful or advantageous?

Lessons from owning a business can come from all sorts of unexpected places. A somewhat recent lesson I’ve learned is that owning a business can suck the life right out of you if you let it. You have to establish solid boundaries and enforce a strict work-personal life balance. Make sure you spend time on yourself, time to enjoy your family, and just enjoy the gift of existing. A long nature hike through a forest every so often is priceless and this will recharge and renew your drive.

Nothing is more important than your mental and physical health. Your business, team, and family all depend on you. There is never enough time in the day to get everything on your list done. Accept it, prioritize your tasks and set aside the time to exercise and be healthy. Get enough rest every night. The suggestions above will truly make you a much better, more productive leader.

Of course, these things are easy to say but it takes time and mental fortitude to develop and put them into action. It is easy to push your own needs to the back of the line when you have so many responsibilities as a business owner. When all is said and done, you have to realize that you’re doing all of this work to give a better life to your family, but your family needs to have you there to enjoy the life they have today.

What platform/tools do you use for your business?

We have cycled through many different platforms and software tools trying to find the best fit for our shop. We currently use Magento 2, Magestore, Slack, ShipStation, Trello, Notion, Google Workspace, Ahrefs, Klaviyo, Adobe Creative Cloud, and AWS.

I am a tech lover so I am always playing around and testing new software, sometimes it drives my team crazy. Our business runs on Magento 2. Magento is not the easiest road for a small business to travel down. It has been a bumpy ride when we have to constantly take on all the development and the updates, but the rewards of being able to do anything we want with our platform, to me, make it worth all the work we have put into it.

Having the freedom to choose our merchant processor. We also run our POS systems from Magento which is quite different from our peers. Our POS system is designed by the team at Magestore.

What have been the most influential books, podcasts, or other resources?

A few good podcasts I have been listening to are: Masters of Scale, My First Million, and a new one I started listening to “Limited Supply”.

A couple of books I recommend are Trillion Dollar Coach by Eric Schmidt, Jonathan Rosenberg, and Alan Eagle. I also like Company of One by Paul Jarvis.

My next plan is to venture toward media that promotes mental health and a positive mindset to maintain stability in an ever-turbulent environment.

Advice for other entrepreneurs who want to get started or are just starting out?

The best advice that comes to mind: is to use failure as an opportunity to learn. You will fail at some things and that is perfectly okay. It is how we learn and grow and it’s important to understand that. Everyone experiences failure multiple times, embrace it. Do not be afraid of failing and let that keep you from trying new things.

Some of the greatest entrepreneurial minds of our time have failed many times before finding success. To add to that message, you have to create an atmosphere of acceptance within your team. If you build a team that is afraid of making mistakes, you will have a team who is afraid to succeed. Reward curiosity. Each team member has valuable knowledge and life experience that can shape the future of your business.

Another important piece of advice is to not depend on someone else to learn things for you. Whether that be a consulting team or agency, learn the basic workings of that area or part of your business first before bringing on a person or team. You will greatly increase productivity, and direction, saving you big future headaches. There are no excuses for not understanding how certain things work in today's world of Youtube University and Google. Make the time to learn, it pays dividends.

Finally, treat your employees well. Create a good working environment and give them the tools and knowledge they need to grow successfully both personally, and professionally. Be a good leader, one that encourages healthy company culture. Lead by example as they say. Remember negativity is contagious and toxic. If you need to micromanage employees, you might need to re-access hiring practices.

Are you looking to hire for certain positions right now?

We are currently looking for a full-time glassblower to manage our new glass production facility. You can learn more about the position HERE. We also plan to have a new marketing position opening up in the spring of 2023.

Where can we go to learn more?

If you have any questions or comments, drop a comment below!