Free coffee

I read an article today (by way of the Freakonomics blog) about a coffee shop that doesn't put prices on any of their food or drinks — payment is strictly voluntary.

I can usually form a firm opinion about a business model within a few minutes (and there are a lot of times when I'm wrong), but I just can't make up my mind about this one. I think this could either be a doomed experiment from someone who has money to burn, or a genius idea (no in between).

Here's why I think it's genius:

  • The shop gets a ton of publicity, especially compared to the amount of publicity that any old locally owned coffee shop opening up across the street would get (zero).
  • They will attract a lot of new visitors who want to use the experience as a psychology experiment: "would I feel too guilty if I stiffed the shop on payment?" This woman felt so guilt for not paying, she drove back and paid double what she would have.
  • Their overhead involved in coffee sales is very low, and there's a lot of potential for high ticket, high margin ways to make money of customers sitting around in your store drinking inexpensive coffee.

Here's how it could fail:

  • When the publicity and novelty wears off, only the customers who are attracted by the possibility of low/free prices would remain. The customers who would gladly pay $5 for a cup of coffee would do so because of the quality of the product or the setting, which might not necessarily be at Terra Bite Lounge.
  • Owning a coffee shop sounds a lot more glamorous than it really is. Even if the experiment is initially successful, the owners are still left with a coffee shop to run.
  • They're battling Starbucks, who has 11 stores in Kirkland, WA (population 45,000). Starbucks is already winning their battles against local coffee shops, and they're doing so in spite of having higher prices.

Of course, if the owners do have the money to burn, then there's no fault in running the experiment. And they're pledging to donate profits to charities, so that would be a win-win if successful.

What do you think? Doomed experiment or genius business model?

The biggest game of his life

I couldn't help but feel bad for Peyton Manning today when I saw the front page of today's Indianapolis Star. What kind of pressure does he feel when he sees the "The Biggest Game of His Life" fill the front of his hometown's Sunday paper?

Contrast that to the front page from the Lowell Massachusetts Sun exclaiming, "In Brady We Trust."

When I've found myself at critical intersections it hasn't done me any good to focus on the "make or break" nature of my goal. On the other hand, it makes a lot of difference if I know there are people in my life that trust me to see it through.

It's a good thing Peyton didn't let the pressure get to him today. :)

50 things I learned in 2006

I found a post by way of Doug, challenging bloggers to write about 50 things they learned in 2006. It sounded like fun, so I decided to give it a try:

  1. Speaking objectively, my son is the cutest baby in the world.
  2. Anything left on the floor will be licked or eaten.
  3. He will not be content to just sit on my lap and watch me type.
  4. Being a dad is a lot more fulfilling than I had imagined.
  5. Moose and Zee are funny.
  6. Starting a business is a lot easier than it seems — the most challenging parts are psychological.
  7. Having a supportive wife is one of my greatest assets.
  8. I'll spend a lot of time on things that I didn't anticipate.
  9. I won't spend my time on the important things unless I force myself.
  10. It's not easy to figure out what the important things are.
  11. I can make a decent living on my own.
  12. Doing what I love is reward enough.
  13. What used to look comfortable can look risky after taking the leap.
  14. Diggs are fun, but they don't bring the people who are ready to buy.
  15. Most people have never used Digg, del.icio.us or Flickr.
  16. YouTube can be addictive.
  17. JavaScript programming can actually be fun. Especially with Prototype.
  18. YUI is an incredible JavaScript toolkit.
  19. Customers don't care that what I'm using is called Ajax.
  20. It doesn't get easier to deal with the vulnerability that comes with publishing a blog post or releasing software for the public.
  21. It's important for me to write regularly.
  22. It's important for me to consistently read books.
  23. Sometimes I can be more productive in the long run if I just walk away from the keyboard and watch an episode of The Office.
  24. Efficiency starts with a 3200x1200 pixel display resolution.
  25. Working barefoot increases brain power.
  26. Patience is key to success, despite what hype I hear otherwise.
  27. Daniel Negreanu is one of the best poker players in the world.
  28. Deep stack tournament poker is way more fun than any structure I've ever played.
  29. 10 days is too long to vacation in Las Vegas.
  30. I will always want to return to Las Vegas.
  31. 2-7 Triple Draw is fun.
  32. Our elected representatives just don't understand.
  33. RSS feeds are an essential tool for professional development.
  34. I shouldn't take on projects just because times are slow.
  35. I shouldn't turn away projects just because times are busy.
  36. In a lot more cases than I'd thought, it's better to spend a lot of money than a lot of time.
  37. Custom software can save me a lot of time and money.
  38. Fry's really isn't all that much better than Best Buy.
  39. Providing great customer service is worth it, no matter how hard it is.
  40. Great help desk software makes a lot of difference.
  41. Marketing is a lot harder than it seems.
  42. It's almost impossible to find great contractors.
  43. There are a lot of customers who have been looking for a long time.
  44. A lot of things are tax deductible.
  45. It stings a little less if I don't wait until April 15th.
  46. ING is the best place to have a savings account.
  47. I can't compete against Brock when it comes to LinkedIn.
  48. Maintaining a good network is important.
  49. A lot can be learned from a great small business forum.
  50. Blogging can be a rewarding experience.

Web application for calculating travel mileage

Last week I started trying to tally all my business-related travel mileage for the year, and was struggling to do it in a non-tedious fashion. The key problem was that I haven't really kept good track. It's quite rare that I think about it when I get in my car, and even more rare that I remember to write down an odometer reading when I return. Although when I say "rare" I really mean "never".

However, I do keep good track of my meetings and travel in Google Calendar, and started delving into the API to try to figure out a way to automate the process of extracting scores of entries into a spreadsheet and cross-referencing mileage results from Google Maps.

After a few hours of hacking I had something pretty decent, and decided to continue working on it so that others could easily use it if needed. So here it is: a web application for calculating travel mileage. You can use it to calculate mileage for any number of start/destination addresses and download the results to a spreadsheet. If you use Google Calendar, you can pull events from a specific date range and calculate mileage using the locations you entered for an event.

Let me know what you think — questions, suggestions, etc.

Many thanks to Doug Karr for putting together the design and being a beta tester.

Computer repair and customer service

I ran across the clip below the other day and found it pretty interesting. A TV station started with a perfectly working computer and disconnected a basic cable so that the computer wouldn't boot. They then took the computer into a number of computer repair shops to see if the problem would be diagnosed correctly, and how much each shop would charge.

I was surprised to see how many shops either misdiagnosed the problem or were dishonest regarding the repairs. Unfortunately, since all that's out there of the story is that short clip (the story doesn't appear to be on the TV station's website), we don't know everyone else's side of the story. For instance, did the reporter drop one of the computers and it really did have a bad motherboard?

I was mostly surprised to see that the biggest offender was someone from a small independent shop. How long is he going to be in business if he makes a habit of gouging his customers? His relationship with customers is pretty much the only competitive advantage he has against the larger computer stores even though there's no shortage of people who hate Best Buy.

It was good to see that at least one shop didn't charge anything for plugging in the cable. They obviously get it right. If I was on the customer end of that transaction, that probably would've won me as a customer for life.