I want to help you build a sustainable, profitable handmade business that makes you consistent income and sales. I only ever teach or recommend marketing, social media, pricing, production and branding tips that I’ve personally used successfully in my own 7-figure handmade businesses.
I'm Mei, from Los Angeles!
starting a business
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I almost didn’t want to create this post, but I’m going to. I think it’s an important lesson that you need to hear.
I’m going to share with you something I’ve never shared before with anyone else, and that is my $2,000 mistake on Shopify.
Ugh. Okay, here goes.
This was back in 2015 so it wasn’t that long ago. My business was still pretty young in the sense that I did any and all web development work myself.
These days, if I want to make any changes to my site, I have a Shopify developer who I love working with to help me implement those changes. I just tell him what I want, and he goes and does it for me.
Back in the day, it was all just me setting up my site and configuring all the settings.
I was also still learning a lot about e-commerce. I’m sure you can relate! When you’re just getting started, sometimes certain payment terms or tax words are confusing.
I don’t even really remember how I found out what was happening. I think I was doing my finances and looking through my bookkeeping.
I like to look at my numbers at least once a month just to get a pulse for my business.
I remember feeling this weird unsettling feeling like something was wrong.
My shop was telling me I made x number of dollars the month before, but when I look in my bank account, I was not seeing all that money.
So I go poke around in my orders and I see that I did, in fact, make those sales and those orders had all already been taken care of.
We made the products, we shipped them to our customers, our customers got their packages. No problem there.
Then as I’m scrolling down looking at each order, I see something that freaks me out.
Every order in that month that was made by credit or debit card (not with Paypal) all that money that customers were supposed to pay me… didn’t actually get paid to me.
If you’re not following, I had basically shipped out about a hundred or so orders to customers who, at the end of the day, didn’t pay me a single dime.
The gravity of this was like a punch in the gut.
I remember my heart had that dropping feeling you get when you’re in an airplane with turbulence or if you go on roller coasters and it takes a dip.
But that feeling was like for a long time.
I was thinking, “I hope this isn’t real. I hope this isn’t happening. Maybe I’m mistaken and I’m just not understanding the situation carefully.”
First I was in denial, just hoping none of this was actually happening.
Then I was angry – at myself, at my website, at anyone who could possibly be at the root of this. I wanted to find someone to blame.
Then I went into bargaining mode where I was looking at other orders and, thankfully, found out that orders that went through Paypal didn’t have any problems. It was only orders that were paid by credit card.
So it wasn’t like my entire month’s sales went down the drain.
Then I started thinking, actually, it’s pretty bad, because not only did I not get paid for those sales, but I had to ultimately spend money out of my own pocket to pay for materials and shipping.
Not to mention the time it took to make those orders. All of that, out of pocket.
I lost a lot of money.
Then I started feeling pretty depressed when it started to sink in just how awful this whole situation was.
I mean, all of this happened in the span of not more than a few hours.
I remember telling my husband at the time and feeling like a failure.
How could I have messed up so bad?
Just thinking about the situation still gives me trauma.
It turns out, for whatever messed up reason, in my payment settings, I had manual capture turned on instead of automatically capture payments.
If you’re not familiar, what manual capture means is when a customer places an order on your site, they have to enter their credit card details like normal, but all it does is authorizes the payment.
The payment hasn’t been taken out of their credit card yet, even though the order was successful.
This never crossed my mind that this would even be a possibility.
Until this happened, I didn’t even know this way of taking payments existed.
At the time I was angry. Why is this even an option?
I thought this was a really stupid way to do things.
But now I’m thinking there’s probably some business model that can benefit from this payment method.
Maybe you make custom products and you don’t charge for the sale until right before you ship the product.
Or maybe you’re selling wholesale. What I’ve learned in my experience is that stores have this expectation of only wanting their card to be charged just right when you’re about to ship the order.
With manual capture, you have to manually process their payments within a certain time frame. It really depends on the credit card or the processor, but it’s generally about 7 days.
Obviously that window of time had passed and by the time I realized this was happening. It was too late.
If I had known before 7 days, I would have been able to save myself a lot of pain.
Well, that’s finally when I got to that acceptance stage of grief.
I thought, “Okay, so this happened, I can’t change it.”
But then I started to problem solve.
What could I do to get back at least some of that money I’d lost?
That same day, I started a spreadsheet and I put all the orders that were affected in this spreadsheet. I put the customer’s name, their email address, and how much they owed me.
It was definitely scary to see the amount of money start piling up.
I thought to myself, “Okay, I’m going to reach out to each person, one by one.”
I put myself in the customer’s shoes.
If they got a random email from me asking them to pay them money for an order they already got, and they probably think they actually paid for it might raise some alarm bells.
I’m sure a percentage of people wouldn’t even believe me and think I was trying to scam them and get them to pay again.
I actually filmed a video explaining the situation. I didn’t just write it out in an email.
I figured the best way to do this would be to replicate a phone call or an in-person exchange, as much as possible.
But I had so many customers to reach out, and at the time, I had too much anxiety.
I mean, just calling anyone on the phone would make me sweat bullets and my heart rate would go up and I’d start almost hyperventilating.
I’ve come a long way.
Suffice it to say, phone calls were out of the question.
I was also partly afraid that people would be mad at me or worse, think I was trying to scam them.
Not to mention, it’s really embarrassing.
So I decided to film a short and sweet video explaining what happened. I put the video on YouTube and made sure it was private so you can’t see it unless you have the link.
Then I took the link of the video and put it in my emails.
I had to make sure my customers actually opened the emails and read it.
I went into the email receipt that I got for each customer and replied to that email. That way, the customer would see all the details of the order in question. For the subject line, I wrote “Issue with payment for your order”.
I wanted the email to be professional and polite, yet assertive.
I didn’t want the customer to feel bad or that it was just totally my fault. You can see how for the customer they had to make an ethical, moral decision: if they would pay me or not.
I mean, why should they?
They’ve gotten their products, they got what they wanted. If they didn’t have to pay for it, that’s a win for them, right?
So in the email, I said:
Hi [NAME], thank you so much again for your order. There’s an issue regarding payment for your order below. Please see the two-minute video linked here with my quick explanation. Your payment was not processed so your card was never charged. You can check your statement for this. An invoice has been emailed to you for payment.
So that was how I was collecting payments. I went into Paypal to manually invoice every customer.
I went on to say that it was totally my fault. I’m sure the customer is wondering what happened. I apologized for the trouble and confusion and explained this was a tech issue on my end and it has been fixed so it won’t happen again.
I ended it with a thank you for their understanding, patience and support.
So it was a short, sweet, simple email. No whining or begging. Just really objective and straight to the point.
I send out all the emails that same day. And then I just waited.
Did I make that money back? Did anyone actually pay me?
I mean, this is like a real test for society and mankind, right? Will they do the right thing?
I’m generally a skeptical person and in my head, I was certain that no one was going to pay up.
But I’m here to tell you that people are in fact, good.
It worked. People were actually sending in payments!
Every time someone paid me, I would enter it into my spreadsheet.
I was able to recoup about 70% of those lost orders.
To this day, I’m still very pleasantly surprised that most people chose to do the right thing.
We hear so many awful things that people do in the news, and it’s stuff like this that makes me think, maybe we haven’t really hit rock bottom yet.
She had just launched her candle shop online and she actually did really well in her first few days. I was so proud of her!
Then I got this email from her and she told me she just had this same experience.
She had $1,500 worth of orders where the payments were released back to the customer. It’s just a really crappy situation.
I told her exactly what I did, and she went to work right away reaching out to her own customers.
She updated me a few days later and she was able to get back 30% of those lost orders.
I told her she needed to follow up with the rest anyway. People literally paid me two months after I sent them that email.
Sometimes it just takes time and legwork.
So moral of the story is to make sure, no matter what shop platform you’re on, that you have your payment system to automatically capture payments.
It’s very likely there’s that option for whether you want to manually or automatically capture payments.
You always always want to choose automatic.
Thanks for letting me share this story with you. I hope you learned something from it.
If you have any questions, let me know in the comments below!
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