Question for any business owners out there making a physical product - do you guys have to pay suppliers with cash? None of ours take bitcoin. And if so, how do you balance wanting to grow your business (which requires making more product and thus needing cash) with holding bitcoin? This is something I’m still wrestling with. I’d love to keep and hold what little bitcoin I have… but I have to make more shirts to keep growing the business. Down the road, when my business is bigger, and we’re able to distribute profit and/or have cash we don’t need for growth (hopefully 😂) I could see that being much easier. But at my stage now, we’re still trying to grow. Not for some vanity reason but to survive. Curious if anyone out there has some thoughts or strategies around this?
Discussion
None of my suppliers take Bitcoin. And I have zero reason to waste cash on a tracked transaction. Check or CC.
Good point! when I say cash what I really mean is CC (we just sell online). When your customers pay with CC, is that in USD? Or bitcoin? And if bitcoin, do you have to convert to USD to pay suppliers?
Same as others have answered. I don’t find it plausible to circulate the Bitcoin earned from sales for new inventory, at least at this point in time. Some ways I will consider recirculating it would be for software services, marketing, etc.
Just my Canuck two sats.
If you personally can afford to buy some ₿ from the company, do it. If cash is tight, consider selling peer to peer. Bitcoin is meant to improve your life, especially while building a great company. There's no fast rule for holding. Especially as you pour your heart & soul into your creation.
It's about the opportunity cost, if you are constrained by your stock and get hurt by not meeting demand is that worth bitcoin going up to “your price” does an extra 10 shirts equal 8 loyal customers and referrals for years?
As for suppliers, education and perseverance. Try offering half payments, and initial discounts, and ask every time. I have been working with my compost guy for 2 years but he asks me the odd question when I bring it up, no trade yet.
If Bitcoin is to be adopted as a medium of exchange, along with store of value and unit of account, then we need to use it as such. Important is that you take in more bitcoin that you spend, aka create value so you are gaining in reserves... I know the tax issue comes up, but zooming out there is a solution to the tax issue which I can elaborate on if anyone is interested... Regardless, live in the new paradigm, and visit the old as needed until it is no more.
On the tax issue:
I sell physical product for Bitcoin, specifically handmade blankets and hats. I only get paid in Bitcoin. I do not do sales in any other currency.
I work at a small scale so I don't have the leverage with my vendors to ask them to accept Bitcoin. I pay for my supplies and shipping in USD. When I need USD to buy supplies, I convert using Strike.
At a larger scale, you can consider approaching your vendors with paying invoices in Bitcoin. You can also pay your employees in Bitcoin, either wholly or partially. I know a restaurateur who does this and they say employee loyalty and morale increased.
We posted a similar question yesterday! Nice to know we aren’t the only ones trying to figure this out with physical products. We get cocoa beans from small, rural producers in various countries, but none of them accept bitcoin (yet)… and great cocoa suppliers with ethical standards, organic certification, and high quality beans are hard to find as it is. Plus other obligations aren’t going to be payable via bitcoin overnight. We’re taking baby steps… likely going to start accepting bitcoin shortly, but will need to convert to usd regularly until we have more profit and/or convert our vendors over time 🤞