Think small. That was the basic starting point for Mike Cayelli when he decided to open an online retail business two years ago. With a tiny house, little capital to invest, and only “spare time” to devote to the project, Cayelli knew his big dream had to stay manageable. The Washington (D.C.) entrepreneur still hasn’t quit his day job, but he’s projecting $500,000 in sales this year for his company, Cuff Daddy. You have a full-time job. Why start your own company? About two years ago, I was working for [a hardware chain] as a manager in the regional professional contractor division. I still work there, in fact. But there was some reorganization going on, and I became concerned about my future. So I wanted to hedge my bets by starting my own company. How did you settle on becoming an online retailer? I wanted to emulate my cousin, who’s been enormously successful selling mobile phone accessories online. He imports products from Asia and realizes a substantial profit margin. I also wanted to do something purely on the Internet so I could keep working at my “real job” and develop the company in my spare time. Your major concern was finding a niche product that was physically small. Why? Well, we had a small house that I planned to use as headquarters. So I needed inventory that I could store in a footlocker, have my wife ship out of a home office, and haul around in a car instead of a truck or trailer. As for shipping, about 90% of our orders can be mailed first-class with two stamps in a .13-cent padded envelope. How did you settle on cuff links? It was not easy. I spent several months looking at things like buttons, watchbands, shoe laces, and collar stays. Every time I thought of a small, niche product I’d write it down on a scrap of paper and shove it into my pocket to research later. I wanted a product that could produce high sales volume and a high profit margin. I didn’t want something that sold one unit per week. So when I got an interesting idea, I would search for it on eBay and run it through a research tool called Andale. For $7.95 a month, you subscribe to this Web site and you can get diagnostic information about any product’s online sales volume and average selling price.

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