Doing What It Takes. The Sweet Smell of Profit

December 28th, 2012 by Rich Christiansen

Today is the 26th of December and it’s been snowing aggressively all day. Cars are slipping and sliding everywhere. To be honest I was very concerned not only for the weather, but because I knew our 4th quarter was somewhat in jeopardy. We had a tremendous volume of orders, but with all the bad weather many trucks had been delayed.

As I arrived at the office I saw Jared Maruji (who was hired one year ago as an intern) on a forklift and I gasped as I saw the forklift slipping and sliding around the parking lot, losing traction. You see, one week ago Jared had never driven a forklift. Curtis Blair, our general manager looked at him and said, “I haven’t either. Figure it out.” Jared said, “Will do.” That’s indeed the attitude I’ve seen the entire day. We’ve not just filled up our warehouse. We’ve not just filled up our neighbor’s warehouse. We’ve also filled up the largest shipping group’s warehouse down the road in an attempt to get all our orders out and fulfill a tremendous 4th quarter.

I can’t stand talk, but what I love is action and results and today I’m proudly declaring that Froghair has lived the results of establishing a powerful, value culture. It was an impossible situation. Everything that could go wrong went wrong from constant snow, to three trucks backed up, to not many people available in the office, yet everyone who was available jumped in to help. They showed incredible competence. I didn’t need to give any ra-ra speeches either. Cooperation ensued. Everyone went and just instantly hit the problem area, sensing what was going on, and solved problems all on their own. Incredible independence as well as accountability was shown as everyone jumped in to help. Everyone else wanted to be skiing instead, but they didn’t leave. They stuck it out until everything was taken care of and solved.

Those key elements are just a few of the values that Froghair employs. And I have to tell you, what is the result? I’m very proud at the very end of the year to announce that Froghair has endured, sustained, and expanded which is the key purpose of having values. ??

If you’ll recall the first year of this little company we grew from $5,000 to just over $3 million in sales. This year we’ll come close to hitting $5 million in sales and my expectation for next year is that the team will indeed double that. Doing what it takes and being willing to make sacrifices is 9/10ths of succeeding in business. And by the way, working hard on the 26th of December, the day after you’ve drunk a little too much eggnog and eaten a little too much Christmas candy results in the sweet smell of profit. I tip my hat to this Froghair team. I commend them for what they’ve done and I challenge each of you to set your values the first of the year and be willing to do what it takes to succeed. Quit grumbling about it. Get out and make it happen. You can do it.

Premature Diversification

December 12th, 2012 by Rich Christiansen

Rich Christiansen The past several weeks I’ve been preparing for a trip where we will represent several up-and-coming, exciting brands for one of my companies. Through the course of these activities I’ve been exposed to several very creative and very innovative ideas and concepts.

There’s one company in particular that has received an extreme amount of attention. They were featured on the television show Shark Tank and were indeed one of the winners. They won again at a statewide entrepreneurial conference and have received an excessive amount of media and exposure. As I met with these young entrepreneurs I was exhilarated but also dismayed in our very short meeting. Their high-energy level, exuberance of entrepreneurship, and the zeal for which they were attacking opportunity was exhilarating. However I was dismayed as I saw what they were doing. Indeed they had come up with a very novel creative market concept that had been broadly embraced and was getting them a lot of attention. What did they do with it? Rather than dig deeply, rather than fully explore all the channels, rather than totally take advantage and captivate this corner of the market they’ve instantly started to branch out and add all sorts of diverse products. For instance they were scheduled to fly down to meet with a celebrity’s daughter the following day to start a new line of handbags. They’re developing cell phone technologies, literally exploiting the small channel that they’d developed on ancillary things that haven’t yet proven success.

Indeed my one of the entrepreneurs that I really respect is David Norton who will often make the statement that the reason for failure in small businesses is premature diversification. I personally think that the number one reason is cash flow, but I agree with David that the second reason is premature diversification. If I were to wind the clock forward several years I would suspect that these young entrepreneurs would learn this lesson (hopefully not too much the hard way).

In the early stages of our business we need to find something that works and do more of it efficiently and effectively and fully develop the channels and make sure you have adequate conversion before you diversify. It’s not to say that diversification is not appropriate, it’s just doing it at the right time.

Go forward, prosper, and win in your business.