There’s so much wisdom to be learned from those of us that have “been there, done that.” In this blog post, I’ll share a few more of my favorite “things you should never do,” gleaned from some of America’s most successful entrepreneurs.
Never…
1) Believe Bigger is Better
It may seem natural to assume that large firms with hefty fees and impressive client lists are a good bet for pet industry entrepreneurs. But if you need to hire a PR firm, accountant, lawyer or other service provider you could make out better by selecting a smaller, hungrier entrepreneurial firm that will be as eager to have you as a client as you are to have their services.
That’s the lesson Amilya Antonetti, a featured expert on The Big Idea on CNBC and founder of Soapworks, learned when she hired a big public relations firm to help turn her all-natural soap-based home cleaners into a national brand. While she funneled her precious capital into the PR firm, Antonetti willingly went without a paycheck. Still her sacrifice did not pay off. The PR firm devoted its attention to its bigger clients and generated no results for Soapworks. Instead it sapped several years of the company’s cash growth.
Antonetti found a younger, more aggressive firm to handle her account, one that got her the results she craved using cost-effective marketing, consumer and corporate education, and guerilla marketing techniques. Soapworks products are now found in grocery stores, drug stores and health supply stores in close proximity to those of her billion-dollar competitors.
2) Put All Your Eggs in One Basket
One is not only the loneliest number, but it is the scariest too. A business that relies on a single supplier, vendor or type of customer is only one move away from disaster as Gary Hoover discovered when his retail travel store Travel Fest took a dive because it was too dependent on the airline industry.
Hoover had already sold two of his businesses to Dunn & Bradstreet and Barnes & Noble by the time he began Travel Fest and his newest business was also going extremely well. Travel Fest took off in the early 1990s as customers embraced its travel superstore concept of being open seven days a week offering everything from luggage to travel agents, language lessons and currency exchange services. Things began to fall apart, though, when cost-cutting airlines drastically cut travel agent commissions, an important part of the company’s revenue. At the mercy of an industry he couldn’t control, Hoover never saw the fatal blow to his company coming. He swears that he will never place himself in that position again and neither should you.
I have a personal story about how relying on one supplier took me days away from bankruptcy that I will share with you in a future blog post. Look for the blog titled “When The Bird Cage Lady Sings.”
3) Trust Everyone
Keeping on top of all the details of your business is important even if you implicitly trust your partners, investors and key employees. Remember, it’s not personal; it’s business.
For a lesson on what not to do, ask Judith Briles, whose venture as a hotel developer with a “friend” with whom she had worked on several profitable projects cost her more than $1 million. Looking back on it, Briles says she realizes she missed several red flags about her partner because she was too trusting. She says she didn’t realize that her partner had a cocaine addiction and was doctoring and forging bogus invoices to fund her habit. To make things right, Briles says she had to sell her house and her family’s clothes to satisfy her creditors after her partner declared bankruptcy.
Briles got herself in this position despite having an MBA and a lot of intelligence. She resolved to never be taken advantage of again and went back to school to earn a Ph.D. in business administration with a concentration on behavioral sciences. She wanted to find out how she could have been so easily fooled. The experience changed her career direction and taught her the importance of knowing exactly where the money is going.
Do you have a war story to share with fellow Pet Style News readers? I’m compiling stories and lessons from pet specialty retailers for an upcoming “Do as I Say, Not As I Did!” column or blogpost. Send me an e-mail at carol@carolfrank.com.
Carol Frank’s consulting firm, Birdseye Consulting, can be found online at www.carolfrank.com.