MANAGING
FOR MONEY
The Right Mix.
A musical engineer builds a humming window coverings business.
by Steven C. Bursten
This is the fourth in a series about business owners who manage as a model operation for their sales volume. From a growing personal business under $300,000 yearly to a mid-range $500,000, and then to a managed business in the $1.5 million range, we have explored highly profitable businesses managed correctly by the numbers and making a lot of money for the owners.
EXECUTIVE LEVEL
This month we cover the rare breed of executive level business I define as $1.5 million to $5 million-plus. All-Phase Blinds and Shutters with three locations in North Carolina, two in Raleigh and one in Wilmington. As you will see, this is an exceptional operation, managed by the numbers. But, possibly more important, this is one of the first leaders in the blinds business to make the transition to a balanced mix of draperies and blinds.
I have written about the need to make this transition and lift yourself above competition. Marion Gainous is one of the first to do it correctly, and it is making a huge change in his business, as you will see.
EXAMPLE OF GOOD MANAGEMENT
All-Phase is a $4 million operation owned by Marion Gainous with the support of key execs Dick Weber and Marty Smith. It is one of the best-managed businesses in North America. Gainous came to the window coverings industry from an engineering and heavy equipment background, approaching his new challenge with scientific diligence and determination to succeed. But don’t think he is only left-brained, sequential and numbers oriented. Gainous is also a musician and artist. How often to you find that in an engineer?
Over two or three visits, I had the pleasure to observe Gainous’s exceptional management. Start with operating a multi-million-dollar business from a 600-square-foot branch showroom. Finally, after eight years, the company moved to a 3,000-square-foot office space in 2005. Another example: a competitive-analysis study that was the best I have seen in the industry. Gainous knew more about competitor strengths and weakness than some of their own salespeople!
Next, Gainous knows that, “If you can’t measure it, you can’t manage it.” By tracking critical metrics of appointments, closing ratios, average size of sale, product mix and more Gainous can set incentives and bonuses and move the business in the best direction to maximize profits.
FROM BLINDS AND SHUTTERS TO FULL-SERVICE, BALANCED BUSINESS
Most recently, Gainous has taken a step many have tried and few have succeeded: to move what originally was a blinds and hard window products business into the new dimension of draperies and soft products. Draperies are becoming the strongest growth segment in many regions for dealers who can make the cultural change from selling competitive products to selling ideas and creativity.
So, here is the story of All-Phase Blinds and Shutters and Marion Gainous, how he started and built the business, along with the challenges and changes that inevitably occur in any growing business.
How did you start your business?
I was an engineer and vice-president of a large company in the hydraulics industry when I decided to change careers in 1996. I was looking for a new challenge and did a lot of research into the type of business I felt would be a good fit for me. When my business broker connected me with a very small blind company in our area, I felt the combination of my engineering and business background, and my artistic skills would serve me well to grow this company.
What were your first years like?
Our first years in business were very busy and quite successful—selling and installing two-inch blinds, mini-blinds, and honeycomb shades. But I really worked hardest at educating myself with product knowledge, background information, marketing operations and systems. I wanted to know everything I could about this business of window treatments, so I threw myself into it. In the beginning, I worked an 80-hour week—50 hours running the company and another 30 hours learning about the products I sold.
Within the first two months, we did more business than the previous owner had done in one year. After a few months, Marty Smith brought her talents to our office, mostly developing all of our current office and warehouse procedures. She grew the office to a staff of six that she personally hires and trains. Her background in publishing also helped us develop very professional literature and advertisements, which helped us to stand out early.
After eight months, my previously-silent partner quit his job and started working here full-time because sales were taking off and the company was growing so fast. Dick Weber also has an engineering and sales background, and his gregarious personality is perfect for our customer-service philosophy. He now manages the ever-growing sales team. In our first years, we made every mistake you could possibly make, which helped us to figure out exactly what would work.
What have been your motives to change?
My biggest motive to change has been to keep a balance and clear perspective on both my personal and professional lives. I need to keep my company strong to survive slow times in the economy, and I’ve consistently worked hard at figuring out what works best for us and our 18 employees.
One of the turning points in our business was when we all realized that over-servicing our customer is what makes us most successful. Our customers love the attention we give them and 60 percent of our business comes from referrals.
What differences have you observed over the past five years?
The biggest change that I’ve seen is the influx of Chinese products in our market. We have had to learn how to adapt in order to compete and include these products in our sales. Another big change has been the education and savvy our customers now have thanks to available Internet research. We need to provide the best possible products and service so they keep coming back to us.
What feelings or fears did you experience as you underwent changes in your business?
To be honest, I was never fearful because our hard work brought us success right from the start. But in order to maintain that level of consistency, we spend a lot of money educating our employees, both with comprehensive in-house sales training and teaching extensive customer service techniques and skills. On-going education is our most important sales tool.
What has the experience of transition and change been like for you?
During our first years in business, we sold one or two particular products: blinds and shades especially. We had a corner on that market and were very successful.
In recent years, the window coverings market has exploded with incredible fabrics, hardware and trims. There’s more competition out there on traditional hard products. Draperies lift you out of the competitive battlefield. We believe our sales staff needs to be on top of all the market trends.
Our decorators enjoy using their creativity to design, select and sell beautiful draperies, and the Roman and roller shade market has changed drastically to include stunning designs and colors. We’re seeing that part of our business grow tremendously.
Where has the change in trends brought you from then to now?
The trend for custom window fashions has increased our business because we offer our customers so much more. We’ve become very well rounded, offering a diverse product mix to suit all tastes and situations. Our business has retained its market share, its customers, and its employees without giving up growth and profit. I’m proud that Dick, Marty and I have worked so well together for the past decade to grow our business into a multi-million dollar operation that continues to thrive and create excitement for our customers and our sales teams.
How do you see your future ahead?
We operate two retail showrooms, two warehouse facilities, and also sell custom window products nationwide through our Web site. We see our future developing with much the same processes that have gotten us this far—working hard and continuing to make smart changes to help us grow effectively. We’re constantly tweaking the systems we have in place to help our employees continue to grow in their jobs as well. We couldn’t have gotten this far without the wonderful people who work with us.
If you were to go back to work for a large corporation, how much would the company have to pay you to give up working for yourself?
It would take a lot more than money to get me to go back to work for a large corporation. I just wouldn’t do it again. I’d rather make less money in my own business and keep my peace of mind.
What would you tell other people about pursuing a career in the window coverings industry?
Having your own business is a huge challenge, but it can give you enormous freedom. You can make a great living, but more importantly, it can help you to find a balance for your life. As long as you have a strong work ethic, good people around you and you make sound, educated decisions, being in this business can put in you in control of your own destiny.
LEADERSHIP AND MANAGEMENT WIN THE DAY
Gainous presents a great example for all of us. As an engineer he knows the numbers. As a musician and artist he has a sense of emotion that appeals to his customers. Possibly that is what helped him see the trend to custom draperies—now growing at an increasing rate and setting leaders above the competitive battlefield.
Follow Gainous’s example. Move yourself up to better customers, higher margins and fewer competitors. The air is mighty fine up there!
This article is based on Steven C. Bursten’s actual experience with sales and financial information working with hundreds of window coverings businesses. Whether you are a sole manager who aspires to higher sales, or you manage 50 window fashion decorators in a multi-million dollar business, this series will help you manage sales better and increase your profitability. Bursten is the retired founder of Decorating Den Interiors and author of a how-to book on new business start up, “Bootstrap Entrepreneur,” and is a leading expert in window coverings marketing, sales systems and sales management through his company, custEmers.com. Questions and comments welcome: steveb@custemers.com or call (888) 333-8981.
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