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Last Update: Friday April 19, 2019

Key Idea: Create A Win-Win

Nicole Miller's designs and Bud Konheim's sales skills helped  build a profitable division of a conglomerate which they "bought out"  to create their own business. Be sure to study the transcript.

Key Question:

A: 

Think of ways to help the people who will help you.  This is how Bud and Nicole got started with almost no money of their own. They were employees of a large company and they recognized an opportunity not being exploited by it.

Bud went to the leadership and explained what he and Nicole wanted to do.

Bud proposed that he help the big company by selling it out of its current inventory then he and Nicole would basically spin that division off into what is now the Nicole Miller Company.

Q: What makes any proposal risky?

A:
The people in power can tell you, "No." However, it is better to try to do the right thing by being honest and open than it is to try to deceive.
 
You have to live with yourself.

The stories about Enron, Worldcom, Tyco, HealthSouth and Parmalat haunt us. These are publicly-traded companies that were lead by men who tried to deceive.

Yes, they all made millions and in some cases billions of dollars. But for what?

The business owners we study here are like Bud and Nicole. They have a real product and they believe they can deliver it to customers at a fair price. Period. They tell the truth, work hard and long, then smile when they see the balance sheet.
 

Q:  Should I take a partner?

There are many facets to the key question: "How do I get started in business?" Be sure to click on #2 to dig down further.

There were two sets of initial partners.  First, Nicole and Bud had to decide to be partners.  Then, Nicole and Bud had to pitch their employer to be de facto partners in the early stages of this business.  It was a brilliant strategy.

Money.  Because Bud and Nicole were employees of a large company -- they had almost no money of their own.  They were ingenious to propose to their employee that they start their business under their umbrella.  Though they thought they recognized an opportunity not being exploited, we all do when we start!

Job definitions. With Nicole focused on new product development and Bud focused on sales and marketing, they divided the classic tasks of a classic start-up.  They learned about working with each other in a new way -- partners.  

But it is still not easy.  Be sure to watch-listen-read all the clips and study guides that address the question, "Should I take a partner?"

Think about it

When have you missed an opportunity to create a win-win?
 

Clip from: Nicole Miller - Fashion & Quality

Nicole Miller on her visit to her boutique in La Jolla.

New York, NY: In this episode we go to the heart of the fashion industry and behind the scenes of Nicole Miller, a fashion house on Seventh Avenue to meet the founders, Nicole Miller and Bud Konheim.  In an industry where even top designers have taken production overseas, Nicole Miller pieces all proudly wear the label, "Made in New York."

It's a stroke of genius for these times, but the reasons go far beyond patriotism. For Nicole Miller, it's all rooted in the fabric of the American entrepreneurial dream: pride of idea, of process, and of execution.  They earnestly try to make women happy and  they are key advocates for causes important to women.

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Nicole Miller Fashions (BK)

Bud Konheim, Co-founder

525 Seventh Avenue
New York, NY 10018
2127199200

Visit our web site: http://www.nicolemiller.com

Office: 2127199200

Business Classification:
Fashion

Year Founded: 1982

Create A Win-Win

BUD: We were in another business – Okay -- Nicole and I. I was managing director of that business and Nicole was the designer.

HATTIE: You were not the owners?

BUD: No – It was a conglomerate actually. One division – we were very profitable, we were doing very well. And, we decided to go out on our own. And, we actually went out on our own with the blessing of the guy who was the head of the conglomerate because he was a friend of mine and it was great. I went to him and I said you have 12 divisions here – I am just one division of this thing. Nicole and I are going to go start our own business.

He said, “Well, I kind of would expect you to.” It was not a big surprise to him.

I said, “I'm not going to do anything to undermine you.” So he said, “Look, I tell you what, if you would get me out of your inventory. And get me dollar for dollar for your inventory -- I will not only give you my blessing, but I will – I know you are going to Hong Kong to do some business -- I will pay three weeks of the salaries of the place while you go to Hong Kong.

And then you come back and you can flip your thing – take all of the people you want – close the business – but you get me out clean.”

And that was the deal, and it was all up front and he was a great guy for that.

HATTIE: So the company you were in actually helped nurture the launch of Nicole Miller. Why was it so successful from day one?

BUD: Well, day one was not exactly day one. Day one was a change of name as far as the customers went. What we did was we had, in a three week period that my employer was paying the salaries and wishing me well, we had our sales people informing all of the customers that everything they had on order was going to be shipped as of June 1st, 1982 – they were going to get their shipments on time, just the way they ordered them – but the name on the label was going to be Nicole Miller. And they were going to get an invoice from Nicole Miller and they were going to pay Nicole Miller. We were just switching the names.

And there wasn't a peep.

Everybody went along with it because all they wanted was the merchandise – it was fine. Our first month we shipped $600,000. It was wild – we will never be that profitable again because we had absolutely no start-up costs - we had nothing. It was lucky in a way, but we had prepared for the luck. It was like – we gave luck a chance to happen.
 
 
 

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