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Last Update: Saturday December 7, 2019

Key Idea: Recruit Your Competition

Owner Jeff Presant said his dad got a fast start by bringing in his competitor.

Key Question:

A: 

Yes.  You can hire it and you can offer some type of ownership.

Mr. Presant had the idea for All Brand and he had the financing but he knew at the outset, to his credit, that he needed someone who understood the business.

Q:  What did this veteran appliance repairman do to insure that his success in the wholesale parts business would come early rather than late?

A: 
First and so unlike many business owners, he knew what he didn't know. So many of us dive in with confidence we can learn anything and do anything. This is probably true but the problem is that we may run out of money before we learn enough to make a business work. By knowing what he didn't know, Mr. Presant went searching for knowledge and experience to help him launch.

Mr. Presant's source for parts had a monopoly and had become arrogant. He was able to talk the manager of that store into going into business with him. This was a perfect start-up strategy that worked well for years. In hindsight, Mr. Presant may have been smarter to offer the manager a management role but not an ownership role.

Business is never just business. In fact, J.C. Penny said, "Business is built on friendship." When Rick joined the company he had a personal conflict with his father's partner. Rick knew from watching his father that owning a business takes a huge commitment, and he didn't want to spend 50 or 60 hours of his time every week with a person he did not enjoy.

A business partnership is like a marriage and should be entered into seriously. A business "divorce" is very stressful and will cost all parties involved money and enormous anguish. Rick was right not to join his father while the old partner was involved. Eventually the two founders decided to "divorce" at which time Rick came back then with his brother, Jeff, eventually bought the business from his father.

Think about it

Can you buy your competition rather than hire talent away from it? Can you hire talent away from competitors without making the new person an owner?
 

Clip from: All Brand Appliances

Mount Ephraim, New Jersey: In this episode of the show we go to Main Street America (just outside Philadelphia) to look at a classic family business, one that exists in most communities in America but seems to be threatened by new distribution systems and mega-stores like Lowe's and Home Depot. Talk about pressure... Yet, these small businesses may actually thrive in our fast-paced, ever-changing business culture. Best practices is what they do.

If a washing machine breaks, the parts needed to fix it are on the shelf of their store. Owned and run by brothers, Rick and Jeff Presant, the pros, the handyman, and the weekend warriors (honey-do's), are all welcomed to buy appliance parts at All Brand Appliance. With 12 employees and hundreds of ever-faithful customers, these two are building a business on kindness. That's right, kindness.

To prepare to buy All Brand from their father, Rick had his own supply company in another territory and Jeff worked for others.

Go to all the key ideas and videos of this episode...

All Brand Appliance (JP)

Jeff Present, Co-owner

170 North Black Horse Pike
Mt. Ephraim, NJ 08059
800-736-5870

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

Office: 800-736-5870

Business Classification:
Retail/Wholesale

Year Founded: 1984

Recruit Your Competition

HATTIE: He recruited his competitor.

RICK: His competitor, who was one of the most knowledgeable men in the industry, and had a following of repairmen who really enjoyed and liked dealing with this man.

And when I got out of college, reality hit. And there...

HATTIE: What do you mean, you had to pay your bills?

RICK: I had to pay my bills. Somebody once said to me--he asked me what I did, and, you know, I said, `Well, I'm majoring in political philosophy.' And he said `What, follow flies?' And I think that man said more than he realized, and it opened my eyes.

HATTIE: And you decided to learn about parts instead of politics.

RICK: Yes. With what I had a degree in, I could either continue my education or I had to get a job. And I think I actually did, I cut lawns one summer, you know, just to have money, and I gave things a lot of thought. And I realized I had an opportunity here; I had to take advantage of it.

HATTIE: Did your father say, `Whenever you want to work in this business, Rick, we've got a job for you,' or did he say, `I expect you there,' or--you know, what was his point of view on it?

RICK: Well, it was pretty much like he's handled everything with us. He let me know there was an opportunity, but it was my life, I could do what I want with it.

HATTIE: So there was not a lot of pressure.

RICK: No pressure at all. And because I couldn't use my education, I almost, in some ways, felt like I had failed. And I went in there determined to do something, to make my mark somehow.
 

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