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Last Update: Monday December 18, 2017

Key Idea: Be Willing to Reinvent Yourself

To move out of an executive office and back to serving customers, George Granoff bought an anemic little chain of art supply stores.

Key Question:

A: 

Think hard about what you most enjoy.  George had worked his way to the top of a large retail organization and he missed not being with customers.  This was the driving force behind him getting into business for himself.  He looked around and found a small group of stores that was under performing.  This made the chain affordable for him to buy.

George was able to purchase The Art Store at a bargain price. Owned by a huge paint store chain, The Art Store had never been profitable. When George bought it, The Art Store had nine locations, all in California. After studying the numbers, George discovered that four of the nine locations were quite profitable and the other five were doing poorly. He sold the underachieving stores, invested all of his time and resources in the four good stores and began to make money.

Q:  What are some of the advantages of size?

A: Purchasing power increases with size. You can negotiate the best pricing from vendors if you promise to buy in large volumes. Size can be an employee recruiting tool if you are known in the community as a good employer.

Any system you put in place can probably handle more capacity than a very small business could generate. The Art Store computer, for example, handles the point of sale inventory, cash management, customer database and many other functions for all five stores. Adding another store will not increase the cost of computing significantly.

Some business experts believe when a company gets more than 100 employees it begins to be less efficient as a team and the gains achieved by size begin to diminish.

Q: What are the changes George has made since he became owner?

A:
The stores have new floors, new ceilings, new lighting, wider aisles, new signage, point of sale inventory controls and a new approach to displaying products. For example, he is now hanging the paper in customer view rather than keeping it in drawers. By seeing all of the choices, the customer can more easily visualize how to use an assortment of special paper rather than simply look in the drawers to find what they intended to purchase.

Think about it

Are you happy in your work?  What do you most enjoy doing with your time?  What changes would you have to make to start doing more of what you want to do?  What would you have to give up in order to have your dream work?

Clip from: The Art Store

New York City, Los Angeles, Boston, San Diego: In this show you meet George Granoff, a corporate executive turned entrepreneur and small business owner. He bought and turned around a failing group of art supply stores. Ever since graduating from college, he's worked in huge retail companies. He learned a lot. Then he took those years of experience to apply to a bankrupt chain of retail shops, The Art Store.
 
George's extraordinary business experience taught him much about scale, critical mass, and volume. Having run huge retail chains, George just couldn't imagine a business that is so small you can't enjoy the benefits of size.

To start a business from scratch would be too slow for George, so he bought an existing business in distress. The Art Store was a bargain. Like George, you don't have to start a business from scratch. Buy a business!

The Art Store

George Granoff, Owner

1844 India Street
San Diego, CA 92101
6196870050

Office: 6196870050

Business Classification:
Retail

Year Founded:

Be Willing to Reinvent Yourself

HATTIE: Hi. I'm Hattie Bryant, and welcome to SMALL BUSINESS SCHOOL. If you have a business, or want to start one, this is the place for you. Last week, wholesale, this week, retail. Today, we go to San Diego, California, inside The Art Store.

This is a how-to series about starting, running and growing a business, and we think you learn best from people who have already done what it is they're talking about. In academia, they would call what we do here a Master Class. That is, you don't have a professional teacher with a specific curriculum. You have an opportunity to meet a person who will tell you how it is they do what they do. This is not a class, it's an experience. Grab a pencil and paper. You'll want to take notes.

(Voiceover) After 30 years of working for huge companies, George Granoff is now an entrepreneur. Even though he lives in Boston, he owns The Art Store, which has locations in California and New York City.

GEORGE GRANOFF (Owner, The Art Store): I woke up one day and realized that I really enjoyed the hands-on store level, working with customers, building business.

(Voiceover) I poured a lot of money into the plant in order to put in new floors, new ceilings, new lights, new fixturing. We widened the aisles.

Basically, the attempt was to improve the shopping experience for the customer.

Unidentified Man #1: It's just a lot easier to get to everything. The paints are with the paints, the brushes are with the brushes.

GEORGE: One of the important things that I think we accomplished when we attacked these stores and remodeled them, was to identify certain classifications of product that perhaps we could show in a manner that was more customer-friendly. In the past, all these papers were shown--were carried in metal drawers and the customer had to go through individual drawers to take a look at what our assortment was. We felt that our assortment was so interesting that it would create much more impact if we had it out and visible to the customer. So we got rid of all those drawers, and put all the paper out.

HATTIE: So this is a new invention.

GEORGE: This is a new invention. We have experienced--the down side is, we have experienced some damage due to customer handling of the product. But our sales of paper have exploded because the customer can come in and at a glance get to see the huge assortment of paper that we carry.

Unidentified Man #2: OK, so a shade of this between the two should do the trick?

Unidentified Man #3: Mm-hmm.

Man #2: OK.

Man #3: Yeah.

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