Pathfinders
"Yep yep yep, yep yep, um um um um, get a job!"
-- The Silhouettes
Our career paths take many turns. Depending on what age you start working, the road can be very daunting. I was enthralled by driving my own car. It was a sign of independence and maturity. That obsession drove all of my work ethic. I started trying to earn money at a very young age, but it wasn't how much I made so much as it was that I had some when I needed it.
Odd Jobs, Inc.
When I was sixteen I bought my first car with $300 I had saved up doing chores and from birthday and Christmas gifts. It was a 1959 VW Bug I found parked in a vacant lot. It had weeds growing up through the open windows and the headliner was shredded. I spoke to the home owner and he said he "wasn't sure it ran."
I got some friends to help me roll it into the street to jump start it. It ran great! Later I realized it had no battery, so for the first few weeks, until I could collect some cash to buy a new battery, I had to jump start it everywhere I went. I would park it with the front right tire on the curb, so I could get it rolling, then jump inside and pop the clutch.
I started driving my friends to school, and we all needed money so I proposed a business. I called it "Odd Jobs Inc." We printed up flyers and business cards and posted them on shopping center bulletin boards. I fielded calls from people who needed simple chores done around their house. We would do house cleaning, yard work, move furniture, pickup trash or run errands. An old lady hired us to move her sofa from one side of the room to the other. I scheduled the work, delivered my workers, provided some tools, and brought them home. I charged $10 an hour: They split eight and I kept two. I have wondered sometimes what would have happened if I just kept that business forever?
Later I took a job washing dishes at a small Mexican restaurant in the Malaga Cove Plaza. I think I made $1.25 an hour, but it only cost me about $4 a month for gasoline.
Now I had "Dishwasher" on my resume which helped me later when I went to college. Since I had to live on campus my freshman year, it made sense to get a job in the cafeteria that served the dormitory. I ran the dishwashing machine and mopped the floors.
During Summer Break I worked in a gas station in the Malaga Cove Plaza. On my very first day there, I checked the oil in a newer Mercedes sedan. When I got the oil can open, I poured the oil into the radiator by mistake. The station owner had to rack the car and drain the radiator and oil, just in case. The car's owner wasn't too happy because it caused a two hour delay. I never made that mistake again…working in a gas station.
Ski Racquet
When I left for college my mom had decided to go back to work, so she took a job with a friend who had just opened a new ski/tennis shop in Torrance. She talked them into hiring me at Ski Racquet to work on skis, mount bindings, clean and restock rentals and just do odd jobs around the property. I squeezed in 15 hours a week during classes and more during holidays and semester breaks. In my second year I started commuting and worked 20 hours a week all during ski season.
Owner Ron Goodrich was a flamboyant entrepreneur. He had started several businesses, and was always running numbers. We would have lunch and he would tell me exactly how much the restaurant needed to operate profitably based on the estimated square feet of the store. If they served 500 meals, at X number per meal, with 3000 square feet, they could hire X number of employees and make X amount of profit. It was always all about math to him.
He was determined to expand his business and rapidly opened several new stores. It was apparent that he didn't consider me management material, so I moved on.
Ski-Surf Shop
Owner Dick Mobley was an anomaly: A very tall man, a respected surfboard shaper, he was known for his uncanny ability to spot social and cultural trends and business opportunities. Once he decided to focus on the snow ski business, he smartly bought an old house on a main boulevard, and went headlong into the business. His wife Carlene was a talented business manager and bookkeeper. She managed the Ski-Surf Shop finances while Dick controlled the retail end. He realized early on that he couldn't, and shouldn't, compete with the discount sporting goods chains like Big 5 Sporting Goods. He went after the more sophisticated and advanced skiers, offering the beginners advice, but focusing his equipment sales on the intermediate or advanced skier.
When I arrived in 1973, his business was just starting to explode. The shop needed to expand and Dick was receptive to my remodeling ideas. That was my first exposure to design and construction, and it was incredibly successful. We lopped off the roof and added a second floor equal to the first. We had to use an outdoor stairway due to some ancient code, but it actually added an element of "cool" to the already funky building. He expanded his clothing selection, occupying the entire upper floor.
My mom became his clothing buyer because she had proved, during her time at Ski Racquet, to have a great sense of color and design. Each year for the next four years, Mobley doubled his business, and the majority of that came from clothing sales.
I ran the boot department and it became my badge of honor. I learned about orthotics and how supporting the human foot properly relieved many of the painful aspects of snow skiing, and improved performance. I knew orthotics use would become more widespread, simply because the biomechanics of the human foot is so complicated, and most people suffer from collapsed insteps and flat feet. But I had no idea back then, just how huge the shoe insert business would grow to be.
The Rub? Dick Mobley gave me the incentive to try to build my own business. His enthusiasm, confidence and entrepreneurship rubbed off on me.
Stinger Honeycomb Water Skis
At some point I convinced Mobley to bring in water ski equipment during the summer months. That is what led me to encounter another transformational individual a few years later. Rick Reulos walked into the Ski-Surf Shop and wanted to talk to me about water skiing equipment.
He was a very young, well dressed and articulate guy. He had a bright smile and eventually told me a story I found hard to believe; He said he had made a lot of money as a young man when he hooked up with a guy that fabricated beautiful wood laminated slalom water skis and sold them along the shores of Lake Sammamish, in the state of Washington. That enterprise eventually became O'Brien Waterski Company, and Rick made a fortune as a regional salesman when the company went international and became the dominant manufacturer in the sport. He went on to tell me many untold things about the history of O'Brien and how everything had changed. More about that later…
About a month later he showed up at the ski shop again. He took me out to lunch and continued his story. He was a slick talker, a fancy dresser and pretty cocky. He was forming his own sales organization called Solar Sports, and wanted to have a young, aggressive and sociable guy to go out into the marketplace. He said he had watched how I handled customers and thought I might be a fit for his business. One of the engineers from O'Brien, Denny Kidder, had started a new ski line called Stinger Honeycomb Water Skis and it was quickly becoming successful. The O'Brien Company had recently been sold to a large outdoor sports and recreation company called Coleman Industries, and Rick and Denny were convinced that represented an opportunity for a young, high-tech oriented manufacturer to grab market share.
Denny was Stinger Skis manufacturer and Rick's Solar Sports was the Western Area Distributor.
If I was interested in repping Stinger skis, he said I could start out part-time and transition to full-time. He would provide me with a new van, and a small monthly salary, plus a small commission based on sales. It took me about ten seconds to say yes…
I had always envied many of the manufacturers reps because they seemed to have a great lifestyle. I was certain I could do the job.
A few weeks later he came to town with a Winnebago motorhome and we went on a five day sales training trip, which started with a shopping spree along Rodeo Drive in West Hollywood. He wanted to buy me some "appropriate" clothes.
As we walked along the storefronts, I noticed a woman walking towards us. She was with a female friend, and she simply commanded my attention. She had a mane of flowing blond wavy hair, and a wide, bright smile. She was twenty feet in front of us and I was immediately transfixed. As we were about to pass each other, I diverted my stare so as to not embarrass myself. As we passed, I swear I could feel the heat from her aura.
Rick and I both turned to watch as she walked away. Rick said, "Not bad, huh? That was Farrah Fawcett!"
At that very moment I realized I had made a Game Changer decision about my future. I had spent many years working in retail stores owned by someone else. While I was manning the store, the owners were traveling and living the good life, and I knew it was time for me to move on. In college I had a poster of Farrah Fawcett hanging in my bedroom. She represented a certain image of youthful vitality, sexual freedom and happiness. Her energy was undeniable. That moment, when I saw her walk past me, left an indelible imprint on my psyche.
It was serendipitous!
I can't say I actually encountered her other than to brush by her on Rodeo Drive, but the fact that our paths crossed just when I was being courted by an exciting new employer, and had broken up with my longtime girlfriend, and wanted to reinvent myself, all seemed to be telling me I was going to be OK.
Rick and I spent a week driving up and down California in his Winnebago. He coached me on the finer points of searching for prospects:
"As you pull into small towns, go to the nearest phone booth and tear out the yellow pages under 'Sporting Goods' or 'Boat Dealers' and start calling them all to make appointments; Never underestimate the opportunities of dealers; Some of the biggest water ski dealers have shabby stores and frontages; Look successful and always be on-time; Make three or four appointments a day before moving on to the next to town".
A few weeks later Rick sent me to a Manhattan Beach Chevy dealer to pick up my new 1976 powder blue shorty panel van. I was responsible for outfitting the insides to carry and display Stinger Honeycomb Waterskis, Pro-Line ropes, vests, gloves and Knee Ski knee boards. I felt elated that I was officially an outside sales rep!
The Rub? The experiences I had traveling all over meeting with active business owners and buyers, finding my way around in foreign territory, sleeping in cheap motels and understanding the challenges of small business owners, was nothing less than a Masters Degree in Self Sufficiency and Outside Sales. As was my history, I passed the course, but I probably got a B-. I didn't make a fortune, in fact I was living paycheck to paycheck.
Ski Outpost
In 1977 I left LA, my parents and many of my LA based friends behind and started a new snow ski shop in Rancho Bernardo, a retirement-oriented community just 12 miles north and east of San Diego. I named it Ski Outpost. I decided it was time to turn the corner, become a San Diegan, and devote myself to the ski industry. I hung on to my Stinger job for a few months, but soon had to let that go.
I called my shop Ski Outpost because at that point in time Rancho Bernardo was just becoming a suburb of San Diego. It was technically the very first "Planned Community" so called because it wasn't just one housing tract. It was a series of communities built around a golf course resort, and it incorporated shopping centers, emergency facilities, schools and parks. My brother and I had identified it as a wealthy enclave of mostly upper-middle class newly or about-to-be retirees, but it was undeniably on the outskirts of greater San Diego. Its residents maintained the third highest average daily savings account balances in all of California. Located on the I-15 corridor, it was just the beginning of a housing boom that would eventually string Orange, Riverside and San Diego County together with new communities.
Remember earlier I referred to my dad introducing me to the concept of 'equity sharing'? Back when I was very young and wanted to tear up a corner of my childhood home's backyard in Altadena? Now I was able to buy a condo in Escondido because two and a half years earlier my dad suggested I invest in his rental condo to build enough savings so I could eventually buy my own place.
The plan was, since I had a van provided by Rick Reulos, I could sell my 1970 Chevy Camaro and he would take that cash as a ⅓ share in his rental property. I would occupy it as a renter, but when I moved out or he/we decided to sell, I would share ⅓ of the equity improvement. Thirty months later, when I wanted to move down south, our condo had appreciated by almost 50%, so he bought me out and I moved to Escondido. I used the cash on the down payment for my condo in a much more affordable real estate market.
It is a process called Equity Sharing. It was a brilliant tactic to get me involved in real estate investments so I could stop paying someone else's mortgage. It proved to be one of the most important financial lessons I ever learned, and it started with my childhood desire to build a miniature Disneyland in my parents backyard.
My brother and I began planning the Ski Outpost in 1976. He had the connections to get a small, unsecured, business loan, and to negotiate the lease for the commercial space. We opened the store in the Fall of 1977, and California was suffering a drought that year. Almost no snow except man-made snow in the local mountains. We lost money that year.
After a good snow year in 1978, and the Ski Outpost had a break-even year, the Energy Crisis hit in 1979. Because President Carter decided the best way to deal with shortages was to ration gasoline, people postponed travel, so my business was devastated. Then the Iranian Hostage Crisis happened. The interest rate on my business loan jumped to nearly 20%, and when I failed to make a payment, the lender called the loan. The US economy and my career went into a tailspin.
My dream to be a business owner was over. But here's The Rub: Though the first part of my dream was erased, the part about becoming a San Diegan was not. I was living in Paradise and I wasn't going to be leaving anytime soon.
H O Sports
Out of the blue I got a call from a guy named Herb O'Brien, the founder of the iconic O'Brien Waterski Company and Rick Reulos' former employer. I was shocked because as Reulos had revealed to me, Herb had been convicted of drug smuggling and was sentenced to a 10-year term in federal prison in 1973.
While visiting Chile, to support his O'Brien Professional Ski Team participating in a world waterski championship event, Herb had stupidly been talked into stuffing skis and fake luggage bottoms with cocaine. Little did he know the supplier was actually undercover Chilean drug enforcement operatives who notified the Drug Enforcement Agency in the USA. As he departed the plane upon his return, he was arrested. That effectively ended his relationship with the O'Brien Company and Rick Reulos' job. The camping and sporting goods giant Coleman Industries purchased his O'Brien Company assets and copyrights during a forced liquidation auction.
As I spoke with Herb, he went on to tell me he had gained early release due to a ruling that he had been entrapped by the government prosecutors, and had already formed a new venture called HO Sports (he was no longer legally able to use his own name under the terms of his court settlement so he opted for his initials). He assured me that his old business partners, the dealers he had made rich while selling O'Brien skis, would be eager to get on board with him again.
He wanted to send me a sample of his new "revolutionary" product, so I could decide if I wanted to get involved. He said I had been highly recommended by Denny Kidder and Rick Reulos, and we could figure out terms that would be very flexible.
In a few days I received a slalom ski via FedEx. It was without a doubt the ugliest ski I had ever seen. It featured a graphic of a HOt dog (HO, get it?) slathered in mustard!
I wouldn't be able to sell this ridiculous thing. The ski was nice and the binding was magnificent! But the image of a yellow and orange ski with a hot dog graphic was childish.
I really didn't know what to think. I was not a professional skier, I didn't own a ski boat. In fact, I was skiing less than ever since I moved to San Diego because our group's old Fresno/Kings River location was just too far to drive. The Ski Outpost was never intended to be open during Summer months, so we would not be attracting water skiers. I was definitely in a transitional point in my life, but…?
I wasn't too excited about going back out on the road, and he didn't offer a company car. I was involved in a serious relationship with Cathy by then, so the appeal of spending days on the road and sleeping in motels was long gone. But I was flattered by Herb's interest and when I saw the revolutionary ski boot he had invented, I was sure he would be fabulously successful with his new line.
As long as somebody convinced him to change the graphics!
His new 'Waterski Boot' design was so simple, like all brilliant product innovations, you just had to wonder why no one else had ever thought of it. It made the boot fit better, it was more comfortable and it added a level of control that was clearly an advantage. And he had a patent on it.
He promised to fly me up to his home in Washington and show me the ski lake he built on his property. But first, he wanted to fly me to Houston to work in a booth at the National Boat Show at the Houston Astrodome. This would be a working interview and I would be paid for my time.
Needless to say I was overwhelmed. The man was super cool. He confided in me. He listened when I made suggestions about the graphics. He even adopted my suggestion for a moniker: The "HO Tournament One". We could abbreviate that as the HO T1 ( The Hot One!).
When I walked into the booth in Houston, guess what the skis looked like?
He introduced me to dozens of movers and shakers in the water ski industry. I was smitten. I didn't want to miss the boat on another O'Brien-type success story, so when he offered, I took the job.
I worked really hard for the next year and a half to introduce at least fifty prospects throughout California to the brand new HO Sports line of awesome skis and accessories. But it went nowhere for me. I wasn't Herb O'Brien, I didn't have his gravitas and I was going broke real fast.
In the fall of 1982 Herb called and I was expecting an invitation to visit his ranch in Washington. Instead, he flew down to LA, took me to lunch and delivered the news: He was going to go another direction. He just didn't want to string me along, because he was convinced the company could grow best by doing everything in-house. He was going to have to establish his credibility directly. He was, as usual, very intuitive.
As The Rub would have it, it hurt to watch HO Sports dominate the water ski market ever since. He not only duplicated his earlier success, he doubled down by pioneering the wakeboard. Once again, I had been so close to a wildfire I could feel the heat, but my timing was just a little off.
Two Mentors
After the Ski Outpost was liquidated and all of the legal entanglements were cleared up, and my relationship with HO Sports ended, I was in serious need of a job…no, a new career! I was determined to live in San Diego, I was engaged, and sharing the mortgage on Cathy's condo meant I had to make rent.
I attended the funeral of one of the Board of Directors of my Ski Outpost's Subchapter S Corporation. At the Celebration of Life, I was speaking with a dear friend of my brother who owned a custom cabinet shop in San Pedro. His company was one of the biggest suppliers to the tract home industry in Los Angeles. He asked me what I was planning to do "post Ski Outpost". Would I be interested in coming to work for Alexander Cabinet as a sales rep in the San Diego area?
"I don't know anything about making cabinets!"
"You are a natural salesman and I will teach everything else."
Over the next two years I learned the cabinet supply business at Alexander Cabinet. Cary Alexander took me under his wing as I took over for a seasoned vet who had had a career ending stroke. He threw me into the fire the very first day! He taught me how to read blueprints, how to assess job sites, understand project schedules and how to measure. He showed me how to create project proposals and what was necessary to locate and go after new business.
I was commuting to San Pedro a couple of days a week, and working on projects all over Southern California. I knew I was going to feel like a fish out of water for a long time. Going into the cabinet business was totally foreign. Growing up, I never once thought about kitchen cabinetry, or building new houses. But the ski industry was also going through a transformation, and I felt I had to go in a different direction if I wanted to stay in San Diego. And I did.
Here's The Rub: I knew it was time to abandon the ski business, and in San Diego, the industry with the most opportunity was new home construction. I really enjoyed being outside, engaging with superintendents and subcontractors who worked as a team to build beautiful homes. Working independently was scary but rewarding. It didn't take long for me to know this was my future. But I was a Nervous Nellie.
The very first contract I landed on my own, a 90 unit single family job in Rancho Bernardo, turned out to be one of the largest overall contracts ever awarded to Alexander, since Cary took over ownership from his dad. Because the homes were in the upscale Rancho Bernardo community, the average price per unit was record breaking, so the overall contract amount was huge.
During the fast paced ordering process for the under construction model homes, I rushed to submit my order, and everything went great. Our delivery was on time, and I was starting to relax when the phone rang and the superintendent demanded I come to the jobsite immediately.
We went into the first model and he pointed out that the wall cabinets were too short. Oh my God, I nearly had a stroke! Eventually we determined that I had been given an older set of plans, which didn't reflect a recent interior designer "Change Order". I showed him my set of plans and it was confirmed they were dated before the change. So the builder had to reorder all of the model home wall cabinets at their own expense. I had dodged a bullet that may well have murdered my new career right out of the starting gate.
Later, the Alexander Cabinet Company ran into serious union and financial issues, and decided to abandon the San Diego market, so Cary got me an interview at McConnell Cabinets (Norwalk, CA.) where I fine tuned my skills with mostly San Diego projects for the next two years. Sales Manager Mike McConnell was the son of one of the three founders. The company was triple the size of Alexander, and they already had a seasoned salesman in San Diego, but Mike was certain that the market could support a second one. He also took me under his wing and taught me a lot about the techniques involved in field work and contract negotiations.
The Rub? I was lucky to be mentored by two experts in the business of providing cabinetry to residential tract builders. It took only a few years to become very adept at the job. I made my share of mistakes, but I seldom repeated them. I was not looking for a career in homebuilding, but I fell into something quite suitable to my lifestyle.
The Whales
It turned out that my McConell experience opened another door for me. McConnell was still shipping unfinished cabinets, but a small number of builders were using "prefinished" cabinets. Home building is all about time: The builder uses loaned money, and if the project runs over the allotted time frame, the cost of the money jumps dramatically. In the project timeline, cabinet installation represents a major turning point, because only then can the finish trades (countertops and hardscapes, painting, fixtures, appliances and flooring) all come through. Skipping the cabinet finishing step sped up the job dramatically, and it usually provided a more luxurious furniture-like finish. It was clear to me that demand for 'prefinished cabinets' was going to grow exponentially.
I tried to test some of the other sales reps at McConnell to see what they thought about prefinished cabinets without exposing my concerns. I overheard one of the old timers say to another rep, "you know, if I were just starting out, I would probably want to hook up with a company that prefinished their cabinets. It just seems like the future."
I started to survey jobs with prefinished cabinets and discovered a company from Colorado was leading the way. I went into their office/showroom in San Diego and approached the manager. Within a month I was an employee of Mastercraft Industries Corporation, and was quick to convince a few of my old McConnell accounts to try us out. For the first time in my cabinet experience, I was working out of offices in San Diego. It was a luxurious showroom, and the staff was made up of young, local designers and the manager was relocated from Denver. He was anxious to establish the company in Southern California, so he dove into my efforts with enthusiasm. I felt really lucky to be with a Denver based company that was eager to expand into San Diego and Southern California. Their culture was excellent. The employees loved the management, and the product was very attractive.
But…
In 1985 Mastercraft got sold. Whirlpool Corporation was on an acquisition binge: They purchased Mastercraft, St. Charles Cabinetry (famous for building high-end products including very unique stainless steel cabinets), Roper and KitchenAid Appliances. They had a vision to open a series of kitchen design centers across the country where anyone, builder or individual, could utilize a new, still under development, 3D computer design system to create integrated kitchens and baths. Our San Diego showroom was selected to be a beta test center.
It was a very exciting time. I won a company contest to name the new interoffice newsletter. I suggested Whirlpool Kitchens Ink. Got my picture on the first page of the first edition.
I saw some tractors turning ground near the Carlsbad Lagoon, so I stopped the machine operator and got his business card. I was directed to the project manager and invited to his office. It was a magnificent highrise, and he and I hit it off. They were developing a multi use property that would feature a college as the centerpiece, surrounded by a variety of housing and retail projects. He was currently bidding out the first of several planned housing tracts, and he was eager to use high end cabinets and appliances in the kitchens. Mastercraft was just introducing a high-tech frameless cabinet line and it would be perfectly suited for his needs and KitchenAid was the preferred line at that time for modern, state-of-the-art appliances. And of course Whirlpool was golden, too.
I eventually signed a massive contract for a dozen $1M homes in the first phase of a 60 unit parcel. That first order alone billed at $258K for cabinets and kitchen appliances. It could eventually bill $1,290,000 for all 60 units once completed and was by far the largest contract I had ever landed.
Soon thereafter, a Whirlpool executive addressed the Mastercraft employees at a national meeting. During his speech, the newly appointed President of Cabinet Operations, begged us to "Bear with me, as I learn the cabinet business." He was an appliance man, and it soon became clear that the new owners had no clue what it took to run a cabinet operation.
Months later, when we started delivering cabinets to my big Carlsbad project, things went off the rails. The subcontracted delivery service workers thought they were handling appliances and damaged much of the load. Using newly installed computer systems, the factory orders were missing items and then the KitchenAid appliance orders suffered many delays and deficiencies. The builder immediately put the next phase out to bid and we weren't invited. What initially looked like a Game Changer for my cabinet career, turned into a Death Knell for Whirlpool Kitchens, Inc.
I was long gone when four years later Whirlpool dumped all of their cabinet operations. Mastercraft's original owners bought it back for pennies on the dollar.
The Rub? I was angry about losing the contract and some enormous commissions, but I soon realized Mastercraft/Whirlpool Kitchens was a pipe dream. The Carlsbad Lagoon project fell into bankruptcy and was eventually sold. The original development plans were tossed and the new owners downsized the homes and increased the commercial space. The college concept was abandoned altogether.
My Mastercraft future had been swallowed by a Whale.
Merillat Industries
In the Spring of 1986, I was contacted by a headhunter for Merillat Industries. After many phone interviews they flew me back to the home office and main manufacturing plant in Adrian, Michigan. It sits in the middle of old cow pastures and farms. Merillat was at the time the largest cabinet maker in the world. They were also the number one supplier to the national homebuilding industry, but had near zero market share in California. I went through a series of interviews with various department heads. It was an exhausting 24 hour whirlwind trip. I felt like I was interviewing for the FBI. I never expected to get the offer, but I must have impressed someone.
Soon I was a Merillat employee, and it felt like I had finally arrived in the business. But I was wrong. I was still a beginner when it came to dealing with large corporate hierarchies. Though Merillat was run by a family, it had layers of bureaucracy as did the catalog of corporate homebuilders they served.
Once I started meeting with local builder buyers, many of whom I already knew, I found most had no idea who or what 'Merillat' was. I had to tell them, "maybe you should familiarize yourself with the largest cabinet maker in the world!"
They were suspicious of out-of-state manufacturers, and wondered how the cabinets could survive great shipping distances. California is essentially its own country, so builders on the West Coast paid little attention to vendors from midwestern states. But the industry was changing quickly and every builder was looking for ways to reduce construction time and increase choices for consumers. Merillat was the leader in the new trend of prefinishing cabinets (as opposed to spraying stains on them after they were installed). They used a system that was identical to what automobile manufacturers used to paint cars. It electrically charged the paint molecules and the surface of the cabinet components to eliminate drips. The result was a superior appearance and increased production rates.
Owner Orville Merillat was, as I would say in my sales pitch, the Henry Ford of the cabinet industry. He innovated the idea of assembly line cabinet manufacturing. He invented and patented the self-closing hinge. He came up with the idea of building regional manufacturing plants near the needed resource to minimize shipping and handling costs. Each plant then shipped required components to regional assembly plants where the product would be built one-kitchen-at-a-time. As each kitchen collection reached the end of its assembly line it was immediately placed on a truck. Trailers were loaded with a sequence of kitchens and then delivered directly to the project.
My job, beyond finding and winning contracts, was to hire and manage a team of subcontracted field laborers who would meet the trucks, unload and stock the houses, and properly install the cabinets.
Merillat could deliver multiple kitchens with just one week lead-time. This allowed the builder to give pre-production home buyers options on cabinet finishes that no other vendor could offer. No one else in the industry could come close to the efficiency Merillat brought to the process. Local shops required at least 6-8 weeks lead time to meet production schedules. Our assembly plant in Las Vegas could fill a truckload of newly assembled cabinets, then ship and deliver them to San Diego the same day!
For the first time in my cabinet career, I could say I was not only an expert at what I did, but I had an employer that was the leader in the business.
But it was still a hard sell. Local builders are very conservative, and loyal. They had long term relationships with their cabinet suppliers, so it was hard to say "Adios amigo! We're getting a divorce!" Merillat was, on the surface, much more expensive than the locally manufactured custom cabinets. But they soon began to understand the price of delays, of finishing in the field, and inability to offer custom options to buyers, was offset by having the cabinets ordered, delivered and installed, ready for countertops, all inside of two weeks!
At one point, our Merillat shop in Las Vegas was producing 3,000 cabinets per day! I could legitimately promise builders to take their orders and deliver up to ten kitchens in just six business days. This meant, in many cases, they could put in cabinet color choices made by the new homeowner.
Most buyers simply didn't believe me.
When possible, I would invite buyers to visit our western regional assembly plant in Las Vegas. They would be amazed by how clean, efficient and productive it was. Compared to most of the local shops in Southern California, Merillat was over-the-top state-of-the-art. Local cabinet shops were dusty, noisy and crowded. The Merillat assembly plant in Las Vegas was so sterile you could eat off the floor.
One time, soon after Masco Corporation purchased Merillat (and Kraftmaid), I took several executives from one of So Cal's largest builders to tour a model home showcase in Las Vegas. The homes were outfitted with Masco-owned brand hardware (Baldwin), faucets (Delta), and windows (Milgard). We wanted to show off our newest line of high-end Amera cabinets.
The CEO of Baldwin Homes said their time was valuable so I would have to make it a quick trip. So we flew them in our private Merillat LearJet. They had time to tour our model homes, our plant, as well as a Del Webb Communities project, gamble for a couple of hours, and be home for dinner.
When Merillat was sold to Masco Corp., employees were elated because the new ownership had immense liquidity and leverage in the building business. But the administrative leadership changed and was dominated by book-educated, MBA 'Smart-Alecs' that had zero real world experience in the builder trades.
Suddenly, instead of quality and efficiency, the "bottom line'' became the driving force at Merillat Industries. Micro-managers pushed Zig Ziglar motivational rallies, and hired dozens of "Industry Leaders" to reinvent what was already working wonderfully.
Merillat became extremely dependent on the nation's largest builders, who constantly demanded lower prices, so thousands of loyal small builders got sent to the back of the bus. My area, South Orange County and San Diego, was dominated by local builders who relied on local cabinet shops and the personal service they could provide.
Big builders build huge developments and work in multiple states, so Merillat, with its five assembly plants strategically located in the fastest growing regions of the country, was uniquely suited to service their needs. Their huge dollar volume appeals to the corporate financial advisors, but when a recession hits, they shut down quickly, and then what do you do with plants that are designed to spit out boxes like vending machines?
I had a fair amount of success working directly for Merillat in San Diego, but the building industry is dependent on economic activity, and after a serious recession in 1991, a year where my sales were near zero, they asked me if I would relocate, and I refused, so they let me go.
The Rub? I was a veteran of the industry and had sold over $10M in cabinets, so I should land on my feet, right? All of my "experience" turned out to be an illusion. Whales devour whatever flotsam and jetsam that comes along. I had hoped to be a pilot fish, but the Masco Whale swam too deep, and I had to look elsewhere for survival.
Voice-Tel
During yet another So Cal building recession I was struggling to find a new career path. I hooked up with a company in San Diego called Voice-Tel. They were hiring account executives to sell small businesses telephone services, centered around a proprietary voice messaging system.
It was totally out of my realm of experience, except that many of my former cabinet clients were themselves small businesses, and I was familiar with getting past the gatekeepers to speak with the decision makers.
I took the job and commuted to Rose Canyon near Mission Bay (one block from my former Mastercraft showroom office). It was a small group of mostly younger people, (the owner, GM and two technical systems managers and two other sales reps). The GM was really attentive and took a lot of time to personally mentor me about the business.
My job was to find small businesses that had 20 or less employees, and who had employees that operated outside the office because they were the target for our service. They typically had issues with keeping their workforce in contact with each other and to respond to inquiries quickly. Because the business typically had outside sales or service employees, and in those days there were very few mobile phones, it was hard to be responsive and to make important work or schedule changes. The main form of contact was 'pagers' (a beeper device that transmitted a phone number to the user who would quickly find a landline or phone booth to call back). That was the state-of-the-art in the world of business communications at that time.
Voice-Tel based their system around direct inward dial (DID) voicemail. A unique phone number was assigned to each client, and they could record a message for all inward bound callers. The call would never be answered live. The idea was that if the client was part of a group of employees and they gave out business cards, the main office number would be given. But to avoid the cost of hiring a live operator/receptionist, calls would be directed to one of our DID (direct-inward-dial) menus, ("Please listen to the menu and then press the number of the person you need to speak to") and then the system would direct the call to any one of those other voicemail numbers.
When the caller left a message, the system would automatically dial their pager number and they would then call their assigned voicemail box, listen to the message and respond accordingly. If appropriate, the box owner could forward the message to another person on the system if they could better respond to the issue.
One of Voice-Tel's first and most prominent users was the iconic multi level marketing organization known as Amway. They used the system to keep thousands of independent agents focused on their recruiting designs by sending motivational messages to their downline groups every day. Agents handed out business cards with their VT phone number, and then that caller's message was directed to the appropriate agent to follow up.
During the two years I spent there, dozens of Amway wannabes flourished: Multi level marketers like Mary Kay Cosmetics developed product lines to replace store bought goods, or credit card-like products that offered discounts and commissions on gasoline, phone calls and vitamins. Voice-Tel reps saw those as potential gold mines because if they took off it would guarantee thousands of voicemail boxes and users all over the country.
I learned a lot from my time there…Voice-Tel sent me to a training session in Ohio. It was a five day class with new reps from various franchises around the country.
I was assigned a room with a guy from Phoenix. He was a young, articulate, obese man, with a wicked sense of humor. In fact, he never turned the 'Joker" switch off. While we were unpacking he asked me if I was OK with him "entertaining" friends in our room? It didn't register with me that he was referring to prostitutes, so I said, "Whatever, just so I can get some sleep when I want to go to bed."
As we filed into the conference room the next morning for orientation, in the absence of the Instructor, he grabbed the multiline speaker phone in the middle of the long conference table, dialed a number, and sat down. The group was made up of guys and gals of different ages. The next thing our class heard was a phone sex line graphically playing over the speakers!
The Instructor walked in and wasn't amused.
Long story short, this guy went on to ignore class assignments, undermine team projects, abuse females with sexually charged jokes and comments, waste corporate expense money, and do everything possible to get himself fired. I only found out later he had spent his per diem money on prostitutes he had "entertained" up in our room!
At the final night "Graduation Dinner" he quietly, and without authorization, ordered lobsters for everyone present.
When I walked into our San Diego office the following Monday, my GM called me into his office.
"What the hell happened there? We think we know, but tell us what you saw!"
As I listed the daily activities of this creep, they sat shaking their heads. They knew this was a setup. In the end, a series of lawsuits were filed against Voice-Tel! The perp claimed he was sexually humiliated because he was gay! After hundreds of thousands of dollars spent on investigations, it was discovered that this guy was a professional shakedown artist. He had successfully extorted money by way of 'courthouse steps' settlements with other companies, including AT&T!
The Rub? There is an underworld cartel of lawyers and bad actors that collude to extort money from businesses using the myriad of recently passed sexual and racial harassment laws.
Most of the cases never go to court because the deep pocket companies want to limit their exposure, so they settle out of court, regardless of the preponderance of evidence supporting their innocence.
Eventually Voice-Tel got bought by a large telecommunications company. In less than two years my role changed into a boiler room dial-for-dollars salesperson with little or no outside contact. It was time to move on again.
The North County Times
The building business in California has always been cyclical. Home building booms for 7 or 8 years, and then it tanks for a few. Some building recessions have been much longer, but typically the demand for homes in Southern California supersedes most economic slowdowns. So industry professionals hang around, and bridge the recessions and then get right back in the saddle as soon as the economy picks up steam.
In 1994 I wandered into the offices of the local newspaper, the Escondido Times-Advocate. I asked if they were hiring and they said, "wait here". In a few minutes I was taken into an office and introduced to the Classified Sales Manager. She was a stunning Irish redhead with a beautiful smile. We talked and I asked her if they had a Home Section, as I was experienced in new home neighborhoods and could be helpful in recruiting builder advertising. She said they were in the process of starting such a section and "when can you start?"
Suddenly I was thrust into a room with thirty desks and telemarketers. It was a noisy chaotic nightmare! I was given a computer program with phone lists of every builder, real estate agency, and home decorator in North San Diego county. I was directed to call them and encourage them to advertise in the paper. To sign a 13 week ad appearance contract and then to go to the art department to develop an ad for them.
I was directed to focus on real estate developers, agents and brokers.
It was nearly an impossible task because home builders already spent fortunes in advertising with the San Diego Union Tribune, which offered ten times the number of subscribers. And they spent millions on signage and point of purchase literature, on glossy ads in travel and real estate industry magazines, on radio and TV, and didn't need another print cost when the market was so slow.
A few weeks into my tenure, I went in and talked to the Sales Manager. I pleaded to get the New Homes section up and running as soon as possible. I had some ideas: Builders sell most of their new homes to locals, so what if we could do a cross promotion with a furniture chain to put up a drawing prize. Readers would fill out a coupon in the Home Section and submit it at a participating model home complex sales office. We would hold a drawing every 2 months and award a $5000 furniture shopping spree with an advertiser. We could offer special ad rates to attract both participants, and hold a news conference when the winners were announced! Builders get lookers, furniture stores get exposure, and we get advertising from all of the above plus some "ride alongs" that want new home buyers business, such as real estate agents, moving companies and landscapers.
The idea went over well and I was a hero for a while. Unfortunately, The TA distribution was very small and yet they charged similar rates to the Union Tribune, with millions of readers. Ad agencies are paid to discern these differences and our projected revenues never materialized.
But then a Big Whale came along. Howard Publications, a family owned company that ran 16 other newspapers around the country, decided to buy into the rapidly growing San Diego media market. They bought two local papers, the Escondido Times-Advocate, and the Oceanside based Blade-Citizen. Those papers were merged and The North County Times was born. Management changed, and I ended up right back in the classified sales department. The new owners simply abandoned the New Homes concept and settled for the traditional classified format for real estate ads.
I wasn't cut out to sell classified advertising. Especially in a loud atmosphere where I was, by far, the oldest guy in the room. I loved the idea of working in the media in a local capacity, but not taking orders for garage sale ads. The fact that Howard Publications was now running the smalltown newspaper was sad, because they, like all major corporate conglomerates, only focused on revenue.
I never reached the point that I had imagined: Tending to the larger builder ad agencies, going to lunch, participating in field promotional activities and eventually gaining a following of builder and real estate broker accounts. Instead, I was expected to tend the phones, write up redundant small time ads for agents and accept the fact that the Home Section was not viable competition for the San Diego Union Tribune.
The Rub? Little entrepreneurial businesses that become highly successful often get eaten by Whales. I started looking for a way out of the boiler room. If I was going to have to do dialing-for-dollar sales, I wanted to do it in the comfort of my own home.
Golf Southern California Magazine
I was still working at the North County Times when I picked up a free magazine at one of the local golf shops. It was a 14" X 11" newspaper tabloid format, with a variety of "news" stories. Most of the content was summaries of recent amateur and college golf and celebrity benefit tournaments, and advertorials about golf resorts around the western United States.
As I leafed through Golf Southern California Magazine, I noticed an ad by the publisher looking for an outside salesperson. I was growing disenchanted with the new management policies at the NCT, so I called the number.
I met with owner and publisher Bernie O'Brien (another O'Brien?) and we immediately hit it off. He suggested I keep my job at the newspaper, and do the magazine ad sales on my own time, evenings and weekends. I could do much of it by phone, and he claimed just making contact would result in a significant increase in advertising space sales.
The magazine was published 4 times a year, distributed to golf shops, driving ranges, sporting goods stores or any retail location that attracts golfers. It is offered free, and the entire contents were collated by the publisher. So I hoped there would also be some writing opportunities for me.
I accepted the terms (essentially all commission) and went directly to a public course very near my home on the following Monday afternoon. That call resulted in a one year contract worth $30K! I went home and told my wife I had found my new career! This was just too easy.
Not so quick…
It didn't take long for me to discover how unpopular the magazine actually was. Many of the golf course general managers resented the "discount" coupons most of our advertisers offered. They considered the newspaper tabloid format "cheap" and the absence of major golf manufacturers' advertising indicated brand name advertisers felt the same way.
I worked hard tracking down and contacting dozens of equipment manufacturers and their ad agency reps, only to be blocked. Too often uncollected magazines would stack up in the stores, exacerbating the issue of lack of readership. The truth was that the content was weak and focused too much on inside-baseball amateur tour stats. Advertising agents didn't see the value in our format or any way we could quantify our "free" distribution.
Every step of the way I was frustrated. My friends thought the magazine was boring and full of useless information. I was not making any money.
There were some positive impacts for me: I was given access to many top golf courses as a member of the print media. After PGA tournaments, the media was often invited to play a round of golf while the television equipment was removed and the course cleaned up after the crowds left trash all over the grounds, so I got free rounds at Riviera, La Costa, Sherwood Country Club and Torrey Pines, among others.
Hoping to increase readership, I convinced Bernie to let me contribute a column I called "The Driving Forces In Golf". I interviewed some of the icons of the San Diego golf scene, and did historical backstories on some local resorts and how they came about.
The Rub? It was like going to school. I wasn't making any money but I was meeting many golf industry icons and sharpening my writing skills.
Players Golf
As I circulated around the county trying to elicit ads from the various golf industry affiliates, I stumbled upon a company called Players Golf. I walked into an enormous facility in the industrial park in Poway. As I was trying to sell the GM on some advertising he asked me if I might be interested in joining their start up company.
"How so?" I asked.
"As a Regional Sales Manager. I would be setting up accounts in six states selling equipment to dealers on a direct basis."
"Can I see some of the equipment?"
He escorted me into an enormous, essentially empty warehouse in the back of the huge industrial building. There was a giant golf ball painting machine, spitting out balls with their logo on them. There were piles of boxes just being unpacked and we walked over to inspect some of the clubs they were shipping in from China.
It turns out Players Golf was owned by a Chinese manufacturing tycoon. He was making a fortune casting stainless steel club heads for domestic companies like Cobra, Arnold Palmer and Wilson Golf. His plan was to import his own unique line, using similar quality controls, and sell direct to shops at a much lower cost. To do this he had to have a stealth brand, because he would be competing with his own customers.
The Regional Account Manager's role is to set up on-course pro shops or smaller independent shop owners who either couldn't get the major brands because they were too near protected retailers or who wanted to increase their margins with an alternative discount line.
My thought process was this job could coexist with my job selling Golf Southern California magazine advertising, since that role was commission only, and I could devote as much time to it as I wanted. So why not give Players a shot? My first set of clubs as a beginner golfer was a "knock-off" brand called Cobra, which was a copycat of Ping, and look how successful that line became? The idea of a stealth product line was a proven concept.
I soon found myself back in a boiler room dialing for dollars again! Our bait was simple: Players will send the prospect some product on consignment. If they couldn't move it quickly just send it back, no obligation. I had no problem engaging golf pros at small town golf courses in conversation. I was getting one or two a day to put some product in their shop.
Every few weeks we would get a new product from China, and each time the designs were solid and the suggested retail prices were outstanding. We were getting state-of-the-art equipment, and we would get on the phone, and get our dealers to agree to take more on consignment.
Months were passing and most of the product was not moving. When it did and the buyers wanted more, we couldn't get delivery dates on shipments from China. There were always excuses, like "One of our trucks went off a cliff!" Or "The roads are closed due to snow!" For every one step forward, we took two steps backward.
Management wasn't too concerned about cash flow, and none of the salesmen were getting any overrides. We were slowly starving. The company encouraged us to keep trying and they kept promising more and better products, but the marketing plan was failing. The pros were neither selling the clubs or sending them back. They had no skin in the game.
Here's The Rub: It finally occurred to me that the Chinese Tycoon's domestic stealth golf company was really a con job. It was designed to fail. Players Golf was providing a tax haven for his enormous domestic income generated by his factories in China.
The entire sales staff was getting played.
Once again, I was confronted with a career choice. My golf industry experiences were turning out to be costly mistakes and I was wandering down what looked like a dead end cartpath.
Kitchens Plus
They had two showrooms, one on Miramar Road across from the Miramar Naval Air Station, and one in La Mesa. They resold major manufacturers' cabinets from a variety of suppliers. They did no custom cabinets or refacing. The showrooms were first rate and the product lines were some of the best companies. I really liked the Canadian owner and the GM was a young, ambitious but down-to-earth guy. He volunteered to mentor me because my job required a thorough knowledge of automated kitchen software design systems and suppliers catalogs, as I had to fit modular products to the space, using limited SKUs. It was going to take some time to become competent with a half dozen different manufacturers' product lines.
Working in a comfortable showroom was a welcome change. Occasionally going out to prospects residences to gather measurements and suggest design ideas was also refreshing. I enjoyed the challenge and the opportunity to apply my creative skills to design.
I was actually quite happy there, because the General Manager was really helpful and active. The products were good if you ordered them properly. But they were fairly expensive, so the closing rate was 1 in 10. That meant you had to go through the entire process (in-home interview and assessment: preliminary design; modifications and final proposal and design) nine times for free. All of which would take me at least 12 hours to complete, if everything went perfect and the customer agreed with everything. That seldom happened.
That means I would spend a minimum of 120 hours to win one contract. But many times it took much more than that since it was a new business to me. There were times when I was making $10 an hour! I was driving across town, and spending additional hours fighting drive-time traffic commuting on interstate 15. It was hours in the showroom, then many hours outside, often on weekends and nights.
One of my clients was a Systems Risk Analyst for a major international government contractor. They did huge risk analysis on billion dollar projects. As I sat down with him and his wife to get the sign off on their Rancho Santa Fe kitchen remodel project, he asked me if I was aware of my vulnerability to legal action over our workmanship. He suggested that since I was putting my signature on the contract I could be dragged into court and possibly held liable for faulty workmanship.
I said no, I was not the owner of the business, just a sales rep. He shook his head and said I should never put my name on legal documents unless I had to. I was shocked. I had never considered myself potentially liable for things that happened on my projects.
After that, in the back of my mind, I was very uncomfortable: I had witnessed one of our installers do something very questionable during the process of remodeling a kitchen. I did not report it or make note of it. The installer and I had agreed to do it because we thought it would be OK, and we just wanted to get the job done and move on. Were we to follow codes it would have required a major redesign, new permits and major delays.
The Rub? I decided it was time to find another job because I knew the boss was never going to allow me to keep my signature off of the contracts. Plus, I was constantly longing for work closer to home. And I just couldn't understand why that was so hard to find…
Wildcat Door Systems
Back in the late 80's when I was working directly for Merillat as the company area sales manager, one of the questions purchasing agents would invariably ask me was:
"Do you guys provide other wood products other than cabinets? We need recessed fluorescent light frames on the kitchen ceiling, and we want them to match the cabinets. Some of the local cabinet shops will do that for us. Can you?"
"No, we can't."
That put me in a competitive disadvantage, so I began looking for a local source.
I was measuring a new home in one of my Merillat projects when I ran into a young man on a ladder in the middle of the kitchen area. We started to chat and he revealed that he had a small business providing light frames and fireplace mantels. I explained my dilemma and we made a deal: If I needed to include either of those items in my proposals, he would simply do the work as a subcontractor. He promised he could make the finish match ours and everyone would get what they needed.
Rob eventually became one of my best friends. He and I worked on several projects together, but even more importantly, he was there for me when times weren't so good. At one point as the economy was recovering from another recession, we were discussing where the building industry was going and what new products might become "the next big thing". I said if I were going into the business all over again, I might think about the garage door business.
In California near the end of the 20th century, very few new homes were being built with metal roll up doors. In most markets outside of California, stamped metal sectional garage doors were the standard, but in California, because of the mild weather, builders stubbornly stuck to the much cheaper, but awkward and dangerous, plywood doors.
A few months later Rob called me up and said, "I've been thinking about what you said about the garage door business. I have done a ton of research, and I want to start a new division of my business. I am going into the garage door business and I think you would be a great sales manager. Are you interested?"
That was the genesis of Wildcat Door Systems. We came up with that name because we were like the wildcat oil drillers in Texas. We were drilling new ground, venturing into someone else's territory, and at that point, had no idea how we were going to do it.
I moved into his office space in his light frame and fireplace mantel manufacturing shop in Escondido. Within a year we had grabbed 6% of the entire San Diego garage door market. It started to grow exponentially. Eventually Rob added stamped metal Attic Access Door Frames to our repertoire. It was a clever frame to finish off those little attic crawl space openings typically in the hallway ceiling.
The overall per unit contract amount was commensurate with a cabinet contract but much less complicated.
Wildcat Door Systems was started on a hunch. It turned out to be a good one, but we weren't the only ones becoming aware of the growing metal garage door demand in Southern California. When we started the business, there were only a half dozen sectional door vendors in all of Southern California. In less than three years, that number had grown to forty!
And my name never appeared on any of the contracts!
Early in 1998, Rob walked into the office and said, "I'm done. I am going to wind down garage doors first. There is no way to make it profitable, and I can't go on doing so much of the field work myself. There has to be more to life than this!"
Rob was right, the product had become a common commodity and too many dealers were willing to lose money just to win a contract. As with most every aspect of the home building business, big national industry whales were swallowing up little independent contractors. Margins were almost nonexistent, and there was no loyalty amongst builders under pressure to manage price inflation as supply was constantly being limited by environmental regulations and anti-builder public sentiment.
The Rub? Only sharks can swim with whales. Pesky little fish eventually get eaten. It was shocking how fast things can change, and that was the lesson of the day. Rapid cultural and business change would prove to be the ongoing theme of the 21st century, and the story of my life.
Major Lines of California
My job at Wildcat Door was soon to be extinct. Rob didn't need a sales manager to run his super simplified mantel and access door business. It was inevitable I needed to move on. I was working in the field on one of our projects up in the hills above La Costa lagoon, in Carlsbad. We were doing the garage doors, but I snuck inside to see what cabinets they had used on this very high end custom home. There was a brand name on the hinges: it said 'Montalco'. Never heard of them, so I looked it up on the internet. The website indicated they were Canadian, so I called the home office. They said they would have the local distributor contact me.
The next day I got a call. I was shocked at the irony! It was a former Merillat rep who I knew very well. He was now the GM at Major Lines of California (MLC), who was one of the Orange County warehouse distributors I had serviced during my previous term at Merillat. They were the authorized regional distributor for Montalco Cabinets, made in British Columbia.
"Come see me, I have an opportunity you might like!"
In just a few weeks I was commuting to Anaheim and working for MLC. They had just acquired a large contract for Montalco Cabinets for a golf course community just a few blocks from my house in Escondido. I would be the lead contact to service the project which would take a couple of years to complete. Plus, I could sell and service other projects as they came along.
Major Lines also sold Merillat, along with several other consumer driven lines, but Montalco was their lead line, aimed at builders who increasingly wanted the "Euro" look. It was an excellent product at a competitive price, though it faced some challenges because of the shipping distance. The rep that had sold the contract had moved out of state, so I would collect his commissions as the loads were installed. I just had to measure each new house and make necessary changes before faxing the order to Montalco's factory in Richmond, British Columbia.
It was a good fit, but I found myself commuting at least three or four days a week to the Anaheim office and to service some projects I won in south Orange County. Most of the jobs went smoothly, and fast. But I was running to keep up, measuring framing, collecting scheduling updates, correcting orders for variations and change orders, and meeting truck drivers to direct unloading. Then meeting with installation crew managers to make sure they were keeping ahead of schedule. I typically had three different jobs going at any one time.
A few years later I was burned out.
The Rub? My boss left soon after I came aboard. He decided to move up north after an ugly divorce, so I felt somewhat abandoned. I was continuously feeling pressured to work more in Orange County because the logistics of installation in San Diego was causing MLC to suffer low margins. I knew I had to cut the umbilical cord to LA and Orange County. I had to find permanent employment in San Diego.
Schmid Building Supplies
The ad said they were looking for someone familiar with Merillat brand cabinets. "New Division: Great Opportunity!" The home office was in Poway, just 15 miles south of Escondido. The GM met with me and I was sure I would get an offer. I did, and I started right away.
The Schmid job offer couldn't have come at a better time.
The salary was decent and my job was to help Schmid Building Supplies, a newly acquired subsidiary of Masco Corporation (yes, the same one that had let me go just a decade earlier) to grow their new cabinet supply division. Schmid Building Supplies also provided fireplaces and fiberglass insulation, so adding cabinets seemed like a good fit to keep expanding Schmid's presence on construction sites. They already had the warehousing, the delivery trucks, and a labor force, and I had an established connection with many of Merillats corporate employees. Schmid had a great reputation and offered customers unified billing and single source help for issues that came up during construction.
What could possibly go wrong?
Masco management handed Schmid a big Merillat cabinet account with Pulte Corporation, which at the time was the No. 1 homebuilder in America. They had acquired a local builder and their properties in San Diego, so they now had several hundred new homes on schedule for the San Diego area. Another Schmid salesperson was given the job of babysitting that ongoing established account, so I was hired to find new Merillat customers and to help build a newly established self supporting cabinet installation and service division.
After a slow start I was introduced to a young man who was converting apartments into condos. He told me later he gathered up as many credit cards as he could get his hands on and maxed them out to acquire the apartments. Then he would bring in a few investors and within as little as 90 days, renovate and flip the units for enormous markups. His market was first time buyers which was an enormous demographic, so the market for his product was hot!
He said he had made $3M in just the past 18 months. A loophole in title law allowed the previously rented apartments to be re-entitled as new property after an ownership change, even though the wiring and much of the structure was not new. There was a huge inventory of 'for sale' apartment complexes because thousands had been built in the 60's and the owners were now ready to cash out their amortized properties before they had to invest their profits back into renovations.
As an authorized Merillat distributor and a recently acquired subsidiary of Masco Corporation, Schmid Building Supplies could offer these "flippers" extremely fast turnaround times, so I had a competitive advantage, and I could offer a variety of finishes so each condo appeared to be custom built. For flippers, time is critical and in short supply. We offered them quick turnaround and reasonable pricing on prefinished cabinets.
Over the next few years I won contracts from a number of these "flippers" amounting to thousands of units a year. I was a hero! But all was not well…our system for ordering, cross docking and installing the cabinets was never efficient. Oh, and to make it exciting, all Masco businesses were required to join a new computer system called Oracle. It was supposed to tie them all together, homogenize their language and increase efficiency exponentially!
Where have I heard that before? The transformation was a colossal mess.
Plus, my customers were walking a legal and financial tightrope. They were rogue entrepreneurs, most with little construction experience, and they were wards of their lenders. And worse yet, they were getting sued left and right for construction defects.
Schmid was a union shop, so they would always promote from within. Many of their "cabinet" installers came from other trades and were not experienced in the cabinet arena. More experienced installers preferred to work independently and could make much better money. So word spread quickly that the Schmid cabinet division was unreliable.
The Masco corporate office in Michigan was getting negative feedback from some of their major builder accounts in Southern California and the pressure to fix our cabinet division problems and expand our sales got turned way up.
As we ran smack into the 2008 Great Recession they shifted me into a new role: Servicing retail stores from Santa Barbara to the Mexican Border under the newly created business identity of Masco Retail Services Group. Most of the few existing accounts were mom and pop businesses and most were devastated by the downturn. But, getting away from the problems with the builder division was a relief, or so I thought. I looked forward to being out on the road again, setting my own schedules, and coaching my customers in sales and design. I had an enormous territory, so I spent one or two nights a week away from home.
It turned out to be the darkest and most depressing period in my professional career. In the span of just over a year, I watched 70% of my retail accounts go bankrupt. Our retail division was stillborn. I had personal relationships with retail business owners, so watching them get crushed was horrible. As the effects of the Great Recession wore on, the builder business was tanking too. Masco immediately started downsizing, and California, which had seen exponential growth, was bleeding cash.
I knew the end was near when in late 2009 they asked me to do a survey of my territory, and to avoid any mention of the companies decision to merge all of their cabinet businesses into a new corporate entity to be called Masco Cabinetry. It was a business decision to cut costs, and "right size" for the economic downturn.
Recently the company played games with the truth. I was caught in the middle because I felt a sense of responsibility to help my customers be successful. How could I lie to them and still be a reliable business partner?
I was going home at night feeling dirty. I felt like I was being used to perpetuate a lie. As my retail accounts were struggling to survive, our recently relocated production facilities were struggling to produce and deliver a quality product. I spent most of my time visiting dealer projects that wanted answers: Why was the product so inconsistent? Who was responsible for fixing, replacing and servicing goods that came out of the box damaged? When was the litany of problems going to be resolved?
Being a manufacturer's representative demands that I do what is in the best interest of the company. I get that. They pay me to present the best possible image to the marketplace. I am, over and above all, an order taker. As a sales representative I am supposed to attract, recruit and service new and existing clients. I have no problem with embellishing the truth. That is what is called sales. But that is different from avoiding or inventing the truth.
One of the fundamental rules of outside sales, a rule I was taught in the very beginning of my journey, is that I would get 80% of my sales from 20% of my customers. It would behoove me to identify and coddle that group. If I could take care of them, they would take care of me. I found that cliche to be 100% accurate. I didn't entirely ignore the 80% that were less productive, but I made herculean efforts to provide outstanding service to that 20%. When things went wrong, those dealers would look the other way. They wanted to believe me. They wanted me to be successful because we liked each other and we had each other's back.
I looked at it as a partnership. We all make mistakes, the secret is to work together to overcome obstacles, to resolve issues, and to make money. So trust is imperative. At least in my view, I have a hard time sharing responsibilities with people I don't trust. I honestly trusted my clients more than I trusted the management of Masco Builder Services and our Masco Retail Services division.
My District Manager, who I believed was a good, hard working, and serious individual, was 'owned'. He consistently ignored my customers' problems, assumed they were liars, and scolded me if I defended them. Even when it was obvious they had legitimate issues with what we were shipping them, my boss always sided with corporate.
"Find a way to avoid any expenses. The Company will not assume any liability. Period."
But we do have an obligation to deliver on our promises, right? If the end user believes they have been deceived, rightly or wrongly, don't we have a role in that perception, especially when what they are unhappy about is the condition of our cabinets when they are unboxed upon arrival?
At some point the customers won't tolerate excuses: They paid for a fine piece of furniture and too often it is arriving defective or damaged.
The company insisted I improve my lying skills in order to retain clients that were losing faith in our product. They offered advanced training in manufacturing fairy tales about why they should not be held accountable for product shortcomings, shipping damage or ordering errors.
They sent "Relationship Managers" to ride along with me, to monitor my approach and hoped their youthful enthusiasm, computer skills and willingness to embellish the truth would rub off on me.
After in-person meetings, some of my most trusted dealers would take me aside and commiserate with me, wondering how the company could possibly think their new line of rationalization was going to do any better than their last one.
Wouldn't it just be easier to fix the problems at the source rather than losing customers?
It was in the Summer of 2010 when I was 'Formally Released' by Masco Corporate. Our California building products division had racked up $130M in sales in 2007, but when they notified me they "were going in a different direction" the projections for 2010 end-of-year statewide sales would be only $28M. Masco Cabinetry, which was the new name for the merged cabinet assets, was going to have to stand on its own merits and Masco Builder and Retail Services Divisions of California were dissolved.
Here's The Rub: I just wasn't cut out to be a corporate guy. Big impersonal corporate operations require submissive role players, not individuals. Sadly, my fellow employees all knew the house of cards would eventually fall. We were like rabbits in a forest fire: Scrambling to find shelter. Some ran towards the fire, I ran away.
At one time Masco owned Merillat Industries, Quality Cabinet, Kraftmaid Cabinets, and a slew of cabinet distribution centers, as well as several factories in China that made component parts. Corporations have no tolerance for businesses that stumble and bleed profits. Ten years later, in 2020, Masco Corporation threw in the towel and sold off all of its cabinet assets to one of its competitors.
The conglomerate that I competed with, who owned a group of cabinet companies around the country, ended up buying Merillat, Kraftmaid and Quality Cabinet. They also own Cardell, Medallion, and MasterCraft too, among others. They make their mission to deliver their product in stellar condition, which was my main issue all along. With that said, they now dominate the retail cabinet industry.
The Rub? I started off with Merillat on a winning streak, with a state of the art cabinet maker who outperformed their competition. In the end, after the company was taken over by MBA-taught know-it-alls, I ended up without a job while they sold the company to people who did what I had been asking for all along.
China Syndrome
After my release from Masco Cabinetry/Masco Retail Services, I was really depressed. I had watched hundreds of customers/dealers, contractors and friends lose almost everything in the Great Recession. The California new home builder industry was a skeleton of what it had been in the 80's and 90's. The Great Recession, combined with dozens of new state and federal financial and environmental regulations made the environment for construction toxic.
It looked like I was going to have to start all over again, again. I was, at that point, 60 years old. My computer skills were quickly falling behind. My experience in new home construction had no place to be applied. I had spent the past two and a half years working retail relations, and none of that was going to help me now because the survivors were still struggling. The Chinese had invaded the marketplace, and the Big Box Stores were the last man standing in terms of domestic cabinet sales. I had worked with big box stores in the past and it is a hapless job.
I worked briefly for a Chinese manufacturer as an Account Manager on their one big customer, HD Direct (which is a spinoff of Home Depot. It is a direct channel for apartment and condo owners and contractors for supplies related to property management). That was a total clusterfu*k because I soon learned that Chinese business people have no qualms about lying. They have no shame. In fact, it is considered a normal and admirable "skill" to "out-lie" your customer. Neither I nor the buyers at HD Direct could rely on anything they said.
I had taken the job knowing it probably wouldn't last too long. I needed to reinvent myself and this wasn't going to lead to that. But I secretly hoped for a tour of their Chinese factories. If there was any chance I could get a free trip to China, I was going for it. But that promise turned out to be just another lie.
The Rub? I learned the hard way that Chinese business ethics are 180 degrees out of alignment with ours. And sadly, the Chinese were going to play a major role in the future of not only the cabinet business, but virtually every business in America.
Kitchen Barn
One of the assignments I had towards the end of my term with Masco was to survey every single independent retail cabinet store from Santa Barbara to the San Diego border. I had to submit a report on what I found out, so I can honestly say there were very few cabinet and kitchen design businesses I didn't know about.
A few months after my release, I cleaned out my garage and as I was dumping toxic chemicals (paint thinner, old paint, etc.) at the local waste facility in Ramona California, I decided to drive up and down Main Street. It is a quaint little community with a western motif, and Main Street is only 10 blocks long. Suddenly I see a store front sign "Kitchen Barn: Kitchen Design Center". I was shocked! I should have known about this place, so out of curiosity I turned into the parking lot and walked in.
It was a beautiful showroom. It had a gigantic island and a fully functional kitchen. It had cabinet, countertop and accessory displays. And, it had a camera system to capture cooking demonstrations to send over social media platforms.
I immediately engaged the owner, a nice man who described his vision. I told him I was caught by surprise because as a factory rep it was my job to know about his store, but I had no idea. I turned to walk out and he said, "Come back soon, we have a lot to talk about. I think you might be interested in hearing more."
A week later I went back and had lunch with Matt, and he offered me a sales position. I had not worked in months and was getting a little bored, so even though it was nearly an hour drive each way, we agreed I could work part-time. Of course, it was commission only, but if I were to believe his projections, I could make some money and contribute my industry knowledge. I had to learn a different computer cabinet and countertop design system, and the specifications of other accessory items that go into a new kitchen remodel. I can do that…
For about 18 months we had a lot of fun and I made some money. We attended sales conventions and vendor sponsored training seminars. He sponsored his son in the sport of midget race cars on dirt tracks and I enjoyed attending some of those at Barona Speedway in Lakeside California. We had a great relationship, and I was pulling for Kitchen Barn to develop into an established outlet for the area, which was destined to continue to grow.
But the long hours in the showroom with very few walk-ins made me restless. I wasn't making enough money to justify the time and travel expenses. I can only sit at a kitchen counter for so many hours of the day…the business had survived for four years but it wasn't gaining any momentum. It was supported primarily by Matt's longtime clientele he had acquired while with a different cabinet business, so he was doing quite well. I wasn't getting enough leads and despite massive social media presence, the walk-in numbers never improved. I felt like I was being used to babysit the store while Matt worked in the field and spent time helping his kids with their hobbies.
As much as I liked the atmosphere, it was obvious I was once again going to have to move on.
La Costa Patio & Spa
I had purchased a used spa from a local dealer. He takes some units in trade and refurbishes them, and he offered to haul my now 20 year old spa away for free. During one of my visits to buy chemicals he lamented he could not find reliable salespeople. I said "What about me?" He looked stunned, then asked if I was serious. Why not, I am an avid user, I have always said my spa is one of the best investments I ever made. I can relate, and I have extensive experience in showroom sales. The showroom was only 10 minutes from my home, so it appeared to be a win win.
I didn't need to make a lot of money because I would soon be collecting social security checks. Selling a $15K spa generates a $600 commission. With a small base, I thought I could easily hit my $13K SS earnings ceiling with just 2-3 sales a month.
But the owner was a jerk. He thought intimidation and insults was a viable training device, and the economy was still in recovery so we only got 3-4 walk-ins a week. After 6 months of suffering his demeaning comments about slow sales, long hours sitting around the warehouse waiting for customers, and having only earned $3500, I quit.
The Rub? I learned that I could save more money than I was making by just staying home and cutting expenses. At 65, that was becoming real attractive.
IDEL Designs
I saw an ad on CraigsList looking for a salesman with experience selling countertops, new cabinets, cabinet refacing and refinishing. I had done all of that over the years so I made an appointment to interview at the Escondido shop.
It turns out I had met the owner years ago at one of the local Home Remodeling shows and I remembered him because he reminded me of a character in the Rocky and Bullwinkle Show. Henry was a photocopy of Boris Badenov. He had been a fixture in the local kitchen remodeling business for 17 years. He instantly hired me with a generous commission plan paid upon presentation of a signed contract. He told me he guaranteed customer satisfaction and never asked for a deposit. The customer pays the entire contract upon completion and sign-off.
How could I say no? How could prospects say no? I could offer refinish, reface and replacement services. I could work out of my house. He offered a gasoline subsidy. He provided all the leads and I made my own appointments. Done!
I spent the majority of the next three years working part-time for IDEL Designs. The shop was a mess and undisciplined. No showroom, just a front office with cabinet doors and granite and quartz samples scattered randomly around. Henry was arrogant and aloof, but he genuinely wanted me to be successful, so we spent a great deal of time discussing tactics and field issues.
I had a good relationship with his chief designer and field operations manager. He had an impossible job, trying to schedule unreliable subcontractors and get people to show up. Most of them didn't speak English, so having Oscar, who was fluent in Spanish, was imperative. But communications were the weakness of the company, and the customers were the ones who paid the price for it.
One time, while working a local remodeling consumer show, someone noticed our promotional video-loop playing in our booth. He said, "That's my kitchen!" so I stopped the guy and asked him in a joking manner, to stand with me and give testimonials. He said, "Are you kidding? I would never do business with Henry again!"
That was the last straw. My simmering displeasure with the inconsistent quality of work and our inability to get repeat business was boiling over. "Boris" was a master salesman in his own mind. He used manipulative tactics to close sales and if that didn't work he gave the job away because he was the owner and he would "make it up" on the next guy, while I was given little leeway on pricing.
His workers were disrespectful and unreliable. He definitely made efforts to "fix" complaints, but many people just gave up complaining after making too many unanswered phone calls. I was told by the guy walking by that after he collected payment, Henry was never available when issues came up over poor workmanship.
Henry was making a lot of sales, but I wasn't. I was getting hurt by pricing that included my "generous" commission, while his pricing was whatever he needed it to be.
The Rub? I got tired of waiting for my paycheck to clear the bank, of getting phone calls from customers who felt disrespected by the installation crew, and running down leads in south San Diego county where the chances of closing my sales were much lower because we had to add crew travel costs into my bids.
I stuck it out when I wanted to just go home. But when Henry told me he was selling the business, I was done with cabinets and remodeling. Period.
In 2019, I retired for good.
***
-- The Silhouettes
Our career paths take many turns. Depending on what age you start working, the road can be very daunting. I was enthralled by driving my own car. It was a sign of independence and maturity. That obsession drove all of my work ethic. I started trying to earn money at a very young age, but it wasn't how much I made so much as it was that I had some when I needed it.
Odd Jobs, Inc.
When I was sixteen I bought my first car with $300 I had saved up doing chores and from birthday and Christmas gifts. It was a 1959 VW Bug I found parked in a vacant lot. It had weeds growing up through the open windows and the headliner was shredded. I spoke to the home owner and he said he "wasn't sure it ran."
I got some friends to help me roll it into the street to jump start it. It ran great! Later I realized it had no battery, so for the first few weeks, until I could collect some cash to buy a new battery, I had to jump start it everywhere I went. I would park it with the front right tire on the curb, so I could get it rolling, then jump inside and pop the clutch.
I started driving my friends to school, and we all needed money so I proposed a business. I called it "Odd Jobs Inc." We printed up flyers and business cards and posted them on shopping center bulletin boards. I fielded calls from people who needed simple chores done around their house. We would do house cleaning, yard work, move furniture, pickup trash or run errands. An old lady hired us to move her sofa from one side of the room to the other. I scheduled the work, delivered my workers, provided some tools, and brought them home. I charged $10 an hour: They split eight and I kept two. I have wondered sometimes what would have happened if I just kept that business forever?
Later I took a job washing dishes at a small Mexican restaurant in the Malaga Cove Plaza. I think I made $1.25 an hour, but it only cost me about $4 a month for gasoline.
Now I had "Dishwasher" on my resume which helped me later when I went to college. Since I had to live on campus my freshman year, it made sense to get a job in the cafeteria that served the dormitory. I ran the dishwashing machine and mopped the floors.
During Summer Break I worked in a gas station in the Malaga Cove Plaza. On my very first day there, I checked the oil in a newer Mercedes sedan. When I got the oil can open, I poured the oil into the radiator by mistake. The station owner had to rack the car and drain the radiator and oil, just in case. The car's owner wasn't too happy because it caused a two hour delay. I never made that mistake again…working in a gas station.
Ski Racquet
When I left for college my mom had decided to go back to work, so she took a job with a friend who had just opened a new ski/tennis shop in Torrance. She talked them into hiring me at Ski Racquet to work on skis, mount bindings, clean and restock rentals and just do odd jobs around the property. I squeezed in 15 hours a week during classes and more during holidays and semester breaks. In my second year I started commuting and worked 20 hours a week all during ski season.
Owner Ron Goodrich was a flamboyant entrepreneur. He had started several businesses, and was always running numbers. We would have lunch and he would tell me exactly how much the restaurant needed to operate profitably based on the estimated square feet of the store. If they served 500 meals, at X number per meal, with 3000 square feet, they could hire X number of employees and make X amount of profit. It was always all about math to him.
He was determined to expand his business and rapidly opened several new stores. It was apparent that he didn't consider me management material, so I moved on.
Ski-Surf Shop
Owner Dick Mobley was an anomaly: A very tall man, a respected surfboard shaper, he was known for his uncanny ability to spot social and cultural trends and business opportunities. Once he decided to focus on the snow ski business, he smartly bought an old house on a main boulevard, and went headlong into the business. His wife Carlene was a talented business manager and bookkeeper. She managed the Ski-Surf Shop finances while Dick controlled the retail end. He realized early on that he couldn't, and shouldn't, compete with the discount sporting goods chains like Big 5 Sporting Goods. He went after the more sophisticated and advanced skiers, offering the beginners advice, but focusing his equipment sales on the intermediate or advanced skier.
When I arrived in 1973, his business was just starting to explode. The shop needed to expand and Dick was receptive to my remodeling ideas. That was my first exposure to design and construction, and it was incredibly successful. We lopped off the roof and added a second floor equal to the first. We had to use an outdoor stairway due to some ancient code, but it actually added an element of "cool" to the already funky building. He expanded his clothing selection, occupying the entire upper floor.
My mom became his clothing buyer because she had proved, during her time at Ski Racquet, to have a great sense of color and design. Each year for the next four years, Mobley doubled his business, and the majority of that came from clothing sales.
I ran the boot department and it became my badge of honor. I learned about orthotics and how supporting the human foot properly relieved many of the painful aspects of snow skiing, and improved performance. I knew orthotics use would become more widespread, simply because the biomechanics of the human foot is so complicated, and most people suffer from collapsed insteps and flat feet. But I had no idea back then, just how huge the shoe insert business would grow to be.
The Rub? Dick Mobley gave me the incentive to try to build my own business. His enthusiasm, confidence and entrepreneurship rubbed off on me.
Stinger Honeycomb Water Skis
At some point I convinced Mobley to bring in water ski equipment during the summer months. That is what led me to encounter another transformational individual a few years later. Rick Reulos walked into the Ski-Surf Shop and wanted to talk to me about water skiing equipment.
He was a very young, well dressed and articulate guy. He had a bright smile and eventually told me a story I found hard to believe; He said he had made a lot of money as a young man when he hooked up with a guy that fabricated beautiful wood laminated slalom water skis and sold them along the shores of Lake Sammamish, in the state of Washington. That enterprise eventually became O'Brien Waterski Company, and Rick made a fortune as a regional salesman when the company went international and became the dominant manufacturer in the sport. He went on to tell me many untold things about the history of O'Brien and how everything had changed. More about that later…
About a month later he showed up at the ski shop again. He took me out to lunch and continued his story. He was a slick talker, a fancy dresser and pretty cocky. He was forming his own sales organization called Solar Sports, and wanted to have a young, aggressive and sociable guy to go out into the marketplace. He said he had watched how I handled customers and thought I might be a fit for his business. One of the engineers from O'Brien, Denny Kidder, had started a new ski line called Stinger Honeycomb Water Skis and it was quickly becoming successful. The O'Brien Company had recently been sold to a large outdoor sports and recreation company called Coleman Industries, and Rick and Denny were convinced that represented an opportunity for a young, high-tech oriented manufacturer to grab market share.
Denny was Stinger Skis manufacturer and Rick's Solar Sports was the Western Area Distributor.
If I was interested in repping Stinger skis, he said I could start out part-time and transition to full-time. He would provide me with a new van, and a small monthly salary, plus a small commission based on sales. It took me about ten seconds to say yes…
I had always envied many of the manufacturers reps because they seemed to have a great lifestyle. I was certain I could do the job.
A few weeks later he came to town with a Winnebago motorhome and we went on a five day sales training trip, which started with a shopping spree along Rodeo Drive in West Hollywood. He wanted to buy me some "appropriate" clothes.
As we walked along the storefronts, I noticed a woman walking towards us. She was with a female friend, and she simply commanded my attention. She had a mane of flowing blond wavy hair, and a wide, bright smile. She was twenty feet in front of us and I was immediately transfixed. As we were about to pass each other, I diverted my stare so as to not embarrass myself. As we passed, I swear I could feel the heat from her aura.
Rick and I both turned to watch as she walked away. Rick said, "Not bad, huh? That was Farrah Fawcett!"
At that very moment I realized I had made a Game Changer decision about my future. I had spent many years working in retail stores owned by someone else. While I was manning the store, the owners were traveling and living the good life, and I knew it was time for me to move on. In college I had a poster of Farrah Fawcett hanging in my bedroom. She represented a certain image of youthful vitality, sexual freedom and happiness. Her energy was undeniable. That moment, when I saw her walk past me, left an indelible imprint on my psyche.
It was serendipitous!
I can't say I actually encountered her other than to brush by her on Rodeo Drive, but the fact that our paths crossed just when I was being courted by an exciting new employer, and had broken up with my longtime girlfriend, and wanted to reinvent myself, all seemed to be telling me I was going to be OK.
Rick and I spent a week driving up and down California in his Winnebago. He coached me on the finer points of searching for prospects:
"As you pull into small towns, go to the nearest phone booth and tear out the yellow pages under 'Sporting Goods' or 'Boat Dealers' and start calling them all to make appointments; Never underestimate the opportunities of dealers; Some of the biggest water ski dealers have shabby stores and frontages; Look successful and always be on-time; Make three or four appointments a day before moving on to the next to town".
A few weeks later Rick sent me to a Manhattan Beach Chevy dealer to pick up my new 1976 powder blue shorty panel van. I was responsible for outfitting the insides to carry and display Stinger Honeycomb Waterskis, Pro-Line ropes, vests, gloves and Knee Ski knee boards. I felt elated that I was officially an outside sales rep!
The Rub? The experiences I had traveling all over meeting with active business owners and buyers, finding my way around in foreign territory, sleeping in cheap motels and understanding the challenges of small business owners, was nothing less than a Masters Degree in Self Sufficiency and Outside Sales. As was my history, I passed the course, but I probably got a B-. I didn't make a fortune, in fact I was living paycheck to paycheck.
Ski Outpost
In 1977 I left LA, my parents and many of my LA based friends behind and started a new snow ski shop in Rancho Bernardo, a retirement-oriented community just 12 miles north and east of San Diego. I named it Ski Outpost. I decided it was time to turn the corner, become a San Diegan, and devote myself to the ski industry. I hung on to my Stinger job for a few months, but soon had to let that go.
I called my shop Ski Outpost because at that point in time Rancho Bernardo was just becoming a suburb of San Diego. It was technically the very first "Planned Community" so called because it wasn't just one housing tract. It was a series of communities built around a golf course resort, and it incorporated shopping centers, emergency facilities, schools and parks. My brother and I had identified it as a wealthy enclave of mostly upper-middle class newly or about-to-be retirees, but it was undeniably on the outskirts of greater San Diego. Its residents maintained the third highest average daily savings account balances in all of California. Located on the I-15 corridor, it was just the beginning of a housing boom that would eventually string Orange, Riverside and San Diego County together with new communities.
Remember earlier I referred to my dad introducing me to the concept of 'equity sharing'? Back when I was very young and wanted to tear up a corner of my childhood home's backyard in Altadena? Now I was able to buy a condo in Escondido because two and a half years earlier my dad suggested I invest in his rental condo to build enough savings so I could eventually buy my own place.
The plan was, since I had a van provided by Rick Reulos, I could sell my 1970 Chevy Camaro and he would take that cash as a ⅓ share in his rental property. I would occupy it as a renter, but when I moved out or he/we decided to sell, I would share ⅓ of the equity improvement. Thirty months later, when I wanted to move down south, our condo had appreciated by almost 50%, so he bought me out and I moved to Escondido. I used the cash on the down payment for my condo in a much more affordable real estate market.
It is a process called Equity Sharing. It was a brilliant tactic to get me involved in real estate investments so I could stop paying someone else's mortgage. It proved to be one of the most important financial lessons I ever learned, and it started with my childhood desire to build a miniature Disneyland in my parents backyard.
My brother and I began planning the Ski Outpost in 1976. He had the connections to get a small, unsecured, business loan, and to negotiate the lease for the commercial space. We opened the store in the Fall of 1977, and California was suffering a drought that year. Almost no snow except man-made snow in the local mountains. We lost money that year.
After a good snow year in 1978, and the Ski Outpost had a break-even year, the Energy Crisis hit in 1979. Because President Carter decided the best way to deal with shortages was to ration gasoline, people postponed travel, so my business was devastated. Then the Iranian Hostage Crisis happened. The interest rate on my business loan jumped to nearly 20%, and when I failed to make a payment, the lender called the loan. The US economy and my career went into a tailspin.
My dream to be a business owner was over. But here's The Rub: Though the first part of my dream was erased, the part about becoming a San Diegan was not. I was living in Paradise and I wasn't going to be leaving anytime soon.
H O Sports
Out of the blue I got a call from a guy named Herb O'Brien, the founder of the iconic O'Brien Waterski Company and Rick Reulos' former employer. I was shocked because as Reulos had revealed to me, Herb had been convicted of drug smuggling and was sentenced to a 10-year term in federal prison in 1973.
While visiting Chile, to support his O'Brien Professional Ski Team participating in a world waterski championship event, Herb had stupidly been talked into stuffing skis and fake luggage bottoms with cocaine. Little did he know the supplier was actually undercover Chilean drug enforcement operatives who notified the Drug Enforcement Agency in the USA. As he departed the plane upon his return, he was arrested. That effectively ended his relationship with the O'Brien Company and Rick Reulos' job. The camping and sporting goods giant Coleman Industries purchased his O'Brien Company assets and copyrights during a forced liquidation auction.
As I spoke with Herb, he went on to tell me he had gained early release due to a ruling that he had been entrapped by the government prosecutors, and had already formed a new venture called HO Sports (he was no longer legally able to use his own name under the terms of his court settlement so he opted for his initials). He assured me that his old business partners, the dealers he had made rich while selling O'Brien skis, would be eager to get on board with him again.
He wanted to send me a sample of his new "revolutionary" product, so I could decide if I wanted to get involved. He said I had been highly recommended by Denny Kidder and Rick Reulos, and we could figure out terms that would be very flexible.
In a few days I received a slalom ski via FedEx. It was without a doubt the ugliest ski I had ever seen. It featured a graphic of a HOt dog (HO, get it?) slathered in mustard!
I wouldn't be able to sell this ridiculous thing. The ski was nice and the binding was magnificent! But the image of a yellow and orange ski with a hot dog graphic was childish.
I really didn't know what to think. I was not a professional skier, I didn't own a ski boat. In fact, I was skiing less than ever since I moved to San Diego because our group's old Fresno/Kings River location was just too far to drive. The Ski Outpost was never intended to be open during Summer months, so we would not be attracting water skiers. I was definitely in a transitional point in my life, but…?
I wasn't too excited about going back out on the road, and he didn't offer a company car. I was involved in a serious relationship with Cathy by then, so the appeal of spending days on the road and sleeping in motels was long gone. But I was flattered by Herb's interest and when I saw the revolutionary ski boot he had invented, I was sure he would be fabulously successful with his new line.
As long as somebody convinced him to change the graphics!
His new 'Waterski Boot' design was so simple, like all brilliant product innovations, you just had to wonder why no one else had ever thought of it. It made the boot fit better, it was more comfortable and it added a level of control that was clearly an advantage. And he had a patent on it.
He promised to fly me up to his home in Washington and show me the ski lake he built on his property. But first, he wanted to fly me to Houston to work in a booth at the National Boat Show at the Houston Astrodome. This would be a working interview and I would be paid for my time.
Needless to say I was overwhelmed. The man was super cool. He confided in me. He listened when I made suggestions about the graphics. He even adopted my suggestion for a moniker: The "HO Tournament One". We could abbreviate that as the HO T1 ( The Hot One!).
When I walked into the booth in Houston, guess what the skis looked like?
He introduced me to dozens of movers and shakers in the water ski industry. I was smitten. I didn't want to miss the boat on another O'Brien-type success story, so when he offered, I took the job.
I worked really hard for the next year and a half to introduce at least fifty prospects throughout California to the brand new HO Sports line of awesome skis and accessories. But it went nowhere for me. I wasn't Herb O'Brien, I didn't have his gravitas and I was going broke real fast.
In the fall of 1982 Herb called and I was expecting an invitation to visit his ranch in Washington. Instead, he flew down to LA, took me to lunch and delivered the news: He was going to go another direction. He just didn't want to string me along, because he was convinced the company could grow best by doing everything in-house. He was going to have to establish his credibility directly. He was, as usual, very intuitive.
As The Rub would have it, it hurt to watch HO Sports dominate the water ski market ever since. He not only duplicated his earlier success, he doubled down by pioneering the wakeboard. Once again, I had been so close to a wildfire I could feel the heat, but my timing was just a little off.
Two Mentors
After the Ski Outpost was liquidated and all of the legal entanglements were cleared up, and my relationship with HO Sports ended, I was in serious need of a job…no, a new career! I was determined to live in San Diego, I was engaged, and sharing the mortgage on Cathy's condo meant I had to make rent.
I attended the funeral of one of the Board of Directors of my Ski Outpost's Subchapter S Corporation. At the Celebration of Life, I was speaking with a dear friend of my brother who owned a custom cabinet shop in San Pedro. His company was one of the biggest suppliers to the tract home industry in Los Angeles. He asked me what I was planning to do "post Ski Outpost". Would I be interested in coming to work for Alexander Cabinet as a sales rep in the San Diego area?
"I don't know anything about making cabinets!"
"You are a natural salesman and I will teach everything else."
Over the next two years I learned the cabinet supply business at Alexander Cabinet. Cary Alexander took me under his wing as I took over for a seasoned vet who had had a career ending stroke. He threw me into the fire the very first day! He taught me how to read blueprints, how to assess job sites, understand project schedules and how to measure. He showed me how to create project proposals and what was necessary to locate and go after new business.
I was commuting to San Pedro a couple of days a week, and working on projects all over Southern California. I knew I was going to feel like a fish out of water for a long time. Going into the cabinet business was totally foreign. Growing up, I never once thought about kitchen cabinetry, or building new houses. But the ski industry was also going through a transformation, and I felt I had to go in a different direction if I wanted to stay in San Diego. And I did.
Here's The Rub: I knew it was time to abandon the ski business, and in San Diego, the industry with the most opportunity was new home construction. I really enjoyed being outside, engaging with superintendents and subcontractors who worked as a team to build beautiful homes. Working independently was scary but rewarding. It didn't take long for me to know this was my future. But I was a Nervous Nellie.
The very first contract I landed on my own, a 90 unit single family job in Rancho Bernardo, turned out to be one of the largest overall contracts ever awarded to Alexander, since Cary took over ownership from his dad. Because the homes were in the upscale Rancho Bernardo community, the average price per unit was record breaking, so the overall contract amount was huge.
During the fast paced ordering process for the under construction model homes, I rushed to submit my order, and everything went great. Our delivery was on time, and I was starting to relax when the phone rang and the superintendent demanded I come to the jobsite immediately.
We went into the first model and he pointed out that the wall cabinets were too short. Oh my God, I nearly had a stroke! Eventually we determined that I had been given an older set of plans, which didn't reflect a recent interior designer "Change Order". I showed him my set of plans and it was confirmed they were dated before the change. So the builder had to reorder all of the model home wall cabinets at their own expense. I had dodged a bullet that may well have murdered my new career right out of the starting gate.
Later, the Alexander Cabinet Company ran into serious union and financial issues, and decided to abandon the San Diego market, so Cary got me an interview at McConnell Cabinets (Norwalk, CA.) where I fine tuned my skills with mostly San Diego projects for the next two years. Sales Manager Mike McConnell was the son of one of the three founders. The company was triple the size of Alexander, and they already had a seasoned salesman in San Diego, but Mike was certain that the market could support a second one. He also took me under his wing and taught me a lot about the techniques involved in field work and contract negotiations.
The Rub? I was lucky to be mentored by two experts in the business of providing cabinetry to residential tract builders. It took only a few years to become very adept at the job. I made my share of mistakes, but I seldom repeated them. I was not looking for a career in homebuilding, but I fell into something quite suitable to my lifestyle.
The Whales
It turned out that my McConell experience opened another door for me. McConnell was still shipping unfinished cabinets, but a small number of builders were using "prefinished" cabinets. Home building is all about time: The builder uses loaned money, and if the project runs over the allotted time frame, the cost of the money jumps dramatically. In the project timeline, cabinet installation represents a major turning point, because only then can the finish trades (countertops and hardscapes, painting, fixtures, appliances and flooring) all come through. Skipping the cabinet finishing step sped up the job dramatically, and it usually provided a more luxurious furniture-like finish. It was clear to me that demand for 'prefinished cabinets' was going to grow exponentially.
I tried to test some of the other sales reps at McConnell to see what they thought about prefinished cabinets without exposing my concerns. I overheard one of the old timers say to another rep, "you know, if I were just starting out, I would probably want to hook up with a company that prefinished their cabinets. It just seems like the future."
I started to survey jobs with prefinished cabinets and discovered a company from Colorado was leading the way. I went into their office/showroom in San Diego and approached the manager. Within a month I was an employee of Mastercraft Industries Corporation, and was quick to convince a few of my old McConnell accounts to try us out. For the first time in my cabinet experience, I was working out of offices in San Diego. It was a luxurious showroom, and the staff was made up of young, local designers and the manager was relocated from Denver. He was anxious to establish the company in Southern California, so he dove into my efforts with enthusiasm. I felt really lucky to be with a Denver based company that was eager to expand into San Diego and Southern California. Their culture was excellent. The employees loved the management, and the product was very attractive.
But…
In 1985 Mastercraft got sold. Whirlpool Corporation was on an acquisition binge: They purchased Mastercraft, St. Charles Cabinetry (famous for building high-end products including very unique stainless steel cabinets), Roper and KitchenAid Appliances. They had a vision to open a series of kitchen design centers across the country where anyone, builder or individual, could utilize a new, still under development, 3D computer design system to create integrated kitchens and baths. Our San Diego showroom was selected to be a beta test center.
It was a very exciting time. I won a company contest to name the new interoffice newsletter. I suggested Whirlpool Kitchens Ink. Got my picture on the first page of the first edition.
I saw some tractors turning ground near the Carlsbad Lagoon, so I stopped the machine operator and got his business card. I was directed to the project manager and invited to his office. It was a magnificent highrise, and he and I hit it off. They were developing a multi use property that would feature a college as the centerpiece, surrounded by a variety of housing and retail projects. He was currently bidding out the first of several planned housing tracts, and he was eager to use high end cabinets and appliances in the kitchens. Mastercraft was just introducing a high-tech frameless cabinet line and it would be perfectly suited for his needs and KitchenAid was the preferred line at that time for modern, state-of-the-art appliances. And of course Whirlpool was golden, too.
I eventually signed a massive contract for a dozen $1M homes in the first phase of a 60 unit parcel. That first order alone billed at $258K for cabinets and kitchen appliances. It could eventually bill $1,290,000 for all 60 units once completed and was by far the largest contract I had ever landed.
Soon thereafter, a Whirlpool executive addressed the Mastercraft employees at a national meeting. During his speech, the newly appointed President of Cabinet Operations, begged us to "Bear with me, as I learn the cabinet business." He was an appliance man, and it soon became clear that the new owners had no clue what it took to run a cabinet operation.
Months later, when we started delivering cabinets to my big Carlsbad project, things went off the rails. The subcontracted delivery service workers thought they were handling appliances and damaged much of the load. Using newly installed computer systems, the factory orders were missing items and then the KitchenAid appliance orders suffered many delays and deficiencies. The builder immediately put the next phase out to bid and we weren't invited. What initially looked like a Game Changer for my cabinet career, turned into a Death Knell for Whirlpool Kitchens, Inc.
I was long gone when four years later Whirlpool dumped all of their cabinet operations. Mastercraft's original owners bought it back for pennies on the dollar.
The Rub? I was angry about losing the contract and some enormous commissions, but I soon realized Mastercraft/Whirlpool Kitchens was a pipe dream. The Carlsbad Lagoon project fell into bankruptcy and was eventually sold. The original development plans were tossed and the new owners downsized the homes and increased the commercial space. The college concept was abandoned altogether.
My Mastercraft future had been swallowed by a Whale.
Merillat Industries
In the Spring of 1986, I was contacted by a headhunter for Merillat Industries. After many phone interviews they flew me back to the home office and main manufacturing plant in Adrian, Michigan. It sits in the middle of old cow pastures and farms. Merillat was at the time the largest cabinet maker in the world. They were also the number one supplier to the national homebuilding industry, but had near zero market share in California. I went through a series of interviews with various department heads. It was an exhausting 24 hour whirlwind trip. I felt like I was interviewing for the FBI. I never expected to get the offer, but I must have impressed someone.
Soon I was a Merillat employee, and it felt like I had finally arrived in the business. But I was wrong. I was still a beginner when it came to dealing with large corporate hierarchies. Though Merillat was run by a family, it had layers of bureaucracy as did the catalog of corporate homebuilders they served.
Once I started meeting with local builder buyers, many of whom I already knew, I found most had no idea who or what 'Merillat' was. I had to tell them, "maybe you should familiarize yourself with the largest cabinet maker in the world!"
They were suspicious of out-of-state manufacturers, and wondered how the cabinets could survive great shipping distances. California is essentially its own country, so builders on the West Coast paid little attention to vendors from midwestern states. But the industry was changing quickly and every builder was looking for ways to reduce construction time and increase choices for consumers. Merillat was the leader in the new trend of prefinishing cabinets (as opposed to spraying stains on them after they were installed). They used a system that was identical to what automobile manufacturers used to paint cars. It electrically charged the paint molecules and the surface of the cabinet components to eliminate drips. The result was a superior appearance and increased production rates.
Owner Orville Merillat was, as I would say in my sales pitch, the Henry Ford of the cabinet industry. He innovated the idea of assembly line cabinet manufacturing. He invented and patented the self-closing hinge. He came up with the idea of building regional manufacturing plants near the needed resource to minimize shipping and handling costs. Each plant then shipped required components to regional assembly plants where the product would be built one-kitchen-at-a-time. As each kitchen collection reached the end of its assembly line it was immediately placed on a truck. Trailers were loaded with a sequence of kitchens and then delivered directly to the project.
My job, beyond finding and winning contracts, was to hire and manage a team of subcontracted field laborers who would meet the trucks, unload and stock the houses, and properly install the cabinets.
Merillat could deliver multiple kitchens with just one week lead-time. This allowed the builder to give pre-production home buyers options on cabinet finishes that no other vendor could offer. No one else in the industry could come close to the efficiency Merillat brought to the process. Local shops required at least 6-8 weeks lead time to meet production schedules. Our assembly plant in Las Vegas could fill a truckload of newly assembled cabinets, then ship and deliver them to San Diego the same day!
For the first time in my cabinet career, I could say I was not only an expert at what I did, but I had an employer that was the leader in the business.
But it was still a hard sell. Local builders are very conservative, and loyal. They had long term relationships with their cabinet suppliers, so it was hard to say "Adios amigo! We're getting a divorce!" Merillat was, on the surface, much more expensive than the locally manufactured custom cabinets. But they soon began to understand the price of delays, of finishing in the field, and inability to offer custom options to buyers, was offset by having the cabinets ordered, delivered and installed, ready for countertops, all inside of two weeks!
At one point, our Merillat shop in Las Vegas was producing 3,000 cabinets per day! I could legitimately promise builders to take their orders and deliver up to ten kitchens in just six business days. This meant, in many cases, they could put in cabinet color choices made by the new homeowner.
Most buyers simply didn't believe me.
When possible, I would invite buyers to visit our western regional assembly plant in Las Vegas. They would be amazed by how clean, efficient and productive it was. Compared to most of the local shops in Southern California, Merillat was over-the-top state-of-the-art. Local cabinet shops were dusty, noisy and crowded. The Merillat assembly plant in Las Vegas was so sterile you could eat off the floor.
One time, soon after Masco Corporation purchased Merillat (and Kraftmaid), I took several executives from one of So Cal's largest builders to tour a model home showcase in Las Vegas. The homes were outfitted with Masco-owned brand hardware (Baldwin), faucets (Delta), and windows (Milgard). We wanted to show off our newest line of high-end Amera cabinets.
The CEO of Baldwin Homes said their time was valuable so I would have to make it a quick trip. So we flew them in our private Merillat LearJet. They had time to tour our model homes, our plant, as well as a Del Webb Communities project, gamble for a couple of hours, and be home for dinner.
When Merillat was sold to Masco Corp., employees were elated because the new ownership had immense liquidity and leverage in the building business. But the administrative leadership changed and was dominated by book-educated, MBA 'Smart-Alecs' that had zero real world experience in the builder trades.
Suddenly, instead of quality and efficiency, the "bottom line'' became the driving force at Merillat Industries. Micro-managers pushed Zig Ziglar motivational rallies, and hired dozens of "Industry Leaders" to reinvent what was already working wonderfully.
Merillat became extremely dependent on the nation's largest builders, who constantly demanded lower prices, so thousands of loyal small builders got sent to the back of the bus. My area, South Orange County and San Diego, was dominated by local builders who relied on local cabinet shops and the personal service they could provide.
Big builders build huge developments and work in multiple states, so Merillat, with its five assembly plants strategically located in the fastest growing regions of the country, was uniquely suited to service their needs. Their huge dollar volume appeals to the corporate financial advisors, but when a recession hits, they shut down quickly, and then what do you do with plants that are designed to spit out boxes like vending machines?
I had a fair amount of success working directly for Merillat in San Diego, but the building industry is dependent on economic activity, and after a serious recession in 1991, a year where my sales were near zero, they asked me if I would relocate, and I refused, so they let me go.
The Rub? I was a veteran of the industry and had sold over $10M in cabinets, so I should land on my feet, right? All of my "experience" turned out to be an illusion. Whales devour whatever flotsam and jetsam that comes along. I had hoped to be a pilot fish, but the Masco Whale swam too deep, and I had to look elsewhere for survival.
Voice-Tel
During yet another So Cal building recession I was struggling to find a new career path. I hooked up with a company in San Diego called Voice-Tel. They were hiring account executives to sell small businesses telephone services, centered around a proprietary voice messaging system.
It was totally out of my realm of experience, except that many of my former cabinet clients were themselves small businesses, and I was familiar with getting past the gatekeepers to speak with the decision makers.
I took the job and commuted to Rose Canyon near Mission Bay (one block from my former Mastercraft showroom office). It was a small group of mostly younger people, (the owner, GM and two technical systems managers and two other sales reps). The GM was really attentive and took a lot of time to personally mentor me about the business.
My job was to find small businesses that had 20 or less employees, and who had employees that operated outside the office because they were the target for our service. They typically had issues with keeping their workforce in contact with each other and to respond to inquiries quickly. Because the business typically had outside sales or service employees, and in those days there were very few mobile phones, it was hard to be responsive and to make important work or schedule changes. The main form of contact was 'pagers' (a beeper device that transmitted a phone number to the user who would quickly find a landline or phone booth to call back). That was the state-of-the-art in the world of business communications at that time.
Voice-Tel based their system around direct inward dial (DID) voicemail. A unique phone number was assigned to each client, and they could record a message for all inward bound callers. The call would never be answered live. The idea was that if the client was part of a group of employees and they gave out business cards, the main office number would be given. But to avoid the cost of hiring a live operator/receptionist, calls would be directed to one of our DID (direct-inward-dial) menus, ("Please listen to the menu and then press the number of the person you need to speak to") and then the system would direct the call to any one of those other voicemail numbers.
When the caller left a message, the system would automatically dial their pager number and they would then call their assigned voicemail box, listen to the message and respond accordingly. If appropriate, the box owner could forward the message to another person on the system if they could better respond to the issue.
One of Voice-Tel's first and most prominent users was the iconic multi level marketing organization known as Amway. They used the system to keep thousands of independent agents focused on their recruiting designs by sending motivational messages to their downline groups every day. Agents handed out business cards with their VT phone number, and then that caller's message was directed to the appropriate agent to follow up.
During the two years I spent there, dozens of Amway wannabes flourished: Multi level marketers like Mary Kay Cosmetics developed product lines to replace store bought goods, or credit card-like products that offered discounts and commissions on gasoline, phone calls and vitamins. Voice-Tel reps saw those as potential gold mines because if they took off it would guarantee thousands of voicemail boxes and users all over the country.
I learned a lot from my time there…Voice-Tel sent me to a training session in Ohio. It was a five day class with new reps from various franchises around the country.
I was assigned a room with a guy from Phoenix. He was a young, articulate, obese man, with a wicked sense of humor. In fact, he never turned the 'Joker" switch off. While we were unpacking he asked me if I was OK with him "entertaining" friends in our room? It didn't register with me that he was referring to prostitutes, so I said, "Whatever, just so I can get some sleep when I want to go to bed."
As we filed into the conference room the next morning for orientation, in the absence of the Instructor, he grabbed the multiline speaker phone in the middle of the long conference table, dialed a number, and sat down. The group was made up of guys and gals of different ages. The next thing our class heard was a phone sex line graphically playing over the speakers!
The Instructor walked in and wasn't amused.
Long story short, this guy went on to ignore class assignments, undermine team projects, abuse females with sexually charged jokes and comments, waste corporate expense money, and do everything possible to get himself fired. I only found out later he had spent his per diem money on prostitutes he had "entertained" up in our room!
At the final night "Graduation Dinner" he quietly, and without authorization, ordered lobsters for everyone present.
When I walked into our San Diego office the following Monday, my GM called me into his office.
"What the hell happened there? We think we know, but tell us what you saw!"
As I listed the daily activities of this creep, they sat shaking their heads. They knew this was a setup. In the end, a series of lawsuits were filed against Voice-Tel! The perp claimed he was sexually humiliated because he was gay! After hundreds of thousands of dollars spent on investigations, it was discovered that this guy was a professional shakedown artist. He had successfully extorted money by way of 'courthouse steps' settlements with other companies, including AT&T!
The Rub? There is an underworld cartel of lawyers and bad actors that collude to extort money from businesses using the myriad of recently passed sexual and racial harassment laws.
Most of the cases never go to court because the deep pocket companies want to limit their exposure, so they settle out of court, regardless of the preponderance of evidence supporting their innocence.
Eventually Voice-Tel got bought by a large telecommunications company. In less than two years my role changed into a boiler room dial-for-dollars salesperson with little or no outside contact. It was time to move on again.
The North County Times
The building business in California has always been cyclical. Home building booms for 7 or 8 years, and then it tanks for a few. Some building recessions have been much longer, but typically the demand for homes in Southern California supersedes most economic slowdowns. So industry professionals hang around, and bridge the recessions and then get right back in the saddle as soon as the economy picks up steam.
In 1994 I wandered into the offices of the local newspaper, the Escondido Times-Advocate. I asked if they were hiring and they said, "wait here". In a few minutes I was taken into an office and introduced to the Classified Sales Manager. She was a stunning Irish redhead with a beautiful smile. We talked and I asked her if they had a Home Section, as I was experienced in new home neighborhoods and could be helpful in recruiting builder advertising. She said they were in the process of starting such a section and "when can you start?"
Suddenly I was thrust into a room with thirty desks and telemarketers. It was a noisy chaotic nightmare! I was given a computer program with phone lists of every builder, real estate agency, and home decorator in North San Diego county. I was directed to call them and encourage them to advertise in the paper. To sign a 13 week ad appearance contract and then to go to the art department to develop an ad for them.
I was directed to focus on real estate developers, agents and brokers.
It was nearly an impossible task because home builders already spent fortunes in advertising with the San Diego Union Tribune, which offered ten times the number of subscribers. And they spent millions on signage and point of purchase literature, on glossy ads in travel and real estate industry magazines, on radio and TV, and didn't need another print cost when the market was so slow.
A few weeks into my tenure, I went in and talked to the Sales Manager. I pleaded to get the New Homes section up and running as soon as possible. I had some ideas: Builders sell most of their new homes to locals, so what if we could do a cross promotion with a furniture chain to put up a drawing prize. Readers would fill out a coupon in the Home Section and submit it at a participating model home complex sales office. We would hold a drawing every 2 months and award a $5000 furniture shopping spree with an advertiser. We could offer special ad rates to attract both participants, and hold a news conference when the winners were announced! Builders get lookers, furniture stores get exposure, and we get advertising from all of the above plus some "ride alongs" that want new home buyers business, such as real estate agents, moving companies and landscapers.
The idea went over well and I was a hero for a while. Unfortunately, The TA distribution was very small and yet they charged similar rates to the Union Tribune, with millions of readers. Ad agencies are paid to discern these differences and our projected revenues never materialized.
But then a Big Whale came along. Howard Publications, a family owned company that ran 16 other newspapers around the country, decided to buy into the rapidly growing San Diego media market. They bought two local papers, the Escondido Times-Advocate, and the Oceanside based Blade-Citizen. Those papers were merged and The North County Times was born. Management changed, and I ended up right back in the classified sales department. The new owners simply abandoned the New Homes concept and settled for the traditional classified format for real estate ads.
I wasn't cut out to sell classified advertising. Especially in a loud atmosphere where I was, by far, the oldest guy in the room. I loved the idea of working in the media in a local capacity, but not taking orders for garage sale ads. The fact that Howard Publications was now running the smalltown newspaper was sad, because they, like all major corporate conglomerates, only focused on revenue.
I never reached the point that I had imagined: Tending to the larger builder ad agencies, going to lunch, participating in field promotional activities and eventually gaining a following of builder and real estate broker accounts. Instead, I was expected to tend the phones, write up redundant small time ads for agents and accept the fact that the Home Section was not viable competition for the San Diego Union Tribune.
The Rub? Little entrepreneurial businesses that become highly successful often get eaten by Whales. I started looking for a way out of the boiler room. If I was going to have to do dialing-for-dollar sales, I wanted to do it in the comfort of my own home.
Golf Southern California Magazine
I was still working at the North County Times when I picked up a free magazine at one of the local golf shops. It was a 14" X 11" newspaper tabloid format, with a variety of "news" stories. Most of the content was summaries of recent amateur and college golf and celebrity benefit tournaments, and advertorials about golf resorts around the western United States.
As I leafed through Golf Southern California Magazine, I noticed an ad by the publisher looking for an outside salesperson. I was growing disenchanted with the new management policies at the NCT, so I called the number.
I met with owner and publisher Bernie O'Brien (another O'Brien?) and we immediately hit it off. He suggested I keep my job at the newspaper, and do the magazine ad sales on my own time, evenings and weekends. I could do much of it by phone, and he claimed just making contact would result in a significant increase in advertising space sales.
The magazine was published 4 times a year, distributed to golf shops, driving ranges, sporting goods stores or any retail location that attracts golfers. It is offered free, and the entire contents were collated by the publisher. So I hoped there would also be some writing opportunities for me.
I accepted the terms (essentially all commission) and went directly to a public course very near my home on the following Monday afternoon. That call resulted in a one year contract worth $30K! I went home and told my wife I had found my new career! This was just too easy.
Not so quick…
It didn't take long for me to discover how unpopular the magazine actually was. Many of the golf course general managers resented the "discount" coupons most of our advertisers offered. They considered the newspaper tabloid format "cheap" and the absence of major golf manufacturers' advertising indicated brand name advertisers felt the same way.
I worked hard tracking down and contacting dozens of equipment manufacturers and their ad agency reps, only to be blocked. Too often uncollected magazines would stack up in the stores, exacerbating the issue of lack of readership. The truth was that the content was weak and focused too much on inside-baseball amateur tour stats. Advertising agents didn't see the value in our format or any way we could quantify our "free" distribution.
Every step of the way I was frustrated. My friends thought the magazine was boring and full of useless information. I was not making any money.
There were some positive impacts for me: I was given access to many top golf courses as a member of the print media. After PGA tournaments, the media was often invited to play a round of golf while the television equipment was removed and the course cleaned up after the crowds left trash all over the grounds, so I got free rounds at Riviera, La Costa, Sherwood Country Club and Torrey Pines, among others.
Hoping to increase readership, I convinced Bernie to let me contribute a column I called "The Driving Forces In Golf". I interviewed some of the icons of the San Diego golf scene, and did historical backstories on some local resorts and how they came about.
The Rub? It was like going to school. I wasn't making any money but I was meeting many golf industry icons and sharpening my writing skills.
Players Golf
As I circulated around the county trying to elicit ads from the various golf industry affiliates, I stumbled upon a company called Players Golf. I walked into an enormous facility in the industrial park in Poway. As I was trying to sell the GM on some advertising he asked me if I might be interested in joining their start up company.
"How so?" I asked.
"As a Regional Sales Manager. I would be setting up accounts in six states selling equipment to dealers on a direct basis."
"Can I see some of the equipment?"
He escorted me into an enormous, essentially empty warehouse in the back of the huge industrial building. There was a giant golf ball painting machine, spitting out balls with their logo on them. There were piles of boxes just being unpacked and we walked over to inspect some of the clubs they were shipping in from China.
It turns out Players Golf was owned by a Chinese manufacturing tycoon. He was making a fortune casting stainless steel club heads for domestic companies like Cobra, Arnold Palmer and Wilson Golf. His plan was to import his own unique line, using similar quality controls, and sell direct to shops at a much lower cost. To do this he had to have a stealth brand, because he would be competing with his own customers.
The Regional Account Manager's role is to set up on-course pro shops or smaller independent shop owners who either couldn't get the major brands because they were too near protected retailers or who wanted to increase their margins with an alternative discount line.
My thought process was this job could coexist with my job selling Golf Southern California magazine advertising, since that role was commission only, and I could devote as much time to it as I wanted. So why not give Players a shot? My first set of clubs as a beginner golfer was a "knock-off" brand called Cobra, which was a copycat of Ping, and look how successful that line became? The idea of a stealth product line was a proven concept.
I soon found myself back in a boiler room dialing for dollars again! Our bait was simple: Players will send the prospect some product on consignment. If they couldn't move it quickly just send it back, no obligation. I had no problem engaging golf pros at small town golf courses in conversation. I was getting one or two a day to put some product in their shop.
Every few weeks we would get a new product from China, and each time the designs were solid and the suggested retail prices were outstanding. We were getting state-of-the-art equipment, and we would get on the phone, and get our dealers to agree to take more on consignment.
Months were passing and most of the product was not moving. When it did and the buyers wanted more, we couldn't get delivery dates on shipments from China. There were always excuses, like "One of our trucks went off a cliff!" Or "The roads are closed due to snow!" For every one step forward, we took two steps backward.
Management wasn't too concerned about cash flow, and none of the salesmen were getting any overrides. We were slowly starving. The company encouraged us to keep trying and they kept promising more and better products, but the marketing plan was failing. The pros were neither selling the clubs or sending them back. They had no skin in the game.
Here's The Rub: It finally occurred to me that the Chinese Tycoon's domestic stealth golf company was really a con job. It was designed to fail. Players Golf was providing a tax haven for his enormous domestic income generated by his factories in China.
The entire sales staff was getting played.
Once again, I was confronted with a career choice. My golf industry experiences were turning out to be costly mistakes and I was wandering down what looked like a dead end cartpath.
Kitchens Plus
They had two showrooms, one on Miramar Road across from the Miramar Naval Air Station, and one in La Mesa. They resold major manufacturers' cabinets from a variety of suppliers. They did no custom cabinets or refacing. The showrooms were first rate and the product lines were some of the best companies. I really liked the Canadian owner and the GM was a young, ambitious but down-to-earth guy. He volunteered to mentor me because my job required a thorough knowledge of automated kitchen software design systems and suppliers catalogs, as I had to fit modular products to the space, using limited SKUs. It was going to take some time to become competent with a half dozen different manufacturers' product lines.
Working in a comfortable showroom was a welcome change. Occasionally going out to prospects residences to gather measurements and suggest design ideas was also refreshing. I enjoyed the challenge and the opportunity to apply my creative skills to design.
I was actually quite happy there, because the General Manager was really helpful and active. The products were good if you ordered them properly. But they were fairly expensive, so the closing rate was 1 in 10. That meant you had to go through the entire process (in-home interview and assessment: preliminary design; modifications and final proposal and design) nine times for free. All of which would take me at least 12 hours to complete, if everything went perfect and the customer agreed with everything. That seldom happened.
That means I would spend a minimum of 120 hours to win one contract. But many times it took much more than that since it was a new business to me. There were times when I was making $10 an hour! I was driving across town, and spending additional hours fighting drive-time traffic commuting on interstate 15. It was hours in the showroom, then many hours outside, often on weekends and nights.
One of my clients was a Systems Risk Analyst for a major international government contractor. They did huge risk analysis on billion dollar projects. As I sat down with him and his wife to get the sign off on their Rancho Santa Fe kitchen remodel project, he asked me if I was aware of my vulnerability to legal action over our workmanship. He suggested that since I was putting my signature on the contract I could be dragged into court and possibly held liable for faulty workmanship.
I said no, I was not the owner of the business, just a sales rep. He shook his head and said I should never put my name on legal documents unless I had to. I was shocked. I had never considered myself potentially liable for things that happened on my projects.
After that, in the back of my mind, I was very uncomfortable: I had witnessed one of our installers do something very questionable during the process of remodeling a kitchen. I did not report it or make note of it. The installer and I had agreed to do it because we thought it would be OK, and we just wanted to get the job done and move on. Were we to follow codes it would have required a major redesign, new permits and major delays.
The Rub? I decided it was time to find another job because I knew the boss was never going to allow me to keep my signature off of the contracts. Plus, I was constantly longing for work closer to home. And I just couldn't understand why that was so hard to find…
Wildcat Door Systems
Back in the late 80's when I was working directly for Merillat as the company area sales manager, one of the questions purchasing agents would invariably ask me was:
"Do you guys provide other wood products other than cabinets? We need recessed fluorescent light frames on the kitchen ceiling, and we want them to match the cabinets. Some of the local cabinet shops will do that for us. Can you?"
"No, we can't."
That put me in a competitive disadvantage, so I began looking for a local source.
I was measuring a new home in one of my Merillat projects when I ran into a young man on a ladder in the middle of the kitchen area. We started to chat and he revealed that he had a small business providing light frames and fireplace mantels. I explained my dilemma and we made a deal: If I needed to include either of those items in my proposals, he would simply do the work as a subcontractor. He promised he could make the finish match ours and everyone would get what they needed.
Rob eventually became one of my best friends. He and I worked on several projects together, but even more importantly, he was there for me when times weren't so good. At one point as the economy was recovering from another recession, we were discussing where the building industry was going and what new products might become "the next big thing". I said if I were going into the business all over again, I might think about the garage door business.
In California near the end of the 20th century, very few new homes were being built with metal roll up doors. In most markets outside of California, stamped metal sectional garage doors were the standard, but in California, because of the mild weather, builders stubbornly stuck to the much cheaper, but awkward and dangerous, plywood doors.
A few months later Rob called me up and said, "I've been thinking about what you said about the garage door business. I have done a ton of research, and I want to start a new division of my business. I am going into the garage door business and I think you would be a great sales manager. Are you interested?"
That was the genesis of Wildcat Door Systems. We came up with that name because we were like the wildcat oil drillers in Texas. We were drilling new ground, venturing into someone else's territory, and at that point, had no idea how we were going to do it.
I moved into his office space in his light frame and fireplace mantel manufacturing shop in Escondido. Within a year we had grabbed 6% of the entire San Diego garage door market. It started to grow exponentially. Eventually Rob added stamped metal Attic Access Door Frames to our repertoire. It was a clever frame to finish off those little attic crawl space openings typically in the hallway ceiling.
The overall per unit contract amount was commensurate with a cabinet contract but much less complicated.
Wildcat Door Systems was started on a hunch. It turned out to be a good one, but we weren't the only ones becoming aware of the growing metal garage door demand in Southern California. When we started the business, there were only a half dozen sectional door vendors in all of Southern California. In less than three years, that number had grown to forty!
And my name never appeared on any of the contracts!
Early in 1998, Rob walked into the office and said, "I'm done. I am going to wind down garage doors first. There is no way to make it profitable, and I can't go on doing so much of the field work myself. There has to be more to life than this!"
Rob was right, the product had become a common commodity and too many dealers were willing to lose money just to win a contract. As with most every aspect of the home building business, big national industry whales were swallowing up little independent contractors. Margins were almost nonexistent, and there was no loyalty amongst builders under pressure to manage price inflation as supply was constantly being limited by environmental regulations and anti-builder public sentiment.
The Rub? Only sharks can swim with whales. Pesky little fish eventually get eaten. It was shocking how fast things can change, and that was the lesson of the day. Rapid cultural and business change would prove to be the ongoing theme of the 21st century, and the story of my life.
Major Lines of California
My job at Wildcat Door was soon to be extinct. Rob didn't need a sales manager to run his super simplified mantel and access door business. It was inevitable I needed to move on. I was working in the field on one of our projects up in the hills above La Costa lagoon, in Carlsbad. We were doing the garage doors, but I snuck inside to see what cabinets they had used on this very high end custom home. There was a brand name on the hinges: it said 'Montalco'. Never heard of them, so I looked it up on the internet. The website indicated they were Canadian, so I called the home office. They said they would have the local distributor contact me.
The next day I got a call. I was shocked at the irony! It was a former Merillat rep who I knew very well. He was now the GM at Major Lines of California (MLC), who was one of the Orange County warehouse distributors I had serviced during my previous term at Merillat. They were the authorized regional distributor for Montalco Cabinets, made in British Columbia.
"Come see me, I have an opportunity you might like!"
In just a few weeks I was commuting to Anaheim and working for MLC. They had just acquired a large contract for Montalco Cabinets for a golf course community just a few blocks from my house in Escondido. I would be the lead contact to service the project which would take a couple of years to complete. Plus, I could sell and service other projects as they came along.
Major Lines also sold Merillat, along with several other consumer driven lines, but Montalco was their lead line, aimed at builders who increasingly wanted the "Euro" look. It was an excellent product at a competitive price, though it faced some challenges because of the shipping distance. The rep that had sold the contract had moved out of state, so I would collect his commissions as the loads were installed. I just had to measure each new house and make necessary changes before faxing the order to Montalco's factory in Richmond, British Columbia.
It was a good fit, but I found myself commuting at least three or four days a week to the Anaheim office and to service some projects I won in south Orange County. Most of the jobs went smoothly, and fast. But I was running to keep up, measuring framing, collecting scheduling updates, correcting orders for variations and change orders, and meeting truck drivers to direct unloading. Then meeting with installation crew managers to make sure they were keeping ahead of schedule. I typically had three different jobs going at any one time.
A few years later I was burned out.
The Rub? My boss left soon after I came aboard. He decided to move up north after an ugly divorce, so I felt somewhat abandoned. I was continuously feeling pressured to work more in Orange County because the logistics of installation in San Diego was causing MLC to suffer low margins. I knew I had to cut the umbilical cord to LA and Orange County. I had to find permanent employment in San Diego.
Schmid Building Supplies
The ad said they were looking for someone familiar with Merillat brand cabinets. "New Division: Great Opportunity!" The home office was in Poway, just 15 miles south of Escondido. The GM met with me and I was sure I would get an offer. I did, and I started right away.
The Schmid job offer couldn't have come at a better time.
The salary was decent and my job was to help Schmid Building Supplies, a newly acquired subsidiary of Masco Corporation (yes, the same one that had let me go just a decade earlier) to grow their new cabinet supply division. Schmid Building Supplies also provided fireplaces and fiberglass insulation, so adding cabinets seemed like a good fit to keep expanding Schmid's presence on construction sites. They already had the warehousing, the delivery trucks, and a labor force, and I had an established connection with many of Merillats corporate employees. Schmid had a great reputation and offered customers unified billing and single source help for issues that came up during construction.
What could possibly go wrong?
Masco management handed Schmid a big Merillat cabinet account with Pulte Corporation, which at the time was the No. 1 homebuilder in America. They had acquired a local builder and their properties in San Diego, so they now had several hundred new homes on schedule for the San Diego area. Another Schmid salesperson was given the job of babysitting that ongoing established account, so I was hired to find new Merillat customers and to help build a newly established self supporting cabinet installation and service division.
After a slow start I was introduced to a young man who was converting apartments into condos. He told me later he gathered up as many credit cards as he could get his hands on and maxed them out to acquire the apartments. Then he would bring in a few investors and within as little as 90 days, renovate and flip the units for enormous markups. His market was first time buyers which was an enormous demographic, so the market for his product was hot!
He said he had made $3M in just the past 18 months. A loophole in title law allowed the previously rented apartments to be re-entitled as new property after an ownership change, even though the wiring and much of the structure was not new. There was a huge inventory of 'for sale' apartment complexes because thousands had been built in the 60's and the owners were now ready to cash out their amortized properties before they had to invest their profits back into renovations.
As an authorized Merillat distributor and a recently acquired subsidiary of Masco Corporation, Schmid Building Supplies could offer these "flippers" extremely fast turnaround times, so I had a competitive advantage, and I could offer a variety of finishes so each condo appeared to be custom built. For flippers, time is critical and in short supply. We offered them quick turnaround and reasonable pricing on prefinished cabinets.
Over the next few years I won contracts from a number of these "flippers" amounting to thousands of units a year. I was a hero! But all was not well…our system for ordering, cross docking and installing the cabinets was never efficient. Oh, and to make it exciting, all Masco businesses were required to join a new computer system called Oracle. It was supposed to tie them all together, homogenize their language and increase efficiency exponentially!
Where have I heard that before? The transformation was a colossal mess.
Plus, my customers were walking a legal and financial tightrope. They were rogue entrepreneurs, most with little construction experience, and they were wards of their lenders. And worse yet, they were getting sued left and right for construction defects.
Schmid was a union shop, so they would always promote from within. Many of their "cabinet" installers came from other trades and were not experienced in the cabinet arena. More experienced installers preferred to work independently and could make much better money. So word spread quickly that the Schmid cabinet division was unreliable.
The Masco corporate office in Michigan was getting negative feedback from some of their major builder accounts in Southern California and the pressure to fix our cabinet division problems and expand our sales got turned way up.
As we ran smack into the 2008 Great Recession they shifted me into a new role: Servicing retail stores from Santa Barbara to the Mexican Border under the newly created business identity of Masco Retail Services Group. Most of the few existing accounts were mom and pop businesses and most were devastated by the downturn. But, getting away from the problems with the builder division was a relief, or so I thought. I looked forward to being out on the road again, setting my own schedules, and coaching my customers in sales and design. I had an enormous territory, so I spent one or two nights a week away from home.
It turned out to be the darkest and most depressing period in my professional career. In the span of just over a year, I watched 70% of my retail accounts go bankrupt. Our retail division was stillborn. I had personal relationships with retail business owners, so watching them get crushed was horrible. As the effects of the Great Recession wore on, the builder business was tanking too. Masco immediately started downsizing, and California, which had seen exponential growth, was bleeding cash.
I knew the end was near when in late 2009 they asked me to do a survey of my territory, and to avoid any mention of the companies decision to merge all of their cabinet businesses into a new corporate entity to be called Masco Cabinetry. It was a business decision to cut costs, and "right size" for the economic downturn.
Recently the company played games with the truth. I was caught in the middle because I felt a sense of responsibility to help my customers be successful. How could I lie to them and still be a reliable business partner?
I was going home at night feeling dirty. I felt like I was being used to perpetuate a lie. As my retail accounts were struggling to survive, our recently relocated production facilities were struggling to produce and deliver a quality product. I spent most of my time visiting dealer projects that wanted answers: Why was the product so inconsistent? Who was responsible for fixing, replacing and servicing goods that came out of the box damaged? When was the litany of problems going to be resolved?
Being a manufacturer's representative demands that I do what is in the best interest of the company. I get that. They pay me to present the best possible image to the marketplace. I am, over and above all, an order taker. As a sales representative I am supposed to attract, recruit and service new and existing clients. I have no problem with embellishing the truth. That is what is called sales. But that is different from avoiding or inventing the truth.
One of the fundamental rules of outside sales, a rule I was taught in the very beginning of my journey, is that I would get 80% of my sales from 20% of my customers. It would behoove me to identify and coddle that group. If I could take care of them, they would take care of me. I found that cliche to be 100% accurate. I didn't entirely ignore the 80% that were less productive, but I made herculean efforts to provide outstanding service to that 20%. When things went wrong, those dealers would look the other way. They wanted to believe me. They wanted me to be successful because we liked each other and we had each other's back.
I looked at it as a partnership. We all make mistakes, the secret is to work together to overcome obstacles, to resolve issues, and to make money. So trust is imperative. At least in my view, I have a hard time sharing responsibilities with people I don't trust. I honestly trusted my clients more than I trusted the management of Masco Builder Services and our Masco Retail Services division.
My District Manager, who I believed was a good, hard working, and serious individual, was 'owned'. He consistently ignored my customers' problems, assumed they were liars, and scolded me if I defended them. Even when it was obvious they had legitimate issues with what we were shipping them, my boss always sided with corporate.
"Find a way to avoid any expenses. The Company will not assume any liability. Period."
But we do have an obligation to deliver on our promises, right? If the end user believes they have been deceived, rightly or wrongly, don't we have a role in that perception, especially when what they are unhappy about is the condition of our cabinets when they are unboxed upon arrival?
At some point the customers won't tolerate excuses: They paid for a fine piece of furniture and too often it is arriving defective or damaged.
The company insisted I improve my lying skills in order to retain clients that were losing faith in our product. They offered advanced training in manufacturing fairy tales about why they should not be held accountable for product shortcomings, shipping damage or ordering errors.
They sent "Relationship Managers" to ride along with me, to monitor my approach and hoped their youthful enthusiasm, computer skills and willingness to embellish the truth would rub off on me.
After in-person meetings, some of my most trusted dealers would take me aside and commiserate with me, wondering how the company could possibly think their new line of rationalization was going to do any better than their last one.
Wouldn't it just be easier to fix the problems at the source rather than losing customers?
It was in the Summer of 2010 when I was 'Formally Released' by Masco Corporate. Our California building products division had racked up $130M in sales in 2007, but when they notified me they "were going in a different direction" the projections for 2010 end-of-year statewide sales would be only $28M. Masco Cabinetry, which was the new name for the merged cabinet assets, was going to have to stand on its own merits and Masco Builder and Retail Services Divisions of California were dissolved.
Here's The Rub: I just wasn't cut out to be a corporate guy. Big impersonal corporate operations require submissive role players, not individuals. Sadly, my fellow employees all knew the house of cards would eventually fall. We were like rabbits in a forest fire: Scrambling to find shelter. Some ran towards the fire, I ran away.
At one time Masco owned Merillat Industries, Quality Cabinet, Kraftmaid Cabinets, and a slew of cabinet distribution centers, as well as several factories in China that made component parts. Corporations have no tolerance for businesses that stumble and bleed profits. Ten years later, in 2020, Masco Corporation threw in the towel and sold off all of its cabinet assets to one of its competitors.
The conglomerate that I competed with, who owned a group of cabinet companies around the country, ended up buying Merillat, Kraftmaid and Quality Cabinet. They also own Cardell, Medallion, and MasterCraft too, among others. They make their mission to deliver their product in stellar condition, which was my main issue all along. With that said, they now dominate the retail cabinet industry.
The Rub? I started off with Merillat on a winning streak, with a state of the art cabinet maker who outperformed their competition. In the end, after the company was taken over by MBA-taught know-it-alls, I ended up without a job while they sold the company to people who did what I had been asking for all along.
China Syndrome
After my release from Masco Cabinetry/Masco Retail Services, I was really depressed. I had watched hundreds of customers/dealers, contractors and friends lose almost everything in the Great Recession. The California new home builder industry was a skeleton of what it had been in the 80's and 90's. The Great Recession, combined with dozens of new state and federal financial and environmental regulations made the environment for construction toxic.
It looked like I was going to have to start all over again, again. I was, at that point, 60 years old. My computer skills were quickly falling behind. My experience in new home construction had no place to be applied. I had spent the past two and a half years working retail relations, and none of that was going to help me now because the survivors were still struggling. The Chinese had invaded the marketplace, and the Big Box Stores were the last man standing in terms of domestic cabinet sales. I had worked with big box stores in the past and it is a hapless job.
I worked briefly for a Chinese manufacturer as an Account Manager on their one big customer, HD Direct (which is a spinoff of Home Depot. It is a direct channel for apartment and condo owners and contractors for supplies related to property management). That was a total clusterfu*k because I soon learned that Chinese business people have no qualms about lying. They have no shame. In fact, it is considered a normal and admirable "skill" to "out-lie" your customer. Neither I nor the buyers at HD Direct could rely on anything they said.
I had taken the job knowing it probably wouldn't last too long. I needed to reinvent myself and this wasn't going to lead to that. But I secretly hoped for a tour of their Chinese factories. If there was any chance I could get a free trip to China, I was going for it. But that promise turned out to be just another lie.
The Rub? I learned the hard way that Chinese business ethics are 180 degrees out of alignment with ours. And sadly, the Chinese were going to play a major role in the future of not only the cabinet business, but virtually every business in America.
Kitchen Barn
One of the assignments I had towards the end of my term with Masco was to survey every single independent retail cabinet store from Santa Barbara to the San Diego border. I had to submit a report on what I found out, so I can honestly say there were very few cabinet and kitchen design businesses I didn't know about.
A few months after my release, I cleaned out my garage and as I was dumping toxic chemicals (paint thinner, old paint, etc.) at the local waste facility in Ramona California, I decided to drive up and down Main Street. It is a quaint little community with a western motif, and Main Street is only 10 blocks long. Suddenly I see a store front sign "Kitchen Barn: Kitchen Design Center". I was shocked! I should have known about this place, so out of curiosity I turned into the parking lot and walked in.
It was a beautiful showroom. It had a gigantic island and a fully functional kitchen. It had cabinet, countertop and accessory displays. And, it had a camera system to capture cooking demonstrations to send over social media platforms.
I immediately engaged the owner, a nice man who described his vision. I told him I was caught by surprise because as a factory rep it was my job to know about his store, but I had no idea. I turned to walk out and he said, "Come back soon, we have a lot to talk about. I think you might be interested in hearing more."
A week later I went back and had lunch with Matt, and he offered me a sales position. I had not worked in months and was getting a little bored, so even though it was nearly an hour drive each way, we agreed I could work part-time. Of course, it was commission only, but if I were to believe his projections, I could make some money and contribute my industry knowledge. I had to learn a different computer cabinet and countertop design system, and the specifications of other accessory items that go into a new kitchen remodel. I can do that…
For about 18 months we had a lot of fun and I made some money. We attended sales conventions and vendor sponsored training seminars. He sponsored his son in the sport of midget race cars on dirt tracks and I enjoyed attending some of those at Barona Speedway in Lakeside California. We had a great relationship, and I was pulling for Kitchen Barn to develop into an established outlet for the area, which was destined to continue to grow.
But the long hours in the showroom with very few walk-ins made me restless. I wasn't making enough money to justify the time and travel expenses. I can only sit at a kitchen counter for so many hours of the day…the business had survived for four years but it wasn't gaining any momentum. It was supported primarily by Matt's longtime clientele he had acquired while with a different cabinet business, so he was doing quite well. I wasn't getting enough leads and despite massive social media presence, the walk-in numbers never improved. I felt like I was being used to babysit the store while Matt worked in the field and spent time helping his kids with their hobbies.
As much as I liked the atmosphere, it was obvious I was once again going to have to move on.
La Costa Patio & Spa
I had purchased a used spa from a local dealer. He takes some units in trade and refurbishes them, and he offered to haul my now 20 year old spa away for free. During one of my visits to buy chemicals he lamented he could not find reliable salespeople. I said "What about me?" He looked stunned, then asked if I was serious. Why not, I am an avid user, I have always said my spa is one of the best investments I ever made. I can relate, and I have extensive experience in showroom sales. The showroom was only 10 minutes from my home, so it appeared to be a win win.
I didn't need to make a lot of money because I would soon be collecting social security checks. Selling a $15K spa generates a $600 commission. With a small base, I thought I could easily hit my $13K SS earnings ceiling with just 2-3 sales a month.
But the owner was a jerk. He thought intimidation and insults was a viable training device, and the economy was still in recovery so we only got 3-4 walk-ins a week. After 6 months of suffering his demeaning comments about slow sales, long hours sitting around the warehouse waiting for customers, and having only earned $3500, I quit.
The Rub? I learned that I could save more money than I was making by just staying home and cutting expenses. At 65, that was becoming real attractive.
IDEL Designs
I saw an ad on CraigsList looking for a salesman with experience selling countertops, new cabinets, cabinet refacing and refinishing. I had done all of that over the years so I made an appointment to interview at the Escondido shop.
It turns out I had met the owner years ago at one of the local Home Remodeling shows and I remembered him because he reminded me of a character in the Rocky and Bullwinkle Show. Henry was a photocopy of Boris Badenov. He had been a fixture in the local kitchen remodeling business for 17 years. He instantly hired me with a generous commission plan paid upon presentation of a signed contract. He told me he guaranteed customer satisfaction and never asked for a deposit. The customer pays the entire contract upon completion and sign-off.
How could I say no? How could prospects say no? I could offer refinish, reface and replacement services. I could work out of my house. He offered a gasoline subsidy. He provided all the leads and I made my own appointments. Done!
I spent the majority of the next three years working part-time for IDEL Designs. The shop was a mess and undisciplined. No showroom, just a front office with cabinet doors and granite and quartz samples scattered randomly around. Henry was arrogant and aloof, but he genuinely wanted me to be successful, so we spent a great deal of time discussing tactics and field issues.
I had a good relationship with his chief designer and field operations manager. He had an impossible job, trying to schedule unreliable subcontractors and get people to show up. Most of them didn't speak English, so having Oscar, who was fluent in Spanish, was imperative. But communications were the weakness of the company, and the customers were the ones who paid the price for it.
One time, while working a local remodeling consumer show, someone noticed our promotional video-loop playing in our booth. He said, "That's my kitchen!" so I stopped the guy and asked him in a joking manner, to stand with me and give testimonials. He said, "Are you kidding? I would never do business with Henry again!"
That was the last straw. My simmering displeasure with the inconsistent quality of work and our inability to get repeat business was boiling over. "Boris" was a master salesman in his own mind. He used manipulative tactics to close sales and if that didn't work he gave the job away because he was the owner and he would "make it up" on the next guy, while I was given little leeway on pricing.
His workers were disrespectful and unreliable. He definitely made efforts to "fix" complaints, but many people just gave up complaining after making too many unanswered phone calls. I was told by the guy walking by that after he collected payment, Henry was never available when issues came up over poor workmanship.
Henry was making a lot of sales, but I wasn't. I was getting hurt by pricing that included my "generous" commission, while his pricing was whatever he needed it to be.
The Rub? I got tired of waiting for my paycheck to clear the bank, of getting phone calls from customers who felt disrespected by the installation crew, and running down leads in south San Diego county where the chances of closing my sales were much lower because we had to add crew travel costs into my bids.
I stuck it out when I wanted to just go home. But when Henry told me he was selling the business, I was done with cabinets and remodeling. Period.
In 2019, I retired for good.
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