Friday, August 20, 2010

Be Your Own Boss: Blog Two

Some people might think all teenaged "cart jockeys" are flighty, unfocused clock-watchers with a 'zine in one hand, a snack in the other and the radio blaring—kids whose goals and plans barely push beyond scoring pizza for dinner and tracking down the next gotta-have-it CD. But those people are wrong. Jon Scheerz is proof.

Seven years ago, Scheerz was just 17 and working a retail job. But unlike the so-called slacker teen, Jon had aspirations, and more. He had the willingness to invest the time and hard work it takes to forge a long-term career in specialty retail—a career that started, ironically enough, with typical teenage trials and tribulations.

Jon began his career selling golf equipment and specialty items part-time at an in-line golf store in Burnsville, MN. One Saturday during the Christmas season, the owner of Retail Ventures dropped by after lunch and found a large group of potential customers peering angrily into the store through the metal gate. Obviously the store was closed.

"The owner thought I had just decided to close up shop and grab lunch or go shopping," Scheerz says. "But I told him we were having a record day—more than $3,000 by noon—and I had to get more change for the register." So the owner stayed and worked alongside Scheerz for the rest of the day.

Within a month (and still just 17), Scheerz was promoted to store manager. As such, he also started traveling with the owner to the company's 40 direct retail stores and pushcarts, as well as supplying more than 20 owner-operators at the same time. Scheerz stayed with Retail Ventures and helped the company grow into a diversified corporation that specializes in, as he puts it, "making specialty retail marriages."

Some background: When Retail Ventures started in 1994, the cart industry had taken off and was expanding. At the time, specialty retailers believed their particular cart program/product, whatever it was, would last forever. Contradicting that belief was a prominent mall developer who said that cart owners who think this is an ongoing career "couldn't be more wrong." The contrarian was right: The specialty retail industry and the mood and tastes of the buying public move too fast for anyone to sell exactly the same product year after year. And so the industry and the retailers have to evolve.

Retail Ventures found that evolving—and therefore surviving—meant that they had to find new products, sign on more owner-operators, and help malls establish more cart programs. At the same time, malls were growing at enormous rates without enough product diversity to support their growth. They needed and wanted help finding new concepts for their owner-operators. As a result, a great demand rose for someone to develop and market new lines for manufacturers who were new to specialty retail and didn't know how to distribute their products to the increasing number of cart owners.

Retail Ventures saw their opportunity. They could rely not only on their expertise in manufacturing products in the past, but on the experience gleaned from the mistakes of their corporate and owner-operator locations throughout 15 states. They did the research. And Scheerz was there.

Today, the company offers turnkey opportunities in which entrepreneurs can inexpensively and conveniently open their own business. More than that, they are involved in a program in which the product concept is proven through different malls and other test markets—a way to avoid the risky "stock and rock" approach.

"You really only have a few weeks to learn your product line," Scheerz says. "A lot of operators, mall developers and manufacturers still don't understand how difficult it is to physically go out to the merchandise and trade markets—to find, source out and create their own line of products for a cart operation. And then be successful with that product line within a 60-day window during the Christmas season."

Retail Ventures knew how to package a product line so that an owner-operator could run the business successfully, without having to worry about testing the product and the market first. They took away the guesswork, and catapulted themselves into the business.

Being the first representative company in the specialty retail industry as well as the largest has meant years of work for Scheerz and the Retail Ventures staff. "The reason we have been able to locate new products and open successful owner-operator programs is that we understand the industry," he says. "We're retailers ourselves. This allows us to focus on and understand the operator's needs more than anybody else in the industry."

Within the past six years, Scheerz and Retail Ventures have represented 30 different product lines, and brought more than $1.5 million in wholesale to more than one manufacturer during the first year of representation. Scheerz says they focus on between just nine or twelve a year so that they don't lose sight of the best product lines. "[This] allows us to offer the owner-operators and malls a chance to rotate in and out of product lines through the year," he says.

Retail Ventures has opened more than 800 owner-operator programs, with the majority of owner-operators active within the specialty retail industry. The company employs six people in the office, and will hire as many as 30 seasonal workers to manage their direct retail programs.

Today, at age 25, Scheerz has an impressive resume with considerable retail experience, including visual merchandising and retail manager of Merry-Go-Round Enterprises, as well as district and regional manager of other large retail chains throughout the country.

In addition to operating some of his own retail carts, he recently purchased the company that generates more than $2 million a year for their manufacturers, and projects more than $3.5 million this year. On the direct retail side, he projects more than $250,000 in sales during Christmas, and more than $500,000 in 2001.

Keys to being successful, he says, include choosing the right products and maximizing efficiency. "We have always been a big supporter of operating multiple units within one mall, versus operating one cart in ten different malls at the same time," he says. He finds that it's much easier for owner-operators to expand within the same mall with different product lines, due to their knowledge of the mall, mall procedures, sales figures, demographics, and past product successes. And placing a second cart next to a proven one can significantly cut some expenses in payroll, rent, shipping, storage, telephone and more. "It's much more productive to buy for two than just one," he says. "And as most operators know, on a Monday morning the mall's not the busiest place in town, so it's very easy... to operate two carts side by side."

Retail Ventures is in the business of growing specialty retail businesses. The company's key strategy, Scheerz says, is to stay in the forefront and make sure they assist in bringing the industry to the next level by finding new products... working with malls to locate qualified owner-operators... and helping those owner-operators succeed. And Scheerz, retail's Whiz Kid, is leading the way.

Tom R. Arterburn is Executive Director of The Resume Institute.

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