Vy Le, CEO Rudys Barbershop
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Vy Le, CEO Rudys Barbershop

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Brick and Mortar 2.0: How to Sell to the "New" Small Business

Brick and Mortar 2.0: How to Sell to the "New" Small Business

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  • Such an honor to be here among some of my favorite tech companies:LinkedIN, Facebook…I would love to create something where you could mash your products into one with something like match.com…along with matching up my favorite music and books, I could see if you dated any of my other friends or coworkers, how much money your potential partner makes, or even create a contingency plan by seeing if they have cuter friends…talk about a cloud base project management program that would be used….it really would save us time, a complete and full disclosure…Debbie requested that I speak at this conference, because she needed someone with “ honest insight” on how you can work with people like me, usually many of us, “2.0ers” lack key social skills ..which is why we are usually not invited to these things..
  • So, how many of you have heard of Rudy’s? How about Ace Hotels? Come on…you all read Septembers…Fast Company…Ace Hotel Lobby in NYC was just featured as the place to work from while staring at pretty people….and If you’re here with Google and you didn’t raise your hand…you must have missed the meeting where you launched the Google Chrome at Ace Hotels….tech and lifestyle
  • The same two founders that launched Rudy’s took their unintentional format and created a fanatical following of customers throughout all of their business ventures - everything from barbershops, to hotels, restaurants to bars. It’s quite amazing - They created brand equity in a lifestyle brand without a “face”… all while being based in Seattle…so, you too Vancouver, you can do it.. The only business plan they had when they started 19 years ago was/is to sell people what they need in a comfortable, democratized environment
  • Rudy’s Barbershop is currently in 14 Locations: Seattle, LA, and PortlandQ1 2012: Opening in NYC (next to Ace Hotels)By Q3 of 2012 we are looking to roll out our franchise opportunity 10,000 people come through our doors monthly. 70% of our customer demographic is Male (repeat, loyal, consistent), 30% are female (growing) –
  • Our friends, business partners include: Baxter, Apolis, Grants, Ace Hotels, Café Vita, The Stranger, Le Labo, Level, Bumble and Bumble, Linus Bikes, Durable Good Concern, Taylor Stitch and TOM’s Shoes…I’ve just named all the tenants in hipsterville…I’m very popular but I’ll get to why that’s important later…
  • Rudy’s is a small to medium size business from a dollar perspective but our day to day operations is still the same as it was 19 years ago…we use paper and keep all of our customer receipts, however, we are mobile…we have the state of the art, credit card swiper, you should see peoples reactions when we use it at events..the hipsters go wild, with their instagram But before I go any further, and talk about me “The Brick and Mortar 2.0 and how to sell to me”…Just a quick show of hands, How many of you here today have a business or are looking to start a business that wants small businesses like me as a customer?
  • Prior to Rudy’s I was in consumer driven health care and prior to that I spent my younger years, with a very small company called the Gap… you could say my professional career has been built around the customer, understanding what they want and delivering what they want into what they need. So in working with me, I always start with the obvious, the customer and their experience.I do love all the articles, about entrepreneurs being these savvy risk takers (it makes us sound smart) and the truth and what no one tells you is that we’re like a bunch of spoiled children, we have no filter, we’re bi-polar and we all want instant gratification. You can say it’s our parents fault but it really isn’t it’s yours? Technology has lowered the barrier and especially the cost to starting a small business. You taught us that everything should be free, we should share, and it should all be in real time…Streamlining my business is an obvious return on investment but streamlining alone does not provide you with a competitive advantage – That barely gets you into the game.So, in a world where everything is instant and free, I have nothing to lose – I could technically date as many people as I want.
  • Here is a story about how one company got me to commit (I’M USING ME AS AN EXAMPLE THAT I HOPE ALL OF YOU CAN LEARN FROM)When I went in search of a POS to scale my business, I wasn’t looking for a vendor or reseller that could offer me the best financing…I went in search of a company I could partner and grow with, someone who had the same vested interest…which is making more money for me. Coming from San Francisco and hanging out with tech nerds like Debbie; I knew that there had to be a tech company that catered to my needs and was hungry enough to see the opportunity. And being Debbie, she already had five that matched my “feature needs” So, like online dating, I looked them up, checked out their pictures, who their business partners were and sent them an email with my needs and wants, along with a quick profile about my company. Of the 5 that I EMAILED, only 3 responded, of the 3 only 2 had a “try before you buy” feature.Note – these were all emerging startups who were in theValley trying to drum up business (clients like ME) and only 2 got back to me. This is lesson #1 – when business knocks on your door; answer the f*#king door!
  • Erply had a simple and easy to read website, responded but what was most attractive, was I could test out the features without any type of commitment.After a test drive, I connected with them via email…and laid out their opportunity with me. I had nothing to lose. I always tell my managers to ask…the worst thing that could happen, is you get turned down – but ask with a point of view.I still have my first real email with Robert, VP of Sales…he opened the conversation with “would you like to talk about your business objectives and its priorities or would you like me to show you more features of our product”I knew instantly, that he got it and he was hungry for our business. So, like every smart-ass entearpuner, I asked him to prove it… I asked Robert, “do you know what small businesses hate more than anything else?” (anyone?)HR compliance.. “Your product is missing a very important feature (time clock) and if you build, I guarantee that it will increase your overall competitive advantage, you will have 2 weeks, and if you can I will roll out your POS as a beta-test in two of my flagship shops. I will provide you with full access to my workflow and my staff, therefore a real-live free testing environment.”I told Robert that this feature will eventually become a revenue source for my business, because, when a stylist clocks in, customers will be able to schedule appointments online, in real-time, with a specific stylist or the next available appointmentThis is Lesson #2! He asked for my opinion – and I gave him free market insight, and he gave me a key feature. We both won – and it was because he listened first, sold second!
  • Customization is not for everyone – Take the smart risk –This was an easy win for Erply…they didn’t realize that, it was that simple feature that could change how they could capture a potential service market -  Because, I was able to test drive his product, I knew 80% of the features would already work effectively and would increase the efficiency within our current workflow.But I didn’t care about that, I wanted to see if he would bend and take the 20% risk. ERPLY was able to build out the features needed for get the system into Silverlake and Bellevue for Phase I but they actually took me up on my invitation to fly out to LA and handle the implementation and observe our workflow –  This was our first, in person meeting, they had been there since 9am with the team and I had just stepped off a plane from NYC – and within 10 minutes of the meeting, I was about to fire them.  Now that I was able to see the full functionality of their system in my environment, I told them that they needed to tweak the dashboard…they had all the information relevant to my business, but buried in the system. Robert brought his boss with him, Martti, who was kinda like “alien” but Estonian…he kept saying “no..” I said to myself…let me lay out this opportunity to you again. If you make this happen, you will have a monopoly on my franchise business…I will only get in bed with you if you make it worth my time and money. Then I realized he wasn’t saying “no” it was his way of taking a “pause” like a computer system that is taking in the data 010101 and it coming out no…meanwhile, he was trying to figure out how the system would work to my needs – Frustrated…I drew this.
  • What was suppose to be a two day test turned into a week, with Martti (the Estonian) flying back with me to Seattle, We ended up spending the week together, with my team, troubleshooting issues and brainstorming. By the end of that week, in time for our annual store managers’ summit ERPLY had developed a new dashboard – something that was originally a customize build…turned into a dashboard that they can use for multiple industries. LESSON #3 – note that even through small businesses and tech startups both have the innate desire for innovating and immediate gratification (I think we’re both stubborn!) – we speak different languages. So, my tip to you startups: understand that tech lingo doesn’t sell. Find ways to communicate effectively.
  • ERPLY in turn has open up their team and resources to us and they are very much now a part of our team and its growth strategy; which includes our current shops, our new shops, our soon to be rolled out franchise model, our management services platform, and our partners In 4 months we were able to:5% ave increase in unit volume, 15% increase in product dollars Decrease the amount to time spent on administrative responsibilities for our managers by 50%We now the capacity to react/trend our business with real-time reportingTrends (service and product sales), Employee performance, Payroll took an hour vs. now it take 5 minutesInventory ordering now takes 5 minutes, more accurate, and easier to manage from a global levelFront Desk Training use to take a week is now done within a day –
  • All we want, 2.0 business peepsFree is not a value proposition it’s a requirementSecret shop your team: all aspects, customer service, web, and partners Take the Smart Risk – Instant gratification – because I don’t have the timeAsk me about my growth plan and how you can help – This give you a quick assessment of your business opportunityMake the investment for one site visit – We will never be on the same page until you see what I’m up against and how your product will fill that gap; Systems, hardware, etcBake into your business plan/budget that will allow for customization, see what I’m willing to pay for Expectations and values need to align to ensure successWord of Mouth – Ask me who my friends are and how they play into my growth plans
  •  SimplifyPhase in the transition plan: Switch Train, Gap Analysis, Opportunity, Partners.Help me switch out of the old systemTools for TrainingIdentify the Gaps in your system and turn them into opportunity Test with my partners 
  • So, since I’m the gift that keeps on giving, I’ve done your homework. I asked all my “Friends” for their wish list. For all of you looking to sell to SMBs, think of these points… I did your market research for you and here is the result.We have the following needs and wants…Our wish list will be published on the Rudy’s Barbershop Facebook page…if you find that your product meets our needs or you are interested in working on a customized product with us please send me an email – If it does, you will be invited to our next round table. At this roundtable will include key decision makers of the following small business…about 90% of them own the business they run.
  • Our wish list:Investors (this one might be confusing to the startup audience?)Direct integration with Social Commerce Platforms – share your database – Automated, reminder, wholesale system for preferred partners/vendors Interactive way to interface with our customers – Tracking system for the item purchase to its social justice cause, providing a call to actionAggregation of orders to increase purchasing power, meet minimumsInstant perks/loyalty program not based on discounts but points that could be used with partners, like minded businessEasy way to share our customer demographic with each otherFree Project management tool with less steps – Free Secure/HR compliant Intranet where employees get information, share ideas, schedules, etcPayroll – direct APICommunication tool that plugs into our CRM (customer leaves a message, text us, etc) or EMRLegal expertise, multiple lawyers for one monthly price 

Transcript

  • 1. Hello My Name Is..
    Vy Le
    Chief Executive Officer
    Rudy’s Barbershop
  • 2. “…In a world where money can buy anything, there is an increasing desire for the personal, a reaction against anonymous cookie-cutter experiences…”
  • 3. Vogue
    Paper Magazine
  • 4. Metropolis
  • 5. New York Times
  • 6. The Evolution of Rudy’s
  • 7. “ ....always start with the obvious, the customer and their experience….
  • 8.
  • 9.
  • 10. Employees will clock themselves in and out from a computer located in the shop.
  • 11.
  • 12. 50% of our manager workflow has been reduced within 4 months
  • 13. All we want, 2.0 business peeps
    • Free is not a value proposition it’s a requirement
    • 14. Secret shop your team: all aspects, customer service, web, and partners
     
    Take the Smart Risk –
    • Instant gratification – because I don’t have the time
    • 15. Ask me about my growth plan and how you can help – This give you a quick assessment of your business opportunity
    • 16. Make the investment for one site visit – We will never be on the same page until you see what I’m up against and how your product will fill that gap; Systems, hardware, etc
    • 17. Bake into your business plan/budget that will allow for customization, see what I’m willing to pay for
    • 18. Expectations and values need to align to ensure success
    • 19. Word of Mouth – Ask me who my friends are and how they play into my growth plans
     
  • 20. Simplify
    • Phase in the transition plan: Switch Train, Gap Analysis, Opportunity, Partners.
    • 21. Help me switch out of the old system
    • 22. Tools for Training
    • 23. Identify the Gaps in your system and turn them into opportunity
    • 24. Test with my partners
  • 25. Our (condensed) wish list:
    • Direct integration with Social Commerce Platforms – share your database –
    • 26. Automated, reminder, wholesale system for preferred partners/vendors
    • 27. Interactive way to interface with our customers – Tracking system for the item purchase to its social justice cause, providing a call to action
    • 28. Aggregation of orders to increase purchasing power, meet minimums
    • 29. Instant perks/loyalty program not based on discounts but points that could be used with partners, like minded business
    • 30. Easy way to share our customer demographic with each other
    • 31. Free Project management tool with less steps –
    • 32. Free Secure/HR compliant Intranet where employees get information, share ideas, schedules, etc
    • 33. Payroll – direct API
    • 34. Communication tool that plugs into our CRM (customer leaves a message, text us, etc) or EMR
    • 35. Legal expertise, multiple lawyers for one monthly price
    • 36. Investors