Thursday, September 26, 2019

I Have No Credentials But I Do Have a Stack of Musicland POs

So, I know the title of this blog is Semi Entrepreneur and for the most part, I want to explore the concept of the 21st century entrepreneur, but, hey, it's my blog so I get to digress when I want.

For this entry, I'm gonna go into the wayback machine and tell a story from my early days. I suppose it does tie together with the theme in some regards in that I was very green and completely making up the rules as I went along (still do, in fact).
Image result for im making it up as i go

I previously mentioned that I had started Palisades as a marketing firm in the fall of 1994 (25 years on my own this very month!). This was the summer/fall of 1997 and South Park had just come on the air and was a huge hit. Sidebar: I definitely was on the chain that received a ratty VHS copy of The Spirit of Christmas. If you are unsure what that is, it's a must watch:

Anyway, many of the specific details have been lost to the abyss of time, but I was able to get a license (my very first license) to produce life-size cardboard cutout standees for South Park. Of course, "life-size" for these characters was about 36 inches. Interestingly, I learned that the way they printed the 6 foot tall ones is with two pieces of printed material. Usually you will see a tiny seam between the top and bottom halves.
We had also gotten a literal stack of Purchase Orders from Musicland. Remember them? Musicland/Sam Goody/Suncoast/Media Play. At the time they had about 1600 stores. Because this was a hot trend, they had us ship to each individual store, bypassing the central warehouse. Well, in those days that combination of factors meant that they cut us 1600 separate purchase orders! I literally received a large box filled with paper POs! AND.....they required us to invoice them 1600 separate invoices since every PO had a different PO number. To deal with this, I made a single invoice in my Quickbooks, but we typed in and printed out 1600 individual paper invoices using some Excel template. When I say "we," I really mean Kate, then my girlfriend, now my wife of 20+ years... We shipped them the box of invoices in the same box that their POs came in!

But the real "figure it out" part was: How in the hell am I going to actually produce and ship these things? I was three years in business, 28 years old, no credit to speak of--certainly not Business credit that would cover the manufacturing of thousands of these things. Like I mentioned, some of the details have been lost to time, but I do remember that the order breakdown had between 2 and 6 sets sent to every store, depending on the store size. So quick math: 4 units x 4 characters x 1,600 stores ended up being around 25,000 units. My cost must have been around $4 - $5 each, so call it an even hundred grand to make them. Then ship them. Then get paid.

So how did I solve this?

First, I somehow convinced Musicland to pay me on receipt of the goods instead of their normal Net 30 terms. (Ha! Net 30? Remember THOSE days?!). Part of the problem solved.

Then, I went to the printer. A guy I had not met in person but could do the work. Mr. Jimmy Cohn. He had a large printing facility in LA. I went out to visit him and told him my dilemma. We were at his home, sitting outside, talking about solutions. (Another funny aside: I distinctly remember this part of the story being the two of us having a beer and talking it over. I have since learned that Jimmy has been decades sober, including this time. So maybe I had a beer or I just invented that part...)

We agreed that Jimmy would print and ship to all the stores and my terms would be one day after I get paid from Musicland, I would pay him. I know we added a little bit to the unit cost to cover this risk, but really he was just trusting this kid with a stack of POs. The only agreement we had was a handshake and gentleman's honor.

The rest of the project actually went perfectly smooth (at least that's how I remember it). Jimmy printed and shipped. Musicland paid (thankfully, we got ONE check. I'm sure it was a check, too. No electronic payments in the 90s). I paid Jimmy.

I never produced this product category after that. We went on to do many millions with Musicland over the next decade or so.

Because I was out of the print biz, I kinda lost touch with Jimmy until Facebook. We reconnected, had a laugh, and I even took him over for his first China trip about 6 or 7 years ago. (We really just flew over together to HK and he had his own biz to tend to but I take credit for taking him)

Footnote to this story: Jimmy is still in the print biz, mainly focusing on packaging. Hit him up if you need innovative packaging/POS materials.

Monday, September 23, 2019

Network Marketing--Get over it!

Network Marketing--Get over it!

For a long time (seemingly forever), the idea of Network Marketing has been considered a negative model. And, frankly, it was. Or at least nothing to be taken seriously. When I think of this business model, it conjures thoughts of the old Tupperware parties from the 70's. Kinda harmless; more like hobbies that pay for what used to be called a housewife. So 1970's!

Moving forward a bit, it also makes me think of organizations like Amway. I have nothing against that company, but I don't have a glowing opinion either. (Honestly, I just had to Google it to see if they are still in operation. $8.8 Billion says that they are...).

But still, I always had this negative connotation from the model. Go sell some stuff but mainly try to recruit people to sell under you. Ye Olde Pyramid. 

Recently, though, I've done a mental 180 on this. Why? The primary catalyst has been my wife, who has recently gotten into the game by selling CBD. On the surface, it can be perceived as two scammy worlds colliding. But with only a small amount of research shows that I (and many others) have been wrong.

I won't spend much effort on the CBD part. What I will say on the subject is: do a little research. There are all kinds of misleading (in my opinion deliberately misleading) information on the substance. Is it the magical cure-all that it's often made out to be? Of course not! Mick Jones could have been talking about CBD back in the 80s! 

What I can say is, if you are interested, just make sure you know what you are taking. From completely fraudulent products (a friend was taking a product that clearly says in its description "Zero CBD AND THC") to confusing language to convoluted ingredients (saw some at our local grocery store that was full of additives and oils), it's simply a mess in that world. 

No, this post is more about the sales mechanism, now commonly called Network Marketing. Multi-Level Marketing is the same thing but with changing perceptions come changing identities. 

Are there still the basics? Levels of Associates who are selling the product and recruiting other people to sell? Sure, but I now look at the distribution system as it compares to traditional distribution. To put that same product on a retail shelf, the manufacturer would engage a sales rep (layer), distributor (layer), perhaps a local wholesaler (layer) before finding the retailer (layer). And that doesn't account for the rules of retail (markdowns, payment terms, etc.). It's simply using individuals who actually believe in the product to just talk about their own experiences. It's testimonials on a personal level. 

I'm not advocating that this is the perfect distribution system for ALL products. What I am saying is, this system, when paired with the right product, is utilizing modern communication tools of social media to have amazing reach. And I, for one, am changing my view along with the times. 

Tuesday, September 17, 2019

What is a Semi-Entrepreneur?

I suppose first and foremost, I should introduce myself and my background.

I'm Mike Horn, a 25+ year veteran of pop culture fan engagement. What does that mean?

I started my career somewhat traditionally by answering an ad in the newspaper (remember those?) for a buyer of trading cards at a wholesaler. This was the end of 1991 and I was a fresh college graduate, armed with an English major and no idea what I wanted to do. I ended up getting the job and was introduced (formally, more on my background on a later post) to the world of pop culture.

My job was with the largest wholesaler of comic books in the world, Diamond Comic Distributors in Baltimore, MD. Diamond was (and still is) in the business of supplying products to comic book shops. This was the early 1990s and trading cards were BOOMING. I was the fourth guy on a four-man team and my job was, initially, to deal with the trading card companies. I would gather as much information as I could and present that to the editorial team who produced the monthly catalog PREVIEWS, which both consumers and retailers used to place orders for their shops. After getting settled in, I expanded to also handle the licensed products (toys, posters, t-shirts, etc. All the products that you find a typical comic book shop that are not actually comics).

Fast forward about two and a half years, and, more than anything I was bored with the routine. (There's a longer story, but I'll save that for a future post.) Armed with the bravado of a 25-year-old and the wisdom of 30 months of career experience, I started my first business. Well, first, I spent the summer mountain biking in Colorado, Utah, and New Mexico...THEN I started my first business.

And I mention that because that is an integral part of my story and relevant to the title of this blog. You see, my very first entrepreneurial venture was not borne of some innate desire to create the ultimate business. Nor was it a Steve Jobsian desire to Change The World. No, I just wanted control over my life. And even more short term, my days. Keep in mind that this was decades before smartphones and constant contact in your pocket. I just didn't want to be regulated by a schedule that I didn't set.

So....What do I mean when I use the term "Semi-Entrepreneur?"

Moreso now than ever, I believe that there is a personality type that sits somewhere between the stereotypical Type A Entrepreneur and the Career Type. This is even the case in my own family! My oldest brother is a non-stop career entrepreneur, owning multiple companies and starting businesses as a hobby. The middle brother is an elementary PE teacher (approaching retirement). My career (and my life) is a blend of the two.

Whether it's a side hustle or just taking advantage of the Gig Economy, the notion of a "Lifestyle Business" is no longer some kind of insult. It's simply you taking steps to control your life!