Breaking Good: Growing Your Business
Small-business guru Barry Moltz hosted Breaking Good: Growing Your Business in 2014 at The NAMM Show. This hard-hitting NAMM U Breakfast Session addressed not only music retailers’ biggest concerns in the new year but also the not-to-miss opportunities.
Moltz was joined onstage by a think tank of independent music retail experts: Daniel Jobe of Friedman, Kannenberg & Co.; Ted Eschliman of Dietze Music; and John Pedersen of Pedersen’s Band & Orchestra. They offered a 360-degree video of the new business climate, exploring everything from online competition and Internet marketing to the economy.
“We call this session ‘Breaking Good’ because, quite honestly, it’s been tough over the last five years, and we really want to hit you over the head that 2014 is really going to be a great year,” Moltz said.
Highlights from the video:
On getting found by customers:
“We’ve done guitar shows,” Eschliman said. “You have an event where you bring somebody in. We do petting zoos with both local symphonies that we work with in Lincoln and Omaha. We try to develop a relationship that extends into the musical community there. Many of them are teachers. We try to go through the schools. We help out sponsoring with marching contests and help out with offering rental services—keyboards—for the district music contests and that sort of thing.”
“Petting zoos are incredibly powerful and draw lots of business,” Pedersen added. “We have a community symphony in Burbank that does concerts twice a year—sometimes three times. And they invite us to come and do these petting zoos. It’s a lot of work to drag your store over there and bring your teachers and demo instruments, but it’s probably one of the best relationship builders you can ever do.”
On generating cash:
“We have so much of our money tied up in rental inventory,” Pedersen said. “We’ve tried to think of ways to encourage people to do early buy-outs.
“We take this database of ours, we break it out by instrument, and we do early but-out incentives. If they wish to pay off their instrument early, we use Christmas and end of school. Those are the two times of the year when people make decisions. If they’re thinking about buying out, that’s when they do it. So we offer an additional discount for Christmas presents and the end of school. They’re waiting to find out if little Johnny’s going to continue next year. And if he is and we offer him a deal, we have a very high percentage of people that will convert to sale. This is how we get some of our money back.”
On establishing a good relationship with your bank:
“You have to be able to sell your business,” Jobe said. “You have be able to know and speak about your business. Because you know what you’re doing? You’re selling your dream to a loan officer. But here’s where the disconnect happens. You’re now relying on that officer to go to this little group that meets once a week called ‘loan committee.’ If this person, the loan officer, does not believe and know about your business, you have a very slim shot with a loan committee. So you have to find somebody who’s dynamic that you can work with that’s going to say, ‘I get you. We want to have a relationship with you. It’s a no-brainer. Here’s the money today.’"