David Singer, the President of Warehouse of Fixtures, grew his company’s revenue from $3.6m in 2014 to $9.4m in 2017, a 161% increase, and now they are on track to hit around $9m this year.
Warehouse of Fixtures is St. Louis’ premier location for new, refurbished and used office furniture at affordable prices.
In this interview with Eversprint‘s Malcolm Lui, David shares how he and his team accelerated their high value by:
- Hiring the best sales people to find and qualify leads.
- Bringing on board the best customer service and fulfillment team members.
- Doing business with clients who understand and appreciate their vision.
Malcolm Lui: Welcome to the High Value Sales Show of Eversprint.com. I'm Malcolm Lui, the Managing Member of Eversprint, and today we're speaking with David Singer, the President of Warehouse of Fixtures, St. Louis' premiere location for new refurbished and used office furniture at affordable prices. Welcome to the call, David.
David Singer: Thanks Malcolm.
Malcolm Lui: David. You grew your company's revenue from $3.6 million in 2014 to $9.4 million in 2017, a 161% percent increase and this year you're looking to hit again the $9 million dollar mark in 2018. But before I ask you about how you grew your company so fast can you perhaps share what your company does beyond my description and also describe how your company differs from the competition?
How Warehouse of Fixtures differs from the competition
David Singer: So our focus is New used and refurbished office furniture and that focus differentiates us from our competition especially because the level of service that we offer with the product. So I've always viewed my company as a service company even though we're very product heavy. We provide a level of expertise and design and layout help that you won't get from other companies and also typically when people think about used or refurbished furniture they think less then they think OK we're going to get this and then it's our problem. If anything is not right with the furniture that we deliver we make it right. And if there are problems we work through them with the client. So that's really the point of differentiation between us and our competitors. Either they're afraid to offer used used furniture or they don't offer the same level of service and expertise that we offer our clients
Malcolm Lui: Fantastic over the past few years you grew your company really fast. What were the three biggest drivers of your sales growth.
David Singer: I would say that the three biggest drivers of our sales group growth have been people people and people.
Malcolm Lui: Okay and are the three categories of people who helped you do this
David Singer: Yeah I would say so. I think that in you know I've had a vision for the company since I started it to be the best in industry and to be the best in industry we needed to have the best salespeople we needed to have the best service people and we need to have the best clients. And that's really the three three groupings of people that I would say allowed us to grow that quickly.
Malcolm Lui: Okay
David Singer: Really it starts with R.. It all starts with sales so attracting the best salespeople and making sure that they are really happy with us then making sure that we have the fulfillment side behind them to make sure that they're providing excellent service to our clients and then going after clients that understand who we are as a company and appreciate who we are as a company that really makes the difference because if we had crumb if we just accepted it and client that walked in the door and let them treat our people like garbage then we'd lose the good people.
Malcolm Lui: Right. Kim So just to recap the three categories of people that really drove the sales ultimately of your business because they all work together would be one having the best salespeople for your company and that fit into your vision. Again having a people who on the fulfillment side and customer service side who again who are in line with your vision and ask the clients as well who appreciate your company and what you're hoping to accomplish working together with them downright
David Singer: That is exactly it. And I think one of the big differentiators when I look at successful companies and companies that aren't as successful is I really view my salespeople as my customers so when I see companies that are just kind of not really doing well. You have owners that don't want their salespeople to earn more than them. You have owners that are always messing with commission plans you have owners that are trying to get their sales people to fill out stupid reports that aren't really what they should be doing or get their sales people to do all the back end work. And you're never going to attract and retain the best talent that way. So we've been very intentional about making sure that our salespeople get to do what they do best which is sell and take care of their clients.
Malcolm Lui: What sort of systems do you have in place to help your clients help your sales people sell and take care of clients
David Singer: Are you talking about I.T. systems or just how how we do it.
Malcolm Lui: How you do it the processes you have in place the marketing that you may have in place to help generate leads and prospects but then the follow up with whatever you do whatever processes you have in place not necessary I.T. process not necessarily I.T. system but just the processes that help your sales people sell more
Their sales and marketing processes
David Singer: So our industry in general is kind of an older industry. You'll see a lot of owners in the it's not a sexy industry you know people don't go to college and say I want to go into office furniture and they sure as heck don't get out of college and say I want to go into used office furniture so the people that we're competing against generally have kind of an older mindset they're in their 50s they're in their 60s maybe they're in their early to mid 40s which is an older I'm just saying that they tend to have a mindset that's a little bit different than mine which in 2008 we realized that we were never going to be competitive with the larger firms if we were doing yellow page ads and you know cold calling it just wasn't going to work. So we took all of the money that we were putting into the yellow page ads and put it into a fantastic Web site and started putting our inventory up there and investing in SEO and paper click. So that brought in a lot of leads and we continued to do that and continued to improve our web presence and are continuing to do so. We also hired a marketing person that helps us with that and helps us with online advertisements remarketing geo fencing all kinds of things that more traditional office furniture businesses aren't looking to do. And it allowed us to focus our marketing dollars a lot better towards people that were actually looking for what we were doing.
David Singer: So we get those leads and tell them to our salespeople and it's our sales people's responsibility to go and qualify or disqualified leads. Okay. Are these people looking for what we provide. Can they afford what we provide. Are they going to be a good client for us. Are they going to appreciate our services. And once they've done that and done a needs analysis what they do is they take that and they give it to someone in our design department and our design department basically takes the floor plans and does space planning and helps pick finishes and figures out the best way to reuse the client's existing materials. They're their furniture whatever assets they have and then proposes solutions. And those people are working directly with the clients so that the salesperson can go on to the next opportunity while staying involved in the strategy of the sale. So after they get the sign off on the proposal they take that and they hand it to purchasing and purchasing takes care of that making sure that the materials come in the customer service and scheduling dept. takes those materials that are coming in and make sure that the customer gets it within their timeframe and that if there are any issues they're resolved. So it's basically allowing each one of the departments the sales the design the customer service the purchasing to do their function really well. And then move on to the next one.
Malcolm Lui: Right now. How do you track everything make sure everything is going on going very well.
David Singer: We have multiple ways of tracking things. We do it through a spreadsheet system right now we're in the midst of developing a new ERP for our for our company that we think will help automate some of our processes but we have a spreadsheet and a workflow process right now that works really well.
Malcolm Lui: Fantastic. Yeah I took that talked to just another CEO just a couple days ago and he has a dashboard that built on a spreadsheet as well right. We're talking about how you know you don't need to have all the fanciest tools and systems right. Sometimes yes. Can I just work with the basics and work on what really matters and that's good enough to grow your business rapidly
David Singer: You know what it at some point you need to make sure that whatever you're doing is scalable because we've reached a size where some of some of the things that we're doing involve just way too much double work or manual entry so we invested this past year in a pretty robust ERP system based on Great Plains and Microsoft Dynamics that will automate a lot of the systems that we currently are doing manually. And that was important to me especially because it's so hard to find good talent. So rather than you know if I if I get a good salesperson they might bring in two million dollars of sales or a million dollars of sales. Well that would mean that I'd have to hire a designer and that would mean I'd have to hire another third of a person in customer service. So there's this kind of it was a linear growth that the more revenue that came in the more people we need to hire and each one of these departments. And that's really difficult. So it's been one of my quests over the past couple of years to find ways to automate those systems and make sure that what people what our people are doing are actually things that add value to the client and they're not just worthless backroom backroom processes they're adding to costs but not necessarily adding to what the customer's getting.
Malcolm Lui: Right. Right. Yeah another CEO I interviewed he did something very similar as you are doing now. I keep it up but about back office system that was scalable and just allowed the salespeople and other members of the team to do the work more efficiently and effectively. And I think just like he found with you not in the scale without adding a linear number of staff at the same time. So it worked out really well for him.
David Singer: Well I'll let you know how it goes after we're done
Malcolm Lui: Ok. Yeah. So you've given me more details on how you're hiring the best salespeople. And you also gave me some details. Our composition just now about that about the fulfillment side of your business and how they work to help grow your business. How about finding clients who understand and appreciate your company and your vision. How do how do you go about doing that. I know your sales people are involved a bit on the filtering aspect but is there more than that
David Singer: Yes. So our biggest method of finding new clients is referrals if if you do a fantastic job for your clients generally you're gonna get referrals. But we've taken it even further than that and it's based on kind of a philosophy that I have about building a referral network. So I am in addition to running the country I sell about a million and a half of office furniture every year. And in addition to that I've opened up some of the biggest accounts that we have. Myself and the way that I've done that generally is by finding people that are dealing with the same clients that we are dealing with ahead of where we are in the process. So who is talking to the same people that we are talking to directly before we're going to need to talk to them. Does that make sense
Malcolm Lui: Yeah. Does
David Singer: So in our case those people are moving companies commercial realtors architects and designers sometimes bankers and attorneys and accountants but generally the movers the commercial real towards the designers and architects are in there directly before we need to talk to those people
Malcolm Lui: Right. So you're building up a network of these people. Why. The ones who are working with your potential clients who don't who don't need you right now but they're going to need you after they move for example or they're going to need you after the architects designers have designed the building and now they need to start thinking about filling the building with furniture.
David Singer: Correct. And generally those warm referrals have a much higher close rate than if I'm just calling someone out of the blue and saying hey I see that you're building a new building you need office furniture. I'm Bob with office furniture company. This is Hey Bob. Or pay whatever your name is client Dave Singer is the guy to go to for this and I think you should deal with him for these reasons. So basically I have we have our referral sources pre qualifying our clients for us
Malcolm Lui: Nice. Can you share how you're going about building your referral network.
How he builds his referral network
David Singer: You know I go out and meet with a lot of people and the people that I meet what they say Hey who are your best clients. Who should I introduce you to. And a lot of salespeople are saying well I need people that are moving. OK. Well that's a great person to introduce me to as well. I need someone that's moving but I'd rather meet somebody that's meeting all of the people that's moving that are moving. So when people ask Who should I introduce you to I say movers commercial real tours and designers and architects. So I funnel almost totally to that and whenever I'm working on a project and someone is involved in it that I don't know I make a point of introducing myself to those people. So that's how we've met the people that are referring us business when we were first starting it was Hey who are the best people in all of these industries. And then it was Hey who are the best people in these industries that are dealing with the clients that we know are our best referrals because not all clients get what we do or want. What we do so we need people that really are looking for value. And if you're going to the highest end design firm and saying hey we sell new used and refurbished office furniture they're gonna shake your hand and say oh great to meet you but you'll never get any referrals from them because they're not dealing with the people that you need to deal with they're dealing with very high end people that want to spend a lot of money.
Malcolm Lui: Right
David Singer: So we're looking for people there people in those industries that are dealing with clients that really understand value
Malcolm Lui: Right. OK. Now how are you finding people in your referral network. Is it. And are you proactively reaching out to all the commercial realtors in St. Lewis.
David Singer: Yes we are. But generally when we do that we do it through introductions and not through just cold calls. Also there are industry associations so commercial real tours have the CCI M and the essay O R which are two industry associations. There's also the building owners and managers association. So if you get active in those things you're going to meet real tours versus going out and just cold calling him and saying hey Bob with office furniture company it's a lot easier to meet people through getting active in an association and actually doing work so that they can see who you are and what you do. Another way that I've been really successful in building my network is I'm very charitably active. So if you're on a charitable board with someone or on another association with someone you don't go and ask them for business but they see who you are. They see what kind of person you are what kind of work you do and what you're interested in and you're much more likely to get get business out of those people than if you were in a straight networking group.
Malcolm Lui: Yeah. I have a common interest as well.
David Singer: Yeah. You know I was at my kid's soccer match and I saw someone wearing a logo for a company. We'd done business with in the past and I said Oh that's so funny we used to do business with those guys but everyone in the department that we were dealing with ended up leaving for one reason or another. And she said you know what. My boss was just asking me if I knew anyone that did what she would do because we had let everyone go in that department and we need someone to work with. So you know just being out there and being aware you you get a lot of opportunities in that company is probably going to do one hundred thousand dollars worth of business with us in the coming year.
Malcolm Lui: Nice. Now before you talk about your ERP system and getting Microsoft an annex platform in as part of the picture to create systems the processes that are scalable but what you outlined to me doesn't sound that scalable right because it is a function of your time your your hours a week you're doing all these things. So how does that factor into your mind the scalability at building your router or network in this manner.
Their scaleable marketing
David Singer: So the referral the referral networking play is a long play. It's not a short term play. The Internet work that we're doing the advertising we're doing the geo fencing around places that we know that we really want to build our business. Those are more scalable expanding geographically by buying a company that had a Kansas City location was more scalable. But you know before you can scale you need to have systems and processes that will work at larger scales. So we are building up our sales and hiring I have 15 salespeople that are out there doing similar work to what I'm doing and as much as we try to build the referral networks. We're also looking at companies that we know are good fits for us. So companies that have multiple locations with complicated furniture needs that. We know we better than anyone else. And then calling on them or trying to figure out how we can get referred in
Malcolm Lui: Right. Okay. Got a couple a couple legs working couple of levers going on here. You have your pro network. You have your sales people proactively going reaching out buying business and you have great internet marketing as well
David Singer: Yes. And that gives us that gives us different types of sales which are really useful because a million dollars sale is great but when you're only working on million dollar sales your revenue goes up and then it goes down. What we've done is we've. We have kind of a retail sales network where people come in and buy you know twenty eight hundred dollars one hundred dollars two hundred dollars of stuff and then we have our contract sales where you know I have one client or one one salesperson that works with all of the universities and does two million dollars worth of business. I had one salesperson and one designer that have one account that does between 2 and 4 million dollars of business a year so it's it's good to have the different segments of business. Also because you can work at different margins.
Malcolm Lui: Right. Now this year is gonna be a flat year for you. What's happening what happened this year that resulted in a flat level of sales.
David Singer: Well there were a lot of interesting things that happen this year. Our first quarter and first six months of the year were down. And that's really why we're flat. So and we were hearing industry wide that that that was happening but I think we also had some we had some growing pains. You know we had some operational issues that that were going on where our sales team wasn't probably as confident in the operations as they had to be. So in addition to the industry being kind of down in the first half of the year we had some internal issues that needed to be resolved for our sales team to really be able to go out and knock it out of the park. So when we look at sales and process we have three million dollars of sales in process right now and we're budgeting for 15 million dollars of sales in two thousand in nineteen but none of that would have been possible if we hadn't have figured out some of the internal issues that were really holding us back.
Malcolm Lui: Can you give us a brief summary as to what the biggest issue that was holding you guys back.
David Singer: We were looking for the right person in an operational role to manage scheduling and customer service but really over all of operations in the business. So what was happening was we had someone in that role that was good for probably six or seven million dollars but wasn't ale able to scale scale the that department to do 10 or 15 and when when we hit that wall and we knew that wasn't the right person we brought someone else in and within three months I knew that someone else wasn't the perfect person for the job. So we replaced him with a new person and the new person was fantastic. And as soon as the sales force got got it in their head that OK now we can sell and move on and we're not going to have to worry about following up to make sure that everything was perfect that the customer service team the scheduling team the warehouse team is really on it. They sales just exploded.
Malcolm Lui: Right. Yeah I can imagine it. You don't want to sell something to a client and not have it be delivered because that's going to spoil the relationship. They're not going to do business with you. You rather kind of deferred slow it down. If anything
David Singer: Yet the sales teams. When I talk about the sales team being my customers if they're not confident in what we're doing in our ability to fulfill they're not going to be selling at capacity
Malcolm Lui: Yeah yeah totally understandable.
David Singer: Long
Malcolm Lui: I did it thinking long term right. They don't want to work with a client and make promises that aren't kept right because they might not ever do business with you ever again.
The relationship side of their business
David Singer: Absolutely and we are very much a relationship business. Like I said most of our business comes in through referral. And as much as I've talked about building referral networks the client referrals are huge. And returning business is huge. It's so much easier to take care of the clients that you have and keep those clients than it is to go out and get new ones. So we really take that very very seriously
Malcolm Lui: Yeah definitely. So for 2019 you mentioned just now that you're looking targeting 15 million for sales. So that's be a nice increase from around 9 million in 2018. And what's your plan to get there from 9 million end of this year 2018 to 15 million next year
David Singer: Well we acquired a company in September and that acquisition I think is probably going to add between 2 and 4 million dollars in sales. In addition to that we have one very very large client that we position ourselves extremely well with over the past year that I am guessing we'll do somewhere between 3 and 4 million dollars in sales across the U.S. and Canada in two thousand and 19. So I think to I think 15 million is not going to be that difficult to hit. I think we could blow it out of the water. We really did a great job.
Malcolm Lui: Right. So what do you think you'll be your biggest challenge to hitting the 15 million mark. I know you have the acquisition of the company that you're looking to add 2 to 4 million and then you have potentially one large client to do another 3 million to 4 million. Are those done deals in terms of their revenue contributions are there some challenges that you or your team need to overcome to make it happen.
David Singer: There are always challenges. You know we we relied very heavily on vendors. So if you know if we have a vendor that doesn't come through for us that's our reputation on the line. And so at any time we could lose a client based on something a vendor not keeping their word. So we have that we have we have other people there knocking on the same doors that we are. And just also keeping keeping the wheels on the bus doing acquisition is really difficult. We have a very strong culture here and we brought in some people that come from a different culture. So there are some rubs there and getting people used to working with one another and making sure that they understand that hey you know this guy's not trying to be a jerk he's just he communicates very directly. So you need to understand how he communicates. So there are lots of challenges there are lots of things that could get in the way you know everybody is saying Hey the economy's going to tank in the next year. So there's a lot of fear around that too.
Malcolm Lui: Right how about marketing and sales challenges to get to your target for 2019
David Singer: Marketing and Sales challenges that's an interesting question. I don't really I think in our industry right now because things are going so well. Marketing and sales are the easiest thing is that we have going on
Malcolm Lui: Okay.
David Singer: I'm more I'm more worried about operations I'm more worried about cash I'm more worried about keeping my people happy. You know if I had those things behind us and they were all taken care of and I could just say okay let's sell as much as we could. We'd be a 20 million dollar company.
Malcolm Lui: Right so what's it gonna take to get your operation sorted out get in your cash flow the way you want it to be. Keeping people happy.
How you can sell yourself out of business
David Singer: Yeah. I mean up new business owners don't often think about it in terms of that thing they think sales sales sales sales sales and they should because really nothing happens without sales but when you've been in business for a while you realize that if you sell and you don't deliver. Like you said you lose clients. You realize that if your sales grow by you know we're talking about 60 to 80 percent sales growth next year. Okay. Where's the cash going to come from. How am I going to support that from a cash standpoint and how am I going to support that from a operational standpoint from a I.T. standpoint from all of these different things. Once you get to be a more established business you understand that all of those things are super important because you can sell yourself out of business you can be the most most profitable business in the world and sell yourself out of business if you run out of cash
Malcolm Lui: Right and I say interesting trade sell yourself out of business
David Singer: It happens it happens all the time you know when we have this client that's going to go from selling two million were with two million dollars a year to four million dollars a year. Everybody's patting themselves on the back and I'm talking to the bank. I'm talking to the vendors. I'm doing everything I can to make sure that we're going to have the cash to support that
Malcolm Lui: Right
David Singer: Because our vendors are coming to us and saying hey you're you know you have a million dollar credit line and you're now pushing over that. How how are you going to pay for this it's it's fun. There are new challenges that every one of these milestones
Malcolm Lui: Yeah definitely. I don't think people fully understand the cash flow implications side of things until they're actually in the middle of it. As our now
David Singer: Yeah yeah. We I got a you know I think most business owners week side is financials so I got a financial coach not a financial advisor but a business coach that focuses on financials. A couple of years back and if it hadn't been for that I think it's likely that we wouldn't be in business because managing cash flow through that type of growth is incredibly difficult.
Malcolm Lui: Yeah how much. How many months of financing do you need to carry. In terms of you know buying inventory waiting to be paid by your clients
David Singer: So especially because larger clients ask for longer terms. We if if we place the order on day one we might not get paid in full until day sixty or seventy five
Malcolm Lui: Right. That's quite a bit of interest cost to pay in as well as a waiting for them to pay so that you can pay back the bank and pay all your bills and your vendors and even everyone else as well
David Singer: It is and you have to build all of that into your margin and you have to build it all into your plans and it it can get a little overwhelming sometimes.
Malcolm Lui: Yeah. And you'd have these unexpected unforeseen issues right. As you said if the vendor doesn't deliver. If your customers for whatever reason doesn't pay on time. Kind I can throw it can throw everything out of whack easily enough
David Singer: Yes. When you're when you're playing with that big numbers it's really easy for something to go wrong and in our industry you know we have part numbers and one missed key in part number could cost you a million bucks.
Malcolm Lui: Yeah don't make that don't make that fat finger mistake.
David Singer: No not at all and you're you're right. If if there's an issue on the order it also pushes out payments. So it's there's so much to think about when you're working with this type of growth. It's a lot easier to stay stagnant. But to me I think about it I think that if I'm not out there growing and getting better and leveraging my relationships with these vendors to increase our discounting and making sure that other people aren't coming into my market with better discounting and beating up on us then we're we're just waiting for somebody that's smarter and more aggressive to put us out of business
Malcolm Lui: Yeah yeah. You definitely have to keep on improving your game. Right to stay relevant.
David Singer: Yes very very much. So it I look at some of the people in this industry that were the biggest and are now out of business and they just got fat and happy and they weren't pushing the envelope they weren't being creative they weren't taking the best care of their people. And guys like me that came in and said I'm going to I'm gonna be the best. Knocked them off
Malcolm Lui: Yeah there's always someone is always the number two that want to be number one right.
David Singer: Yeah it's like the gunslingers right
Malcolm Lui: Yeah. They always want to be the fastest to ask questions for you David. Who are your ideal customers and what's the best way for them to contact your company
Their ideal customers
David Singer: Are ideal customers are companies large or small anywhere across the United States that have complicated furniture issues or have multiple locations and want someone to be able to manage the furniture and all of their locations that value service and value price. So probably somebody that is shopping for cars and looking at used cars or looking at lower lower cost higher value cars like Toyotas or Hondas. People that understand that there's no residual value in their office furniture so they can either spend another ten thousand dollars on their office furniture or they can take their family to Disneyland. So the best way to contact us is through our Web site. W w w dot S T L warehouse dot com that's w w w dot S T L as an S. Lewis warehouse W A R E H O USC dot com or via our phone number 3 1 4 5 3 4 5 9 0 0.
Malcolm Lui: Lot. David for joining us today and sharing how you accelerate your company's high value sales
David Singer: Thanks Malcolm.
Malcolm Lui: We've been speaking with David Singer, the President of Warehouse of Fixtures about his company's rapid growth. For interviews with other fast growing high value sales companies, or to learn how we can accelerate your firm's high value sales through automation, visit Eversprint.com.
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