In 1978 Bernie Marcus and Arthur Blank were executives of "Handy Dan" part of Daylin, Inc. Their division, Handy Dan, was making lots of money, while Daylin, Inc. was going bankrupt. They were suddenly fired!
Before they were fired, Marcus and Blank, had been experimenting at Handy Dan's by lowering the prices on some items. "They observed that when they marked down items, volume increased and costs as a percentage of sales decreased." From this successful idea they developed their step-by-step plan of action. They decided on Atlanta as their store location. Then they located two large empty stores and put on the shelves 18,000 products from plumbing, hardware, electrical, paint, and lumber.
They charged close to 1/3 less for each item. Marcus and Blank selected and trained their employees to "deliver the best customer service". They chose knowledgeable salespeople who knew about their products and were able to answer customer's questions, and direct them to the best equipment for their needs. Their expert salespeople were able to tell customers how to do the work.
Their store had everything that a homeowner or contractor needed to do their repairs under one roof for the lowest price possible.
On the first day that they opened their store, Marcus and Blank gave their children $1 bills to give out to customers as a thank you for coming in. By evening, 5pm or 6pm, their children were in the parking lot giving out a $1 to each person they could convince to come into the store.
Blank said, "It was a crushing disappointment."
Marcus said, "It looked like curtains for us. My wife wouldn't let me shave for days. She didn't want a razor in my hand."
On the third day, "a satisfied customer returned" bring with her a thank you gift of "a bag of okra for Marcus" for helping her solve her problem.
She gave them hope and then "word of mouth" brought more customers into
Marcus and Blank's, "The Home Depot" store.
Today, The Home Depot has 371,000 employees' worldwide. They sell hardware, plumbing, lumber, tools, home appliances, electrical supplies, paint, flooring, building materials, and gardening equipment and supplies. In 2014, Home Depot earned $78.812 billion in profit an increase of over $4 billion from 2013.
What are the three things you can learn from Bernie Marcus and Arthur Blank about stepping-stones into success?
1) Remembering their successes with lowering the prices on certain items and saving in purchasing on volume, Marcus and Blank wrote up their step-by-step plan of action. They located two empty large buildings stores in Atlanta. On the shelves they put 18,000 products from plumbing, hardware, electrical, paint, and lumber. They charged close to 1/3 less for each item.
2) Trained employees to "deliver the best customer service". They chose knowledgeable salespeople who knew their products and were able to answer customer's questions, and direct them to the best equipment for their needs.
3) Their stores sold homeowners everything they needed in one store and their expert salespeople told them how to repair it. Contractors were able to find everything they needed in one store for the lowest price possible. It was a "Do it yourself' store.
If Bernie Marcus and Arthur Blank hadn't been fired at "Handy Dan's" they would never have created "The Home Depot" and helped employ all these people worldwide giving them good jobs to take care of themselves and their families. Their store was a how to do it store that housed all the products needed under one roof for homeowners and contractors. Their store filled a need!
Napoleon Hill said, "Most great people have attained their greatest success just one step beyond their greatest failure.
Prime Minister Winston Churchill said, "Never give in, never give in, never, never, never, never-in nothing, great or small, large or petty-never give in except to convictions of honor and good sense."
So the next time you fail at something, remember the failure of Bernie Marcus and Arthur Blank and how they responded to failure by developing a new plan of action to develop their "Do it yourself" store.
By the way, have you ever heard of "Handy Dan's" before this article?
Don't let any failure stand in your way, let it be your stepping-stone to success.
Madeline Frank, Ph.D., DTM, John Maxwell Team Member, and Certified World Class Speaking Coach is an Amazon.com Best Selling Author, sought after speaker, business owner, teacher, researcher, and concert artist. She helps businesses and organizations "Tune Up their Businesses". Her innovative observations show you the blue prints necessary to improve and keep your businesses successful. She writes a monthly newsletter "Madeline's Monthly Article & Musical Tips Blog" and a monthly radio show "Madeline's One Minute Musical Radio Show". She has just published her new book "Leadership On A Shoestring Budget" available in print or as an e-book. To contact Madeline for your next speaking engagement