Steve Simonson is a 29 year retail veteran! Who’s now on a mission to share his knowledge to help others succeed. Steve has founded, bought, built and sold multiple companies – including iFloor.com which became one of the largest direct sellers of flooring in the world. With those businesses he’s been publicaly recognized multiple times including 3 years on the Inc. 500 list, and multiple listings on the Internet Retailer Top 500.
Getting Started
Back in about 1996, Steve was looking around wondering what he could sell online. As a programmer who loved technology, he knew eCommerce was a part of his future, he just wasn’t sure how at the time. He owned a retail flooring store, but thought there was no way anyone was going to buy flooring online. However, after tripping over his samples in-store for a couple years, he decided to try selling what was physically in his building. In 1998, he tested his first experience with eCommerce by selling area rugs online. His very first sale was to Bulgaria, but the sale turned out to be fraudulent. However, getting people to place orders online and making sales even when he wasn’t around was magic to him.
iFloor
Steve grew the iFloor company rapidly at a reasonable scale, up to over 500 employees and over $70 million. He exited the company at around the $50-60 million range, which is typically when he gets annoyed with companies. Once he hits about $50 million, his eyes start to glaze over and he hates attending the meetings. At that point, it’s no longer a startup but more of a corporation.
Listen to learn about the different buckets a business can be divided into from zero to $50+ million, and what to expect at each range.
Zero to One Million — To Systemize or Not to Systemize
Steve recommends layering in systems as early as possible, as that will make the journey go much faster. However, in his practical experience, when people don’t already know about systems, they flail around until they get the next goal accomplished and the next box ticked off. It’s not until they hit a certain level that they realize they can spend some money on making a systemic solution instead of working so hard. Layering systems in is essential to scale, but it has to be balanced and in the right place and the right time.
To layer those systems in, find a pain point and build a system for it. Don’t bother with systems for one-time deals, but if it’s something that is causing frustration, has the pain point element, and is going to be repeated over and over, systemize it.
Listen to hear an example of too much systemizing when he bought a business and inherited their two-foot thick book of systems and policies.
Systems Technologies
There are many possible ways to handle systems. You can write SOPs (standard operating proceedures), create training mechanisms, use Evernote, Dropbox, or Google Drive, or use Google’s wiki-like system or any number of other similar tools. Steve recommends using the option that has the lowest barrier of entry for you. If you don’t like writing SOPs or get caught up in the literature of it, make a flowchart instead. Document it later and get it into a format that can be shared as your team grows, but to start with, pencil and paper work just fine.
Listen to learn about SOPs and when to introduce them to preserve the equity of company knowledge.
Tips for the Zero to 1 Million Stage
Start with your why. Why does this business exist, and how does it fit into your personal objectives? That narrows down all of the other reasons of why you do things. Your decision process becomes easier when you understand your why, because it gives you a concrete foundation.
After you know your why, stick to your knitting. Don’t get distracted by the next shiny object, but stick to your very basic premise. Focus on those simplest, most basic things, and don’t get pulled into a thousand little tactics and hacks. Focus on the core of your business, get your product online, generate awareness around your product, rinse and repeat until your concept is proven, and scale.
Test and Measure
Definitely test and measure your methods. On channels like Facebook, it may take you 20 or 30 different campaigns to figure out what works, but there’s no need to spend a ton of money every time. You can spend $5 to $35, see if your audience is engaging, test another one, and get good at it until you figure out who is going to buy your product. Once you know that, then replicate it across multiple advertising channels.
Listen to learn why Facebook advertisements are unique and why you should pay attention to them, and how to use what you learn on Facebook across other channels.
Organic Versus Paid Advertising
You don’t have a real business until you can pour money in the top and have profit coming out the bottom. It’s very unlikely that you will be able to generate a big business without spending money on advertising. In the old days, it was easy to rank in Google’s algorithm with SEOs, but now you have to just pay Google. Facebook and Amazon will move in that direction as well. Social media won’t just magically make things happen. Pour your money into the marketing funnel at the top to get profit out the bottom.
Your Own Website Versus Marketplaces
You won’t have a world-class brand if you’re in a single channel. It’s great to have your own brand and channel, and you can make that channel work. However, there’s no risk to getting your product onto marketplaces as well. Different customers are shopping in those different marketplaces, and if you aren’t in front of them, someone else will be.
Listen to learn about arbitrage and why Steve isn’t fond of the boutique model and recommends building your own brand instead of fighting with other retailers to sell someone else’s brand.
Seek Support
Entrepreneurs often get caught up in the day-to-day grind and end up feeling isolated and alone. Steve highly recommends that they find a tribe, such as the one Chloe is nurturing with this podcast, and interacting with your tribe to share tips and support each other. There is a whole world of people just like you. Support and help them as much as you can, because it makes things much easier and much more fulfilling.
You can hear about all this on the podcast, for free – right now…
Tool Top Tip
Asana
Growth Top Tip
If you’re not already in multiple channels, get into multiple channels. It’s shortsighted to be limited to your own site. If your product makes sense in one channel, chances are it will make sense in another without you having to learn new skills or make a new product.
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