Selling a Pawn Business Is Complicated Selling a
Rus Krause Pres/CEO
Humboldt Pawn and Trading Company
“I want to sing my own personal hosanna for Jerry, who cleaned up our town and rode off into the sunset about three weeks ago. Here it is:
My three sons and I have a single store on the California coast, which has grown beyond our shoot-from-the-hip management style. We needed new and better systems and more understanding of our financials, but it seemed there was never enough time in the day to tackle it. It was as if we were trying to steer our ship from down in the engine room, hoping we were still going in the right direction. My dream for this business is that it will continue to be a source of connection and opportunity for future generations of my family, but we needed help.
When we contracted with Jerry to visit us in February of 2010, we had three months to prepare. We took that time to make changes we knew we needed so that Jerry could focus on things we didn’t know about. Just knowing he was coming lit a fire under us and led to so much progress, we got our money’s worth before he even walked in the door! But the best was yet to come.
Jerry is a numbers guy. He went over our financials with us for the last 4 years, showing us exactly what was happening with our loan and inventory yields. Like a lot of single store operations, we were in love with our profit margins and misunderstood inventory turns, which tells how much you actually make on your inventory. And we were sitting on gold, which hurt our inventory performance even more.
Jerry understood that our connection to each other as a family is very important to us, but there are always family dynamics in every family business. He fearlessly, tactfully and effectively navigated those waters, and our family is stronger, as well as the business, because of Jerry’s help.
We spent a lot of time on the showroom floor, going over layout, fixtures, and merchandizing. It was a little embarrassing. Did we really need to display every single rope and figaro chain we owned, or all 23 of our sawzalls (each one tagged in a different place)? Chainsaws in the front window? Oh yeah, that’ll bring the ladies in, for sure. Stocking new product when we can’t get enough used? What a concept! We’re a busy store, but that’s a pretty lame excuse for the neglect we were inflicting on ourselves and our customers.
On Jerry’s last day with us, he gave a motivational presentation to our entire staff, sharing much of the information he’d gone over with us owners. We have a great staff, and it’s important to us that they have opportunities to meet their personal goals here. That’s not always money, but money helps, so we drafted a productivity commission program with Jerry that was part of his presentation. The effect on our team was electric, that they could be in charge of how much money they make. We’re still hammering out the details of this program to fit our store, but everyone is energized and we already see improvements in customer service.
Although Jerry is a business consultant, we came to realize he has a higher calling, to use his special talents to help make the world a better place. He reminded us that the pawn business gives us privileged opportunities to help people in need, and there are times when there’s no money in it; it’s just the right thing to do. He certainly left our little corner of the world a better place than when he came. If you are considering bringing Jerry to your store, I recommend doing it soon. He’s very generous with information on the NPA forum, but it’s no substitute for the real thing. It might be the best money you ever spent”
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