A Good Thing Growing

22 | July/August 2021 | ALLPRO INDEPENDENTMallory Paint’s Jim Mallory and Juan Rios

A Good Thing Growing

Growth is a good thing. A flower blooms. A toddler takes their first steps. And businesses branch out. Many ALLPRO members have multiplied their operations, adding to their stores, and developing their business. And with each additional store comes various stories, words of wisdom, and cautionary tales from along the way. We connected with a few of our members to find out about their experiences with expansion.

SLOW AND STEADY GROWTH: DAGES PAINT COMPANY

When Anne Dages became the third generation of Dages Paint Company in 1994, she was committed to not just continuing the family business but taking it to the next level.

With a business degree from the University of Dayton and a couple years in franchise development for both a regional and national chain under her belt, Anne had all the tools in her toolkit to expand when the time was right or the opportunity arose.

“I joined with the goal of growing,” Dages says. “[I wasn’t] really sure how that would look, whether we could grow with one store, or if we would need to expand. I was not opposed to expansion, but by the time I joined my father, he didn’t want to take that on.”

While the company wasn’t in the business of big or multi-store expansions, they did have experience growing and developing the start-up at a steady rate.

Anne’s grandfather started Dages Paint Company in 1930 during the height of the Great Depression, selling paint from the trunk of his car. As his business grew, he moved his operation into a house where he sold paint out of the living room and did office

work in the kitchen. This space was soon too small, prompting him to establish his first “official” store. Dages Paint Company outgrew this location and in 1939, moved into a larger building. When Dages’ father joined the family business in the early 1950s, the father and son team built a store large enough to house their growing business.

In 2016, with Dages at the helm of the business, opportunity came knocking and it was her turn to grow the business. Not only did she remodel the original store and add Benjamin Moore paint, but she purchased two Hikes Point Paint & Wallpaper stores.

“There was another independent [retailer] locally who was always very supportive of me,” Dages details. “We never really saw each other as competitors. We saw more of the big boxes in the national chain as competitors, so we worked together as independents. He always kind of joked and said, ‘Oh, when I retire, are you going to buy this from me?’ And I said, ‘Yes.’ And then not really putting a timeframe on that, he called me and said, ‘Hey, I’m ready to retire, do you want to buy?’ It was such a great opportunity for me because he had a very well-established business.”

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According to Dages, she knew from past experiences in franchise development that it was easier to take over an existing successful business than it was to start a new one.

“I was very fortunate in that I was able to keep the majority of my key employees from the stores that I had bought,” she says. “And I worked very hard with the previous owner to set it up so it would work. So that way when I purchased, there weren’t customers who saw a big change. They saw the same people they had seen in the same stores. They just weren’t used to seeing me so I was kind of the only thing that changed.”

In that respect, Dages says her own role really didn’t change either -

she was just operating on a larger scale.

“My expansion wasn’t that scary,” Dages reveals. “I was doing the same thing I had been doing for so long, in a city that I knew. And we had many, many shared customers and I was known in the industry. It wasn’t like starting over.”

With her kids now in college, Dages says her expansion days are over, but adds, “never say never.”

“I don’t plan on opening any more stores,” she details. “But if my children come in as the next generation, I would encourage them to expand it, because this has been a very good thing for us.”

EXPERT IN EXPANSIONS: JC LICHT

With more than 44 company-owned stores in the Chicagoland area, JC Licht is an expert in expansions. According to Vice President of Retail, Sharon McGuckin, the independent paint retailer runs like a well-oiled machine when it comes to acquisitions and new store openings because everyone on the team is responsible for a piece of the puzzle and knows what is expected of them.

“We do not reinvent the wheel every time,” explains McGuckin, referring to JC Licht’s expansion process. “We wrote a playbook and we stick to it. Six weeks out, we know exactly what should have been taken care of and who is responsible for it. There are always going to be some unexpected bumps, but you have to anticipate them and act quickly.”

McGuckin stresses that store growth for the veteran retailer wasn’t always this smooth. In fact, when she first started at JC Licht, minutiae but essential details easily fell through the cracks.

“It’s really important that your people own their pieces because it’s overwhelming,” she says, explaining that she’s in charge of new store signage and marketing but that other team members are delegated with tasks that fall under their umbrella of expertise.

The business was first started by Jacob Licht in 1907 and is now owned and operated by Elliot Greenberg, whose vision for the future includes strengthening the can-do, service-oriented company culture, reinvesting in the business and its employees, and continuing

Purcell’s Paint and Wallpaper

24 | July/August 2021 | ALLPRO INDEPENDENT

Dages Hikes Point Paint & Wallpaper

to expand products and locations. Currently, JC Licht has their sights set on opening new locations in summer and fall 2021, however supply chain issues due to COVID-19 have made things complicated. Despite the challenges, the team veered off course and found resources to meet their deadline.

According to McGuckin, one very critical part of their process includes everyone getting together and contributing to the end goal. “The weekend before an opening, it is all hands on deck. There are always things that don’t get done so everyone including the CFO and his team shows up in jeans with a toolkit.”

And while opening a new store is nothing new to these seasoned pros, McGuckin says that it’s important not to put the expansion as the priority if it hinders the success of existing stores, staff, and patrons.

“It’s okay to pause,” McGuckin advises. “We have taken pauses along the way. There were times we felt we were going too fast and if we didn’t slow down, we would damage our culture. It’s very important that we ‘make it happen’ for our employees and customers every day. If a new store opening is going to negatively impact that by pulling resources away from existing locations, we pause until we are ready. Living our core values is more important than adding a new location.”

The team understands both the risks and rewards involved in expansion and is always prepared to modify operations for current and future developments.

“We always have a post op meeting around a month after opening,” details McGuckin. “We discuss what we may need to change or what maybe didn’t go so smoothly and how we could have done better.”

THE ROLLERCOASTER OF RAPID GROWTH: MALLORY PAINT STORE

If there was a record for the expansion rate of an independent paint retailer, Mallory Paint Store would definitely be in the running. Jim Mallory opened the doors to the first location in 2006 with the goal of owning two shops. Fifteen years later, Mallory Paint has well surpassed the initial goal, with 20 stores up and running in Washington State and Idaho.

Mallory is the first person to admit that the quick expansion came as a surprise, especially after struggling to open his second store in the middle of the 2009 recession.

“On top of the recession hitting, it was a lot of work, and a portion of the income, so you’re taking a big hit,” Mallory explains. His perseverance paid off and by 2011, Mallory purchased four existing Benjamin Moore stores.

“That was kind of a milestone game changer,” Mallory says. “Overnight I went from about six employees to 50. And you can’t micromanage 50 employees, I learned that really fast.”

When operating one or two stores, Mallory was doing it all and had

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his hands in everything - doing the books, working long hours, and overseeing his staff.

“I did not like my job when I was managing 50 employees, and I knew that I either had to grow or I needed to revert backwards,” Mallory admits. “We chose to grow - we were able to put substructure underneath us and layers of management.”

The owner credits his expansion success to both the people and the stores that he has working for him.

“I was lucky that we had some good employees. And it’s really all about employees,” he details, adding that post-recession, two of his stores were also doing well financially. “Those stores helped fund my growth, because you need people, and you need money to be able to grow.”

In 2010, with established employees and retail revenue, Mallory made his biggest goal yet: 20 stores by 2020. “We picked up pace and in April of 2020, we opened our 20th location in Monroe, Washington.”

With such high target goals, Mallory put an expansion procedure in place. “It’s all about the model. All of our stores are very similar,” he explains. “When we open a store, we do all the work ourselves. My soon-to-be-manager helps me with the work - they’re in charge

of it - and it actually gives them some ownership in that store. So, when they’re grinding floors, painting, and everything that you need to do to open a store - installing the shelving - they’re learning, but they’re also taking some pride and ownership of their store.”

With his 20-store goal achieved, Mallory is setting his sights on a new number. “Thirty-six stores by 2026. It’s a very aggressive goal,” he says. To find new store locations that will meet his lofty ambition, Mallory has criteria that he looks for, including building size, neighborhood, and market demand for Benjamin Moore paint.

“My model is basically an alpha-type of location - it’s street front on a busy street,” divulges Mallory. “We’re usually very close to the freeway entrance on ramp or off ramp everywhere we go. We pay top dollar for rent. We try to stay away from the big malls, so I’ll do a small strip mall, or I’ll try to do an individual building. If you do the big malls, you kind of get buried in there and nobody wants to come in and shop.”

Once a new space is secured, Mallory Paint Store’s team follows a very thorough checklist, everything from phone lines to signage.

With all the items checked off the long list of to-dos, Mallory can finally focus on his next feat.

“36x2026 - a yard ahead!”

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Expansion Advice From The Experts

“One big thing I’ve learned is, you’re better off putting a store on your way to a high demographic market than necessarily putting the store in the high-income market, because a lot of those people pay painters to paint and the painters don’t live there.” - Jim Mallory, Mallory Paint Store

“If you’re opening a store in a new market from scratch, you just really need to have patience with it. It can take a couple years to really establish itself, so you can’t overreact when things start a little slow. But if you’re acquiring a store, I think it’s key to develop really good communication with the existing employees, establish that you’re going to take care of them and not just go in and make drastic changes. I think it’s important to involve everybody in the process.” - Josh Johnson, Johnson Paint Company

“Great employees are a must. And partnering with vendors is something that has helped us. Vendors want to work with companies who are growing and loyal. Also talking with people who have done it. ALLPRO is such a great forum for these points. You can meet key vendors, executives, and experienced dealers large and small willing to share.” - Matthew Rossi, Rossi Paint Stores

“Check your bank account and make sure you can afford to lose money for a few years. Everyone always thinks if you build it they will come – that does not happen. My biggest piece of advice would be that without the proper personnel, just say no. People are what make or break your business.” - Anthony Ward, Farrell-Calhoun

“I am never afraid to ask for anything because all they can do is say no. And most vendors don’t say no if they can make it happen. Tell them you’re expanding stores and they will give you a special - one time buys for expansion. Even though I was an established vendor at my original store, when I was making a buy for the two new stores, I was able to get those first-time buyer specials.” - Anne Dages, Dages Paint Company

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