In all the serious textbooks you’ll find that “pedagogy” means child learning and “andragogy” means adult learning. You’ll also find that in general terms, the experts believe that children learn best by “being told” and adults learn by “doing”.
Maybe, maybe not: but I know that I learned a vast amount about business by simply observing my father in his business. And by having his business all around me until I married and left home at the age of 26.
Here are the major things I learned.
Are you familiar with the book “Positioning, The Battle for the Mind” by Al Ries and Jack Trout? It was first published in 1981. I believe that it’s one of the finest marketing books ever written. It’s still in print.
My father practiced “positioning” for all his business life. His target market was small “lolly shops” and “milk bars”. They catered particularly for children with small amounts of many to spend. Officially, he was known as a “wholesale confectionery distributor”. But the only products he sold were what he called “kids lines”. Lollies and sweets made especially for kids.
If you’re old enough, you’ll remember going into such a shop with a quarter or a dime or a penny or the equivalent. You’ll also remember the open boxes of lollies or “sweets” at say, a cent or a penny each or three or five a cent or a penny. You’d choose from a large number of open boxes and try to get maximum value for your sixpence or five or ten cents. The shopkeeper would take your selection from the boxes and place them in a small bag. You’d take the bag and pay.
Today you buy such lollies in supermarkets prepacked in bags of ten or twenty lollies.
Dad specialized completely in selling “kids lines” to small shops. The shops were usually family businesses. He didn’t sell chocolate bars or candy bars or boxes of chocolates. He concentrated on selling “kids lines” to specialist shops that were frequented by children.
That’s how I learned the importance of a clear business focus, a narrow well defined target market and a very specific product. He never mentioned either to me or my brothers or sister. But we knew. Al and Jack merely confirmed, decades later, what Dad had practiced.
I decided to start my own business in 1978. I discussed my plans with my accountant. His was a very successful business that he’d built over a decade. He’d started with only a handful of clients. He himself was quite wealthy.
“What are you doing it for, Leon?” he asked. “To make money, of course,” I replied. “Don’t be silly,” he answered. “anyone can make money. What would you like to be able to do in 10-15 years time that you can’t do now?” I thought for a moment: “I’d like to know a lot about Australian food and wine,” I replied. “OK,” he said. “Do it for that. You see, you must have a purpose for being in business independent of the business itself.”
I can’t claim to be an authority on Australian food and wine. But over the last few decades, I’ve eaten some wonderful meals and tasted some outstanding wines.
My father understood this idea well. He ran his business so that he could afford to take us on two weeks holiday at the seaside each Christmas and a week each Easter. My mother also enjoyed musical theatre. Dad ensured that they saw all the big musicals when they were produced in Melbourne.
He worked to ensure that his business made enough money to provide holidays and theatre visits for the family. This also meant that my sister and I had swimming lessons from an early age. And I saw a stage production of Irving Berlin’s “Annie Get Your Gun” when I was only 9 years old. These sorts of things pleased my father greatly.
Almost every time Dad stopped his vanload of sweets and lollies outside a shop, he’d attract an audience of kids. Many knew who he was and what he sold. They’d mill around the open back door of the van anxious to see what to them must have seemed shelves stacked with boxes of gold.
Dad never told the kids to go away. He realized that they were the eventual consumers of his “kid’s lines”. He’d say, “Look but don’t touch” or “Leave some room for me”. But he never gave a lolly away for free. Had he done so he would have been competing with the shopkeepers, his direct clients.
The kids who hung around the back of the van were mostly boys. Dad called everyone “Jack”. “Keep away from the door, Jack,” he’d say or “You can buy these right now in the shop Jack”.
He was most surprised one day when a boy opened his eyes very wide and said to him, “How did you know my name was Jack?”
Knowing What You Don’t Know
Small, family run businesses were Dad’s focus. “Kid’s lines” were his specialty. He knew relatively little about chocolate, candy bars and boxes of expensive lollies aimed at the top end of the market. He didn’t care that he didn’t. He was never distracted from his core business and his target market.
People often said to him, “Clem, with customers all over Melbourne you could expand your business by selling all sorts of confectionery. But he stuck to what he knew. He was frequently approached by confectionery makers who wanted him to carry their “latest big thing in confectionery”. He resisted their approaches and their blandishments. He knew what he didn’t know. He trusted his customers. They trusted him.
Buy Everything Else Around The Corner
One of my favourite business sayings runs like this: “Do only those things to which you bring a unique perspective. Buy everything else around the corner”.
Dad put his personal stamp on his business. As kids growing up we learned this very quickly. He would tell us stories about how other “jobbers” – that’s what wholesale confectionery distributors were called then – had branched out into other confectionery associated areas, expanded their product ranges and expanded their business.
But Dad knew something else that Al and Jack pointed out decades later. Line extension is often the first step along business failure road. Do what you do best; better than anyone else can do it. “Stick to your knitting” as the old-timers used to say. I’m not sure how Dad learned that himself. But he followed the principles religiously.
I wasn’t born until 1939. Dad graduated from selling lollies from a pushbike. First, he bought a horse and cart. He had no affinity for animals. There are many family anecdotes about his trouble with his horse. Before I came along in 1939 he bought his first van. It was a Chevy, about the size of what we’d call a “combivan” today. In 1956 he replaced it with a large van. He also built a large storeroom behind our home.
The bank he’d dealt with since he started business was reluctant to support the construction of the storeroom and the purchase of the large van. Dad was disappointed. He wasn’t stopped. He changed banks.
Dad worked long hours. His work was physically demanding. He carried stacks of boxes full of lollies from van to storeroom to van to shop. But he tried not to interfere with shopkeeper’s busy periods. He’d start calling on customers around 8 am. He’d stop around 7.30 pm. As he worked many years before seven day trading became commonplace in Australia, he worked only Monday to Friday and Saturday mornings.
He’d visit manufacturers to purchase stock during the middle of the day. That suited them. It also meant that he avoided interfering with shopkeepers’ daytime trading.
His long hours didn’t always please my mother. But they pleased his customers.
At festive times such as Christmas and Easter, Dad always tried to have special stocks readily available for customers. At these times, he’d put aside special chocolate gifts for my sister and I. But customers come first.
I still remember customers phoning at say, Easter, begging for chocolate Easter eggs because they had no stock left. He’d always do what he could to help. This included asking my sister and I if he could “buy” our eggs from us and resell them. He’d pay us for the purchase. We always agreed. We had access to all the lollies we could eat. As kids we welcomed the cash!
A Few Other Things
Dad started and ran his business from 1930 – 1971, when he retired at the age of 72. The pocket calculator, Mac, PC and cell phone to say nothing of the iPad and iPhone were barely glints in Steve Jobs and others’ eyes.
But he needed to do complex calculations every day. He was an absolute “whizz” at what was then called “mental arithmetic”. He used imperial measures such as pounds and ounces, dozens – 12 – and the gross – 144. Decimal currency wasn’t adopted in Australia until 1966.
But none of this bothered my father. He could mentally calculate say, one gross of acid balls at 2/6 a dozen – two shillings and sixpence – less a volume discount of 2.5% and a discount for cash of 1.5%. He didn’t need a calculator or any other device in his pocket. They didn’t come into general use here until the 1970s.
He didn’t make calculation errors. He could always explain his calculations to customers in their terms. That was another reason that they trusted him. His handwritten invoices, completed at the point of sale, were legendary.
Dad was never bothered by “hard times”. He believed, as he put it, “mums, dads and grandparents will always find a few pennies so that their kids could buy lollies, even if they themselves have to go without”.
The Real Lesson
I learnt a lot about business from my father. But I can’t ever remember him saying, “You need a crystal clear business focus and a clearly defined target market” or “Make sure that your customers trust you” or “Don’t compete with your customers” or “Have a purpose for your business other than the business itself”.
I can’t recall any specific advice from him about running a business. But I learnt all those lessons by watching and listening.
It might pay to ask yourself
- What lessons do my employees learn when they watch me?
- Is what I say entirely consistent with what I do?
- What do I say and do to show them that I trust them?
- Do I bring a unique perspective to the business?
“Lead by example” may sound old fashioned. But it’s still a worthy guide.