Franchising as a (Highly Structured) Entrepreneurial Option: The Case of Mike Luna and McDonald’s

 

As the class learned yesterday–from a long-time practicing McDonald’s franchisee–franchising can represent a special type of entrepreneurial venture. No one probably knows this better than Monmouth’s McDonald’s franchisee Mike Luna, who has been with McDonald’s in some capacity almost continuously since 1960. As Mr. Luna told the class, he opened McDonald’s store #154; of the roughly 35,000 the company now has around the world. Learn more about franchising at McDonald’s at the link below.

http://corporate.mcdonalds.com/mcd/franchising.html

One thing we learned by sharp contrast yesterday was the vast variety in level of structure—inversely, the level of freedom to do exactly as one pleases—within entrepreneurism. Previous guest John “Beefy” Huston dropped by as an “audience guest” yesterday. As Mike Luna talked to the class about the various corporate rules he is contractually obligated to abide by as a McDonald’s franchisee the point came up that we were probably witnessing the bi-polar extremes of structure faced by entrepreneurs; “Beefy” Huston who pretty much does as he pleases and Mike Luna who must abide by a long list of corporate rules (in place to ensure the success of individual McDonald’s stores). Nevertheless, both entrepreneurs love what they do and are highly successful in the Monmouth area.

Enough from me… Class blogger Landon Walker tells us more about Mike Luna’s story of franchising as an entrepreneurial opportunity below.

Have a nice weekend!

Prof. Gabel

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Last Thursday, our Midwest Entrepreneurs class had the opportunity to gain insight from Mike Luna. Mr. Luna is not the common entrepreneur around the United States. He is what we call a “franchisee”. Mike has been a McDonalds franchisee for a long time and is very skilled at what he does.

Mr. Luna has been around McDonalds since he was a teenager. When he was 16 he was working at a McDonalds in Galesburg, Il. Mike later went off to school, but eventually made his way back to McDonalds. Mr. Luna had the opportunity to buy into a store in Kewanee, Il. He took the opportunity and learned lots before opening his own store. He now owns a store in Monmouth, Il that he opened in 1990.

Mr. Luna credits most of his learning from a longtime friend he calls “chief”. Mike also learned lots from being a part owner of the store in Kewanee before selling his share to open his own store. Although Mr. Luna enjoys owning his McDonalds in Monmouth, Il, he does express the cons to being a franchisee.

When buying into McDonalds one must pay $45,000 every 20 years to the organization. Every year the franchisee has to pay at least 9% of earnings (depending on where the store is located) to the organization. Each owner has to go through what is called the “3 legged stool” system. This is where the McDonalds corporation decides what the suppliers/distributors carry and then the owner has to buy supply from the supplier. The corporation decides what stores will look like, what machines are used, where the store is located, and even what wallpaper is in the store.

Mr. Luna treats his employees well and, in turn, he expects his employees to treat the customers well. Mike described the importance of customer base as “you can’t run a restaurant without people”.

Mike Luna is a great example of an entrepreneur in the United States. He has taken risks all throughout his career and continues to work hard and succeed. He stated in class that he has finally started taking two days off work a week. This should give an idea of how difficult it is to be a successful entrepreneur in the world today. Just like Mike, if someone works hard at whatever business they so desire, it will have a chance at taking off. You just have to take the risk to find out.

Landon Walker

Susan Schuytema and Market Alley Wines: Creating a “Third Place” in Downtown Monmouth

by Midwest Entrepreneurs Student Christopher Tworek

This past Tuesday we had the pleasure of listening to Susan Schuytema tell us the story of her journey as a successful entrepreneur.

Susan originally started working at the age of thirteen and had several jobs throughout her life ranging from a struggling journalist to an usher at Wrigley Field to a airport security worker to a very busy and stressful marketing job in healthcare. She is a very outgoing person and prides herself on her love for the people she works with and for; her employees and customers. Susan is an extremely wonderful person with a lot of pride in her business (in what she calls “her baby!).”

What was really interesting about Susan was her willingness to work hard and never give up. She constantly wanted to go out and make a living. Yet for quite some time she was not exactly sure what she wanted to do; so she did a bit of everything.

However, journalism only took her so far. She was not able to make a good living and had to work other jobs to make ends meet. Soon after being fed up with this reality, she got into marketing in the healthcare sector. This was much more income savvy for her. Yet she was not satisfied. She did not like doing this. She wanted something more. Soon after she married her husband, Paul, and with him they brainstormed what now is known in Monmouth as Market Alley Wines.

http://marketalleywines.com/

What was intriguing about Susan is her consistency with what she recalls as “the three places” that everyone needs in life. “Those three places,” she exclaimed, “are your home, your work, and the place where you go to congregate, usually on the weekends or after a long day at work.” This third place is where Susan saw her opportunity to make a living and become a successful entrepreneur.

Susan and Paul brainstormed about what type of business they could set up. Together, with the combination of the Buxton Retail Report—commissioned by the City of Monmouth to show what locals were going out of town to buy—and Susan’s love for wine, they researched and discovered that Monmouth had a real market for wine. Susan had previously studied abroad in France. There she fell in love with what she and others call ‘the language of wine.’ So they decided to open up a wine store.

Through some financial support from her mother and confidence from her family she had made her passion for wine a reality and opened up Market Alley Wines in June of the year 2011. Market Alley wines is located in downtown Monmouth, Illinois. It is a small yet very popular and successful business.

There is a very homey and comfortable vibe when you enter Market Alley Wines. They sell hundreds of different types of wine from several distributors. They also have sales in a variety of craft beers, wine accessories, gifts, and some home decorations. Recently they have gotten into the fast growing bourbon business. A lot of the customers that come to Market Alley Wines are women. Yet she welcomes all people to her store and tries to have something for everyone. As I mentioned before, Susan wanted Market Alley Wines to be that “third place” that people go to unwind and socialize; a place where “everyone is welcome and equal.”

People do not only come there for the wine, the bourbon, or the craft beers. A lot of customers travel to Market Alley Wines for the live music that is played every Friday and Saturday night. Her husband is the person who pushed for the live music every week. Susan loves the idea of live music and her customers thoroughly enjoy it.

Market Alley Wines is open until 6:30 Tuesday – Thursday and 7:00 pm on Friday and Saturday. Due to the ever growing crowds of people every week for music they have recently upgraded their seating to nearly double of that at which it was previously. You are also able to host events at Market Alley Wines. These events range from bridal showers to retirement parties. She is very involved in her community and is very credited to her community involvement.

To wrap it up, Susan is extremely friendly woman who loves her community and the people in it. She has no problem hosting benefits and prides herself on her special skill which is remembering every face that she sees in her store. She wants you to be a part of it. Market Alley Wines is her baby, she will never let it go.

Christopher Tworek

Working to Live (Instead of Living to Work): The Enlightening and Entertaining Entrepreneurial Saga of John “Beefy” Huston

Many times over the course of roughly 20 years of college/university teaching I have advised students to strive for the goal of “working to live (rather than living to work).” I also advise them that achieving this goal does not come easy; it requires dedication and lots of very hard work both during and after their formal educational experiences are over.

Being an entrepreneur—as opposed to working for others—is of course a particularly appropriate path for those hoping to “work to live rather than live to work.”

Yesterday, students in the Midwest Entrepreneurs class heard from a guest speaker that I believe epitomizes the hard-working entrepreneur who works to live—and structures his business around his chosen lifestyle—more than any other speaker we have ever had in the class.

Our guest yesterday was long-time local landscaper John “Beefy” Huston; whose ongoing entrepreneurial saga is both enlightening and entertaining. It is enlightening in that it demonstrates that it is indeed possible—through entrepreneurship—to have a meaningful and enjoyable life. His saga is entertaining to hear told in large part because it at times so sharply contradicts common assumptions about “the imperative of business growth” and the “need to keep up with technology” as to be comical (in a very meaningful, positive, and enlightening way).

Enough from me… I turn things over to Marco Tawadrous to provide further detail on the entrepreneurial story of John “Beefy” Huston.

Have a nice weekend…

Prof. Gabel

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John (Beefy) Houston started his career on his family farm in the 90’s. However, things were hard for family farmers at the time and John decided to start doing landscaping jobs on his own. When he started his business he was only 24 years old. But even then he knew the importance of earning a reputation for being honest and always doing high-quality work. John is not a “cheap” person to ask to come do your landscaping. But he is the right guy you can trust and feel comfortable with because of his focus on doing things right.

Most of the time he starts work in March and ends around Thanksgiving. There is little that can be done in the winter so he travels extensively in the winter months.

Being an entrepreneur is right for John because he sees work as being something that should allow you to live out your chosen lifestyle to its fullest. John sees that life is not only for jobs and we live and die while we are working. He is that type of person that while talking to him you can see that he is the one that makes his work fit his life. Not all entrepreneurs can do this.

He doesn’t want his business to get bigger. For John, getting bigger is just more worries in his life to take care. He said that he can hire up to 10 employees in the summer but he chooses not to. Most of his workers are college students looking for summer work.

His philosophy is “what goes around come back around.” He means that when you treat people right they will treat you right in return.

He doesn’t spend any money on advertising unless it’s for charity. He trusts that the people will know his work because of referrals and because of the quality of the work he does.

John is a very organized person. After the employees leave the work site he usually stays and makes sure that everything has been done right. He also then prepares his equipment for the next day so that he doesn’t have to worry about it the following day. I believe that being so organized and detail oriented is one of the most important things that the entrepreneur should do.

John also advised us to “see and be seen locally in events, dinner, and games.” This means that as an entrepreneur in a small community like Monmouth you should always be aware of what is going around you and get to know more.

He also has a policy “if you will be five minutes late you should call” and let the client know. People always like to see that that type of respect and appreciate it. He also sends thank you letters to his customers after the job is done. It was not surprising to hear John say that he often does work for multiple members and generations of local families because they trust him so much.

Beefy wants to retire by the time he is 55. He believes that the harder he works now the less he’ll have to work later. He is a financially smart business person and consumer in that he always pays off his debts as soon as he can (and always before he has to pay interest!). He buys a lot of materials for landscaping jobs but he always takes advantage of opportunities to get discounts.

Overall, John “Beefy” Huston works for what can help him live his life to the fullest. He isn’t like some other entrepreneurs and business people that you hear about that are always looking for more and more money no matter what it takes to get it.

Marco Tawadrous

Will Zimmerman ‘11 and Modern Grain Systems: Building Satisfied Customer Relationships (One Grain Storage Bin at a Time)

Last Thursday in the Midwest Entrepreneurs class we wrapped up an early-semester mini-series of ag-related entrepreneurial guest speakers. This series—of four great speakers—had previously featured a retired grain bin storage services firm owner with over 65 years of experiences, a local “traditional production” farmer managing a 1,000-acre family farm, and the owner of a Galesburg-based specialty crop Community Supported Ag (CSA) venture.

The series concluded last Thursday with former Midwest Entrepreneurs class member—and 2011 Monmouth College graduate—Will Zimmerman; the inspirational young entrepreneur behind Modern Grain Systems (a firm that custom-builds grain bin storage buildings).

We have thus seen in a very short period of time a diverse glimpse into ag-related entrepreneurial opportunities that exist here in the heart of the U.S. Farmbelt. Although we have had but a glimpse into these vast opportunities I think it safe to say we have provided some enlightening insight into the variety and abundance of such opportunities that exist. Hopefully students have had their eyes opened to the fact that (1) a large number of such opportunities exist, (2) there is room for—and demand for—ag-related entrepreneurial innovation, and (3) farmers are indeed entrepreneurs (that run increasingly complex and risky businesses). I would be overjoyed if even just one student has been inspired to seek out, create, and pursue such an opportunity in the near future!!

With that said, I now turn things over to class blogger Micam Smith to tell us much more about Will Zimmerman’s ongoing entrepreneurial journey.

Enjoy…

Prof. Gabel

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Will Zimmerman, a former student of the Midwest Entrepreneurs class here at Monmouth College, came to speak to the class on February 9th. Will is the owner of Modern Grain Systems, a business operating out of Avon, Illinois, that builds and manages grain bin storage systems. He has been building grain bin storage systems since he was a sophomore in high school, until one day he decided to buy out the business he was working at. As a senior at Monmouth College, Zimmerman took an independent study to work on his business plan and at the age of 21 he successfully obtained a loan of $200,000 to buy Modern Grain Systems.

The previous owner of Modern Grain Systems, Bill Thompson, noticed the hard work and the knowledge Zimmerman enacted while working at the business. At just 18 years old, Will Zimmerman was head of his own crew building million dollar grain bin storage system set ups. Even though Zimmerman was very young, Bill gave him the opportunity to buy the business because he knew Will would keep the business operating successfully. Will took that opportunity and never looked back. He now owns a business reaching 4-4.5 million in sales.

The link below is a video Zimmerman used at the beginning of his presentation to show one of the early projects that his company successfully completed; an almost $900,000 job.

https://www.youtube.com/watch?v=9qELQMCDRtk

Will Zimmerman and his Modern Grain System business has about 20 employees that are mostly 18-25 years old. His business is responsible for building various size grain bin systems that can range from $60,000 to millions of dollars. In the summer during his busy operating period, Zimmerman claimed that he could work up to 100 hours per week or even every day of the week. With a wife and two kids it makes it hard to find a clear balance between work and family but Zimmerman has learned how to efficiently do both and become successful entrepreneur. You can even find Zimmerman working side by side with his employees on the worksite because he wants his customers to know that he values the quality of his firm’s work (and he wants his workers to know that he would ask them to do nothing that he would ask of himself).

Not only is the work Zimmerman does important to him, but so are the relationships he builds with his customers. Zimmerman spends no money on advertising for Modern Grain Systems. Instead, he depends on customer satisfaction-driven positive word of mouth for his business to operate and expand.

Operating within an hour radius of Avon because he doesn’t want to “bite off more than what he can chew.” So, it is important to focus on customer needs and expectations. Most of his work is repeat work, meaning many customers come back to Modern Grain Systems when they need more or need to update their gran bins. With his business having a slow growth rate—picking up just 7-9 new customers a year—it is important for Zimmerman to complete the job to fit the customers’ exact needs so they will come back and can recommend Modern Grain Systems to other customers.

The Midwest Entrepreneur class learned a lot from Will Zimmerman. One thing we learned is the important of both hard work and having set objectives. One of the most important objectives Zimmerman talked about having was “work as hard as you possibly can” and “spend money on something that has a return on investment.”

Will Zimmerman is not just a perfect example of a successful entrepreneur, he is a successful entrepreneur FROM Monmouth College and it was great having him speak in class.

Micam Smith

Dusty Spurgeon ’10 – An Unconventional “Farmer as Entrepreneur”

Yesterday in Midwest Entrepreneurs class we had our second “farmer as entrepreneur” guest speaker in a row; Dusty Spurgeon co-owner of Galesburg, IL-based Spurgeon Veggies. However, this “farmer as entrepreneur” is about as different as possible as last Thursday’s guest Paul Rickey. Dusty, as can be seen at the links below, runs a small-scale, highly specialized Community Supported Ag (CSA) firm while Mr. Rickey is a more conventional, larger-scale farmer producing basic commodity crops.

http://spurgeonveggies.com/

https://www.facebook.com/SpurgeonVeggies/

While the students witnessed discussion of the great differences between Dusty Spurgeon and conventional farmers such as Paul Rickey, they also heard that both are entrepreneurs running their respective businesses in the face of the some of the same risks (e.g., unpredictable weather, fluctuating seed and other material prices, and dynamic market demand).

Below, Midwest Entrepreneurs class member J.T. Seeley tells the story of Dusty Spurgeon and the ongoing growth of Spurgeon Veggies.

Prof. Gabel

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Seven years ago Dusty Spurgeon graduated from Monmouth College with a major in biology and a minor in chemistry. After taking a class called “Food for Thought” here, she got interested in the food industry and started to watch what she ate. She became particularly concerned about where the food she was eating was coming from.

Shortly after graduation, Dusty moved to Galesburg. Then Dusty’s mother-in-law sparked her interest in ag-related entrepreneurship when she asked her to join her in setting up a booth at the local farmers’ market to sell produce. About a year later, Dusty was formally involved in the Community Supported Agriculture (CSA) business.

Dusty started working with her mother-in-law in the business and got to know the ins and outs of the CSA. Even though Dusty wanted to stay away from school she sure did learn a lot in the few years that she has been with Spurgeon Veggies. Upon starting she knew little about gardening or farming and did not even consider the business to be a business. She mostly taught herself the way of the field. She not only taught herself farming but since becoming a co-owner she has had to learn marketing, bookkeeping, mechanics, and even small engine repair in order to run the business and make progress towards the future they hope to achieve.

Spurgeon Veggies is a unique business, very different from what we heard about from last week’s speaker Paul Rickey. Mr. Rickey is a more conventional farmer who grows corn and soy beans for sale. Spurgeon Veggies works not only with CSA but also has a spot at the Galesburg Farmers Market in order to sell their goods. Their goods consist mostly of vegetables, some fruits, and also eggs (that sell year round). One of their greatest advantages in the market and what sets them apart is the wide variety of specialized vegetables that they have. Their variety goes above and beyond what you can find in the supermarket, whether it be different kinds of vegetables or even the difference in the colors of those vegetables. Another advantage they have is that they try to limit the amount of pesticides used by incorporating other things such as rotating crops every year, self-composting, and using row covers. These advantages help them be successful in the Galesburg area and also to manage risk.

The future of Spurgeon Veggies looks bright. They have currently slowed expansion right now because they look at moving to a new location in the next couple of months to allow them more space. They are also looking to expand their CSA size along with increasing their capabilities of doing winter shares with investments in high tunnels and greenhouses. Another possibility is adding more meat to their products by adding more chickens or even getting hogs. One last look to the future would be to purchase another stand at the farmers market which the recent investment of a fridge trailer would allow them to do. The future looks bright for this company and its expansion.

Lastly, a special thank you to Dusty Spurgeon—and her mother—for coming and sharing the knowledge you have acquired with us!

J.T. Seeley

Paul Rickey ‘76: The Traditional Production Farmer as Entrepreneur (and Professional Business Man)

I am originally from a small, agricultural-based industrial town in SE Iowa; about an hour and fifteen minutes from here in Monmouth. I moved away in the late 1980s for graduate school and to “see the world.” Upon moving back to the region in August of 2012, I soon realized that no matter how many places however far off and different I had lived in or visited there was still a lot of this region “in me” that could never be removed or denied. A big part of this is the agricultural-based nature of the region and a big part of that is “the farmer”; who they are, what they stand for, what they do, and how they do it.

This realization of the centrality of the farmer to this region—and how it is a part of me—came crashing down upon me shortly after my return when watching the Super Bowl in early 2013 and seeing the unconventional “God Made a Farmer” Dodge Ram Truck advertisement—featuring the iconic voice of the late Paul Harvey—at the link below.

https://www.youtube.com/watch?v=AMpZ0TGjbWE

I played this ad—one that still resonates with me since first seeing it now four years ago–last Thursday to introduce our guest speaker in the Midwest Entrepreneurs class; 1976 Monmouth College graduate and long-time “traditional production farmer” Paul Rickey (who farms roughly 1,000 mostly family-owned acres near Monmouth). Farmers are—as expressed by Paul Harvey and as exemplified by Paul Rickey—anything but ordinary people. They do and endure things most people find unthinkable.  They are also—from the perspective of this class and on top of everything else they are— entrepreneurs managing businesses in a very professional manner in an increasingly complex and risky market environment.

Enough from me… I turn things over to Midwest Entrepreneurs class member Kyle Schultz to tell you—to quote Paul Harvey—“the rest of the story” on Paul Rickey; the Traditional Production Farmer Entrepreneur.

Prof. Gabel

 

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On Thursday, February 2, our class was blessed with an opportunity to listen to Monmouth College Alum, Paul Rickey ’76. Mr. Rickey had some great advice to share with us about how he made it through Monmouth College and moved into the real world where he became very successful.

Mr. Rickey’s farming story starts out way before he was born when his ancestors bought an 80-acre piece of land near Seaton, IL in 1847; for the price of $300 at the time. He described his farm as a “Legacy Farm” because his family still owns and farms on the original piece of land now 170 years later.

While Mr. Rickey was growing up, it was clear that he wanted to continue the farming tradition. He loved farming, and that is what he wanted to do.  He now farms close to 1,000 acres, but he doesn’t own it.  Mr. Rickey is a sharecropper, and he splits half of the crop with the landowner—his mother—and gets to keep the other half.  He chooses to do this instead of cash renting the land.  By splitting the crop with the landowner, he shares the risk with the landowner in case there’s a bad year.

So what is a good year for a local, relatively small farmer? Mr. Rickey was very clear about what a good year for him is.  “A good year for Paul Rickey is when he pays for 80% crop insurance and doesn’t need it.”  He explained that when he pays for 80% crop insurance, if yields drop below 80% from what is projected, the insurance company will pay for the loss up to 80%.  In order to have this kind of protection, he pays out a lot of money.  His share of the crop insurance costs him about $71.44 an acre.  That’s not cheap, but on some of his better ground, Mr. Rickey can get close to, if not over, 220 bushels per acre.  This number is way up compared to when his father was first farming.  Mr. Rickey said his father used to get right around 80 bushels per acre.  This is largely due the technological advances in the farming industry.

Mr. Rickey said that there were three things you need to do in order to be a good farmer. Number one, you need to plant and harvest your crops.  Number two, you need to mow your weeds regularly.  Number three, you need to keep your mouth shut.  (He mentioned he doesn’t do number three very well.)  As much as he would love to say that his farming skills are the reason his yields are better than his father’s, he just simply can’t.  Mr. Rickey is quick to credit the advancement of farming equipment/technology and new seed.  The new farming equipment and technology is just unreal.  Farmers are able to plant and harvest their crops way faster, more efficient, and easier than ever before.  There is GPS technology in the tractors and combines that allow the machine to drive itself.  With this technology, he always plants his crops in straight lines making it easier to later harvest.  After switching to the GPS Auto-steer, Mr. Rickey was able to harvest five acres more a day of soybeans.  He also credits GMO’s for his increased yields.  He explained to the class that the seed used today is so much more productive and durable than ever before.

Along with the advancement of farming technology and equipment, the farmers have also changed. Farmers today aren’t your stereotypical rednecks wearing bibs and a straw hat with half their teeth gone.  That is one thing that Mr. Rickey wants to be clear.  He believes in dressing very proper and maintaining a professional image. At the end of the day, Mr. Rickey is a business man. He has to meet with his banker to ask for loans.  If he doesn’t get that loan, it could be very difficult to finance his upcoming crops.  That is why he makes it a goal to always make his banker his best friend.  Keeping his banker happy is always a priority for him. It is important to him that he always maintains that professional image, and I think that is something we can all learn from him.

Paul Rickey’s visit to our class was truly something special. He is extremely dedicated to farming, and he loves it.  Every day, he gets to wake up and do something that he loves to do.  I hope that I can say the same thing one day.  On behalf of the class, I want to say thank you for taking the time to come and speak to us.

Kyle Schultz

Taking (Full) Advantage of a Special Partnership Opportunity: The Special Case of Erin Elliott and Specialty Retailer Maude Specklebelly’s

Our guest speaker this Tuesday was Erin Elliott; co-owner of specialty retailer Maude Specklebelly’s located in downtown Monmouth, IL (see: http://www.maudespecklebellys.com/).

The story of Erin’s entrepreneurial venture is indeed special in many ways; starting with the very beginnings of the business. Below, Midwest Entrepreneurs class member Kierra Russell provides further details of the special story of Erin Elliott and Maude Specklebelly’s.

Prof. Gabel

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On Tuesday January 31, we had the pleasure of meeting Erin, one of the owners of a small boutique located in downtown Monmouth called Maude Specklebelly’s. I found this business very interesting in many ways, including how it came about.

The fact that this business is extremely successful but that neither one of the two owners had any plans on building a business—or being entrepreneurs—right up until the start of Maude’s is amazing. Erin and her business partner—longtime friend Jaime Ballard—had never thought of running a business until about four years ago when an amazing opportunity presented itself. This opportunity was the City of Monmouth’s Retail Business Competition. The two decided to enter and crafted a business plan in just six days. They went for it and came out on top; winning a package of incentives to get the business up and running. Maude’s recently finished its third very successful holiday season and year of business.

I think that when starting a business it is important to make sure that you find a partner that has opposite strengths as you. Erin talked about how she was good with managing the business finances but her partner—a graphic design expert—wasn’t. If both of them were bad at managing money this business would have failed within its first year. Surprisingly, this company was more successful than expected.

I think that Maude Specklebelly’s is successful because the business partners actually took the time out to think about what was in high demand for the area. A lot of times I don’t think that people think that out. The fact that they are a unique boutique that carries items that you can’t find nearby is what keeps them going.

I think that these women had a well thought out business plan when they started up and this is what helps them keep being so successful. They have learned from their mistakes and are very smart with the decisions they make for their business. I would recommend stopping by Maude’s sometime soon because like Erin said, “We have something for everyone!”

Kierra Russell

John Twomey: A Grain Industry Pioneer

Last Thursday was our first guest-speaker appearance of the young semester. I think it safe to say that our guest–retired local grain storage services entrepreneur and philanthropist John Twomey–will be “hard to top” in many, many ways.

While all of our guest speakers could accurately be referred to as “role models,” John Twomey–now 93 years young–stands out as the quintessential example of a positive role model for the students; not only as an entrepreneur but as a passionate, caring, community-minded person living a long and meaningful life.

Today’s blog entry for this very special guest speaker is Midwest Entrepreneurs student Derrick Romano. Below, Derrick has done a fine job of capturing the essence of what was shared by John Twomey–and learned–in class last Thursday.  Enjoy…

Prof. Gabel

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A local retired entrepreneur—now 93 years of age—is arguably one of the most revolutionary icons in the U.S. grain storage industry of all time.

John Twomey started his entrepreneurial career following his service in the military during World War II.  Upon his return from India at the end of the War, he experienced his twenty second birthday amongst his crew mates. Just prior to John’s return from the military he received a letter from his father which explained his father’s feelings on the war. John’s father explained how he felt that there was no reason to celebrate for the end of the war because there was work to be done in the fields that said he was proud of his son for serving his country.

Following John’s return home to the area he decided to join his father in the family business and begin working on the fields. John returned home just in time to harvest the soybeans with his father. That was the beginning of what would be a more than 65-year-long career as an entrepreneur.

Throughout John’s career in the grain storage business he experienced both the highs and lows and the mediocre and the magnificent. When John first began helping his father in the business there was only enough room to hold a single barge full of grain. Within a short few years John’s family company moved onto the river and was able to fill 900 barges with grain.  John’s family business was primarily a storage for grain. So the Twomeys would purchase grain from other farmers or hold their grain and sell the product at a later date when the price was hopefully higher. In order to store this grain for long periods of time there were large tall cylindrical containers used to hold the grain.

In 1953 the Twomeys built a flat grain storage building. Three years later they received a loan to build another grain elevator. The company was building and building fast. They still suffered from the way they had to transport the grain from the containers to the barges. Then in 1973 a self-designed barge loader was built enabling the movement of more grain at more precise levels; therefore not losing out on extra expenditures.

Now at this point in the business things were moving way more smoothly, but they still had the issue of too much grain going bad prior to the selling days. When it comes to the taller cylindrical containers all the poor grain that is dropped in falls to the center and builds up and as John Twomey explained, it reacts the same way as a bad apple in a barrel the build-up begins to spread to the good grain soiling the whole batch. Mr. Twomey also explained that the most the grain could be damaged was seven percent or else it would not be sellable.

So in response to this issue John developed an innovative new way to store grain by using the flat storage buildings and making piles every six feet all the bad grain would be spread out and not spoil the remaining good grain. With this new method John was able to store grain in upwards of nine years, with very little spoilage.

Mr. Twomey claims that President Ronald Reagan was thought of as a business partner in his household. The reason being that right as John had begun expanding vastly by building 14 warehouses, President Reagan cut business taxes (to at a highest rate of 28 percent). This allowed for John to make roughly 70 cents on the dollar roughly rather than what would have been before around only 35 cents on the dollar at the previous tax rate. This allowed for more loans for buildings because all the bills could be paid off faster. John Twomey not only created jobs, which before his retirement was at around 85 employees, he also was able to better the lives of all the people he worked with and anyone who came to learn his model of grain storage. John Twomey was an outstanding entrepreneur and is a great man.

Derrick Romano

 

Racing Towards your Passion with Rod Smith

We saved one of the most interesting entrepreneurial business models of the semester for our final guest speaker presentation.

“Saved” is probably a bit misleading… It suggests some purposeful action on my—or our—part. This is not the case…

Rod Smith was our final guest speaker of the semester in large part because of three interrelated reasons. First is Rod’s high level of entrepreneurial success. Second is the fact that he recently purchased a beautiful “winter” home near Daytona Beach, Florida. Third, Rod was living there over the winter; nearly until the end of the Spring semester here. He returned to Monmouth just in time to graciously fill our very last guest speaker slot.

Back to “one of the most interesting entrepreneurial business models of the semester”…

Rod sells used Nascar racing parts on Ebay.

Maybe this does not sound like a “big time operation” or even a “good entrepreneurial idea”?… Think again!!

The entrepreneurial success story of Rod Smith is one of turning a hobby into a thriving business, creating and enhancing relationships, creating and taking advantage of opportunities, taking the right risks, and persistence.

Class member Marissa A. Abston provides further detail on this amazing story below. Enjoy!!

Prof. Gabel

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Mr. Rod Smith was the last speaker to visit the Midwest Entrepreneur’s Class for the spring semester of 2016. During his presentation he told us about himself, about his business venture, about his hobbies, and about what he’s learned throughout these experiences.

Mr. Smith is currently 61.5 years old. He is from Monmouth, IL. At the age of 53 years old he became a full-fledged entrepreneur. He told us that he was a partial entrepreneur until then.  Eight to 10 years ago he briefly worked at the Chicago Speedway as a Pit Stop crewman. At one point he used to work at Monmouth College as the head of maintenance. He did not get a college degree. One thing he highlighted was that he had taken up a hobby that paid for itself.

Mr. Smith works through E-bay. The easiest way to describe his job is as an independent E-bay vendor. He specializes in the area of motor vehicle parts – particularly selling used parts from NASCAR. The supply end of his operation takes place mainly in North Carolina, USA, where he buys the goods he sells directly from NASCAR racing teams.

As an E-bay seller, Mr. Smith is required to pay E-bay a percentage of his profits. In addition to E-bay, PayPal is a vehicle used for transactions. They send a form to the IRS if their user makes $20,000 or more. Most likely that procedure is to make sure no one is skipping out on their taxes.

He informed us that there used to be 300-400 people that did what he currently does. The difference between them was they weren’t turning in E-bay’s fair share of the profits. The IRS cracked down on many virtual vendors when the wave first began as E-bay and sites like it arose. Now, after several years, they have regulations and protocol in place to avoid cheating the system. He believes it pays to do business ethically. Seeing the consequences his former competitors met, it seems he’s got it right.

In his business he has never needed to take out a loan. Mr. Smith says that’s due to his good skills in money management. He recommended that we all wet our feet in it. I noticed that not many of our speakers have self-proclaimed that they are good with their money management skills. This is a good asset to have under one’s belt. It probably saves money to have more skills because then he may not need to have an advisor since he is already adept in how to handle that. Even so, he has taken on an accountant to help him keep it all in line.

Mr. Smith’s working hours vary from 6 A.M. to 10 P.M. He travels around the country collecting parts and in the process enjoys his hobby. In order to collect parts he needs a trailer, which may vary in capacity depending on what is being hauled. Usually he flies down to Charlotte, NC since he’s “older” now and will stay in hotels while he has someone drive his trailer down for him. Mr. Smith invites his friends to journey with him and pays them to pick up the parts as he does the transactions along the way. I thought that was a valuable lesson – take your friends up with you and it’ll be a more fulfilling adventure.

To efficiently conduct business he always has a hunk of cash on him to make purchases on the spot. He eluded to the fact that you never know what’s going to catch your eye until you see it. In this business, you don’t want to be caught unprepared. In addition to purchasing and supplying used parts, Mr. Smith also supplies pit crew guys for lower end/ranked teams because it is too expensive for them to afford fulltime-travel pit crews.

High-volume E-Bay sellers like Rod Smith get a lot of questions from prospective buyers. E-bay vendors are required to put in descriptive details about the items. Sometimes people want lots of information about the item and its origins. Many people fear not getting what they see in the picture when shopping on-line. Things like “How many main caps are you selling here?” and “Does the package contain the same thing displayed in the picture?” are asked often. So Mr. Smith opts to put everything that you need to know about the item in the description as soon as possible. In order to clarify what is being sold –for example– he will have a quantity of 5 items in the picture uploaded, a total of 5 items listed in the title, and will have a total of 5 items matching the picture and title exactly within the package. He gives a complete 100% guarantee on what he offers.

Mr. Smith always has very good feedback. Nobody has ever reported being unhappy nor dissatisfied with his items. The only responses he has gotten outside of good or excellent have been a total of 2 customers a year reporting that they are neutral towards his items. 1000s of customers report that they are happy and well satisfied consistently. Rarely will he sell items right out of his brick-and-mortar shop, but when he does it is usually to locals or those who are desperate to obtain a part.

Mr. Smith’s suppliers and customers both trust his character as a business man which furthers his reach into the industry and market. Due to that, business draws to him because people know they will get good quality. In some cases he must keep items for a minimum of 2 years before selling anything because of a deal that he made with the suppliers. Those are usually secretive products that the supplier wants him to wait on selling to test that he is trustworthy as a partner. Due to his integrity he passes those tests with flying colors, and goes on to do great business with them. His business has high demand all over the world. Mr. Smith is also brought business because others recognize this trustworthiness.

In addition to earning suppliers’ trust he ensures that his customers get the greatest offer by carefully examining whatever he is shown before purchasing it.  Sometimes he sells products for a higher price than he purchased it for because the item is so rare and can only be attained through NASCAR. Even so, he makes sure to never cheat his customers. Mr. Smith made an emphasis on the practice that he does not allow broken, dirty, or raggedy items to be sold regardless of the fact that he sells “used” pieces. He does his best to fix them up so that they operate as good as new or better. Then he sells it for a great price that is still cheap for the customer and profitable for him. There is a tool he uses often that cleans up even the greasiest parts they acquire. It appears that he is very fond of this tool because he boasted that it “works beautifully!” I believe that speaks to his character because he oozed the pride of a wholesome seller when he said it.

As Mr. Smith projected into the future, he said that they may need more workers down the road to keep up with the demand which is steadily increasing. Mr. Smith conveyed that hobby racers have increased despite the economy’s downturn. Such a trend helps his business grow. He told us that some equipment, such as engines, are much more difficult to transport. Occasionally his team has to take apart or split engines [or other major parts] in order to transport them. Tasks like that will eventually require more aid when he and his current helpers get older.

Following that he gave us a virtual tour of his winter house; it is very nice. Mr. Smith was pretty humble about it. One amusing insight was that he was nervous to touch anything inside for a while because he thought it was all too fragile. Though he enjoys his winter home Mr. Smith says he won’t sell his Monmouth home ‘for nothing’, he loves it here.

Another topic we shifted into was his two favorite hobbies. Mr. Smith likes golfing in his free time. He says it is a really nice pastime; especially in that southern weather. What he enjoys more is racing! He bought an entire racecar once from the UPS team at the end of a season. He told us that he raced himself [his times], but it hasn’t been for years. Mr. Smith would suit up his own cars with the parts he sold – he trusts what he buys. It’s the hobby that pays for itself [if you’re good at it].

Now he goes to car shows and engages in other ways. Local racers know him well. Instead of racing he has relaxed into driving an electric car and has only filled it with gas 5 times since he’s bought it. He found that amusing, because now he’s more interested in aspects that don’t involve him driving it although it’s a nice car.

After that Mr. Smith enlightened us that these things [our preferences] aren’t out of reach. He says it only takes 2-3 days to be taught how to create an E-bay business if that’s what you are interested in doing. Then he told us what he’d do different: Mr. Smith says if he’d lived in the Charlotte area he would have made a million dollars easily because it is flooded with racing fans and participants. But he’s glad he didn’t and he won’t because he doesn’t like the summer weather – it is north Daytona, too hot. Jokingly he also said it’s too easy to get lazy in that beautiful southern weather in Florida. Most of the class shared that sentiment with chuckles.

What is the biggest challenge Mr. Smith foresees? Getting older. A simple and straightforward answer. He says as time progresses it gets harder to get out of bed and start. He’ll never get bored with this, but he may get too tired to conduct business like he currently does – fully immersed in it 1st hand. So he’ll go with the flow and find a way to still go further with it.

Mr. Smith says this business has been a dream come true. In the past he thought he’d retire from Monmouth College at 75 years old. He would have been happy doing that. However, this turned out to be better and he is very happy with the results. Nobody tells him what to do now, but he does work with a team and they have to work better to have optimal performance. He left us saying “Drunk kids break stuff, it’s a part of the flow.” and laughed – that concluded our time with Mr. Rod Smith.

Listening to him, it is visible that you can go further in your career when you actually enjoy what you are doing. You are more likely to care about it and also more likely to explore how to do it better on your own time – it is no longer a chore. I think the essential lesson from our last speaker –Mr. Rod Smith– is that we can make a fulfilling life out of doing our hobbies as our occupation; work doesn’t have to be work.

By: Marissa A. Abston

Tim Wells ’87: “Find Your Lick” and Relentlessly Pursue your Passion

It is not often that one can honestly and accurately say that they are in the presence of someone who may well be among the best few in the world at what they do.

However, that is exactly how I felt last Thursday in the presence of Tim Wells, a 1987 graduate of Monmouth College. I suspected it the moment one of the students introduced himself to Tim with the words “It is a pleasure to finally meet the legend…” and it was confirmed for the subsequent hour and twenty minutes he was with us in class.

Tim is among the very best in what he does with regard to (1) “primitive hunting” (via bow and spear [note that he threw the javelin while a student at Monmouth College]), and (2) creating and running an entrepreneurial enterprise related to the pursuit of his passion for “primitive hunting.” In this regard, Tim (1) is the creator and host of the #1 bow hunting cable TV show in the world (“Relentless Pursuit”), (2) holds sponsorships with several major hunting product manufacturers, (3) sells a variety of hunting-related products via his personal webpage, and (4) is a major star within the world of hunting on YouTube (and other online venues). Information about Tim and his entrepreneurial ventures can be found at the links below.

http://www.thesportsmanchannel.com/shows/relentless-pursuit/

http://timwellsbowhunter.com/

https://www.youtube.com/user/worldhuntinggroup/videos

https://www.facebook.com/relentlesspursuittv

 

Another thing noteworthy about Tim’s visit is that while many of our guest speakers this semester have spoken about “pursuing your passion” I believe none have pursued and lived out that passion quite like Tim has.

The one thing that will stick with me more than anything else from Tim’s visit in this regard is his loyalty TO his fans/customers. Allow me to clarify… In business classes, we often talk of seeking loyalty to the firm and its products among customers/clients (e.g., via consistent meeting of customer expectations and the creation of meaningful and valuable experiences). It seems that Tim Wells has done such a good job of creating loyalty amongst those that follow him that he in turn feels an intense loyalty toward them.

This was witnessed most vividly when Tim spoke of the harrowing experience of running one of his spears through his own thigh while on a hunting expedition in the African wilderness. Specifically, while telling us the amazing story of how he survived this ordeal, he discussed how he realized he might well die but that he felt he owed it to his loyal fans to film every bit of his death and to share it with them. Luckily, he lived through the ordeal… Not many things “blow my mind” but this tale indeed did… Wow…

I now turn things over to class member Cole Trickel to share with you more details on the amazing Tim Wells ’87 and his visit to the Midwest Entrepreneurs class last Thursday.

Prof. Gabel

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First things first…

Thursday April 28th Tim Wells came to campus to talk to a group of students about his entrepreneurship adventure. He grew up in Canton, IL which is just a hop, jump and a skip from where he graduated from Monmouth College in 1987, where he came to run track. Tim also talked about how times have changed since 1987, when he was allowed to have his bow in his room and string a buck up from the balcony of his dorm room. “Canton is a great place to grow up, if you like the outdoors”, just for the fact there is not a whole lot of indoor activities in Canton. This is part of the reason why his foundation of success is built on faith and family values. Tim claimed that you cannot be successful without a solid foundation and a good education.

Tim created and hosts #1 bow-hunting show in the world, “Relentless Pursuit,” and shared with us a number of the thousands of wild stories that go with it. Included in the stories he shared with us was “the shot heard around the world.” This might seem a typical hunting story that you would tell around a bonfire late at night, except this was no fictional story. “The shot heard around the world” is the story of Tim Wells putting an arrow between the eyes and through the skull of a North American Brown bear. It was said that it could not be done, and so he set out and accomplished the task that no one else was brave enough to attempt. This “relentless pursuit” of the seemingly impossible is key to Tim’s entrepreneurial success.

Stories like these are all fine and dandy but Tim’s successes is not what made me envy him as a successful entrepreneur. The way he claims that we are part of the circle of life, humans are consumers of Earth’s every resource. It is of high importance for people to understand where Earth’s resources come from. Tim travels the globe to hunt but also to spread awareness to pursue the passion of hunting. Tim is a lover of life, you take a life, you give life to something else, it is all part of the circle of life.

Tim also talked about how the education he received here at Monmouth College has helped him to set himself apart from the competition in the hunting industry. The writing skills that he was required to receive here and helped him to write his book, “A Demon in the Dark”, that has been published globally. It distinguishes the difference between hunting and poaching. Tim claims that we students are the future of society and to keep an open minded; not bull-headed like I know I become sometimes. If you have a great idea and work ethic you can go anywhere, do almost anything and be successful. With that being said, success will follow, but success sometimes breeds jealousy. People wish they were as successful as you are and will cut you down to get it, this is why Tim says to surround yourself with good people, people that want you to succeed. With technology now-a-days it easy to do something stupid on camera and everyone is going to see it.

Now for some number figures… Once you become famous people will know your name and people will want to be like you or cut you down; it goes both ways. Tim told us, for example, that he gets paid 5K every time he wears a certain hat or t-shirt on television and/or talks in some sort of interview and an additional 100K a year just so that one hunting products company can use his name (as a user and sponsor of their products). Tim talks about seizing every opportunity possible because you never know when one opportunity is going to be worth that 100K every year. Talk about marketing at its finest. Tim is basically a “rock star” celebrity in the world of hunting. Professional hunters and other sportsmen want to grow up to be like him, just like little Billy wants to grow up to play Quarterback for the Chicago Bears.

Last thing… Tim owns the word “slock”. I have never shot a bow before that he tells us that it is the noise that a bow makes when the arrow in released. That is pretty awesome to own a cool word like “slock”.

The last couple of things that Tim wanted to leave us with is that while sacrifices have to be made to be successful, just make sure they are not the wrong sacrifices. Entrepreneurial moment: “When you find your lick, and are making the good money, reinvest in your company. Don’t be stupid like me and blow it all away like I did when I first started off.”  Also have the ability to take risks, keep your sense of humor wherever you are, whatever you are doing, be able to laugh at your failures and learn from them.

Who you are as a person defines you, that is why Tim’s foundation is built on faith and family values.

Cole Trickel