In 1992, Gary Jordan decided to make a risky career move. He left his job at GM and opened a 3000-square-foot store in Redford, Michigan. The wares: billiard tables and accessories. And Allstate Home Leisure was born. Gary’s son-in-law Roy Farmer, now CEO at Allstate Home Leisure, says that Gary “started with a very, very small amount of money – probably $2,000 or so.” Luckily, from the first day Gary opened the doors, people were coming into the store to look at the game room accessories.
Marketing and promotion – without the digital networks.
If you can wrap your mind around it, imagine how marketing worked in 1992. There was no LinkedIn, Facebook/Twitter/Pinterest, and certainly no personalized advertising on your favorite (sponsored) websites.
Gary and a few of his colleagues would go out to bars around town. He would approach people playing billiards and darts and let them know where they could get high quality, at-home equipment to improve their games. He would let people know where Allstate was located, stay to chat, and be on his way. Allstate saw a good amount of business from those one-on-one, in-person interactions – and also from the word of mouth that ensued.
Customer demands help shape small businesses.
Gary had more business than expected in the first few years after opening Allstate – and so he called in reinforcements. Roy and his wife, Shawna, joined the team in 1994. “It was really an underserved market,” says Roy. “Our customers, at that point, were asking for more of the game room furniture … we started adding things like pool tables.”
Roy says that first-time customers will order something with Allstate – and return in a few months or years for other kinds of furniture. “Over the last 12 years, we have added patio furniture, swimming pools, fireplaces and hot tubs. What we have found is that it’s the same customer that comes to us – the game room folks – who also want to entertain in the backyard with nice, casual furniture, hot tubs, that kind of thing.”
The turn toward home entertaining was a bit of a surprise to Gary and his family at first. Roy says, “We started off with most of our customers being the people in the bars who were playing darts and pool and such. We quickly morphed into a company that sells to families.”
People that really want to make their homes a retreat will start out with a billiards set and then, as they become more invested in the home itself, will start building out their patios for outdoor entertaining and relaxing.
Determine a competitive advantage.
If you’re not very familiar with Allstate, you might be wondering how on Earth the company managed to achieve such success right out the gate. The secret: Allstate has quite the competitive advantage. Most of Allstate’s products are available for customization.
Depending on what category you’re looking at, says Roy, you can change the “color, fabric, finish – [you can] even change the legs on a pool table. …On the game room side, we can do custom finishes. We can send [samples] off to our manufacturers and have wood matched to coordinate with what’s already in the customer’s home.”
Allstate Home Leisure also avoids selling furniture in large sets. Instead of pushing customers to get a discounted set of matching furniture, Allstate allows you to buy individual pieces so you can perfectly configure your deck or game room without trying to squeeze in a too-large furniture set. This is an especially smart move for outdoor decks and patios, where some homeowners are still in the process of constructing their space. A large selection of varied sizes and styles means customers can build an outdoor set that looks organic and homey – not like they just bought the whole thing in one fell swoop at the department store.
The aforementioned competitive advantages allowed Allstate to grow in size and prominence. In 2012, Allstate rolled out its own brand of high-quality products. “This allows us to bring extra value to our customers by offering the latest, most desirable products at prices that are difficult for competitors to meet,” says Roy. With its own brand retailing, Allstate can respond to customer demand quickly and efficiently.
What’s challenging about starting a small business?
Of course, Roy says, even a truly great product and selection doesn’t make starting a small business completely foolproof. Roy and Shawna have learned a lot about the company and their relationship along the way.
“I think the biggest challenge is definitely time,” says Roy. “The amount of time we needed to get our business off the ground and running was extraordinary.” Even though taking the reins at Allstate was a difficult and time-consuming job, Roy says it actually strengthened his marriage.
“My wife and I built this business together, and we spent a lot of time together trying to run this business. If we weren’t [already] in a relationship, we probably wouldn’t have been able to start one [because we were so busy]!” Luckily, the two of them made great business partners and continue to operate Allstate Home Leisure to this day.
What do you need to succeed as a small business owner?
“It still takes an awful lot of time to run the business,” says Roy, “and that’s more of a challenge as you get on in life.”
So what should someone bring to the table if he or she wants to start up a small business?
“There’s a slew of skills you need to have – and very few people have all of those skills already.” Roy admits that his start at Allstate was a major learning curve. “Some of those skills we learned, and we made plenty of mistakes. For us, [the hardest thing to learn] was managing the employees – human resources. Learning to motivate them, hiring the right people, working with employees and encouraging them and getting them to do what we needed – that was the hardest part for us.”
And because Roy and Shawna took such an active role in day-to-day operations, they were also training themselves to be the best employees possible. “You have to wear a lot of hats,” Roy explains. “One minute, you have to put on your accounting cap; five minutes later, you have to be a salesman; and then you have to go clean the bathroom.”
Responsive business and competitive advantage makes a small business a success.
Roy is proud of the business he helped build. “In 21 years, we’ve become the leader in our marketplace.” He knows it wasn’t just an underserved market that helped Allstate succeed – it was the work he and his family did to market, manage, and grow the company. People still remember doing business with Allstate many years down the road. “These days, I’ll meet a stranger [around town] who’s bought something from us. They’ll say hi, and that feels pretty good,” says Roy.
Allstate has grown to include three locations across Michigan – and even an e-commerce site. The company participates in the regional Small Business Saturday event. And in the meantime? Roy and the family continue to deal in relationships rather than numbers. And in a business that’s all about relaxing with family and friends around the fireplace or shooting some pool to unwind, that’s exactly what makes people come back.