Retail Innovators – Randy Shayler, Zeswitz Music (2018 Summer NAMM)
In 2013, Randy Shayler purchased Zeswitz Music, a 90-year-old school music retailer. Since then, the company’s sales have increased more than 40 percent, and the number of schools served has nearly doubled. During “Retail Innovators” at 2018 Summer NAMM, he discussed how Zeswitz achieved that growth by overhauling its systems and creating what he called “a vast advantage.” Here are highlights from his interview with NAMM President and CEO Joe Lamond.
On overcoming obstacles:
[We had] one of the most inefficient warehouse layouts I’d ever seen. I went and talked to the folks who were working in the warehouse and said, ‘Why don’t we have a center aisle? Why aren’t the things laid out more efficiently?’ And they said, ‘That would be great, but you know those racks are bolted to the floor, so we can’t move them.’ I said, ‘Really? What size wrench would you need to unbolt those racks from the floor?’
That became a metaphor for us and a parable, if you will, about breaking down obstacles in the business. And there aren’t a whole lot of obstacles that we can’t address in some way, shape or form in our business—in all of our businesses.
On sustaining innovation in school music retail:
I don’t see disruption [in the school music business]; I see sustaining innovation. I see dealers across the country—and I’m fortunate that we are one of them—that are pushing the envelope in terms of the reliability of the musical instruments, the quality of the service, the turnaround time, and the reliability and quality of repairs. I see the industry pushing the envelope to get better and better at enabling those beginners to have success with their first musical instruments.
On creating “a vast advantage”:
We said, ‘OK, of all the things from accordions to xylophones, what can we be great at’? And we picked school music, and we focused our energy there. Time is the only resource we can’t add to, right? That’s the only scarce resource.
Through this fall, we will have just about doubled the size of the rental business. Revenue growth, last year to this year, is about 18 percent. And through some good investments in technology, we’ve been able to do that without really growing SG&A and overhead.
On improving systems:
One of the best decisions that I made early on was to invest in a new system to run our rental business. We had been on what was, I think, the more or less standard IT system in the rental industry. And it wasn’t doing some of the things we really needed it to do. And again, coming from outside the industry, I have a very process-oriented background. So we were able to create a rental process that really made sense in our warehouse, an order flow that really made sense for our customers and then a customer-service experience that we’re able to now enable visually with our software.
Now, software’s not the panacea. Nobody made their business great just by buying software. It’s mostly process engineering, I would say. But literally, what we did was replace the software with the new, custom piece of software.
We’re roughly where we were when we started, in terms of headcount and operational overhead.
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