Greg Keane has owned Chow Hound Pet Supplies with his brother, Tyson, since 1989. Even though he had always viewed his business as a success, when Greg fielded a call from a complete stranger in 2011, he realized there was an opportunity out there to redefine what success meant to him and to grow his business in previously unimaginable ways.
Greg Keane: Over a 29-year period of time … we’ve expanded to ten locations, but we didn’t start that way. We started originally with, you know, a store about every other year for the first, probably, seven years and then we closed our first two original stores, because they were kind of old, obsolete locations and expanded with larger locations in those marketplaces where we were able to service the customers better. It’s been a slow, steady growth.
When did you first hear about Spader and engage in the concept of 20 Group?
GK: It probably would have been 2011. I fielded a phone call from a gentlemen named Scott Click of Tomlinson’s [Feed and Pets] in Austin, Texas. He asked me if I knew what a 20 Group was and I had not really heard of one. I mean I’ve heard of different, I guess, business groups that get together and help each other with like practices and some other things. [Scott] had asked me if I had any interest in possibly helping start one. At that point, I reached out to a few friends that I knew in the business, and asked them if they had any interest – if they think this sounds like it could be a good idea.
In the past I had been in a co-op. One of the things that was probably as much value to us as a company and me, just being a member of the co-op, is getting the deals delivered as a cooperative, mostly in a buying capacity, was the interaction with the other retailers. This intrigued me a little bit, so we reached out to some friends.
John Spader was going to come in and talk to us about possibly starting up a group. It was originally facilitated by somebody inside of our industry, there’s a couple industry groups that thought that it would be helpful if there were some metrics by which, you know, other people in the businesses could either measure their business and or give people who were looking for ways to make their business better, to do so. We listened to John Spader’s speech. He convinced us that we may want to take the next step and see if this is something we can go forward with.
What are the benefits of learning and communicating with your peers?
GK: I think that probably is important. On the front end, because there’s a big learning curve on the front end, Spader teaches us so much. Realistically, if you said, “I know all this stuff now they taught it to me, I don’t need to be a 20 Group member anymore for something,” I don’t think that’s a good way to go about it.
Secondly, we get as much or more out of just being part of the group. We’ve got a very active group. We meet once-a-month and teleconference about our industry issues or just even certain specific issues with one vendor or one company. It could be drilled down that much and or, “Hey, I’m struggling with ‘How do I get the most out of my store managers?’ and ‘What have you done with your key result areas to make sure that [managers] understand what’s the most important part of their job?’”
There’s just so much that we can all together discuss and or we can look at one of the member’s numbers on a specific category and just say, “Hey, you know, how are you accomplishing this, how are you accomplishing that?” We have the ability to both discuss it either by email or telephone. Actually, we have the opportunity to get together three, four, maybe five times a year depending on trade shows. We usually try and schedule a breakfast or a lunch or something in between our regular meetings. We really look forward to it, to get together, because some of us were friends beforehand and some of us have become really good friends since.
It’s a big advantage being able to just sit down and have a cold adult beverage after meetings with some really good operators in our business – that you can pick their brain. We’re old white guys, this internet thing – that stuff is so foreign to us. We’ve got members of the group that are fresh out of college who understand how the internet is going to affect our business and we get the advantage of being able to listen to them and or to have them as, I guess, somewhat as a friend to consult. To ask those questions – I think that’s as much value as the financial end of the 20 Group. I think the financial end is just as big, but I think the interaction between 20 Group members is just as big.
There will be certain things that I’m catching in one of our report books, and I’ll just shoot an email to the guy saying, “What’s your credit card bills looking like? Your guy’s not doing you any favors. You need to ask him for a better deal and you want to know what I’m getting and I’m getting a better rate than you are because, you know, it’s this percentage of your business.” Then he’ll call me back and say, “Hey, thanks a lot. You just saved me [thousands of] dollars.
Having an extra set of eyes is kind of nice. Having the ability to be able to statistically look at multiple companies and look at how they are doing certain things in each category and making sure I’m doing at least as well in those categories, it really gives us the opportunity to, again, look at best practices and really take apart the best out of a whole bunch of different pieces that build a really strong team.
It’s not just about dollars, but “What is a high performing company? What do they do? How do they spend their dollars? What do they look like?” Until [20 Group], there’s not information out there in our industry to say, “This is what a successful business looks like.” We didn’t know. Nobody even had a clue what gross margin you should really be after. You read it in a magazine once, one time or another, and somebody said, “Well, this is probably what it should be about,” and that’s what we lived with for a long time.
We had an opportunity to, really, not only think about it in completely different terms. It’s all about A.I. How do you spend you available income? The parts of our business that we’ve always paid attention to add up to those things. It’s a lot different now.
How has Spader adapted to meet the needs of the pet industry?
GK: Anytime they take on a new industry there are some learning curves as to what are the important indicators for that particular industry. You know, what do you track? What are you looking at? I’m a big numbers guy. I love numbers, but my big thing is I like to know that I’m chasing the biggest numbers first. The numbers that are going to make the biggest change, the fastest.
I think that [Spader] recognized that also, and as we, I guess, grew, what our report was going to look like. They were very, very instrumental in keeping everybody focused, but then coming back and saying, “Okay, what changes do we need to make? What didn’t we cover that’s important to your business that you need to make sure that we’re tracking?” We’re constantly changing how we look at things. “Hey, you know what, we all think this is an important category, we need more detail on this.” Those are the things I think, because our business is a little bit more consumable and it’s different than the businesses they might have worked with in the past.
As far as traffic flow, we don’t have nearly the seasonal changes that some companies would, so that helps us as a group. [Spader] learned how all of that affects our businesses differently. I think they did a good job with figuring that out and realistically they gave us a facilitator in Jim, who came from more a regular retail environment. I think he understood, you know, the needs and what is good retail. I think he relates really well that way and I think the group respects him and relates well to him because of that.
How has 20 Group either met or exceeded your expectations?
GK: I didn’t have expectations going in, because I had no clue what it was going to be. I think that it’s completely revitalized our business. It brought some focus to, again, what is possible. From that perspective, it’s exceeded [my expectations] in a lot of ways that I couldn’t have anticipated or even would have been able to think, “Wow, this is possible or that’s possible.” It’s one of those, “didn’t know what was possible until you found out what was possible.” You don’t know what you don’t know.
It’s one of those things that we talk about or care about, when we’re in manager’s meetings, is we’re not afraid of the things we know we’re not doing well. There are some things we don’t even know we should know. Or the things we’re not watching or, you know, we’re not tracking right now, because of changes in the marketplace, like the technology and some of those things. I think those are going to be challenges going forward.
What we’ve kind of bought into with the Spader group, with the 20 Group concept, is it really sold us, to our associates, and managers, and assistant managers, is us becoming high-performing just makes us a little bit more bulletproof. It makes sure everybody gets to keep their job for a long time. If we don’t make ourselves bulletproof, then technology and the changing marketplace could possibly put a big ding in us.
If we’re running on all cylinders and we’re getting the maximum out of our company and the people that work for us, then hopefully we’re giving them rewards that they deserve for those things; then we can withstand anything the market has to throw at us.
For us, that’s what 20 Group is all about. We’ve made a huge stride to our business from where we were at to where we’re at now. We’re “high-performing” in a whole lot of categories and we just got a couple more that we’re slowly creeping up on. By the end of the year, if we can get to that category, in a three-year period of time, well it will completely change; Basically, for lack of a better term, our company family tree. To where we’ll know we have the ability to weather just about anything in the marketplace. Without 20 Group, I don’t think that would have been possible.
What would you tell people who are on the fence about joining a Spader 20 Group?
GK: I would tell them [that] I wouldn’t even consider not joining. I would feel honored if you got the opportunity to join a group. I don’t know, I mean, I remember it was one of those same type of comments that stuck in my head, John Spader saying, “Hey, if we don’t bring you back at least the amount of money you spent by spending it with us, then fire us and we’ll give you your money back.”
In my first year with them I think we probably made a change of probably somewhere near half-a-million dollars worth of additional profit, that we would not have known that we could have gone and got without them. I would tell anybody that I wish I would have known this, what I know now, 25 years ago. My life would have been a heck of a lot easier through this whole process. If you have the opportunity to become involved with the Spader 20 Group, and you listen and go back and make changes in your business, it could change your life.