An Entrepreneurial Story

This is another tale of resources versus resourcefulness.

If you listen to entrepreneurial wannabes talk you will often hear them lament about their lack of resources. If only they had X dollars, a piece of equipment, or some bona fide customers ready to “pay cash on the barrelhead” for their services or products, they would then get around to launching or growing their businesses. In stark contrast, real entrepreneurs demonstrate that they have the resourcefulness to compensate for any perceived lack of resources.

Let me share one of my favorite stories on how little more than resourcefulness can be used to create value. The story is about the early days of the Kenneth Cole shoe company in the 1980s. Ask yourself as you read this story how far you would have gone before calling it quits due to the obstacles thrown in your path.

Cole initially discovered that he couldn’t do business with American shoe makers because he lacked the money to pay up front for design work and the first production run. Since he was a startup no one was willing to extend credit to him. For many people it would have been “game over” at this point. However, Cole discovered that European shoe makers were willing to extend credit to startups like his because they wanted to establish footholds in the large US market. As Cole tells it, “So I lined up the factories, went to Europe, designed a collection of shoes, and returned to the states to sell them.”

The next hurdle he faced was in getting his new lines in front of the buyers for shoe retailers. New lines are traditionally unveiled at an annual shoe industry show centered around the New York Hilton Hotel. Vendors have two options here. One is to book a room at the hotel and become “become 1 of about 1100 shoe companies selling their goods.” The other is to rent one of the many large permanent showrooms in the four square blocks around the hotel. Cole wanted a showroom but couldn’t afford one. At this point, many people who found themselves in his shoes would have settled for the low profile of a room at the Hilton.

But Cole had an idea. We continue in his own words:

I called a friend in the trucking business and asked to borrow one of his trucks to park in Midtown Manhattan. He said sure, but good luck getting permission. I went to the Mayor’s office, Koch at the time, and asked how one gets permission to park a 40 foot trailer truck in Midtown Manhattan. He said one doesn’t. The only people the city gives parking permits to are production companies shooting full length motion pictures and utility companies like Con Ed or AT&T. So that day I went to the stationery store and changed our company letterhead from Kenneth Cole, Inc. to Kenneth Cole Productions, Inc., and the next day I applied for a permit to shoot a full length film entitled “The Birth of a Shoe Company.”
With Kenneth Cole Productions painted on the side of the truck, we parked at 1370 6th Avenue, across from the New York Hilton, the day of shoe show. We opened for business with a fully furnished 40 ft trailer, a director (sometimes there was film in the camera, sometimes there wasn’t), models as actresses, and two of New York’s finest, compliments of Mayor Koch, as our doormen. We sold 40 thousand pairs of shoes in two and a half days (the entire available production) and we were off and running.

To this day the company is still named Kenneth Cole Productions, Inc. and serves as a reminder to the importance of resourcefulness and innovative problem solving. (Source: www.kennethcole.com)

Be honest. At what point might you have given up the quest as an exercise in futility? After being refused credit by American shoe makers? After realizing that you couldn’t afford to book one of the permanent show rooms in the district? Or after being told that you couldn’t obtain a permit to park your truck on the street?

The vast majority of people would have stopped after being told by the American shoe manufacturers that they needed to pay up front for their first orders. This is why, as the old joke goes, God made “jobs.” Remember this story every time you consider delegating a critical task to an employee. The employee mindset is not geared for this type of resourcefulness. If Cole had delegated the above tasks to an employee he most likely would never have participated in that crucial industry show.

This story is a superb example of resourcefulness creating value.