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Business Lessons from an Immigrant Boyhood
PAGE 5 OF 6
I still had many pieces to pick up from my expensive adventure into the upscale retail market.
One day I went with my father to visit my lawyer. He was negotiating with the shopping mall to let a new tenant take over the lease and get me off the hook. While waiting in the reception area, I saw a young woman getting off the elevator with a cartload of sandwiches. In about a minute she had sold three sandwiches in my lawyer's suite at four bucks apiece and rolled into the next suite. Ten minutes later she was getting back on the elevator after unloading about twenty sandwiches. And there were twelve floors in that building. In a little over an hour, she could sell a thousand bucks worth of sandwiches! And the profit margin had to be over 75%. That girl was clearing over ten grand a month just selling lunches in one smallish office building. No wonder she was so cheerful. Along the stretch of Wilshire from the Harbor Freeway to the Miracle Mile I figured there must be several hundred office buildings . My head was spinning with the possibilities.
I immediately thought of the shocking amount of cherries, avocadoes and oranges that were left to fall to the ground and rot. It wasn't cost-effective to pick fruit as they ripened, my father had told me. Everything was picked during very brief picking seasons to minimize labor cost and to accommodate the schedules of packing houses. The way the market was headed that year, my father wasn't even sure it would be worth hiring a picking crew that season. Tall buildings full of health-conscious office workers struck me as a good place to cash in on some of that fruit.
During one of my earlier visits to the building, I had recognized the security guard as a former L.A. High schoolmate. I asked him if there would be any problem in letting me do a little selling in the building. "You know how it is, Man," he said. "You take care of me, I take care of you."
"A little tip?"
"No more than what you give a bad waiter."
[CONTINUED BELOW]
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"How bad?"
"Say like one of those dudes that spill soup on your tie."
"Five percent."
"Cool."
If life sends you lemons, make lemonade, goes the saying. I made fruit salad. I loaded containers of it on a cart, along with bottled water, yogurt and other healthy items. I did my selling around morning coffee break and the afternoon coffee break. At three bucks each, my fruit salads were a hit with women on diets. I was averaging seven hundred a day. With no employees and little overhead, I was clearing ten thousand a month! After a few weeks, I had become efficient enough to add a second building. That nearly doubled my profits. After about three months I started hiring people to do the preparation and selling while I supervised, trained and handled back-office functions. For a while I was literally making more money than I had time to count. It was much too good to last.
The owners of the snack and gift shops in the building lobbies began complaining. They complained that their exclusivity clauses were being violated. Fortunately, most of the shop owners were Corean and I persuaded them that, rather than keeping me out, they could do better by cutting a deal with me. I agreed to limit our carts to a few health-food items and pay each shopowner a percentage of sales.
Then some of the building owners got wise and started demanding fees. But even with about three thousand a month per building for the security guards, the building owner and the gift shop owners, and another couple grand per building for my employees, I was still clearing four or five thousand a month from the typical building. Multiply that by a dozen and you have an idea of what I was making. PAGE 6
| "If life sends you lemons, make lemonade, goes the saying. I made fruit salad." |