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Business Lessons from an Immigrant Boyhood
PAGE 6 OF 6
Once I got over the adrenaline rush of stumbling across such a fat cash cow, I started feeling overwhelmed by the sheer amount of work. I was waking up at four every weekday morning and couldn't quit for dinner until seven or eight each evening. I spent half my weekends sleeping. I was running myself ragged. My father noticed the rings around my eyes and suggested franchising the routes to reduce the need to hire and supervise employees. I put ads in local Asian-language papers. There was no shortage of recent immigrants willing to push a cart around to make four or five thousand a month. Each franchisee was worth three thousand a month in my pocket. At the end of a year I had twenty franchisees working office buildings along Mid-Wilshire. For a while it felt like the old days back in South Central, only on a bigger, more lucrative scale.
I paid back my father. Having learned my lesson, I didn't waste money on wild spending sprees. I saved almost everything I made. Good thing too, as it turned out.
My franchisees started turning into competitors. One by one they breached their agreements and set up their own operations. They offered more money to building owners and security guards. They undercut my prices to customers. By the middle of the second year, I was locked in a grim rat race just to stay in business. Then came the L.A. Riots.
For over a week we were shut out of our routes. I spent anxious days staring at the scenes of looting, fires and mindless destruction flickering 24 hours a day on TV. My parents kept thanking god they had moved out to the burbs. My poor Los Angeles had become the loser in a civil war. When the National Guard finally opened the streets, I joined tens of thousands of rubberneckers driving through what remained of Koreatown. To see so many buildings gutted out or boarded up was a surreal experience, and I will never forget it. Each represented the wiping out of some immigrant merchant's dream, built up through years of sweat and sacrifice. Landlords were losing rent from their empty buildings. The residents of South Central were left without places to shop. And bitterly disillusioned merchants vowed never to return to the area.
In this desolate landscape I saw the biggest opportunity of my life.
[CONTINUED BELOW]
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One lesson I had learned well and was determined never to forget: money is best made by selling cheaply to people with little money. Dress princes and live like a pauper, dress paupers and live like a prince, someone had said. Someone is pretty smart. Few people know what that guy means better than I do. As I surveyed the desolate commercial landscape at the heart of Los Angeles, I saw neighborhood after neighborhood begging for stores offering low-cost clothing for the family. Even the poorest family has to buy a half dozen items of clothing each month. Many don't own cars in which to drive to the chain stores tucked safely away in the suburbs. Where everyone saw a landscape full of anger and destruction, I saw people crying out for bargain clothing stores. I was so sure of my instincts that I didn't even bother bouncing the idea off my father.
I leased an eight-thousand square-foot building for a third of what I had paid for my boutique space. The owner probably thought I was a lunatic for even thinking about starting a business there, but he really wanted my check and hid his doubts pretty well. He would have been even more apalled if he knew that I was already planning on opening several such stores.
Most people can't imagine how much money poor inner-city Mexican and black families spend on inexpensive clothing for kids. I can because my family was one of those family during our first years in this country. The children's items alone accounted for over half my profits. My bargain center quickly blossomed into a money factory. Within a year I opened two more just like it. One of the most satisfying aspects of my new business was giving something back by hiring all my clerks from within the community. Some people might have been scared to set up among poor people, but I saw them as the source of my first and happiest business success. They weren't looking to show off, make a statement or give anyone a hard time. All they wanted was to buy what they needed at a price they could afford. For the most part, they were too easygoing to be picky and too honorable to return items just because they changed their minds.
Your first million is the hardest, they say. They are pretty smart. My bargain centers awarded me my first million at the age most people are being awarded B.A.s. That million was my diploma from UHK, the University of Hard Knocks. It opened more doors for me than any sheepskin. It made people fall all over themselves to trust me with whatever I needed -- money, merchandise, buildings, the best years of their young lives. I welcomed these offerings and made good use of them to expand and diversify my business interests. The details of what and how and how much are much less exciting than the details I've shared of my first successes and failures. Even now, as I gaze at my twinkling city from high above the Golden Mile, what really makes my eyes twinkle and my heart pump is anticipating my next chance to turn adversity into opportunity in this wonderful land of free enterprise.
| "In this desolate landscape I saw the biggest opportunity of my life." |