|He Didn't Know Times Were Tough|
Somebody forgot to tell German immigrant John Volken that Canada was in recession in 1981 so he went right ahead and became a success. From his first small used furniture store in Vancouver, he turned "United Buy and Sell" into a huge financial success with thirty-eight stores in Canada and four in the United States. And he's still growing.
"We were an overwhelming success right from the beginning," John says. Although the company name says otherwise, United Buy and Sell deals only in new furniture. John's philosophy and method of sales is simple: “low overhead, no commissioned sales staff, and low prices. We offer a sofa for $750 that costs us $500. Another retailer sells it for $1250. He sells one and we sell three. He makes a $500 profit; we make $750."
From that first east Hastings Street store and one employee, United Buy and Sell in 1991 employed 320 people with total sales of $75 million.
When John Volken first arrived in Canada from Germany he was 18 years old, on his own, and bug-eyed at the opportunities this country had to offer. But, first he had to eat, and 18 year olds eat a lot.
"I worked at fast food outlets washing dishes and in construction and on farms. Meantime I was looking around for a business to get into. I had some experience in a flower shop in Germany and I did that for a while. I found I enjoyed business. But jobs were scarce: That was in 1960, another bad year!"
John finally moved to the west coast and rented the building that would be the start of his chain. He had little capital and even today keeps financing costs as low as possible. He has a $1 million line of credit but carries no long-term debt. His aim is to sell as much merchandise as possible, as quickly as possible. John owns only one store and leases his other buildings so he can close them down when United outgrows them.
"We keep the decor simple, no frills-no gimmick is our motto. Our staff are all on the floor, managers and assistants as well, bringing in sales."
John pays his sales staff well after they prove themselves. Other stores hire people with experience.
"We do the opposite. We hire young people at minimum wages for a year to learn the trade. Those who survive are disciplined with long term career commitments who can move rapidly up the ladder to all levels of management.
It gives our staff initiative to work harder and work until the jobs finished. "
With more than 52 stores in 1991 and 30 more on the drawing board,
when will there be enough? And when will the thrill of building a furniture empire wear off?
"I don't think it ever will wear off. Every time we open a new location it is an exciting event. Consumers welcome us and accept us with enthusiasm. You can't help but get a kick out of that. It’s the thrill of being accepted as we are. I know that we are going to stay simple, although we have gone to computers now. Up to 1990 we did without them.
"I still believe that to be a success in business you have to keep things simple. Too much paperwork can ruin you. We have three people at head office to handle the paperwork. Compared to my competitors that is a very small staff. The reason is that much of the paperwork is done by the managers at the stores. Our managers don't just sit in the office and 'manage,' they work."
Low overhead, well-paid and trained staff, and a huge advertising budget (well over $2 million on radio and television every year and rising), the formula seems to work for the young immigrant (he's still only 48).
"We're planning to be the McDonald's of the furniture business."
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