Transcript

Adam Honig:  Hello and welcome to Make it. Move it. Sell it. On this podcast, I talk with company leaders about how they’re modernizing the business of making, moving, and selling products, and of course, having fun along the way. I’m your host Adam Honig, the CEO of Spiro.ai. We make amazing AI software for companies in the supply chain, but we are not talking about that today. Instead today, we’re talking with Paul Dietz, the former president, and now senior advisor for Chippenhook, probably the best branded retail fixtures company out there. Paul, welcome to the show.

Paul Dietz: Glad to be here, thank you for inviting me.

Adam Honig: It’s our pleasure. Now tell us a little bit about branded retail fixtures at Chippenhook, what does that mean?

Paul Dietz: It’s a funny little corner of the business, we like to say our products sell your products. And we design fixtures, so let’s say you’re selling necklaces, we design a neck form that helps tell your brand’s story without overwhelming the product. It’s a very odd balancing act, but we’ve done our job well, you don’t see our stuff, but you feel it.

Adam Honig: Gotcha. So the goal is to showcase the product, but still have a great presentation at the same time, so that it all looks wrapped and neat to go. And is it Jewelry, what kind of products do you typically package?

Paul Dietz: So we started with jewelry and with fixtures and displays, then we went into packaging. And then we decided we could replicate that same brand journey in eyewear, we now do it in medical, and we’re in footwear. The concept works the same. As long as there’s a brand that wants to tell its story at retail or in the unboxing experience, when someone gets home, if they want to continue their story there, we’re the place to go.

Adam Honig: Gotcha, that’s really interesting. Of course, retail has been under a lot of pressure for a while now because of eCommerce and the pandemic and stuff. So is the unboxing part of the business becoming a bigger growing sector?

Paul Dietz: It’s very much so. And actually one of the things we do is unsolicited unboxing of people that we don’t, they’re not our customers.

Adam Honig: That sounds kind of scary. What do you mean by unsolicited, tell me more.

Paul Dietz: We’ll go out and buy a brand and buy their packaging and give them at no charge, critique about ways that they could improve the unboxing experience. And we’ve got a lot of customers by putting that time in on the front end. Usually there are not a lot of people at a brand thinking about those things, but you sell a beautiful necklace and your online experience is a Ziploc bag, there’s a problem there. You’re not romancing your own product. And when you’re selling online, the brick and mortar is your box, that’s telling your brand’s story. So it’s a very good tool for us to round up new clients, so to speak. Which is how we’re managing through the change at retail, by increasing our market share because everybody is under pressure. Everybody is under pressure, and we’re just widening our market share.

Adam Honig: Yeah, I really love this concept that the packaging is like retail for people, that makes so much sense to me. And you’re right, there are some companies like Apple, where it’s like a religion for them about how things go. And I feel like companies that I talk to in the manufacturing space seem to either wanna be Amazon or Apple or some combination of the two of those. They want to adopt from these leaders the best practices. I’ve also been developing this theory that as the world has gone to more e-commerce that the packaging, the whole look and feel, even the shipping and everything of products just is so much more important than it used to be. So it sounds like you’re seeing that in your business too.

 Paul Dietz: It’s really critical, I think. We started in jewelry, which is very small, so everybody’s looking at the details, so details matter. So when we started going to bigger things like eyewear, our eyes toward very small details translated very well. It was something they weren’t used to seeing. And frankly, we’re tearing it up in medical right now of all places because you would be surprised at what your doctor uses or puts in your body even, it’s branded, it’s a brand of knee replacement or whatever. And they’ve never really thought about telling their brand’s story and differentiating themselves from the competitors. That’s really what it’s about, is differentiating yourself, I think.

 Adam Honig: Yeah, I totally agree. But I’d like to talk with the guys who name those pharmaceutical products. Is there a requirement, like it needs to be five syllables and have a Z and a Y in it? It’s like a strong password. It’s like a crazy name, who comes up with these names?

Paul Dietz: You’re absolutely right. And what’s even wilder to me is just how they’re packaging requirements, which are right and absolute for safety and to be germ-free. That’s not the space we live in. That piece gets then put into a branded piece, so it’s an extra step, but the packaging requirement for these medical people, holy guacamole. And don’t even talk to me about cannabis because that’s different in every single state, sometimes in different parts of the same state. It’s a crazy thing to navigate, but it’s really important.

Adam Honig: Totally agree. Unfortunately, I’ve been kind of a habitual COVID tester. I’ve gone to a lot of meetings with clients, I didn’t wanna show up and give anybody COVID and if I can buy the Pfizer Binax, it just looks so much nicer than all of the other ones. It makes me feel like it’s a better product, even though it’s all the same [expletive]. I’m sure it’s exactly the same reagents and stuff like that, but I just feel that way.

Paul Dietz: It’s like generic, and so the mind thing is the same, but you feel better buying the branded name because they’ve put some skin in it, right?

Adam Honig: Yep, and in medical stuff, the placebo effect is really important too. So if you really feel like you’re getting that premium heart valve or whatever, then maybe you are, I don’t know.

Paul Dietz: Yeah, I think there’s something to it. In medical so far, at least for us, our client isn’t the end user, it’s the doctor. That he’s getting the very best to put into his client. And they get brand loyal just like you and I get brand loyal about the pants we wear and the shirts, you know, every brand has a story. And in medical, it’s distinctly different than say a beautiful jewelry necklace and bracelet.

Adam Honig: Yeah. Well with the prices of some of those medical products though, I bet they’re more expensive than some of the jewelry, as a matter of fact. And how did you get into this field, Paul? Because I know you weren’t growing up being like, I really want to be in the branded retail fixtures business.

Paul Dietz: You know, I am a complicated guy. I have always been involved with custom manufacturing, which is a weird little corner of the universe. I started making furniture products that were custom, and then I got involved with custom musical instrument cases for people that were in orchestras. They had some valuable stuff and all one or two off. And the guy that sold me my material for the musical instrument cases said “I know a guy that has this business in jewelry display and you guys would be great together.” And I met him, we were great partners, and eventually, that company got bought out by Chippenhook and I ended up being a gift with purchase.

Adam Honig: That’s a great story. I can’t tell you how many stories I tell, or I hear people tell which always start with, “I knew a guy and then this happened.” 

Paul Dietz: I stay in contact with almost everybody I’ve ever been in business with. It’s just amazing how putting a little bit of effort into staying in contact yields you such a robust life, right? You just hear about things, people move on into different industries and you kind of hear a little bit about that. I just think it makes you a more complete person.

Adam Honig: Now you and I were talking about this pre-show, but there’s a lot of lessons that we teach our younger staff that are kind of coming up through the ranks. And I’m just wondering how do you teach them to stay in contact? What’s the advice that you would give folks?

Paul Dietz: So I really don’t like junk email, but for 30 years I put out something called The Monday Maxim, which was just a little saying, just one sentence and everybody I’ve ever known was on that contact list. And you’d be surprised how that little message to everybody I knew resonated with people. I’m sending out a thousand, but I’m always getting five or six back every week saying, oh you know, I was thinking about calling you or this happened to so and so. I think selling today is much different. I think it’s about finding out where the rock is in someone’s shoe. We fix problems, as salespeople today, that’s our job, is to fix a problem. We’re not selling a product. If you can go in and have an honest discussion, I mean, no one calls us up because things are going great, they’re calling us up because there’s a problem somehow. Whether it’s in production, whether the brand message isn’t consistent across the board. Sometimes you have brands that deal with three and four and five and ten vendors. Well, every vendor’s trying to interpret the message and it’s not coherent across the brand. So I think for me in sales training, staying in contact with people and listening, listening, listening, and finding out where the rock is in their shoe, that’s the secret. It’s really simple.

Adam Honig: Gotcha. So really just focusing on the very fundamentals of course. And I know there are so many people out there who talk about all these advanced techniques and emails, sequences, and stuff like that, but I totally agree with you. I think what it really comes down to is how do we help people. I always talk about it with the team, people are looking for the holes, they’re not looking for the drills, and how do we help them figure out where the holes are that they’re trying to either drill or fix or something like that.

Paul Dietz: I think that’s exactly right. And maybe there is a better way. Look, there are many paths to the same place, so I think you have to be authentic, right? I’m a really big reader, I love business books, and if I’m reading a great business book, I’ll buy five and I’ll highlight an area that really spoke to me and send it to people unsolicited. And that’s me, if one of my salesmen tried to do that and they’re not into it…I have a salesman that’s a great chef. He drops off recipes when he goes and makes sales calls, it’s his story, and God bless. I think you have to be authentic, I think you have to be truthful, and I think you have to be highly organized, which is kind of where Spiro comes in, in a way.

Adam Honig: Yeah. Well, let’s talk a little bit about your sales team and experience at Chippenhook. Because I know the manufacturing industry is often not the most technology forward and you’ve just gone through an exercise of getting the team to adopt new technologies. So maybe tell us a little bit about what that was like.

Paul Dietz: So it was possible because, and I used myself as an example, if I can navigate it, anybody can navigate it. And having a platform that was easy to navigate was helpful. What we found that surprised me along the way is we didn’t have standard terminology. We thought we did, but when you start recording it all, define a prospect. I had 15 different definitions of what a prospect was.

Adam Honig: Some guy it was when he saw the sign on the building for another guy’s when he had a signed contract.

Paul Dietz: That’s exactly right. So the first time we made our first weeks pass, there was one guy that had 15 million dollars worth of prospects, and I go, we got a definition problem here and that was helpful to us. How long does a prospect live? We all lose a customer from time to time, but we keep them on the customer master. Well, you can’t, they’re gone, it’s done, life changes.

Adam Honig: Let’s just drill into one of these things for a second. So how did you get the team to agree on the terms? Was it, you just told the team this is what we should do, or was it a consensus or how did that work?

Paul Dietz: So it was with the sales managers of which we have two in our family of companies. And I believe that they spoke to their salesmen to get input. It was pretty clear, you threw up a screen of everybody’s sales funnels and it was pretty clear something had to happen. And then it was just a matter of adopting something that was standardized, but there were so many, I can’t remember them all, but things that you thought you knew that you didn’t know, that improved by the old adage, what is measured improved, right? And we weren’t measuring accurately and I thought we were, but we weren’t. And now, today you can look at the top of the sales funnel and with deadly accuracy, you can predict what the sales are gonna be. 

Our sales cycle is very short. So we design something, we build it, it’s maybe a six or eight week build in the factory and then maybe four weeks on the water. So we can go from start to finish in three months on a project quite easily. So with the short sales cycle, your funnel at the top is really big and figuring out how that funnel relates to monthly sales, and of course, now that we’ve been with Spiro for what, five years, we have all that data, and you can play around with it. And that’s what I think the sales managers love, and that’s what keeps selling me on the project. You guys really should put me on the payroll, but it really is a magnificent tool that’s easy to use. My salesman range is probably from 40 to 70. So none of them are just fresh out of school and dying to do more data entry. And this allows data entry once, and then it gets sped into our other systems from there, which is very helpful.

Adam Honig: So from an adoption perspective, of course picking an easy-to-use product, super important.

Paul Dietz: That’s key.

Adam Honig: Getting the definitions right so that everybody’s talking on the same page about what these things mean, and then measuring.

Paul Dietz: And we measure, we have quarterly sales meetings where everybody’s involved, they’re actually using slides off Spiro, so it’s very easy. Then of course, as with any sales group you get, salesmen are competitive by nature, and so they see what other people are doing and it’s in the same format. There’s kind of no wiggle room. One of my favorite sayings our current president Mark Zelk came up with is “You can’t fake the harvest.” At the end of the day, the numbers, and the sales are what they are, doesn’t really matter what the top of your funnel looks like, if you’re not closing the deal. And that is visually clear and apparent, which is a wonderful thing.

 Adam Honig: Now your business sounds like it’s a little bit more analytic than maybe the other companies. What about the culture makes you guys more number-hungry, do you think?

Paul Dietz: So our parent company Sigma Queue, is a huge manufacturer in Central America, one of the top 100 in Central America. And they have plants that make boxes for Colgate on three-year contracts. So it’s a very different beast, right? It’s a numbers-driven company and they bought Chippenhook maybe eight years ago now. And my sister companies have three-year concrete pipelines and they came to me and said what’s your pipeline? I said oh, about three months. And their need for data for a big company to understand and do planning meant that we had to understand our data in a way that when we were an independent company, we didn’t maybe have to, it made us a much better company. Oh my goodness. But it was out of necessity, and it was our parent company, they run SAP and they’re very serious about it. And anybody that’s worked with SAP, it’s about as flexible as my first wife. It’s just a very rigid program, and that fits them. And then we came along and our sales were varying upwards and down by 30% in a month because if the bubble moves past the end of the month, it makes a big deal on our numbers. And boy, we were able to flatten that and be very predictable. And that made me look good in front of the board of directors and probably kept my job for however long I was there because God knows I’m not a numbers guy.

 Adam Honig: So the analytics, the data hungriness was sort of imposed from above in a sense. But what it seems like the takeaway is that it made the business a lot stronger because you guys were able to predict better and that yielded operational efficiencies in the business. Did it improve profitability as well?

 Paul Dietz: Profitability, and for us, we were able to target new clients. We’ve always targeted new clients, but we have programs, there’s a huge one that we’ve started right now towards new client recruitment in a way that we never have before. The success is unbelievable. I think last year for Chippenhook, over 20% of our customers were new customers, so the growth has been phenomenal and I believe it’s managing that data. Obviously we do a good job too, that’s the root of it, but understanding what makes a good client as far as numbers, as far as their sales, and their branding opportunities, all of that is tracked in a much better, more cohesive way. The whole is so much more than the parts. The salesman just sees his little world, but for me to be able to see what’s going on across the scope of the whole company, and you can see someone that’s being incredibly successful and figure out how to replicate that. And really, isn’t it our job to find someone that’s struggling and figure out how to help them? This is all really clear in a way that maybe it wasn’t before. You know, salesmen are really good at telling stories, that’s what we do, but numbers don’t lie.

 Adam Honig: So having a great product, and a great team still doesn’t mean you get new customers, you still have to be in front of them. You still need to know who to target and how to go after them and get in front of them to turn them into those new customers is part of what I’m hearing.

Paul Dietz: Yeah, and to me, it’s always about authenticity, telling a consistent story across all the salespeople, what is our hymnal at Chippenhook? What do we do? Our products sell your products. You’re not gonna come to us and say oh, look at this ring finger, how much can you make this for me? That’s not our thing, I’m more interested in that ridiculous piece of jewelry or that ridiculous pair of glasses that doesn’t fit on any displays. How do we tell that story? Where’s your problem? And telling that across the board has been incredibly helpful. The other thing that’s really unique about Chippenhook is there are no constraints on our designers, and I mean no constraints. They’re allowed to draw with their imaginations, and this has been Chippenhook’s way for 30 years, they can draw with their imagination. It’s our job to find the factory that can make that dream come true. But there are no constraints like okay, this is what this factory’s capacity and capabilities are.

I remember years ago, we had a huge customer that wanted to put an iPad when iPads were new into a counterpad, and we went to our factory and tried to make it, but it didn’t work because we’re not making stuff that people drop and touch screens and all that. So when I was over in China, I went to a place that made laptop bags and I worked with a whole new client and I taught them how to make it look like a jewelry presentation. And we used that to make these however many they were, always being flexible. And we have probably 15 factories we regularly work with in China and we own vertically integrated in Central America. So if we can’t make it in our group, we’ll find the group that can, and that’s really unusual.

Adam Honig: That is really unusual. And you know, what I’m hearing is not just the artistic side of things, which I think is a big thing too, but also the mindset thing, that you’re looking at the problem first. Like the rock in the shoe, but then drawing all the way through to-we need to find the solution for that client, we need to navigate it. And of course there’s gonna be a solution out there, we just haven’t hit upon it yet if it’s not in-house.

 Paul Dietz: But you kind of get good at it if you do it enough times. I mean when you think about it, every project starts with a pencil and a piece of paper, and someone’s sketching something and saying well, what about this? And that’s kind of unusual, it’s so custom in the Chippenhook world. Okay, so we came up with a beautiful display for client A and they may buy it for three years and then they have to change it again. And that’s okay, but in general, our stuff doesn’t replicate, we’re starting every project with a blank piece of paper. That’s really cool to me, that’s what was always interesting, every day was like Jumanji, “What’s coming?”

Adam Honig: Yeah, exactly. Now is Chippenhook getting into 3D printing and custom development and stuff?

Paul Dietz: Absolutely, I remember 20 years ago, I would be in China because you can draw a neck form in the way a necklace hangs on it, but you have to have the jewelry and lay it on the neck form to make sure that the curves are right. I mean stuff that’s way beneath the noise, no one’s gonna notice it, but you’ll notice it in your brain.

Adam Honig: The subconscious will see it.

Paul Dietz: Exactly. Nowadays, we can actually build a 3D model and do it in the office and change it twice, and then send the 3D model, send the file. They make their own 3D model in China or Salvador or wherever it’s being made.

Adam Honig: So you do a 3D image of the jewelry and then send the image of that. And then they lay it out with their own 3D printing of it in the display case so that you know exactly how it’s gonna work.

Paul Dietz: Sometimes. We had a case recently, it was really an award-winning display where they needed real flexibility. And so the designers came up with these octagon shapes that were magnetic. So they kind of snapped together and they could make this beautiful window display to fit any one of 150 different window configurations, and still tell this brand story. It was really magnificent. That started with 3D printers because we weren’t sure we could make it. They designed it, woohoo, now let’s figure out how to make it.

Adam Honig: Man, this stuff is moving so quickly. I was at a factory a couple weeks back in St. Louis that were making images. The dentists would send them images of teeth and then they would make a 3D image of the teeth. And then they would make a 3D printing with metal of the braces that would go on the teeth so that it would be perfectly fit when it gets back to the dentist. They’re very different than the orthodonture of your and my youth where everything was custom wired in your mouth. Can you imagine?

Paul Dietz: Absolutely, it’s just the assists that are available to us in manufacturing today are insane and they’re changing. It’s like your computer is trash in two years, same way with your 3D printer because they’re just getting more cool stuff all the time, but it’s made our life easier. But at the end of the day, it’s all about figuring out what the problem is. It starts with the problem and hopefully, dear mother of goodness, hopefully a solution.

Adam Honig: Right, and hopefully that’ll lend the end customer, the doctor or the retail agency, or what have you, being able to display their product better and sell more. So it’s all part of that one chain.

Paul Dietz: You know, I gotta tell you, every vacation picture I have, there’s a couple of the kids, one of my wife, and then there are a lot of displays in windows in different parts of the country. My wife gets so mad. We get home and review the pictures, I go look at this, all this stuff is misaligned, it’s chaos in people’s minds, they’re not gonna buy anything. And she goes, “Yeah, yeah, yeah, let’s see the pictures of the kids on the beach, oops”.

Adam Honig: That’s so funny Paul. Growing up, my dad was an advertising executive, he was a madman on Madison avenue in New York and we watched TV for the commercials.

Paul Dietz: Kinda like the Oscars, right? Or the Super Bowl.

Adam Honig: Yeah, exactly.

Paul Dietz: It’s wild stuff, and it’s amazing. I’m really glad that I found this little niche that allowed for so much creativity. And it’s just a weird little corner of the world, but I guess all of us in business are in weird little corner of the world. If you strip it away, there’s an entrepreneurial spirit, I think, to most people in businesses under 50 million, and there are people that are driving it. And you can make a change, right? That’s what’s so beautiful. The exciting part to me was always how quickly you could make an impact. And I don’t think you get that in really big businesses. I probably wouldn’t be successful at Toyota, and not to knock Toyota, but just a big corporate environment, you pick the big corporate environment.

Adam Honig: Although, I had this sort of moment, I was at a cocktail party and I was talking with this guy and I said, what do you do? And he’s like I’m the nut buyer for Nestle. And I’m like, well what does that mean? And he’s like, well I fly to Brazil for the nut harvest, and I try all the nuts and I tell Nestle which nuts to buy for all the candy bars, and that’s amazing. First of all, that’s somebody’s job, but if he chooses the wrong nuts, I mean Halloween candy all across the country is gonna be [expletive]. I don’t know what to say.

Paul Dietz: It’s an amazing thing, isn’t it? My brother used to work in the Alabama prison system as a drug and alcohol rehabilitation therapist, and a big wig was coming through once. They were all sitting and the guest asked for an extra pat of butter, and the inmates said “Everybody gets one pat.” And he says, “I’m the supervisor of all the prisons in Alabama”. He said “Oh, I’m the guy in charge of handing out the pats of butter. I’ve always remembered that, everybody’s got a job baby.

Adam Honig: No doubt. Well Paul, this has been awesome to have you on the podcast, I really want to thank you. And we covered so much interesting stuff, like talking about packaging being the new retail with the unboxing. Amazing, great stuff right there. Of course, your whole philosophy about being authentic and finding the rock in the shoe as the problem, that’s so important for everybody to be focusing on in their business. I know we talked a little bit about tech adoption and ways to go about that. And I think there are a lot of takeaways from this podcast that people can get a lot of value out of, so I really appreciate your joining us today.

Paul Dietz: It was my pleasure. And I have to say, one of the great surprises of my life was working towards the end of my career with Spiro. It was just so easy. God bless you all, it’s been a great ride and it is really wonderful talking with you.

Adam Honig: Thank you, that’s a big compliment for us, so thank you Paul. Hey, everybody who’s listening, as a reminder, you can find every episode of the Make it. Move it. Sell it. podcast at spiro.ai/podcast.

And if you thought the conversation that Paul and I had was interesting, or you took a couple of tidbits out of this that might be helpful to your business, why not give us a good review or a rating or a thumbs up or whatever people do, Paul, when they’re out there in social media. You know, post it on LinkedIn, I know Paul’s a big LinkedIn guy, so tag him or me there.

And everybody, thanks for tuning in, we look forward to the next episode.