PRINCIPLES FOR GROWING A COMPANY
How focusing on a few operating principles has helped Empire Imports grow from a garage and into one of the largest vape product distributors in the country. As each new federal, state and local regulation continues to strangle the once fast-growing vape industry, many distributors have either scaled-back or exited.
Conversely, Jason Angel, CEO and founder of Empire Imports, did the opposite and just kept plowing forward. Empire today runs under the same principles as when he started the business from his garage in 2014. By 2016, Empire had moved into a 7k sq-ft warehouse, and in 2020, it moved into a 40k sq-ft warehouse, and is recognized as one of the few remaining master distributors that regional distributors and retail shops around the country rely on to keep their shelves stocked.
Jason shares the key operating principles that have helped propel his business forward:
1. Keep SKUs in Stock. To be valuable, a distributor should carry and keep in stock as many SKUs as possible. Convenience is key for shop owners who want to save time by ordering from as few vendors as possible. Without the variety and inventory depth, a distributor cannot offer the service level to save their customers time and money. To that end, Empire carries over 10,000 SKUs in 5-6 key product lines, and tries to ship all orders within 24-48 hours.
2. Invest in People and Systems. Make sure your company has good systems and the right people to run them. Distribution is a competitive business with a lot of pressure on margins. If your business cannot efficiently move inventory through the supply chain–from vendors to the customer–then it will not generate enough profits to sustain growth. Empire has upgraded its ERP twice in the last 4 years and continues to invest in systems and key people to make sure everything runs smoothly.
3. Pick Products Wisely. Many distributors lose momentum by having wrong products or have too much cash tied-up in “dead” inventory. It is paramount to know which products are moving versus which ones are slowing. Furthermore, Jason suggests not committing to carrying products or brands purely on relationships alone. While business is about relationships, analytical product marketing should drive that decision. Empire has an analytics department that uses real-time sales data to determine purchases at any given time during any SKU’s life cycle.
4. Be Predictable and Reliable. Empire believes in having set rules that are predictable, especially not over-selling inventory or over-promising delivery. Empire also tries not to change pricing too often. Unsteadiness in inventory and wild fluctuations in pricing causes business disruptions to its customer base, so both are to be avoided as much as possible.
5. Value-Added Services for Customers. Empire offers realtime inventory and order information online so customers can better plan purchasing and receiving. Empire also offers dropship services for some online-only retailers, with easy-to-integrate software systems for order transfer and processing.
6. Value-Added Services for Brands. While this is a new focus for Empire, kicked off by the addition of CMO Pamela Daily, a pioneer from the direct marketing industry, Empire works closely with manufacturers and brands to distribute product information among regional distributors and retail shops. By working with brand ambassadors and ground teams, Empire helps these brands and manufacturers build momentum for new products and promotions.
Looking into the future, irrespective of what new regulations may appear, Empire plans on staying focused on its mission by using the principles that so far has made it one of the fastest growing distributors in the industry.