What Makes Them Entrepreneurial? #35
Aditya April 14th
Their Street Smart Attitude
I read this fascinating article Street Smarts: My First Year on Inc.com. In this article, the author, who has started a business with messenger and courier service, talks about how he has earned a new business by his impromptu and smart attitude of handling a critical situation like a public transportation strike. Here is a part of the story -
I decided I needed advice from someone who’d been through the previous transit strike, in 1966, and could perhaps tell me what to expect. As it happened, one of our clients was a major accounting firm called Oppenheim, Appel, Dixon & Company. The head of the mailroom there was a guy named Sam Revson, who’d been around forever and whom I held in high regard. Because the strike was scheduled for the busiest part of the tax season, I figured Sam might have made some contingency plans, and I wanted to know what they were.
I dropped by his office one day in the middle of March. “Sam,” I asked, “what are you doing for the strike?”
“Why?” he said. “Are you thinking of transporting people during the strike?”
The thought hadn’t occurred to me, but it sounded like a reasonable possibility. “Yeah,” I said.
“That’s a great idea,” he said. “We could really use you. It makes sense, because you have vehicles already.”
“Yeah,” I said. “They’re ready to go.”
“Particularly being located next to Penn Station, like you are,” he said. “Assuming the Long Island Railroad doesn’t go out, people could just walk across the street, and you could take them downtown. But how are you going to handle the pickup at the end of the day? Have everybody meet somewhere?”
“Yeah,” I said. “That’s what I’m thinking.”
“It’s probably the way to go,” Sam said. “What are you going to charge?”
“I figure $20 a person,” I said, picking a number out of the air.
“Each way or round trip?” he asked. He didn’t seem to have any problem with the price.
“Each way,” I said. “So, $40 round trip.”
“How are you going to know which people are coming back with you?” he asked.
“Once we take them downtown, we assume they’re coming back, and so you have to pay for the round trip.”
“OK,” Sam said. “Are you going to issue passes or sell tickets or what?”
“We’re going to issue passes,” I said. “And we’re going to number them. How many people do you think you’ll have?”
“Well, if it’s just a transit strike, not a Long Island Railroad strike, we’ll have about 50 people,” he said. “How often do you plan to run the shuttle?”
Suddenly, it’s a shuttle. “About every half-hour,” I said. “They’ll come up to our place. We’ll have coffee and doughnuts for them, at no charge.”
“What if there’s a Long Island Railroad strike as well?” he asked.
“We’ll have a carpool service,” I said, thinking fast. “We’ll have pickup points on Long Island, one on the North Shore, one on the South Shore, and a couple in Queens.”
“Sounds good,” Sam said. “Do you want a deposit?”
“Yeah, of course,” I said, “and I’ll need a week’s worth, because we have to set up this whole system. You’re the first person I came to, because you’re our best customer. I have only so much capacity. If you want to do this, I’ll need the deposit right now.”
“OK,” he said. “What if the strike doesn’t happen?”
“The deposit is nonrefundable,” I said.
“OK,” he said. I left with a check for $10,000.
When I got back to my office, I told everybody what had happened, and we all had a good laugh. Then we went to work calling our other customers, making laminated strike passes, and figuring out how we were going to accommodate all the people who wanted to take advantage of our new service. The truth was, we had only four vehicles, and we had to get our own people to work as well. “How can we possibly do this?” my employees asked as more and more customers signed up.
“I have no idea,” I said, “but we’d better come up with something.”
We decided to call everyone we knew who worked in Manhattan and owned a car. “Here’s the deal,” we said. “We’re going to pay you to drive into the city, plus we’ll cover your parking, gas, tolls, everything. You’re going to have to drive anyway. With us, you can make money doing it. You just have to agree to take some other people with you.”
We managed to put together a network of about 40 drivers — friends, friends of friends, relatives, friends of relatives, relatives of friends, you name it — and were ready when the strike began on April 1.
One of the important lessons to learn from this article is -
When in doubt, go to your customers. They will tell you what they want and lead you to solutions you’d never come up with on your own.
Handling such situations smartly is one of the keys to entrepreneurial success. Next time when we see such situation, we need to learn how to turn it into a business opportunity even though initially we may not think it as an opportunity.
Note: To read more articles from this series, please visit blog series: What Makes Them Entrepreneurial?
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Thanks for the info.Great Site!
JohnTey
26 Oct 09 at 11:44 am