Growing a Business

CHAPTER 1 Something You Live to DoWhen I started my first company in Boston twenty years ago, I had little interest in business. I was just trying to restore my health. Hindered by asthma since I was six weeks old, I had begun experimenting with my diet and discovered a disquieting correlation. When I stopped eating the normal American diet of sugar, fats, alcohol, chemicals, and additives, I felt better. I could breathe freely. When I tried to sneak in a hamburger and a Coke, my body rebelled. After a year of going from one diet to the other, I was left with a most depressing conclusion: if I wanted to be healthy, I'd have to become a food nut. I bid a fond farewell to my junk foods but then discovered that a steady diet of natural food was impossible to obtain without spending ten hours a week shopping at ethnic food stores, farm stands, Seventh-Day Adventist flour mills, Japan Town, and other distant vendors. The health food stores certainly weren't very helpful. For the most part, their idea of food included high-priced nostrums and vitamin formulas -- sold by women who wore nurses' uniforms and white hosiery that made their legs look slightly cadaverous.Tired of spending so much time shopping, I started the first natural foods store in Boston, and one of the first in the country. In the first year of operation on Newbury Street, it grossed about $300 a day and I had fun doing it. The smallness of the operation allowed me to feel close to customers and suppliers. When the business began to grow and I had to spend more time behind a desk than behind a counter, I enjoyed it less. As the years rolled by, the company made money, lost it, hired hundreds of employees, bought railroad cars, opened stores and warehouses on both coasts, set up wholesale and manufacturing facilities, flirted with bankruptcy, and engendered a host of lean and hungry-looking competitors -- some of them friends and former associates.Along the way I managed to commit most of the original sins of commerce. I overborrowed, understaffed, undermanaged, overstaffed, and overstocked. I managed to alienate most of my staff at one time or another, failed to delegate efficiently, and didn't know how to read the balance sheet. (I can read a balance sheet now, but I'm still capable of making these other mistakes.)When I sold the business after seven years, Erewhon Trading Co. was grossing $25,000 a day. That was in 1973. I departed the country and took up the pen -- something I had always wanted to do -- in order to write a book about a community in Scotland. When I returned to the States a couple of years later, with an Australian wife I had met in Scotland, I discovered another reason to go into business for myself: I was unemployable. I had not held a salaried job in my adult life, had no college degree, and my experience in running a company was not deemed sufficient qualification for a position in corporate America. I didn't fill any job description. I checked the want ads in the Sunday papers but didn't find anybody who wanted me to start a business for them. Not wanting to go back to college to get a job description, I went back into business. In the parlance of the day, I became an entrepreneur -- again.But only indirectly: at first I consulted and worked with companies in the food, publishing, and waste conversion fields, and I did three turnarounds for companies in deep trouble, one each in fashion, marketing, and energy. I wrote a book about the effect that individuals, as opposed to institutions, have on the future. After three years of free-lance problem solving, several friends and investors and I founded Smith & Hawken. That was eight years ago, and our office in Mill Valley, California, is where you'll find me today.This book comes straight from those business experiences. When I started the natural food business in Boston, my business knowledge was scant. I did the best I could and beganHawken, Paul is the author of 'Growing a Business' with ISBN 9780671671648 and ISBN 0671671642.