Unlock the secrets behind the phenomenal success of Battlbox with our special guest, John Roman, CEO of the booming outdoor and survival company. Journey with John from his humble beginnings as a small-scale investor to becoming the driving force behind a major e-commerce platform. Discover how Battlbox's innovative shift from subscription boxes to full-scale online retail, their growth during the pandemic, and their hit Netflix series "Southern Survival" propelled them forward. John also shares candid insights on the company's strategic acquisition and buyback, providing a real-world look into the complexities of business valuation and ownership transitions.
But that's not all—we dive deep into the financial strategies that can make or break an internet retail business. Learn the critical importance of tracking financial metrics, budgeting effectively, and evolving from basic tools like QuickBooks to more sophisticated financial management systems. Plus, get inspired by our discussion on leveraging short-form vertical video content to engage customers and build a vibrant community. Whether you're a seasoned retailer or just starting out, this episode is packed with actionable advice, cautionary tales, and the firsthand experiences that can set you on the path to success.
Transcript from Audio:
Intro: Welcome to the Adventure Retail Podcast, your go-to destination for all things outdoor retail. Join us as we embark on a journey through the captivating world of outdoor gear shops, exploring retail triumphs, challenges and everything in between, from product sourcing to customer engagement strategies. We're here to support and empower outdoor gear retailers every step of the way. Here to support and empower outdoor gear retailers every step of the way.
Dale: Today we've got John Roman on from Battlbox. Happy to have you, John.
John: Okay, glad to be here Good to see you again.
Dale: So, and John, we've been lucky enough to have an hour and a half of amazing conversation in the last two weeks, and I'm really excited to. I think it's set it up really well for this conversation. I know a whole lot more about you, sure, and I'm excited to dive in and and share your story and expertise with everybody. If you could start with a, give us a one minute intro to who you are and what Battlbox does.
John: Sure, so my name is John Roman. I run a company called Battlbox, so Battlbox is an outdoor and survival company. So a giant part of our revenue is a subscription box, a mystery box, but we don't look at necessarily that lens, we're just outdoor and survival experts. So we're spreading content, building community, really showcasing the great outdoors and educating while doing that, and we do happen to have a monthly subscription box that we send out. We also have traditional e-com, so probably about 600 SKUs, and we're almost solely direct-to-consumer on our website.
Dale: I love it, man. I love the clarity of we're outdoor and survival experts and we happen to have a subscription box.
John: Yeah, it's a different approach and a different lens, but it's how we behave and I think it's the correct one.
Dale: Yeah Well, yeah, no, it having that as the frame and the foundation, you act differently. I'm an outdoor shop, OK, so you sell outdoor stuff. No, we are experts and we provide, Anyways. It just kind of gives me chills a little bit. I, I love that clarity. Um, so you, uh, and because I had the, we've had conversations so you, um, well, let's, let's share the with the listeners a little bit. Um, what got you here to be the CEO of Battlbox? If you could give us the quick story of you know of how you got to where you're sitting, so early, early 2015,.
John: I was investing in companies very small, small check size, not traditional investing Definitely like people in my network that I knew, made a few investments. I made a few investments Battlbox I found out about a week after it had launched and made an investment. The plan was limited capacity, a couple hours a month of, maybe, business advice, business acumen and a board seat, and it just quickly became a lot more than that and I was putting in a lot of hours. It went from five a month to five a week to five a day fairly quickly, and then it even grew greater than that and about a year in, I made the decision to join full-time in the capacity of a CMO, overseeing marketing, customer experience and technology. And we just kept growing. Everything just kept getting bigger and bigger. We hit, you know, like a lot of direct-to-consumer brands.
John: The pandemic was not necessarily a bad thing for the business. We saw a nice uptick in sales and then we parlayed that into so you have to think, the sales started to increase in March, april of 2020. And then our parlay was in July, we had a Netflix TV show drop, a Netflix original series called Southern Survival, and that just further shot the hockey growth, hockey stick growth up. And then there were three of us originally four, down to three principals of the business at that time and we just we weren't aligned. Two of us wanted to keep building this into something amazing.
John: Um, one of one of us was ready to retire and and be done with with work and it just it didn't make sense, um, from an economic standpoint for the two that wanted this data to acquire the third's equity, just simply because what might make sense to a large company from like a multiplier and valuation, probably doesn't make sense necessarily to just some individuals. So we found what we thought was a great partner, publicly traded company, and they acquired us in 2021. At that point, I took over in the CEO position my previous business partner was the CEO at the time and then fast forward, did that for about a year and a half year and a half just stuff outside of our control and our parent company's control, just with the markets and being publicly traded. There was an opportunity in April of last year we acquired Battlbox back from them and took it back private and that's where we're at now.
Dale: Yeah, Can I give not necessarily the details on the buyback but just the details of the sale? Can I give that high level real quick?
John: Yeah, absolutely.
Dale: So because I think it's, it's interesting for people. Uh, you hear crazy numbers and multipliers around things, so people are it's really hard to know like what is my business worth. And so I think it's interesting. You were able to you know place and you were. You were saying which I think is super cool Like you were making two, five, $10,000 investments right as a sales professional, with your extra money. You invest in battle box, you know, get involved and eventually you know, now you're the CEO, you sell it. You grow to 18 million in revenue with a $3 million EBITDA and you sell it for about six X that profit EBITDA number for about 18 million, where if you were only a million in earnings, it may only get a three or four X.
John: Correct.
Dale: Multiplier, but because you took it from one to 3 million in earnings. That's what got you the extra multiples.
John: And if we weren't 18 million, if we were over 100 million in revenue? All of a sudden it's a new equation and we might not even necessarily be looking at EBITDA we might actually be able to get a multiplier off top line. It's a wild different. There's different tiers, right yeah, on where you're at and what you can get out of it.
Dale: And and my expertise in familiarity is mostly in that in that, you know, you know, a few hundred K up to a few million is where I'm comfortable to say it's probably like that. But yeah, you hear this crazy stuff like, hey, there were a hundred million and they sold for 200 million bucks and you're like, but they probably only made 10. It's like a 20 multiplier. I don't even. It blows my mind. So thank you for sharing that. Um, going back a little bit to what you said hey, we're a product and we're a outdoor and survival experts. How long has that been the the theme? How long has that been? You may not have talked about it in the same way but how long has that been?
John: You may not have talked about it in the same way, but how long has that been a part of you? I would say it was a part of us, probably starting in 2017, 2017 ish. So, you know, initially, off the jump, we didn't know what we didn't know. We didn't know what we didn't know and, you know, none of us had any experience in direct to consumer e-commerce, Truly, building a brand like this. This was all of our first first rodeo with with that Wow, when, when you know, in 2016, towards the end, we brought on a creator, brandon curran, um, who was he was a paying customer initially that was doing reviews on his youtube channel. We were seeing a lot of um customers coming because of his videos. So he joined the team in a full-time capacity and and moved down to georgia, um, with the sole focus of we're going to shoot more content. He was doing one 30-minute video a month. We were going to say, okay, well, if you're doing this full-time, let's just start cranking out content.
John: And it was at that point where we knew content was important and we just made a conscious effort at that point. Yes, we had the subscription box. Yes, we talk about it a lot, but like it's bigger than that. You know we saw that there were these formings of community. We had a Reddit style bulletin board at the time. Now it's been converted.
John: It was called the Battlbox. Now it's been converted to a Facebook group where you have to be an active member to be in. It's been converted to a Facebook group where you have to be an active member to be in. But seeing the community and the engagement level, seeing the opportunity with Brandon joining the team and really getting to spend every moment of his working day on content, it just seemed that that was the right direction, that let's just focus on what we all enjoy and when we know there's a lot of other people that enjoy, which is the great outdoors, and everything else will just kind of fall in place. Don't get me wrong. We spend a ridiculous amount of time in spreadsheets and formulas and figuring out the economics of the subscription box and acquiring new customers, but still the focus isn't necessarily that from the from, from the outside.
Dale: Yeah, so tell me, cause that's nice and it all sounds amazing. Sure, um, and, and I would. I would love to think like hey for grand trunk, like I want to run a content company. I'd much rather you know I love adventures. I would love for our to convince our to go upstairs after this call and convince Paul, our marketing director um, that man, let's go in. And I've actually. For years we've had that conversation. I've kind of been more of the proponent. We're working on product mix and other things, but how have you seen that affect your bottom line from a sales perspective and like an engagement perspective, can you share anything with pre-2017? Here's kind of what our engagement was and then, once we really invested there, how it changed yeah, so it was a.
John: It was a slow build. Obviously the the the netflix show, you know changed some of the traffic a little bit, but it was a. It's, you think, traditional direct-to-consumer e-commerce. They see an ad, you're trying to get them to buy, right. Then, um, it's very transactional and you know you're looking for, you know, specific kpis on conversion rate and and cpms, um cost per click, and then it was a slow, slow, slow transition. Now you look at it don't get me wrong we run a lot of ads, um, but what we've found is, instead of trying to, in a transactional manner, close someone immediately and get them to buy and hope that they that we set proper expectations we see this this longer um in the tooth.
John: 50 of our customers um know about us and are following us to engage with us for greater than six months before making that first purchase. So it's uh, they're engaging with you for six months before making that first purchase.
Dale: So it's uh, they're engaging with you for six months, six months beforehand.
John: Um, but it's, it's just a different sale, right? So, yes, we do advertise a lot, but it's, it's a it's a longer process. A lot of our top of funnel is organic and they come in organically through YouTube or TikTok or other social channels and they subscribe to our email, they follow us and watch our videos and eventually the advertising does work. But even if, like, we're targeting, we're in Facebook and trying to target and prospect new, the reality is even prospecting is a lot of times just retargeting for us. Yeah, moving them along the funnel how are you so?
Dale: how? Organic is a great way to track that. Like. These are people and I don't want to get too technical because, um, your, your business model is a lot more technical than a typical from as far as like the online sales side, than a typical retailer. A lot of retailers have online sites and so on, but that's your bread and butter. You live and die on on that. Organic is a great way to track that. Like how, as you, as you and all of your content, enabled your Netflix show right, so that was the reason it happened.
Dale: How, uh, how, did your? What was the main thing that changed? If I'm a, if I'm just an accountant and you're justifying to me, we invest more in content and community. Um, in our last call, you said content, community. That's some of the core things we, you know we focus on. If I'm an accountant and you're trying to justify to me that that's a good strategy and that it worked, is there anything would you say like, well, hey, look, our organic or our conversion on paid went up, or our, which is always changing, or our organic changed in a meaningful way, or what kinds of things would you mention?
John: Um, I, I would. I would point to lifetime value of the average customer, the amount of money from their wallet that they choose to share with us. It goes up significantly. And it's interesting there's direct correlation between the customer that came into us organically, looked at us and made a decision over six months to purchase, versus the guy that saw our ad yesterday, bought yesterday. Their OTVs are not going to be the same, yeah, yesterday, their LTVs are not going to be the same. Setting over half a year or greater, setting proper expectations, letting people know what we're genuinely about, what we're trying to accomplish, and there's no like buyer remorse after six months. You know what you're buying into, you know what you're joining, you know what this membership's about. So it's such a a more valuable customer.
John: Um, because it's the farthest thing, it's a, yes, it's a transaction but it's not transactional, it's, it's great, um so it's, it's, it's higher ltv, which, at the end of the day, you know, know, means means more revenue, means um more profit, more, you know, it raises all ships.
Dale: Yeah, so higher lifetime value. Um, you, you've been able to see that increase as you pumped in your yeah, yeah, I love it Awesome. So one of the uh, one of the common struggles for a shop and and I guess my background is internet retail, selling online. It was mind-blowing to me, so let me share. And then I want to get your perspective on this.
Dale: We had a distributor who consolidated a bunch of financials from other shops like ours, other online retailers, and they broke it down into payroll as a percentage of sales. You know, fixed costs as a percentage of sales, or rent, you know like. You know rent as a percentage of sales, marketing as a percentage of sales, shipping as a percentage of sales, and as basic as that sounds. And we were making money, we were profitable. But it kind of blew my mind like, oh, wow, tracking it like that deal.
Dale: Your payroll is a percentage of sales, 14% where based on. You know, to get you to an eight or nine margin in retail, you need to be at you know 12. Right, where. But when my, when my employees are saying I need to make more money, they're like well, I really want you to make more money too. I care about you, I want you to be here, but then when you know in the background, well, we have to be 12th, we need to work towards getting to 12%. It just really helped us out and we made a lot of different decisions based on that. So is there anything similar or other advice that you would share to a retailer to get a better handle on their profitability?
John: Yeah, so I think what you said is paramount Now. Did we do that back in 2016? I wish we did not. We didn't know what we didn't know. Today, we absolutely manage everything to percentages. We know that our marketing spend is not going to be greater than 12% of our total revenue, which some people are shocked that we don't spend more than that.
Dale: I am shocked. I am shocked.
John: But we don't go more than that. I am shocked. I am shocked.
Dale: But we don't go above it.
John: That's the budget. Now there's one-off situations throughout the year. We find a campaign that's working really well and we know that it's going to make it where that spend is less than 12% in the in the following six months because we're we're we're going top heavy. Now there's, there's one offs and ebbs and flows but it's a budget.
Dale: Yeah, I think. How have you budgeted in content? How have you, how do you look at that spend within your financial umbrella? And and I guess I asked that like um A common theme of shops, and I'm excited to have more of these conversations. But, man, it seems like those shops that I was always jealous of or looked up to when I was in the bike business. I'm like man, they are the ones that have built real community, that have a real reason to exist outside of. They just are stocking product in their town.
John: Sure.
Dale: Right when I'm curious how people would see that investment on their P&L, because it's probably closely related to a marketing expense.
John: Yeah, so so a lot of us marketing, but like our team members that are in the marketing, they're just on traditional payroll. We're not. We're not isolating that. We know that. You know we want to be at, you know, 10 percent or less for payroll and yes, it's heavy with marketing people. Yeah, but it's not isolated and not separated at all.
Dale: Yeah, cool. It's funny how similar all of this is. You're like, hey, we need to keep marketing at 12. And I'm like, yeah, marketing for us back in the day was was 10 to 12 percent, right, you know uh blended that are.
John: That are 20 that that recommend.
Dale: Oh, you need to be at 20 or 25 percent, that's, that's tough yeah difficult well, it's a quick way to make two percent net margins, you know, and it's a quick way to be out of business too, yeah, and I guess, if you've raised money and it's not your money, you tend to maybe look at things slightly different yeah, okay. So so you're doing very similar. You're bucketing it into. Hey, our payroll expense is x Marketing spend. We keep here. We're willing to make some variations. How did you track that initially?
John: So I mean, when I look at where we've come from, call it financial astuteness in 2015 to now is vastly, vastly, vastly different. So the first two years we didn't have anybody that was necessarily the head financial person. We were all kind of wearing the hat and the hat didn't fit any of us and we weren't tracking things very well. We had a couple of spreads. She's obviously like we were using QuickBooks.
Dale: You knew you were growing profits each month.
John: Yeah, but man we were making we made some wildly poor decisions in those first first couple of years.
Dale: Can you highlight a funny one for us? Can you highlight? I think it is important, for sometimes if you say John and team built something from scratch to 18 with a five or $10,000 investment, you know he comes in and then they build this to $18 million. That's a crazy wild success story, right? And? And sometimes you say, well, they must be geniuses and um, but it's, it's so. That's why I think it's even more important to share, like, look how funny this, you know, can you, can you believe we did this? But you grow on top of all those stories and while the stakes are small, that's when you need to make the dumb mistakes anyways.
John: Yeah, no, it's true. So because we didn't have that financial, we didn't have that person that owned finance, right, there wasn't that single person of accountability. We obviously have to get our taxes done. Every year we send them to the cpa, but we're we're just sending them an x, we're not giving them the full picture. They don't understand the business fully. Um, it's become a complicated business, has become very just. You know, black and white on paper. Um, so the cpa to, to no fault of their own, they're working with what they've been given. It's definitely our fault. It's like, hey, you guys need some more expenses, like go get some cars. So I remember vividly we're about to fly out to Salt Lake City and we're going out there to meet, we're going to shoot some content with Black Rifle Coffee.
Dale: They've killed it right. Black Rifle's, another company. Who's just killed it.
John: That's an interesting story, all the different iterations and chapters and just some of the things they've done. But they're publicly traded and now they're putting brick and mortar up everywhere, um, which is, yeah, so cool, it's uh, so we're going and, um, this is the recommendation from the cpa. And you know, they're obviously smarter than us and we're we're naive and thinking that we haven't shared all of the correct picture of of the business with them. So we're, the three of us, are sitting at the airport talking about this and, well, I guess we should get cars. Well, okay, we didn't, didn't talk about budget.
John: My previous business partner that he that was the ceo, daniel. He was like, well, I want two cars. And we're like, okay, cool, you get two, we'll both patrick and I'll both get one. Um, and within, literally, we got back from salt lake city and daniel called me. He's like hey, will you go down to miami with me and drive these two cars back? I was like you already found cars. This is on my to-do list, but not immediately. I didn't think we were moving on this that fast. And that week I flew down to Miami with him and he drove this Corvette back and I drove this Range Rover back up to Georgia. I then I bought a BMW 650i. It was just not like an unsight, it was just wildly inappropriate.
Dale: That's really funny.
John: But it was because of you, know. We didn't understand fully.
Dale: You didn't understand the principle behind. Like what do you mean this thing, like just why that would happen. So, going back to hindsight, what do you do differently?
John: So, not that. So the reality is, you know, this business is very cash intensive at times, right? So at the end of the day, the membership is a big part of the business still, and the bigger we've gotten, we're having to work out, you know, months and greater in in advance and putting in purchase orders. Um so it, yes, we're, we're gonna, we're gonna buy something today. Hope we're right on the forecast and the number. It's not like we can, because these are custom manufactured, runs from these vendors. So you can't like say, oh, just kidding, I told you this, but I only need this, like they've already, they've made them and we're going to pay. You know, six, seven months sometimes before we're going to get paid ourselves. Yeah, so we're, you know, putting out millions of dollars, possibly every month. So it's, it's cash and you get the cash back, obviously, but it's not something we should be trying to add. Additional OPEX for cars.
Dale: So you're just taking some income, paying the taxes and stacking cash away.
John: Yeah, yeah um yeah, so we were. You know, we were um. Another laughable moment is we were taking the first, first year taking distributions. Um, well, we were, we were thought they were distributions. We couldn't take distributions when you have a negative basis, um to like what were we doing? So, like we had years where, like that was basic had to basically sit on our books as a loan because it couldn't be a distribution, because there wasn't anything to distribute. Uh, it was just just wild, just ignorance, if you will.
Dale: Yeah, in the beginning yeah, no, well, that's it's good to. It's good to point out. Um, I know that I made. I hate, I hated paying for professional services. I was really cheap and we had done my. My dad and I were in business together. We had done.
Dale: This was 2010. Um, we probably did 4 million in revenue and made about $550,000. Maybe we did 5 million bucks, made 500 K and we were still filing as a partnership, as an LLC. A year later they said, you know and I, we benefited cause we could go back and fix some of it.
Dale: Um, but and it may have happened, you know I might be getting my timeline wrong but we talked to the accountant and he says both of you should be taking a salary of, say, 65k back then and then all profits above that won't have self-employment tax If you file as a C-corp. You can stay in LLC If you file as a C-corp. So I'm immediately seeing what I put off spending a hundred dollars in consulting with the CPA and we, we lost $40,000 in taxes, you know, two years ago or whatever it was. And I'm thinking, man, where just to not know that was hard, and you hear that a lot. That's so common. The one that you mentioned with the car, like, hey, you should just buy a truck. You're showing too much in profits, buy a truck.
John: There's more and if the plan, yeah, it's just not, it's not a fully, if it's a lifestyle business and you're not trying to do something bigger, greater or have a larger end goal, sure.
Dale: Yeah, make no money every year, just make no money. And there may be some shops out there that say, hey, our goal is, in order to keep the bank happy, if we do have bank loans, we need to make a cash coverage, debt coverage but other than that, we're going to program our profits and whatever. But yeah, that's. I think having a good cpa that's going to watch your back and protect you is really important. Yeah, that's savvy um. So I guess that knows your goals and such Um and and and you know, the, the, the CPA that we used had our best interest.
John: We just never. They didn't know what they didn't know Right and we didn't. We didn't offer the correct information or any information.
Intro: Yeah.
John: So it's it's tough to do your job when you don't have all the pieces.
Dale: Yeah, for sure. Um, so well, that's awesome. Um. Another thing I wanted to get into was the and we've talked about it a little bit but community and content going, maybe just going back to that, like, if I'm a, if I'm a retail chain and I was just on the phone with somebody that are retail chain, they've got five stores, um, and they, you know, want to find ways to add value maybe through that community content piece. Like, what does that even look like? And I, I'm real, that's not, I'm not asking that in a very clear way but for somebody to uh focus more on on community or creating content, like, what are, what are some of the steps that you might recommend?
John: Sure, so so the the the community piece is a is a little bit of a? Um, not straightforward answer, but you can, but you can. You can get a lot of the answer and guidance that you need from content. Um, so, on the content piece, you know if we're talking about. Hey, I'm a retailer and it's 2020, it's may 2nd 2024. Like I, I don't have any content. I need to figure out content. Um, you know all the algorithms on the social channels. Um, all still treating short-form vertical video content as the best type of content.
Dale: That's funny. You say that Short-form vertical content, not landscape vertical the phone.
John: Um, yeah, you know when, when tiktok came on the scene, uh, a few years back it, they, they quickly became a force. So you have, you know, google and uh and and facebook, instagram, overcompensating on their platforms for the type of content, because, because the reality is, consumers enjoy that content, it's easy to digest, and if you're putting that content on those TikTok Instagram Reels, youtube Shorts, if you put out content like that on those channels, you have this ability, if it's actually good content, to hit this virality piece, and the virality piece is just simply more eyeballs and you can quickly, um, quickly become, have something, have an identification on there where, like, um, you're starting to get more people following and and understanding and engaging with you. Um, and if it's just genuine content and you know certain things are going to work for different brands and certain people, but once you find your voice that people identify with, the engagement can kind of probably lead you down the path of what that community should or will be able to look like yeah, I like that.
Dale: So leading with content and then responding.
John: Yeah.
Dale: In a way.
John: Yeah, responding appropriately. Now, your, your, your. Your audience, members or followers or customers will always tell you what they want. If you just listen and if you, if you do want to build community, they're going to tell you what, how the community should be. You just have to listen and engage with them and ask yeah, be you just have to listen and engage with them and ask questions.
Dale: What tips do you have for people who want to start paying for some ads and I'm not talking about advice to run like campaigns at your scale, because that's a whole other business that most shops like you'll live and die on that. But if somebody says, yeah, I probably should pay in a little bit to boost some things, like like what do you tell that shop that is starting to create some content and wants to do a little paid media?
John: um, I mean the. The platforms make it really easy. Now, right, you literally can, um, you know you don't have to be. Yes, you can go the traditional way. Open up facebook business manager, connect your page, create an ad, add an asset, put some copy, set a budget um, a url, target to go to the website. You can go that way, um, and that way is is 100, an absolute solution. But the platforms make it really easy.
John: Can open up tiktok right now, or instagram, and you can go to any of your pieces of content and there's a boost button or a promote button, and it's super streamlined. Next, next page will tell you what are you trying to accomplish. Are you trying to get more likes or followers, or are you trying to send them to a url or a website, um, and next page is is how long is is running and how much are you spending, and within um, within a couple of minutes, you can, you can boost or promote um one of your pieces of content, and it's most of them. Most of the platforms also are able to track um to a certain degree and tell you what, what was accomplished and, depending on your size, you can probably notice was accomplished and, depending on your size, you can probably notice, notice, if, if, if there was something, yeah, yeah, that's awesome.
Dale: So one last thing, Um, and then if there's anything else you want to add, you know, feel free to add it, but the uh, you'd mentioned that you had bought a shop and then you ended up selling it again, and that was you know. I'd love to just hear that experience and if you had a takeaway on here's what I learned about doing. You know, as an internet retailer, you know, online content creator, media company, almost with a Netflix show, my experience jumping into a shop and jumping out was, you know.
John: Maybe here's what I learned a shop and jumping out was you know, maybe here's what I learned, sure, so you know. So back then had a theory Um, and I still think this is this is the truth that um, direct to consumer is just a sales channel. Um, it's not. It's not the full picture. I think that, and I hate saying the word omni channel, um, but it's. It literally stands the hair up on my arms. I hate that word, but the reality is but, John, you got to be omni-channel.
John: Okay, I'm just kidding yeah, but it's the reality is. Direct to consumer is just a channel. So, you know, I still believe that we're still working on the uh, the correct, the, the correct retail model and it's not what we thought it was at first and that was, I guess, 2017, 2018? I'm trying to think no 2019. We made an acquisition in 2019. So we knew we wanted to have a retail presence. Now, I believe a retail presence is not a Battlbox branded store, but Battlbox products in other people's stores.
Dale: It's a private label. That's another thing and I wasn't going to jump into that too much, but is that something you're working on? And developing your own Battlbox brand?
John: Yeah, so we have a lot of branded products now and we have some health brands now and we're actually in the midst of putting together a more pretty-looking, graphic-friendly catalog of our products to take to retailers. But we didn't necessarily know that that's the right approach. Now Go to 2019, we saw an opportunity where it was a business that Flashlights and Camping Gear, so right in our wheelhouse, where they had a nice online presence, really nice website, respectable amount of traffic and sales. But they also had a traditional brick and mortar store and it was in Georgia another site and then retail. We can have all of their products. We can also have our products Like this is great.
Dale: It's the best of all worlds and everything's going to be a honeymoon forever.
John: Completely false. I've been there.
Dale: I've been there. I've been there before, yeah, yeah, too many times, and we just you know we had become good, and arguably very good, at direct-to-consumer online e-commerce.
John: And pure naivety. Again, we were under the impression that, yeah, you know, selling retail, that's. How is that any different?
Dale: Clearly, you're going to kill it. You're going to be a master at everything else you do, because you, you know, and everything you, everything else you touch, will turn to gold.
John: Right, clear, clearly we're wrong with that approach. And there's just so many other nuances. Right, there's, yes, there there's staffing, management of people in other businesses, but staffing for a store is completely different and it's a completely different approach. And inventory management is completely different. Instead of hundreds of a specific product, we might only have three or four of this and have more SKUs as opposed to less, in greater amounts and just understanding. Um, you know, the great thing about direct to consumer and digital is you're able to, even in a post iOS world, you're still able to track stuff to a certain degree. Like it's not that easy to track stuff and and getting, and it's not as simple as just running some facebook ads to get people into your store. Like it's a. It's a completely different animal. It's a it's. It's a different species.
John: Yeah, and we, just we just got our teeth kicked in. We, we just didn't know what we were doing and while we, for the most part, are arguably semi-intelligent, the learning curve was just, it was a lot and I think we could have figured it out, but in order to figure it out, it would mean we would take our eye off the ball of what we knew was working in our current core competencies. We couldn't have figured out both and we didn't. You know. We could have made some hires that that came from that world and maybe put ourselves in a better shot, but it it was becoming a pain point and a frustration and we saw an opportunity to arguably cut our losses at no real loss, and we took it.
Dale: That's a big win. I laugh and kind of joke with you about that because I've been in that place a lot of times and one of the best businesses I sold I I sold it for like $2,000 down and I'm going to get another $8,000 after. It was a small project that I paid 50 K for and it was the best sale ever and probably my most favorite forty thousand dollars to lose. Actually, yeah, because it was like, oh, just like, get it away from me. I don't even care, just get it out of my life.
John: It was a bad decision, oh you know, and it's then, and then that's a win.
Dale: You were able to to move on from it with yeah, with some learnings probably lots of, lots of learnings and a lot of it are those things, a lot of those of like taking your eye off the goal and realizing. On our last episode, actually, with paul he mentioned, you know we talked to retailers who are, hey, I want to get into online, I'm going to do it online, totally, do whatever you know, great, do that. Do private label, you know, build whatever dream business you want to, but just realizing that they're their own businesses with their own problems and struggles, and you can't just spin one up with your aura and expertise to just like go and succeed because you're some special deal and yeah, I've learned that with certain. Yeah, there's a lot of complexity. So, well, that's cool and I'm glad you were able to get out of it without you know, just getting your teeth kicked in is a good thing compared to losing, you know, losing an arm or dying in the process.
John: All of it is still present, so yeah To win.
Dale: Yeah, yeah, that's awesome. Um well, John, it's been really awesome spending this time with you and learning more about kind of how your mind works and props on everything you've done with battle box yeah, we talked a lot about the mistakes we've made, but that mistakes are important yeah, well, well, and it's all.
Dale: It's all a part of growing a company to 18 million in revenue, selling it, buying it back. You know, dealing with COVID in the transition, which was crazy, and still being in business, paying your vendors on time, right, paying your vendors, even like, just like. There's a lot yeah, there was.
John: There was in the first couple years, just us not doing what we're we? We paid all of our vendors but we were. We were late sometimes and it was because we didn't know. It was the naivety of of managing cash flow correctly. Um, yeah, that's a whole nother I could talk about the learnings we took from that.
Dale: That's a whole nother I could talk about the learnings we took from that Getting someone in place smarter than us on the finance side, though, was such a good move. Yeah, in my business, I was partners with my dad, who I took all the credit as the entrepreneur. I'm the guy that's buying, I'm the entrepreneur, I started the company and I, you know, definitely took too much credit, but he was the steady force behind paying everyone on time, and only after selling the company did I realize, oh, wow, like, not everybody acts like that. Of course, people wanted to work with us, because we always paid our bills, and the three times we were late, it was like a phone call hey, I'm going to be three minutes, I'm going to be three weeks late.
Dale: Is that OK, right? And? And people like, oh, that's fine, realizing now as a brand, you're like wow, we were a dream customer dream. So I think you're right. Is having somebody responsible there that will maybe fight the rest of the company to? We've dealt with plenty of people who just, you know, tell that story of hey, we got to meet with accounting and I'm not going to slander anybody on this call, but it's amazing how far that goes. And if and that's what will happen, though, if you don't have your numbers in in line, if you don't know your model and have your outfit put together right um, you're running your challenges like that yeah, awesome.
Dale: Well, hey, thanks for spending the time with us, John.
Intro: Thank you appreciate it thank you for joining us on the adventure Retail Podcast. Until next time, keep exploring.