Reinventing a Business

UPDATED: September 24, 2011
PUBLISHED: September 24, 2011

Reinvention. For some individuals, the word may conjure New Age mysticism or spiritual journeys. For businesses, the meaning is more practical. “In order to stay competitive, companies today have to be able to reinvent themselves,” says Pamela Mitchell, founder and CEO of The Reinvention Institute and author of The 10 Laws of Career Reinvention: EssentialSurvival Skills for Any Economy.

“Reinvention isn’t a philosophy—it’s a form of business insurance.”

Business reinvention can run the gamut from rebranding or refocusing to an entirely new business model—or new business. Meet three entrepreneurs who successfully reinvented their businesses, and learn how you can do the same.

Bringing a Business into the 21st Century

As a Time magazine foreign correspondent in the 1960s and ’70s, Charles Eisendrath experienced the cultures of France, Chile, Turkey and Argentina, developing a passion for outdoor cuisine. Settling in Michigan as a professor, he designed the wood-fired grill of his dreams (dubbed “The Grillery”), found a pair of craftsmen to make the stainless-steel grills and sold them as a hobby under the name Grillworks Inc.

His son Ben grew up talking about grills at the dinner table, earning his allowance helping with his father’s “recreational capitalism.”

In 2007, the younger Eisendrath was working in product development at AOL and casting about for a career change. He decided to put his ideas into practice by reinventing Grillworks, which his dad had shut down in the 1990s. “I didn’t want to give up on U.S.-made, artisanal quality,” he explains, “but I wanted to bring the product into this century.”

Ben Eisendrath’s first move was to improve the quality. “I wanted to use higher-finish, higher-gauge steel, and [develop] built-ins and larger models that could be used by professional chefs,” he says. His dot-com experience came in handy for the first step: digitizing his father’s old shop drawings of grill designs. “It was some process getting those greasy drawings into digital format.”

Charles Eisendrath had relied on two local artisans to make the grills, but his son knew he had to scale the business, so he contacted stainless-steel shops for bids. Responses from shops specializing in winery equipment and vintage cars helped take the grills to a new level of quality.

Branding came next. Ben retooled Grillworks’ logos and graphics and started marketing—previously a hit-or miss affair when his father ran the business as a hobby.

Ben targeted his marketing budget narrowly, placing ads on sites frequented by his upscale, well-traveled customers, and using search-engine optimization to ensure customers looking for “wood-burning grills” would find Grillworks. But his primary marketing tool is word-of-mouth, since the grills aren’t sold in stores. Making sure customers love the grills, using testimonials and getting magazine reviews—then spreading the word through social media such as Grillworks’ Facebook page—has let former customers know Grillworks still exists and put the product in front of a new generation of barbecue lovers.

Staying lean has been key throughout. “We don’t carry inventory and we keep overhead as low as possible,” says Ben, whose work force ranges from five to 35, depending on the season.

Reinvention has fi red up sales. Grillworks relaunched in May 2007; sales tripled in 2008, then doubled from there in 2009, despite the recession. This year, revenue is expected to double again.

Ben Eisendrath says he’s “refining” rather than reinventing Grillworks, kicking up the quality without alienating any former customers. And refining will continue, being always mindful of the end user, he says. He’s excited about his new line of built-in grills and the commercial customers who now account for 20 percent of his market. “I’m trying to keep my eye on the prize, and the prize is this niche,” he says. “I want to stay in this niche and grow slow and steady.”

When One Door Closes…

Michelle Gamble-Risley’s corporate job in marketing communications was making her miserable. Her husband urged her to quit and start her own marketing business—so in 2006, the day before her 40th birthday, she did. “Working for myself, I tripled my income and was happier than I’d ever been,” she recalls. “I couldn’t believe how easy it had been!”

After a year in business, Gamble-Risley decided she wanted to help other people—specifically women understand that career change and entrepreneurship don’t have to be scary. Working with co-author Anne Marie Smith, she wrote Second Bloom: 10 Steps to Reinvent,Rejuvenate and Realize a New Life, published in January 2009.

Second Bloom garnered Gamble-Risley literary awards—and a new business partner, her friend Michele Smith, who was so inspired that she quit her job to join Gamble-Risley at M Communications. Little did Gamble-Risley know that Second Bloom would also lead to a second flowering for her business.

In June 2009, the recession hit M Communications hard. “Several of our major marketing and PR clients fell off suddenly—their budgets were just gone,” Gamble-Risley recalls.“It was an ‘uh-oh’ moment.”

But at the same time, authors began approaching Gamble- Risley, asking her to publish their books. “It was a dream come true—and also the obvious solution,” she says. So Gamble- Risley and Michele Smith launched a second business, 3L Publishing, that provides end-to-end writing, editing and publishing services.

Launching a second company while your first is struggling might seem counterintuitive, but the move actually made a lot of sense. Gamble-Risley had years of experience in publishing, and since authors need marketing and public relations, 3L Publishing’s clients generate new business for M Communications.

The process wasn’t without some trial and error, Gamble-Risley says. “We had to figure out the revenue stream for the publishing business. It took about three months of trying different strategies until we found the right formula.”

3L Publishing now follows an agency model. “You get the book, national distribution into all the major bookstores, a website and PR—we call it ‘business in a box,’ ” Gamble-Risley says.

Another challenge: figuring out how much work they could handle without hiring. To cut costs, they have two full-time employees—a graphic artist and a Web designer—and scale up and down as needed by contracting with a pool of professional editors.

After launching in July 2009, 3L Publishing was in the black by August. The partners hit a stumbling block in October when some key clients defaulted, prompting them to retool their business model again and require payment for editorial work before the book goes to press.

Today, 3L Publishing is on its 15th book and has had a top-seller on The combined companies project $500,000 in 2010 sales. As the business grows, Gamble-Risley and Michele Smith plan to write their own books and do less day-to-day editing. A screenplay they’ve written, now under consideration by Tom Hanks and Rita Wilson, could finance that goal. (Gamble-Risley has sold two prior screenplays.)

Gamble-Risley’s advice for other entrepreneurs in need of reinvention: “Sit down and figure out what works and what doesn’t. If something’s not working, don’t hold onto it.” For example, she and Smith network regularly, “but we assess how many clients actually come from each [networking] group, and if it’s zero, we quit going.”

Reinvention requires hard work and being open to opportunity. “Doors will open for your business, but you have to walk through,” she says. “Don’t shut the door on yourself. Be willing to say yes.”

Reinventing the System

Most people who buy franchises don’t want to reinvent the system—they just want to execute,” says Mitchell York. But York isn’t most people.

A longtime corporate executive, York was laid off after 9/11 and realized he had no desire to get another job. “It was a midlife crisis,” he jokes. He explored business ownership and, in 2002, bought a Maui Wowi Hawaiian coffees and smoothies franchise.

At the time, Maui Wowi offered both a retail and a mobile option. York, who lives on New York’s Long Island, chose the mobile option, selling smoothies and coffees from kiosks in malls, stadiums, events and arenas. Yankee Stadium was his first account; others soon followed.

But York quickly found the mobile business model had shortcomings. He was working long hours, driving all over the place and struggling with unreliable employees. The business was successful,but he wasn’t happy.

The New York market also presented unique challenges. “There are lots of people in New York, but not a lot of places for huge crowds to gather,” says York, who realized the mobile option couldn’t fulfill his financial expectations.

Instead, York, who grew up in a family catering business, reinvented Maui Wowi for the New York market by catering private, college and corporate events. Today, Maui Wowi offers the catering model as an option for all its franchisees.

How did York reinvent a franchise system—something most franchisees (and many franchisors) consider as set in stone? The first step was getting the franchisor’s OK.

“One reason I chose Maui Wowi is that the people leading it are entrepreneurial,” York says. “I could tell they would always be willing to listen.” He made a business case for the catering model, showing the franchisor how it would cut overhead and boost margins.

While getting franchisor buy-in was surprisingly simple, York faced other challenges: finding mobile equipment suitable for catering, finding and training new franchise owners to take over his locations and events, and marketing to a completely different customer.

“In the retail model, the customer is in front of you with a $5 bill. In the catering model, the customer in front of you represents thousands of dollars. The standard of service is much higher. A retail store [employee] can have a bad day, but your employee can’t have a bad day at someone’s wedding.”

To reach that higher service standard, York coordinates with a network of area franchisees to cover events. For instance, if he lands an account in Boston, the Boston franchisee will work the event. With just two employees on payroll, his overhead is minimal.

Since York switched to catering in 2005, his franchise has grown from 20 regular clients in 2006 to more than 150. But those aren’t his only clients. York is also a professional certified coach who has helped more than 100 clients, typically midlife corporate executives, in renewing their lives through small-business ownership. He has also written a book, Franchise: Freedom or Fantasy: How to Know if a Franchise Is Right for You After Your Corporate Career.

York’s secret to innovation? “I always look for new ways to be of service and value to my customers,” he says. “When you take the time to care, good things happen.”

If you’re a franchisee dissatisfied with your franchise system, York says, “It’s always possible to change the system if you have your facts together, use [the franchisor’s] chain of command effectively and make a strong case to top management.”

Whether you’re a franchisee or independent business owner, continual reinvention is essential. “If you don’t reinvent yourself,” he warns, “someone’s going to reinvent you out of business.”