Episode 142: Blue Sky Marketing, The Resiliency of Family

Welcome to Skucast, the podcast for entrepreneurs in the promotional products industry. Skucast shines a light on our industry's best work, features maverick personalities, and discusses what's really involved in running a modern promotional products business. Skucast is the official podcast of Common Skew. How did you define those roles? Did you just sort of understand and fit those? You had those passions.

If it was hard, Corey did it. Anything else, we would just divvy up.

Yeah. And I would go on vacation.

We encouraged my dad to travel as much as possible.

Is that the secret? That's how the family business works?

Yeah, that's the hot fudge on the ice cream.

That's great.

Just go away for a while.

Blue Sky Marketing was founded 23 years ago by President Elliott Zurlin and has since been a family-run business with sons CEO Todd Zurlin, VP of Business Development Corey Zurlin, and VP of Sales Brady Zurlin. Locations in Cardiff, California, Carbondale, Illinois, Denver, Colorado, Tucson, Arizona, and Austin, Texas. They have a high-touch service and a relentless work ethic that stems from Elliott's influence. They've also experienced multiple setbacks, including a challenge 2 years ago that disrupted the business but also caused the family and the company to rally together and work through it, culminating in their best year ever in 2019, which is a great object lesson because this conversation was recorded in late January before the challenge of the coronavirus and the subsequent economic fallout hit us all. Throughout the Blue Sky journey, resiliency has been the hallmark of their operation. It was my privilege to sit down with the Zirlin family and explore what has not only held them together as a family, but what has allowed them to rebound to success time and time again. This episode is brought to you by CommensCube, the work-from-anywhere platform that powers your connected workflow, enabling you to process more orders and dramatically grow your sales. To learn more or to begin your free trial now, visit commonscube.com. Now here's my conversation with the Zirlin family— Elliot, Todd, Corey, and Brady.

Your business journey now, family-owned business, and let's start with where you're at. Corey, where are you at now in terms of the growth and maturity of the business? Revenue, if you're comfortable, if you guys publish that at all.

After 22 years, this is our best sales year ever.

Wow.

We've had year-over-year growth, but this is the best by far in 20-plus years.

Wow, that's fantastic. And, and tell us, Elliot, how did you start this business?

Well, it goes back many, many years ago. Um, I— a friend of mine in the business was selling t-shirts to Detroit Tigers. I said, gee, that's a very exciting idea, right? Yeah. And I was an accountant by trade, and I started talking to him about it, got involved with him, and met his screen printer, got involved, know what to do. Screen printer told me, why don't you start— I'll work together and we'll start this business on her own. It was called Crown Specialties at the time and grew from there with 3 salespeople. Then my son joined, one of my other sons joined the company, Todd, and it grew to a point where we got ourselves an investor, which is Todd's father-in-law. We moved from there to another location, and from there we grew. And the story is just adding people, good people, smart people. And I would say that you can see where we come from there to today. It's really been exciting. Yeah, a good journey.

Yeah, I'll bet. Brady, how many employees do you have now?

What look—

where are all your locations?

We have a total about 40 employees, about 23 sales staff and then support staff. Our main office headquartered in Northbrook, Illinois. And we have our second largest office in Solana Beach, California. And we have some satellite office in Tucson, Arizona, Austin, Texas, and Denver, Colorado.

Okay. Elliott, what are you most proud of as you look back on this incredible success? You just had your best year ever. From those humble beginnings, what are you most proud of as you look back over the history of your success?

I think it— by growth, not just sales. I think growth has been with people, the clients we can handle. I remember years ago, the clients we have today, we couldn't control it. We couldn't get them. They would go some other places.

They're more sophisticated, more high demand.

Yes. And needing better service. And we couldn't offer it at the time. Today, as you see with Corey and Brady and the people we have, it's not a problem. There's no fear about getting clients.

Let's talk about the type of clients that you have, Corey. What types of customers do you have and services are you providing for these customers?

Our clients range from Fortune 500 to mid to large size companies that have tens of thousands of employees. Some are publicly traded, some are private. Some have large sales forces that need maybe an online solution to maybe send out products to their clients or their prospects. So it runs the gamut. We like to try and get larger clients because they're easier to work with. They're harder to get, of course.

Yeah.

What about you? As you look back over the success of the business, what are a couple of things or something you're most proud of?

I think the stability of the company, the growth of the company, consistently growing the people, And then one of the biggest things is family. We've been doing this for so long together that— And it's always fun to talk about. There's ups and downs, but we're all— The baseline is that we all care about each other, love each other, and hope we want to all succeed.

Yeah. Yeah. And another point, I know we always like large clients, but part of our success is we handle a lot of clients and different clients and we donate things and we spend time with people. And that's real important in our business. Yeah.

I wanted to add I wrote some notes about some poignant times. I remember after 9/11, everyone's business was shocked, and my dad immediately thought of, "How can we make lemonades out of lemons?" And we started selling American flag lapel pins, and that promoted our sales tremendously. And then when the dot-com bubble burst, we had such a great diverse client base that kept us insulated from that, as well as when the pharmaceutical industry couldn't buy promotional items, we had such a diverse client base that we could lean on for other type of sales. In addition to just recently, the past recession, our diverse client base allows us to be resilient when other companies are failing.

Yeah.

That diversity of client base, just not the types of industries you sell to, obviously, does that also apply to diversity in the sense of No one client owns your company in the sense of their overall revenue?

Right.

Exactly.

I mean, if our largest client unfortunately left, we would still be a strong company.

Yeah.

Yeah.

What about headwinds? What do you think, guys, if you look back and see some of the biggest challenges? Maybe let's try and draw that into maybe the past 5 to 10 years or so. What were some of the biggest challenges you overcame?

Well, at one time, we had a moment where we were hiring and looking for salespeople. Yeah. That the millennium crowd, we went for college graduates hoping they would learn our business. We found out that there's too many obstacles. And the most successful people we have found are middle-aged, hard workers, have a strong value, a strong base. Normally our family members have families. And that was really a moment that we had to look back and see where are we going with this?

I think the challenge was not really understanding what motivated workers these days, if it was money or flexibility or whatnot, to really put the best team together that was all reaching for the same goal.

Yeah.

Let's talk about this family-owned business dynamic for a little bit. So Donald is— Don is not in the industry, but he's actually sitting here listening in on the podcast. And so we have Don, Corey, Brady. I have 3 brothers, and so we used to beat the shit out of each other, and I know what living with brothers is like, so I kind of know this could possibly be extended into the family dynamic. There are a lot of family-owned businesses in the industry. Can you tell us how in your company, how has that been beneficial? And let's talk a little bit about the challenges of a family-owned business. Elliot, do you want to start?

Yeah. I would not say there hasn't been challenges. It's a personality challenge. It's nothing to do about the love. Forget the love. The love is there all the time, no matter what they say or do. It does never change that. It's personalities. Corey is an engineer. Brady came from another direction. Todd came from a lot of this. And you have to mold, really, your family into wanting to go in the right direction. And when that happened, it's full speed ahead. But again, I'm not saying it was like, oh, everybody was— there were moments. And I hope they're past and they're on a positive direction now. Yeah, yeah.

Corey, what have you guys learned working together as a family? Have there been some secrets and sort of tips that you can pass on to other family businesses in terms of not just working together, but aligning vision, where the company is going, how to solve problems when there's challenges?

That's a great question. I think just the history of our family, we just got very lucky the way we grew up, very close-knit. I think the number one thing is that we don't have any grudges against each other, that there's no ill will towards anyone. And most of those things are like water under the bridge and we're friends, we're funny, we joke a lot. So Those are some things that are— But during work, there are definitely moments where we need to be focused on work. And sometimes that could be— But again, we intermix it with jokes at the end of the day. It's family first.

Strategy, in terms of strategy and where the business is going, you pretty much find alignment after all these years? Have there been times where you had to make some critical decisions in terms of where the business is going that that can be stressful? What did you learn through that?

Yeah, I think that as far as vision and alignment is based on what the industry needs are, it's pretty common sense. No one's out to drive one direction and say this is the way or no way because some of it's logical. This is where the industry's going and we need to get in that way in order to grow. And then we show that we prove that by growth or whether it's other people working for us, things like that.

Brady, any comments you want to add to that?

Well, I wanted to mention that I think what's best is we use our strengths. Where my dad is really motivating and loves new product selection and Corey maybe always uses the term, he's like, there's someone that makes the sausage and someone eats the sausage. And Corey is a little bit of our sausage maker, I guess you would say. So everyone's using their skillset all, like my dad said, all in the right direction.

Right. How did you define those roles? Did you just sort of understand and fit those? You had those passions?

If it was hard, Corey did it. Anything else we would just divvy up.

Yeah, and I would go on vacations, and that's it.

We encouraged my dad to travel as much as possible.

Is that the secret?

That's how the family—

that's how the family business works?

Yeah, yeah, that's the hot fudge on the, uh, ice cream.

That's great.

Just go away for a while.

I mean, me and my brothers would be arm wrestling over every decision, you know. Maybe, maybe we would—

that'd be a no-brainer.

I'm a loser.

What about succession plan? You know, you've got— what have you Elliot, are you semi-retired? Are you in the business every day?

What's that like? You cannot personally semi-retire from this industry.

No, you can't.

I would agree. I'm telling you, I went to accounting and accounting, but this industry to me personally, as long as my brain is working, there's so many ideas that come through. And we have made some major, not succession, but changes in the dynamic of the company. And I'm happy. I'm excited about it. The boys wanted it. And I hope they're happy with it. I am. I don't know as much as I know how to make the thing go. I know what I know. I'm old-fashioned, old school. I look at things and that's how I want to grow.

Well, somebody made the comment to me this week that nobody retires from this business. I think that's kind of an interesting comment. And I think it's true what you just said. Yeah.

I mean, I don't know how you can. I mean, it's just, you come here and every little item makes you— It's what's great about this industry, I think. Yeah.

Give us an idea, give us a better perspective. I mean, Blue Sky is a big company, and you guys, a lot of folks I know, when you showed up, Brady, to help on a panel that we did at a sales conference, there were folks in the room that showed up just because you guys were there, which I thought was interesting. That's how much of a mark you've made on the market. Corey, tell us a little bit about your business so we can get a better understanding. Do you focus on program business? Is it customization? What if you had to define your niche What would you say that is?

[Speaker:SHAWN_BENNETT] Yeah, I would say there's a couple things. I don't think it's like a secret. We see, probably have met with 90% of our clients literally in a conference room and met with them and presented to them products and solutions for them. So we're not doing all this online business. We're not driving traffic to our website so they could just buy something and work with some random person. And we understand that's out there and those people are doing very well, but that's just not the way that we would ever run our business. And we're not looking to franchise out and get all these people just so we can have a bunch of people here and trying to manage a bunch of people. That's not the way we'll do it. That's not the way we're ever going to do it. We just do it organically with people that we like, that are friendly, that are funny, that are intelligent. So that's kind of like our model of how we grow. So it's not explosive growth, but so that's one way. And then just getting more into online solutions and our clients are young, they're tech savvy, they expect things that are almost like Amazon. And we're trying to deliver that to them, that experience. And I mean, hats off to Common Skew because you guys are reaching that demographic. And that's why, I mean, I know I'm plugging this, but the truth is that we were going to go with Common Skew 6 or 7 years ago when we met with Catherine and we just weren't ready for it. But it's always been in the back of our head. And as you probably know, we're full steam ahead this year.

Yeah. Since we're on that subject, and typically, so you guys know, on the podcast, we don't really talk about Common Commonsku. Every now and then we may, but on this topic, what led you— why don't we start with Brady and then we'll go back to you, Corey, unless I've got roles reversed here and you guys are happy to switch. But what led you to consider Commonsku and what has that transformation been like?

I think structure was something that we were just all craving for and having a process that everybody followed that we could collaborate together. Help each other with, have a uniformity of our brand and our messaging, and just to have better time management. I mean, just put it all together where no more excuses. And Commscue has helped so much in so many facets of my personal business, and it's really exciting to fold it through everyone in the company now.

Yeah.

Corey, one of the things that folks are really concerned about, I know when I was running a distributorship, there was so much complexity for our business. We had fulfillment, pick, pack, and ship, and ecommerce and pulling trigger on an ERP solution for your business is no small decision. On the other side of this, now that you've been on board, was that an easier process than you expected?

We're going through it literally right now because we started it at the beginning of the year for accounting reasons, just to be in line with. So the transition from on the accounting side is a little bit more difficult because things overlap, but the process as far as putting an order in and sending an order, it just It's different, but everyone's done it thousands of times. So it's just a different way of doing it. We've been using it for a long time just in the front end for presentations and estimates, but we now have completely converted to sending orders through and doing invoicing and billing and so on and so forth.

A question, I'm going to leap back to another topic and maybe we can splice into that topic with this. What led to this exponential growth last year, do you think? Was this anything specific that you guys had done? I'm curious about that.

I think it was actually 2 years ago when we had several people, top people leave our company and start a competitive business against ours. And while at the time it was painful personally and financially for the company, it opened up space for us to actually do what we need to do.

What do you mean do what you need to do?

Move in a direction where we weren't waiting on someone else to make the decisions that were not in line with maybe what should have been done. I got you. They were focused probably on their own vision and starting their own company rather than building Blue Sky at that time. So in fact, we know that that would be the case. So once this was gone, we realized that we could— we banded together. So we definitely got closer and worked longer to fill the gaps, recoup some of the people that we had lost, some clients, and then rebuilt and became just more efficient and focused on the bigger clients. And started doing more SPACs, more virtuals, more— we got a lot of support from our vendors. And then tying this in with software and offering online solutions to our clients, that's what's kind of locked them. And our clients grew. Thankfully, our clients just also got bigger.

That's an interesting part of your journey that happened, how that rallied everyone around this passionate vision toward what the brand is. And it's one of the benefits of Common Scuse, we were just talking about that a minute ago, is building equity in your own company and actually in the brand, as opposed to having these sales rep driven business model that can walk away with your business. Folks instead are buying from blue sky, right?

And that's something we— that's something that we transition to as well.

Yeah. Brady, you want to comment on any of that? I want— I don't want to leave you hanging on it.

So, okay, I would be remiss to say, when you meant how we started a little bit, my dad always said, you know, you can't retire off one order.

Yeah.

Which always meant you just got to grind and grind and take them all in. And when we go into a sales call, I say, "Listen, anybody can be a penny cheaper, but reliability, service, and all the added values we bring to the table really sets us apart." Yeah.

And another thing we've added, I think, and really a positive is account managers.

Yeah.

It's something new in our world for us that we do it ourselves, but these account managers—

Give me an idea what the account manager does.

Makes— frees up our top salespeople and everybody to to do what they do best.

Okay.

Seeing the client, seeing a client, talking. And my, mine— and I'm not the top salesperson by any means, but my assistant, she's amazing. Yeah. It gives me an opportunity to think about the ideas. I'm here, but— and she's already taking care of all of my clients. Yeah. And all that. I would say it for everybody. And that's a real important factor in our company in the last couple years.

That's a very insightful comment and interesting what you guys did, because we typically landlock our sales reps in this business where they're— they come into the business and they have to go out and get the business, and then they develop the business, suddenly have a book of business, and all those skills— they, they— the skill that they developed and the muscle they developed to go land new business, they sort of, they get muscle atrophy because now they're working on a different skill set, which is managing accounts. And so it sounds like you built this managing accounts portion so that salespeople could go be freed up to go call on business and, and get new business and be proactive.

Yeah, that's what we— we invested in it because, yeah, you know, these are people that—

that's a big investment.

It's a big investment.

It is.

And it's something that in the back in the day, that's something we wouldn't have done. We just had a commission-based salesperson and, yeah, and gone that route.

But that's great, Brady. How— this is a big deal because I think there's other distributors listening to this, and one of the weakest areas in building a business, successful business in this industry, is that new business component. How do you go out and get that instead of hamstringing yourself? When did this take place and how long have you now had this account manager layer?

We've had account managers for high-earning salespeople for about 7, 8 years now, but we are going to try to grow that aspect of our business to really build some blue sky house accounts that our account managers could build on.

Are these folks salary plus bonus? Salary plus commission?

Yes.

Yeah, that's great. So when we had company stores, that's one of the things we had to do too. We wanted more house accounts, we wanted to build equity in the, the brand itself, and then we went to move to a more salary-plus situation. Since we're here at the end of a decade and we're looking forward— Mark and I just interviewed Paul Bellantone and Tim Andrews right before you guys came in on a look back over the past 10 years, and I didn't have this in our list of questions, so I'm going to ask it this way. As we look back on the past decade and we're looking forward to another decade, what do you guys think have been the biggest changes that have had a positive impact on your business over the past 10 years? Has that been a change in how people perceive the product itself? Has that been the way we've organized our infrastructure? Corey, go ahead.

I'll talk to on the logistics side. I think a lot of our vendors are— you don't miss deadlines anymore. One, because you have obviously FedEx and UPS can do overnight. And back in the day, that was something it couldn't be done. But our vendors are doing 1-day turns, 3-day turns, 5-day turns at no additional charge. They're also doing full-color imprints. So direct-to-garment or digital printing allows for very quick turnarounds and 1-piece minimums. So things like that have made it very easy for us to not have to worry about missing a deadline or doing something incorrectly or whatever it might be. So that was very helpful over the last 10 years.

Go ahead, Elliot.

Quality and variety of product that we now can offer our clients.

Right.

When I first started the business, I remember CrossPen, for example, wouldn't sell us. Only 3 distributors in the state of Illinois would. Today, there's nobody who will not sell us.

Right.

And you go either apparel business out there now, we are better than retail. Yeah, we are stronger than retail. Yeah. So there is no fear anymore in the future of what we can go after.

Yeah, I agree with you. To the point of speed, someone mentioned to me that Amazon has actually done us a favor, even though it's very difficult that customers now expect it tomorrow. That's also presented a very profitable opportunity for us as well. And I love your comment, Elliot. I too have seen the sophistication of the industry, not only the sophistication of the client and what they expect of us. We're doing more complex projects than before. We're doing more creative projects than ever before. And the product itself, respectability of branded merchandise has risen over the past decade. There's so much there. Looking forward, what do you guys think are going to be the biggest challenges in the next decade as we face looking ahead?

The buyer has changed in our industry. I think the consumer is going to ultimately change. I'm not quite sure what floats their boat really is going to be. Really what's going to be— is it tech? Is it sustainability? Is it lifestyle? What is that next new category?

I think from an industry standpoint, I think there's a lot of consolidation right now and a lot of big, big companies are buying other companies. And my biggest fear is that they're getting too big where they're going to lose that customer service aspect or just lose how they used to do things, or our reps are going to change and the people that we liked and did really well are now maybe managing a lot more than they used to, different larger product lines. So I'm just concerned about this, a lot of these companies merging together and then losing some of this customer service that we've enjoyed for so long.

I've heard that voiced a lot. That's a big concern for folks.

I just think we should never be complacent. I'm concerned about outside forces other than our customers that can create problem in any industry. Yeah. So I think we should always grow. I mean, the assumption to go out and get new clients, new businesses, diversify the most you can, as best as you can. I just worry about the economy in general. We don't have to be a part of it. We could be part of a problem that we didn't even create.

For 2020, are you optimistic, Elliott?

Oh, God, yes. Absolutely. I mean, I just can't— our salespeople, today at breakfast, there's humming, there's talking, there's excitement. It's unbelievable. Never had that much talking about positive things and progress. Projects and people. I mean, it's unbelievable. And then you go— then you get your emails from your account executives handling everything about it. I mean, it's just— it's really great. I mean, really, seriously, it's a very strong future for us.

It sounds like you guys are being very respectful of maybe the challenges and the personalities involved in some of the challenges you've had, but it sounds like you've had some bigger setbacks than you really want to discuss publicly, and that resiliency has been a big part of your transformation.

Yeah, I'm really proud to be at a better point today than we were yesterday, so to speak, based on our resilience of survival and the great work ethic that our dad has instilled in us to keep growing, keep grinding, Don't be satisfied. And, and we were brought down to our knees a little bit on some personal and professional setbacks, but it makes us stronger and has made us stronger. And like I said, put us in a really positive point today.

Yeah. Corey, was that experience in a sense then a wake-up call, and it really just was a call to action for everybody in, in the business? Did you find more alignment through that?

I, you know, I, it, I, absolutely. Yeah, we all came together, and I actually became president, so I actually took a more of a role, less of sales and more of operations and help the direction of where we were going and spent more time on that. Well, probably equal amount of time on that than with the clients. So yeah, that was definitely a turning point. And honestly, it was the best thing that ever happened to us.

Elliot, let's let you have the last word. You're sitting with a young distributor who just got into the business over coffee, and there you have a few brief moments and they've asked you for 10, 15 minutes of your time and they say, "What do you think the secret of success is in this business?" Wow.

Everybody can say hard work and everybody can say things. I think honesty. Your client or whoever you're working with, you have to look in their eyes. What are they looking for? What do they want? And if you keep doing that from one year to one day, you'll find out that the client client will be not only money for you, but also a friend, someone who you can trust, and they will make you grow in the company. I just think you should never stop asking questions, never stop asking why, and always learn more. This industry is made for you. This industry is for young people. We need young people. I've seen a lot of the people in this industry have disappeared and gone, and companies, but But if you're young in this industry, there is no excuse for success.

What I love about your reply is I was just visiting with the president of one of the largest companies in the industry today. So president of a billion-dollar company. And we were discussing today the heart of success in this business, and that is getting closer to the customer, understanding them incredibly well, and understanding their why. And your voice of experience validates, of course, all of that. So I agree 100%. It's an excellent answer. Thanks for wrapping this up. You guys, thank you for joining me.

Blue Sky thanks you.

Thanks so much for tuning in to this episode of SKU Cast. Be sure to keep up with our latest content by subscribing to SKU Cast on iTunes or to our blog at community.commsku.com. Until next time, friends, thanks so much for listening.