Monday, June 27, 2011

Thirty Years Of Jobbers - Chapter 1.14

By November of 1983, many companies had been cheated by unscrupulous computer vendors and computer sales started to suffer because of it. While calling on prospective buyers, two said they would buy my system, but only if I could guarantee it would work. Imagine that! They expected me to buy a computer using my money, install it in their office, stay for a full month, put their business on it, train their staff, and if they like it, then and only then would they pay me for my work... absurd.

Well, that's exactly what I did. In fact, it worked out so well the next forty systems were sold in exactly the same manner. It’s a policy I maintain in my company to this day. You don’t like it, you don’t have to pay for it. By the end of 1985, my annual sales topped $500,000… an amazing accomplishment for a tiny company such as mine.

However, in 1986, the bottom fell out of the computer business. It coincided with the time Congress rewrote the tax code and eliminated many of the loopholes that allowed businesses to write off a great deal of unnecessary activities they had been allowed to use as deductions in the past.

Many overstaffed, highly-leveraged competitors started dropping like flies. In September 1986, I took my wife and eight year-old daughter to ‘Disney World’, and it was while I was there an Alabama competitor who had characterized my company as a ‘Mickey Mouse operation’ filed Chapter 7 and went out of business. I was delighted, and while I was in the jewelry store on Main Street at the amusement park I purchased an 18-carat gold ‘Mickey Mouse’ pin I continue to wear to this day.

I survived, but barely. My famous "Try It Before You Buy It" campaign was getting harder to sell.  Jobbers had entered an era of cutting cost and pinching pennies. At that time, most of my customers were still doing okay, but the jobbers I tried to sell to.... they were running scared. I needed a new plan.

IBM minicomputers computers were still over $40,000 and jobbers were buying the cheapest computers they could find. I refused to sell PCs, but if they had one and they would send it to me, I agreed to put my software on it.  I was amazed at the junk I received in the mail. When I opened the box of one computer, all the parts had fallen out of their slots and were rattling around in the case.

I sold my software for only $5,995 with no on-site installation. I sold thirteen the first month, but I had no idea what I was getting into. By 1989, 360 oil marketers were using my back office and convenience store software… 80 of them were PCs.

When PC customers started sending back copies of their general ledgers and accounts receivable files with huge chunks of data missing right out of the middle of them, I realized what a mistake I had made. A few PC customers lived with screwdrivers in their pockets and actually liked them, but I simply refused to provide any new programs for PCs and I still don’t. It took eight years to get all of those personal computer customers converted over to IBM minicomputers.

In 1990, I redesigned my computer programs to run on the new IBM AS/400. As far as I’m concerned, the AS/400 is the most remarkable computer that was ever invented; but this book is not about computers. This book is about jobbers, and what I have learned over the past three decades of working with time.

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