A friend sent me a link to an article about Hanky Panky which has been manufacturing in the United States -in NY City no less- since 1977. By all accounts, they’re not likely to change that. Read the article, an interview with the CEO, for the reasons for their success. Here’s the cheat sheet; tell me if it reminds you of anything:
1. Slow patient growth. They started with one seamstress, cutting and sewing to order.
2. Being well-rounded with a range of experiences. The designer had previous industry experience and the other partner’s background is in social psychology.
3. Being privately held. The firm is owned by the original two partners. Not having investors meant autonomy to define their own course instead of worrying about making next quarter’s profit targets.
4. They didn’t borrow money. They used sales to drive growth, plowing the money back in.
5. They kept their egos firmly in check. No prima donnas here, they didn’t shoot for being the next rock star.
6. Publicity was organic, driven by the product’s integrity. They’ve never paid for a celebrity endorsement.
7. They manufactured domestically in NY city. They save money and time on shipping which lowers their carbon footprint.
8. Being domestic allows fast turn around on trends.
9. They cut small lots.
10. Value: their products aren’t commodities but they’re not bridge or designer either.
11. Effective partnerships. They’ve been working with the same suppliers and contractors for 25+ years in mutually nurturing relationships.
12. A core value of environmentalism and sustainability before it became a trend.
13. Enduring tough times: their strategy relies on providing value -not discounts- continuous improvement and innovating with new product launches.
14. Retail partnerships: they wanted an ecommerce site but it took awhile to figure out how they could do it without competing with the retailers who made their success possible.
15. Protecting the brand by rigorously maintaining their reputation on all fronts. This meant not cheapening the product with discounting and being careful who they sold to. They focused on internal conditions over which they have control.
16. Keeping their employees happy. The company pays 100% of health insurance premiums.
17. Profitability, not growth or company size, has been the guiding force behind their decision making.
18. Accountability, always knowing what’s going on. The CEO opens all the mail.
Note the things that were not mentioned as the underpinnings to their success:
- Offshore sourcing to get the lowest cost per unit price.
- Not cutting large quantities to get a lower per unit cost.
- Hiring someone else to do all the heavy lifting.
- A focus on intellectual property, patents, trademarks, NDAs et cetera.
- Huge marketing and PR budgets to maintain their image.
- Having a cute logo slapped on everything.
- Getting investors and taking out loans.
- “Leveraging” (arm-twisting) those with whom they work in synergy.
- Fast growth with ambitious goals. Success kills small companies faster than no growth.
In short, does the profile of Hanky Panky’s success remind you of anything? Yeah, it’s the nuts and bolts of my book. Good thing this interview is recent, otherwise I could be accused of using the material without citing my sources. It takes adherence to core values to guide your course. The rules aren’t sexy, they aren’t flashy but you know what, 30 years from now you’ll be an icon. A profitable one. I close with this quote:
We keep the product developed and manufactured where we can see it and where we can make sure that not only are the proper production qualities being followed, but also that the manufacturing facilities are following all the rules and regulations required by the United States. It certainly reduces our carbon footprint because we’re not shipping goods, either raw materials or finished goods, from here to there.
Our goods don’t need a passport to get into this country. Manufacturing in New York also gives us more opportunity to develop special programs and products based on trends because the turn around time is much shorter than if we were to manufacture overseas. We can also run smaller lots here, so we’re able to work closely with our stores and develop special programs on-trend. Also, it’s good for the economy. And as an American company, it is important to do what we can to create a healthier economy for our business to exist in.
Success isn’t a vicarious accident. My book will show you how to build the core of a thriving happy company where ever you live with these 18 secrets.