Entrepreneurship in the Promotional Products Industry

Larry Cohen and Mitch Mounger both agree: The ad specialty industry is a breeding ground for true entrepreneurs.

When you think of true entrepreneurs in the industry, you can start with Mitch Mounger and Larry Cohen. Technically competitors, certainly collaborators (in the PeerNet distributor group) and most certainly colleagues and friends, the pair agree the industry is a tremendous breeding ground for true entrepreneurs.

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Counselor: How long have your companies been in the industry?
Larry Cohen: Twenty-five years next year – our silver anniversary.
Mitch Mounger: Twenty-one years next year.

Counselor: So through the lens of that experience, if you were starting a distributorship today, what would you do differently?
MM: I wouldn’t do anything differently, and the reason for that is the early struggle that Sunrise went through helped define who we are today. I don’t think you can get taught that stuff in school. I feel like we got our MBA the hard way. And that helped define our culture and who we are. Now clearly the market has changed, and we probably would have had more of an online presence than we originally did, and more of an omni-channel approach to the business. But if I were starting today, I’d probably go about it much of the same way.

Counselor: Can you share one mistake you made that you really learned from?
MM: I tried to be all things to all people. We didn’t say no enough. We were looking for business every possible way we could and sometimes we got out over our skis.
LC: One thing I think would be vastly different is the nature of the way the industry was built around commission sales. That has evolved into people becoming employees with benefits and all the other stuff. And then you tie in the additional cost that Mitch and I deal with on a regular basis, like the cost of technology, which is massive. Today, companies have to be prepared to spend a lot of money on their technology, and I think why we’re seeing some companies getting squeezed is because that traditional model has become more difficult to deal with due to all the additional costs.

Counselor: Are clients asking for new and different things, or expecting more from you? Do they treat you as their ad agency, their creative arm?
MM: That’s the place where we want to get. We’re trying to position ourselves as a true partner – not as somebody they can order products from. That’s our goal when we can get them to invite us to the table, when it’s not about the product; it’s about the experience, how it’s delivered, the total cost of ownership when we’re solving a problem – that’s when we know when we’ve made a true partner.
LC: If we’re only about the product and price, somebody’s going to eat our lunch. But I don’t feel compelled to become the agency clients come to that say we want you to design all of our logos and you’re going to be our agency of record. In that world now, where a lot of ad buying is being done electronically, they’re getting crushed because they used to bill by time, which they can’t make money from anymore because everything can be done so much more quickly and easily. So I’m not rushing to become what they’re struggling to get out of. We actually had a call recently from a client who wants a call every Wednesday at 3 p.m. to assess a project and we said absolutely not. I don’t get paid by the hour.

Counselor: What advice would you give a young distributor entrepreneur today?
LC: Find a great mentor on the distributor and supplier side. I would say without a doubt that I would attribute a great deal of our success to the value I got from being able to be around people like Mitch and PeerNet, where I was able to ask questions before I made some big mistakes – that helped us to be a lot smarter about what we’re doing. I think our industry seems completely weird to people outside it, people in our industry are really friendly and willing to help each other out in ways competitors in other industries aren’t. Suppliers and distributors do it all the time. I was at a meeting and SanMar, Trimark and alpha were all there and they were all pretty open. That’s an amazing thing, you know?
MM: Let me just second Larry’s comment. Did Sunrise’s sales double because we joined PeerNet? No, we probably would have doubled anyway – but the road would have been a lot rockier without being able to call Larry or any of these guys that have dealt with some similar issues in the past. It was amazingly helpful to have that knowledge share. That’s a great piece of advice. The other thing I’d say is work on your value proposition. Figure out what value you’re bringing. You don’t want to sell on price alone ‘cause you’ll get beat. Add value to your customer and you’ll be successful.