Entrepreneur Cases: Russell Cox
Creating Art Source
Russell Cox dates his entrepreneurial beginnings to when he was 14 years old, and he started a greenhouse business. When he was 17 years old, his parents bought a retail picture frame shop. They had operated a trophy shop in their home, but knew nothing about framing. Russell had an eye for beauty and a gift for working with his hands, however, and he taught himself the business.
Five years later, he was ready to go into business for himself. He had been a B student at Trinity High School in Euless, Texas. He chose a distributive education (now called marketing education) program at A & M Consolidated, College Station, Texas.
"I think I learned the most from my DE classes when we had open discussion about our jobs." Russell says. "I was self-employed, but I learned a lot from fellow students on what not to do as a business owner."
A self-described natural organizer, Russell held offices in high school and vocational school that taught him how to negotiate and compromise. He was president of Distributive Education Clubs of America (DECA), captain of the gymnastics team, and a candidate for the DECA area presidency.
From these early experiences, Russell learned an important fact about himself. "A traditional job would not provide me with the independence and financial opportunities that I seek," he says. And he had observed that other members of his family enjoyed a higher standard of living through owning their own businesses.
The frame shop gave him the idea for his own business. "I moved ans started a wholesale version of the same business. In order to reach my goals, I knew that I must serve the larger corporate market. Wholesale can serve a larger market from one location than a retail store," he explained.
From Entrepreneur magazine, he learned creative financing methods and how to draw up a business plan. His accountant helped him prepare a budget. According to industry surveys, there was corporate demand for his type of business. For financing, Russell used personal savings, bank financing, and lease-purchase agreements.
He works out of a warehouse with one small office. This arrangement not only keeps down overhead, allowing Russell to price his product competitively and offer volume discounts, but also appeals to his customers. "Clients seem to like coming out to the warehouse to see other works in progress," he says.
He stresses the creative side of his business. "When you supply retailers," Russell points out, "you must create new designs constantly. I have to produce a number of different designs so that each retailer will have something slightly different than the competition."
"Buying right is another big part of my business. In order to stay competitive, I must bypass distributors and seek out the manufacturers," he says.
Besides himself, six people work in Russell Gallery. In the past three months, sales were $27,000. Russell put all the profits back into the business. Russell is very precise about his plans for growth. He wants to gross $200,000 by the end of this year, and $1 million by the end of 1991. He will expand "horizontally" into frame molding manufacture, art publishing, and retail sales. He plans to make Russell Gallery into a broad-based wholesale/retail art and framing company.
Being in business for himself has caused Russell to sacrifice material possessions now for future rewards. He knows he works longer and harder than his friends. Some of his hurdles are psychological...like "being patient and optimistic when there is little motivation to do so".
But Russell does not give up. An important failure can deal him a temporary setback, but he bounces back. "I usually feel down for a day or two before I get my attitude straightened out and come back even stronger," he says.
QUESTIONS FOR DISCUSSION
- What did Russell Cox learn from his early work experience and his family's circumstances?
- What natural aptitudes and abilities did Russell bring to his parents' framing business?
- How did the family framing business influence Russell's choice of his own business?
- Besides high school and vocational school, where did Russell learn the facts and skills that helped him in the business?
- What advantages does the warehouse operation have over a retail store?