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Business Planning Basics
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Calculators for Entrepreneurs
January 14, 2008
Going off to college can be a moving experience. For Josh Kowitt and Scott Neuberger, it became a business. Every fall, students move into dorm rooms and apartments, hauling boxes and furniture and other belongings. When the school year ends, they move everything out. Wouldn't it be great to have a service that would move you in and out, and also store your stuff between semesters?
Neuberger thought so. He saw all the moving that was happening on college campuses as an opportunity to jump-start his career with this business idea during his freshman year at Washington University in St. Louis. Meanwhile, Kowitt, also a freshman on the same campus, started his own enterprise, renting mini-refrigerators to students.
Their employees frequently passed each other while making deliveries in the dorms and reported back to their young bosses. The two freshmen saw that they shared a desire to make college life a little easier for students, so they merged the two successful operations. University Trucking provides shipping services for college students around the country. The company contracts with moving companies and leverages a volume rate to make it more affordable to service a location.
Neuberger describes his business as "middlemen" between the moving companies and the students. "One moving company can't profitably serve one customer or one college," he says, "and the college customer can't afford the moving services of a moving company to just move their own stuff. However, if we market to a whole college and get 50 or 100 to sign up for the service-on our biggest campuses, we have over 1,000 customers-we can offer a good price to students that includes pick up, storage, and delivery back to the room later, as well as offering a profitable business for the moving company. We provide marketing, customer service, and an overall operations role in terms of coordinating pickups and deliveries."
Kowitt and Neuberger made an agreement with the administration at Washington University that the business would always remain student-run. So, after graduation in 2004, they sold the business to a couple of classmates and moved on.
Boxes and Business
But Neuberger still recognized the need to help students move in and out of dorms and have a place to store their belongings during the summer break. He also knew the service had to be affordable. He headed to Boston and used his college business experience to launch Campus Evolutions, a student solutions company. Funded by family, friends, and angel investors, the business grew rapidly. In less than a year, he bought out his competition, Collegeboxes, Inc. Seeing the possibilities, he put in a call to his former business partner and invited Kowitt to help him revive their success in the world of campus storage and shipping. "It wasn't a tough sell to dive back in," says Kowitt.
Washington University gave them a good start, but the two entrepreneurs have learned that you can't sit back on past successes. "Things also changed a great deal over the last seven years. What worked then would be laughed at today," Neuberger explains. For example, they realized that having set times on campus for customers to pick up packing supplies was difficult for busy students. It also meant they had to lug their supplies around campus to get back to their dorms. As a result, they instituted a new program where students could order a packing and moving kit and have it shipped directly to their dorms.
Making Procrastination Pay
"Gen Y is so last-minute on everything," he continues. "By paying attention to their pace, we learned that we have to go where they are, not vice versa, and deliver what they need as fast as possible. We have to constantly focus on the needs of our customers because expectations keep rising. Our business comes under scrutiny every fall. That's part of the test." Neuberger adds that their operation is quite complaint-driven, so they always focus on maximizing their service. By paying attention to fixing what's wrong, they discover new ways to succeed. "Every year, we're pushed to perform better and provide even greater service. As a business grows, it's going to come under fire. The losers won't fix it and go out of business. The winners will fix it and persevere."
Kowitt and Neuberger are also grooming future entrepreneurs. Every campus they reach has a student who runs the operation there. They recognize that the business relies on the efforts of each student manager. To keep building a strong organization and increase their exposure, Collegeboxes provides the training and support to help these students launch, build, and maintain a lucrative operation while still in school.
"We try to set them up as mini-entrepreneurs where almost all their compensation is tied to the revenues that are generated on that campus," says Neuberger. "In addition, they're given a lot of freedom to produce and execute the marketing campaign based on their ideas."
Their business is on the move. Collegeboxes is now on 48 college campuses around the country, the largest operation of its kind, and posting $2 million in annual revenues. Besides profits, Kowitt and Neuberger are also making news. The pair was included on the Inc. Magazine list of "30 Under 30: America's Coolest Young Entrepreneurs." They've also been featured in USA Today, entrepreneur.com, Wall Street Journal, and Fortune Small Business.
Neuberger likes to refer to their corporate life as "a marathon, not a sprint," And he offers this same advice to his workers who are hauling boxes. "When you've got a big job ahead of you, you pace yourself. Don't try to do it too fast or you'll burn yourself out."
5 Tips for Business Success
En route to the team's success, Scott Neuberger and Josh Kowitt have gathered up some valuable lessons.
1. Write a business plan. "It's really important to build a written plan," Kowitt explains. "We found through the process of writing and editing a plan, our ideas for Collegeboxes have become much better."
2. Invest in your infrastructure. "I believe that Collegeboxes has been successful because we put our marketing efforts into areas that provide better service to our existing customers. We have also made sure to not invest money marketing to more customers when our business was not ready for the increase in demand," says Kowitt.
3. Listen to your customers. Neuberger says they use any complaints to improve their service delivery. "When customers are calling, we listen because they don't call when we're doing something right!"
4. Exceed expectations. Because they serve a youthful population, Collegeboxes undergoes greater scrutiny than those who focus on older, less techno-driven segments. With viral communication, word spreads immediately. "If three out of 500 students get mad, then the whole world knows about it," says Neuberger. "We've learned how to address our customer complaints with a calm, professional approach, and we leverage those complaints as an opportunity for growth."
5. Be decisive. "Big decisions hit you every day, and you have to be able to make those decisions with confidence," explains Neuberger. "In the past few years, we have learned that the best approach to decisions is to make them quickly and move on. Agonizing over decisions slows us down." Kowitt adds, "Making decisions has been better for us than sitting by idly Worst case scenario, if we screw up, we just go back and do it again."
For more information about Collegeboxes, please visit their website: www.Collegeboxes.com.
About the Author: Bea Fields is the owner and president of Five Star Leader Coaching and Training, which provides services to more than 500 companies worldwide. A well-known speaker and author, she has published more than 75 articles in addition to her first book, Millennial Leaders: Success Stories from Today's Most Brilliant Generation Y Leaders. Her next book, Edge! A Leadership Story, is scheduled for May 2008 release (Writers of The Round Table Press).



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