St. Louis Post-Dispatch from St. Louis, Missouri • Page 126

BP10 http:www.stlnet.com ST. LOUIS POST-DISPATCH ENTERPRISE fin A 5 Samuel Fromartz Starting A Business Build a great team to sell your gizmo Reuters News Service Pair already planting seeds for spnng sales New varieties of flowers a specialty grwig i-' 1 V' -f iVv i K'; L--, -r LI .1 .7. "4V By Jerri Stroud Of the Post-Dispatch Thousands of brilliant red poinsettias blaze throughout Haefner's Greenhouses this time of year. Over the next 3'A weeks, Haefner's will ship approximately 35,000 poinsettias to grocers, floral shops and other customers throughout the St. Louis area.

In addition to red, they sell pink, white and variegated poinsettias, Christmas cactuses and ornamental peppers. As soon as the poinsettias are gone, Haefner's 25 employees will start transplanting 75,000 perennials. They're already sowing seeds for flowers to go in more than 100,000 four-inch pots, not to mention thousands of flats, hanging baskets and other containers for spring and running CyberCash, an Internet payments company, made this point in a conference this past June. He called it the 90 degrees rule. "Every single company that I've been involved in ends up being rather different than what we started out to be," he said.

He likened this to the bee that seeks out pollen and ends up creating a lot of honey in the process a side business. "If you start out for anything," he said, "you are not going to get it. You are going to end up getting something else 90 degrees off to the side." The point is to be able to recognize the strengths of what might initially be a side business or to have the people aboard who can. Invest in people The importance of the people behind the enterprise brings another case to mind. The New York Times in September had an article on the founders of Nantucket Nectars, a successful juice company in a competitive market.

Tom First and Tom Scott started by doing odd jobs and deliveries to yachts off Nantucket island in Massachusetts. Then they came up with a juice beverage that proved a hit. Beset by the typical cash flow problems of a start-up, they approached one of their customers, Michael Egan, who had made a fortune on the sale of his Alamo car rental company. Egan told the Times that most people don't have a prayer to keep a business going, "but these guys were just personally attractive, very hard working, dedicated, visionary and so on." Even though he thought the juice wasn't too good some of the flavors were "horrible," he said he agreed to give them $500,000 for half of the business. He was betting on the team.

Now Nantucket Nectars is a $60 million business. To build a team, you need to recognize your weaknesses and get other people employees, partners, investors, mentors, advisers, accountants, lawyers, suppliers and customers to get on board and give you the advice you need. The key is building strong relationships, because they can help you make the crucial business decisions you need to keep the business going. Without a team, you're dead in the water. With one, at least you have a fighting chance.

spiring entrepreneurs often think it takes a Jrttgreat product or service to make a company, that a great gizmo will attract customers in droves. But if you talk to people who have built successful companies, they say the product is the least important thing. What's most important? "The people, the make-up of the team and the way they interact: That is 90 percent of the equation," said Tony Carter, a veteran entrepreneur who provides seed funding to start-ups through his International Business Group. "The market niche is the second most important thing and the final thing I look at is the product," he said. Stanley Pratt, a venture capitalist at Boston's Abbott Capital, made a similar point at a re-cent Small Business Administration conference in Washington.

"In real estate there are three keys to success: location, location, location," he said. "In business management, there are five key areas: management, management, management, market niche and finally product or service." Pratt said too many entrepreneurs fall in love with the product or service they are offering. That prevents them from scrapping it to save the company if the product doesn't work out. Bet on a great team The quality of the team is so important that venture capitalists say they would rather bet on a great team with a poor product than a poor team with a great product. What counts, they point out, is execution, not the concept itself.

The team is crucial because few products get out the door the way they are originally conceived. It takes a strong team, however, to be able to shift emphasis, jettison old ideas, consider new markets and remake the product. Bill Melton, who has built a few companies and who is now 'A i'" i ir. t. summer flowers.

The greenhouse business is a year-round venture for Greg and Marsha Haefner, although their retail shop is open for only three short seasons April to June, September and October plus the month between Thanksgiving and Christmas. The poinsettias they're selling now were planted in April. In the fall, Haefner's sells about 80,000 mums. No winter vacation The business still is seasonal. About 75 percent of their $1 million in sales comes from the six-week spring planting season.

Rainy weekends can shut off orders like a spigot. On sunny days, customers all want deliveries at once. The Haefners say their customers sometimes ask them what they do in the winter. "They think Greg and I go to Florida," Marsha Haefner laughs. But the couple seldom travels far from Oakville and the 30-acre farm where Greg Haefner grew up.

By Feb. 1, they'll be running two shifts of workers to transplant bedding plants, perennials and hanging baskets for the spring planting season. They've already begun potting geranium cuttings shipped from Guatemala. Most of the plants are grown from seed in Haefner's 33 greenhouses, which cover about an acre and a half of land at 6777 Telegraph Road. The family also grows perennials like hostas in fields behind the greenhouses.

The business of plants Haefner's is among a handful of local greenhouses that raises plants for retail garden centers, grocers and others in the St. Louis area. The growers are fierce competitors in business, but they're good friends otherwise. The Haefners often va- Greg and Marsha Haefner expect to sell 35,000 poinsettias this holiday season. But spring flower seedlings and transplanting 75,000 perennials.

ily. His grandparents grew vegetables where he grows flowers. His mother raised vegetables and sold them from a plot now occupied by Dierbergs' Telegraph Road store, about a quarter of a mile farther north. Haefner was going to be a mechanical engineer when he went to the University of cation with the Fahr family, which has a greenhouse business in Glencoe. Nationwide, floriculture the cultivation of flowers is a $3.4 billion business.

Five states account for more than half of the nation's production, but there are growers in almost every state serving local markets. About 70 percent of Haefner's business is wholesale. The retail shop concentrates on selling plants from the greenhouses. At Christmas, the shop sells Christmas trees and garlands along with the poinsettias. "I try hard not to get side-tracked with sod and shrubs," says Marsha Haefner, who runs the retail shop.

"We really focus on keeping it simple." Off the farm Greg Haefner grew up in a farming fam Missouri around 1970. (The Haetners met there. He played several instruments and was in the Marching Mizzou band. She was a baton-twirling Golden Girl.) Halfway through school, Haefner decided to switch to horticulture. He didn't have time to get all the required courses, so he ended up with a degree in agricultural engineering.

To avoid getting drafted and sent to Vietnam, he had joined the Naval Reserve Officers Training Corps (NROTC). He went straight into the Navy.