In this final installation from sponsor Junxion Strategy, we hear from business mogul Carole Browe Segal who co-founded her business fresh our of college, growing it into the Crate and Barrel we know today – as well as growing her social conscience.
Carole is joining the 19th annual SVI as a True Confessions speaker where she will speak about her fifty years in business.
This article by Hilary Mandel originally appeared on Junxion Strategy’s website on September 8, 2014.
SVI 2014 Profile | Carole Browe Segal, Crate and Barrel
Carole Browe Segal started her first business, a housewares store in Chicago, with her husband Gordon when they were both 22 years old, just a couple of years after their graduation from Northwestern University in Evanston, Illinois.
“We knew there were other young people like us who had more taste than money,” says Segal, reflecting back over 50 years to the early days of Crate and Barrel, “and we wanted to sell products that would last and that were also functional.” The Segals’ basic philosophy of selling well-designed products at a reasonable price remains a tenet of the company to this day. “It gives us great joy when we hear people still have things they bought from us years ago,” she says, reassuring words to hear in today’s throwaway culture.
Segal will be one of the True Confessions speakers at the upcoming Social Venture Institute, taking place September 10-14, 2014 at Hollyhock on Cortes Island, British Columbia. As someone who saw her family’s company grow from a humble brick and mortar store into a global retail enterprise with 120 locations, and more than $1 billion in annual sales (a significant amount of which is now earned online), Segal will have myriad stories to share with the entrepreneurs who’ll be attending SVI.
Make the world a better place
Segal has always had the philosophy of “making the world a better place for having been here.” Even so, she and her husband didn’t start Crate and Barrel to create social change. “When we began, [sustainability] wasn’t such a concern,” Segal admits, “but as we grew, we grew our social conscience.”
In those days, she recalls, “You had to have a moderate amount of success in the business community and make a profit – then you could go on and start saying, ‘we’re not going to sell teak anymore unless it’s regulated.’”
Even so, Segal says, she has always believed “that we need to take care of this planet, who works here, and what grows here.” She remembers becoming aware of and addressing child labour issues in some of their factories as the company grew.
In 1979, when Segal started Foodstuffs, a Chicago-based gourmet food and catering company, she understood that it was important to look at how food was grown and prepared. She deliberately stayed away from any extenders or additives in the foods she bought and sold. “By ’79 in the food business, we were becoming much more aware that ‘you are what you eat’ – that became our social conscience moving forward.”
Now I’m Also the Business Person
“Gordon is the business guy,” says Segal of her husband, who retired from Crate and Barrel in 2008 and now invests in startups among his other pursuits. “I’m more the design and creative person, and learned the business by osmosis. But now I’m also the business person,” she says, having started Foodstuffs and, of late, moving into venture philanthropy.
Here are just a few of Segal’s words of advice for entrepreneurs that she’s picked up along the way:
- Stay nervous, stay humble. Crate and Barrel began with one store and grew modestly. Segal believes it’s dangerous for entrepreneurs to start out today in a big hurry with overinflated expectations. “We believe that moderation is best,” she says, reciting one of Crate and Barrel’s company mottos, “Stay nervous, stay humble.” “Too many young people think that three years out, they’ll have a billion dollar company,” she says, exaggerating to make her point. Her advice? “Be the best, do it right, and develop your brand over time.”
- Stick to your knitting. Segal repeatedly came back to the idea of solidifying and staying focused on a clear business concept. “Try not to diverge too much from that concept. If you’re selling tableware, you don’t end up selling t-shirts or baseball caps; you don’t switch and go off on a tangent,” she says, throwing in, “Hopefully, the original goal is a good one.”
- Timing is everything. When it comes to developing and executing the “right” idea, Segal believes timing is key. “With Crate and Barrel and Foodstuffs, our market timing was great – we were lucky. We just sensed what the market needed, and held true to it.”
- Customers first. Though Segal and her husband sold the business 13 years, ago, Gordon was brought back in to help with lagging customer satisfaction. “The customer is a precious commodity,” notes Segal. “Always has been and always will be.”
- Be prudent when raising capital. Segal believes it’s best to look for financing from individuals outside of your family and friends if you can. “Partners don’t always work out,” she warns, “so be very clear about who’ll invest with you.” She then quickly adds, “But there is a whole market of people who have money, who are trying to think of who to invest in, who’s going to be the next Apple or Google or Facebook.” Financing is especially difficult when bricks and mortar are involved, says Segal, noting that Crate and Barrel’s store sales growth is at 2-3%, while their growth online is closer to 10%.
- Develop your staff and plan for succession. Asked if there was one thing they could have done better as the Crate and Barrel enterprise was growing, Segal says without hesitation, “Succession planning — the internal growth and development of our staff.”“To grow,” she continues, “you have to groom people. They may do things differently than how you would have, but they may do things better.” She stresses the importance of taking a team approach as opposed to a top-down approach, and developing people who do things very well. “We did half of that right,” she says, noting that while the company has always employed excellent people, they had a harder time developing top managers who loved being merchants, which mattered a lot at the time of sale.
- Have passion for what you’re doing. “We had a vision and a philosophy, and the money came,” says Segal. Ultimately, she says, “If you’re true to yourself and what you’ve done,” when it comes time to sell, you can feel good about it. “You have to know what’s right for yourself.”
Looking to the future
This will be Segal’s first visit to Hollyhock. “I’m always interested to see what the next generation is doing. I like to see ideas.” To point, she and her husband helped to launch the Segal Design Center at Northwestern, an incubator for ideas. “There are a couple [of ideas] that have come out of the Center that are really wonderful to see, and that look viable,” she says enthusiastically. Segal also was inspired recently by attending the Aspen Ideas Festival, and looks forward to seeing what other ideas she’ll hear about at SVI.
“Let’s just say I’m excited about seeing what our future may look like,” she concludes.
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