286 - Richard Parker - AUDIO - ENHANCED
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Corey Kupfer: [00:00:00] Richard Parker has been helping people achieve their dreams of owning a business for over 30 years. His How to Buy a Good Business at a Great Price program has sold over 100, 000 copies in more than 80 countries. He was hired by the Dalio Family Office and for several years worked as a mentor to one of Ray Dalio's sons, teaching him about the art of buying small businesses.
He has personally purchased 13 of his own companies, plus one co investment, with the purchase prices ranging between 50, 000 and over 200 million. He's appeared on Forbes, New York Times, Street. com, Entrepreneur Magazine, Inc., and has over 200 published articles to his credit. Duke West audience, please welcome Richard Parker.
Richard Parker: Richard, how are you? Thank you. I'm doing great. Good to be here. I appreciate you having me.
Corey Kupfer: Great to have you on. I mean, listen. And nobody with that bio is going to question, not only your credentials, but why I'm having you on the deal quest podcast. Certainly not a mystery. But before we go [00:01:00] there and talking about all your experience, with deals personally, the programs you have folks.
And what's involved in them. I want to take you back to when you were a little kid growing up, maybe eight, 10, 12 years old. What did you want to be? Because I'm guessing a, you know, a deal maker and somebody who do provides courses and training for people on how to buy businesses probably wasn't it back then, but you tell me.
Richard Parker: I wanted to be a player agent, actually. Okay. And, I have somewhere, I should look around the office, I know I have it here, it's, I had an article, I grew up in Montreal, there was a whole article written about me in the Montreal Gazette at that point, because a buddy of mine who was two years younger than me was playing Little League Baseball, and the Montreal Gazette reporter showed up, I'll never forget his name, Bill Whitcomb, and, he started talking to me and he said, my buddy Howard Kleinberg and, I had a big mouth and I interjected and started answering questions.
And the guy wrote a whole article about, the smooth young operator in the circuit that was going to be a player agent. And that's really what I wanted to be.
Corey Kupfer: That's too funny. Well, so I must have agents, agents and dealmakers in a different way, right? So I guess it was an element of that in there.
[00:02:00] That's funny. We have many, many more people who, answer that question is, wanting to be some sort of like baseball player or a smuggler, like, but very, very few that, you know, at that age was going to be an agent.
Richard Parker: Yeah. Well, I probably would have loved to have been a professional ice hockey player, but, you know, realized that that was probably a better path.
So, they, that's how my mind worked back then. I had my, started my first business at 12. And, so I guess I always had the entrepreneurial spirit in me or the deal making, the deal making, persona, if you will, and, just manifested itself in a different way, just a little larger.
And, as I look back, it's been a long time ago, but it's still fun. I mean, still have the time of my life doing this stuff every day.
Corey Kupfer: Love it. Love it. One other question. Looking back, what was your first deal of any type? Could have been something small when you're a kid, early in your career, whatever comes to mind, your first thing you consider a deal.
Richard Parker: Well, the first deal was actually when I was 12 years old, there was a, newspaper in Montreal called the Sunday express, which you could only pick up at the local store. They didn't have delivery. And I used to go pick it up for my dad. She's rest in [00:03:00] peace. Every Sunday and with snow storms, whatever's a real pain in the butt.
But I used to pick it up and then I called this on the express and said to them, Hey, you have to pick this newspaper up at the store. Why don't you have the delivery? And I convinced them to give me the right to deliver these newspapers. So I go, I went out and I sold a bunch of subscriptions and, started the, you know, they would drop off the newspapers.
Cause again, they didn't have any home delivery prior to that. And they used to drop off a bunch of them. And I. built up the road to, well, hundreds and hundreds of people, and then it became too much, so I kept a hundred of them, and I sold off different parts of the road to kids in the neighborhood, and I just took the two cents.
It was sold for 15 cents, and Sunday Express paid you two cents, plus you kept your tips. So I just kept the two cents, because what happened was, then the price of the newspaper, People used to give you a quarter. So it sold at 15 cents. They gave you a quarter. You made a dime. Then the price went up to 20 cents.
People gave you the same quarter. So my profits dropped in half. And I said, the hell with this nonsense. So I sold off the, all the routes, the kids, the neighbor. And I said, you keep all the tips. I'll just keep the two cents. And I was making like [00:04:00] 25, 30, 40 bucks a week, which was crazy. This is like in 1973.
So I always had cash walking around in my pocket. So that was the first business.
Corey Kupfer: Love it. Love it. Love it. It's I want. I've told my, you know, teenage entrepreneurial stories before, so I won't, tell them again. But, but yeah, it sounds very familiar. Trust me. I, you know, for me, it's pretty common, right?
It's pretty common. It was blue and white flyers door to door as opposed to newspapers. It was advertising circulars in people's doors. Perfect. Great stuff. Okay. So, so talk to me about how did you get in, right? So we said in your bio, obviously, that you have these, this program for folks teaching, so many people across the world on how to buy businesses.
You've done deals of your own. How did you get into the deal world? What's the background?
Richard Parker: I got into my first business. I was 29 years old. I was working for a company. I made a horrible mistake and blew 60, 000 in the stock market. And I was really in a hole. And it was the, when I quickly realized that I couldn't just change jobs where I was working.
I was overpaid anyways. And, so I couldn't get, You know, another job, more, [00:05:00] better paying. And even if I did, it would be, marginally more money and recognize that I've got to put myself in a position where I don't have a limit on my upside. And so I decided initially to start something small. And shortly thereafter, within several months, I made my first acquisition.
It was in the consumer products business. I was a manufacturer's agent and I bought out another agent shortly thereafter. Within a reasonable period of time, within that first year of operations, realizing, you know, for me to grow this business organically is going to be too much of a challenge. I might as well just make some acquisitions.
Cause I already made one small one. Looking back, I should have done it probably a little differently, but it wasn't a big mistake, but it worked out well and said, the quickest way to grow my business is just make some other acquisitions of companies that I could just tuck in and, you know, add more products.
I had a core group of clients. I was selling to big retailers in Canada. So I had a core group of clients, loyal clients. They said, I just got to. Find more products that I could sell to the same people. And so I started making some additional, acquisitions of products or services that I could sell to the same people and expand it [00:06:00] and expand it.
And in short order, bought a bunch of different companies and my business started growing, quite large. And one line that I took on, which was Sega video, which exploded at the time, nothing to do with me. I just happened to be the right person. In the right place, dumb luck, nothing else. Again, I take no credit for it and my business exploded.
And, that's how I got into the world of dealmaking, ultimately sold a number of the companies and relocated from Canada down to Florida in 1996.
Corey Kupfer: So, this is a question that I ask, I've asked others, but I'm particularly interested in it with you because. One of the things I often say is that I believe, you know, mindset's the starting point for anything, right?
Whether it's the jump from becoming an employee to becoming an entrepreneur, right? They're willing to take that risk. Some people have that kind of mindset. They're willing to do it. Some people will never do it. I don't have any judgment. Everybody should find their own. But, but I also, have asserted that, the mindset of a dealmaker is also different.
There are plenty of entrepreneurs out there and some of them run very successful companies. They're not dealmakers, right? They know how to market a sale or provide [00:07:00] great products and services, but they focus on the organic growth side, right? And some businesses can be very successful that way.
A lot of businesses though that, you know, that do the best do some combination of organic, you know, you have to be able to get a customer or client and another one, another one. If you can't do it organically. Unless you're just an acquisition company, you're probably in trouble.
But at the same time, there's this other way to grow. And it's not just M& A, but it's all types of deals. So for you in particular, I always am interested in dealmakers view on this concept of like, what does this deal make your mindset? How do you come about? And the reason why I'm particularly interested with you is I find like, you know, I also.
There's this concept, that, sometimes they call unconscious competence, right? Like, so, some of us are natural at something, whether it's being a natural, whether it's being a dealmaker, whether it's negotiating, whatever it is, and we don't really know how we do it. But, you teach people, and the minute we teach people something, we have to, sometimes, like, that's when we figure out, like, oh, wait, I really do have a system to how I do this, right?
I gotta be able to articulate that system, or else [00:08:00] I can't teach it to people. So with that big lead up, you know, I'm really curious because of that. Your thoughts on, on the mindset of a deal maker and how that. Not only how you came to it but was there a discovery process in that, from unconscious to conscious and then how does it affect the big, your programs for the folks that you're teaching?
Richard Parker: Well there's certainly a discovery process. I think when you talk about mindset, and I've worked with hundreds and hundreds and hundreds of entrepreneurs from small, you know, individuals on main street USA through up to billionaires. Yes. And I think the deal makers, because you're right, there's a lot of people who, acquire a business and they're good with that.
And that's wonderful. And that thrills me, frankly, because I love to see people change their lives. And you have other people who become deal junkies, as I call them. And I think in the latter category, which I would include myself, I think there's a couple of things related to the mindset. I think We all loved the journey [00:09:00] as much as the kill.
Getting a deal closed is very gratifying, but going through that whole process to get it closed, I think we find it, I mean, to me, I find it exhilarating, whether I'm doing it for myself on behalf of someone buyer or sellers, because I do both side representation. And I think that I find that exhilarating because you have to really, you Be on your A game all the time.
And also from the acquisition standpoint, I find it incredibly intriguing when you're looking at a business that you may not have known even existed the day before. And then you have to really dig in, get your fingernails dirty, roll up your sleeves and you become an expert in that business. And you don't have much time to become an expert.
You have to learn about it in a real short order. enough to be able to make a decision, yay or nay, to buy the business. So I think the intellectual curiosity part of that is really important. And I'm not suggesting for a second that I'm intellectual because I'm certainly not the smartest guy in the room.
But the, double click to that, if you will, is [00:10:00] this, thirst for learning. Yeah. And I think that's really, really important. So the mindset to me is a bunch of those different pieces, this, you know, the deal junkie mentality, the hunt and the kill, this obsession with learning and this intrigue with learning because we find it fascinating.
So I think all those things combined are really the mindset, of a, of, you know, of a deal maker or someone who's, likes to acquire multiple businesses or what have you. The discovery for me. I don't think there was really one aha moment that going into my first business was an aha moment. As far as like a one particular aha moment, Oh, I want to do this for the rest of my life.
I don't think that really ever happened outside of fact that I just really enjoyed that, this universe. Yeah. And so why would I get away from it? I mean, there's just everything is new. There's, I find it fascinating. And so, and the ability to morph into teaching others to do the same thing to me was just a byproduct of that because I've been so blessed in my life and wanting, and then [00:11:00] being able to help other people.
And certainly at this stage of my life to be able to, you know, extend that, to teach people how to do it. Cause I didn't start off with a lot of money. I mean, my first acquisition, basically we had a 30, 000, which I just did the calculation recently. It's like 75 grand in today's dollars. And my life has been changed.
I mean, I would have never been able to predict back then. So, being able to help other people do exactly what I've been able to do is, has been incredibly gratifying.
Corey Kupfer: And, one more, one last thing on the mindset, is there any additional thoughts when you think about the people you teach and train and whatever, the ones who are successful or less successful or actually take action versus just, I mean, because listen, I know many people who write, I mean, I run programs on negotiating, you know, but.
I know a lot of personal growth traders, a lot of business traders, wherever, and the amount of people who sit in a room and gather information versus the amount of people who actually, act on it is often very, very different. So anything in that mindset conversation around, you know, those people who actually take it on versus don't.
Richard Parker: It's a binary question because I've [00:12:00] gone through this for 20 years. It's very simple. The people that need to do something, get it done. The people that want to do something, not so much. So when people have a need to buy a business or. Adjust their thinking to the point of saying, I need to buy a business.
In other words, I'm not willing to do what I've been doing up to this stage of my life on a professional level. I'm just tired of it. I'm not willing to do it anymore. I need to do something. Those people on the whole get to the finish line. The people who wake up and say, you know, I want to buy a business.
Well, some of them will most of them won't. So it's the need versus want is the clear distinguishing factor. No doubt about it from my perspective.
Corey Kupfer: Yeah, I get that. And what I'm hearing is, and tell me if I'm off, is that the need, I mean, the need can be an internal driving dissatisfaction. It doesn't have to be like some outside force but it becomes at the level of a need as opposed to just a want or a desire, right?
Richard Parker: Oh, [00:13:00] absolutely. It doesn't have to be a need, you know, and there's different needs. Some are financial. Some is, in other words, to replace or generate an income. Some is I need to do this because I'm not willing to keep working for something for someone, someone like, you know, I need to do this because I'm working a hundred hours a week for someone.
I'm not getting paid accordingly. Others look at it and say, Hey, I need to do this because I need to structure my life in a way that I can spend more time with my family. I can take more vacation time, put myself in a position that I don't have an upside, but it, that, you know, if you were to draw a Venn diagram of all of that, need would be in the middle.
Yeah. People have different needs, but need would be the hub of all of it.
Corey Kupfer: Yeah. Got it. Great. So in, in terms of specifically this, how to buy a business at a great, good business, a great price program, talk to us a little bit about how, you know, how that's delivered, what it looks like, and also who the ideal, client or person to that, program is.
Richard Parker: So start with the last question, which is the ideal client is anyone who's thinking about buying a business or franchise. And even to a certain extent, people that are considering starting one, because I think [00:14:00] we. You in a very good way paint the picture to people that buying an existing business with a track record is infinitely better because you bypass the whole startup phase and like 96 percent go out of business in the first five years and the cost of acquiring a good business.
Is generally not much more expensive than a startup if you're going to do it right. And so that's the ideal client. Anyone who's thinking about going into their own business. That's the one thing. The second point is how it's delivered. We deliver everything by download. It's a 548 page guide plus tons of ancillary resources, interactive resources.
We have a proprietary valuation, software program that we develop using, it was a. A little over a thousand successful business transactions and a few unsuccessful ones, and really put together a valuation program that takes 50 fundamentals, core fundamentals of the business, not just the financials into place, marries it with the number and generates a valuation.
And so that's how it's delivered. And the whole goal of the program is step by step buying a business is not difficult, but it's [00:15:00] complex. And when something's complex, you've got to reduce it to bite sized pieces. And they always. A line up equated to, you know, I put together a few propane barbecues and in my time and every time like you get this thing, it's in a box and there's conservatively like 300 pieces in this thing.
Right. And, but if you lay out all the parts in order and you put the instruction guide in a, in an accessible place and you organize the parts and the pieces and you start from the bottom up, you eventually get, you have your propane barbecue. But if you just look into the box, you say, my God, I'll never be able to do this.
So the concept of this program is the same thing. It's all based on modules, 23 steps in the business line process from the first step being what to consider, like, should you even be doing this straight through to the last piece being your post purchase priorities. And in between that there's 21 steps from timing, getting organized, dealing with brokers, where to look.
Critically important is this third chapter, which is what determining what business is right for you. And then I'm getting into negotiation, valuation, due diligence, evaluating personnel, gathering information, [00:16:00] sellers to ask the questions. So it's a module based program, step by step, very digestible. I write, like I talk, I write, like I talk and it's very, I don't want to say it's dummy down it's cause it's not, it's just very simple.
And it also explains to the, You know, people that they're going to go through emotions during this whole process and how to deal with that because there are ups and downs. It's not just, you know, pixie dust and unicorns. And so how do you deal with the setbacks and the times where you feel like, Oh my God, like I, I don't know if I can keep moving forward.
Cause there are some low points and deals get fall apart or you get rejected. And so it talks about, it's a combination of aptitude and attitude.
Corey Kupfer: Yeah. So that's, I mean, what a great resource folks. Listen, it's like anything else. You know, I talk about the mindset talk about, with entrepreneurs, a lot of, and a lot of entrepreneurs, they conceptually understand, The reason for, or the potential benefits of deals.
But they're in that place of how do I get, how do I get started? Right. Or, are they looking to buy business? I mean, I had, it was a while back. I don't have the episode number in front of me, but I had, [00:17:00] Richard Marks on, who's a banker who mainly funds, searchers, look, buy business, right.
He said. And, so he gets SBA loans for searchers who are looking to, buy business. And, so that conversation, you know, like, okay, right. He's helping them solve one potential thing, which is getting funding. But what is it that takes somebody to even become a searcher or they decide, hey, you know, whether they're a corporate refugee, these like military folks sometimes are in that category, right?
They're getting out of the, you know, I have some friends and relatives who, you But the 20 in the military and now it's like, and some of them go into government jobs, but some of them. Right? One. Yep. And, and, you know, they have no idea, right? They have no idea what to do, right? You know, so it's, yeah it's great that you have that resource.
What other, I mean, you mentioned, sell side by side. What are the services of any, are you providing to who, outside of the educational programs?
Richard Parker: So I still do some sell side representation. I do this as much to keep myself busy. I work on a couple of deals a year, and I enjoy the process.
It's not done from [00:18:00] financial perspective. I just really enjoy it. So I only, I have, you know, I've been doing this for a very long time. So I have, deal flow. If I reject a lot more than they take on, I just like to deal with people I really like and really trust and enjoy. And I know I'm going to enjoy the process with them.
So I handle a few of those on the buy side representation. What I found when I Before the research that I did for my course was one of the shot big things that became very apparent with individuals I spoke with hundreds of buyers and when people and business owners and sellers and attorneys and accounts people who succeeded others that failed and especially on the ones that failed or buyers that acquired businesses and made mistakes was the one thing that was Very common to all of them was they would have loved to have had someone to hold their hand through the process.
And someone who was really an unbiased advisor, you know, and I do some brokerage work, so I'm not disparaging brokers. I'm in that world. But the reality is people don't realize that business brokers are not your unbiased advisor. They want, you know, they, their agenda is to sell you a business and may not be the right one, but that's how they feed their families.
And that's cool. I'm not judging them. That's [00:19:00] cool. Cool. Thanks. But this concept of having like a Sherpa or a real guide for somebody, and that became shining through. And my agenda was really just to help people. I mean, I never thought it would turn into a business. We sold a hundred thousand plus copies.
I mean, it's mind boggling to me. So one of the things that we do as part of it, which takes up the bulk of my time and I love doing is I. Provide free consultation to anyone who buys the materials. I never charge them so they can email me I we give them great responses when they're in the throes of a deal We've could be spending time on the phone together and i'm their standby advisor And so that's a huge part of it Part of the time that I spend and I love doing that.
So that's a really large part of the services or other things that I do. Cause it's, you know, I probably answer a hundred emails a day.
Corey Kupfer: Yeah, I got it. Love it. All right. So I want to go back and talk about some of the deals that you've done for two reasons, because obviously, you know, doing deals, there are always lessons, you know, you said, That was it.
I mean, you aren't talking about yours, but you talk in general, what you gathered for your course, a thousand that worked and the few that [00:20:00] didn't, I don't know, I don't know, a deal maker who doesn't have like, nobody's batting a thousand, right. You know, how, no matter how smart, no matter how good you are, whatever.
In fact, all of the processes that you. You know, if you're not willing to take a risk on having, a loser or, one that's just okay, or whatever you're there, then you're not going to get the winners either. Right. So talk to me a little bit about, some of these deals that you've done, sort of lessons learned.
And then obviously. For me, that gives you much more credibility to the course, the, to the program you have, because, listen, it gets overplayed but, you know, like there's that old disparaging comment about those who, you know, teach, can't do.
And those who do, and there's, I think there are significant exceptions to that, but I do value. Somebody who's teaching somebody who's actually done it themselves. Right. Right. Yes. As opposed to, you know, especially in this world, because deal, you know, deals are not academic. They're real world on the ground personalities, businesses, industries, economies, like, this, you know, the theory only gets you so [00:21:00] far.
So tell us a little bit about the, these various deals that you did, ones that work, ones that didn't work, some lessons learned.
Richard Parker: So it's a great question because, one of the things that you touched upon is real world experience and with the internet, there's just the proliferation of people allegedly teaching people how to buy business.
These self anointed gurus, most of whom have never bought a business before or misleading, misguided information about buying business, good businesses, great businesses, they tell you for no money down or whatever. I mean, it's complete BS. It's nonsense. And unfortunately, people fall for it and they spend thousands and thousands of dollars and they just ruined, someone just ruined someone else's hopes and dreams.
So it's, I think it's disgusting. That's part of my motivation and obligation to really get out there in shows like this to spread the good word of what's real and what happens in the real world. And so from my own perspective, the one thing that I learned. Is you know, I learned something new in every deal.
I mean, I've been involved with hundreds and hundreds of them, but I still don't know everything by any means. And I learned something new in every deal. I will tell you that the deals that really crap the bed for me [00:22:00] personally are the ones where I learned the most. And it's what you take from those lessons.
And from all the businesses that I acquired and made, if anyone tells you they didn't have any bad deals, they're either not doing enough deals, right, or they're full of it. So that's a few of them, plenty. And the thing that I learned from the good ones, the bad ones, there are some common things.
And part of this became the genesis of what I teach and preach. Is the single most important thing that you've got to do in this is you've got, if you're going to be an owner operator is you've got to match your greatest skill set to what drives the revenue and profits of a particular business.
If you do that, you can do an average job on the rest of the whole transaction, like you can overpay a little bit, you might miss something in due diligence, no catastrophes, of course, but you could do an okay job on the rest of the stuff. But if you don't get that piece perfect, you're going to get be in trouble.
Similarly, if you get that right, you're going to flourish, right? So [00:23:00] that became like the pinnacle of the learning is identifying the right business feud. Now the right business doesn't mean it's a good business. It means that it's the right business for you because there's lots of good businesses, but if they're run by the wrong person, they'll go bankrupt in a year.
And there's a lot. Similarly, there's lots of good business run by the wrong person now. But if you, so if you attach, if you've got the right skillset for that, you fundamentally should be able to improve it. drastically. And so that was probably the greatest learning from all the deals. And I've done what I, you know, so that's really important when I stuck to areas that I knew I was okay or did well, when I got into other areas, I failed, miserably.
And I guess you call it fail, I, you know, failure or failed well because I learned from them. And it's two things that I was able to extract from them was, I was able to put together what I call my five golden rules, which I teach people that the five things that they should have in place of any [00:24:00] business they consider purchasing.
And they're all personal. Like, so I've been able to evolve those to what I've been able to learn over the years. For example, in one business that required, there was no demand in place. It was a tremendous product. It was in the golf industry, a video golf business. And I was actually working for this company more so than acquirers, working for them.
And we went public as a chief operating officer, but there was no demand. We have to create demand and it was way too expensive. You just couldn't educate the masses enough. And that became a golden rule of mine along with four others. I'm happy to share if you'd like. So when you get into certain deals, like one of them, we acquired this retail, a merchandising company.
I was in the consumer products business. I knew that. When I would sell my products at a big retailers in Canada and I started going to the stores. And I'd never seen my stuff on the floor. Like it was stuck in the back room because they were going to, all of them were going to a self service model because labor was becoming so expensive and stuff was never being put out onto the floor properly.
And so I ended up acquiring a small retail merchandising [00:25:00] service company in Eastern Canada. Inquire, they actually came in as partners. And then we expanded that model out and started servicing retail stores across the country at 200 people. We grew that business from, it wasn't even six figures to four and a half million dollars.
And just to give you some context, 10 percent of the population in Canada. So that's like a 45 million business in the U S and that's 30 years ago. And that was really the application of form to function, realizing it's not good enough to just sell my product to a client. I have to make sure that product works for them and works for them means they sell it through the door, through the consumers.
So that was really good learning. On ones that I failed, sorry, go ahead.
Corey Kupfer: On that one, I just want to hop in because On that one, it really illustrates something that I often say, and in fact, I'm going to be in Singapore in April at the Global Leadership Conference for Entrepreneurs Organization.
I've been an EO member for a long time, and I, I'm the, my EO Deal Exchange, Chair, Champion, so we do a conference, Deals Conference for EOs every year. And at the Global Leadership Conference, I'm doing, some talks, [00:26:00] and the talk is going to be, like a lot of people think of the deal first, right?
And they're like, Oh, M& A. I know how to do. I don't know how to do whatever it is, right? The talk is actually not going to come from the perspective. It's going to come from what is your business problem, frustration, issue or opportunity that you're not taking advantage of. Okay. Well, that business problem was we have merchandise that's not getting out to the floor, right?
Well, now you can try to solve that business problem organically by talking to the stores, trying to encourage the store managers or whatever to put it on the, whatever, right? But what you did was you said, Hey, what kind of deal can I do to help solve this? Right? I'm going to part with or, you know, acquire or whatever that looked like with this company that you mentioned, and we're going to go solve that problem.
So the reason I want to stop you and illustrate that was that. My assertion to our listeners, and it's going to be the topic of my talk in Singapore, is let's start with whatever the business problem or frustration is that you have not been able to [00:27:00] solve, right? Hiring is a great one. I mean, they're, I mean, tough to find talent these days.
Well, sure, go through your recruiters, post it online, do whatever. But if you have trouble finding talent, have you considered whether you can acquire a company's name? I mean, There are more acquisitions these days that are driven by talent acquisition more than, anything else, more than the technology, the assets, even the client list for some of these companies, because that's a problem to be solved.
So I just wanted to highlight something that you did, which is that you saw a problem and went to an inorganic deal driven solution for that. And I just want to help people think on how that might apply in their lives as well.
Richard Parker: And there really are. applications to almost any of the problems. In our case, not only did we, really just, we took control of the situation, say we have to solve this because no one else is solving it, the retailers weren't solving it.
The other thing that we were able to do, because it was such a good solution. We then went out to other companies that were selling these retailers and said, here's what we're going to do for you. Yeah. And they put up a huge resistance, so we couldn't get [00:28:00] any contracts. So what we did was, we said, you know what, we're doing this ass backwards.
Why are we going to them to tell them we're going to help them, even though they knew it was a problem? By us providing that service, it would cost them a lot more money, shrink their margins. We went to the retailer and said, hey, it's not just us. You got 500 other suppliers that have the same problem as we do.
Why don't you go to the suppliers and you force them to do the servicing? Yeah. So they used, so you know what, they were all pissed at us. But. And grudgingly brought us on board, but here's what happened once they realized that their sales exploded, they didn't realize how much they were leaving on the table.
Their sales exploded as a result, because you know what, no matter how good your product is, if you don't put it in front of a consumer, it's meaningless. And so it took a little time. We aggravated a lot of people. The retailers loved us because where their sales were going up, the merchandise was on the floor at events, they were getting the product and slowly, but surely the suppliers came on board.
We ended up servicing thousands of stores across the country for many, many different suppliers and turned into a, you know, it was a [00:29:00] wonderful business, a lot of logistics, but a wonderful business.
Corey Kupfer: Yeah. Love that. So you were about to go on to some other, things learning from the old failures and stuff like that.
When I so rudely interrupted.
Richard Parker: Yeah, and he didn't rudely interrupt, jumped right in. So I could talk about this all day and I get very excited. So, well, another one I actually acquired a, it was in the retail sector and, It was a, a concept related to actual ladies shoes, one price shoes.
We bought out all manufacturers. I partnered with someone, they were huge in buying out the, end of season closeouts from all the major manufacturers because in the ladies retail shoe business, the shoes that you see at, Bloomingdale's or Macy's for 80 bucks and the ones higher up for 300 coming off pretty much the same line with some minor adjustments.
So they were buying these ends of lines of shoes and we were able to go in and this company was buying hundreds of thousands of pairs and they were doing it through retail and wholesale. I love this concept. So I, partnered with them. We opened up a massive store in, West Palm beach, it's about 12, 000 square feet at 60, 70, 000 pairs selling women's shoes at 888, [00:30:00] 1288 that you would see at Bloomingdale's and Macy's for, you know, for 50, 60, 70, 80 dollars..
And we were hit and we spent a lot of money promoting it. I was working in the business cause I really wanted to learn it, which was important to me before we even opened up the lineup around the block. The first day it was great. We made money that we opened up, we made money the first day. But one of the things that I learned in there were actually, there's a couple of things.
Number one. We went through a hundred people to find 15 good staff members. That was number one. Number two, we couldn't get the concept. We didn't believe the concept would travel. In other words, our goal was, and I went in this with the park and I said, well, the goal is to roll out 10. The 20 stores quickly, like let's get the one, right.
And then roll out a bunch of them. And we didn't feel we could get the model to roll out because it was so demanding related to personnel and the management in place. You have to have top tier people besides who worked on the store on the floor. You had that amount of pairs. You had to help clients. We had the shoes stacked, you know, Florida [00:31:00] ceiling, beautiful location, well organized, but everything was on the floor.
You didn't run back to get the pairs in the back. And then we realized, this is long travel. This concept is just not going to travel unless we duplicate. our managers so effectively and we didn't feel that we can do this because of the high level service that we provided. So the lesson learned in there was when you have a business that's related to talent and employees, and most are, but not all, but most are because sometimes there's an augmented level of talent.
When it's related to an augmented level of talent, you have to make sure. That you can acquire those people, bring them on board, train them properly. We did, but the effort was overwhelming and said, we couldn't just have a store 200 miles away and feel confident that could be duplicated. And we didn't want to water it down.
Like saying we can't have a case where the five locations where we are great. And the other one is just, it's like 80 percent of it or 40 percent of it. Cause then you really hurt your brand. So the lesson learned there was when you're getting into a business where [00:32:00] talent isms. Is so important. Like you talked about acquisitions for talent only is you have to make sure you have the ability to do that.
And I didn't do that very well. So that was a terrific, terrific lesson. Like I said, it's very easy for me to go on and tell you about the, grand slams because I had a few of those, but the lessons learned were really, really from the ones that I, that didn't work out well.
Corey Kupfer: Yeah. Yeah. And that's a common theme that, you know, I know anybody who, you know, whether it's a deal maker, whether it's Sasha Barusha, and, you know, you mentioned smart failing or whatever you call it.
I forgot what you did. Fail well. Fail well, yeah, yeah, yeah. Fail well. The only one I like sometimes is fail forward fast. You know?
Richard Parker: Yeah, yeah. You want to fail fast. That's always less painful. Yeah, yeah. I agree with that. right? Yeah, and forward.
Corey Kupfer: Right, you know. So, yeah, and listen, not everybody's willing to do that, right?
I mean, there's, and again, no judgment, but that's why, know thyself. I mean, are you willing to, be that kind of person? And then, like you said. They're not, no, they sell PC, you point it out as, is aligning with the right kind of business that fits with your particular interest and skills.[00:33:00]
You know, I often talk about, this concept of highest and best use, right. And ideally, we're all in our highest and best use area. I don't believe I'm not talking about in terms of personal growth, but, in a business I'm going to overstate it a bit, but I largely don't believe working on your weakness.
And I believe I'm with you a hundred percent, but dribble down on your And then build systems and team and other people who are strong and, you know, with
Richard Parker: absolutely, yeah, work on your weaknesses when you're working for someone else. Yeah. Right. I mean, when you go into your own business, that's not the time to bolster your weakness.
You have to make sure that you can hire for that, but you have to focus on your greatest strength and because that's not the time to be working on your weaknesses because that's not where the business is going to be able to grow. As a matter of fact, if you have too many weaknesses, well, certainly if the, what drives the business is not a strength of yours and potentially even a weakness, you're going to get into trouble in a hurry.
So weaknesses are great and you could work, should work on them, right? In time with the proper allocation of time, but when it comes to acquiring a business, that's not the time to be doing it right.
Corey Kupfer: Right. At [00:34:00] all. Yeah, no I love it. I always say for me, I say this three elements of what I call is the best use.
One is that it's got to be something that you're great at. But like I, the joke I say is I'm really good at drafting documents as a lawyer. I'd never like, I haven't drafted, like I have people for that, right. Because I'm not passionate about it. I also want you to be passionate about it.
Now, high level strategy structuring, okay, yes, that I'm passionate about. But there's got to be another piece, and it goes to what you were talking about, I think it aligns with what you're talking about. There's this, it's got to, and people miss this they think, oh wow, I'm great at this, and I love doing it.
But it's got to be highly leveraged, it's got to move the needle, it's got to make a difference, right? Yes, amen to that. And that's similar to what you're talking about, and people, I'm amazed that often people miss that. It's like, no, no, no. And this goes down to that double and tripling down.
Like if you get that right, as an entrepreneur, as a business owner, as a leader, and you're able to say, this is what I'm great at, this is what I love, but this is also what moves the needle. What I can uniquely do that actually nobody else on my team can do, right. They can do all that other stuff. Which is, by the way, a bigger universe of stuff that I'm not [00:35:00] good at or don't want to be doing.
Right. But this is the thing that is my special sauce. And this is what's going to really move the needle. That those are the entrepreneurs and business owners that are most successful.
Richard Parker: Absolutely. It's what drives the business, what I'm great at. And one thing you mentioned, which I'll push back on a little bit, when you talk about people, what they, you know, what they're good at and what they're interested in.
Yeah. People get very confused because what you're interested in or what you like doing oftentimes is not really what you're really good at. And so, you know, and sometimes the interests get cloud your judgment about what is your greatest skill set. And that's why for some people, they can identify it right away.
For others, they have to go outside of their own little bubble and speak to colleagues and former bosses and even clients or whomever, and get input because what people like to do is usually what they spend their time on, but it doesn't mean what they're really good. At doing. Yeah. And so that gaining that clarity is so important.
I mean, couldn't, can't even overemphasize how critical that is because that's what's going to really move the needle. It's like, what was that [00:36:00] movie with, Liam Neeson when he talked about, Taken, when he talks, I have a very specific set of skills, right? You know, that's the way you got to look at it.
Like whatever that skill is, I'll find you and I'll kill you, right? Or whatever you said. And that's the way you have to look at that specific set of skills. Other people may have it, but you know that is your greatest skill set.
Corey Kupfer: And you're right. I mean, when I say you have to be good at it and you have to be passionate about it, but I love that point that, You're passionate about something could give you a, a false sense.
Yeah. It's overrated passion. You have to be objectively good at it, right?
Richard Parker: Objectively good at it. Yeah.
Corey Kupfer: Yeah. Yeah. No, that's great. That's a great point. Great. So, anything else we're coming to time, so I'm going to come to my last two questions, but before I get there, cause I feel like, listen, with folks like you who've been in this world and, you know, I'm such a deal guy as well, like I.
You know, we could sit, we could do a 10 hour podcast, but we're not, you know, right, we're not going to, we're not going to put a few people to sleep, right? Yeah. Yeah. Yeah. So we got [00:37:00] to pick and choose here. But, before I ask you my last two questions, is there anything else, whether it's about the, let's do this before you, you mentioned the five, the golden, rules thing, right?
Yes. But, Yeah, let's, why don't you share those with us before we, before I answer my final two questions?
Richard Parker: Sure. And you know, these are my five, they're not applicable to anybody that, but it's important to have your five and they could evolve as you're learning about different businesses and going through the process and it's, you know, involved for me, but I will only buy a business that has five.
I'll never buy one that has four. So for me, it's as follows. Number one, the business has to be sales and marketing driven, because that is my greatest strength. Number two. The business has to have high margins. And the reason for that is I don't really care about the revenues because I'm comfortable with my skills and sales and marketing.
So if the margins are high, as long as I'm able to drive the revenue, the profit is going to follow by default. The third thing is I'd like an element of exclusivity in a product or service that I'm selling, whether it be a territory geographically, whatever the case may be, but it's some element of [00:38:00] exclusivity to the, product or service that's being offered.
The fourth thing is. I want a business where demand is in place. And I talked about that earlier and I learned that the hard way creating demand is much too expensive and darn near impossible in most cases. So the man's got to be in place. And the fifth one is I want a business that does not compete on price.
I don't believe that is a sustainable business model because you have to go back into business Every single day. And so those five in sales and marketing driven element of exclusive exclusivity, high margin demand in place and not competing on price. Those are unbreakable five golden rules of mine that are been a tremendous guiding principles.
And so for people that are looking to acquire business, what I teach them is why I, how I came up with mine, but how they need to come up with theirs and understand at the beginning, they may not know. And it's very important to be specific. In other words, you can't say. You know, one of your rules can't be, I want to enjoy what I do.
Well, of course, [00:39:00] everybody does, but what, like, how do you know that? And it's, and it really like, that's meaningless. And if you dig into that and say, well, what's the root of that? Well, they say, well, I want to enjoy what I want to do means, I want to work somewhere related to, product or service for kids.
Well, now you're starting to get close. So one of your rules will be is the product or service has to be geared towards. Towards children. So that's how we get to the five golden rules because we don't want them generic. We want them really, really specific. And then you could put each business through that test on two levels.
One is my greatest skill set driving going to be the driving factor of that business. And second to that, does it meet my five golden rules? Cause if it doesn't comply to both, you got to walk.
Corey Kupfer: You know, I love that as far, you know, I've been interviewing for, we were growing fortunately, the iron and other attorney.
Right. And I've been interviewing, and one of the things that, you do in an interview, obviously, you're interviewing other people, but, I want people to understand, the philosophy, and, I have a very clear vision and philosophy on the way I run my firm that's different [00:40:00] from a lot of other firms, the reason I left big, you know, big law practice many, many years ago, like you, it's been 30, whatever years since I've been doing this, But, you know, and one of the things, I mean, one of the, it's not the other one, but one of the residents to me is like, I knew I never, this isn't in connection with acquisition, but it's a similar process to determine who you are in business, right?
Whether you're acquiring it or whether you're creating it. You know, for me, I never, like in the early days when I first started on my shingle and was paying my right off credit cards, because I had new clients and, you know, and it was doing everything you weren't supposed to do because I worked in big law and big law discourage you from developing your own business.
And I was only less than six years out of school when I said, I can't do this anymore. And I got, you know, and I hung out a shingle and probably if I knew better back then I might have, maybe I would have, you know, acquired a law firm, but also law firms back then there were issues with it. But the smart
Richard Parker: thing is that is he got the hell out
of there.
Corey Kupfer: I did. But, you know, one of the things that I got very, very clear on early on is that I did not want to be in any kind of low margin commodity type part. And you have that, like people are doing residential real estate closings that like, you know, no, no money. And I'm like, yeah, how do you like [00:41:00] I, my interest, my desire, my skillset, my, my need to serve as clients in a certain way.
Did not allow me. I mean, yes, you can create a business. That is a real estate Closing mill where you have systems and a bunch of paralegals and you barely look at a file and you and it's about it's a It's like any other volume business, right? You know, you make the largest at a high volume It just did not align for me, you know, I need so we you know everything and you know We don't do any residential real estate anymore, But that was, that early mentality was like, no, no, no I want a higher end, higher margin, customizable, you know, more personal service kind of business.
And, so it's just, you know, I'm personally relating to what you're telling people Right. In terms of looking at it because, and I agree with you, by the way. I don't like a rush to the bottom on price. I think it's a bad business model, but there are some, you know, Walmarts or whatever, there are some companies that have.
They get out that model and they win at it, right. And it's fine, you know, because,
Richard Parker: but they could do it at scale, right. They could do it at scale.
Corey Kupfer: Final two questions. The first one is just that people find out [00:42:00] more about your program, everything else, you know, any place you want to send them.
Richard Parker: Yeah. The easiest place is go to richardparker. com. We have lots of tons of free articles, free reports. The course that we offer, is available there as well and explains, the details of that. And we sell it. What I believe is a very reasonable price for under 200. But if you can get lost in the world of learning about buying businesses on richardparker.
com, tons of great articles broken down by different, steps in the process and people will find that very helpful.
Corey Kupfer: Great. Excellent. And that'll be in the show notes if you're driving. So, whatever. So definitely check it out. My final question on the podcast, Richard is always about my highest value in life.
My highest, ideal, which is freedom. And for me, that means everything from freedom around the world for, for people from oppression to why I've been an entrepreneur and I've been at a boss for decades. What does freedom mean to you and how does it impact your life and business?
Richard Parker: Well, I think at the high, it's a great question.
I think at the high level, you know, it'd be very easy to say, to be able to do what you want to do when you want to do it. I mean [00:43:00] that, but I think that's pretty generic. So to me, there's an offshoot to that, which is the freedom to be able to make, to have options and to make some real good choices that you could impact the lives of others.
And I don't want to sound too ultra altruistic, but that's really important to me. And when I see the impact, the lives of others, it's not just in the business sense, it's in family sense and what have you. And I think about it, you know, playing ice hockey for. My God, 58 years. My son was a high level, hockey player playing junior in Massachusetts.
We're a hockey family. I probably watched 300 games a year. And I find that there was, the example that he gives to people, which really impacts me related to freedom is this one hockey player, Sidney Crosby, and he's one of the greatest players ever. And I'm sure you're familiar with him, but you know, the one thing that he does is makes everybody, when they bring up a new player, they always put them on his line.
And the thinking is, if you can't succeed playing with. Sidney Crosby, okay? You don't have like a hope and a prayer, right? And so, because it's very different than [00:44:00] what most coaches think. They bring players up, they put them on the bottom line. They always put the player on the first line, give a rip.
And what he does is he makes everybody around him better. Yeah. And, So I look at freedom to say like, you know, giving me the ability to make people around me better, whether it be in my personal relationships, my business relationships, the materials that we provide, the work that I do it's really all encompassing.
And I think that comes with options and that you're able to make some of these choices because it's not all about money by any means it helps, but there are other options available and how you could impact life. So to me, the freedom is really the ability. to impact in a lot of areas, and hopefully that makes sense to your question.
Corey Kupfer: Now, it 100 percent does and I identify with it because, you know, being of service which is, the way I often phrase it is significant, to me. And again, it's I mean, I'm of service in a way that is, you know, cool traffic, but I'm also it's a [00:45:00] fundamental core of my work. You know in my law firm and whatever and I and you're right I don't think you know, it's not in fact I think the more service of service you are the more financial reward you actually get right?
Because if you don't come from the money if you come from a service mentality, then that's what attracts, you know People and you know to you so I totally You know I totally get it. So, ,
Richard Parker: I agree with you. I think if people's heart is in the right place, if you start out with helping and not with some BS saying, this is what we're going to, but to really believe it to your core, you know, and, I was asked recently about some of the successes that, people that I've worked with have achieved and then, and the answer, and very similar to this is, you know, the people that I worked with and I've worked right up to billionaires, people who've had massive success, you know, on a lower level, but also like crazy massive success in business.
Yeah. It seems like none of them ever came care about the money. It's always like, they're just obsessed with building a great company, empowering people and what have you, because if you're in a situation where there's an economic benefit and your goal is, I just have [00:46:00] to figure out how to help the world who were going to deliver this product or service to the money is going to follow by default.
It's inescapable. And so. Having that higher level and it's, and again, it's not just BS mission. It's really to your core and into the company's culture and fabric and DNA believing that, you know, if we get up every morning to help people, ultimately it's going to pay, it's going to keep the lights on.
Corey Kupfer: That's right. A hundred percent. Richard Parker. Thanks for being such a great guest on the deal quest podcast.
Richard Parker: Thank you. I appreciate you having me.
