Living the leader's dream
Cinde Ingram -- Casual Living, March 8, 2012
Today, some say the newton family is "living the dream" of the casual furniture industry. But they had "nothing but ambition," according to Jerry, when he and Linda Newton founded the now 19-store Leader's Casual Furniture retail chain in 1979.
In fact, because their tropical setting offers a good test market for outdoor product in the often brutal Florida environment, the family's backyard "sometimes looked like a flea market" as they made sure groups would weather the salty air, heat and humidity, and that various materials would hold up for their customers.
Today's challenges are different from the ones Jerry and Linda Newton faced when Jerry left his corporate job running a data processing center for banks and other businesses. He joined a friend of a friend who was looking to expand a small patio furniture business that had started in 1971 in St. Petersburg, Fla., and the first small store he opened was buried in a Bradenton, Fla., shopping center.
"My new partners got me all excited about this cool inventory they were going to give me to sell," he said. "My first store was filled with scratch-and dent and clearance (product) from their other stores. I got all this refurbished furniture and I was excited about it. I thought it was all great and I sold it all right away. It was all about the naïve energy, I guess."
That store ran so successfully that in the early 1980s Linda left her job at a doctor's office and began working alongside Jerry when they opened a second store in Sarasota. "We ran the showrooms; we sold furniture; we closed the store at 7 p.m., then we went and delivered if we had to," Jerry said. "We got those two stores up and running successfully. Now we had two tigers by the tail."
"In 20-plus years we never had a down month in our company before the current recession," Jerry said. "We literally went many, many years always beating last year, always beating last month and the same month the year prior."
They were so emotionally invested in their business, Linda recalled, "Every time we opened a store, I would tell everybody ‘We're having a baby.'"
Tami Newton and son Jackson cavort with nephew Fisher Newton poolside on Palm Springs Rattan & Garden Classics’ Kokomo sectional.
All that giddy growth changed when the recession started to affect warm-weather states like Florida. That also was about the same time the Newtons started transitioning their business to the second generation.
Their daughter Tami, son Tim and his wife Ashley laugh when they hear that others consider their work or location to be idealistic. Despite her perpetual positive attitude, Tami remembers she and her brother "both had a little anger with our parents for working so much when we were younger." While Tami knew early on that she wanted to join the family business after college, Tim did not. Today they run the business with their parents' same "do whatever it takes mentality," Tami said.
While in high school, Tim had worked unwrapping furniture on the distribution dock in the summers. He also worked part-time in a retail clearance store at the end of high school. He had no intentions of joining the family business when he began to pursue higher education in engineering and business management. After taking classes for five years with no break, he took a summer off from his studies and worked in one of the Leader's stores in Orlando. After finding he enjoyed interacting with customers and trying to meet their needs, Tim took another look at the family business and worked to improve his skills on the sales floor.
It didn't take long before Tim got an opportunity to try to turn around one of the retail chain's struggling stores. Finding his ability to successfully improve failing stores in short time, Tim began taking on more responsibilities. He gradually moved into his position as managing director.
Tami worked nights in an Orlando showroom while attending the University of Central Florida earning her degree in business management. She quickly showed her ability to sell product and to make customers happy and loyal. She ultimately established Palm Springs Rattan, Leader's off - spring wholesale division. She now directs both the wholesale and commercial sales divisions of the company.
Ashley was recruited by Tim from college as both his wife and a member of his trusted leadership team. With an uncanny ability to learn, she rapidly earned her position as director of merchandising and advertising for the company.
"I think it worked best because we had to work to get our opportunities," Tim said. "It wasn't ever written down or said that we would be able to have our positions. There were two people that were in succession before me. We all worked hard and we all tried to do just the right thing for the company. We had opportunity, but it wasn't implied or given. That gave us the right culture and the right mindset to learn and earn our positions and be able to move forward smoothly with the respect of our fellow employees."
The Newton family, from left, Ashley, Jerry, Linda, Tim and Tami, inside a Leader’s Casual Furniture showroom.
Opportunities and Strategies
Both generations at work in the family-owned business have operated by taking advantage of opportunity, technology and being assertive enough to step over a line when the situation calls for it. All are also nimble enough to shift in the other direction when needed, finding balance with one foot in retail and the other in wholesale - following one of core philosophies of founder Jerry Newton.
"I believe in becoming aggressive when the situation warrants it, but I'm never going to put myself so far on the other side of that line that I can't quickly step back," Jerry said.
Ashley referred to Jerry's "line" philosophy when she described why she thinks the company culture is successful.
"Not every day is a dream, but when we step back and truly evaluate where everything is, I think we all feel very privileged and excited for the opportunities and how genuine Jerry and Linda have been in supporting everyone," said Ashley, who met Tim in college and brought a keen design sense to the family business.
Ashley pointed out examples of company officers who started years ago in entry-level positions, understood the climate of peer competition and rose through the ranks. "Jerry and Linda have done a great job of creating a place where people want to be and want to work," she said. "Everybody has opportunities; they feel important to the company and its success."
"In my opinion, the Internet has created so many more sales and has helped our stores to be more successful in the tough times because we have so many pre-qualified customers coming in," Tim said. "There are so many customers who come in understanding already what they want."
Leader's Casual combines direct mail with radio and online behavioral marketing. Whether or not they purchase, visitors receive thank-you cards that urge them to return for 10% off of any or all accessories.
"Because online is such an important resource for consumer research now, for every delivery we give a questionnaire to our consumers asking them to rate our performance," Ashley said. "We get about a 10% return on them all, but out of that 99.9% of them are phenomenal reviews with great customer comments. We worked that program now so if they put that same comment online and show us, they'll get half off of an accessory. Instead of just telling us, they can tell the world and other customers so that as other customers are researching us they see all these great, positive reviews."
While their parents expressed concerns about the second generation transitioning into leadership positions about the same time the economy took its downward turn, Tim, Ashley and Tami viewed the recent recession in a different light.
"It taught us how to do a better job and run a better company," Tim said. "We do the same thing we've always done: We do the best job we can to bring our consumers good product at the best value. In the industry, some of our competitors think we're discounters when, at the end of the day, I'll bet you that our margin is higher than theirs because we don't negotiate or do all these aggressive markdowns. We travel the world to try to find the best value. Our consumers who know us and shop us, love us."
Tami Newton kicks back to relax with Casual Living magazine on Palm Springs Rattan & Garden Classics’ Kokomo Outdoor sectional double chaise lounge with coordinating toss pillows.
"In the operations side, where we're extremely strong, we're always looking for efficiency and becoming more productive with the people we have, and so we're doing a major soft ware upgrade in our distribution center," Tim said.
"We've always been ahead of the curve in technology, but last year we saw an opportunity to invest in a warehouse management system that is commonly used by much larger companies. That's going to be phenomenal when it's done, and it's already about 65-70% implemented. It's going to bring us accountability and instant information to our workforce that will help keep them motivated to work harder and smarter.
"We're always trying to become more efficient because we move a lot of pieces. We move well over 1,000 pieces a day and we have to do that very efficiently. If you can save a few seconds on a move, you're talking about many hours a year."
More stores may be added if the opportunity presents in areas where a location is needed. "On the sales side, we're always working on our presentation," Tim said. "We're never going to have the biggest store, but we always want to be presented in a fresh and current way to the customer. So we look at our displays and we try to use our merchandise mix more appropriately, and we know we can always do a better job."
Tami credited her parents for allowing her generation to do things their own way, even if mistakes are made or it's not the path they would have chosen.
"As far as succession goes, we had a lot of influence on the proper steps to take from actually our landlord here at the warehouse because he had done it with his family," she said. "As hard as it's been for my dad to step back, I think my brother is doing an awesome job. He's in there to win it and make things happen. He's taken on a lot of my dad's traits when it comes to handling certain situations. He very calmly says ‘Give me the facts and I'll figure it out.' But if he doesn't know the answer and he's not familiar with the type of situation, he's not afraid to ask for help.
"I think my dad says he talks to my brother more now than he ever did while he was growing up and so it has become a bond between them. Although my dad won't usually say it to us in person, he certainly tells many other friends and family members how proud he is of what is happening with the company between the three of us."
Linda said she had a tougher time than her husband with handing over control and stepping back from the business they built. After five years, Linda now enjoys being able to spend more of her time watching over their grandchildren: Tami's 7-year-old son, Jackson, and Tim and Ashley's 3-yearold son, Fisher, and 8-monthold daughter, Reagan. "We're ‘living the dream' in that we have responsible young adults who are taking the lead and are doing a phenomenal job," she said. "We couldn't be prouder of that."
"Linda and I just feel so fortunate that the work that we put into it, the base that we built, has not been wasted," Jerry said. "It's been enhanced and is moving forward."
Palm Springs Rattan & Garden Classics’ whimsical indoor accessories convey a penchant for the casual lifestyle and offer the allure of add-on sales, as well as a steppingstone to bigger-ticket purchases.
1979 - Jerry Newton opens a small store in a Bradenton, Fla., shopping center.
Early 1980s - Linda joins the business and the Newtons open a second store. The retailer opens a factory in the Philippines to manufacture rattan furniture. The warehouse is expanded to 30,000 square feet from its original 15,000-sq.-ft. footprint.
Mid-1980s - With six stores now, the other partners ask Jerry to run the corporate headquarters in St. Petersburg and oversee the retail operation while they concentrate on the manufacturing side in the Philippines. The Newtons buy out those other partners.
Late 1980s-1990s - Jerry's computer background helps the corporation grow in an automated manner. Linda's artistic talents contribute to the creative mix of domestic and imported products and aggressive marketing. Leader's develops three showrooms in central Florida and fills in other west coast Florida markets.
1990s - Tami joins the business. While attending college, she draws on her education and experience working with her parents in their retail store chain as she gains knowledge in various parts of the company. Leader's wins the industry's coveted Apollo Award, after being Top 10 several previous years.
1994 - Leader's Casual expands its warehouse again to 52,000 square feet in response to steady growth.
1998 - The Newtons draw from their experience sourcing for their casual furniture stores and Tami develops the wholesale division Palm Springs Rattan & Garden Classics.
2001 - Tim joins Leader's full-time, working in sales and store management and ultimately all aspects of the operation. The retail chain expands to Florida's east coast.
2003 - Ashley starts her career at Leader's working with Tami in Palm Springs Rattan and soon begins training with Linda to take over the purchasing and advertising departments.
2004-2006 - Leader's opens a store in Pompano Beach, its third on Florida's east coast, bringing the total number of stores to 16. Leader's also re-opened its Boca Raton showroom, which was destroyed in 2005 during Hurricane Wilma.
2007 - Leader's experiments with store sizes by adding a 16,000-sq.-ft. showroom and a smaller-than-average 4,200-sq.-ft. store on Florida's west coast in Port Charlotte and Spring Hill.
2008 - Leader's Holding Co. completes construction of a 50,000-sq.-ft. warehouse to supplement its existing, highly automated 100,000- sq.-ft. warehouse.
2012 - Leader's currently has 19 stores with average square footage of 6,500-7,000. The company operates an e-tail business and commercial and wholesale divisions. Overall, it employs about 170 people. A new showroom was opened last month in Clearwater to replace an older location. Leader's Casual Furniture continues setting new volume records.