Cap Hendrix: President and CEO, Tropitone
Predicts industry core will emerge stronger
By Kristine Ellis -- Casual Living, 4/1/2009 12:00:00 AM
While a change at the top on the cusp of a recession might indicate a change in strategy for some companies, Cap Hendrix’s move to president and CEO of Tropitone last summer was anything but.
Hendrix had full confidence Tropitone’s business model was its best asset in the face of hard times. He had, after all, spent 10 years helping to define and implement it.
“In this kind of economy, the key is to be nimble and responsive,” Hendrix said. “If you take the value chain as your model and build up competencies within it and establish personal relationships with suppliers, dealers and reps, then you are going to have a much better chance of being able to be responsive to changing conditions. And that’s what we’ve done.” He added Tropitone is stronger now than ever before.
The value chain is the series of interconnected economic activities from raw materials to the end user, as defined by Michael Porter in Competitive Advantage: Creating and Sustaining Superior Performance. By managing those activities to ensure that everyone along the chain receives value from the interaction, everyone is working together on aligned goals thereby creating a competitive advantage for the organization.
For Hendrix, who served on Tropitone’s board of directors from 1998 to 2007 when the company was acquired by Pfingsten Partners, the business model manifests a leadership lesson Hendrix says he learned long ago from long-time friend Charlie Farrell, a former Tropitone president and CEO.
“More than anything else, [Charlie taught me] that people do business with people,” Hendrix said. “Leaders have to communicate to the people they deal with — whether suppliers, distribution partners, dealers or employees — that they fundamentally care about them and their well-being. If you can communicate that, you have a willing partner in developing a good business model and aligning around the value chain.”
Hendrix credits Farrell with guiding him from consumer goods to durable goods, which he finds much more interesting.
Hendrix started his career at PepsiCo’s Frito-Lay division, where he held several positions. He quickly learned what everyone who works at a Top 50 company learns.
“Everyone you are working with is smart, so it is a given that everyone has great conceptual skills,” he said. “The difference in success and failure then is execution, execution, execution.”
Although thankful for the experience he gained, Hendrix eventually got tired of the big business politics and bored with the work. As he puts it, there are only so many flavors of chips one can get excited about.
He finds durable goods, outdoor furniture in particular, far more interesting.
“Casual furniture is even more complex than most durables because it is fashion driven, so fast moving,” Hendrix said. “You have to deal with the weather, so you only have a short window when you can sell to consumers. As we are now finding out, it is certainly a cyclical product. It is very personally rewarding when you solve all of the complexities.”
Hendrix has no doubt Tropitone and the industry in general will emerge from the current recession better than ever. What’s more, there will be good opportunities for dealers, suppliers and manufacturers alike.
“Those who have taken opportunistic advantage of the market are going to look at this and say, 'Hey this is too hard now,’ and move on to take advantage of some other market,” Hendrix said. “That’s when companies like ours, and others that helped build this industry, are going to get strong — because we aren’t going anywhere. This is our industry, we built it and we’re sticking with it.”
In the meantime, Hendrix advises specialty retailers to push the message that, especially now, customers need the positive lifestyle that a comfortably furnished outdoor space can offer. Part of that comes down to celebrating what they are offering and having fun doing it, a common theme for Hendrix.
“I think our industry is way too serious,” he said. Hendrix thinks much of what he calls the seriousness of the industry is distribution driven.
“When you are bringing in container loads of product, you can’t take any fashion risks,” he said, adding when everyone buys “safe,” there is a degree of sameness on showroom floors.
Given that many specialty retailers are more cautious about filling their warehouses with product this season, Hendrix hopes they will turn more to domestic suppliers and dial up the fun factor in terms of colors and fabrics.
In general, Hendrix is optimistic about the coming season, believing many consumers have taken the corrective action they believe is necessary to feel more comfortable about their finances and so will become more comfortable spending going forward.
“As tough as it is, these kinds of conditions tend to cleanse industries, and I think it will do the same thing with our industry,” Hendrix said. “The core of our industry will end up even stronger as we emerge from this.”