Progressive Rentals November-December 2003
 Art in RTO by by Stephen Schenck
A Plan for APRO’s Future by Ed Winn III
Partners in the BestWay: An APROfile of Jeff Loeb and Richard Rose by Kristen Card
The Autobiography of a Rent-to-Own Dealer by Ed Winn III
ART INTO RTO
For those outside the RTO industry, the relationship between art and RTO is not an obvious one. Ask an average American to give his or her impression of a typical RTO store and you might hear a description of the industry as it existed 20 years ago—stores with tile floors and bare walls, filled with furniture and appliances “priced to move.” C Today, that description is especially outdated because over the past decade, many RTO owners have abandoned the old school of store design and embraced current trends by putting fine art on their walls and in the homes of RTO customers. C “Back then, RTO was strictly a meat and potatoes business,” says Mark Peterson, owner of four H&H Furniture stores near Yakima,WA.
Peterson, who converted his family-owned retail stores to RTO in the mid-1980s, says he immediately understood the importance of art to RTO. His stores, as evidenced by the 2003 RAE Award for store display, have been at the forefront of store design and the RTO art market.
“We came at RTO from a retail and furniture perspective, where art was already big business,” Peterson says. “The reality is that you need art to distinguish your stores. I use art with displays to create a mood for customers and paint a picture for their home.”
To make that distinction and capture just the right mood for his customers, Peterson orders art from a few of the art suppliers that have popped up to serve the industry, two of which are Next Dimension Studios and RTO/Arts.
Next Dimension Studios in Erlanger, KY, is the largest of the three main art suppliers for the rent-to-own market and has served RTO since 1995. Before that, its president, Eric Moore, had served as president of Laurel Street Art Club, a company that also supplied art to both the retail and RTO industries. “At the time, there was no real wall art program in the industry. We felt the RTO market was perfect for our products,” says Moore.
It was the same market that also convinced Will Yankus and Fritz Rollins to start up RTO/Arts, a subsidiary of Cannonball Fine Arts, in April 2003.“We saw that RTO was a rapidly growing industry that was getting more and more mainstream,” says Yankus. At the time, Cannonball had 30 years of experience supplying art to retail chains such as Williams Sonoma and Pottery Barn, but it had yet to reach out to rent-to-own.
That all changed, however, when RTO/Arts President Rollins began to recognize the potential of the RTO industry and became very active in APRO, even representing the California state rental dealer association at its legislative conference in May.
“Before, art was treated more like a decoration in the store,” Rollins says. “You could tell customers that they could rent the art for their home, but more than likely they didn’t even know it was for rent. RTO/Arts wanted to give rent-to-own customers a complete vision for their home.”
Another supplier that has been rapidly entering the rent-to-own market is Mirror Dynamics, based in Newark, NJ. Mirror Dynamics began supplying the RTO industry in the mid-1990s, but Abraham Kalina (now deceased) established the business in the 1970s, supplying bar mirrors exclusively for the liquor industry. After suffering a stroke in 1993, he couldn’t keep the business afloat and ended up losing many of his previous customers. So when he returned to the business, he knew he would need to find a new market. According to his son Daniel, they began a furniture line for retail outlets. A few years later, they discovered the RTO industry and never looked back.
“I had no idea the industry even existed, now I’m pretty much an expert on RTO,” says Daniel Kalina. “It’s a fantastic, very lucrative business. If I didn’t have this mirror business, I’d be in RTO. It’s just a genius idea that keeps customers coming back. RTO brings products to people they normally couldn’t afford. It says, ‘If you want it, I can give it to you.’Who else can do that?”
The real picture
With so many fine art dealers flocking to RTO, has it been transformed into a hip, chic art gallery for the masses? Well, not exactly. Televisions and couches are still the meat and potatoes of the customer’s RTO diet. In fact, at around 2 percent, art rentals and sales are still a small part of the industry’s overall BOR.
The experience of Chad Peterson (unrelated to Mark) of USA Rental in Biloxi, MS, is probably typical of the industry as a whole. Peterson’s father, Neal, opened the store just over 10 years ago in February of 1993. Peterson joined the family business in 2000.
“I’m not sure if I’m the best person to talk to about art because art really isn’t a major part of my business,” says Peterson. “Initially, we brought in art simply to dress up the walls. However, since we started using art in our stores, profits have gone up because when customers rent the bedroom set, they say ‘Let me rent the picture, too.’”
Back at Next Dimension Studios in California, Eric Moore is the first to admit that art will never rent enough to carry a store on its own, but he says it can make the difference between a store struggling to break even and a profitable one.
“Look, no one ever walks into an RTO store specifically for wall art,” says Moore. “It just doesn’t happen. Art in RTO is like a candy bar in a grocery store. Grocery stores sell more candy bars than anywhere else, but nobody goes into a grocery store just for a candy bar. Instead, stores place them at eye level and it’s an impulse buy.”
Daniel Kalina was equally realistic about art and RTO. “Who walks into a furniture store and rents art? Nobody. RTO is a good start though because art can make any room complete. When you add art, you add life—you add a touch of yourself,” says Kalina. “A bed is a bed, a TV is a TV, but with art the customer can say, ‘This is me.’”
What rents?
If increasing profits really is as easy as hanging a few pictures on the wall, then what kind of artwork should RTO owners keep in their stores? The answer, of course, lies in customer demographics— what doesn’t rent in one store might be a best seller in another.
The demographics ofMark Peterson’s four stores in the Yakima, WA, area, for instance, could not be more different from one another. One store serves the more urban Yakima market, one the rural mountain country, another serves mostly Hispanic customers and the last is located on a Native American Indian reservation.As you might expect, the difference in taste is huge.
“I suppose, in general, the larger pictures sell better because they fill up the wall. Many of our male customers, no matter what their background, seem to have the same ideas about decorating their home—just slap a big picture up on the wall to fill up the space,” says Peterson says, jokingly. Other than size, however, he says there are few similarities in taste and he doesn’t see any specific trends as far as what rents and what doesn’t. Instead, he believes success lies in knowing and serving your specific customer base.
“You know, people don’t want seascapes if they live in the desert. The most important key to success, that I think will continue to improve, is the way manufacturers have segmented and narrowed each individual market to make it more ethnically and culturally focused.”
Maintaining success and customer satisfaction
In order to meet the varied needs of various groups of RTO customers, all of the industry art suppliers are prepared to help owners select the best artwork for their respective stores. At RTO/Arts’ Web site (www.rtoarts.com), clients can browse a product line that includes more than 800 images in a variety of styles ranging from landscape and still life, to abstract and impressionist.
In addition to its extensive catalog of framed and matted lithograph prints, RTO/Arts also offers original artwork from 14 countries around the world. Carrying such a rich and diverse line of art, according to Rollins, is absolutely crucial in order to succeed in the art business.
“Artwork is like music, everyone has different tastes,” says Rollins, “so we have to provide a wide range of art to satisfy those various tastes. Also, art is constantly changing styles and trends, like music, and it is our job to keep up with it all.”
Much like RTO/Arts and Next Dimension Studios, Mirror Dynamics offers paintings, lithographs and silk screens, while also expanding the market by offering a unique line of mirrors. “We have a unique process where we silver the glass then remove some of the silver and silk screen over the space to create images on top of the mirror,” says Daniel Kalina.
Although many RTO store owners see market segmentation as the main trend in the industry concerning art, Paul Davis, owner of two Nations RTO stores in California, believes that philosophy wouldn’t work with his customers. Unlike some other RTO stores that seem to serve specific cultural groups, Davis says his customers represent all walks of life and ethnicities.
“I do think what you rent depends on where you live. There are some stores that may serve just one group, but in California the population is so diverse, you have to appeal to every group. Personal taste is so fickle that you have to appeal to everyone. For example, I have African-American customers who buy Italian art and Italians who buy African-American art. I have to carry a wide range,” says Davis.
Convincing customers to rent art, Davis says, involves the same simple strategy the RTO industry has utilized since its inception—give customers what they want. For Nations RTO, this means keeping up with current fashions and allowing repeat customers the ability to request specific pieces of art.
“I started from day one knowing that people like to mimic what they see on television, so from time to time I’ll watch some of the shows for ideas,” says Davis. “They want familiarity and to feel at home, so I try to create that hominess in my store and it keeps my long-term customers coming back.”
As for the future of art in the RTO industry, most believe it is here to stay and will only grow as more and more owners search for better ways to increase profits. “There will always be stores that survive and succeed without any focus on art,” says Eric Moore of Next Dimension Studios. “But as the market becomes increasingly competitive, more stores will recognize the advantage and dramatic improvement that art can bring.”
Will Yankus at RTO/Arts agrees and believes art can create an “across the board” improvement in rentals in a store.“Now, in 2003, were seeing the art market help the industry increase and create profit margin. It’s not art rentals alone that impact profits, but also the way artwork can create a mood for the customer and lead to other rentals throughout the store.”
Stephen Schenck is a free-lance writer.
APRO's FUTURE
The very first seminar ever hosted by the Association of Progressive Rental Organizations was held back in 1981. The seminar was hosted by Chuck Sims, then owner of Remco, who led a two-day event entitled, “Planning, the Process of Control.” Sims considered it to be of overriding importance to the success of rental companies that rental dealers learn how to do strategic planning. Actually, he conducted that same seminar three times in quick succession, in Carmel, CA, Dallas and Atlanta in an effort to get this important message out to as many dealers as possible in those early days. The message of the importance of strategic planning was as vital then as it is today.
There was certain symmetry then, in the affairs of the Association when the APRO board of directors met in October in Aspen, CO—at each board member’s own expense—for a three-day strategic planning session with Sims acting as the facilitator. Sims graciously donated his time to the effort because of the importance of the work.
The purpose of the meeting was nothing less audacious than to plot the future of the Association over the next three to five years. Association leaders have long recognized the need to do strategic planning for the Association and have held sessions in 1989, 1993, 1998 and, now, most recently, this fall.The results of the previous planning meetings were not widely publicized and should have been. This board wants the membership to know that the board has been planning and what the results of those plans are.
A number of the current board members had never been through a formal strategic planning session with an outside facilitator, either with APRO or in their own companies, and so the process was new for them. The board spent roughly 20 hours together over two and a half days, coming up with the new strategic plan for APRO—and this does not include the time since spent in committees drafting action plans. Importantly, the board was not planning for the industry or for some idealized rental company. Board members made a plan for the trade association and reached important conclusions about the continued vitality and future growth of this 22-year-old organization.
On the last day of planning, the APRO staff attended during various planning discussions, since the staff will be primarily responsible for executing many aspects of the plan. It is important that staff members be personally invested in the plan details instead of having the plan handed down to them from on high.
While previous plans were not kept secret, they were not communicated effectively to the APRO general membership. Since it is the membership to whom the Association is ultimately beholden, this group of planners decided to do a better job of getting the membership involved with the plan than has been the case previously.
ACCESSING THE PRESENT
The goal of strategic planning is to shape the future of an organization through an orderly process. Overall, the process assesses where the organization is today, in terms of its mission, where it wants to go in the next few years and how it plans to get there. At the meeting, Sims stressed that effective strategic planning requires more than one meeting during which the plan is created. It requires follow-up assessments and refinements at least quarterly and then every year the planning begins anew, pushing the plan out another year.
To determine where APRO is today, the board examined the world in which it exists from economic, political, technological and social points of view. The dealers examined the competition and the products that the Association offers its members as well as the markets that it is in. Board members assessed the key performance factors for success as a trade association and the strengths and weaknesses of APRO as it exists today. As part of the analysis of where the Association is today, the board reviewed the strategic plan developed in 1998 and measured how well that plan had been implemented over the past five years.
As part of the internal analysis of the Association, the board examined the organizational structure of APRO, the management style within the Association and the relationship between the board of directors and management and staff.An important aspect of the internal analysis was to identify the major problems facing the Association. Once those major problems had been identified and refined, the board identified the major opportunities that exist for the Association.
PLOTTING THE FUTURE
Discussions were candid and spirited thanks in no small part to the open atmosphere that Sims created as facilitator. The APRO board is diverse and a lot of points of view were expressed in the room. It is the task of the planning facilitator to create an environment where participants are free to speak their minds. Initial thoughts on a topic are uncensored and all comments are welcomed. As the discussion progresses, the ideas are distilled by the group as the facilitator listens for and focuses the group on areas of common assent. Sometimes there is quick agreement about what is important or which ideas are better or more reasonable. Sometimes, there is no agreement.
Once the group had thoroughly conducted an external and internal analysis of where the Association is today, it began to look at where it wants to go during the next three years. The board reviewed the current Mission Statement to see if it would still fit in three years. After some discussion, the board modified the APRO’s Mission Statement, which now reads:
“APRO is committed to being the national rental-purchase trade association by providing valuable member benefits, maintaining a benevolent business climate, and promoting professionalism in the industry with responsibility and integrity.”
When assessing where the Association is today, the group sought objective data about the Association and, secondarily, the industry. When deciding where to go with APRO, the board left the comfortable world of facts and analysis and had to start making choices among a potentially infinite selection. Deciding where to go was harder thinking than analyzing tech where it is. Figuring out how to get there required harder thinking still.
APRO’S STRATEGIC OBJECTIVES
The end result of strategic planning is a series of strategic objectives coupled with action plans that are to be implemented to achieve the objectives. The APRO board developed a dozen specific objectives to be achieved by the end of 2006. They are:
- Increase the member attendance at the annual convention/meeting to 800 attendees; increase the number of vendor companies at the show to 160; increase the number of booths sold to 300 by achieving increases in member attendance to 600 in 2004, 700 in 2005 and 800 in 2006.
- Secure the enactment of satisfactory federal legislation before the current Congress adjourns.
- Increase the number of member companies in the Association by a total of 25 net members for each of the years, 2004, 2005 and 2006.
- Reduce the member dropout rate other than through acquisitions or leaving the industry altogether to 9 percent in 2004, 7 percent in 2005 and 5 percent in 2006.
- Develop a weekly Internet newsletter publication that is sent to 6,000 e-mail addresses in 2004, 12,000 e-mail addresses in 2005 and 18,000 e-mail addresses in 2006.
- Increase the number of Associationsponsored training courses on the Internet by two in 2004, another two in 2005 and by another course in 2006 for a total of 10 courses with 4,000 student users in 2004, 8,000 student users in 2005 and 10,000 student users in 2006.
- Produce $50,000 in advertising revenues from the Internet publications in 2004, $75,000 in 2005 and $100,000 in 2006.
- Develop and test an e-mail server service for the Association by June 2004 and introduce the service at the 2004 Convention.
- Develop a baseline of member satisfaction in 2004 and increase the level of member satisfaction to 90 percent by 2006. For the baseline analysis, ask the current members whether they are getting their money’s worth from their APRO membership.
- Increase the number of active state associations from the current 23 to 40 and create six to eight regions for hosting educational seminars and vendor expositions by the end of 2006.
- Increase the attendance at the Mid-Year Conference by 20 per year for each of the next three years.
- Develop the APRO brand that is featured in all member stores and is available for use in advertising by the end of 2006. Once the strategic objectives have been developed, the next phase in strategic planning is to write action plans for each objective. Action plans have individual steps necessary to achieve the objective. Each step must have a responsible party, a start date, a completion date, a cost estimate and sufficient detail in the step so that it can be measured and checked off once it is completed.
Due to the depth of the analysis during the planning session, the board did not have time in Aspen to write action plans for each of these strategic objectives. Since the meeting in Aspen, various Association committees have met to draft action plans. As of this writing, one set of action plans remains to be written. Staff and board members have already started working on a number of action plans. Several steps have already been completed. Others are well underway.
While each aspect of the plan has a responsible party, there is a lot of work to be done. If any member readers of this article see a project of particular interest or one that could benefit from the members’ talents or resources, they are invited to volunteer by calling the APRO office for more information at 800/204- 2776. The APRO board and staff are looking for increased member participation in the life of the Association. This is an excellent opportunity to get involved.
Once all of the action plans have been competed, copies of the full 2003 strategic plan will be made available to APRO members upon request.
Ed Winn III is APRO’s general counsel. His e-mail address is edwinn@ e-bylaw.com.
Partners In the Best Way
Teamwork is the fuel that allows common people to attain uncommon results. Nobody knows who first said it, but chances are, he had a partner. Partnership was the element that proved to be a career catalyst for Richard Rose and Jeff Loeb. Each was traveling a moderately successful professional path on his own— Rose as an appliance, electronics and furniture retailer and Loeb as a corporate controller. They didn’t hit their strides until a mutual colleague and friend brought them together and directed them toward the rentalpurchase industry.
The link between the two of us was Ed Jaffee,”Rose begins the story of his longtime partnership with Loeb. “Ed grew up down the street from me. Then, as adults, we played golf together. Eventually I joined him in his appliance and electronics business. About a year later, he was presented with a new rentto- own opportunity and wanted me to go with him. Jeff was at Circuit City at the time and Ed asked him in, too. He thought the two of us would be a good combination to develop and manage a business like this.”
Jaffee, who has since passed away, was right on target. Rose and Loeb teamed up to create Best-Way Rentto- Own (www.rtobestway.com), as CEO/president and CFO/treasurer-secretary, respectively. Next spring, they’ll celebrate the Virginia-based company’s 20th anniversary.
“We put the business together in Jeff ’s backyard, at a picnic table with a piece of paper and a pencil,” says Rose. “A pencil with an eraser,” says Loeb, chuckling. “Right.With an eraser,” says Rose.
Mistakes are an unavoidable part of building a business, but it doesn’t seem Loeb and Rose have made too many of them. They opened their first store (then called Rent-to-Own Home Center) in Norfolk, VA, in 1984. Today, the pair has 50/50 ownership of 17 thriving locations and a plan to almost double that number of stores within the next five years. Clearly, their partnership of complements is working.
“Even though we, of course, started with one, we always had the mentality we’d have a lot of stores,” says Rose. “Ed’s big-company background was instrumental in how we set things up and Jeff had enormous experience in the financial side of the business. Because of my background in retailing and merchandising, my forte is operations—advertising, merchandising and sales.”
Richard Rose is the twosome’s convivial, mannerly Virginian. Reared in Richmond and a graduate of the University of Richmond, Rose’s first post-college position was in the trust department ofWachovia Bank.He left banking for furniture retailing, originally as a store manager and then as owner of a three-store Richmond-based operation.When his friend Ed Jaffee retired from Circuit City to open up his own electronics and appliance company in the state’s southeast, or Tidewater, region, he persuaded Rose to open and manage a similar operation in Richmond. That’s where Rose was when Jaffee introduced him to Loeb and the rental-purchase industry.
An un-stereotypically reserved native New Yorker, Jeff Loeb was born and raised on Long Island. Following his graduation from Penn State University, Loeb spent 10 years working for Ernst & Young (then Ernst & Ernst) before becoming a corporate controller— first for a New York client, then for Circuit City in Richmond,VA. It was there that he worked with and got to know Ed Jaffee, his eventual connection to Rose.
Partway through our conversation, Rose pauses. “Jeff ’s not saying much.”
Loeb instantly protests. “No, you just talk. That’s fine. That’s the way it’s always been.”
“I do the talking and he makes the corrections,” says Rose. “I’m a sales guy; he’s a detail guy. Counts every bean.And if they’re not all the same size, then he wants to know why.”
The long-term success of Best-Way Rent-to-Own is largely attributable to the right combinations. Rose and Loeb’s partnership was the right one to begin and run the company and through the right blend of internal financing and careful acquisition, they’ve grown it into 14 Virginia stores and three North Carolina locations. According to the duo, they’ve also developed the right recipe of business philosophies for ultimately producing profits.
“First and foremost, we’ve always preached and practiced customer friendliness,” says Rose. “It’s a written policy for us. You make sure the customer is taken care of properly, even if it costs us—I don’t care. Businesses are built by customer relationships.
“Secondly, we take care of our people,” says Rose. “We’ve been extremely fortunate to have a lot of wonderful people working with us, for us. Many of our employees have been with us for 15 or 20 years—practically our whole existence. They’ve chosen to cast their fortunes with us. I think they’re happy they have.
“For example, all our stores had to close for a couple of days during Hurricane Isabel this past September, but our employees got paid anyway. We treat our employees well and they treat our customers well.” Rose also credits strong vendor relations, strategic locations and relentless advertising with Best-Way’s longevity.
“We’re always advertising all the time in various media. I’ve seen different competitors back off of advertising whenever times got tough and budgets got tight.We never have,” says Rose.
“In fact, we tend to spend more money on advertising in tough times,” says Loeb.
Rose sums up, “We want to be the first-est with the most-est.”
For Loeb and Rose, teamwork has been an essential, everyday part of their professional lives—not only their own collaboration, but also their interaction with other members of the rent-to-own industry.
“We’ve befriended other RTO dealers around the country,” says Rose. “In Florida, Mississippi, Missouri, North Carolina, Ohio, Texas,Washington state.And we regularly talk with each other about common problems.
The openness we’ve found in this industry is just incredible.”
“Incredible!” says Loeb.
“Incredible,” says Rose. “It’s been important for us and has served us all very, very well. It makes business life easier, simple and more successful. At the national level, APRO and TRIB [The Rental Industry Buying] Group have helped us a great deal with all kinds of things. They’re helping make our business bigger, better and more profitable.”
Loeb and Rose have been APRO members as long as Best-Way’s been around. Their involvement in the organization began when Loeb went to his first APRO convention in Orlando in 1984 and came home more than a little impressed.
“I went to that convention not knowing what to expect,” says Loeb. “The level of cooperation between competitors from across the country just blew me away. They were wide open with each other. This year, I’ve just completed 20 years of APRO conventions and wouldn’t miss it for the world.”
The pair’s involvement in APRO activities has been steady, but subtle. Last spring, they went to Washington, D.C.—just a hop, skip and a jump from their headquarters— for APRO’s annual legislative conference and talked with legislators for the first time. Now, they plan to participate in the program every spring.
“I’ve been in other business organizations,” says Rose. “APRO is very well-run, very well-organized and meets the needs of its members—because the members are the organization. The rental dealers actively participate and, thanks to that, the organization enables our business to flourish in many ways via education, training and legislation.”
Loeb agrees. “They’re just excellent people doing an excellent job.”
At the state level, Loeb serves as president of the Virginia Rental Dealers Association, a group that’s been basically dormant since it helped pass Virginia’s RTO statute—which became the model for state legislation nationwide—way back in 1987. Loeb says the Virginia law has proven satisfactory for all stakeholders, so there simply hasn’t been an active legislative issue for the group to rally around since its passage.
Beyond making sure their partnership continues to help Best-Way Rent-to-Own profit and progress, Rose and Loeb want their firm to be a dependable community partner. They contribute to a broad spectrum of Tidewater-area charities and civic organizations, from churches to schools to police officers and firefighters.
“We do our share because it’s important to support the causes you think are good for our society, whether you have a business or not,” says Rose.
One of the twosome’s favorite charities is a locally based organization called “An Achievable Dream” (www.achievabledream.com), a character development- based education program intended especially for disadvantaged kids. Virginia women’s clothing retailer Walter Segaloff sold his stores to launch the program just over a decade ago.
“What’s important about what they do at the Achievable Dream school is teach the values so often missing in the society of impoverished children—kids who don’t have the mentors or even the parents to teach those things to them,” says Rose. “We’re contributing to that organization and have recommended to APRO to get involved in it, too.”
“And who knows?” says Loeb, “The children who may be helped by us today may be our employees down the road.”
If “down the road” looks anything like the road traveled since their paths crossed 20 years ago, then Loeb and Rose have little to worry about. Their splitdown- the-middle, words-and-numbers partnership has built a booming business. They are also busily grooming the next generation of RTO industry success stories. While Loeb’s two sons have gone their own ways, Rose’s son Ron is the company’s buyer of appliances, electronics and furniture, while son Jonathan serves as COO and third-in-command of the firm.
As they consider which words of wisdom to pass along to up-and-comers, the duo reflects upon insightful gems given to them along their journey: Follow the Golden Rule. Always be ready for opportunity. Prepare for the worst and anything better will be O.K. for you. And one more piece of advice, perhaps the most important nugget of all:
“A long time ago, when I was trying to gather enough money to start up a business,” says Rose, “I was borrowing from an uncle of mine who was rather wealthy. He said, ‘Be careful who you choose as your partner.’” Rose and Loeb both break out into riotous laughter, a sure sign of counsel well-heeded.
Kristen Card is an independent business writer in Austin, TX.
The Autobiography of a Rent-to-Own Dealer
By Ed Winn III
"I CAN IMAGINE THE BANKER'S LINE OF THINKING: 'Let's see now…You're asking me to loan $4,000 on a widow's house so her son can go start a business renting TV sets? Mrs. Devlin,' he said, 'I just can’t make this loan…' " "Sir," she said, "Nobody in our family has ever been successful. Tom has a good idea for a business and is a hard worker… Now, you either loan him the $4,000," she said, her voice rising, "Or I will go to another bank."
It is Tom Devlin's story, Playing Through: An Entrepreneurial Success Story, recently published by the Wichita State University Center for Entrepreneurship. The book was coauthored by Scott Dalrymple and Randy Scholfield. It is the story of how he started Rent-A-Center and grew it into the largest chain of rental stores in the country. He tells his story in an amiable, folksy manner, without pretension and with much charm. He readily confesses, early on, that he was not a good student, but he took life’s lessons in hand quickly and forged a rental empire in the 1970s and 1980s that was unrivaled then as it is today. He tells of how he first learned the business working for Ernie Talley, who respected Devlin’s talents and ambitions and paid him well. Destiny, however, pushed Devlin out on his own with the borrowed $4,000, which he turned into a $200 million enterprise.
Devlin tells readers about how the rental business was in those early days and how he developed innovations to separate his Sight and Sound stores, which later became Rent-A-Center stores, from everybody else. His was the first rent-to-own chain to go public in 1983. Before that, according to Devlin, Rent-A-Center was the first company to advertise competitive pricing for name-brand merchandise, much to the consternation of his competitors who did not advertise prices at all. Devlin tells how he was one of the first rental dealers to secure bank financing instead of having to borrow from finance companies in what was considered a very risky business in the 1970s. Rent-A-Center was also one of the first companies to start buying directly from manufacturers instead of through distributors.
Devlin’s book, with the subtitle, “How I Built a Company, Managed Runaway Growth and Learned the True Meaning of Success,” chronicles his life from early childhood to the present. For the most part, though, it is the story of Rent-A-Center and how he grew the company from one store in 1973 to 550 stores in 1987 when he sold the company to Thorn EMI for $600 million or 34 times monthly revenues.
No one has matched that record of growth or that kind of sales multiple and no one is likely to match it. It is, therefore, fitting that the first rental dealer autobiography be from Devlin. It makes for a great read, especially for fellow rental dealers. The book does not end in 1987 with the sale of Rent-A-Center as Devlin tells how he has gone on to pursue a number of other endeavors including real estate, restaurants, car dealerships and golf course development. The meat of the book, however, is about rent-to-own and how Devlin was able to distance his company from the competition so effectively at a time when the market was literally wide open.
Peppered throughout the story of Devlin and Rent- A-Center are 16 “Bottom Line Lessons in Business,” street-wise truths about business, generally, that Devlin learned both the hard way and the easy way and which he shares with his readers. For example, in a section on “Competition,” Devlin advises, in part:
“If you spend all of your time worrying about what the competition is doing, you are going to be a follower.My philosophy is to make the competition worry about me. I do that by making sure that our company is the market leader. My constant goal in business has been to figure what the market wants. There is always a need out there and a price needed for delivery [of that need]. Give the customer what he wants and do it with better prices and better service than anybody else. Do that and your profit will take care of itself.”
With so much written about the rental business by industry critics, it is refreshing to have a thoughtful, entertaining book written by one of the industry’s own; a book that shines a bright, happy, cheerful light on the business. Devlin is justifiably proud of the role he played in the development of the rent-to-own concept in the early days and of the successes of Rent-A-Center under his leadership. Devlin’s pride in his accomplishments is visible through on every page. Readers of this autobiography will not get a business plan for a successful rental company. They will get a candid, indepth picture of the man who built one of the most successful rental companies ever.
There are not many books about rent-to-own out there. Here is one that is all about rent-to-own told from a very personal point of view and it is a good one. Rental dealers cannot all achieve what Devlin has achieved, but rental dealers can all read his story, applaud his accomplishments, and, after the reading, feel more confident about the hopes and dreams they have for their own businesses.
Copies of the book can be purchased for $19.95 by contacting the Wichita State University Center for Entrepreneurship at 316/978-3000.
Ed Winn III is APRO’s general counsel.
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