Do you have a new idea for a business, but are not sure what to do? In this series you will learn from the successful Jack Nadel how to research business ideas and how to know if a business opportunity is the right one to help you accomplish your goals.Sign Up to Watch
-Hey, this is Daniel McKenna, and today we are here with Clay Clark and Jack Nadel, a decorated World War II veteran and founder of Jack Nadel International, one of the top distributors of promotional merchandise in the United States.
Today we are talking about business startup methods which could be a game changer to your business, the Nadel method. In this series, Jack will teach specifically about his methods for successfully starting and growing a business. Time to learn from one of the best. Let's get right into it.
-All right, Jack. We are talking about probably the thing I'm most excited to interview you about. It is, in my mind, a super valuable tool. But it's a business startup method that you've come up with. It's a five-step method, called the Nadel method, and you developed this through six decades of in-the-trenches entrepreneurship. And so we're going to go ahead and dive into step one of your Nadel method for startup here is one, you say identify a business idea you love. Talk to me about that, my friend.
-Well, I think you have to start with something that you're going to be spending a great deal of time, and you're going to get a lot of excitement and hopefully a lot of pleasure out of it. It has to be something you really enjoy doing. So I-- the-- And not only enjoy it, but have a capacity for it. I enjoy negotiating. I really enjoy it.
CLAY CLARK: You do?
-I really-- It's a kick. I enjoy selling. It's a kick. I enjoy making a deal, because one of my basic principles is that your deal has to be good for everybody. So I think I'm doing a world of good. So picking something that you like.
And, as I have said before, the importance is the journey, as well as the destination. So if I'm working with something I enjoy working with, I don't care how much money I would make. I will never, and I have rejected, and I broke up a few relationships because of it, deal with anything that involves tobacco.
-You won't do it.
-Won't do it. Won't do it. Now, interestingly, this was something that could be done. I have nothing to do with that. That comes in front. So if I made a billion dollars on it, it would not give me the satisfaction.
-So you focus on, step one is identify a business idea you love. But you also, in your book, you talk about it, and again your book, "The Evolution of an Entrepreneur," you talk about really defining your goals, and you're saying know the difference between wishes and goals. Can you walk me through why that's so important to do that?
-Right. The wishes-- And you run into so many people, they're called Dreamers, the Dreamers. You want to accomplish something that is not within your mental or physical capability. And this is a mistake. You've got to recognize it.
For example, I love to play football, and I would have loved to have been a great passing quarterback, but my arm did not have it, and I could not be. So having a goal to be a great quarterback would be stupid. And having a wish to be a great quarterback would be believing in the tooth fairy.
So I've got to-- I've got to have my capability and my desires doable. And when it is doable, it becomes a goal.
-Well, you also talk about-- And again, this is all from this chapter of your book where you talk about this method. It's phenomenal. You talk about aiming high versus settling. Walk me through what you mean, because again, you're saying-- On one hand, you're saying, don't be delirious. Don't be crazy. Don't believe in the tooth fairy. But you're also encouraging us to aim high and not just settle. How does that work?
-Well, aiming high could mean a number of things.
For example, [INAUDIBLE]. Let's talk about the pen business, talk about a segment of the pen business. I was offered equipment at a huge discount that is used to manufacture stick pens. It's the cheapest pen.
-Stick pens, like BIC, or-- I did not want to get into that business. It's highly competitive. And you make one mistake, you're in bad trouble. Because you're dealing with a lot of money, but each item is small dollars.
-That's not where you wanted to be.
-That's not where I wanted to be. Where I wanted to be was in the segment of the marketplace where I could make a profit, so what I wanted to do is to be within the name brand category, although I didn't have the name, but I made the name.
Find the game changer for your business.
-And if not, I had different deal times. I had exclusive deals with Pater Mate, with Schafer, and with another company that's out of business now. But I had deals with them. And I was able to do more. I could be very proud of what I have. And I didn't have to worry if someone was taking an extra 10 minutes on their break that it was costing me a fortune.
So I never wanted to, for example, my tendency for me, I stayed away from any business that was a bid business. OK? Now, that becomes a wish, not a goal. Because if I really want to be competitive in the bid business-- and that's changed a lot of my specialty business now with the internet.
Because if you want anything-- you want a T-shirt, you put T-shirts in, you get a dozen quotes, or a hundred quotes-- and you pick the lowest quote. And that's it. And I'm not interested.
I had a call from one of the major oil companies. We have three people that we give all our business to, but they have to bid against each other. Well, one of them is in a place like Oklahoma. [LAUGHS] Rent was cheaper.
-What is that supposed to mean?
-If I'm going to be in the bid business, I can't be a Los Angeles or New York, which is a high priced labor.
-For anybody who's not been to Oklahoma, but they have been to Santa Barbara, just picture Santa Barbara, California and then something twice as awesome. And that's what Tulsa, Oklahoma is like. So this is where people get the wrong idea about Tulsa.
-OK. I'm glad you straightened me out.
-All right. Now, what I want to talk--
-But the point is that that's a business I don't want to be in.
-Right. I want to clarify this, because this is a huge thing. Because step one you're saying, identify business that you love. But then in step two, you're encouraging us to ask the right questions as you research. And so maybe one of those questions would be, is this a bid business? Or, what kind of questions should we ask?
-Well, the questions are never that direct or obvious because it's a bid business. But if you say, how many people do you have as customers who are continually supplying these millions of stick pens, that tells me the same thing. And who are the companies that are in this business?
Am I competing with Schafer or am I competing with Joe Blow? It's a different-- I've got to ask these questions. I've got to see what they're penetration in the marketplace was. I've got to ask questions of the customers and the potential customers, and all asking questions.
Have you used this product? How successful has it been? How have you used it?
How would you like to use it? How would it be a great product for you to use? What goals do I have to achieve to get you to buy a million of them?
-In your book, you encourage people. You say, if it's a good idea, someone has already probably thought about it first. Now, when you said that, at first when I read that I was going, well, that's not very encouraging. But it's true. You're saying, if it's a good idea, somebody's probably already thought about it.
-You've heard the old cliche. I'm not going to invent the wheel again, which is the oldest invention which is always in use is the wheel. If I have an idea that's going to work for somebody, and they come out-- gee, that's really a terrific idea-- then it has to be the height of ego to think that no one has ever thought of that idea before.
So what I want to do is to cross check and see if anybody has, and what success they've achieved, and where they are now in that business. So I have to find out. I have to find these answers. And today it is so easy. You just go to your search engine and bingo, you have it.
-Well, you said your book, you said, research what they did, how they did it, and how you can do it better. And this is one thing I think that people watching this, that the Thrivers watching this think you guys can get out of this, is you've been an entrepreneur for 67 years. And you look at it.
And you're like, it's never been easier. This is the best time in the history of the planet to be an entrepreneur. You're saying, this is so much easier. Back in the day, you had to go to the library. You had to physically travel places, whatever you had to do.
-It took me three weeks to get a sample to China.
-Now I get it there overnight.
-So, I mean, just do your research though. You're saying research what they did, how they did it and how you can do it better. And I think that's massive.
Now you also say though, some of the questions we should be asking are what products in the marketplace are similar? Who else in the marketplace is doing this successfully? How big is the market?
These are all big questions we should be asking. But you're saying that first is find something you love, and the second is start to ask those tough questions. Am I right?
-That's right. Exactly. Ask all the tough questions you can think of because it's going to be half of what your customers are going to ask you. Or half of what you have to prove. In your final accounting, did I make a profit on this?
-You've probably seen this before, but in the world of entrepreneurship, and in the world of formal education, I've found there's two camps. There's a group of people who are entrepreneurs, which, basically, are could be very busy unemployed people. You know, they're an entrepreneur but they're not actually running a business. They're just running around with ideas, the dreamers.
And in the world of formal education, there's people who might be on their ninth year of their fourth degree, and they're just, kind of, staying on campus there. But at the end of the day, if you're going to have success, you have to be a doer. You have to get into the details, you have to focus on actually delivering.
-I'm a total believer in doing it and experimenting with it.
-In other words, if I have an idea for a new product, I will make a handmade model of that product. I want it to look exactly what it is and I want to get some exact quotations on the quantities that I need to make it a profitable item. So it's a question of just getting into it, and examining it and asking the questions, and finding out how someone is blunted their pick with it before.
I had a guy who came to me through a connection seeking my advice. He had a new program that would work on the internet. Of course, there must be a million new programs, but he had a new program. And to me, as an amateur, it's sounded great.
It sounded great. So I looked at him, I said, you know, this is so simple. Has anybody done this before? He said no. That's the remarkable part of it, nobody's done it before.
After he left, I went to my computer and I found there are seven companies offering the same goods, the same services. Right? If you don't do the research, and you have to do it yourself because you're doing it with your discerning eye.
What am I looking for in this research? Am I looking for how difficult it is to make? Or am I looking at how difficult it is to sell? Or how difficult it is to convert it to a profitable item?
-Well, step three of your system and your method, as you say, plan a deal and focus on the details. Now the word detail's scary because that sounds like work.
-It is work and it's fun because that's all you have, some kind of fantasy deal you want to make. And I'll try to keep this in the mild zone, whatever that is.
The act of investigating it. The act of examining all the details. The act of producing a sample. The act of going out and selling it is all necessary for you then to have a price structure that one, is going to give you the sales. And two-- I should say one, really-- is going to give you the profit.
And this is what is needed.
-Also in your book, you say structure a deal and create a plan around it. What do you mean by that?
-Well, let's say I really like this special idea, that if I have, like, a television screen over my head, and I visualize that deal. And I visualize I did everything I wanted to do and it came out perfectly. And the price was right, and the goods were great, and everything was great.
I ask myself one question, how do I feel about it? And if I don't feel good about it, I don't go into it.
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