The Speaker Cowboys of Harvard: BEATING The Brick & Mortar Bottom Line
ADVERTISING, INSURANCE, LABOR, RENT, UTILITIES…the list of overhead costs goes on and on. These overheads are what every business aims to keep as low as possible to drive profits, but as the all-encompassing name dictates they were unavoidable costs for most until e-commerce business became possible. Before the age of Amazon though, there were still ways for crafty entrepreneurs to avoid the high overhead costs that come with having a brick & mortar location….in the 1980’s!
For those of you who hadn’t graced planet earth with your presence yet, e-commerce did not become possible until 1991 when the internet was finally opened for commercial use. Since then, countless thousands of businesses have taken to the web to conduct business and avoid having locations with the lengthy list of overheads that come with them. However, even without the web at their disposal, a few entrepreneurially minded Harvard students still found a way to “beat” the overhead trap by selling brand-name speakers out of the next best thing at the time: A U-HAUL.
Even though there was a local stereo store down the street already, this innovative group of friends rented one truck, parked it behind their Harvard dorm, and literally just started whispering, “Psst…Hey! You wanna buy some speakers?” Once you look past the overall sketchiness of this encounter, you see something revolutionary:
NO rent & FREE marketing.
While the local electronics brick & mortar competitor spent plenty of money on advertising and real estate, the speaker cowboys on campus bought up last year’s brand-name stereo speakers at a great discount and sold out of their entire supply in no time.
The added psychological beauty of this concept is that the student customers actually thought they were getting a better deal since they weren’t buying from a store, making the convenient purchase all the more appealing even though the speakers were actually priced HIGHER than the brick & mortar alternative. Let’s not forget these are Harvard students. If Ivy Leaguers can fall for that sales tactic…the parking lot entrepreneurs had to be onto something.
This timeless Untold Business story just goes to show that the web is not the only realm of commerce to avoid the overhead trap of brick & mortar locations. With a little creativity, you can reach your target market directly without having the high costs of a physical location and increased margins to prove it!
April 27, 2018| By Chaz Hermanowski – Untold Business Writer