Lumbering To Success

An Oak-Kay Idea

The idea didn't seem like a natural moneymaker-for a teenager des-perate for some summer spending money, maybe, but not an adult looking to build a successful enterprise. At least, it didn't seem like a good idea to anyone else, not even the truck drivers he bought wood from: "I could tell that they thought I was crazy," muses Sullivan.

His family seemed to agree with the truckers. Sullivan is the oldest of 11 children, and the only one of them to become an entrepreneur. None of his siblings made fun of him when he started his new company, but Sullivan admits, "they probably just thought it was one more crazy thing I was starting."
Not that you could've blamed any of them. Sullivan had struggled financially for years as he attempted to carve out a niche for himself somewhere in the business world. And it certainly took a long time for a niche to make him rich. At one point, he was renting a building to a woman with a dog-grooming shop . . . and sleeping in the back room. "I would actually go into the [shop] in the mornings and take a shower in the bathtub that she would wash the dogs in," recalls Sullivan.

Sullivan had always been talented when it came to opening the doors of new companies. It was keeping them open that was the hard part. "I really like starting things and getting them going," says Sullivan, who got Lumber Liquidators off to a banner beginning.

For his grand opening, Sullivan bought up lots of seemingly useless lumber, stored it in a warehouse and had a Friday-through-Sunday sale. "At 7 o'clock in the morning on Friday, there were probably 10 cars in the parking lot," says Sullivan, with more than a hint of a Boston accent. "The [neighbor businesses] were furious with me. All these people were driving around in their station wagons, trying to find out where this wood was being sold."

Never mind. Lumber Liquidators was a hit. It made $20,000 in its first week. "This is a lot better than contracting," thought Sullivan, who immediately started phasing out his construction company in favor of the new wood-selling venture.

But it wasn't easy. Sullivan had to find huge quantities of unwanted wood, and, while it was cheaper than the brand-new stuff, it wasn't cheap. Often, he was spending more than $1,000 on an enormous load of lumber, buying it from a factory with dozens of such wood piles. But Sullivan, who recalls he rarely had more than $5,000 in his checking account in those days, could never afford to buy all the lumber at once. So Sullivan would pay for a pile and ask the factory owner to keep the old wood around until he could sell the first load and have enough money to buy the second. It was a seemingly endless cycle.

He couldn't afford to hire an ad agency, so he created handwritten ads, which actually "stood out in the paper," he says, and were more effective than what he'd paid big agencies for when he was losing that $400,000 way back when. "I kept everything at a bare minimum. I didn't have much choice, because I had bare money," says Sullivan, chuckling.

Then there were those harrying times a customer would ask to purchase an entire trailer-full of wood from Sullivan, who then had to arrange to have it delivered. "I'd have to pay the driver when he got there. So I would go meet the driver, give him a check, then get the customer's check and run to the bank and deposit that so I'd be covered," says Sullivan, who doesn't remember any of the checks ever bouncing. "It was always pretty close, but it worked."

Sullivan stayed busy. During that first year, he worked 12-hour and longer days, 363 days out of the year, only taking holidays on Thanksgiving and Christmas.

Geoff Williams has written for numerous publications, including Entrepreneur, Consumer Reports, LIFE and Entertainment Weekly. He also is the author of Living Well with Bad Credit.

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This article was originally published in the September 2000 print edition of Entrepreneur with the headline: Lumbering To Success.

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