8
Do values really sell?

Throughout this book we have cited companies and individuals that have found ways to build sales or create effective distribution strategies while maintaining their core values and socially responsible missions. Some of these companies have proven financial track records and years of experience or have sold for many millions of dollars. Others are newer to the world of business and are striving each year to reach their financial goals.

We believe that creating a business built on a foundation of values can not only increase sales in the short term but also build long-term benefits. This is a premise that many people, especially those reading a book like this, would heartily embrace. However, certainly some in the business world might argue that such an idea is purely idealistic.

As we started working on this book, Angela discussed the subject of social responsibility (and what was involved in creating the contents for this project) with her twenty-three-year-old son, Ryan. Savvy and a true philosopher at heart, he asked her a simple question: Why should a business be socially responsible? Good question, she reasoned, especially since socially responsible 134actions can include developing a more expensive product, limiting your distribution channel, paying higher salaries or commissions, and donating a portion of your profits to a worthwhile cause—actions that could bite into your bottom line from a purely revenue point of view. Some people might contend that it makes more sense to be as profitable as possible as quickly as possible and then do good for society with the money you’ve earned. Many companies have done that over the years, much to society’s benefit.

To help us answer the question and pinpoint why it does make good revenue-building sense to be socially responsible, Nadine spoke with Derek Taylor, CEO of Global Solutions Group USA. Derek is well versed in financial management, Securities and Exchange Commission reporting, and Sarbanes-Oxley compliance and risk management. He is also the designer of “Budget Management Training for Non Profit Managers,” a program that guides participants in developing world-class solutions to real-world problems.¹

Derek believes that if companies abandon socially responsible ideals and do whatever it takes to keep profits high, their actions will eventually hit their bottom line in a negative way. He cites the recent spate of scandals that have toppled huge corporations and hurt the standing of companies that are still in business but are now trying to correct their actions—sometimes at great expense.

To create sustainable relationships, a business must do well by doing good because customers choose where they want to spend their dollars. And a strong relationship with your community is one of the best relationships a business can forge, Derek believes.² That’s because your community can support you when times are tough—a fact David Yudkin of Hot Lips Pizza discovered when he and his wife were restructuring the business and 135struggling to pay off the previous owners’ sizable debt. Throughout this difficult period people within the community continued to give Hop Lips their business. By becoming a good corporate citizen in your community first, you recycle money back into your community. This fosters loyalty to your business among local citizens—customers who can support you in the long run. And you can expand this “doing well by doing good” philosophy beyond your community as your business grows.

Warm Spirit has experienced this expansion of social responsibility as more and more consultants joined the business and created their own communities throughout the United States. In addition, Nadine has contracted with minority- and women-owned vendors to supply the company with many of its products, thereby helping these small businesses grow and become more successful. And now she is reaching out to other parts of the world by using the company’s mission of empowerment to support women in Northern Ghana. Nadine recently began purchasing shea butter, used in many Warm Spirit products, from a women’s cooperative in the region. Profits earned by these women are then used to support education and health initiatives in their communities.

The real crux of the issue may be a simple matter of building long-term integrity—coupled with financial stability—versus seeking short-term financial gains. You’ve learned from businesses like Tweezerman, Tom’s of Maine, Imagine Foods, French Meadow Bakery, and Birkenstock USA that operating a business in a socially responsible manner can lead to increased sales, strong and effective alliances, and even lucrative company buyouts. And no one is espousing doing poorly financially just so you can be a good corporate citizen. What the companies featured in this work and many other companies throughout the world demonstrate is that you can create a business with strong 136core values that support social responsibility, be innovative in your strategies to build sales and form powerful distribution channels, and come out a winner on many levels: by succeeding financially, by furthering your mission within your industry, and by improving society as a whole.

None of us can change the world single-handedly in one fell swoop. However, each of us can contribute to making the world a better place. That’s what these companies are demonstrating time and time again, often with creative sales campaigns or innovative alliances—even basic day-to-day operating policies— that contribute to how well they sell their products or get them to their customers. And each time they experience revenue growth and expand into a new market, they are telling the world that values can make a difference.

Paulette Cole, CEO and creative director of ABC Home Furnishings (part of ABC Carpet & Home), is a businesswoman who understands and embraces this philosophy, even after many years of success without practicing sustainability and promoting conscious consumerism. She realizes it will take effort to transform ABC Home Furnishings into a socially responsible business. As she points out, when you’re starting a business, you can build it from the ground up and make certain choices about how you want to operate that business—how you want to define your story. For an established store like ABC Home Furnishings, it’s all about transitioning and finding products to match the store’s high expectations of beauty while retaining as much as possible of the indigenous “DNA” of the products’ design and practicing sustainability. But Paulette is confident that social responsibility’s time has come. “From my point of view, investing in social responsibility and opening businesses that are socially responsible will be a lucrative direction for many businesses—all businesses I should think. It’s the way of the future. I think that 137all the designers will be encouraged to design product that is not only great product but that is in service to the earth. Because we can’t be antithetically opposed anymore. It just doesn’t make sense, you know?”³

To answer Ryan’s question, we believe that operating a business with a socially responsible mission is good business. It fosters awareness of issues affecting communities and the world as a whole, which ultimately can help businesses to be valuable contributors toward making the world a better place. And as these businesses help improve society, they become more successful in the marketplace because customers—the people buying their products—respect what they’re doing.

We’re betting that more and more businesses—new and established alike—will indeed see the wisdom in using their values as their guide to increased sales and profits, that they will recognize the benefits of supporting their communities, empowering and recognizing their employees, developing strategic alliances with like-minded individuals and organizations, educating others about their product and mission, and continuing to find new customers by keeping their visions firmly in sight. And most of all, we believe they will understand that not only do values matter when it comes to building a business, values sell.