Winners’ circle

Jim Bergeson,
Bridgz Marketing Group:
952.841.6120
jb*******@****gz.com
www.bridgz.com

Lisa Bollin,
Cowgirl Tuff Co.:
612.331.5977
li*********@***********co.com
www.cowgirltuffco.com

Ron Weber,
IBuyOfficeSupply.com:
866.568.0524
rw****@**************ly.com
www.ibuyofficesupply.com

Tom Salonek,
Intertech:
651.994.8558
ts******@*******ch.com
www.intertech.com

Four smart CEOs describe
worthy ways to grow

by Beth Ewen

When Upsize this fall asked Minnesota small-business owners to submit their best business-building practices, four finalists rose to the top of an impressive roster of entrants: Bridgz Marketing Group, Cowgirl Tuff Co., IBuyOfficeSupply.com, and Intertech Inc.

These four stand out because of their strong revenue growth in the past three years, the impact of their best practice on company performance, and their CEO’s approach to growing profitably. They presented their stories in November before a panel of judges gathered at Winthrop & Weinstine law firm’s downtown Minneapolis headquarters, and coverage of all four follows.

The judges named Cowgirl Tuff as Upsize Business Builder of the Year, recognizing its impressive revenue gain over three years, plus its CEO’s authenticity and her devotion to profitability. An in-depth interview with CEO Lisa Bollin follows the finalist coverage, and her picture as overall winner graces our cover. Nominations for next year’s contest open in the fall; eligible companies must be based in Minnesota and have fewer than 100 full-time employees.

the info

The contender:
Bridgz Marketing Group, Edina
16-year-old marketing agency
65 employees

The boss:
Jim Bergeson, president and CEO

Best practice:
Created an analytics model for organizing scattered, hidden data into a nimble database. It’s called BUD, for Bridgz United Data. Launched in early 2011, BUD has snared three new large corporate customers for Bridgz, its target market for the tool, and differentiates the agency from others..

The revenue growth:
$11.53 million in 2008
$12.56 million in 2009
$12.64 million in 2010

The word:
Judges commend Bridgz for investing in a tool that corporations demand for measuring ROI, and for growing revenue in a tough time for marketing agencies as corporate customers slashed spending. If Bridgz indeed doubles its top line over the next several years, as Bergeson predicts, the story will be bulletproof.

Bridgz Marketing’s
data-crunching tool
shows early promise

Jim Bergeson believes that most customers, especially large corporations, suffer from too much information. 

“15 to 20 years ago, clients were starved for data. Fast-forward to now and most companies are drowning in data. They have trouble getting their arms around it,” says Bergeson, CEO of Bridgz Marketing Group in Edina. 

Pronounced “Bridges,” Bridgz is a 16-year-old, $12.6-million, 65-employee marketing agency, and one of four finalists for this year’s Upsize Business Builder of the Year award.

To gather and make sense of all that data, two years ago Bridgz began investing $1.5 million in time and money to develop a tool for organizing scattered, hidden data into an accessible database. The process is called BUD, for the Bridgz Unified Data model.

“It’s a robust data management system for all companies,” explains Tim Altier, the Bridgz exec who led the development of BUD. “IT has data. Your call center has data. Your online store has data,” Altier says, and rattles off several more. “We repurpose all that data for the purpose of marketing.”

BUD gives Bridgz the ability to accurately measure return on investment for all of the marketing expenditures it develops for its clients-a key to prying marketing dollars from large corporations, especially. Fortune 500 companies are the target for BUD. 

Heavy-equipment maker Caterpillar has signed on, Bergeson says. “For Caterpillar, we returned almost $10 in sales for every $1 invested.” Procter & Gamble, too, is a client. “It’s the really big companies that are swimming in data,” Bergeson says. Since they launched the tool in early 2011, they have three new large corporate customers in hand.

Judges for the Upsize Business Builder Awards agree that the promise is still to come for Bridgz. Chuck Palmer of Wipfli asks Bergeson whether the tool can work for companies other than the Fortune 500s. “How scalable is this tool? Right now it’s Fortune 500-but there’s only so many of those.” Bergeson responds that BUD can be used by any size or type of company.

Karen Bertulli of Winthrop & Weinstine asks about the timeline for the system. “How many times do you interact with those companies?” she wants to know, indicating that large corporations can be demanding clients that Bridgz will have to satisfy over the long term.

Revenue has grown since 2008, from $11.5 million that year to $12.64 million in 2010, according to Bergeson. That impresses the judges, who commend the feat during terrible economic times. But they believe the true boom for Bridgz lies ahead.  

“We fully expect to double our agency in three to five years, top-line revenue,” Bergeson says.

If they do so, judges say Bridgz should enter the Upsize Business Builder contest again and be highly likely to claim the top spot.

the info

The contender:
Cowgirl Tuff Co.; Women’s, and now men’s, apparel wholesaler
30 employees, in Cokato

The boss:
Lisa Bollin, CEO and director of design

Best practice:
Launched a marketing campaign this year for a new line of jeans called Wing & A Prayer, which donates $5 for every pair sold to Western Wishes, which helps kids with life-threatening illnesses. The line sold twice as many pairs as usual, and Bollin believes the effort gives back to the industry that has made her company successful.

The revenue growth:
$3.02 million in 2008
$4.79 million in 2009
$7.8 million in 2010

The word:
Judges like Bollin’s strong revenue growth, but they love her relentless focus on profit margins, which they say is sometimes missing from entrepreneurial, high-growth companies. They also like her marketing smarts, such as heavily advertising in magazines that her audience reads, and her authenticity.
Spoiler alert: Judges are so impressed that they later name her Upsize Business Builder of the Year.

Cowgirl Tuff CEO
combines true love
of clothes, horses

Decked out in turquoise jewelry and fancy boots, Lisa Bollin stands out from her dark-suited fellow finalists at Winthrop & Weinstine’s tony downtown law offices, where they’re competing to be named the Upsize Business Builder of the Year.

She turns her back to the judges to show the fancy rhinestones on the pockets of her Cowgirl Tuff jeans, the apparel line introduced in 2008 that has propelled her company from a tiny screen-printing shop to a $7.8 million force in the Western clothing business.

“I’ve been in women’s clothing for 25 years, so I love clothes,” says Bollin, CEO of Cowgirl Tuff Co., with 30 employees in Cokato, Minnesota. “I also love horses. I knew there was something missing.

“I know my industry had a lot of sleeping giants,” she says, like Wrangler and Levi’s, who she says didn’t cater to fashion-conscious women customers who also are mad about horses. Bollin says “cowgirls” like her want to wear their comfortable, flashy and extra-long (so they don’t ride up) jeans while barrel racing, working on the ranch or going out on the town.

“I’m bringing something brand new to the industry,” Bollin says. “We’ve branched into a market that I knew our competitors weren’t in.”

Cowgirl Tuff’s inspiration was simple: “Being an average size woman and being frustrated in the dressing room,” where Bollin says she, like countless other women, would try pair after pair of jeans and not find one that fit.

“We have 12 waist sizes, from 24 to 36, and four lengths,” she says. The rise on the jeans is longer in the back than in the front, eliminating the gap at the waist that exposes so many backsides. And they’re 2 percent Spandex, leading to a fit that she says works for any customer.

This year, Cowgirl Tuff put together their first marketing effort in partnership with Western Wishes, a foundation that works to make dreams come true for kids with life-threatening illnesses. In the fall, Cowgirl Tuff introduced a new jean called “Wing & a Prayer,” and pledged to donate $5 to Western Wishes for every jean purchased.  So far they’ve sold 7,500 pairs, which is twice as much as usual. And they will make a donation of $37,000  to Western Wishes, she says.

Karen Bertulli, an attorney at Winthrop & Weinstine and one of the contest judges, asks Bollin about price: $75 to $120, Bollin replies. “Compared to Wrangler, it’s twice the price,” Bertulli says, and she and other judges like her focus on profits.

Bollin says “the best thing I ever did” was choose a high price point for her jeans, where profit margins can be 40 to 65 percent. She resists other ideas, such as a children’s line that some have suggested, because she can’t command a big margin. Men’s jeans made the cut this year, however; the B. Tuff line-for men but marketed to women because women buy 75 percent of men’s clothes-is debuting now.

Says Bollin about her customers: “They live in their own world. Horses are their life.”

the info

The contender:
IBuyOfficeSupply.com
E-commerce seller of office supplies and furniture
8 employees, in Plymouth

The boss:
Ron Weber, president

Best practice:
Uses a low-employee, no-inventory, high-technology approach to selling over the Internet at deeply discounted prices. With a long background at big-box office supply and furniture sellers, Weber knows there is room for a small player to get market share, even a small slice of which is enough. 

The revenue growth:
$1.94 million in 2008
$2.71 million in 2009
$4.65 million in 2010

The word:
Like other entrepreneurs before him, judges say, Weber is using the Internet to get his share of a burgeoning business, and his revenue numbers show he’s executing well. They like his customer service practices, saying those might retain customers initially attracted by discount prices alone. Developing a management team and processes to support sustainable growth will be the next challenge.

IBuyOfficeSupply.com
finds plenty of room
to undercut big players

Ron Weber spent years in the office supply business before starting his own e-commerce company, IBuyOfficeSupply.com, based in Plymouth. He says those big retailers leave so much room in the enormous business for a player like him that “it’s not even funny.”

Actually, he didn’t say that. Rather, he wrote it when he prepared his remarks to present as one of four finalists for the Upsize Business Builder Awards. On the day of the judging event, in November, Weber was too sick with the flu to attend.

Along with his apologies-and the much-appreciated comment that he didn’t want to make others sick, too-he e-mailed remarks that he intended to present, about the way he approaches growing his young company.

IBuyOfficeSupply has posted impressive numbers, the main point that caught Upsize judges’ eyes when a large pool of applicants who submitted their companies’ best business-building practices.

The company posted $1.9 million in revenue in 2008, then zoomed to $2.71 million in 2009, then shot to $4.65 million in 2010. With only eight employees, judges note a very profitable business model indeed.

Weber relies on the company’s “technologically advanced system that allows us to provide office supplies and furniture at deeply discounted prices.” And, they do this with no inventory-again, a point noted by the contest judges, including a banker, an accounting firm exec, an attorney, a journalist and business owner, and a two-time entrepreneur. The company ships from more than 90 warehouses in the United States and Canada, and from about 30 manufacturers.

Judge Terri Banaszewski, vice president at Park Midway Bank, especially likes his dedication to customer service. If there’s a mistake in an order, for example, the company allows the customer to keep that order rather than shipping it back, and promptly sends a corrected order as well. Weber believes his company’s smaller size is an attraction for customers who may feel ignored by the bigs.

Writes Weber: “The big box retailers’ continuous price escalation has allowed plenty of opportunity to provide customers with significant savings while making a profit. Coupled with excellent customer service, this model is proving to be very successful.”

The next step for Weber’s firm, judges note, like many young, fast-growing firms, may be to build up the management team that could drive sustainable growth-and provide a substitute when the flu or other problems hobble its leader.

the info
The contender:
Intertech, Software training and consulting company
60 employees, in Eagan

The boss:
Tom Salonek, CEO

Best practice:
Invested $30,000 to equip an Eagan training facility so that students everywhere could participate fully in courses, in response to the latest economic slump that led to a typical drop-off in training revenue. Looking for other ways to expand training sales beyond the Midwest, too, such as launching a reseller program where other firms outside of this geography sell courses.

The revenue growth:
$7.03 million in 2008
$6.05 million in 2009
$7.63 million in 2010

The word:
Judges like Intertech’s swift and smart reaction to a revenue slump caused by economic trends that it has weathered before. They see additional possibilities for the company’s virtual training expertise, as well, although those seem beyond the company’s core. Increased marketing, too, should help the firm stay on a growth path. 

Investment in virtual
training gets Intertech
back on growth track

When the economy gets tough, training for employees often gets cut, says Tom Salonek, CEO of Intertech, an Eagan-based company that both makes software and teaches programmers at other corporations how to make software.
“When you’re forced to make a decision to fire these people or to cut training-people cut training,” Salonek explains. “Any time the economy turns, it’s a challenge.”

Such was the case in 2008, when a $7 million revenue year slumped to $6 million in 2009, and Salonek convened his company’s regular strategic planning session with more urgency than usual.  “We walked away with a plan” to invest in virtual training, spending $30,000 to outfit Intertech’s training room so anyone could attend a class live and participate in discussion, without incurring travel costs to get to Minnesota.

USB headsets and smart board technology allow Intertech instructors to interact with virtual students and share their classroom annotations in real time. And remote students no longer need to set up their own computers for Intertech courses. Students dial into a fully configurted environment “in the cloud,” Salonek explains.

“Within four months we recouped our investment,” Salonek says. Better, the percentage of business coming from training vs. traditional consulting is growing, in part because of a national marketing campaign to tell about the virtual option. Salonek likes the idea so much that they’re planning to double the size of the facility with more investment.

Best: Revenue in 2010 rebounded and surpassed the 2008 mark, to $7.63 million.

That relieves some pressure on not only Salonek himself, but also on all 60 employees who work at Intertech. Salonek believes in an open-book company, where every employee knows where the company stands financially, and gains or loses based on how well Intertech does.

Because many Intertech consultants are highly paid professionals and the sole breadwinner in their families, a company slump makes everyone especially nervous, Salonek says. They even set up an emergency fund, so if they had a good month they’d sock some money away to make it through a bad.

Chuck Palmer, managing director at Wipfli and a judge, says Intertech’s virtual model would be a great fit for other industries as well, such as the ongoing training that accountants and other professionals need to keep their certifications.

Terri Banaszewski, vice president at Park Midway Bank and a judge, commends Salonek and the other Upsize Business Builder Awards finalists for employing so many, so well, for so many years.

Salonek wraps up: “We’re making sure that we’re educating people so they get it.” He’s confident the virtual training strategy itself, as well as the additional consulting customers that will find the company through their expanded marketing efforts, will keep the growth coming.