2020 Year in Review by President & CEO Bob Erb
When I was first asked to write a ‘Year in Review’ article, it seemed like it would be an easy task to reflect on our many obstacles and accomplishments in 2020. Now, as I try to put these thoughts together, I find it difficult to know where to begin. How is it possible to put down on paper what we faced last year and, more importantly, to describe all we did together to get through it? How do you put into words some of the lowest lows, the highest highs, and the finest moments in the history of a company that dates back nearly a century?
The year began with our sales off to a slow start and mounting concern over a deadly contagion sweeping through the central Chinese city of Wuhan. Our global sourcing office in Shanghai provided early reports of regional lockdowns and vendor closures as the Chinese government tried in vain to contain the spread of what is now known as COVID-19. Our supply chain ground to a halt as the Chinese New Year holiday period was extended, and our GSO office became the first of our groups to face the coronavirus pandemic, taking swift action to implement social distancing, face masks, split work groups, and eventually moving employees into work-at-home environments, along with other measures to protect our team and stay up and running.
Adapting is not only necessary, it’s critical…Early intelligence from our group in Shanghai was vital in not only demonstrating how dangerous this pandemic could be, but also in giving our U.S. team a head start on planning for the inevitable spread of the virus to our operations here. Our supply chain teams worked aggressively to deal with constant changes in production schedules, limited product availability, transportation constraints, and complete vendor shutdowns in many cases, while our operations staff took steps to keep our teams safe and our business moving.
What began as a soft Spring season for our mail order companies fell into the abyss in March. The NBA season was suspended on March 11th, with the NCAA cancelling its March Madness tournament shortly thereafter. Colleges and school districts across the country shut down, and businesses of all types soon followed. Our world turned upside down in a flash as the pandemic took off across America and left a trail of death and destruction in its path.
Complex problems often only have options, not solutions…Our teams, including great work by HR, IT and Maintenance, took fast action to implement changes to procedures, workspaces and work schedules. This included ultimately lifting nearly 600 office staff out of office environments and into home offices virtually overnight. Meanwhile our sales plummeted, and throughout March we fell short of our budgets by more than 20% on a weekly basis, with apparel brands missing plan by far more. Our private aviation charter business came to a virtual standstill as business and leisure travel became unnecessary and impractical. Unemployment more than quadrupled by April, with more than 20 million Americans finding themselves suddenly out of work and the economy in a free-fall. A devastating depression seemed inevitable. We prepared for the worst and wondered how rough things would eventually get.
Then, in mid-April, something unexpected happened. While our apparel brands were flattened by stay at home orders and work-from-home realities, our other brands began to come to life. Our loyal customers, along with many new customers, turned to direct shopping in a shift so dramatic that, instead of facing potential layoffs, furloughs and deep cost cuts, we instead scrambled to keep up with a raging torrent of customer demand that seemed to come out of nowhere. Within six weeks, buoyed by an incredible surge in our food and hardgoods brands, we were back on track to our original budget, and would finish the Spring season $10 million ahead of our prior year results and with strong momentum heading into Fall.
Execution of a plan can be more important than the plan itself…While our Spring sales were taking off, our teams were frantically adjusting our catalog offers for Fall, getting nonfood product received and food products produced, adjusting our photo shoots to implement safe practices, and a whole host of other maneuvers made on the fly and with little concrete information to go on. With our supply chains still on their heels and our teams learning to work in new and different ways, both in-person and remotely, we adjusted our sales targets for Fall to take advantage of opportunities that seemed impossible to fathom only a month before. Our internet advertising performed at a level we’ve never seen happen, with more eyeballs online than ever and customers looking for ways to shop safely and get through the pandemic successfully.
Cash poured in from account payments like never before as many customers put government subsidies to work by getting their financial houses in order amidst an economic meltdown more rapid and severe than any in U.S. history. And although we finished Spring on a high note, growing our sales for the first time in five years, the real challenges stood in the road ahead as we wondered how we would get through our peak season with customer demand continuing to accelerate, the spread of the coronavirus expected to spike, and our shipping partners signaling higher costs and tighter capacity than were expected when our plans were originally built.
While confronting the brutal facts about any predicament is critical, it’s also important to always have faith that you will prevail in the end. This concept was coined the “Stockdale Paradox” by Jim Collins in Good to Great, referring to Admiral Jim Stockdale, who is quoted as saying he “never lost faith” that he would make it out of a prisoner-of-war camp during the Vietnam War.
Several times I’ve characterized the challenge for getting through our Holiday peak as the equivalent of playing two games of chess simultaneously while riding a roller coaster in the dark – difficult, stomach-turning, terrifying, and with few landmarks to guide us. But our people never flinched, and plowed ahead with an incredible spirit, clear purpose, and unfailing effort as every single team across the business did what they had to do to deliver on our promises to our customers and to make sure we held the line for each other and got the job done.
Our office staff jumped in to help in operations in the 4th quarter, working nearly 25,000 hours to bolster our production and fulfillment teams and to allow us to hit our shipping windows and handle the surge in demand that pushed us to the limit and then some. We simply refused to fail…
The year 2020 will forever be remembered for the vast tragedy, suffering, chaos, and collapse that took place all around us. But what is astonishing is that amidst this stark and startling backdrop, our Colony Brands team not only held the line, but charged ahead, and relentlessly wiped out every obstacle that got in our way. Our sales grew for the first time in five years. Our customer payments came in stronger than ever. We achieved the best safety record in the history of the company. Our employee engagement rose. Our customer satisfaction held firm. And our support of our communities grew. What seemed impossible in mid-March came true by December. But when people come together around a broader purpose, commitment to one another, and work fast, hard, and relentlessly to get things done, magic can happen. This past year is proof of that. Just take a look at some of the many conversations and virtual events we’ve had over the year:
Looking back now, it’s a true testament to the quality and character of our teams, and their care and commitment to each other and our business that made our 2020 accomplishments possible. While our strong financial footing and our established position in the marketplace gave us an edge, at the end of the day, our people made the difference, plain and simple. At a time when many companies were either failing or fighting for survival, our teams not only kept us moving forward but doubled down on our strategies and moved faster and worked harder than ever before.
So as we begin our 95th year at Colony Brands, never has Ray Kubly’s vision, spirit, commitment, and passion for ‘Delivering the Magic of Christmas’ been more alive and well than right now. For all of us, for each other, our future is brighter than ever because of each and every one of you. Congratulations on making 2020 a year we will always remember, for all the right reasons.
-Bob Erb | Colony Brands President & CEO