Knowing When To Take A Risk

with Lee Keating

KnowLarry: I am with Aspen Performance Ski shop owner Lee Keating, and she is going to share her insights on knowing when to take a risk and how that has gotten her business to be the most successful ski shop in Aspen. 

Lee, can you share what was the biggest gamble that you and your husband took?

LK: Every step is a gamble. Every day, every step is a gamble.

We have no formula.

We don’t show up to buy with spreadsheets. We buy from our gut.

What we think and what we feel at that moment is fantastic. So many buyers show up at a showroom and they have the spreadsheet from last year and tells them to buy 10 sweaters, six skirts, four dresses, and five blouses.  That’s their formula.  And that is what they do.

Taking pride of every aspect of what you're doing will make you stand out from the crowd. Click To Tweet

Well, if the skirts and sweaters and blouses are all ugly and the dresses are fantastic, then just buy the dresses!

But they feel like they have to go with the formula, no matter what, then they wind up with things no one wants.

Sometimes we’ll take a big risk and see something we love and we’ll buy a hundred pieces. And 90% of the time it works.

Sometimes I do make a mistake, but it’s all about going with your gut.

LW: But really, that’s how you learn and that’s how you progress.

What would you say early on was the biggest risk or biggest gamble that you can remember that sticks in your mind that you really had to struggle with?

LK: Well, it’s never for me, it always has to do with how much money we spend.

And so when we made a million dollar order at Prada, my husband just about had a nervous breakdown. I’ll still remember standing out in the street, waiting for our car. And he’s like, “Oh my God, Oh my God. We just spent a million dollars on jackets.”

KnowLW: But it paid off.  You got it because we all love Prada, but you guys became the biggest sellers of Prada. You did that in spite of the fact that you were in a ski boutique size store.  What actually was the size of the store you were in at that time, before you moved to the bigger space on the corner where you are now?  

LK: Yes, it was, it was 900 square feet of retail space. It was tiny.

LW: Very tiny. But out of that tiny space, you sold more Prada ski wear than any store in the world, as I remember it.

LK: Yes, that’s correct.

LW: Yes, and not just for one year, it wasn’t like a lucky year, correct?

LK: No, I think we still try to.  From first year they did the sport collection, which was maybe 1999, until 2009 was our last year doing the sport with Prada because they stopped doing the sport and  they also kicked us out because they didn’t think my store was nice enough.

LW: Yes. They flew in.  They had new corporate leadership.  All of us who have been in the corporate world have had to deal with new CEOs who feel like the world was created the day they got in charge and that nobody knew anything up until they got there and they have to change everything.

And so they wound up building the big Prada store in town and said your store just didn’t measure up to their standards for some stupid reason, in spite of the huge sales.  

But that didn’t slow you down. Prada came out the losers in that.

I wonder how much product, how much ski wear and how much they sell overall at that big, expensive store that they have around the corner now. But that didn’t slow you down at all. 

LK: The following season, they stopped with the sport collection and that was actually pretty devastating.

Both very much hurt my feelings. I felt terrible, but also suddenly we had a buy order of over $2 million and I did not know what I was going to fill it with.

It just so happened a few months later I was in Italy and our friend Gustavo, who had the Authier brand, was trying to figure out what his next step was going to be. Just as luck would have it, I had been thinking hard about starting my own clothing line so we teamed up together.

LW: Yes. I remember going, living through that because it was traumatic for really all of us because, you know, we like Prada and we got our product from you. We had lots of it. And there were a bunch of us that even wrote letters to the president of product to get them to reconsider.

LK: I know they didn’t care.

LW: And so, you know, it was almost like divine intervention in your career because had they not gotten out of the way, Authier wouldn’t have happened. Right?   

LK: Yes. It’s a hundred percent true.

LW: So you would have been bound to the corporate thing. It would have been hard to make that decision on your own. You know that would have been crazy just to drop a product or a new idea.

But since they took care of that problem for you, bam, you were right in position to take advantage of it. And how has that turned out for you?

Know

LK: Unbelievable. Absolutely unbelievable because Authier is one of our biggest selling lines of clothing.  We not only have our own brand; it’s a huge seller.

LW: And you’ve used your instincts to navigate the last COVID situation better than any other store in town.  You basically refused to back down and immediately have a fire sale on all your inventory.  The result was that you probably came through the whole winter season and lockdown better than any other retailer in town. You refused to panic and you took a lot of criticism for that.  

LK: Yes, exactly. But you just can’t sit around and feel sorry for yourself and wait for somebody to do something for you. You have to just wake up in the morning and go and make it all happen.

LW: There’s always people that have got a better idea about how you should run your business. If their ideas don’t turn out, you’re the one who’s got to clean up the mess.

What I see in that situation, Lee, is you went with your gut, just like you do always.

LK: Exactly a hundred percent. I mean, it was a risk.  When everything went sideways in March and I saw people liquidating merchandise, I told my husband that I think we need to hold tight. I think that Aspen’s going to be a nice place for people to be.  We have beautiful things.  They will be discounted, but they won’t be liquidated and I’ll bet you we’ll end up okay.   We kept everybody working, and they work hard for us. So why not? And it’s been fantastic.

People have been incredibly supportive to us.  Our customers and our employees have been fantastic. And they were so grateful that during the whole shutdown that they were still receiving a paycheck from us and not having to deal with the hassle of unemployment.

LW:  Every step is a gamble. And if you want to be in business for yourself, it’s going to be a lot of hard work.

It’s going to be hard work beyond what you think hard work is now.   You take pride in every aspect of what you’re doing.

You’ve got a chance to take those gambles, those risks and make them work because most people are not going to work.  I learned that a long time ago, you beat 50 percent of the people just by working hard. 

Know

 

LK: You have to stay committed because you have to believe you’re doing the right thing, but when you mess up, you got to say, okay, this is wrong and let’s move on. You can’t try to milk a bad idea. That’s for sure.

LW: I love it. Thanks so much, Lee. This has been great. And I look forward to having you get back with you and talking about these things some more.

Click here to listen to the Million Dollar Mastermind Podcast episode #131 with Lee Keating!

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