My grandfather, Ben Arvidson, started our company in 1958. My father, Jerry Marunde (his son-in-law), and my uncle Don later joined the firm, and took it over when my grandfather retired.
Though neither of them had any business background, they were very productive and industrious. Everything they did was based on what was most practical and what was considered the ethical thing to do. They operated their business on this philosophy and protected the integrity and good name of the company my grandfather worked so hard to build. They continued through the ’70s to expand their knowledge of techniques and products, and they carried on the legacy of the company, which grew to become one of the area’s oldest and largest pool-building firms.
Then one day everything changed. After 30 years in business, they had nothing to show for it. Of course, I found out about it the hard way. While still a college student, I was about to head out on a trip to Japan and was in need of extra money. My parents, who always were good for a short-term loan, told me they didn’t have a dime to spare. I would need to get a job. That’s when I knew there was a problem.
But something didn’t add up. Coincidently, I had just finished taking two elective courses in accounting, so I asked questions to see if I could figure out what had happened. When my father, uncle and the accountant couldn’t explain where the missing funds were, I began digging around. What I found was a major disappointment.
My forensic accounting had uncovered some major theft from within our staff. In fact, there were three people stealing from us in unrelated incidents over the course of several years. We had a service manager who was cancelling invoices even though the jobs were done, accepting the cash on the side and pocketing it for himself. Our bookkeeper was embezzling money from us. And an employee was stealing product to sell on the black market.
All told, they had been pilfering about $150,000 to $250,000 a year, leading my dad and uncle to find themselves $750,000 in the red.
The accountant and lawyers presented the option to file for bankruptcy and either restructure or shut down. But our family culture would not allow that. They would not go down without a fight.
Instead, they cashed in their retirement accounts. My parents, who were then in their 50s, sold all their possessions including our large, beautiful home and much of the furnishings. They pooled together the funds, paid off all their debts and virtually started over.
I had never intended to join the family business. But as I watched all this happen, I decided to go to graduate school, learn everything I could about small business, and help my family rebuild the company. Once a month I would return from school to implement the next level of ideas I learned and put more controls in place.
Little by little, we put a real business plan in place — for the first time. We hired a service to use for background checks on new hires. We began creating financial statements not just for tax purposes but so we could identify the business as an entity. We created service, retail and construction divisions and began the process of developing a history of each division to track and look at each unique aspect of the company.
The initial goal was to double the business. But we were hurt and beat up, and we didn’t come back as quickly as we would have liked. So we reassessed the situation, talked about our strengths and weaknesses, and decided how to best capitalize on them. We went back to reviewing all the basics and really started changing the company culture.
As soon as we got rid of the victim mind-set and took possession of our culture and business, we became attractive to new customers and manufacturers. We approached our purchasing from a different perspective and started seeking out companies on the move, ones that were launching new and exciting products instead of buying from those with whom we always did business. All this really helped us to take off.
The plan had been to double business in five years, but we ended up tripling it in three. Today, business is thriving. We expanded our original store from 1,500 square feet to 6,000 and are about to open our fourth location in the greater Chicago area. We added new services, including landscape and holiday lighting, and made hot tubs a legitimate entity of the business rather than an afterthought. We have dozens of trucks running routes all year long. And we have built a loyal and trustworthy staff that’s 70 strong. We are virtually debt-free. We pay our bills on time.
Of course, we still retain some of the principles and beliefs my uncle and father held. I will always be grateful to my father for thinking that everybody deserves a fair shake and is good until proven otherwise. He was a very fair man, and he taught me to respect all sorts of people. The best thing for our company is that I have learned to cherish the idea of doing the right thing and never forgetting that.
My personal philosophy is, “Don’t give up on people because you get burned.” In our case, our goal is to have good structure, good systems to enable people to function independently and not have everyone look at who is going to be the next crook. Our employees have freedom to make decisions, to do what is right for the customer and each other. And this gives me a very good sense of freedom. If I kept the business all about me and constantly was the center of everything, we would never grow.