Expanding into a Brick & Click Business

Could there be benefits to going old school and connecting with people out of a physical store?

Tony Rodono of City Prints Map Art and, more recently, MapShop.com did just that. Tony transitioned to working out of a brick-and-mortar shop, and shares his ups and downs of the shift, including interacting face to face with customers and managing a brand new team.

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(With your host Andrew Youderian of eCommerceFuel.com and Tony Rodono of MapShop.com and City Prints Map Art)

The Full Transcript

Andrew: Welcome to the eCommerceFuel Podcast, the show dedicated to helping high six and seven-figure entrepreneurs build amazing online companies and incredible lives. I’m your host and fellow eCommerce entrepreneur, Andrew Youderian.

Hey, hey, guys, Andrew here and welcome to the eCommerceFuel Podcast. Thanks so much for tuning in today. Today on the show, bringing you a discussion with community member, Tony Rodono, who is the longtime owner of City Maps, an online site selling beautiful map art, and who recently purchased a brick and mortar store in Charlotte, North Carolina with 8 to 10 employees, a pretty big acquisition for him. And I think in our space, we definitely have people that have those storefronts, but I’d say the majority of myself, the majority of our members in our community are probably online only. And so just a fascinating acquisition from my perspective. I wanted to talk to Tony about how it went, what was the rationale behind doing that, how’s it been going, what are some of the challenges and some of the benefits of getting that brick and mortar business. Interesting discussion, so I hope you’ll enjoy it and we’ll go ahead and dive right in. Tony, so congratulations on closing your first brick-and-mortar purchase. April 1st, right?

Tony You got it. Now, thanks so much, Andrew.

Andrew: Yeah, that’s fantastic. And the name of the brick and mortar that you purchased was mapshop.com, or at least that’s the website, but it also has a corresponding physical building, correct?

Tony: Correct. Yeah, everyone in town just refers to it as “The Map Shop“.

Andrew: The Map Shop, that’s so cool. But before that, you were running a business called City Prints, right?

Tony: That’s correct.

Andrew: Okay. And can you give us just a real…obviously both deal with…or The Map Shop deals with maps, but can you give just a quick overview of what both of those businesses kinda do?

Background of Tony’s Businesses

Tony: Yeah, so City Prints, we launched that about four years ago and we make map art. So our pieces kinda look like modern, abstract art, but represent the places that you’re most passionate about. The Map Shop is more on the traditional map space, so wall maps, folded maps and then we do, you know, a lotta custom maps too for businesses.

Andrew: Got you. And you’ve been running it for four years and that was a lot of print-on-demand, you didn’t necessarily have a storefront, it sounded like it was a pretty lean operation, right?

Tony: Absolutely. That was kinda, you know, what my mentality was at the time, you know, really lean staff, mostly outsourced, no people problems, you know, work from home, no commute and hang out with the fam whenever I want. You know, complete freedom, low overhead, t-shirts and jeans everyday, you know, like you said, print-on-demand 100%, carried no inventory. So yeah, The Map Shop is none of those things. So it’s definitely been a transition, but I’m having a ball with it.

Andrew: So it begs the question for a lot of people, it sounds like their ideal situation. And it’s not like you did…I mean, it’s not like, you know, the reason I got into drop shipping was because it’s not proprietary. It’s got some great benefits of a lot of the things that you had where you don’t have to deal with inventory, these kinda things, but it was less defensible. On your side, you didn’t have to deal with the inventory and it was something proprietary. You guys had these unique designs, low overhead, for a lot of people, a dream business. Why expand into a brick and mortar business? What was the rationale there?

Tony: Honestly, I don’t even know, you know, it’s good. It’s one of those things where I would have not…I probably wouldn’t have sought this out because it was so different from what I was trying to build, what I was building, you know? And I wasn’t in the acquisition mindset, but the owners approached me, you know, that they’re older, they’re ready to retire and they’ve been buying city prints from us for several years, so knew me, the marketing and the different things that we did, and they thought it’d be a good fit. So, you know, I don’t know I woulda sought it out, but when I sat with the numbers, it almost became a no-brainer.

Why It Was a No-Brainer

Andrew: And what about the numbers made it a no-brainer? Was it…and maybe, especially maybe on the multiple side, like traditional eCommerce businesses, plus or minus, you’ll sell for 3X higher or lower based on, you know, maybe some of the particulars of the deal, is that the same kinda similar…kind a multiple you see with a brick and mortar? Is it lower? I would suspect might be a little lower. What kinda multiple do you pay for something like that?

Tony: Yeah, I mean, honestly, I don’t know what’s average, but I’ll tell you, we paid much less. Like, I mean, basically, the amount I paid was less than the value of the inventory on paper, you know? And I mean don’t get me wrong, the deal still isn’t, like, a slam dunk, you know, we have a lotta work to do, but it was hard to refuse just from a number’s point of view. And let me give you a little more background as to why that even happened. The owners, I mean, basically handpicked me to continue their legacy. It’s a husband and wife that’d been running it for 25 years. So I mean, that right there, and then the fact that they were gonna be my landlords because they own the building, we both had almost the exact same interest, you know, I mean namely, the success of the company going forward. So I mean, deal points were ironed out really, really quickly.

You know, another great thing that kinda attracted to me too was, you know, the owners were gonna stay on through the transition. I mean, there’s still on right now. I think we’re gonna transition them out probably around the end of the year. So that was another great thing. And then even though…yeah, so I was outsourcing the printing and fulfillment with City Prints, but this will give me the opportunity to bring everything in-house over time if I wanted to, at least fulfillment. You know, we might not…we might still be producing a lot of this stuff on demand, but, you know, having the ability to ship everything under one roof is pretty attractive. And then, you know, now City Prints has a showroom. And I didn’t get too many requests, but I did get requests of “Hey, I just wanna come and, like, see all the stuff and figure out what we wanted.” And I didn’t have that opportunity then, but, you know, now I do. So that’s been attractive as well.

Andrew: Yeah, so not just for the business you bought, but some big advantages for your legacy business, City Prints. When you looked at it, were there a lotta other opportunities where you said, “Oh, you know, maybe this website I could really revamp,” or “I see some processes here that could use some updating,” or were there…how much of the business where you said, “I can make that better,” went into your rationale for deciding to buy?

Tony: Oh, all of it. I mean, yeah, it’s one of those things where it is a 25-year-old business, and a lot of the systems in place were ones that were created 25 years ago, you know, and just continued. You know, it’s really hard to kinda change that stuff once you’ve been doing it for that long. But me coming in, I mean, it’s pretty obvious, “Okay, that’s broken, that’s broken.” You know, “This is inefficient, paying too much for that.” So yeah, when I started looking across the systems, I’m like, “Man, I refuse to believe that if I start improving these things, this thing and…you know, it should go through the roof.” So, you know, that’s when really when I started sitting down for the…it became a no-brainer for me.

Tony’s “Is-It-Worth-The-Risk” Checklist

Andrew: If you’re comfortable sharing, what were maybe two or three of those top things that in the kinda diligence phase you were looking at, or even before you, you know, got into the deal you just said, “Okay, here’s what I would change, huge opportunity here, huge opportunity here,” specifically, what were those?

Tony: Yeah, I mean, their website was probably the top one. It uses, you know, the cart and shop site, you know, so a really old, non-ideal, kinda clunky cart, not to completely slam the product, but at least…but, you know, their own style, their version was pretty tough. But the website does a good deal of business, you know, almost as much as City Prints was. And that was my thing, you know? I mean, I built that site, you know, from scratch to make it hum and to make it really go, and this company, without really trying, was doing the same amount of business online. So it’s like, “Okay,” you know, “if I could bring over what I know, where’s this gonna go?” I mean, that’s probably the best example, but it’s almost every system. I mean, you think of anything, you have fulfillment and shipping and just that process and that, you know, the support software and that kinda stuff, you know, where it should be one step, but, you know, they have…they’re doing five or six steps. Again, it’s like, man, once we’re able to pull the inefficiencies, like, “This has gotta go through the roof,” you know? And there’s almost…I had that moment across every system.

Andrew: And before you bought the company, again, working pretty lean with City Prints, did you have any payrolled employees?

Tony: Besides myself, no. My brother worked with me and, you know, he just…I pay him hourly. And then my wife books all my travel and, like, gift shows and stuff like that, and she’s just a, you know, I call her a really expensive consultant, so. And then we had a rag tag group of, you know, just outsource freelancers. So yeah, beyond myself, no one was on payroll.

Andrew: You buy the business, the brick and mortar, themapshop.com and…you know, I guess I should stop calling it “mapshop.com”, just call it “Map Shop”.

Tony: You’re fine.

Andrew: And you inherited a team of eight people, right, like, eight payrolled people who ran that business, correct?

Tony: I think 10. Yeah, so, you know, we have the two previous owners that stayed on, we have three full-time cartographers, we have a retail manager, a shipping fulfillment manager, a framer and then two part-time retail assistants. So yeah, it grew considerably.

Andrew: Wait, wait, you have cartographers? These aren’t just, like, maps that…you’re actually making the maps that you’re selling?

Tony: Yeah, man. No, we…

Andrew: That is so cool.

Tony: Now not all of them, but…and I wanna do more, that’s one of my main kinda vision points is we’re still buying a lotta maps from a lotta places and I wanna make ’em all. We mainly are building custom maps for businesses, they need them for specific reasons, so planning, sales, territories, or you’re a delivery-based business, or even, you know, we work with a lotta Jehovah’s Witness congregations, you know, to kinda create their territory maps and stuff like that, so that’s primarily the jobs that our cartographers are working on now.

Managing a Team

Andrew: That’s such a cool role. What I was gonna ask you before I got excited and distracted by the fact that you have cartographers, was that seems fairly intimidating. I mean, managing 8 to 10 people in and of itself, but to buy a business and then without really any input of your own, it’s not you could’ve built this team from scratch, you get handed this group of people, 10 people, that sounds daunting. How has that worked out? Have you had to replace people? I mean, how have you tried to quickly come up to speed on managing a team? What’s that been like?

Tony: It was probably the biggest concern for me early on, you know, getting into this. I tried to get to know, you know, the team prior to closing, but yeah, how much can you really get to know, you know, people in just a couple months, especially when they know you’re gonna be, like, the new boss, you know? So I was pretty buddy-buddy with people, you know, coming in, but honestly, I got really lucky with the staff. Everyone has exceeded my expectations. But I think my situation is a bit unique because…I mean, you know, the owners that are helping me out now, they’ve been with the company for 25 years, the next three employees have been with the company for 18, 16 and 13 years, you know? So it’s not like I have, you know, a transient group of, you know, part-timers that…with a high turnover. You know, I’m pretty lucky, so…I mean, don’t get me wrong, you know, we have some efficiency issues. I think people’s roles will shift over time, but all in all, I cannot complain about the team, they’ve been great.

Andrew: I mean, you went from no inventory to having a significant amount of inventory. Thoughts, I mean…I know it’s only been a couple two, three months, but what have been your biggest takeaways in terms of learning how to deal with inventory in terms of…yeah, what’s that like? What lessons have you learned in that short time?

Tony: Honestly, I don’t even understand it completely yet, you know? My feeling about it is there’s just so much red tape around kinda the accounting and the receiving of inventory. I’m still kinda kicking a can down the road a little bit to fully understanding that. You know, in the old days with City Prints, when I wanted to add a new product, I just design it and add it to the website. That’s it, you know? So now, I mean, I wanna add a new product, I need to design it and then, you know, cost the assembly, set up the new skew in accounting, you know, add it into our, you know, our book system, issue a PO, then I can, you know, print it and frame it, then I have to receive it into inventory, you know, put it out on the floor and then add it to site. And you know, it’s like, “What?” Like, that shouldn’t… And maybe I’m doing this wrong, but, you know, that’s my understanding of how we need to do this. And, you know, I wanna add a ton of new products, so I’m looking at doing that process, like, several hundred times in the short-term. So that, for me, was pretty eye-opening for me. It’s like, “Man, this is just a completely different game and it’s gonna take a long time to kinda get rolling.”

Cash Flow for Inventory and a Team

Andrew: What about in a similar sense, what about cash flow, because you got inventory coming in, all of a sudden you’ve got, you know, 10 people on payroll, very different from the mile you used to have. Has cash flow been an issue? Is that something you’ve had to get a crash course in and any insights into, you know, to maybe other people who…that they’re gonna be facing something like that?

Tony: Sure. No, it’s yeah, much more of an issue now. I mean, mainly because I have huge checks to cut every month, you know, namely, payroll and rent, that I didn’t have on the City Prints side. You know, I used the…we’ve talked about it in the forum, the profit-first accounting method, you know? And I set that up with City Prints at the beginning of last year and I really have it humming now. I mean, there are never any surprises, I have cash when I need it, you know, to pay expenses or taxes, all that kind of stuff. You know, with The Map Shop, it’s just…the stakes are higher, the numbers are bigger and I really have to be on my game to stock away cash every week for, you know, payroll and expenses and rent and taxes. And if I don’t…if I’m not disciplined with it, I can get into some trouble fast, and, you know, it’s not me on my own anymore, there’s, you know, people’s lives that can be affected now. So it’s definitely been something I’m really, really aware of.

Andrew: We’ll link up to the profit-first thread in the private community. But you’ve been doing it for a year, is that something that…has it worked out well for you?

Tony: Yeah, it’s great. For me, and I don’t think…you know, I’ve talked to people were it just…it doesn’t work them, their mind doesn’t think in that way. And I did not come from an accounting background, you know, doing the books or something that I’d dreaded every week, but, you know, kinda forcing myself to get in the system and follow the system, it was rough at first, I’ll tell you that. but now, I mean, like I said before, there are no surprises, like, I have cash for everything that I need. And, you know, I mean, even, like, the end of the year when I’m having to pay, like, my pass through taxes. I mean, years before, it was just like, “Okay, I hope by April I’ll have it,” you know? And now, it’s just there, you know, it’s there in December, and I don’t need to worry about it. So it’s really been, you know, just monkey off my shoulders. I mean, it’s just…it’s great.

Technical Difficulties

Andrew: I mean, you alluded to earlier that seen a lotta inefficiencies, a lotta maybe outdated systems coming in, what have you done with the tech systems? Have you left them all in place, are you in the process of revamping them? And if so, like, how much of a project is that? Is that something you’re trying to tackle yourself, are you hiring a consultant to do it?

Tony: Yes, yes and no. So, you know, we’re slowly starting to get in there, but, you know, the problem is that I just can’t…everything’s tied together. So, you know, the POS is tied to the accounting, which is tied to the inventory, which is tied to the car. So I just can’t go in and start ripping out the pieces. You know, everything is together. So, you know, honestly right now, my priority is to get, you know, a good enough amount of content, associate it with the right products on the site, so I can improve convergence with my Google shopping fee that’s happening right now.

Beyond that, I mean, probably next year, we’re gonna have a end all be all build that will probably combine the, you know, the front-ends of both websites, you know, with The Map Shop and City Prints. But right now, it’s…you know, I need to get those products looking better and then we are tying in our back-end fulfillment through ShipStation right now. You know, ShipStation will take City Prints and Map Shop orders and we’ll be shipping out of the same place, which will be a huge help.

Andrew: And are you gonna try to quarterback that, or are you gonna have someone come in for the integration that’s gonna…is an expert in all that?

Tony: Yeah, I’m probably gonna do it. You know, I did it on the City Prints side. You know, it’s a little different over here, but honestly, right before we jumped on the call here, I was testing orders going through ShipStation, you know, from The Map Shop and it looks like we’re up and running. So yeah, so far so good. For the big builds, you know, probably next year, I’m not gonna do that myself, that would be too big of a distraction, you know? It’s always tempting. I mean, that’s my background, you know? I was a graphic design, brand development, web development, all that kinda stuff, so I love to tinker, I love to get in there, but as you well know now, it’s also the point where we need to hand that off to somebody else and do what we do best.

Getting More (Foot) and Online Traffic

Andrew: I think that when you announced this to the community, you mentioned…maybe I’m remembering this incorrectly, but that you were hopefully planning on FOREXing revenue in the future with the acquisition of The Map Shop. What’s your plan to do that? Is it primarily online, is it a mixture of trying to drive more foot traffic and, you know, improve the website?

Tony: Sure. Yeah, I mean, that was probably premature to say with any confidence, but…

Andrew: Yeah I think you said in two months, you were gonna FOREX revenue.

Tony: Yeah, exactly.

Andrew: How’s that going for you?

Tony: Right, right. I mean, honestly, like, right now, I’m just trying to survive. You know, I mean, the company does a decent amount of revenue, but also, it’s really expensive. You know, it has a ton of expenses. And, you know, I’m spending even more right now trying to, you know, revamp new systems and inventory, I just bought a big, you know, printer so we can print more of our own stuff. So right now, I’m just trying to hold on. But I mean, early sales results, it looks like, you know, we’re up about 30% in the last couple months, so so far, so good, but I’m, you know, I’m spending it all.

Andrew: And what do you attribute that 30% to in just 2 months?

Tony: You know, and I’m still trying to figure out why, but web traffic, it didn’t double, but it significantly increased. And I think we got a big splash. I planned a pretty big, just local media push after we announced the acquisition. And, you know, every publication that we sent to picked us up and they picked us up all on, like, the same day, so we got a pretty big splash. And I think, for whatever reason, but our organic traffic picked up when that happened as well, and I gotta attribute to that, you know, I have no other explanation. So I think it’s primarily those because of the press and some of the excitement, we have more eyes on us now than we have in the past, both on the retail and the online side. But yeah, I mean going forward, you know, I’m kinda hanging my hat a lot on this Google shopping that, you know, I think our results will improve dramatically over time as we start to optimize that. I mean, that’s kinda…you know, I get overwhelmed when I still think about everything that needs to happen, so yeah, I’m kinda taking one step at a time and just trying to improve traversal on the site through adding a lotta good content on the product and then, you know, hanging the hat on the Google shopping for now.

Andrew: I’d love to hear what kinda workload goes into something like this? Obviously, any time you buy a business, probably it’s gonna be more hectic, it’s gonna be more stressful, more hours than if you’ve got one that you’ve been running and optimized for years and it’s just not an autopilot, but you’ve got it dialed. What does your life look like since April 1st? Has it been, “Hey, you know, just full-time and hectic,” but I know you’ve got a family, you still have time to spend with the family or has it been like, “Oh my goodness, I just bit off this enormous chunk and I have…” and you’re just, you know, 70, 80 hours a week, trying to get everything…you know, there’s a lot to learn, getting everything a handle on it. So what’s your life look like since then?

Adding a Business Doubles the Work

Tony: Yeah, I mean when you think about what I’ve done and maybe this is why I drink heavily at night…I’m kinda kidding, but, you know, I mean, the…you know, I fell into City Prints and I just ran with it. And then, you know, I kinda fell into The Map Shop, which is everything that City Prints wasn’t, you know, the stakes were high, the numbers were big, I don’t know what I’m doing yet, you know, but honestly, like, I haven’t slept this well in a long, long time, you know? And I think it’s because I’m enjoying the challenge so much. And yeah, from a daily standpoint, now I’m trying to keep the hours pretty reasonable, you know? I mean, yeah, I gotta family and, you know, I don’t wanna turn my back on them, still trying to, like, you know, get work outs done in the morning because I know that just helps you with stress immensely, and I was in a great position with City Prints to kind of push that to my brother, you know, gave him a raise and say, “Hey, we don’t really have a choice, you gotta run with, like, 90% of the staff.” And, you know, he embraced that role and ran with it, which allows me to kinda focus on The Map Shop. So, yeah, I mean, it should’ve gone a lot worse. I think my schedule should be a lot worse right now, but I’m trying to keep it manageable and so far, I’m just having a blast with it. So I think I might be doing something right there.

Andrew: Nice. Obviously a lotta apprehension buying any business, but…let alone a brick and mortar, which is very different from your legacy model, what’s been the best thing that surprised you about getting into a brick and mortar shop that maybe you weren’t anticipating?

Tony: Yeah, you know, I think getting to talk to customers on a daily basis has been great. I mean, yeah, you know, email is great and, like, a social testimony is cool, but hearing customer’s stories and seeing their reaction to the product in real time, you can’t beat it, you know? So hearing, you know, feedback on different products, you know, some that I thought would work, you know, some that I didn’t think would work and, you know, people’s reaction to it has been pretty great. And then, you know, this may sound weird, but somehow I’ve managed to not know how to do anything practical here, which has been great. So, like, you know…like, I barely know how to check people out. You know, I don’t know where paper towels are kept. You know, I don’t know how to, like, create an invoice, but it’s been amazing because everyday when I walk in the door, I can work on something that improves the business, you know, instead of getting caught up in the actual doing. So, you know, I wish I figured out how to be worthless like that with my other companies, you know, and maybe I could have scaled them a lot faster.

Andrew: Because you don’t know how to do it, it means you can’t get in and fidget with it and tell…you know, micromanage. I don’t know, I tend to be a micro-manager by default. I have to fight that. I don’t know if you are, but…

Tony: Yeah, well, I mean, it’s like, you know, with the current owners, when they walk in the door, you know, it’s a swarm. Everybody comes to them with, you know, the problem they need to fix or the question they needs to answer. I mean, I just walk on in, you know, I was on the side, you know?

Andrew: “This guy doesn’t know anything, why would we go to him?”

Tony: “Yeah, Tony is worthless,” yeah, so, you know…but then I can go back and work on, you know, replacing a system and do it, you know, and then move on to the next thing. So that’s really been eye-opening for me and, you know, in future projects, I wanna…you know, through delegation and just, you know, figuring out ways to replicate that. You know, I need to do that because it’s been amazing.

A B&C’s Hardest Obstacle

Andrew: What about on the flip side, what’s been the hardest thing? Obviously, you know, more challenges coming in with this model, but has there been anything that stuck out that you ran into and you were just like, “Oh, this is awful and I did not anticipate this problem”?

Tony: You know, I think I had to shift the way I thought about or how I think about distraction. My wife would always get mad at me, you know, at home I’m City Prints working from my own home office, she has a question and, you know, I’d be, you know, real short with her and not even look at her, you know, from…just stare at my screen, because I was trying to get something done, you know, and she always told me I’d never survive in a real office because I’m really task-oriented. So someone coming into my space, you know, while I’m working is a distraction, it’s an obstacle, you know? See and that would make me mad. And I knew this wouldn’t fly here, you know, at The Map Shop. You know, I really kinda had to change my perspective that, you know, when someone walks in with a question, I need to view it as, you know, an opportunity to share my vision around the shop, or, you know, to guide them in a direction that I think will help the shop and not view it as an obstacle. This is totally still a work in progress, but I’m getting better.

Andrew: It’s tough, I empathize with you. I’m the same way, like, I’m very…when I work, I have to be in a space, no one around and I protect that time. And yeah, that seems for me would be challenging. So good luck with that.

Tony: Thanks. Thanks, Andrew, I appreciate it.

Andrew: Yeah. Well, Tony, hey, congratulations again. I love hearing about the backstory behind acquisition. You’ve done such a cool job with City Prints. Gorgeous website, really cool product line.

Tony: Thank you, thank you.

Andrew: And it’s been a real pleasure having you in the community. So best of luck with it going forward and thanks for sharing your kinda the story behind your purchase.

Tony: Oh yeah, great talking to you, Andrew, I appreciate it.

Andrew: Want to connect with and learn from other proven eCommerce entrepreneurs? Join us in the eCommerceFuel private community, it’s our tight-knit vetted group for store owners with at least a quarter million dollars in annual sales. You can learn more and apply for membership at ecommercefuel.com. Thanks so much to our podcast producer, Laura Serino, for all of her hard work in making the show possible. And to you for tuning in, thank you for listening. That’ll do it for this week, but looking forward to seeing you again next Friday.

What Was Mentioned

Photo: Flickr/Lynn Friedman

Andrew Youderian
Post by Andrew Youderian
Andrew is the founder of eCommerceFuel and has been building eCommerce businesses ever since gleefully leaving the corporate world in 2008.  Join him and 1,000+ vetted 7- and 8-figure store owners inside the eCommerceFuel Community.

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