Starting with a $1,000 Credit Card: The Hard Road Leads 3 Brothers to KC Business SuccessDavid Cawthon
When Kansas City entrepreneurs Ivan Guizar and his brothers Romero and Jamie started Evergreen Flooring in 2007, all they had was an idea, some determination and a credit card with a $1,000 limit. It was tough for them to even source the materials they needed for flooring installations.
“The first flooring mill we tried to buy carpet and vinyl from had sent a guy to view our showroom, and he gave us an application but never even approved us because he thought we would never make it,” Ivan said.
So instead of going directly to a flooring mill, Evergreen had to start as a middleman, buying extra leftovers from other suppliers.
At that time, they would end up going through a single roll of carpet in three weeks. Today, after several years of over 100 percent growth, they go through about 14 rolls a day.
Just getting started
Ivan came to the United States in 1993 and started working in Oakland, California, before moving to Kansas City to join his younger brother Jaime who had been installer of the month for seven straight months for another flooring company.
They soon caught the entrepreneurial bug and decided to open their first business. But it wasn’t in flooring, but food. Unfortunately, the profit margins for restaurants are notoriously low, and that culinary venture didn’t end up working out. So the three brothers then teamed up to start a flooring company with that credit card that gave them $1,000 in “seed capital.”
Unfortunately, they weren’t aware of organizations like AltCap or Justine PETERSEN that could connect them with funding or the bevvy of chambers and economic development corporations that support entrepreneurs with their particular need. (A good route, dear reader, if you’re thinking about starting your own business. Here’s how you can get connected to the right help (for free), right when you need it.)
Ivan took on administrative side while Jaime oversaw the measurements and quality control. Romero, who built a computer by himself at the age of 14 handled the tech side of the operation.
Their first job was a $975 install for an acquaintance, which is often the easiest way to get your first job for any sort of entrepreneurial venture. Unfortunately, as they found out, you very quickly run out of friends and acquaintances and have to start actually getting business from strangers. So, they began to look for new customers by marketing to what they say were the “ugliest apartments in the neighborhood” as those owners would likely be interested in upgrading their units.
This idea, while good in concept, turned out to be a mistake in practice.
They landed their first relatively large client in 2009. The company owned three different rundown apartments that began using Evergreen exclusively for their flooring needs. At this time, Ivan, Jaimie and Romero were running themselves ragged. They worked from 8 a.m. to 5 p.m. in the office taking orders, talking to customers and looking for new clients and the like. Then, between 5:30 p.m. and 2 a.m., they would do the installations.
Business lessons in trust
Regrettably, as many entrepreneurs soon learn, you can only be so trusting. Back then, they were afraid of losing their main client, so they let that customer run up way too much credit.
“I was afraid to ask for money,” Ivan says.
It’s a common mistake. You have to be willing to “fire a client” and never be so reliant a single customer that you aren’t willing to stick by your policies. Indeed, the willingness to turn down the wrong kind of business or customer is extremely difficult for entrepreneurs in the early going and is one of the first lessons you’ll learn in entrepreneurial education programs, like ScaleUP! Kansas City.
The owner ended up running up $40,000 on credit. Then, it became obvious why the client wasn’t paying the bills. The apartments were foreclosed, and Evergreen had to eat the entire $40,000.
“This was our lowest point, and we almost went under,” Ivan says. “But you have to be forward-looking. When you bump into a wall, you just have to jump over it.”
A formula for success
Slowly but surely, the company climbed its way out of the hole. The three entrepreneurs started to make a name for themselves with quick, high-quality service. They worked their processes down to a science—measure, bid, install, quality check—and followed it each and every time.
The three most important aspects of this process, other than price, were speed, reliability and quality.
For a long time, they prided themselves on next-day installations. This is a rather intense level of customer service, but eventually, they had to adjust. Even so, speedy installations are still a hallmark of their business.
The next key component is reliability. And to this point, Ivan prides himself on scheduling.
“I don’t ever screw up a schedule,” Ivan says.
This comes down to carefully scheduling each job, verifying every job by email so there is no miscommunication and keeping a long Rolodex of potential installers on call in case one leaves or doesn’t do the job correctly.
And then comes the quality check. “Trust but verify,” as they say. After every job is completed, a quality checker makes sure it was done correctly.
“You have to be fairly anal,” Ivan says, “because if you aren’t, the customer will be.”
And it’s infinitely better to hear a job wasn’t done right from the quality checker than from an angry client. On many occasions, Ivan and his crew had to send the installer back out to fix something or, in some cases, have another installer redo the job.
Growing up and bigger things ahead
The folk wisdom for business owners working with any contractor (or really, any client) is you can usually achieve deep success by focusing on two of these three things: price, quality and speed. Ivan says Evergreen aims to offer quick and high-quality installations but still remain competitive on price. This focus has allowed them to gain a loyal base of customers. So much so, that the business hasn’t taken out an advertisement in almost 10 years. All of their business comes from word-of-mouth.
In 2015, Evergreen moved into a new facility in Grain Valley, Missouri, and subsequently expanded that location in 2016, 2017 and again in 2018. Today, the now 36,000-square-foot facility holds thousands of yards of flooring with 22 types of carpet and eight types of vinyl. Evergreen does projects for everyone, from homeowners to large apartment complexes and has even started doing large projects outside of Kansas City. This includes one worth over a half million dollars alone.
With a dedication to quality and customer service, Ivan, Jaimie and Romero say they plan to continue expanding for some time to come. And they won’t need a credit card with a $1000 limit to do it.