Organizers Direct: Neil Balter’s New Gig

Posted: 11/14/2011 9:29AM

 

Neil Balter. If his name doesn’t ring a bell, his business achievements will. Balter started California Closets, and with it essentially launched the retail category of home organization services companies. Now he’s ready to light the fuse on a major expansion of his latest venture: Organizers Direct.

Balter began his first closets business in 1978. At the age of 17, while still a part-time student at Pierce College in Los Angeles, he founded California Closets. The company grew from his dad’s garage into the world’s largest custom closet company. In just under a decade, Balter expanded California Closets until it encompassed over 700 employees, 100 franchises in the United States, Canada, Japan, Australia, New Zealand and Spain, with annual sales in excess of $66 million. In 1990, just before turning 30, Neil negotiated the multi-million dollar sale of the company to Williams-Sonoma, Inc. for a reported $11 million.

From there, Balter took a few years outside the closets business, eventually signing on with ClosetMaid to grow its dealer network. But Balter’s entrepreneurial urge persisted, and he launched Organizers Direct in 1995. His noncompete clause had expired with California Closets, but his involvement with ClosetMaid placed some constraints on this new business.

Now, after 10 years with ClosetMaid, his engagement is completed, and Balter is free to bring Organizers Direct to market as his latest offering for operating a home organization business. “We’re now ready,” says Balter. “I really believe that in my heart of hearts.”

Pushing Marketing, Not Manufacturing

Based in Scottsdale, AZ, Balter says he is distilling into Organizers Direct the lessons learned and best practices drawn from his background. Balter’s basic target is independent closets businesses that could use marketing and manufacturing support, as well as people who want to get started in the business. With Organizers Direct, Balter offers support to help owners grow their business, and their margins. Balter believes that to a large extent, closets products, from melamine panels to functional and decorative hardware, are supplied to most of the market from the same limited number of sources. Given that, Balter contends it is a better business strategy for closets firms to outsource production.

“They focus on the wrong thing,” he says. “They should be concentrating on new customer lead generation and closing rates.” Balter notes that a sales lead can cost as much as $250. So it behooves home organization businesses to concentrate on improving their success rate in closing sales. By concentrating on marketing and sales, says Balter, dealers can improve closing rates from 40 percent to 60 percent.

“We provide the support for the independent shops, who are just out there, all alone,” he says. In addition to handling the manufacturing, Organizers Direct provides turnkey systems for developing sales and marketing. Balter’s bonafides at California Closets and ClosetMaid gives him plenty of credibility in making this case.

Balter also suggests, as with manufacturing, that showrooms are a costly burden for a small home organization business. He advises his dealer network, which now numbers 150, to forego the showroom and concentrate on going to the clients’ homes. “We’re an in-home sale,” says Balter. “They have to go there anyway to take the measurements. Why not start out the sales process there?”

Dealers do not have territorial exclusivity, Balter says, a structure he built into Organizers Direct from his background with California Closets. With protected territories, he says, “If someone is not producing sales, then you are stuck.” Balter adds that if a dealer is productive, he will not place another Organizers Direct location in the area.

Organizers Direct provides over 5,100 SKUs in stock, so hardware and components, even rarely used items, are ready to ship. “This is where we shine,” he says. Drawing on his experience, Balter notes one stumbling block to executing home organization projects is missing components.

On the design side, Organizers Direct integrates its operation to the well-established closets application LiveStorage 3D design tools from Renton, WA, CHI-llc. (LiveStorage. chi-llc.com). Organizers Direct dealers receive a discount on the application. Balter appears in a YouTube video testimony for LiveStorage on behalf of the program.

A collateral package sent to prospective dealers of the Organizers Direct lines includes direct marketing materials, production pricing, shipping lead times of the major lines, freight costs, a beautifully printed 24-page catalog, and a lifetime warranty card. “If a product ever fails during normal use, we will replace it free of charge. Period,” reads the warranty.

Materials are customized to include both the Organizers Direct brand as well as the dealers’. “Everything we do is co-branded,” says Balter.

In his career, Balter has been the high-profile go-to guy for closet expertise and commentary. He has been well chronicled in the media. And he was recognized in Entrepreneur Magazine with an Outstanding Entrepreneur Achievement Award and featured in The Wall Street Journal, Forbes, People and was a regular guest on the “Oprah Winfrey Show” and other home talk shows.

Author and speaker

Balter’s 288-page book, The Closet Entrepreneur: 337 Ways to Start Your Successful Business With Little or No Money was published in 1994. And he is also featured in a current book by business author Ken McElroy, The Sleeping Giant: Take Charge of Your Future, examining the stories of 20 entrepreneurs. Chapter 5 is devoted to Balter. A founding member of the Young Entrepreneurs’ Organization and a business speaker (he addressed Closets Expo in 2006), in some respects, Balter is to closets what Starbucks is to coffee, or Apple is to touchpad computers: He is a category creator.

Related:
Closets Source Organizers Direct Eyes Expansion


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stevenak    
PGH  |  November, 20, 2011 at 03:17 PM

OK--If Balter started the company----who is Michael DeHart?

 

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