In 2021, Memphis Tennessee’s Amro Music will be celebrating its centennial. It is rare for a company to survive ten decades. Less than 50 percent of U.S. firms are over 100 years old. To get a taste of Amro’s secret sauce, you need to dig below the surface, where you’ll find some hints. I recently had this opportunity when Mr. Averwater agreed to be my guest on “The Sound of Money Live” which premiered on June 16 (fb.com/mmrmagazine), and which I hosted.
For those who are connected to the NAMM community, Chip Averwater needs no introduction. If you need a memory-jogger, here it is: Averwater is past chairman of Amro Music and part ofthe third-generation of Amro Averwater retailers. He’s also a former chairman of NAMM, a frequent keynote speaker on music education and retail, and author of Retail Truths.
Although Retail Truths was published in 2012, this book provides a complete “how to” roadmap for your post-COVID playbook. Just add “Health” and “Safety” as additional factors to address and you’ll be all set.
What prompted a recent re-read for me was the term Averwater used for his subtitle: “The Unconventional Wisdom of Retailing.” Unconventional wisdom often means fresh insights or out-of-the-box thinking. What makes this unconventional for Averwater is the belief that retailers do best when they directly learn practical insights and techniques on the frontline. He says: “Negotiating with suppliers, choosing among job applicants, setting profitable prices, resolving employee disputes, sending messages to competitors, designing motivational incentive plans, firing employees, attracting bankers. We learn these one-at-a-time, in the trenches, under-fire, and with considerable costs and consequences.”
Chip Averwater possesses a unique collection of leadership qualities. Here’s his short-list:
Modesty: The original bio Averwater sent me was clearly understated. I had to go back to him a few times and ask, “Can I use this? …and what about this?” I think he finally acquiesced only because of my persistence.
Focus: Chip believes we can do one thing (or a few things) well, but we can’t do everything well. Decide what you want to do, and do it profitably.
Trust: “I think you have to assume the best about people. Make them prove you’re right or wrong. Act like you want them to become. If you think you have a good person, usually they will live up to that trust.”
Patience: “I remember I had an employee who came to my office one time, and she was shaking. She said, ‘I’m afraid you’re going to lose your patience.’” Chip asked if she ever heard him lose his patience. She said, “Yes, two years ago, I heard you speaking with an employee and you lost your patience.” He laughed when he told me this story, saying you slip up once, and your team will find out.
Innovation: I was curious how Averwater promotes a culture of innovation, so I asked him. He and his team came up with an idea to better engage Amro’s band directors so a Board of Directors was created. “We would invite a half-dozen band directors to lunch, and they would come back with great ideas that we didn’t know.”
Training: With passion, Averwater talks about the extraordinary skills required to become a world-class sales professional. The salesperson has literally a few seconds to transition the conversation into a relationship, through caring and active listening. He told me that the sales profession is one of the most unappreciated skills, requiring relationship development, product expertise, genuine caring, and powerful listening skills: “A successful sales professional has a lot of skills, and they deserve to get paid well.”
I asked Chip Averwater what some of the biggest mistakes retailers make are. He said, “One of the biggest mistakes is trying to do too many things. We can’t do everything well. It’s kind of like juggling plates. If we are juggling more than we can handle, we will start dropping one or two.”
Averwater said the second biggest mistake retailers make is opening too many stores. For example, let’s say you have two stores: “The second store is never as profitable as the first store.”
He calls this “the diffusions of efficiency.” The further you get away from the store, the less efficient it becomes. One day you realize you have so many stores, you are no longer making a profit.
Chip Averwater’s brother Pat is Amro’s current chairman and the baton has already been passed to the fourth generation of Amro Averwaters. C.J. (Chip’s son) is president and Nick (Pat’s son) is band department manager. With two grandchildren tuning up, the fifth generation is well positioned to debut their own symphony. You can view the entire conversation on fb.com/mmrmagazine/videos.
Jaimie Blackman — a former music educator & retailer— is co-founder of BH Wealth Management. The organization offers financial advice, insurance and succession planning services. Jaimie hosts The Sound of Money Live presented by MMR. Discover how much risk is in your portfolio. Visit bhwealth.com/riskvideo. Registered Representative, First Allied Securities, Inc. Member FINRA/SIPC.
