good morning. comingp next on msnbc's "your business," how does a costume store know in january what it should be buying when customers look for halloween costumes nine months later? the ceo of columbia sportswear passes on the important business lessons he's learned from his mom. that, plus what you need to know to get the proper mindset to successfully run a company. all that coming up next on "your business."

hi, everyone. i'm j.j. ramberg, and welcome to "your business," where we help your small business survive, thrive, and grow. for most of us, halloween is a time to eat, drink, and be scary. but if you're running a business selling halloween merchandise, the scariest part of the season is how much money you laid out in january for stock that you can't sell until october. we met up with a phoenix based family business that's figured out how to buy inventory ten months ahead of sales and keep the scariest risks to a minimum.

>> i can't have a million dollar october if i don't spend a half million dollars in product. i mean, that's pretty, pretty much basic how it is. >> debbie easley is the owner of easleys fun shop in phoenix, arizona, and for her, the finances couldn't be simpler. >> my dad always told me that if you buy something for a dollar and can sell it for $2, you're good. >> what's not simple about her business is the need to order merchandise at the start of january that can't be sold until halloween at the end of october. >> it's all a guessing game. it's all kind of a crap shoot for us. >> since no one can know what will be popular so far ahead, placing orders like this can be extremely risky. that's why she calls it a crap shoot. >> they're talking about all these great costumes but you

know, what if the movie doesn't do well? then the new cartoon is coming out and what do you buy? it's really just, it's like, oh, my gosh, so overwhelming. >> so, how does she decide what to buy so far in advance, when even her customers may not know what they want until october, when they see it on her rack? >> there she is. >> so sizes are here. and then on the package as well. >> they'll come in and say i want to be lady gaga and end up going out as tina marie or somebody way off. >> wonder woman. >> '70s theme. >> the best part is that if someone says they don't like your costume, you can shoot them. >> in a store full of witches, ghosts, and goblins, you might wonder what scares debbie the most. >> our payables at the end of october are always real scary. >> it's this, all this unsold merchandise, ready to go. >> i've got a lot of backstock,

and wering in about 10,000 costumes just for the month of october to sell. >> walk through these aisles now in early october, add in another 12,000 accessories for a total of over 30,000 skews filling these racks, and you get the idea. >> i'm a hat girl. i always like, of course, you can't forget the nose. but again, going back to the novelties, you know, all the fun accessories. the horns, the flowers that squirt, you know, the big bow ties. >> it turns out while it's impossible to predict the future, last season's inventory is debbie's first defense for reducing the risk in selecting for next season. >> i usually come prepared with a reorder. okay, this is what i know sold. i want to reorder this. if i sold 25 halos last year, did we run out before christmas? maybe i should bump that up to 36. or did i have 12 left? okay, maybe i don't need that

many. and that way i don't have to dell on, oh, did i buy enough of, you know, capes and robes. i know i have that covered. i don't have to think about that. >> but debbie does think. she doesn't just blindly reorder everything that sold last year. she says the key is knowing when it sold, not if it sold. >> i've got, you know, eight different batman masks, okay. which one sold first? when i'm going down my list and it says i sold 12, i might have sold 12 the day before halloween because that's all that was left. so it looks like this was a good seller, but it wasn't because it sold last. >> next line of defense for cutting risk comes from tracking customer inquiries. >> i think you have to be out on the floor. you have to be with your customers and with the people that work here and listening to what people are asking for. >> probably the biggest thing right now is superheroes and witches, ghosts. >> ingrid greets the customers when they first arrive. and she asks them lots of

questions. >> kind of keep finding out what they like. ooh, you know, do they want to go old school, new school? pirates, they don't want just a pirate, they want to be a sexy pirate. you know, that looks like a pirate. >> i have a lot of interaction with the customers so i can kind of pinpoint what the majority of them like, and some of the taste buds is also pricing. pricing is very big. >> iris is another staffer debbie turns to for help in deciding what to buy. >> she's really in tune. she's like make sure you get the day of the dead stuff. you need these colors. you need, these are real popular characters that are happening in mexico. >> debbie says iris also discovered something surprising about this group. >> number one reason they come here is for makeup, even though it's more theater, a lot of hispanics now are doing it as street wear. and you know, it works out for them. they like it. it lasts longer. >> the gentleman that runs our makeup counter is -- he does

drag shows. so he knows the better wigs to buy, the eyelashes, the makeup. that kind of thing. >> another staffer debbie relies on is cocoa st. james. he tracks the changes in trends in inventory. >> i told her we need neons. she said, do we not have any. i'm like, no. she said okay, get some. we got some. >> no matter what you want, i say, mikey, buy whatever you want. because i know that the one thing mikey never wants to hear is, mikey, you bought that and it didn't sell. so it's a win-win for me. >> the final piece of this puzzle is the vendors themselves. debbie says they have often got her back. >> i trust my vendors. and they want me to stay in business, and they want me to make money. they want to see me succeed. so they're not going to dump stuff on me that they're not going to say, oh, buy this. it's great, if it's junk.

because if i go out of business, then what happens to them? >> while it's true that no one can predict the future, if you look at past sales history, your customers' questions, your sales staff intuition and vendors research, you stand a good chance of staying ahead of the curve. that's what's kept the easleys going for more than 60 years. and they hope it will keep things going for the next generation, too. that and keeping things fun. >> there's no greater joy than having some grumpy old guy come in the store and go, and have him leave going, look at me. i'm a pimp. and he's so happy. those are the kind of things we live for, that just make it so great, so fun, because the costume business is so fun. it really is. it's so much fun. >> some of us are naturals, for

others of us it is incredibly painful. no matter if you like it or not, networking is an important skill to have to grow your company. smart ceo.com has five ways you can effectively network at the next event on your calendar. one, be smart about where you network. your time is valuable. only go to events where there's an extremely high chance your ideal clients will attend. two, be intentional about how you work the room. strategically place yourself somewhere you have access to the people you would like to talk to and strike up meaningful conversations. three, dress to impress. wear nonthreatening but eye-catching colors. dress the way you want your brand represented to others. 4, stick around after the event. introduce yourself to the presenters and have your 30-second elevator pitch along with your business card on the ready. and five, follow up immediately with an e-mail. it's a good way to make sure you stay top of mind and keep the connection going.

>> if you're venturing out on a hiking expedition to see the fall foliage or taking the family camping at one of the national parks, chances are you have something in your suitcase from columbia sportswear company. people all over the world swear by the outdoor gear made by this family business, so we sat down with the third generation ceo, tim boyle, at their headquarters in oregon to get his top picks for entrepreneurial success. >> my dad died, the business was doing a million in volume. in 1971, the year i came on to help, it did a half a million. so our bank called our note and we tried to sell the business. and we weren't successful. the process of trying to sell the business was really my mba program. we would have potential buyers come to visit the company and

say why do you do things that way? wouldn't you be thinking you might want to do it this way? you can't overemphasize how much help you can get for free by just asking people to, you know, please think about my idea. talk to me about this. what advice can you give me? when we started developing our own products and the brand and really focusing on those kinds of points of differentiation that we could envision ourselves, we really started to become more successful. how do we make outerwear that's different? we came up with a concept of making interchangeable garm nlts. so we could zip the liner out, and that was a unique proposition where you could wear the liner and the shell separately. >> the liner zips in for maximum

warmth. >> then sort of maybe most importantly, we started marketing the company using my mom. >> a tough mother, that i don't mind. >> most people think she's an actress who is actually -- she is my mom, and her point of view and sense of humor and the way that that's been -- that's become the personality of the brand. these brands that we've acquired, including sorel and mountain hardware and prana, each have their own points of view and personality, and we want to make sure that those are free to grow and be as different from columbia as possible. we don't need to be buying another columbia. we need to be buying brands that can be very different and grow

and create their own points of differentiation and spots in the marketplace. you can't sit in an office building in london and design outdoor apparel that people find legitimate and authentic. we encourage the people who work here to go, hey, if you have a great idea for a product, let's make a prototype and take it out and see if it's going to work. you really can't ever stop working on the product. i mean, the products are great and hopefully they're cutting edge and work well, but you know, we can always improve, right? >> listen to this statistic. since 1990, returns to share holders in public companies where the founder is still involved are three times higher than other companies. which makes you wonder, what is it about having the founder

around that propels success long after the early days. our next guest has spent years researching this very topic and he's here to give us ideas on how to incorporate some of the founder mentality into our companies even if the founder is long gone. chris zook is a partner at bain and company and co-head of the firm's global strategy practice for 20 years. also the author of the book "founder's mentality." it's so good to see you. >> thank you so much for having me on. >> that statistic was so interesting to me, because as a founder myself, i get it. i care about my company so much. i understand what it means to have a founder around. >> the work for the founder is mentality we went to 40 countries and looked at almost 1,000 companies and hundreds of founders, and the statistic you quote is very important, i think, because what we find is something that's incredible to me. 85% of the barriers to growth of companies right now are internal. they're in their control. we found that the great founders

that create sustainable companies set their companies up in very specific ways in the first place, and that's really what our work was intended to do. it was trying to find lessons that any leader could take and use from the great founders. >> okay, so let's highlight a few of those lessons. i love this one, maintain a clear mission, because people talk about mission statements. people talk about having all hands meetings. it is amazing to me how many times you go into a company and nobody understands the mission. it's this much to the left or this much to the right, but that makes all the difference. >> absolutely. every founder begins wanting to be at war with their industry or create something tremendously new. and yet from then, things can become diluted. elon musk wanting to create a business that puts humans on mars. >> right. >> but even it can be your local restaurant which is linked to a farm that wants to provide the best organic experience for people, yet over time, what we

call the insurgent mission can become diluted. >> in that particular case, you might have someone working there who thinks, oh, our mission is to serve people food, which of course, is also a mission, but it's not. it's something bigger than that and easy to foregget that. >> it's absolutely easy to forget that. there's a couple things that are critical. keep your eye on the long term, not the short term. if you're a brick builder, you're building a cathedral, not an element of a wall. second is you have to have an insurgent mission that inspires. right now in america, only 13% of people say they have any emotional connection to their business or its purpose. >> 13%? >> if you do have such a connection, you are five times more likely to invest your own time in offering innovative ideas. >> of course. >> that's hugely powerful and it stems back to believing in an insurgent mission. >> you talk about this. you have to experiment with innovation, and part of that ability to innovate and create and try things is what gets people emotionally connected. >> you know, i was looking a little bit after the history of

facebook and how it took over y myspace, which used to have more viewers than anybody else. when you really drill into it, you find so much of that was a failure to listen to the customer and innovate, unlike what mark zuckerberg did with hack-a-thons at night. we were studying a company in china started by two brothers from a very poor area of rural china, and they're a competitor to walmart in the food area. they separated their company into red and green stores. the red ones are the core. they want to bring the freshest food to the chinese mother. but the green ones are run by somebody else, and they're trying every innovative idea. the ones that work they move into the red stores. you have to not stick by your formula, which companies like twitter may have done a little too mitch. you really have to be constantly pushing the boundaries. testing, getting your smartest people to say if we began again with a blank sheet of paper, what would we do? >> is that what you mean by concentrated on the front line? >> every founder is either the

first sales person, the first product developer, the person that turns on the lights in the morning. you know this as a founder of your own business. yet, as companies grow, power often shifts to people who have never served the customer and may never have been at the front line and made a product, and information becomes distorted. customers become numbers in market research reports and not names. >> everyone in the company should spend some time in customer service. i fully believe this. so good to see you. i think your book is so interesting, so right on, and i'm so happy to have gotten to meet you. >> thank you very much, j.j. last week, i had a birthday party for my 8-year-old son. and as i do after every one of these parties, i look at all the gifts from his friends and wonder, does this make sense. are gifts fun and i would take the fun away from him? is there another solution. turbs out i'm not the only apparent who goes through this. our elevator pitcher had the same question and she decided to

do something about it. now let's see wha our panel thinks of what she came up with. larry chang and janet kraus, who teached entrepreneurship at harvest business school and is ceo of peach. >> hi, janet and larry. i'm tanya. i formerly led digital products at nick jr.com and now i'm a founder. i started iso because my daughter told me for her ninth birthday, she didn't want more stuff. instead, she wanted help saving for an investment account and a bike. that's when i realized gift giving for young people needed a redesign. we enable to them to use birthdays holidays to save for goals instead of more goos in three main categories. save trg the future, sharing with others, and spending on things that matter to them. we already have thousands of users at isow.com and we're

building our our team and continuing to spread the word. lots of families this holiday season are looking for more meaningful ways to give gifts and we want them to know about isow. $130 billion was spent last year on gift cards alone. and there are 96 million users in our target mark so we know our success is yield returns up to ten times for our investors. thank you. >> nice job. thank you. i like that. well, let me give you these first. two numbers. between 1 and 10, the first is what do you think of the product? the second, what do you think of the pitch? i like that your child asked for money to invest. mine asked for a segway. i don't even know how he knows what a segway is. larry, let's start with you. >> for the product, i gave you an 8. i love the fact there's an authentic origin to the service you created. i love the fact you started with your past experience which gaves you credibility. there's a missional orientation to the business which makes me

file like you would make it through the long haul. in your pitch, i gave you a 10. i leave more excited or i'm not interested. i forget it the minute i left the elevator. i left more excited. you were clear, articulate. you hit some of the high points. you did a great job. >> nice job. janet, you're up. >> same. i gave you an 8 for your product. and you notice, i might have changed my 9 to a 10. your product sounds -- i have twins who are 9. this problem that you're solving, it's so important. it really is. it sets the groundwork for the way kids grow up. and we're also living in a pirps-driven economy now, and i think you're tapping into something that's really important. my one point would be you have to think about the fact you have two customers. the mom and the dad who get it, and the kids. you have to make this cult-like. like cooler than gifts in every regard. >> cooler than a segway. >> i might be wrong. i have to go look back on the tapes, but this may be the first double-10 we ever had on t

show. >> if so, if we had balloons, they would be coming down. congratulations. i will introduce my kids to it, and thank you both for your advice. really appreciate it. if you any of you have a product or service and you wand feedback from our pitch panel and your chances of getting interested investors, sengd us an e-mail. include a short summary of what your company does, how much money you're trying to raise and what you intend to do with that money. we really look forward to reading your pitches and seeing some of you on the show. >> still to come, can promotions cause your company more harm than good? and why a customer you know can help you make better business decisions. will your business be ready when growth presents itself? american express open cards can help you take on a new job,

or fill a big order or expand your office and take on whatever comes next. find out how american express cards and services can help prepare you for growth at open.com. just how aggressive do you use pricing promotions to help encourage growth for your company at an early stage? >> so pricing promotions are -- it is a very interesting tool. but it can end up being something that you get addicted to. so i think pricing promotions used properly will help you grow your business, but if you train your customer to only shop with you or to transact with you when

there is some kind of promotion, you're going to get yourself into a deadly spiral, i think. i would use it very carefully. judiciously. sometimes you need to sort of rev your business in a short-term, but long-term pricing promotion just puts you in another category of business completely. >> we now have the top two tips you need to know to help your small business grow. and larry and janet are back with us again. all right, here to pick your brains once more. you've been an entrepreneur, you've taught entrepreneurship. what is something you have learned help companies grow? >> so my tip for the day is to embrace the no. as entrepreneurs and business owners, we are totally optimistic. we're looking for people who are validating what we're doing. and i always say to people, when you hear someone say, maybe not, or this is the worst one, i know lots of people that would use that, when you think they're the target market, you want to lean

into that and be curious about what it is they're seeing that you're not seeing. you're going to learn so much more from unpacking the no than following the yes. >> it is so true. actually sometimes what i found in my own experiences, you're not explaining it well. no, no, no, that's never going to work. you think how in the world do you think it is not going to work and you realize -- sometimes it is just because you're wrong, but sometimes your pitch is wrong. >> it can be that. when you're curious and ask questions, the things that come back help you improve the pitch, the product, lots of things. >> so true. and you need those people to be on your side. so you need to figure out what is wrong or how you can say things differently or change the product. >> yep. >> great at advice. >> very complementary. surround yourself with people that have diverse opinions but common values, employees and partners and so forth. you want diverse opinions because it leads to better decision-making. not a single person or perspective that can possibly capture all the issues you should be thinking about in your business. and so there is a natural

tendency to want to recruit people, but want to embrace diversity. you want common values. that's the fabric of your organization that will help you survive through the long haul. it is things like what it does it mean to treat a customer right, to do the right thing, to be loyal. those are the intangibles that keep a company together. >> the second part is if you have a company of diverse opinions, you also have to be willing to listen to them. right? i think we probably have all found ourselves discounting something someone says because it is not the same. you have to check yourself and say, no, wait, take a deep breath, listen to what they have to say with an open mind, and then decide. >> diversity is easy when everyone agrees. >> absolutely. so funny. >> as my mother always said, two ears and one mouth for a reason, listen more than you speak. >> time for our small biz tools.

we asked our viewers to send the most helpful websites and apps and technology so you can give them a try. >> so one website i use consistently in my practice is called my case. my case is a law firm management website, it is completely cloud based and allows me to manage documents for my law firm, billing for my clients as well as production and resource development for my client. >> one aspect helpful for me running my business is called opius. it is a calendar and plan we ne with notes. it is helpful if you have an iphone or android. >> we have intercom. it is a chat feature we embed on our website. and we can get real time updates and questions and inbound inquiries from potential partners and clients. it goes to all of the cell phones of all of the guys on the team should we want. we can interact with users we have on boarded to send out

bound e-mails, automate updates as they hit certain milestones through our platform and get feedback for where they are in the process and what they might need help with. phenomenal real time and i recommend it for anybody. >> one of the applications i use all the time is gate guru. you're at an airport, you can get information on all the different restaurants and events that are occurring at that particular airport. so when you're sitting there waiting, you know where you can go, get something good to eat. >> this week's your biz selfie goes from james moore. he owns a small electrical service company. i love that logo. great picture. thank you, james, for sending it in. now, all of you out there, pick up your cell phone, take a selfie of you and your business and send it to yourbusiness@msnbc.com or tweet it to @msnbcyourbiz. include the name, the name of your business and location.

#yourbizselfie. thank you for joining us today. we would love to hear from you. if you have any questions or comments about the show, e-mail us at yourbusiness@msnbc.com. head over to our website, openforum.com/yourbusiness. we posted all the segments from today, and a whole lot more. you can also connect with us on all of our digital and social media platforms as well. we look forward to seeing you next time. until then, i'm j.j. ramberg. remember, we make your business, our business. will your business be ready when growth presents itself? american express open cards can help you take on a new job, or fill a big order

or expand your office and take on whatever comes next. find out how american express cards and services can help prepare you for growth at open.com. donald trump's new opponent, democracy. >> i will totally accept the results if i win. >> attacking the integrity of the election, while insulting his opponent. >> such a nasty woman. >> is trump trying to win or lay the ground work for his own tv network? one on one with the trump senior adviser. plus, the rhetoric of a demagogue and the lessons for today. >> we're trying to rig the election. >> the media is trying to rig the election. >> the election, just 16 days