Apr 1, 1985

Portrait Of A Compulsive Entrepreneur

 

"Exactly," smiles Harrell. "Now look at Procter's history. Their one great success formula is taking a product they can make some sort of claim for -- a slightly improved soap, a slightly better cookie -- charge more for it, and advertise the hell out of it. They do that up and down the aisles. But they don't do much in the refrigerated section. Nobody does, except Kraft. Take away what Kraft does, and the refrigerated case is the worst-managed, least-utilized product area in the supermarket. For any company with the money to master it, that case is the last frontier."

"Uh huh," agrees Dallas. "I'm with you so far."

"So here's what I'm thinking. I'm thinking Procter likes the juice business, but that's just the entry price to that cabinet. Once they're in there, they're gonna look down the shelf at an awful lot of pickle companies and tortilla makers waiting to be had. And when they move, the small guys won't know what hit 'em. Procter will either buy them up or roll over 'em like a tank."

"I doubt Procter has much interest in the rinky-dink stuff," counters Dallas, "but, yeah, they'll probably expand once they're in there. What's your point, Wilson?"

"The point is this," says Harrell. "If you're a small manufacturer sitting in that case, you had better plan to out-manage Procter, or as sure as I'm sitting here, you'll be refrigerated history." He waves a finger in the air. "Now, how do you do that? By organizing a national sales force? Forget it. Coupons and [in-store] promotions? Give me a break. No, your only hope is to use brokers more effectively, because they have direct access to, one, the local markets, and two, the top people, the heads of the chains. They can outdo Procter. But. . ."

". . . You have to know how to motivate 'em," Dallas chimes in.

"That's right," says Harrell quickly. "Forget this 30-day, I'll-fire-your-ass bullshit. Give them one-year contracts with built-in performance goals and stay the hell out of their way. Get brokers who'll hire housewives part-time to cover every store in their area, weekly at least. Use their contacts. Let them call the shots.You see what I'm getting at?"

"The small guy gets the shelf service he needs."

"And gives up almost nothing," nods Harrell, who by now is practically upside down in his armchair. "Give me 52 brokers across the country who can offer that kind of service, and I'll get them a hundred accounts [with companies] who'd rather fight Procter than fold." He sits upright and squints. "You interested, Del?"

"Could be," smiles Dallas. "I tell you, Wilson, you're a hell of an idea man. By the way, what handicap are you playing at these days?"

Driving home later, Harrell fields a question about his hip-shot analysis of P&G. "I happen to believe it with every morsel of my body," he confides, "but the fact is, it's the perception of what Procter's doing that's more important to me right now than the reality. Hell, this business is all perception. From packaging to marketing, it's a massive con game. Millions get wagered on what companies like Procter appear to be doing.

"And," he adds softly, "people who bet the right cards at the right time can make a ton of goddamn money."

Harrell's self-perception changed radically after the war. The shy Southern kid with a bookkeeper's aspirations became a chest-thumping cowboy riding high in the saddle of the American Dream. He bought the South Florida distributorship of a national firm selling simplified accounting systems to small businesses. Within two years, he was its national sales manager. He sold insurance for Aetna Life Insurance Co., and made the Million-Dollar Club his first year. He palled around with politicians and considered running for Miami's city commission. When the Korean conflict broke out, Harrell reenlisted and got sent to England, where he was handed responsibility for managing a string of U.S. officers clubs in the London area. After Korea, he divorced his first wife, took up with an Englishwoman (Daphne Mercer, who soon became the second Mrs. Harrell), and became a London-based food broker supplying military commissaries and post exchanges.

American companies marveled at the results. "I was so far removed from my sources [of production]," says Harrell of his crash course in the brokerage business, "that every screw-up was a three-month headache for me. I couldn't afford even the smallest problem. The Kraft product I was putting into the Munich-area commissary had better shelf dates than they had in Atlanta."

For nine years, Europe was his adopted home -- Great Britain, Germany, France -- but America was still the mother country, and in December 1959 he came home for good. The Harrell family settled in Connecticut; and Harrell International, the unbrella company, that would become the main marketing vehicle for 409, soon launched itself on an acquisition course every bit as impulsive and eccentric as its boss. While continuing to expand its overseas operations, Harrell's company bought up marinas, cattle ranches, giant-shrimp futures, you name it. In 1971, after the sale of 409, HI started collecting domestic brokerage businesses as well, eventually owning pieces of some 50 firms in all, a group it consolidated into 14 major brokerage firms. One of them, Horn-Harrell Inc., in Los Angeles, was practically an empire unto itself, with close to 30 principals and sales volume of more than $55 million in 1975. A couple of years later, Harrell decided to sell them all back to their principals. After what Jack Connolly describes as "a number of friendly meetings with brokers and lawyers swinging two-by-fours at Wilson's head and Wilson swinging right back," the deals were done.

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