Advanced: "I don't know that the name explains us that well," Christopher says. "People ask, 'What does it mean?' Often they think we're a catering company. But any conversation that's evoked based on the name is good."
Although the Pampered Chef logo appears on the items' packaging, products are usually delivered under the manufacturer's brand name with "some sort of something on it" from TPC -- a use-and-care brochure or a recipe leaflet. Christopher believes customers value information more than brand names.
3. Purchasing
101: To stock up, Christopher visited the showroom of every kitchen-product wholesaler at Chicago's Merchandise Mart. Some suspected she was trying to buy the stuff at a deep discount merely for home use, but all agreed to sell -- cash up front. Christopher bought a dozen each of about 70 products. To reassure the dubious, "I reordered quickly," she says.
"Everything that could be deemed profit went into growing the business -- buying that dozen of everything, then two dozen, then four, and finally a gross -- to keep the inventory in supply. It was simple: cash up front."
Advanced: "After six months of my paying the bills, suppliers would tell me, 'We'll give you four dozen of these -- 30 days." says Christopher.
A salesman for a supplier Christopher used in the early days once called on her at home. Several years later at a trade show, Christopher bumped into him. "When I sat at your kitchen table," the gentleman confessed, "I kept asking myself, 'Why am I wasting my time here?"
No matter, Christopher responded with sympathy. TPC had long since zoomed past his and other distributors' ability to stock enough to fill her orders.
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4. Pricing
101: "I was a force of one when I started, so I literally could come back from a kitchen show, total what I had sold that night, look up my costs, and realize, 'Uh-oh, I miscalculated here, I need to change something.' A mistake wasn't millions of dollars, it was $75."
Advanced: Christopher has stuck with her basic pricing formula: take the amount you pay for an item and multiply it by two.
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5. Building a Sales Force
101: In May 1981 a friend begged Christopher to hire her as a part-timer in the field. "I only want to earn a little income," the friend pleaded. "I'll have to think about it," Christopher hedged. What she really had to think about was "whether there was enough revenue to pay someone else. I wasn't taking a salary, and I was reinvesting everything in inventory and packing materials and those kinds of things."
The friend "earned a little income" so well that Christopher took on 12 more associates by year's end. And that's when business complications set in. "Not only did I have to tally what I sold, but also what Kim and Linda and Cheryl sold," she says.
Worse, despite the business's increased volume, between what her compensation plan awarded to the seller and to the hostess, "there was no profit."
Advanced: Christopher required each new field person to pay $250 for a starter kit of products but offered to carry half the fee against future commissions. That approach was "a miserable failure": uncomfortable with overhanging debt, aspirants grew weary of owing and quit. Christopher tried other setups for part-timers and came up with one that made "a huge difference." For just $100, a new salesperson got a smaller kit. This time it was paid for up front in cash, no credit.
Unlike some in-home retailers, Christopher doesn't actively promote field sales as a business investment, although since salespeople put $100 down, in a microentrepreneurial sense it is. A field salesperson earns 20% of sales to start and gets 2% more when she passes $15,000. The field is about 99% female because, Christopher says, "it's grown through one person sharing it with another, and women tend to share it more with other women."
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6. Training
101: "My total experience in direct selling was as the host of a Rubbermaid party."
Advanced: An ingredient of TPC's success, Christopher contends, is that "everyone has been trained by someone." That's accomplished by TPC's field managers, upper-echelon veterans who recruit and supervise underlings. The novices attend kitchen shows to study their mentors' techniques. Tapes and printed materials reinforce the experience.
In 1994 TPC introduced audiocassettes. Christopher's saleswomen drive kids around more than they than watch TV, she realized, so listening to tapes in transit is a more efficient learning mode. And, at a scant $6 each, tapes are cheap to produce.
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7. Communication
101: TPC emerged from the basement into conventional commerce in 1984. Its first building was a two-story office-cum-apartment. It didn't do the trick for long. "We were growing so rapidly," she recalls, "that we'd get into a building that seemed huge when we moved in, and two years later we were bursting at the seams." She annexed a companion structure and apportioned expansion between them, repeating that strategy three times. For three years TPC functioned with two separately housed sets of employees, one recognizing neither the faces nor the jobs of the other. "It was like this building versus the other," she says with regret.
