A Bigger Wheel

He still didn't know whether he "wanted to make the financial commitment to enter this market in a big way," he recalls. And then he met with George Kling.

Moving to the next level
Kling was a local consultant whose stock-in-trade was introducing companies into the premiums and incentives markets; Zane had first met him in 1992 at a trade show. Back then Kling was offering, for $500, a daylong primer on the industry, which Zane opted not to sign up for. "I didn't understand the value of what he could give me," says Zane. "I didn't want to spend the money."

But by 1998, Zane had begun to wonder if there was more to the business than he was seeing, so he called Kling, who also lived in Branford. "It was the best $500 I've ever spent," says Zane. "I thought I understood the business, but I really had no clue." Kling laid out all the ways in which the same product could be brought to market -- through promotional agencies, advertising companies, incentives catalogs, supermarket syndicators, and premiums representatives. "When he came to me, he was convinced there was a pot of gold somewhere, but he just didn't know how to get to it," recalls Kling, whose clients have included AT&T, Crabtree & Evelyn, Gillette, and Izod Lacoste. "I tell many more companies to stay out of this business than I encourage to go into it," he adds, "but when I saw what Chris had to offer, I felt he could be successful." When Kling told him just how big the pot of gold was, it didn't take long for Zane to do the math. Premiums and incentives were a $23-billion market, while retail bicycles weighed in at just $2.5 billion.

But if the meeting with Kling whetted Zane's appetite, it also provoked intense anxiety. It became painfully obvious to Zane that although the new market offered tremendous potential for growth, it also required money, patience, and professional guidance. Accustomed to running his business on his own, Zane was a pathological micromanager, and he didn't relish giving up control. "I hemmed and hawed," he recalls. "George wanted a $60,000 retainer to advise me, I was going to have to increase my facility, and we were looking at a long gestation period -- maybe six months until we got an order." Zane's wife, Kathleen, reminded him that he had lost much more than $60,000 when the business was far smaller and less profitable, and she encouraged him to take the risk. "So I rolled the dice," says Zane. "And it was a lucky roll."

Within five weeks of hiring Kling, Zane had 16 premiums representatives nationwide. Reps are usually loath to take on new clients for fear that a new company's less-than-perfect service will damage their reputations. But Kling's word was as good as gold in the industry. "For what we paid him in fees, we jumped five years in the business," says Zane. "Without him, we probably wouldn't have survived."

With a marketing machine in motion, Zane needed to make significant changes at the shop itself. "We made a real commitment to the business model," says Ken Zane. "We had to find a new facility, hire and train help, and develop the operating and control systems needed to deliver products." Less than a mile from the shop, Chris Zane found an 18,000-square-foot warehouse and charged his brother with transforming it into an assembly and distribution center. "The thing that's different about the premiums market is that it's systems driven," notes Chris. "In a retail environment, your people do whatever it takes to make a sale, and there's a lot of creativity involved. You aren't focused on process. In the corporate market, you just have to get the job done." Ken, who had spent his share of time assembling bicycles, taught his system to eight new employees, cross-trained them, and set up an assembly line in which three employees built, quality checked, and then disassembled every product.

"For years I had my hands in every aspect of the business," says Chris Zane. "I'm a better manager now."

As his company grew more complex, it became clear to Chris that he could no longer afford to micromanage -- a trait of his that, in fact, his staff viewed as increasingly irritating. His brother notes that "as the organization grew there was more on Chris's plate, and things would occasionally slip through the cracks." Chris agrees, acknowledging that he sometimes let orders for parts sit on his desk for days. Tom Girard, who has been with Zane for eight years, says that "for quite some time, he had his fingers in the pie too much. Once in a while, he'd come out and throw a wrench in the gears for no reason, just because he had to get his hands in it. Then we'd have to fix the bike all over again." Girard, now the company's retail manager, says that Zane is now forced to concentrate on marketing, leaving Girard alone to do what he does best -- manage the store and the employees. "For 16 years I had my hands in every single aspect of the business," says Zane. "But I'm a better manager now. I have to let the system be handled by my staff so that I can stay focused on opportunities that come up."

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