I’ve shared a few personal stories here over the last few months and this article is going to be no different. If you’ve ever heard me speak you’ve heard me talk about growing up in a log cabin in a small town in Ripley Maine, a population about 450 people.
What you don’t know is that literally next door to that town is the town I went to high school, Dexter Maine, population around 3500. Dexter Maine back then was known, for one thing, Dexter Shoes. If you are maybe 30 something 40 something years old, you may have heard of Dexter Shoes. The company existed for over 30 years in that small little town and closed its doors in Maine in 2001. Local people from that town have said when Dexter Shoe left the town pretty much died. What can we learn from Dexter Shoes now? Keep reading for more.
At the height of their popularity, Dexter Shoes manufactured more than 36000 pairs of shoes a day at the top production level. Dexter Shoes had 80 retail stores and more than 250 million dollars in sales each year. In 1993 the proprietor of Dexter Shoes sold his company to Warren Buffett. Warren Buffett merged the company with his shoe company, HH Brown. In 2008, Warren Buffett said that the acquisition and subsequent merger of Dexter Shoe was the worst decision he ever made.
Now, what can we learn from this?
The town of Dexter Maine put all their shoes…er eggs if you will in one basket. They put them in Dexter Shoe. My father worked in the Dexter Shoe Factory (or shoe shop as the locals called it) for years. He hated the job. That’s why I absolutely love what I do every day. My father instilled in me that you shouldn’t work at a job you hate.
Now Dexter Maine the town still exists. Ironically enough, the population is still pretty much the same. However, the town vibe is completely different. The town’s identity has completely reversed itself as they banked everything on one industry: Shoes. The lesson learned here: Do not put all your eggs in one basket.
Your marketing, your sales, your resources… do not put them all in one basket because if you do, and that investment goes south, so will you and your business.
Diversifying your efforts can be a great thing, as long as everyone knows their role and what their contributions must be to your team and company. Those that don’t diversify and stay ahead of the curve of the competition will end up going the way of the dodo bird. Or, if they do exist today like Dexter Maine still does, they will end up with a completely different looking business than what it once was. The choice is yours. You can evolve, or you can become extinct. Choose wisely.