How Do You Get From $375 to $10 Million? “Just Do It”Rieva Lesonsky
How do you parlay $375 in startup capital into a business that projects $8 million to $10 million in 2014 sales? For Yosef Martin, founder of Merchandize Liquidators, the answer is focus, dedication and hard work—not to mention “a few years of eating rice and ketchup.”
Merchandize Liquidators works with manufacturers and high-end department stores to buy overstock merchandise and sell it in bulk to retailers worldwide. Today, Martin’s business boasts a Miami Gardens, Florida, warehouse, 18 employees and three straight years on the Inc. 500 list. But it wasn’t always this way. Martin’s success story is full of “smart hustle.”
Martin started the company in 2003, while working on his business degree at Florida International University. Aware that the Internet was changing the future of retailing and that brick-and-mortar stores would become less important as ecommerce grew, he spent a year testing online business ideas, including selling products on eBay and Amazon. But as an international student who had to keep his grades up or lose his student status, he had little spare time—and even less money—to spend on his startup. Selling one item at a time took far too long, and profit margins were low. Instead, Martin decided to buy surplus inventory from department stores and sell it in bulk. “I thought, why not sell a truckload at a time and make it a real business?”
To attract the attention of potential sources and customers, Martin taught himself HTML and set up a business website. “I’d look at sites I liked, go to the source code page and figure out how to make my site look like that.” He also spent long hours avidly studying the ins and outs of search engine optimization (SEO) tactics. “I’d work until I fell asleep at 3 a.m., then wake up at 8 a.m. to go to classes,” he recalls. But success took trial and error, and many lessons had to be learned the hard way. For example, losing $150 of his $375 investment in a pay-per-click campaign that didn’t work was a major blow for Martin.[content field=”callout1″ format=”true” class=”calloutyellow”] Martin had used up all his savings, and owed $7,800 for the upcoming semester’s tuition, when he made his first big sale. “I signed a contract with Federated [Stores] and paid my tuition. That’s when I knew I could really grow this business. From there on out, everything else was just a small obstacle.”
Business really started picking up when Martin learned how to optimize his site on Google. He began getting lots of replies from companies he contacted. However, moving out of his apartment and into his first commercial location in 2005 required a new type of hustle. “Managing people was my biggest challenge,” recalls Martin, who has learned to select employees carefully and quickly let go of those who don’t fit.
He also learned the importance of focusing on the big picture. “My business was growing, and I wanted to get more exposure and clientele,” he recalls. “I got really good at SEO, but I also got too obsessed with ‘What is my position on Google today?’ I was so focused on marketing that I neglected managing. It took me a few years to leverage and prioritize what’s most important. Optimizing your site on Google is one thing; making a business go is another. SEO will only take you so far—making the effort to get stronger contracts is what really matters.”
True to Smart Hustler style, Martin built his business entirely by bootstrapping; he’s never obtained outside financing (other than a line of credit that he’s never actually used). Today, the business sells to companies all over the world, including Latin America and the Caribbean. Already, 80 percent of his sales are international, and Martin is working on breaking down tariff barriers so he can expand to even more international markets in the coming years.
But Merchandize Liquidators isn’t the only iron Martin has in the fire. As a true Smart Hustler, he’s also involved in several other businesses. He’s the CEO of Boxycharm, a monthly beauty product subscription service. Founded in 2013, the company is growing by 35 percent per month.