By Michelle Wu
As a child, shopping was a magical experience for Maxine Clark, founder of Build-A-Bear Workshop Inc. When she grew up, she pursued a career in retail, starting as an executive trainee at a large department store and working her way into management. By 1992, she was president of Payless ShoeSource Inc., the discount footwear chain. But it wasn't the dream job she'd imagined, and in 1996 she set out to blaze her own path in retail with the goal of recreating that special feeling from her childhood. The result was a business that invites consumers to build their own teddy bears, complete with stuffing and decorative trimmings. Today, there are more than 400 Build-A-Bear Workshop stores world-wide, about 15% of which are franchises located overseas. The St. Louis, Mo., company has 1,200 full-time and 4,300 part-time employees, and last year it posted $401 million in revenue. Ms. Clark, age 62, continues as its chairman and chief executive.
Q. Tell me about Build-A-Bear's atypical business concept.
A. In retail, people worry about transactions, when they really ought to worry about interactions. I wanted to create interactions with guests that turned into transactions. Build-A-Bear is a place for children to not just buy a stuffed animal off the shelf, but create one by dressing it, giving it a name and eventually playing with it online. They're giving it life.
A. It was 1996 and everyone was investing in Internet businesses. I thought: People aren't going to just want to buy online -- they're also going to want to do things in real stores. I was introduced to quite a few investors, but nobody wanted to invest in a brick-and-mortar concept. So, I decided to put my money where my mouth is. The first couple million was my own.
Q. You quickly raised more than $30 million in venture capital and private funding. What was your strategy?
A. Our biggest challenge was convincing people that it wasn't a fad, that this could be a successful business. When [raising money], you're talking often times to a lot of very serious people, and mostly men. They didn't necessarily get how attached their children are to their stuffed animals or how important the human connection is in retail. I had to convince them that this was a really viable business idea. A lot of our investors, over time, told me that the reason they invested in Build-A-Bear was because they asked their kids….and their children or grandchildren loved it.
Q. How did your early experience in retail help you as an entrepreneur?
A. I developed a lot of industry contacts and learned a lot about store operations, merchandising and marketing. And I knew that I didn't have to know it all, that I could depend on other people. If I needed help with customs and factory inspections, all I had to do was make a phone call.
Q. Did you set out to become big from the start?
A. I wrote a 10-year business plan for 300 stores in North America. And we have 300 stores in North America. We had a lot of support from the landlords that we worked with at the malls. They were very interested in supporting us and helping us grow because they saw how much business we could do and the quality of the customers that we brought in.
Q. How was the business affected by the recession?
A. We had to adjust our pricing and our promotional strategy. Up until 2009, we never had a sale at Build-A-Bear Workshop -- ever. But now we have sales that we've injected into our marketing plan and more coupons.
Q. You became an entrepreneur for the first time at age 48. What was it like to finally be your own boss?
A. You are never your own boss. The customers are really in charge. If you're in a retail or consumer-facing business, that's who's in charge, and that's always been the case for me. Even when you work for a large company, the people that you answer to are your customers.
Q. Kids go through fads fast. How do you keep them interested in Build-A-Bear?
A. The teddy bear has sort of been a quintessential symbol for love, trust, security and cuddliness. But you always want to make it relevant, so if skinny jeans or jeggings are popular, our bears can wear that. We also stay up with popular culture. In the summer, we'll be tying into the new Smurfs movie. We'll have make-your-own Smurf.
Q. What advice do you have for aspiring entrepreneurs?
A. The first person you've got to convince you want to do this is yourself. You have to believe in what you're doing. The money is next. Being an entrepreneur is a 24/7 job, and it doesn't get any better.
