If Harvard Business Review did a case study on TNG WORLDWIDE, readers would not believe the story. I lived through the story and still cannot believe it myself.
The coronavirus pandemic came and in a perfect world, this story would have never happened. But the world we live in has never been perfect and life is about dealing with each situation that is thrown at you. This is a true story on how I dealt with the coronavirus.
It was the fateful day, Tuesday, March 17 that I will remember for a very long time. That is when Governor Whitmer shut down the state. Three days later I would have a Zoom meeting with my employees announcing layoffs, pay cuts for salaried employees and store closures. It was a reminder of what happened in 2008-2009 but with much different ramifications.
Just a week earlier I was on the phone talking to doctors about N95 and KN95 masks. There was a tremendous shortage and they needed them. We sold 3-ply face masks for years, but not medical masks. That was the start of our transformation.
The rest of the transformation was expedited from my previous strategy that began in 1991, accelerated in 1997, and fast-tracked in 2015: Sell only TNG branded products. With the shutdown in place nationwide, only essential businesses were allowed to remain open. Due to the fact that TNG already manufactured many essential products, we were allowed to stay open. Products including hand sanitizer, EPA-registered disinfectants, hand soap, 99% IPA and face masks became hot items (and still are and always will be) and we made them all. Because of my relationship with my factories, together we were able to keep up with demand and stay in stock.
It was during this time that each morning around 2:30AM, lightening bolt thoughts would enter my mind and wake me up. These were new ideas scorching my mind and then I would wake up and put them into action. I’m not kidding, it was like living in a science-fiction movie for weeks (and truthfully, we are all living in a sci-fi movie right now).
With salons and spas closed, our business soared selling to first level providers. It was at this time that I truly understood my strategy all along was the right path and then one morning the lightning bolt told me to discontinue all third-party vendors. Not a single one stepped up to the plate to supply me essential products. In fact, none of them stepped up to the plate to supply any beauty distributor. In a crisis, you learn quickly who your real partners are. My customers already knew that TNG was the best company to work with, this only confirmed it.
At this time, I had another TNG employee meeting and this time, told those that we kept on everyone was back to work at full wages (even an incentive added for DC employees) and let’s rock forward. It was a great moment.
It was during this time that I also thought that I needed to transition THE INDUSTRY SOURCE to TNG WORLDWIDE and create a special platform for my most loyal customers. Voila! DIAMOND PARTNER membership was born. It was also the perfect time to update our logo and brand promise. No longer The Beauty Experts (although we always will be), but the new focus was on life’s essentials and comforts. Bam!
My focus then turned to additional essential items my customers needed. Fast forward to today, TNG is in stock on just about every single item, from Non-Contact Electronic Infrared Thermometers, to face shields to face masks to hand sanitizer and next week, touchless infrared dispensers for soap and hand sanitizer. It has been a non-stop whirlwind.
To get the word out to our customers, I created a series of Town Hall meetings to explain the transformation of the company and why we would no longer carry third-party brands such as CND, OPI, Nufree and others. It was in fact the very first meeting in which I was very passionate about my history growing up and how I got into this business and my ultimate pivot of my career.
It was also the meeting in which I was very passionate about the nail industry and I talked about the Vietnamese, how the first generation came to America to start nail salons, how hard they worked and even slept in them because they worked 24/7 and had nowhere else to go. It was then when I talked about the current state of affairs I said some stupid and insensitive things. Luckily, I was called out on it 10 days later and learned first-hand what it is like to be a total idiot and the happenstance when you screw up in social media. It was quite the humbling experience.
The great thing about America is freedom of speech. Another great thing about America is the ability to apologize publicly so you can move on without being prosecuted. I did a live video apologizing and then did a written apology. They say that good things come from bad and in this instance, it was so true. I never did business with Vietnamese salons, for more than 25 years I did business with Vietnamese distributors. This lesson taught me well but it also put me in touch with hundreds of Vietnamese nail techs and for that, I am very grateful.
The good news is that my next few Town Hall meetings went on without a hitch. Listen my loyal readers, I don’t know of any other CEO in the beauty business that has reached out to salons and spas like me and has assisted them not only with their PPE needs, answered hundreds of questions in regards to opening but also very vocal and direct with the direction that the new post-pandemic economy is going to take. If I never opened up, sure, my life lesson would not have happened, but in the end, history will show my passion for my customers comes first.
Last Thursday and Friday were two of my biggest days in business. Thursday, we opened America’s first PPE store, TNG WORLDWIDE COMPANY STORE. It was a grand celebration for our employees and customers. Every customer that entered was given a temperature check, good news is that everyone passed. Then they were given the choice of wearing nitrile gloves or using spray hand sanitizer and face mask (many had their own). And then they were free to shop. It was great to see their smiling faces (I could tell by their eyes) and seeing them buy everything they needed.
Thursday and Friday were the conversion of THE INDUSTRY SOURCE to TNG WORLWIDE and it was a monumental task that eventually went smoother than anticipated. It was all made possible because of our great web and support teams. It was the official transformation of the company!
One last note: We truly have the best employee team in the business. The demands over the past few weeks with air shipments, record number of orders and deliveries and working within the guidelines for safety and health have been tremendous. Yet through it all, we have had not one case of anyone being sick and not only that, everyone has forged even greater relationships with each other to make the customer experience and 100% customer success the best ever.
I want to close this chapter by saying thank you to my team, to my loyal customers, my loyal factories throughout the world, my BUB and everyone else that helped me and TNG through this transition. I cannot wait for salons and spas to reopen and most important, we are ready for business in the post-pandemic economy because of you.
Gloves. Nitrile. Latex. Vinyl. How did a commodity item that were recently selling as low as $2.99 box of 100 become America’s next crisis? Why isn’t the media all over this? Because the media is all over what is going on today and not what is going to go on tomorrow when businesses reopen.
Virtually every business that reopens will need gloves. But where are they going to buy them especially if they never bought them before? Let me explain to you because I am so f—–g busy right now, writing actually helps me to relax a bit.
First and foremost, think about the crisis going on right now. First line workers: Hospitals, ER, doctors, nurses, funeral home operators, police, fire. They all wear gloves and have always worn gloves. We take it for granted. Just like they wear face masks. Gloves were always part of their uniform, their profession. We expect gloves to be worn by these professionals.
But guess where gloves are made? China and Malaysia produce more than 90% of the world’s gloves.
Now I am not into politics on my blog as you know my loyal readers, and I am not going to start now. But the crisis we are entering is a Made In America crisis. In fact, every American right now should be thanking China each and every day for making gloves (and now masks) for America. Without China, there would be no gloves.
How did this happen? A combination of many things. Politics. Big business. The Save The Planet organizations and people behind this movement. Rules and regulations by the EPA, FDA, state and local governments. 3M, Kimberly-Clark, P&G and many other companies. People behind the MADE IN USA movement. The Big 3 are part of this. Hey, we are all part of this because we took something as simple as cheap gloves for granted. Now is the time to decide what is best for America’s future.
Here is the issue. Manufacturing gloves is not only hazardous, but the chemicals used in production are carcinogenic. The stack pipes in the sky spew out toxic gases. You have heard these same stories with manufacturing coal, tires and other toxic products. But gloves are especially bad. So bad, we cannot make them in the USA. So bad, no other countries want to make them. And they are so cheap, there is money to be made!
So if they are so bad you may ask, why do China and Malaysia make them? Good question. You can Google search the answer. Just think the word “pollution.” Just think about doing business globally and being a market leader at the same time.
So now you may ask, why can’t China and Malaysia just make more gloves? Another good question. China’s President Xi decided to tackle pollution in his country, most recently as the past 2-3 years. He wants China to become a world leader and set an example. When he makes a decision, the decision is final and carried out most efficiently.
Glove factories were on his list. Each and every glove factory was shut down by the government and had to install very expensive pollution and toxic chemical equipment to remove as much of the toxins as possible before opening back up. This cost the factories millions but they did it to stay in business. Also (I cannot confirm) the decision was made to not open additional factories without permits and most likely, there have been no new factories opened in the last two years. What does this mean? Global supply is limited to current factories output but demand is likely going to be 10 to 50 times more than that. In basic economics, supply and demand laws are at work.
TNG has a dedicated factory in China to produce its gloves, one reason why I know a bit about gloves. Most recent, TNG sold nitrile gloves $6.99 to $7.99 for box 100.
Since the crisis, market prices has risen to $11.99 to $19.99 for box 100. But this is today. This is before businesses even know they need gloves to reopen. This is before the media circus has started. Once this all happens, I predict market prices will surge to $29.99 to $79.99 box of 100.
Why do I think this? We sold Surgical 3-ply masks for years. We sold them for $3.49 a box. Today we are selling for $34.99 a box and cannot keep them in stock. That is 10X previous selling prices and they will go up again. We have containers on order for air and sea shipments and our customers are desperate for them. If gloves go up 10X, that would put a box of 100 nitrile gloves at $79.99.
And unlike masks, the federal government cannot order any USA factories to convert to glove production because they are not allowed to produce them. Bottom line, America is f—-d when it comes to gloves.
Now ask yourself this question: Who is going to pay these new glove prices? Answer: You. This will be the beginning of inflation like we have never witnessed before (and please, I hope I am so wrong in all this). If a glove costs $.50 and a McDonalds worker needs two, that is a $1.00 to $5.00 added to each workers costs per day. McDonalds will have to raise its prices to pay for the gloves. Every business will have no choice. That is how inflation starts.
Try to buy gloves on Amazon. The best online company in the world. In fact, the best company in the world, thank God for them. But if they cannot supply America with gloves, what does that tell you? All gloves sold on Amazon are for first providers only.
I have to get back to work, yesterday I ordered 5 million more masks and now I just ordered 10 million more gloves because of my dedicated factory. Now I just have to figure out what we are going to do tomorrow. I have an idea.
Those were the days. I used to dream about nail polish, nail polish colors and names, fragrances for lotions and scrubs and my next beach vacation.
Now all I dream about is face masks (WTF, who knew what a N95 or KN95 mask was before this crisis?), gloves, hand sanitizer, disinfectant and alcohol (I wish I was dreaming about Bowmore 15 & Oban), this is about isopropyl alcohol. I am also dreaming about hand soap, body wash, shampoo, cotton rounds, and foil sheets.
Michigan is a Stay at Home state like many others (why the Governor can decide and not the President is another story). Luckily, TNG is an essential company and our distribution center is open while all other employees work from home that can. Due to demand from the medical community, we stepped up efforts to supply critical supplies to that industry and hence the reason for my dreams.
We are in unprecedented times. My colleagues in NYC tell me that the city is way more scared and frightened than 9/11 because at least with 9/11, it was a one-time incident and they could go on with their lives after grieving. COVID-19 affects everyone, hence you walk around Times Square and can be by yourself. As virtually all businesses are shut down, consumers resort to online for everything from ordering goods to entertainment. Suddenly massive chain stores have zero advantage over online companies and in fact, are severely disadvantaged as they have to deal with fixed costs and millions of employees.
THE INDUSTRY SOURCE is the only beauty company open that has inventory of essential goods industry needs. How ironic the likes of Sally, Cosmoprof, Salon Centric and others ran out of isopropyl alcohol weeks ago and we are still shipping it. Other essential supplies from them? Forget it. In a crisis situation, size no longer matters, nimbleness and the ability to deal with the supply chain is everything.
We have KN95 masks coming in next week. We have surgical 3-ply masks coming in next week and the week after. We have hand sanitizer coming in from Italy and now making our own formulation of ForPro Hand Sanitizer Spray which we hope is in stock next week. Hospitals, doctors, nurses and others are very happy to work with us. I spoke to my friend who works at Patterson Dental. He told me they were out of N95 masks weeks ago and will not have any for weeks. This is a company that does more than $4B in business. 3M is running at full capacity but it is not enough.
Our factory that makes Ginger Lily Farms products is churning out for us three truckloads a week of gallons of body wash, shampoo, conditioner, hand soap and hand lotion. With everyone at home, there are more showers taken than ever before. Essential company employees like doctors and nurses are sleeping in their cars at night hoping not to infect their family so the need for shower stuff is greater than ever in places like hospitals not accustomed to this demand.
The government just passed a $2T (yes, that is one thousand billions) aid package. Our deficit was just over $1T and now the government just did that. What does that tell you? Who needs Hollywood! We are living the worst case scenario movie that any writer could ever dream up. India with its population of 1.3B just went into 3 week lockdown as did Pakistan. We already know what is going on in Italy. MI hospitals are reaching 100% capacity and we are only in the late beginning stages of this.
What do I think is most interesting about all this? My kids have called me more this past 7 days than the past 7 years. I have seen more people walking this week than the last decade. People are talking, playing traditional games and no longer taking everything and anything for granted. Yes people are scared and nervous, but they feel safe in their own home and home is more important than ever. Once this passes, how long will these new ideals last?
One thing for certain. Once this ends, certain words, phrases and other unique things from this will cease and desist forever. First to go: Social Distancing. Second to go: Elbow bumps. Third to go: Stay safe. Perhaps the X & Y generation have this whole perspective nailed: WTF, what ever happens, happens. Let’s hang out at the beach, drink some brews and dance the night away. Or in my case, dream about nail polish again.