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Business First's Emerging Company of the Year Winner


Click here for a pdf version of this story.

Company rides wave of do-it-yourselfers to spot in Inc. 500 listing

Jim Allen was sitting at his desk around 9:30 a.m. one Monday not long ago, drinking coffee and reading emails, when his shipping manager brought in a package Allen had been waiting for. "I started getting nervous when I saw the label was from Inc. (magazine)," said Allen, CEO of Appliance Zone LLC in Corydon. "I remember my hands were kind of sweaty opening the package." He pulled the information out of the overnight box. "On top was a letter saying congratulations," Allen said. "I was really shocked. I did not think we were going to be that high on the list." Appliance Zone, which sells appliance parts and accessories online, had been named to Inc. magazine's 500 fastest growing U.S. privately held companies for 2010, coming in at 39th overall and third in the retail category.

A Company to Watch

The Inc. recognition is the kind of success that fast-growing Appliance Zone has garnered in a few short years as an emerging company that processes roughly 400 to 800 orders per day for household appliance parts though its Web site at www.appliancezone.com. "It's got us a lot of telephone interviews with newspapers and magazines." Allen said he also has been contacted by about two dozen venture capitalists and bankers since the announcement. "I always ask them, 'where were you two years ago when I really needed some help?' " Allen said. Allen, who had run his own appliance repair business for 14 years with his wife, Paula, launched Appliance Zone a few years ago. He originally ran the company from a computer in the basement of his home in LaPorte, Ind. Allen, who moved the company and his family to Corydon in 2007, said he started the company with less than $1,000.

Taking Systems to the Next Level

Appliance Zone recently installed a new order-processing system, which took nine months to develop. The system will enable the company to handle 10 to 30 times more orders. About 90 percent of its customers are individuals who need parts to repair their own refrigerators, stoves, microwaves, washers, dryers and other appliances, Allen said. Roughly 8 percent of customers are semi-professional handymen, and the rest are companies or government agencies, Allen said.

Poor Economy Created Do-It-Yourselfers

"With the downturn in the economy, it's more feasible to repair your own appliances rather than buying new ones or calling a repair company," Allen said. "People really seem to enjoy the satisfaction of being able to do it yourself." Appliance Zone's Web site receives 10,000 to 12,000 visitors each day, Allen said. Ninety percent of company sales are domestic, and 10 percent are international. International sales have tripled since 2009, Allen said. "I get a lot of personal satisfaction in going back to the shipping department," Allen said. "I just love seeing those packages going to France and Germany and the United Kingdom. I feel very proud." The company works with multiple suppliers and distributors who ship parts from 30 warehouses across the country.

Serving Customers More Quickly

In an innovative move, Appliance Zone took its phone number off its Web site in March 2009 and converted to handling all of its sales and customer service through live chat online. Allen said that at first he was criticized by customers and sales reps for this change. "It was a very bold move, but it has definitely paid off," Allen said. "It's better than being put on hold or having to push 20 buttons." "I knew that hiring more people to answer phones was not cost-effective." Allen said a customer-service worker can handle one customer at a time on the phone. But the same service person can handle as many as 15 customers at a time through live chat online that is enabled by custom software. As part of its marketing efforts, Appliance Zone signed an agreement with Lucas Oil Racing in July 2010 to sponsor a driver development contest in dirt auto racing. The company plans to launch television commercials in late 2010 or 2011, Allen said.

Founder's Character Led to Success

Mike Furois, president of The Planning Associates Inc., a financial and investment firm in Phoenix, has known Allen since 1992. Furois is Allen's personal and business financial adviser. Furois credits Allen's "tenacity and perseverance" for Appliance Zone's rapid success. "He's very, very driven," Furois said of Allen. It's just a personality trait." "He plows forward and makes his own trail. He'll do whatever it takes to make things happen." Allen dropped out of high school at age 16 and took his first job at Domino's Pizza, where he became the youngest store manger in the St. Petersburg, Fla., region at age 20. He began working for himself at age 21. He didn't get a high school equivalency degree, but he has attended some criminal justice college classes. "I learned from Domino's Pizza how to be an entrepreneur," he said. Allen said he reads a lot of biographies of successful business owners and spends time watching the Biography channel. "I really have a very deep desire to be successful," Allen said. "I have an unrelenting goal for Appliance Zone to be the No.1 appliance parts company in the world. "I like the challenge, I love the work. I do it every day, seven days a week."

Rachel Reynolds Business First’s Emerging Company of the Year Winner Dec. 10, 2010