Progressive Rentals March-April 2005

What’s the Key to Customer Loyalty? Feedback by Mike Hetherington

Eye Robots: Video Surveillance in Rental Stores by Ed Winn III

Who’s Checking References? by Ed Winn III

In Full Bloom: An APROfile of ColorTyme's Bob Bloom by Kristen Card

What's the Key to Customer Loyalty? Feedback

by Mike Hetherington

While the world of business has lurched, reinvented itself, crashed and soared, this wisdom remains unchallenged 50 years after it was written. With look-alike competitors offering commodity products, retaining RTO customers is the name of the game.A“A lost customer may be difficult and expensive to recover. In some cases, it is necessary to wait a generation before the account has the potential to be resold,” says John Sviokla, professor of marketing at the Harvard Business School and author of Keeping Customers. The good news for the rent-to-own industry is the Federal Trade Commission’s 1999 Survey of Rent-to-Own Customers, which found the average RTO customer purchasing 2.5 items every five years with 75 percent of the respondents self-described as satisfied. The link between customer retention and profit is strong. “Businesses that earn superior levels of customer loyalty and retention also earn consistently higher profits— and grow faster as well,” says Bain & Co.’s Frederick Reichheld, author of The Loyalty Effect.

The most obvious and powerful tool for increasing customer retention and loyalty is learning what your customers think and feel and then being responsive to their needs, problems and wishes. Here are some methods innovative rental dealers across the country are employing to keep their customers coming back.

IT’S ALL IN THE DELIVERY

Many already “get it.” Brownie Calvin is president of Option Rentals’ four Nashville, TN, locations and a 24- year RTO veteran. Viewing delivery as the pivotal customer experience because of its lasting impression, he does a post-delivery phone follow-up asking about presentation, explanation of options, courtesy, promptness and payment confirmation. Calvin supplements the call by mailing a simple, eightquestion survey checking on the clarity of equipment-use instructions, evaluating the sales and delivery staff and open-ended questions inviting customer comment.

Lastly, his stores have a registry that rewards sign-ins with a small gift.Using the data collected, they make calls to anyone who didn’t rent, tracking what those customers wanted but didn’t find. This has led directly to expanded jewelry and furniture inventory. Reichheld likes Calvin’s strategy, citing “failure analysis… is a preferred feedback tool especially as it applies to customer defections.” To sustain continuing loyalty, Option Rentals also mails birthday cards, makes periodic “check-up” calls and even has an occasional customer appreciation dinner.

BUILDING A “HAPPINESS GENERATOR”

Stephanie Primm, president of SAM, a Sandpoint, ID,- based marketing and branding firm, has specialized for 20- plus years in “simple and smart marketing for real people doing real business,” consulting for national clients from the Fortune 100 and for storefront main street businesses. She highlights one area of useful “stealth” feedback. “Transaction data is a very real—and often overlooked— type of feedback simply collected at the time of sale.Your marketing strategy should target those customers who are or will be your primary sources of revenue.

“Learn as much as you can about your best customers and make sure they’re happy. Correct anything making a customer unhappy and focus on building “happiness generators.” This is the just the 80/20 rule—80 percent of your business comes from 20 percent of your customers— and will protect your baseline revenues.” Primm suggests moving away from the casual—“I see my customers every week and know them well”—and toward hard facts that may tell a different story. “It’s scary how often what you ‘know to be true’ really isn’t,” she says. What types of data does Primm suggest you gather? “Get the profile of who’s renting what. Knowing those profiles helps you tailor your messages and focus your marketing dollars. For example, if your highest margins are on case goods, it’ll pay you to track who’s renting them and proactively targeting that market.”

HEADING OFF THE SNOWBALL EFFECT

Another feedback pro is Chuck Kuluva of Kansas City, MO, co-owner of three Rental City stores. During his 15 years in the RTO business, he’s come to value feedback as a strong business builder. One of the two feedback tools he uses is a manager follow-up call immediately after delivery. “I want to know of anything wrong, damaged, missing or that made them unhappy so I can fix it right away. If we can catch problems early, we prevent a lot of problems before they get ugly later. These things have a way of snowballing. I don’t want customers out there festering and unhappy and not know about it.” As Primm says, “There’s no downside to feedback. It’s like going to the doctor. If you’re healthy, it’s a relief. If there are problems, it’s a good thing you went in when you did. It’s always better to know than not know how you’re doing.”

Kuluva’s second feedback tool is a letter mailed the day after delivery. “It reminds the customer of when payments are due and it has my name and personal phone number on it. It’s a terrific ‘early-warning’ tool.” Monitoring feedback also alerted him to a profitable trend. “I knew for some time that people were becoming more astute shoppers, but I learned they were willing to pay more—sometimes a lot more—for high-end furniture so we started stocking more.”

THE MYSTERY SHOPPER

Feedback can also be gathered indirectly. Since 1990, “Secret Shopper” (www.secretshopper.com) has been one of North America’s largest mystery shopping services with more than 250,000 shoppers quietly monitoring live customer service and sharing those findings with clients. Paul Wilson is founder, president and CEO. Why mystery shopping? “Consistent, classic ‘survey research’ is way beyond the budget of all but the largest businesses,” says Wilson. “Comment cards tend to elicit extreme responses.

Only through mystery shopping can business consistently and reliably measure and improve customer satisfaction.” While direct feedback is cumbersome to gather, sort and classify, mystery shopping frees clients to focus on what they do best. “We can gather the information for them in the most cost-effective method possible and present it in the most user-friendly and useable manner; 24/7 instant Internet access is pretty amazing,” says Wilson. That impressive immediacy gives users powerful responsiveness to service lapses, snags and suggestions while its arms-length, third-party anonymity yields valuable candor. Wilson tackles the cost question head-on: “Mystery shopping does not cost—it pays. That is why most of your strong competitors are doing it. Mystery shopping is your cost-effective answer to, ‘What can we do better to obtain more revenue?’”

ADDING A PERSONAL TOUCH

Gathering feedback is a daily activity for Jeff Parish, a 14-year RTO executive who is currently COO of New Vision Rentals’ two locations in Oswego, NY. Parish is always looking for “what products people want and what service issues are most important to them.” Killing two birds with one call, New Vision calls inactive customers to gather feedback about any issues they might have had as well as inviting them back. “Sometimes we discover why we haven’t seen them recently and also have the opportunity to plant seeds for future business.”

Is that effective? “Absolutely. It’s an easy conversation to rekindle a relationship. Very few don’t repeat. We tell them how important they are to us—and that means a lot to many of our customers.” Feedback also increases loyalty by helping RTOs spot new trends early on. As an example of how feedback can drive new business, Parish developed a new niche selling tires. He isn’t alone.

RAISING THE BAR

Keith LaBahn, president of All American Rentals in Ft. Collins, CO, for 18 years, also found himself adding new items to his inventory. Responding to direct, face-to-face feedback, he’s added high-margin small appliance business (e.g., bread makers), a specialty tools area (e.g., unique shop equipment) and an expanded special-order catalog that’s been a big hit spurring repeat business. He’s also rented highprofit custom products such as “carpet, a customer’s entire Christmas wish list and even lumber and sheetrock for finishing a room.”

Loyalty doesn’t sprout from the information gathered, rather from the actions taken in response to it. Just ask Bob Eakin, president of Star United Rent-to-Own in Hillsboro, OR,who is a firm believer in “the customer is always right.” He gives credit to his response policy, which is to “take care of any problem immediately. I don’t care what it is— we take care of it right now.When someone doesn’t think his TV remote works right, we just replace it. Customers aren’t too concerned with fine print; they just want a TV that works. That kind of service is worth a fortune in repeat business.” In a similar vein, Option Rental’s Calvin credits high retention to “our goal of carrying our customers ‘to term.’ We want to turn inventory, not customers. Many RTO customers are not financially capable when we first meet. They come in thinking ‘I need help’ and it’s our responsibility to help them stay current so they don’t lose what they want.We want to ‘marry’ our customers longterm, not just get some of their money short-term.”

REPEAT BUSINESS IS A TWO-WAY STREET

Retention and loyalty arising from feedback-driven responsiveness is the growing trend. “Repeat negotiations are costly and time-consuming. Repeat purchases are the reward for those who constantly deepen their ties with existing accounts,” says Sviokla. Marketing is shifting away from a one-way monologue to a dynamic dialogue. “The winners use knowledge gained from interaction with customers to innovate, invest in core skills and make excellent products to fill customer needs,” says Sviokla. The future belongs to those who leverage and apply what they learn from their customers.

Eye Robots: Video Surveillance in Rental Stores

by Ed Winn III

Both the price and size of closedcircuit video cameras and recording equipment keep getting smaller. Some cameras are the size of your thumb. It is no wonder that rental dealers wonder about using this technology to keep an eye on things in the store when they aren’t physically standing there looking around. Who wouldn’t like to have a camera on the back room to see where those DVD players keep disappearing to? Who wouldn’t like to have a camera trained on the Dumpster in the parking lot to record who is really “Dumpster diving” for customer lists or other proprietary information?

Who wouldn’t like to watch and listen in on a new employee’s sales presentation to measure his or her progress and attention to the expensive new training program? Well, in the words of Meatloaf, “Two Out of Three Ain’t Bad.” You can do the first two. You can’t do the third. Here is the law in a nutshell about video surveillance in the workplace as it applies to the typical store. First, you can do it. You don’t need permission.

You don’t need consent. You don’t need to post notices if you don’t want to. You can be as surreptitious about it as you want. You can hide or camouflage the cameras so that people will not know that they are there if you want. You might ask yourself, however, if you are intent on cutting down on pilferage and that is the main reason you are videotaping activity in the store or the parking lot, that maybe big posters telling everyone that they are being filmed and having cameras openly on display will actually help with the theft problem.

Otherwise, nobody knows about the filming and somebody is going to have to watch a lot of boring footage to catch the thief. Maybe it’s better to put the thief on notice that he or she is being watched. Next, make your videos silent. Don’t record voices. This is because of the Electronic Communications Privacy Act (18 USCA sec. 2510). This federal law, an amendment to the Omnibus Crime Control and Safe Streets Act, governs aural communications and provides a civil remedy to anyone whose wire, oral or electronic communication is intercepted, disclosed or used by someone else without permission. The act does not address the issue of videotaping without sound directly, but a number of lawsuits have done so.

There have been several federal appeals court cases testing the proposition and the rulings have consistently been that it is the interception of an oral communication that triggers the statute and not mere video surveillance without any sound. You can’t tape someone’s conversation without his or her knowledge and consent and if you do, there is civil liability under this federal law and under some state laws as well. That is why you hear the voice telling you that your call may be recorded when you are put on hold with almost any company these days. They are selectively recording conversations for training and other purposes and are putting everybody who is on a call on notice.

This federal statute does not apply to silent video recordings as per a number of federal circuit court opinions. The only other rule you must follow is not to set up a video camera in areas where either customers or employees could arguably have a “reasonable expectation of privacy.” The Nevada Supreme Court held that people have less of an expectation of privacy in the workplace than elsewhere. This was a case brought by PETA against an animal trainer in a Las Vegas casino act. The trainer was secretly videotaped beating an orangutan backstage before a performance was to begin. The trainer’s contract with the casino provided that he was to be free “from distracting intrusion and interference with his animals.”

He used this language in his contract to argue that he had a reasonable expectation of privacy in the backstage area where his animals were kept. The court ruled against him holding that the videotaping of the area did not interfere with his handling of the animals. There are not going to be many places in or about an RTO store where either customers or employees can legitimately claim a reasonable expectation of privacy. It does mean no cameras in restrooms. Rental dealers aren’t renting clothes, yet, and so there are no dressing rooms, unless employees wear uniforms and there is a place for them to change in the store. Employees don’t generally have a reasonable expectation of privacy in the back room.

Nobody can reasonably expect privacy in the parking lot. On this point there was a case against the Golden State Warriors in California in which the court dismissed privacy claims from a plaintiff who was trying to suppress videos taken by a private eye of the employee taking drugs in his car while parked in a parking lot. You can videotape parking lots and the cars that are in them. Dumpsters aren’t private. There are rules against videotaping employees doing union business under the Labor Management Relations Act (29 USCA sec. 185), but so far at least, there are few, if any, union employees or union activity in rental stores. Do think about your goals in setting up cameras in your stores.

Make sure that it is something you feel you need to do to protect and further your business. You can find out all about the equipment that other merchants are using and how much it costs by Googling “video surveillance equipment” on the Internet. Happy filming.

Who's Checking References?

by Ed Winn III

I was sitting around drinking with a rental dealer late at night not long ago in Florida. I learn a lot from rental dealers in such circumstances—good things and bad things. I generally keep the bad things to myself. I try to circulate the good things. I learned some good things from this guy who is also a drummer and seemed to have a good sense of rhythm to his life.

Anyway, this rental dealer has been in the business for a long time and has a few stores and has been in and out of the dayto- day stuff.When his head is firmly in the rent-to-own game, his stores do very well.When he pulls away, not surprisingly, things go less well. Most rental dealers with any experience know how this goes. However, this was not the most important thing I learned from this rental dealer—that rental dealers need to stay involved in their businesses if they are to be maximally successful. It was something else he shared with me—something more nuts and bolts— that I want to share with Progressive Rentals readers.

This dealer’s company had a policy, like all rental companies probably, that employees are supposed to check an applicant’s references before delivering the merchandise. That is a pretty fundamental concept in the business. The company even had a checklist to show that each reference had been duly contacted. When my drinking buddy, the storeowner, was hovering in the store, references were getting called and merchandise was getting delivered and collections ran smoothly and the business grew and there was a respectable bottom line and life was good. Then, when the owner was out doing other things, guess what? Customer references weren’t getting called with the same devotion and reliability as when he was in the store.

The paperwork looked the same. The boxes were getting checked so that it looked like references were getting checked and merchandise was still getting delivered, but the collection end of the business was getting badly out of whack. Suddenly there were too many skips, too many stolens, too many hard accounts were popping up in the system and the business was not growing and the bottom line suffered. And when the owner went back in (and not without some sense of foreboding and alarm), at first he could not put his finger on what was wrong.

Everything looked the same, except for the deteriorating results on the books. It was somewhat by chance that he pulled a few customer files and dialed a few reference telephone numbers—call it a rent-to-own instinct developed from a long life in the business—when he quickly discovered that employees were taking some shortcuts in the calling references department when he was not around.

Now, we could take time out here and speculate forever about why this kind of thing happens in a rental store. Why won’t or why don’t store-level personnel do their jobs every day with the level of responsibility, conscientiousness and professionalism that the owner wants and is paying for? It probably has to do with some fundamental flaw in human nature or in the nature of some humans, at least, to take the easy way out when the boss isn’t in.

But it finally does not matter much why. It is the kind of thing that happens in rental stores and similar kinds of things happen in other kinds of stores when management is not as attentive as its needs to be on how the job is being done. So if we want to lay some blame, we can lay plenty of it all around. Well, the owner may have thrown things. He may have fired some people. He and I didn’t get into all of that. We were drinking and it was a happy story. What I know he did do, because he told me, was that he fixed the problem. It came down from the top—from him— that henceforth, in the company, all references would always be checked on all accounts before any merchandise could be delivered.

As soon as that policy was put back firmly into place and emphasized and trained for and checked by management, the business perked up and life got good again, almost instantly. The front end of rental transactions is vitally important to the health of a rental enterprise.We all know that and could answer that question on a test, but in the day-to-day chaos that goes on in a rental store, sometimes things don’t work like they are supposed to. People get in a hurry and there is pressure to make deliveries and one of the shortcuts that can be made is to pretend to call a reference and not really make the calls. Or, to try perhaps, faithfully, many times even, to make the call and not be successful—nobody is ever home—and to finally go ahead and O.K. the delivery.

After all, most people are honest, the employee reasons. A couple of the references did check out and what the heck, “If most people weren’t honest, we wouldn’t be able to be in this business in the first place.” True enough, but not all people are honest and one of the things that the crooks will do is dummy-up personal references. And so when a rental shop gets sloppy on the front end, that slop will almost always show up on the back end with too many skips, too many stolens and too many hard collections.

That makes the business so very much harder to run and so much less fun and so much less profitable. Clamping down on references and insisting that every one be called may mean that a delivery or two gets delayed and maybe not made at all. But had those deliveries been rushed out the door, they are not the good, clean, easy, regular paying accounts that make money for the store.

They are trouble and most dealers will agree that it is better to catch them up front than later when merchandise is at risk. It was such an easy fix to a momentarily puzzling problem in my friend’s company. He and I both hope that it is not an issue in your company and that your employees are calling and verifying every reference every time. But, if something isn’t quite right in your shop at the end of the month, here is a place to start looking for what might have temporarily gone wrong.

In Full Bloom: An APROfile of ColorTyme's Bob Bloom

by Kristen Card

I am naturally a very detail-oriented person; I’m more comfortable in the tactical, checklist-type mentality. But I’m learning to be more strategic and certainly need to continue to grow and improve strategically in my current role in order to focus on the big picture.” r It’s not your typical business bigwig bravado, stuffed with examples of superhuman professional strengths and certainly not what you expect to hear from the man tapped to lead America’s longest-running franchised rent-to-own company. But Bob Bloom, ColorTyme’s (www.colortyme.com) new president and chief executive officer, isn’t your typical business leader.

Bloom has built a remarkable reputation for himself by building and rebuilding multi-unit operations, including being part of the Thorn America team that grew from 500 to 1,500 stores, and helping take EZCORP’s net income from an $8-million loss to an $5.4-million profit in just four years. Not quite a year ago, ColorTyme engaged this titan of turnaround to take the company reins during a “critical time of growth.” r However high profile his string of successes may be, Bloom, who is consistently candid and refreshingly self-aware, insists his career path isn’t the product of some master plan. It has simply been a series of opportunities that have presented themselves, he says, and he has been prescient enough to seize and make the most of them.

“My personal dream has always been to be fulfilled at what I’m doing,” Bloom says. “I’ve got a clear vision for ColorTyme and am here to execute that plan, but I’m not a person who looks out there and says, ‘Here’s where I want to be in five years.’ I’m not visionary. If I’m happy with what I’m doing, then I don’t look for something else. “I’d never heard of Rent-A-Center until the day of my first interview I never envisioned myself in the pawn business and, while I was doing that, I never saw myself returning to rent-toown— though I’m unquestioningly passionate about this business. But frankly, I never thought of myself as president of a company until the day I got the job. Opportunities happen. I just try to recognize them.”

Learning the ropes Opportunities do happen, but as writer and economist Stephen Leacock said, “I am a great believer in luck and the harder I work, the more I have of it.” Hard work has played an essential role in Bob Bloom’s life from early on. Born in Cambridge, NY, just three miles from the Vermont border, Bloom had a relatively rural upbringing, working on dairy farms from the age of 12 and graduating high school with a class of only 70. His father, a decorated war hero, was severely injured as a prisoner of war during World War II and hospitalized for almost a year.

Once he was able to return home, however, he made sure he was able to support his family. His uncompromising work ethic continues to inspire Bob even now. “My father was a very hard worker,” says Bloom.“He was blue-collar, a lineman for the electric company. He took extra jobs in order to support his family. He was the epitome of integrity. At his funeral a couple of years ago, everybody kept coming up to me and saying, ‘He was such a nice guy.’Now that’s not a bad epitaph.” Bloom worked full-time while attending Hartwick College, a small private school in upstate New York.

During summers, he bartended nights while continuing to work full-time days. Bloom graduated with a history degree and while he enjoyed the restaurant and hospitality business, he realized he had to get out of bartending “for all kinds of reasons,” he says. He accepted a manager trainee position with Ponderosa Steakhouse Inc. “Ponderosa was a very small company at the time,” Bloom says. “I think they had five stores in New York State and about 75 stores nationwide. I helped the company grow quite a bit one way or another by opening about 50 stores within seven years.”

Bloom managed a single store, then four stores and then 15 and was then requested to go to corporate headquarters to supervise research and development. “It was a fascinating learning experience,” he says. “I learned research, marketing, how to take an idea from a concept to a national rollout, how to analyze different trends. I was growing tremendously personally and developing a lot of terrific people for the organization.” Promoted again to assistant vice president for Pennsylvania, Bloom oversaw 36 restaurants.Working with a strong team, he used his expertise to develop new products for the company and, says Bloom, “life was really good.” Then, opportunity knocked. “[The company] wanted me to go back to New England,” says Bloom, “where they’d gone from about a $5- million operating profit to a $1-million loss within a year.

I brought a lot of people along with me and we completely turned the marketplace around in two years. We were the best-performing region in the company.” A change in venue: from foodservice to RTO All that changed when Ponderosa was bought by a man who sought to sell off all its assets and pocket the profits, leaving employees jobless. Bloom chose to leave. Within 90 days, he had four job offers—three in the restaurant business at the VP level and one from Rent-A-Center as an area manager running six stores. “I took the Rent-A-Center job,” Bloom says. “At the time, you did what was called a waiver day, which is where you actually spent a day at the store and went out on deliveries, did collection calls and worked in the store. I did that for eight hours and had so much fun, I went back the next weekend and worked for free.”

Hired in June 1990 to manage six stores, Bloom was managing 12 stores by October, 16 by November and by January had been promoted to regional director for the Northeast overseeing 47 stores and six area managers. Nine months later, he was promoted to vice president of operation administration where he was responsible for company policies and procedures, new products and programs and franchising. “It was a great run,” says Bloom. “I had a lot of good people working for me, some of whom are now presidents of their own companies. Rent-A-Center wanted new ways to continue to grow the business and put me in charge.

“We developed a company called Thorn Leasing Concepts, which got into the rent-to-rent business,” he says. “Within about a year, we had $8 million in revenue and about $3 million in profit. It was going great, but I was no longer needed, so I became divisional vice president of rural stores, responsible for developing a growth model and program. Over the next 15 months, we grew to 185 stores, operating completely independent from the urban Rent-A- Center stores. At the time, we were the best return-on-investment of any business line [Thorn EMI] had worldwide.”

But when Rent-A-Center was sold to Renter’s Choice, the new owner decided to clean house and Bloom was on his own again.He returned to Ponderosa to head the company’s franchising operations, but found the leadership lacking and the work environment stagnant. Meanwhile, Rent-A-Center’s former chief operating officer had moved on to become CEO of EZCORP, America’s second-largest pawn chain. The company was in deep trouble. He called on Bloom for help. “He took me in as a vice president, then promoted me to senior vice president of operations,” Bloom says.

“We revitalized the management team, put systems into place, established standards of operations and performancebased management and introduced payday loans.” According to Bloom, EZCORP lost $8 million during his first year with the company, lost $600,000 his second year and, two years later, made $5.4 million. “It was just a phenomenal turnaround,” he says. “I started in May 2000 and stock was at 50 cents; it hit $20 today.” ColorTyme calls “I have to be happy in what I’m doing and being challenged,” says Bloom.

So when ColorTyme called last spring with a new challenge, his interest was piqued. ColorTyme, a subsidiary of Rent-ACenter, celebrates its 26th year of business this year. With more than 20 of those years as a franchiser, ColorTyme is the oldest franchised rent-to-own company nationwide.Now, the company’s longevity was beginning to work against it, as its early franchisees began to reach retirement age and bow out of the business. “For the past five years, [ColorTyme] has opened about 30 new stores a year,” Bloom says. “But longtime franchisees have begun retiring and selling about the same number of stores back to Rent-A-Center every year. As a result, our growth has been regressing and, without intervention, that trend seemed unending.

I was brought in to grow this company.” Bloom took over as ColorTyme’s president and CEO last June. During his first six months, he and his senior management team—who, combined, have more than 100 years of rent-to-own experience— got together for a minimum of eight hours a week to talk about the business and put together a new strategic plan for the company. What they came up with is clearly centered on what Bloom considers to be the core of ColorTyme— its franchisees. “Our franchisees are our customers,” says Bloom.

“All good ideas in a franchise organization come from franchisees. And the franchisors who listen to and work with their franchisees are the ones who develop the new programs that keep a company alive.” Bloom says his first focus is on helping current franchisees grow. Of ColorTyme’s current 73 franchisees, 45 (almost 60 percent) of them have fewer than three stores. Bloom is working to find new revenue streams and launch new product opportunities for franchisees, including payday loans and custom wheel rentals.

Franchisee focus and a new strategic plan Bloom and his team are also concentrating on helping franchisees better manage their businesses by providing a variety of exceptional training resources. “One of the programs developed by our vice president of operations, Sam Lowe, is exCEL, a self-paced computer training program for store personnel,” Bloom says. “Sam is a world-class trainer with over 20 years of expertise. He also recently revamped our ColorTyme University ‘graduate’ program, which has separate classes for store managers, regional directors and franchise owners.

It’s comprehensive and very impressive; it offers situational leadership skills, people development, self-development, time management, inventory management— the tools you’re not going to get just working in the store. And not only are the course materials excellent, but the owners also have an opportunity to spend four-and-a-half days in a classroom with 14 of their peers talking about their business. It’s invaluable.” Additionally, the company’s new strategic plan includes two new financing programs intended to serve as incentives for rent-to-own veterans to become franchisees. ColorTyme is offering $1,000 credit toward its initial franchise fee for each year of experience franchisees have within the rental-purchase industry, up to $10,000 per person.

The company is also facilitating partnerships between multi-store managers and investors so that multi-unit operators can own 51 percent of their own ColorTyme store for an investment of only $20,000. Bloom understands that getting ColorTyme to grow again will be an uphill climb, but he’s definitively optimistic, in part because he’s a true believer in the heart of the company. “We care about our business a lot more than someone who’s working for one of the large, publicly traded companies,” says Bloom. “It’s people helping people. We’re locally owned and operated, we give back to our customers, we’re developing our people and our businesses, sharing best practices and helping our communities be better places because we’re there.

People helping people is our value statement; it’s who we are, it’s what we do.” Yet amid ColorTyme value statements and strategic plans, Bob Bloom is always keeping one eye on the prize. “My proudest professional moment will be when ColorTyme doubles its growth,” he says. A team effort Bob Bloom’s official bio refers to him as a “proponent of participatory leadership.” This seems plainly accurate— he rarely speaks of his professional achievements without mentioning the great teams he’s worked with to reach them, often naming specific individuals who impressed, influenced or mentored him along the way. It’s apparent, too, that just as often, he has served as the impresser, influence or mentor for others.

“From day one, I’ve had a keen eye for talent,” he says. “I’ve been able to surround myself with quality people and help them develop and grow. I’m not easy to work for because I challenge them all the time, but I think one of my talents is helping people see their potential and get the most from it.” Bloom helps his colleagues realize their potential through a leadership approach that is as upfront as he is. Integrity is key. Be accountable—what gets measured gets done. Try to understand where other people are coming from and what’s in it for them. Each and every interaction you have with another person is a learning opportunity. And excellence isn’t just possible, it’s expected. “There are no little things,” says Bloom.

“Whether it’s picking up gum wrappers or cleaning your windows daily, there’s nothing too small to attend to. Your customers will reward you for providing quality, for taking care of the little things.” Oh, and don’t try to B.S. him. He hates that. “I can’t work with people like that, who tell you what they think you want to hear,” Bloom says. “I’m very straight- forward. I’m not political. I don’t know how to say things in shades of gray. While I understand I can’t expect that from others, I do look for it.” Bloom claims, rather convincingly, that he simply isn’t a person who can work 8 to 5. Usually at the office before 7 a.m., a 12-hour day is much more likely, so time for family and favorite pastimes is at a premium. “But when I’m home, I’m home,” says Bloom.

“I don’t have a lot of other interests.” That helps explain Bloom’s successful 28-year marriage to his wife, Kathy, and their two grown daughters, who, Bob says with a laugh, luckily inherited their mother’s smarts and their father’s work ethic. One daughter works with cable network Spike TV in New York City, while the other is in Boston, working with global business consulting firm Bain & Co. “My girls,” says Bloom. “They’re by far my finest achievement.” Somehow, Bloom still finds the time to read voraciously, regularly devouring five magazines and two books a week.He’s also an avid hunter of whitetail deer and turkey and, lately, has taken up archery hunting, because, he says, it’s more challenging.

Proud to be RTO Bloom might have been brought back into the rent-to-own industry as a troubleshooter, but he says his plans for ColorTyme go way beyond getting the company past some short-term growth difficulties.His passion for the business is genuine and likely just as lasting. “I love this business, I love these customers— I’m serious,” Bloom says. “Our customers—the cash-constrained, credit- constrained consumers—are great people and are under-served. There are about 40 million of them, they’re one of the fastest growing consumer segments and they’re very loyal. Time and time again, you deliver a big-screen, you deliver a refrigerator and you see how you’re improving their quality of life.

You don’t get that type of opportunity with many other businesses. “At ColorTyme’s convention a couple of weeks ago,” he says, “I told our franchise store managers they should celebrate paid-in-fulls just like they celebrate birthdays at restaurants. We ought to all come out and play loud music and clap our hands. We should be patting that customer on the back, because that customer—through our help and a lot of timely payments—has received ownership of a product he or she had no chance of getting ownership of otherwise. I’m very proud of that, and I think this whole industry should be, too.”