In this series, we ask some of Canada’s most dynamic companies to share advice on how to find new, innovative paths to success in an unpredictable business environment.
If you don’t want to move it, online auction company MaxSold can probably sell it.
This premise proved to be a winning formula for the former Kingston, Ontario-based live auction company that ventured into e-commerce a decade ago.
“The idea was to create an intersection between this highly tactile service for downsizing and real estate sales that people still need, and a high-tech service provided by eBay, Craigslist, Kijiji and other online marketplaces. said the President and CEO of MaxSold. Sushi Perumal.
MaxSold has indeed found an ideal location for its growth, first expanding rapidly across Ontario and then into the United States.
“We knew if there was going to be a competitor it would be outside the United States, so we wanted to tackle it before the rest of Canada,” he says, noting that he also has operations in British Columbia. and in Calgary.
His strategy worked. MaxSold is now dominant in the United States among online auctioneers for home and moving sales, making thousands of sales each year in nearly 1,400 communities — including 20 states — while employing more than 500 people.
Sales at the end of 2020 – a year heavily impacted by the pandemic – were $20 million, the best in the business yet, and this year is expected to be even better with sales forecast to nearly double, says Mr. Perumal.
Earning a spot on The Globe and Mail’s Best Growing Companies for 2020 at number 243, MaxSold’s success has been a wild, arduous and ultimately profitable journey for Mr Perumal, 43, a father of a young family.
He has spent much of the past decade criss-crossing the continent in a 1978 single-engine Cessna 182, meeting potential partners, real estate agents and move management companies, which has been essential to the company’s growth. .
“It’s a very trust-based business, so we looked at other businesses that could benefit from ours and how we could leverage their relationships in the communities they serve,” he says.
Mr. Perumal’s commercial pilot’s license, obtained years ago as a hobby, has been particularly helpful, allowing him to take calls from potential partners in Boston at 9 a.m. and meet them for lunch at noon.
“Much of the last decade has been this mission impossible with no money,” he explains.
If it weren’t for gaining access to the borrowed plane, which Mr Perumal describes as an old Volkswagen van with wings – “complete with an ashtray” – MaxSold might never have overcome the problem of ” chicken and the egg” that is hampering growth for most online marketplaces.
“You need a selling audience and a buying audience, but the problem is that sellers don’t want to use you unless you have a buying audience, and vice versa.”
Mr. Perumal tried every idea he could think of to grow MaxSold’s user base, engaging PR firms, marketing firms and consultants.
Still, connecting with real estate agents and others involved in helping individuals move has proven to be the fertilizer for income to flourish.
“They had this bleeding neck problem and they spent so much time, money and effort cleaning up customers’ belongings,” he explains.
Other companies offer similar services, but MaxSold has become dominant in several markets because it is the only one that catalogs, measures, photographs, describes and sells absolutely everything.
“Others pick up cherries, and most other items end up in landfill,” he says. “We sell everything from under-the-sink cleaners to the car in the driveway.”
The idea is not that of Mr Perumal, but that of Barry Gordon, the son of the first owner of the auction business launched in 1956. Mr Gordon acknowledged that the future was online, but n had no idea how to turn the business around.
He turned to nearby Queen’s University for advice, which eventually led him to former MBA graduate Mr Perumal working as a consultant.
“Let’s just say I have an entrepreneurial spirit in me,” says Perumal, now MaxSold’s largest individual shareholder, of accepting the job for free at first. As MaxSold grew up in Ontario, he looked to the United States and sought advice from mentors.
Most said, “Why would you take the risk?” adding that the big companies had tried and failed.
“I heard their advice, but I wanted to do it anyway…and for the first two years, it was like pushing a rock up a hill.”
The hard work paid off as revenues grew rapidly in Phoenix, Atlanta, Los Angeles and elsewhere. Then the pandemic hit; operations froze for weeks while Mr. Perumal redesigned the business model, including launching an app that allowed customers to list their own items. MaxSold has also offered curbside pickup and developed protocols so its employees can safely enter customers’ homes.
“In a way, COVID has accelerated business,” he says of the increased adoption of e-commerce and the simultaneous housing boom. “It was about being in the right place at the right time and being prepared.”
Recent success has helped attract investment from a venture capital firm, funds to fuel further expansion in the United States and across Canada as well.
Mr. Perumal has even bought his own plane: a 1977 twin-engine Cessna. Slightly faster than the single-engine plane he borrowed, he hopes to meet his customers even faster when travel restrictions ease.
When it comes to advice for entrepreneurs about the United States, Perumal says to be persistent and not be afraid to try anything, because something has to work.
“There’s no magic bullet – just lots of lead bullets.”
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