Episode 60: From VW Bus to 800,000 Square Ft: Sweetwater Sound Grows in Fort Wayne
June 10, 2019
This week we convey you the story of Sweetwater Sound, a homegrown Fort Wayne, Indiana firm that began as a one-man operation in a Volkswagen bus in 1979 and has since grown to turn into the No. 1 online retailer of music instruments and audio gear. The company announced plans in October 2018 to take a position $76 million in two new amenities at its 163-acre campus in Fort Wayne, bringing its amenities to a complete of 800,000 square ft. To get the complete story behind this impressive progress, we spoke to Sweetwater’s visionary Founder and CEO Chuck Surack and John Urbahns, CEO of Higher Fort Wayne Inc.
Endurance Fairbrother (DCI): The yr is 1979 and Chuck Surack has a dream and a VW bus. He has just returned from a five-year stint enjoying music across the country, and he decides to start out his personal recording enterprise proper out of his car.
Andy Levine (DCI): Quick forward to 2019, and Chuck’s firm Sweetwater Sound is the main music instrument and audio gear retailer within the country. In reality, we’re recording on Sweetwater gear right now.
Endurance: The corporate has seen impressive progress of over 20% in recent times and right now has over 800,000 square ft of amenities. And they’re nonetheless based mostly proper where they began – in Fort Wayne, Indiana.
Endurance: So welcome to episode 60 of “The Undertaking: Inside Corporate Location Selections.” I’m Endurance Fairbrother of Improvement Counsellors Worldwide.
Andy: And I’m Andy Levine additionally with DCI and Endurance’s co-host of “the Undertaking.”
Endurance: This week we convey you the superb story of Sweetwater Sound, a homegrown Fort Wayne, Indiana company that has grown from a one-man operation to turn into the No. 1 online retailer of music instruments and audio gear.
Andy: The corporate announced plans in October 2018 to take a position $76 million in two new amenities at its 163-acre campus in Fort Wayne. This is the company’s third main enlargement since 2012.
Endurance: First we’re going to listen to from Chuck Surack, who started Sweetwater Sound when he was simply 22 years previous – that’s five years youthful than me – and he did it out of a VW bus.
Chuck Surack (Sweetwater Sound): Properly, I started the corporate 40 years ago in my Volkswagen bus. I was a musician on the street and came house, frankly, to create a job. I used my bus to tug alongside churches, and faculties, and nightclubs, and I’d run 200 ft of microphone cables into the constructing, and then I might sit within the bus with headphones and a recorder and I might document those musicians, or artists, or whoever it was.
Endurance: Chuck knew from his time as a musician that renting studio area might be value prohibitive – so he introduced the studio directly to his clients. For the first few years of the enterprise, Chuck operated out of the Volkswagen bus and his 12 by 55 cellular residence on the south aspect of Fort Wayne, Indiana.
Chuck: I’d truly do the recordings within the bus after which I might deliver them to the lounge of the cellular residence. And then, ultimately, a small house on the west aspect of Fort Wayne, after which just a little greater house, after which I constructed my first 5,000 square foot building. We have been there for 17 years, and it expanded from 5,000 to just about 50,000 square ft earlier than we moved out again in 2006.
Andy: In 2006, Sweetwater moved to the northwest a part of Fort Wayne into a 50,000 square foot constructing. Chuck and his workforce shortly added on, and at this time, they’ve 400,000 square ft of area.
Chuck: The corporate, over 40 years, has just grown, and grown, and grown, and at the moment, we’ve about 1,700 individuals right here at Sweetwater and about 300 in other businesses that we own. We concentrate on selling music and recording gear to musicians everywhere in the country. They are often people simply starting to play guitar, or keyboards, or drums, or the most important names you may imagine.
Endurance: In October 2018, Sweetwater announced plans to take a position $76.four million into two new amenities at its 163-acre campus in Fort Wayne. The enlargement will double the company’s presence to 800,000 sq. ft and add greater than 1,000 new jobs over the subsequent five years. So how did Sweetwater determine to remain and develop in Fort Wayne?
Chuck: We did take a look at places outdoors of the Fort Wayne space, and perhaps someday, that may happen. There are a variety of challenges and pressures to perhaps have a distribution middle on the West Coast.
Andy: In accordance with Chuck, this strain to have a West Coast distribution middle comes from corporations like Amazon and Walmart – both of which introduced one-day delivery in the previous few weeks.
Chuck: Having fast entry for our clients is going to be necessary going forward, however we did some investigation on the West Coast, they usually have been fairly aggressive. They really…the states needed us to move on the market.
Andy: So why didn’t Sweetwater make the transfer to the West Coast? It comes right down to the truth that the corporate has had an awesome expertise operating there up to now
Chuck: At the finish of the day, the state of Indiana, and specifically this area, Fort Wayne, has been excellent to us, and we’re also in a fantastic proximity to an enormous part of the U.S. Yes, it’s a bit longer to get to the West Coast, however we will attain something like 40% of the U.S. in just a 1 or 2-day service from proper where we are, which is why FedEx has a hub in Indianapolis and UPS has one down at Louisville.
Endurance: We asked Chuck to hone in on the highest elements why For Wayne is engaging for rising a business. #1 is Indiana’s enterprise setting.
Chuck: I feel it’s an awesome place for businesses. The business surroundings in Indiana is basically, really good. The enterprise surroundings on this specific a part of the state is especially good, and that was very, very compelling to me. And if that’s not ok, we’re solely two hours from Indianapolis, and we’re three from Chicago, and three from Detroit, three from Columbus, Ohio, and I’d say, “Why not Indiana?” I feel Indiana’s an enormous advantage, so that’s clearly the large factor.
Andy: Quantity two: the native talent pool and the Midwest Work Ethic.
Chuck: The second factor I might say is I have an organization in Florida and a number of pals with businesses everywhere in the nation, and the standard of the workers here is absolutely, actually good. There’s a work ethic, a Midwest, healthful ethic, that comes by way of loud and clear. My staff work really onerous right here they usually respect the standard of life that they’ve, and it’s just a bit bit simpler, as a enterprise owner, to seek out the type of people who I might like to have here.
Andy: We asked Chuck to increase upon the local workforce as a key issue within the choice.
Chuck: It’s only about 7 months later, we’ve already crammed 250 of these jobs, but the State actually stepped up and helped with training grants, they’ve helped with some recruiting, they usually simply set an setting that makes it a bit bit simpler. You understand, it’s all the time troublesome to seek out great individuals, but undoubtedly made it slightly bit easier to seek out good individuals, and I’m just really proud of what the State has finished.
Endurance: Lastly, perhaps more essential to Chuck – even than the business setting and native workforce – are those intangible elements that make him need to continue to grow his enterprise the place it began. Number three comes right down to tradition.
Chuck: At the finish of the day, frankly, at this point, I’m just a little bit afraid to have one other location. Might I actually have the same culture that we’ve got in Fort Wayne? I’m just unsure I might duplicate that as simply, and part of our power or benefit is having this really, really deep built-in culture. I’ve relocated about 70% of our staff to Fort Wayne, and I simply need to make it possible for we keep as profitable as we will here for this region.
Andy: Despite Chuck’s want to stay, there was one stumbling block Sweetwater had to work by means of as a part of this undertaking. We’re going to hear now from John Urbahns of Higher Fort Wayne Inc.
Endurance: Chances are you’ll recognize John from a earlier episode of our show the place we profiled get together provide firm Shindigz. John has spent the final 24 years working in group and financial improvement in Fort Wayne, Indiana – and has been CEO of Higher Fort Wayne Inc. for the final six months. Right here’s John concerning the main roadblock for this venture.
John Urbahns (Larger Fort Wayne Inc.): Properly, it’s a bit of a singular venture because their campus is true on the edge of the Fort Wayne Metropolis limits. So a part of their campus is inside the metropolis of Fort Wayne and part of it’s in unincorporated Allen County. So from a venture perspective, you rapidly now convey more players to the desk. If you begin to take a look at redevelopment areas and convey within the metropolis onboard and the county onboard to help with totally different pieces of the infrastructure, it creates a extra difficult state of affairs.
Andy: So the campus being within each county and metropolis limits made issues a bit extra complicated. But Larger Fort Wayne Inc. was properly suited to handle the state of affairs.
John: One of the luxuries we have now here as being the economic improvement agency for both the town and the county, we will pull both parties into the room, work collectively collaboratively to know who’s working on the street, who’s engaged on the water strains, how can we help the venture to be sure that they have every part that they want, that they’re in a competitive state of affairs and may get the perfect deal for the company.
Endurance: We requested Chuck how this affected the undertaking from his perspective.
Chuck: There’ve been a couple little things, you realize, slightly totally different rules concerning the land improvement, that kind of thing, but I have to say, our Metropolis and our County have labored rather well collectively, and we’ve several examples where we’ve completed joint agreements with each, and one entity or the other takes management so I don’t need to cope with both the City and the County. I cope with the Metropolis on this thing, I cope with the County on that thing, and it actually has not been a problem and perhaps slightly little bit of a bonus for us because I can kind of take the most effective of both. If the County presents something pretty special, I can go back to the Metropolis and remind the Metropolis of that, and vice versa. And I feel it’s an excellent example of our Metropolis and County working collectively, and the leaders in our group and the employees within the numerous departments for approvals and all which were simply actually, actually good.
Endurance: Finally, getting to take the “best of” the town and the county was type of an advantage for Sweetwater. So Higher Fort Wayne gained the day. But John and his group at Higher Fort Wayne Inc. know that, ultimately, Sweetwater is more likely to broaden past Fort Wayne.
John: Sweetwater is a superb company. It’s a regionally homegrown firm. They usually’ve additionally acquired, you understand, very much a nationwide, if not worldwide, presence. So we all know that, sooner or later, there’s in all probability purpose that they need to be wanting elsewhere to increase. We did know that there were other places that have been very a lot courting them. Once you take a look at how some communities go after a company, they’re on the lookout for corporations precisely like Sweetwater which are on a high-growth trajectory they usually feel can be nice in one other setting. Thankfully, Chuck and the workforce at Sweetwater felt that they might proceed to develop here. I feel we know that, sooner or later, they’re going to need to broaden elsewhere in the nation. It just is sensible logistically, sooner or later. However for right now, we’re on a great run.
Endurance: The company is nicely on their approach to expanding their operations, with 250 new staff already hired in the first 7 months. In 2019, Sweetwater expects to do over $800 million in sales.
Andy: So Endurance, I know we’re going to talk concerning the takeaways of this challenge. However first, you realize, gosh, just what a tremendous company, superb progress.
Endurance: Such an fascinating story. I actually loved interviewing Chuck. He simply had such a cool story of operating his business.
Andy: Now, I’m positive in case you had a VW bus once you have been 22, you’d even be operating an $800 million firm, proper?
Endurance: I’d wish to assume so, yes.
Andy: Okay, sure, yes. The VW bus is the necessary thing. All right, let’s speak about this challenge. Endurance, you spoke with each Chuck and John. What have been the large takeaways?
Endurance: Two issues actually stood out to me. And I feel the primary is actually the significance of this business retention. I feel we’ve heard this on several episodes prior to now, but typically if the group has an excellent company that’s already growing there, the undertaking is actually theirs to lose in a variety of instances. Corporations do need to proceed to grow where they’ve put down their roots. So in this case, Sweetwater was committed to staying in Fort Wayne, and Larger Fort Wayne Inc. simply needed to assist them get there.
And the second thing I’d say is just the value of continuous to build a company culture. Chuck even talked about that he stated he’s type of afraid to broaden some other place because he’s frightened that that culture that he’s constructed during the last 40 years is perhaps going to vary, or it gained’t have the ability to be replicated in one other location. So it’s type of that intangible factor of having this culture that you simply’ve built from the bottom up. And is this going to vary my firm basically if I move it some place else?
Andy: So it seems like tradition wins the day.
Andy: So that may be a wrap on episode 60 of The Venture: Inside Corporate Location Selections.
Endurance: We need to thank Chuck Surack and John City for taking the time to share their tales with us. Thanks additionally to Kate Yurig of Northeast Indiana Regional Partnership for coordinating these interviews.
Andy: The Challenge is sponsored by DCI. We’re the leader in advertising places, and have served over 450 cities, states, areas, and nations. You’ll be able to study more about us at aboutdci.com.
Endurance: We hope you’ll maintain listening. There are lots of more tasks to return.