Making the "Safe" Business Bet
Dominik Von Ribbentrop
Dominik von Ribbentrop is the Founder of Stockinger GmbH, a manufacturer of high-tech, luxury safes. Since October 2003, Dominik has built a reputation for creating the safest and most stylish customer-specific safes in the world. He can be reached at [email protected].
Success can happen when you least expect it. I found that out first-hand. After selling my Internet firm in 2003, I decided to travel abroad in search of the perfect buy-in opportunity. My goal: to find the proverbial “sleeping beauty,” a company worth investing a little money and tons of energy into. While in Germany, I considered 30 diverse – and sometimes run-down – companies, but nothing caught my eye.
It wasn’t until I stumbled over a dilapidated company that my professional life changed forever. I discovered a business that had been successful until the death of its owner and collapse of the luxury industry, post-9/11. Stockinger, a manufacturer of high-tech luxury safes, was in dire need of help.
Intrigued with their extravagant products – they reminded me of high-powered Porsche GTs – I purchased the company and started observing the rapid economic development of Russia, China and the Arab region. My goal was to understand their appetite for status symbols, desire to mimic the “successful and luxurious” West and to see where expensive brand sales were the strongest.
When I bought the company, reality hit me hard. Had I made a “safe” bet? During the first two years, I wasn’t sure I would be successful. I had a product that was 10 times more expensive than traditional safes and nearly impossible to deliver. I had the passion, but was there a market for my product?
I quickly discovered that being enthusiastic about a new company is important, but it did not protect me from making mistakes. In the start-up phase, I let a friend of a friend build me an IT system because I was told, “he is great and cheap.” Cleaning up the mess he made turned out to be more expensive and time-consuming than if I had hired experts in the first place.
I also decided early on that we needed a flagship showroom in the middle of Munich. Having a beautiful, central showroom for my safes would benefit those customers who came through once a year. I immediately learned that running a showroom is incredibly expensive, that you need to have the perfect decoration and you need to be present six days a week— what a nightmare. To this day, I have 40 times more visitors going to our website than our showroom!
Ultimately, I’ve learned that in the first 24 months of starting a business, you just won’t know the important details of the market you’re in. The likelihood that you’ll make mistakes and have to adjust your business model is high. But like all entrepreneurs, this adversity motivated me to succeed.
My vision for the company was to exploit the niche market. I dreamed of creating secure, German-made, high-tech luxury safes with better designs and electronic systems than standard safes. Our quality customers deserved to have high-end products, but with a limited market, steering the company back into the black would prove arduous.
I found my light at the end of the tunnel through brand-building and direct marketing. I had to increase brand awareness on an international level. I built a system that gave me direct contact with each customer. Knowing exactly what customers wanted proved to be beneficial to my work model. I also realized that the traditional sales channel of “producer-wholesale-retail-customer” ate too much margin and was needlessly complicated for middlemen. I needed to promote Stockinger through an innovative marketing campaign.
I hit the marketing lottery by creating awareness through press, advertisements, a website and other excellent communications collateral. I also introduced a program that fostered cooperation
with select partners of target countries. I concluded that many people knew someone interested in our safes and were eager to spread the word— it was a Tupperware approach for the luxury
In many ways, the risks I took taught me that vision and determination, no matter how unique the product, are essential ingredients to success. More importantly, my ability to meet the demands of key customers kept my international dream alive. With the right business approach, I was able to reach new levels of success.