Founder’s Letter: Material Exchange buys Olah Inc.’s Textile Division
I was once a Toronto Blue Jays season ticket holder. In 1991, Major League Baseball decided to have its annual All-Star game in Toronto and, much to my shock, a buyer was willing to pay thousands of dollars for my tickets to the home run derby. I can’t remember what I bought with the proceeds, but I am sure it was something fun or funny to be shared with my family.
In 1983, I sold my first car and used the funds to buy a better car. The better car was given to a dear friend in 2001. That car now lives in Portugal, where my friend rebuilt it and has plans to give it to my grandson when he is old enough to maintain it. Over the course of my life, I sold two houses. Other than that, I have not really sold very much— other than denim or fabrics for casualwear.
Our textile company was started in 1959 by my father, not because he had a dream to be an agent — quite the contrary. He could not stand sales or salespeople. He was a former mill owner from Hungary who was only in Canada because he fled his country after the communists snatched his factory, home and assets. As a refugee in Toronto, he had no real work opportunities and became an agent out of desperation to survive. He was angry not to be a mill owner any longer and he never showed much interest in things that were fun or funny. But he was very effective professionally and he was acutely motivated to succeed.
I joined his business as a summer sales intern in June 1973, two days after I finished high school. Somehow, I sold things literally the first week at work and raised eyebrows when I secured one of the company’s largest orders of the year in August.
I thought the business was a funny joke. So sunny and easy. All I saw was how much fun it was to take samples of stuff I liked and hunt down someone who liked it as much as me. What could be more simplistic than that and how fun was it to meet so many new people? I got paid a commission and my compensation that first summer was 400% more than I expected to earn. My pay was so handsome, I decided to continue selling while at University. Needless to say, I never quite finished four years of post secondary school education. I eventually lost interest in academia, preferring my samples and identifying and working with customers. I loved going to stores to see what products we were missing. I constantly energized myself asking the obvious rhetorical question, “if I can do this well knowing nothing, how well can I do once I figure out what I am supposed to know?” Of course, living at home and having low goals made it easy to reach or beat low expectations at that age.
All these years later, selling our textiles division to Material Exchange feels different than selling anything I had ever sold before for many reasons. There were enormous considerations regarding our staff and team. Would they join me in my new vision? Would Material Exchange treat them as they deserve? There were thoughts for the suppliers we represent. Would they get the service they expect and deserve? And, of course, there were questions about what it all meant to me and Material Exchange. What did they want from us? Why buy us? What was in it for me?
Over the last year, Material Exchange and Olah Inc. did a lot of business through our Kingpins Exchange. In that process, we got to know each other very well. It’s said you never know anyone unless you live with them or work with them. The first thing everyone at Olah Inc. observed working with Material Exchange was that the work was incredibly fun. We have enormous admiration for their corporate strategy to digitize our industry and their ability to deliver on time all that was promised with grace, elegance and professionalism. They were not perfect, but they were perfectly human — decent, smart, empathetic to customers and, in all cases, kind. We developed respect for the team they built, those people’s values and humanity. In addition, their CEO, Darren Glenister, and I communicated more than a lot. We texted daily and discovered that we shared many of the same visions, strategy. aspirations and values. We see the future of the fashion industry’s supply chain the same way. He believes in sustainability and he believes that it’s his company’s responsibility to do something about it — not just talk about it.
We carved out our sales agreement because we all (our team and theirs) found compatibility and trust and are confident that we can all do a lot more and better-quality work together than apart. In the end, we see endless opportunities for our suppliers, colleagues, customers — and even our competitors — to work together to develop a new eco-system that improves the lives and quality of work for all of us in this business. We can do more business and we can do it more efficiently.
When we started the Kingpins Show, I remember people asking me why we would ever do an event that often highlights our competitors. But in the end, all exhibitors or sales companies are on the same bus. What is important is that the bus be the best bus possible. Our job is to satisfy customers and a great bus is what customers need.
While the news is that I sold our textile division to Material Exchange, the truth is I have simply relocated our textile division into Material Exchange. I have not sold baseball tickets or a car or a house, I have simply taken something I owned and entrusted it to someone who can, with our assistance, make it better than it ever was — much like my car in Portugal. Our team is not gone, we have not even left our office nor do we plan to! What we are doing is improving our services and making them available to everyone.
We all know — and grudgingly admit — our industry is a mess. Regardless of the statistics Sourcing Journal or other publications offer about how great sales are for some folks, no one is comfortable in the current situation. We know that whatever we were doing in the past is no longer working as it should. Those whose businesses are doing well right now know it’s because a lot of other companies are in pain. Containers are not easy to find, and they’re costly. Fiber and chemical costs are skyrocketing and the concoction of politics between China and the USA together with ongoing pandemic issues is a constant reminder that we are all on unsteady ground. We all know in our gut that what goes up will also eventually go down. And what goes up fast and furiously goes down like an untethered elevator full of people.
Material Exchange’s potential impact on our business is great. The business started out just digitalizing materials and textiles. But it can — and will — digitalize inventory, as well as countless other elements in the supply chain that are currently stuffed in email or invisible. It’s worth remembering that Netflix started out sending us physical DVDs.
Political revolution is what brought our company into existence. Joining Material Exchange will allow Olah Inc. to assist in the ignition and cultivation of another revolution: How textiles are sold and purchased and how supply chains can be improved. We can and will facilitate a new environment for all salespeople and buyers who need to see and learn about new products — not just in denim, but in our entire industry.
Can’t wait to get going on this.