In this Prime Talk Podcast Sponsored by GETIDA – Sam Haddad – Co-Founder and CEO of Greenhaus – a company that buys made in the USA Amazon brands. He will talk about Focusing on Amazon Businesses that Manufacture in the USA, also more information about his life’s journey. #samhaddad #greenhaus
About Sam Haddad of Greenhaus – a forward-thinking consumer product company seeking to acquire, fund, and support the long-term growth of Amazon’s private label businesses. We look for leading categories and products that are made in the USA, have strong sales history, rankings, reviews, and opportunities for scale.
Find the Full Episode Below
Yoni Mazor (Host) 0:06
Everybody welcome to another episode of prime talk today I have a special guest that I’m having Sam. Haddad. Sam is the co-founder and CEO of the greenhouse, which is a boutique house of amazon FBA brands, which is special because it’s focused on buying us manufactured products. So Sam, welcome to the show.
Sam Haddad (Guest) 0:23
Yoni thank you so much for having me. I’m glad to be here. I’ve listened to many of your episodes. And it’s an honor
Yoni Mazor 0:30
And honor to have you thank you so much for your time. Okay, so today’s episode is going to be the story of you, right? The story of some Haddad’s, you’re going to share with us? Who are you? Where were you born? Where’d you grow up? Where’d you go to school? How’d you begin your professional career, or your business career and station to station until where you are today with the world of e-commerce. So without further due, let’s jump right into it.
Sam Haddad 0:51
Great, can’t wait. It’s fun to go back and go down memory lane. So I’m excited. I was born and I was born and raised in, Brooklyn, New York spend my whole life in Brooklyn. And, you know, I went to a private Jewish school for 12 years after that, went to NYU undergrad. And believe it or not, my major was sports business. I don’t do anything with sports now. But it was great. It was a great education. I enjoyed my time there. What it is, is that they take the typical business courses and the typical business classes, and they just add it with a sports theme. So financing accounting, marketing, consumer behavior, and then tying it in with, you know, what’s going on in sports, different businesses within the sports industry. And I enjoyed it. I’m a big fan of a lot of the New York teams.
Yoni Mazor 1:52
So, you jumped, you jump, like skyrocket into a, into a lot of things. I want to come back a little bit, we’ll reach out to the sport, you know, potentially the sports career later on. Alright. Okay. So you mentioned I grew up in Brooklyn, this touches by which part of Brooklyn,
Sam Haddad 2:08
Midwood, graves, and area.
Yoni Mazor 2:12
Got it. And then when you were growing up, so you were doing sports at all? Or were you like doing any work anything entrepreneur or like your family? What kind of industry were they involved with? For example, give us a context of, you know, you grow up, what kind of environment you had.
Sam Haddad 2:26
Got it. So, you know, I come from a very large Jewish community centered around families centered around friends, religion, work. So, you know, work was always an emphasis in the house, whether it was at school, whether, whether it was out in the real world, and the family has two, I would say they have deep roots in two different businesses. So whether it’s wholesale, or real estate 40 plus years in both different industries. And so,
Yoni Mazor 2:54
But they’re always here in the United States, in the New York area, was it all over the states? Or what was the kind of dynamic for the family model?
Sam Haddad 3:01
Yeah, always here in New York, based out of New York, real estate in New York, the wholesale business based out in New York. And you know, it was interesting to see the times and how the business grew from let’s just say when I was a kid, as to where I was, you know, two years ago working for the family company, and I’ll get into that after
Yoni Mazor 3:29
Got it, deep-rooted in the community life and the fan life. And are you saying there’s one or two charts for the family one is real estate one is wholesale. So real estate in New York is by you know, pretty much self-explanatory, but the wholesale will give us a little bit of a touch of what was, what kind of products or categories or scale or dynamics were started when you’re a kid and it will touch you later or where it is currently in it’s a relevant to the story,
Sam Haddad 3:54
Got it. So you know, the company primarily manufactured imported, men’s ladies and kids soft goods. So just touch on the categories briefly. Sportswear active wear underwear, loungewear, hosiery, accessories. And, you know, the typical way of selling products to retailers was licensing brand names and creating products, under certain categories under those brand names, working with retailers, having the relationships, and being able to distribute from the top tier to the bottom tier, whether it’s a Walmart or a target, or a Nordstrom down to the dollar stores such as dollar general or family dollar. And, you know, over time, just establishing more categories, more brands, more licenses, more relationships, and eventually distributing product to as many retailers as possible.
Yoni Mazor 4:54
Got it. This business was founded by your parents, your grandparents, what was the history of the foundation
Sam Haddad 5:01
40 plus years founded by my grandfather,
Yoni Mazor 5:04
Nice. Your grandfather was born here in the US. Born here in the US.
Sam Haddad 5:06
Yoni Mazor 5: 12
Got it. So when we also New York area and founded this business, a wholesale and they don’t want to resell real estate or then for real estate or also wholesale or both of them all at the same time,
Sam Haddad 5:17
Real estate was always in the cards running both companies side by side. And I would say you know, you know, real estate is it’s not a set it and forget it. There are daily activities, daily management. But in terms of wholesale, I always believe that if you can run a wholesale business successfully, you can do anything, because there are so many different parts of the process. And it’s challenging, it’s very challenging, because every single retailer wants something different, whether it be a product or a way that you ship the product to the company or the retailer,
Yoni Mazor 5:38
And the customization that each retailer wants in their shenanigans.
Sam Haddad 5:43
100% it is, it is one of the hardest businesses to manage, in my opinion. I’m on the younger side. So I’m a little biased. But yeah, again, I believe if you can be successful on wholesale, it lines you up for success in so many other things.
Yoni Mazor 6:07
Got it. So sounds like your grandfather started the business, you know, the empire, so to speak, around the 80s that was a ruse. And then while your father stepped into the business as well and his family or uncle’s or what was the family structure was everybody in or just a few in and everybody kind of scattered rather?
Sam Haddad 6:23
Yeah, not getting too deep into it. It was my father and my uncle. And they work side by side running both of the companies. Eventually, you know, the next generation came in and I started working there full time in 2013. At that time, just dabbling in and out of the different departments, whether it be sales, production, operations, and seeing where I fit in, right
Yoni Mazor 6:53
But one thing I want to capture here is that once again, we’re gonna jump into the recent years, but when you growing up, are you are you hearing anything about the business you’re absorbing anything immersing in it or just not at all? You’re just focused on the things that you’d like to hear your hobbies or the sports or the friends or partying or just studying being a geek? What was your like, your, your daily flow? What was your like, I know children or teenagers, they absorbed right, like sponges, and what can environment where you’re absorbing as far as you can remember, you know, looking back
Sam Haddad 7:22
Big sports fan, always loves to play. I’m a massive hockey fan. I like to watch hockey, I’m a massive Rangers fan. I play ice hockey, play roller hockey. But you know, I love every other sport, whether it be football, whether it be baseball, I’m that I’m a big Mets fan. I don’t like basketball.
Yoni Mazor 7:43
Really? Okay, next I explained that it’s hard to you know, they’re not getting love. So it’s hard to love it. Yeah, I got it.
Sam Haddad 7:52
In addition to that, I always loved technology, right? I was always looking at the newest software I was always looking at the newest apps. And I really, that’s where my I would say my entrepreneurial spirit came in, always up to date with the times always knew what was going on. And it was kind of like, you know, I have this, the old world of, you know, I can go into this family business and take my version of it, right, and try to add value. And then there was always this entrepreneurial spirit, where I know what’s going on in the world, there are apps to be created. There’s so much information out there to do new things. And that was like the constant struggle back and forth. Like, what do I do?
Yoni Mazor 8:39
And so when you’re growing up as a teenager, or this is more like after you graduate or growing up as a teenager
Sam Haddad 8:46
the way that I always lived is always thinking, you know, five or 10 years ahead in the future, even from a young age I, I kind of have this anxiety gene that
Yoni Mazor 9:01
It’s called the entrepreneurial bug, it was scratching you as you were growing up and as you grow mature and older, you realize, okay, here’s the things are out there, here are the opportunities and you’re seizing it, it sounds like you’re seizing and now we’re gonna touch it very soon. Okay, so let’s kind of touch on where you went to college and you graduated with your graduated in which year?
Sam Haddad 9:20
Yoni Mazor 9:21
2015. But, you know, even before you graduate, your enter kind of the professional world or business world, and what was your, I guess, the first station in the business world?
Sam Haddad 9:27
So first station in the business world was in 2013, I started working for the family company. And just that again, dabbling in the different departments and working out figuring out what worked best for me, eventually, in 2014 decided to start my own division in the underwear and loungewear categories. You know, it was my first foray into learning about a product, what goes into it, how it’s made, all the different parts of the process, you know, it’s one thing to do go into a store and buy a pair of underwear. But then to understand what goes into creating the product is a whole different ballgame. I think probably one of the most influential times in my life was when I walked into a store and saw my product on the shelf for the first time, I think in any product creators, you know, time, and being in that in that world, to have that moment is I wouldn’t say it’s eye-opening. But it hits home, it’s a great feeling. It’s one of the best feelings that I’ve ever had. And so, you know, 2014, decided that I was going to start these divisions, figuring out what needed to be done. So obviously, the underwear and loungewear in the apparel world are different sizes, just understanding the different specs and the different materials and the different colors and knowing what the customer wants. And knowing what the customer buys.
Yoni Mazor 10:56
Do you guys have like internally like a structure or educational structure where there’s a learning program, or it’s more like, okay, you want to start your division, take a machete and maybe make a trail,
Sam Haddad 11:07
I mean, you know, boots to the ground, just going into stores walking to a Marshalls or Tj Maxx looking at what’s on the shelf, looking at the colors, looking at the materials, looking at the packaging, right? Brick and mortar, retail is all about packaging, and how you present the the product to the customer without them even touching and feeling it. So again, learning all these different things and, and combining it things you never knew before. Right? I didn’t understand the quality. I didn’t understand different material weights, I didn’t understand different types of waistbands. It was again, talk about eye-opening before it was eye-opening to know what goes into the whole process and how much work and time and devotion not only to create the product but then you got to source it, you got to manufacture it, you got to bring it in, you got to sell it, you got to the warehouse, I mean, there’s all different parts. And
Yoni Mazor 12:04
I want to jump into the cycle. Because just this is brilliant because this is the craftsmanship of the whole process. It’s not just one thing. It’s a whole chain reaction, right? So I want to touch kind of the chain reaction and things. So okay, you’re in the stores, boots on the ground understanding that. Okay, this is what’s up in the market. These are the trends. This is what’s going on this is I guess what consumers are relating to, then you create your concept, I guess? And then what do you do? What you just go overseas manufacturing it? How do you start sourcing it? How do you start manufacturing its logistics cost structures? How do you do that?
Sam Haddad 12:32
It’s a great question. So um, I guess, sometimes you got to work backward, right? Brick and mortar retailers work on price points. And depending on the retailer, there are higher price points there is lower price points, middle price points. And I think as a merchant, you need to go into a store and figure out where you sit, right? Look, look at the brands that you have, look at the quality of the product and say, am I at this retail am I at an opening price point retail am I at midpoint retail at my highest retail is my brand and a is my brand, and b or a-c, all these things, play into how you’re going to create the product and source the product. And us being let’s just say having opening price point product to start knew where we needed to be where our product costs needed to be. And so going out using the agents that we had all over the world, and sourcing the product led us to manufacture well, majority of underwear comm based underwear is manufacture in India. So I would say 90% of the production was based out of India.
Yoni Mazor 13:38
Got it. But I kind of wanna understand that. When you talk about cost structures and the product, did you limit yourself said, this is my sweet spot? I can make it happen? Or he said, okay there’s a few of them. And I’ll make a variety or portfolio of these types of products to fit this kind of retailer, or maybe on the lower price tier or in the middle or, or did you try to hit the whole spectrum? What was that?
Sam Haddad 13:59
Yeah, I think as time goes on you, you sort of realize that you can’t have just one brand and one product-specific or global across all the retailers, right, it’s just never going to work, retailers also want something different. They don’t want, you know, store a doesn’t want what store b has for a specific reason, right? Retailers, retail accounts are shrinking these days. And they want differentiation they want specialized products. So you kind of grow into this pattern where you want to good, better best and understanding what that means whether it’s a different brand or a different quality. And I may sound repetitive but it’s important when it comes to merchandising when it comes to walking into a store, you have to be able to realize where you fit in and where you want to be.
Yoni Mazor 14:59
Got it. Okay, so I just want to remind everybody here that you’re still in school meaning you’re still on NYU, university, and business sports management.
Sam Haddad 15:07
Yeah, I was taking the train back and forth six times a day, literally. My schedule was jam-packed between shopping stores between having, you know, internal meetings and, and figuring out how this business was gonna come alive.
Yoni Mazor 15:18
Back is that what it was? Yeah, it was that like, the best time of your life because you’re like, in like a crock pot, it just gets on the pressure keeps on, you know, hitting you up and, and warming you so much you were learning, you know, educational stuff on, you know, on the institutional, educational level, but then, you know, real business real world, you know, from scratch,
Sam Haddad 15:36
No doubt, no doubt, and to be able to go to a class about consumer behavior, to be able to go into a class that I’m pitching the executive, executives of fox sports, right, about some sort of crazy business plan. And then to go back to work and to, it’s not necessarily in the same field, but to implement the strategies that I learned and discussed with peers and colleagues. It was, it was incredible. It was incredible. I learned a lot I you know, I I’m in a different place now. But I wouldn’t trade that experience. Yeah, I think I’ve learned so many lessons along the way, I wouldn’t trade it in for anything,
Yoni Mazor 16:22
You’re saying you’re able to connect the dots between what was going on with the real business world experience, or you’re getting and the educational material, you can absorb it even better, because you can connect the dots, because most of the students, I would assume the theoretic, theoretics, and then maybe the years afterward, they get hit with the actual reality of things we’re going to get all the same time. So I guess was very impactful.
Sam Haddad 16:42
Correct. I’m a big believer in, in learning, but doing at the same time, you can learn all you want, you could sit in as many classes, but if you don’t have the true experience, if you don’t, you know, you know, dip your feet in the water and get that ultimate learning lesson. It’s in my opinion, it’s not as impactful.
Yoni Mazor 17:04
Yeah, it’s pretty, pretty ambitious of you to do it all at the same time. Okay, let’s go back to the business. So you read these product lines, I guess you sound like you created, you know, a multitude of them not just one single product that it’s supposed to, like a joker that wins it all. It was kind of a variety of things. So while you went to the agents, and they started sourcing and the sourcing is this what you want, boom, you got it. Right. And it was turnkey? Are there any pockets ever samples, touching it, feeling it? Give me another run? And give me this? What was the actual, you know, the creation process for you?
Sam Haddad 17:33
There were many horror stories.
Yoni Mazor 17:36
There we go. It took us a few 50 minutes to listen. That’s the real essence. You know,
Sam Haddad 17:41
Whenever you’re diving into a new category, whenever you’re diving into a new business, you’re going to have your ups and downs. You’re going to learn things along the way. But they’re going to be the best learning. They’re going to be the best lessons that you take, you know, successes about how you deal with failures. And I do believe that things happen for a reason. So going into you know, the for I would say the first horror story that we had was we figured out the different types of the different material that the material that we were going to go forward with, we figured out different waistbands, we place our first order we have a meeting with for the first time with a retailer and we show them the kids which are the which base cooter
Yoni Mazor 18:45
Animated design, right? The kids
Sam Haddad 18:52
Right. Aligned book of what we’re bringing in. And she goes, you guys have a three-pack of boxer briefs, men’s boxer briefs. And inside the pack is a black, grey, heather, and white pair of underwear. Nobody buys white underwear. Right. So now you’re bringing in let’s just say 24,000 units of this product that’s just not going to sell. Wow, great. You walk out of the meeting and your heart drops. And this is again it’s the first time now underwear is a volume-based business right? So bringing in 24,000 we made may seem like a lot it was a lot because it was the first order and you don’t have anything lined up you don’t have any orders lined up for your customers lined up.
Yoni Mazor 19:18
Oh, so you didn’t book anything. You just, you know, you’re so confident ever able to move in and just brought it in and
Sam Haddad 19:26
Everything was, was brought into stock. So basically what we did is we worked with a manufacturer to figure out a way to remake or turn the whites and the blacks or turn the whites into gray heathers. I forgot which color was
Yoni Mazor 19:41
They just dieted with a little sharpie or insert the other color in
Sam Haddad 19:48
I don’t know, I don’t know what they did. But we figured out after a certain amount of time
Yoni Mazor 19:54
To turn around a few days, a few weeks, a few months. So as you remember
Sam Haddad 19:57
No, so you know with underwear typically it’s they say it’s a three-month lead time. It’s never a three-month lead time, let’s just say four to six months. And I don’t remember exactly how long it took to change it. But that was horror story number one.
Yoni Mazor 20:15
When you, when you bet one back to that buyer, it was lady buyers, you mentioned.
Sam Haddad 20:20
Yoni Mazor 20:21
And what happens in the setup, problem solved and she absorbed and she bought it, it was good, we’re good to go. Did you patch it up?
Sam Haddad 20:26
You know, we sprinkled around the 24,000 units, and a test for everybody. For all different retailers, I believe it went to three or four different retailers to start some bought 240 units, some bought 1200 units. And that was the start. That was the start
Yoni Mazor 20:42
At the end of the day, that little project that the first batch took a hit on it financially or and then that’s like tuition, are you eventually able to make a little profit, it’s for you,
Sam Haddad 20:50
I would, I would say the strategy for the first at least six to 12 months was just breakeven, right? Breakeven gets your foot in the door, creates relationships with the buyers know the right people get an understanding of where the business is where it’s going. And it helped because you know, you can’t expect, expected as go into a business, create products, sell to buyers and, and be rich on day one. It’s just not gonna happen. You know life is a process. And when you plant the seed, don’t expect the fruits to come right away.
Yoni Mazor 21:23
Yeah, it’s not overnight. Yeah. That’s good. Okay, so take us to the next horror story. This is pretty interesting and valuable. I guess for you know, the first lesson here, try to book in order before you make a massive production of any kind as much as possible. Sometimes you just got to take a leap of faith. That’s kind of a probably a lesson learned. And also try to confirm the colors if you’re dealing with color variations. Alright, the second lesson here.
Sam Haddad 21:46
Yeah, not only just try and confirm the colors, but understand who your customer is and what they’re buying, right. If you walk into a store, and you don’t see any white pairs of underwear, take note of that. Because it’s that way for a reason.
Yoni Mazor 21:59
It’s funny because some of them can think through the note the other way, there’s no way or maybe I can break-in. So how do you measure that?
Sam Haddad 22:05
And that may be it may be but you have to do your research and you have to look into it. Interesting. Okay, second horror story. Second horror story. I mean, underwear in brick and mortar retail is all about packaging, right. And so we first started manufacturing, basic core underwear, 100% cotton. If it was heathered, it would be a, you know, a 9010 blend of con poly.
Yoni Mazor 22:29
And we say how they’re just I apologize for my ignorance. It was I mean, a heather blender mixer. What does that mean?
Sam Haddad 22:35
If you walk into a store, and you looked at a great pair of underwear, it didn’t have the heather on it, it would just be a boring, dull gray. But when you mix it in with a header, it has this gray whitish look to it.
Yoni Mazor 22:49
So what’s the other man like I mean a color or even a blend?
Sam Haddad 22:53
Blend of cotton and poly. So it’s typically and I said 9010 before, it’s really 60 40, 60% cotton, 40% polyester. And so the first line of underwear was more core basic, right? Your everyday, pair of underwear or type of underwear. As the business matures, we realize this trend of athletic underwear, performance underwear, right using synthetic materials, whether it be you know, polyester spandex, combining the two to create a spreadsheet pair, and something that you can wear, whether it’s at the gym, whether it was playing sports, something that was more dynamic. And so that type of underwear was packaged differently. Basically, in a polybag that had a Ziploc on top that had a unique design on its front and back in a pouch. And when you’re dealing with that type of underwear. I’m sorry when you’re dealing with that type of packaging, you have to get it right. So we ran or say we bought 24,000 units again, I don’t remember the number. Exactly.
Yoni Mazor 24:02
Give me 2000 to do doesn’t, you know 24,000? Yeah, but it wasn’t in the 1000s I guess. Okay.
Sam Haddad 24:10
And sometimes packaging gets accepted when it shouldn’t have and you’re dealing with now you’re 24,000 units waiting to be packed in your package and you realize that there’s getting spelling mistakes or it says made in the country of origin instead of saying made in china or made in India. And there are problems now this is not a major problem. But these are the types of things that you go through and learn along the way that you’ll say it’s never going to happen again. You know, I was brought up with the mentality of I can’t promise you that I won’t make mistakes, but I’ll never make the same mistake twice. And, you know, it’s, it’s part of life, we’re always gonna, we’re always gonna have our ups and downs, but it’s what you learn from that. That makes you into the person to the successful person over time.
Yoni Mazor 24:59
So so hold on. So when you’re paving the way and learning from all these mistakes, did you take a moment to sit down and write sops, you know, standard procedure to pave the way, you know, to the next team to come in and do it, you don’t have to keep doing it you can scale or with that kind of the dynamic also.
Sam Haddad 25:14
Yeah, not in the beginning. But as I matured and got older over time I started to, it is a very is a great app on the iPhone called notes that I have accumulated a lot of information and knowledge over time. But it only, I would say, over the past three, four years, I started doing that.
Yoni Mazor 25:38
It’s good. It’s part of the process of saying, you know, I take for granted what I know. And what I learned in Australia scratches that I heal from, I better start documenting and absorbing it into a written document so I can share with you know, teams and leadership teams that I want to create and build going forward. And you get empowered a skill tremendously from that, I believe, for any organization. So it seems like you’re already touching that process.
Sam Haddad 25:59
Yeah, I think coming into the business, even in the beginning, was very humbling, right? I thought you make product design product, you make it overseas, you bring it in, you sell it, no problem, you can sell 2 million units within a month. I quickly learned that wasn’t the case. And it was humbling. It was eye-opening.
Yoni Mazor 26:24
Honestly, it was painful, right? It was painful. To certain degrees.
Sam Haddad 26:28
I don’t know if it was painful. It just, made me realize that this is real. This is the real world, right? You need to work hard to bear the fruits of whatever comes right. And I, I never looked back. I never looked back.
Yoni Mazor 26:48
And tell me that when you mentioned earlier, when you say your first the first time the product in the store, what was that product, the underwear? Was it the sports or the one before that with the 24,000 units where you had to change the color? Or was that I mentioned to you, you went to the store and saw your product was that those batches are later on?
Sam Haddad 27:02
I don’t remember, it may have been the loungewear product, which was easier to make. It’s, not as complex.
Yoni Mazor 27:09
And when you went to so you went randomly to the store to shop, you’re not looking for a different product. When you go there. You want to see how it’s shelved how it’s packaged, right? You’re saying you’re shopping and then boom, you see it? That was kind of the moment that hit you.
Sam Haddad 27:20
Yeah, it was. As I said previously, it was one of the craziest feelings knowing that you put all your hard work and you know, with Amazon, it’s, it’s a little different, right? You’re not it’s a virtual listing, and it’s on a marketplace. But when you walk into a store, and you see it and you touch it and you feel it in, and you can see one unit hanging on a hanger is all the hard work that you put into making this product over the past six to nine months or even on some cases, six to 12 months.
Yoni Mazor 27:55
Magical moment. Yeah, it’s pretty cool. Okay, so I want to I guess, start moving forward and paving the way to the next stations. So you started 13 to 14 to set up your vision, to 15 you already graduate from college? And was your next station? What was your next evolution?
Sam Haddad 28:09
Well, in 2015, I also got married, so I had a lot
Yoni Mazor 28:13
Oh, very good, yeah.
Sam Haddad 28:17
Thank you, I got married on the younger end. But, you know, that was also part of the journey and realizing where I was where I wanted to be where I was going. And, you know, over that time. So in addition to running the underwear and divisions, as I said in the beginning, I was always forward-thinking, right, I always knew what the next wave was. So whether that be ecommerce or whether that be Amazon, I knew there was a gaping hole for me to come in and take that business or that aspect of the business to the next level. So we own some brands in-house and I created some direct consumer websites. But in addition to that, I took the products amongst all the different divisions and launch an amazon business where first we were selling to amazon as a one p vendor. There are challenges with that. And it’s, there was just not a lot of control, eventually transitioning that business to a third party FBA model and strategy. And that’s where my amazon experience started. So that was probably back in 2015. Where I was going to Seattle, I was meeting with dams and gmms. And that’s where the divisional merchandise manager.
Yoni Mazor 29:32
Give us a breakdown of the income
Sam Haddad 29:35
And then on top of the DMM is a gmm, which is the general merchandise manager, which is probably right under the VP or it depends on the company. But, but they gave me a lot of information as to how amazon works as to what the algorithm is about. And I still look back to those notes today. I don’t usually take notes in meetings. Believe it or