Oct. 16, 2007

DeJoria Promotes Philanthropy, Employee Satisfaction in Business

By Ashley Warren

Hair product magnate John Paul DeJoria examined the importance of practicing good business ethics, maintaining client and employee satisfaction and giving back to the community during a VIP Distinguished Speaker Series talk Oct. 15.

DeJoria, co-founder and CEO of John Paul Mitchell Systems and co-founder of Patron Tequila, said he learned the value of hard work and good ethics from a young age.

During high school, he worked at a dry cleaning business and still remembers when his frugal boss gave him a 25-cent raise because he had cleaned upstairs without being asked.

“It’s not what you do, but what you do when nobody else is watching,” DeJoria said. “That’s character.”

Humble Beginnings

DeJoria co-founded John Paul Mitchell Systems in 1980 with hairdresser Paul Mitchell. Electing to sell hair products directly to salons, the duo used Paul Mitchell as the brand name and market to fellow hairdressers.

DeJoria composed the business plan and borrowed $350 to match the amount of money Paul Mitchell could offer. DeJoria said the initial company consisted of an answering machine as the office and a post office box as the address. “It was bare means,” he said.

With no money for advertising, DeJoria drove from one beauty salon to another, selling Paul Mitchell products with a money-back guarantee.
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At each salon, he gave a presentation lauding the features and benefits of his shampoos and conditioners. DeJoria said he demonstrated their effects on hairdressers, knowing that if they approved of the items, they would promote them to salon regulars.

To market a product successfully, you must “smile and look someone in the eye,” DeJoria said, but “be aware in advance that you’re going to get rejection.”

In sales, persistence is crucial, he said, adding that his success stemmed from being willing to assist his customers (hairdressers) sell items to their customers.

“Do not go into the selling business, go into the reorder business,” he said.

ZERO MIDDLE MANAGEMENT

Part of DeJoria’s business philosophy focuses on maintaining employee satisfaction within his company.

John Paul Mitchell Systems has no middle management, DeJoria said, explaining that his employees enjoy their jobs and do not need supervision. In the past 27 years, fewer than 20 people have left the company.

“We keep our people,” he said.

The company has 162 people currently on staff, and DeJoria said that employees receive health benefits, free lunches, frequent company parties and good salaries.

“Many are going to retire as millionaires,” he said. “You take care of your people the way you want someone to take care of you. It eliminates turnover.”

Giving Back

In addition to his role as CEO of John Paul Mitchell Systems, DeJoria co-founded Patron Tequila and John Paul Pet, an animal-friendly pet product company.

With annual sales of Paul Mitchell products alone nearing $200 million, DeJoria has reached a level of financial success that enables him to donate generously to various causes.

However, he said he became a philanthropist as early as two years after creating John Paul Mitchell Systems, feeling he had “made it” since he could pay his bills and had $2,000 in the bank.

DeJoria recalled a time at a California restaurant when he noticed a table of 12 kids and two adults from the inner city at the next table.

He followed the waiter into the kitchen and instructed him to give the entire table anything they wanted from the menu. DeJoria would pay the bill, but he wanted to do so anonymously.

After hearing the news, the woman at the head of the table stood up and thanked her unknown benefactor, saying, “You have no idea what you’re doing for me and the children.”

Now, DeJoria’s donations have far-reaching effects. He has supported homeless Americans who actively seek employment, and his company’s financial contributions also have fed more than 17,000 orphans in Africa. His company, Paul Mitchell, also launched a new campaign called "Giving Back is the New Black."

DeJoria encouraged students to seek philanthropic causes and said the satisfaction of improving society far exceeds the gratification of material wealth.

“What you get out of it is you feel really, really good that you made a change on the planet with whatever means you could,” he said.

 

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