Delivering Newspapers Taught Me What I Needed To Be An Airline CEO

Paper newspapers are largely a thing of the past. I regularly stay at hotel in the Dallas area that lays out copies of the Wall Street Journal, New York Times, and USA Today. By the end of the day, only one or two have been taken. It’s easier to scan on a phone or tablet, and this makes it easy to search, too. Some traditional papers offer bundles for digital plus paper versions, and this keeps some paper versions alive. Over the coming years, paper newspapers will continue to become a smaller share of how we get our news.

But back in the 1970s, paper newspapers were a main source of daily news for most households. At 12 years old, I got a job to deliver papers in my hometown and over the next six years, I got a better education than many get at expensive business schools. As I became a CEO, I still relied on the lessons learned from joining, and then growing, this delivery business.

Customer Service

There were three aspects of great customer service in this business — putting the paper where the customer wanted it, ensuring the paper was dry, and having it there when they woke up. Each one of these issues affected my actions and I found that optimizing each of these led to better repeat business. The “where”issue was surprisingly varied, including mailboxes, mail slots, porches, inside the screen door on a porch, milk boxes (where milk bottles used to be delivered, and many homes in my hometown had these), screened patios, and garages. Each customer had a preference and learning that choice and delivering in that spot was probably the second single biggest thing that allowed me to grow the business.

The other two issues were related. Papers were delivered to my house at about 4am. On good days, I could load up the basket on my bike and get to work. On rainy days, I would take the time to triple-fold each paper and put it in a plastic bag that the paper company provided for me. That meant I started my route later, so sometimes would need to vary my deliveries based on the customers I knew were especially early risers. Having the paper be dry and be there when the customer got up essentially guaranteed a subscription renewal, a good tip, left over candy on Nov 1, and an occasional prom date request from the customer’s daughter.

Marginal And Average Cost

The town I grew up in, Rome, N.Y., had an evening newspaper that almost everyone received on a subscription. I delivered a morning paper from Utica, N.Y., the city about 15 miles away. A much smaller percentage of households subscribed to this paper, so my route was much larger geographically than the evening newspaper carriers. Originally, I would deliver to only one or two houses on a block.

In my first few weeks on this job, I noticed that I was was traveling by hundreds of houses but not delivering anything. I began to realize that I could grow the business significantly, without riding my bike any further, if I could get more houses to subscribe. While I didn’t think of it this way at the time, I was internalizing marginal versus average cost concepts. I couldn’t set the price of my product, since the newspaper company did that. So each new house brought almost 100% margin to the operation.

As a wholesaler who sold at retail prices (other terms I never thought about then), I remember clearly my first week on the job. After I collected the subscription fees from my customers, I had $90. I also had a bill from the paper company that I had to pay within three days from the end of the week. The bill was $72. I remember the $18 and thinking “I earned this from the work I did,” and no single thing in my upbringing was more influential in the business way I still think. I also realized that growing subscribers could make this business so much better, and yet require not much more work on my end.

Prudent Investment

Investment in this tiny business started with buying extra newspapers each week. I started with 48 customers, but realized that I passed by hundreds of houses along my route. Taking a block-by-block approach, my goal was to offer a free week of deliveries to each house I passed by each morning. With the paper, I included a note that introduced myself (including a picture), outlined my customer service pillars, and invited them to subscribe and get this service ongoing. This was hugely successful, as a large number of homes who got the week free ultimately became regular subscribers. Within two years, I was delivering to over 150 houses. This was a tripling of the business I first joined.

At this point, the newspaper company noticed and asked me what I was doing to grow the subscription base. When I told them, they offered me five newspapers per week for free to keep the effort going. With their support plus still some investment buying from me, by the time I ended my service at age 18 the route had over 300 customers, but was still not geographically any larger. The route was now six times larger than when I started.

The other investment came in both capital and time. My initial bike basket struggled once I got to 100 papers, so I had to buy a bigger, more substantial basket. Once I passed 150 houses, I had to split the route and go back home to reload after the first group was complete. The papers didn’t come any earlier, and initially I would be done in under an hour. As the route grew, I often would get home just in time to shower and eat a quick breakfast before going to school.

Proper Prioritization

High School kids are often busy and have to prioritize well. One of my biggest fears then was that I would wake up late and not have time to make my deliveries. I delivered Monday through Saturday, so welcomed no alarm on Sundays. Once I turned 16, I started working at a different job after school as well and the combination of these helped to finance my college. But doing well in academics, competitively playing the trombone, and wanting sometimes to just play around meant that I always had to be realistic about what I could do and what I could safely ignore. The time management skills learned in this time have served me all my life so far.

Running An Airline

Running an airline is a lot more than delivering newspapers. But business is a mindset as much as anything, and what I learned during these six years helped me run a large company. The biggest and most important thing I didn’t learn then was how to hire, train, and lead people. But being more confident in things like managing cost of goods, customer service, reliability, time management, marginal cost and margin accretion, and efficient network design gave me time to learn the leadership skills.

I often wonder what jobs are available for teenagers today that do for them what my paper route did for me. That said, I wouldn’t want my son to get up at 4am each day to do this even if that were available. We all are the result of the experiences we’ve had, and in my case a job that seemed like a good idea at age 12 ended up becoming a significant operation that was very fortunate for me. As I have looked to hire people, I often find that those whose family ran a small business when they were young often have skills that translate very well to the modern business environment. Small businesses really are the backbone of our economy!

Source: https://www.forbes.com/sites/benbaldanza/2023/05/18/delivering-newspapers-taught-me-what-i-needed-to-be-an-airline-ceo/