When Students Become Teachers : Three Loyola Seniors Help a Santa Monica Firm Lock Up Profit

Two months ago, Michael Howell, owner of Santa Monica Lock & Safe Co., opened his store, his books and his mind to three eager seniors at Loyola Marymount University working on a small business consulting project.

So far, his willingness to listen to suggestions has paid off. After reviewing Howell’s accounts receivable, the students persuaded him to call customers who owed him money.

Within weeks, he collected $10,000.

“What gets you in trouble is when you think you don’t need help,” said Howell, who has worked at the store for 16 years and owned it for 10.

Howell is the latest beneficiary of free or low-cost consulting help offered by universities throughout Southern California. The Loyola program has existed since 1972. Similar programs offered at UCLA, USC and Cal State Los Angeles also got their start in the early 1970s, and thousands of small businesses have participated.

The John E. Anderson Graduate School of Management at UCLA, for instance, figures that it has sent teams of MBA students to about 1,000 companies since its program began in 1972. The school is looking for companies that are at least 5 years old with sales of about $5 million.

“Our students are young, but what they can do for a business is astounding,” brags Fred Kiesner, the Loyola professor in charge of the school’s small business consulting program. “An interesting thing happens as the students move from the first fumbling, bumbling stages to a point where they can go out there and really help the businessman.”

Since September, Loyola students Michael Keenan, Christopher Taylor and Robert Craig Ell, all 21, have scrutinized every aspect of Howell’s lock, safe and key-making business. They have critiqued his merchandise and dissected his inventory system.

When they were calculating his advertising budget, the students added up how much Howell had spent on Yellow Pages ads during the year and were shocked to find out that it was more than Howell earns in salary each year.

In response, Howell now plans to cut the number of ads and redesign those he will keep.

The students also pointed out that his simple and unadorned merchandise displays needed to be more eye-catching. They recommended that he place more attractive items near the cash register to encourage impulse buying.

Howell responded by placing a small, fireproof safe near the cash register and displaying a collection of small novelty safes disguised as soda cans, oil cans and other household products.

His energetic consultants also fought and won a small battle with Santa Monica City Hall on Howell’s behalf.

For years, Howell said, he has objected to a city bus bench in front of his store, believing that it not only blocked access but served as a place for transients to congregate. He was also peeved that a city-owned parkway tree obscured his sign.

After much work, the students were successful in bringing out city workers to trim the tree but failed to persuade officials to move the bus stop to a different location on Pico Boulevard.

On a recent morning, Kiesner observed his students at Howell’s business as they were flipping through notes and involved in an animated conversation. “This is a tough case because Howell’s business is in good shape,” whispered Kiesner. He said the easiest company to advise is a start-up because the students produce a business plan right out of the textbooks.

In this case, Howell was matched with the student consultants after responding to a questionnaire from the school. Other businesses are matched through the U.S. Small Business Administration’s Small Business Institute. The agency maintains a list of programs. UCLA and USC business schools, for instance, send MBA students, while Loyola and Cal State have similar undergraduate programs.

The students are enthusiastic about the experience. Loyola student Michael Keenan said he has enjoyed working with Howell because “we tried to pick a case that was representative of a down-home, American business.”

“We are a benefit to Mike, but he is a benefit to us,” said Robert Ell, another team member. “We are going to remember this and be one step ahead of everybody else who graduates in June.”

After closely observing Howell’s management style, Christopher Taylor said the team plans to suggest that Howell try to be better about delegating responsibility to his employees.

“He doesn’t delegate very well,” said Taylor. “when he’s not there, things kind of fall apart.”

Howell said he tends to keep a tight rein on things but added that it may be in response to a recent hiatus when he left the business to others and spent his time playing golf and improving his health. During his absence, he said “things got a bit out of control.”

Howell said he has welcomed the students’ suggestions and is looking forward to receiving their final report. He may not take all their advice, but at least it’s a start, he said.

He’s tidied up the store, rearranged the merchandise and put his books in order. “For 10 years,” he said with a smile, “I’ve walked in the back door and never looked at the dust.”

Are you a small business owner looking for a little advice from a team of business students? Here’s how to obtain information:

Small Business Administration’s Small Business Institute: 213-894-2956.

Cal State Los Angeles: Undergraduate students majoring in entrepreneurship can receive credit for working with a company, according to Marshall Reddick, director of the school’s Institute of Entrepreneurship. “Over the years, we have helped between 2,000 and 3,000 businesses.” Through another program, students and professors provide a variety of consulting services for a $2,000 fee. Contact Reddick at 213-343- 2971.

Loyola Marymount University: Fred Kiesner, 213-642-4569.

UCLA: In addition to the MBA consulting for companies with $5 million in sales, the university also has an entrepreneurship program available to help smaller companies. To contact the MBA program, called field study coordinator Linda Newton at 213-825-2525. For the entrepreneur program, call 825-2985.

USC: First-year graduate students at the business school participate in a management internship program. Working in teams of five, the students present both oral and written reports to the companies they assist, according to spokeswoman Joan Hill. USC asks each company involved in the program to contribute about $5,000 to the school’s scholarship fund. Companies served range from multinationals to small businesses. Contact Joan Hill at 213-743-0526.

‘Start-Up Kits’

Frustrated by the tangle of government requirements necessary to start her own computer cable business, Carolyn Usinger put together a “Business Start-Up Kit,” which is being distributed by the California Chamber of Commerce.

“I spent hours waiting in line for forms, studying the forms’ instructions and deciphering due dates,” said Usinger, who has a master’s degree in business from the University of California, Berkeley.

“Unfortunately, I realized I hadn’t asked the right questions and the government forms still sat on my desk waiting to be completed,” said Usinger.

So, she put her business on hold and developed a well-organized kit with actual forms to be filled out, reminder stickers to place on calendars for important tax deadlines and addresses of government agencies.

One kit is designed for people setting up a sole proprietorship. The other version is for employers ready to begin hiring employees. The kits sell for $25 each and are available through many local chambers, or by calling (800) 331-8877.