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Lesson #2: Practice “restraint in regard to immediate profits”

Article Overview: Friends and foes alike thought Wrigley Jr. had gone mad at times, giving away free products relentlessly as he was prone to do. But what other saw as irresponsible, Wrigley Jr. saw as a concerted effort to take a long-term view with regard to his business and its success. After all, he had already put in years of hard work learning everything he could under his father, and he was not about to throw in the towel any time soon.

Lesson #2: Practice “restraint in regard to immediate profits”

Friends and foes alike thought Wrigley Jr. had gone mad at times, giving away free products relentlessly as he was prone to do. But what other saw as irresponsible, Wrigley Jr. saw as a concerted effort to take a long-term view with regard to his business and its success. After all, he had already put in years of hard work learning everything he could under his father, and he was not about to throw in the towel any time soon.

"I have sometimes been asked what single policy has been most profitable in our business," said Wrigley Jr. In his opinion, what was the single most important factor behind his success? Was it the product itself? Was it the long hours that he worked? Was it the premiums he offered or his advertising? In fact, it was none of the above.

"I have always unhesitatingly answered, restraint in regard to immediate profits," answered Wrigley Jr. "That has not only been our most profitable policy, it has been pretty nearly our only profitable one."

In everything he did, even in offering free sticks of gum with his each and every can of baking soda he sold, Wrigley Jr. took a long-term view, aiming for a bigger pot of gold at the end of the road. Instead of seeing profitability as something that could interfere with his goals, he presumed that the profits would come after seeing his goals through.

In 1919, Wrigley Jr. bought Catalina Island, off the coast of California, and began a process of improving it with public utilities, tree planting, and erecting new properties, including a hotel, and a casino. His long-term goal was to protect the Island for the enjoyment of generations to come. A lofty goal, Wrigley Jr. bought the island for $3.5 million, and invested over $7 million in it over the years.

"Eventually," Wrigley Jr. said of his activities on Catalina Island, "I'll make up the cost by taking the smallest possible profit from an increased number of visitors." The key word here for Wrigley Jr. was ‘eventually'. He was not looking to make as much as he could from Catalina in as little a time as possible. He was planning on making this a lifetime investment, something he could pour his time and money into over the years. Whenever the profits came would be sooner than expected for Wrigley Jr.

It was with this attitude that Wrigley Jr. approached everything he did. Business, like life, could not be rushed into and rushed out of on a short-term basis. It required thought, it required planning, and it required patience for restraint. Those were three things that Wrigley Jr. had.

But it was not just about sitting back and having the patience to wait for success to come his way. Wrigley Jr. worked hard to achieve his goals, and once he set the plan in motion, he had the patience to wait for the results to speak for themselves. Wrigley Jr. was in business for the long-term, so he could afford to think that way.

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Article Tags: 5 million, baking soda, coast of california, concerted effort, foes, generations, gum, key word, lofty goal, long term goal, pot of gold, practice restraint, premiums, profitability, profits, public utilities, regard, single most important factor, wrigley jr



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