Big Predictions for Retail with the Visionary Les Mandelbaum, CEO of Umbra

Les Mandelbaum, CEO of Umbra and long-time member of PEO Leadership has not only been predicting the reinvention of the retail industry, he and his global team have been executing their vision of a digital economy for many years. Umbra has transformed itself from a primarily retail-driven platform to one of the world’s leading houseware companies with e-commerce accounting for more than 50% of their overall sales.  An incredible story of a company reinventing itself, listen to Les as we speak about the future of retail, the hybrid workforce, and the pressure to increase prices. 

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Episode Transcript

Leon Goren (00:00):
Special thanks to E+y for helping us bring you t

(00:02):
day's PEO leadership snippt podcast. Welcome to our snippe
s podcast. I'm Leon Goren, CEO ad president of PEO leadersh
p, North America's premier peerto peer network and leaders
ip advisory firm. Today we welcme Les Mandelbaum, co-founder
nd CEO of Umbra and longtime memer of PEO leadership. The Um

(00:24):
ra story dates back to 1979. Wen both Les and Paul launched t
e single window shade, from teir curiosity, creativity and a
passion for design to code as acompany went on to create m
dern designs for the home that baccessible in both price and a
titude. Today, ombre with its had office in Toronto has b
come a global leader in design ad distributes his products to o

(00:46):
er 120 countries around the wrld. with offices in Europe, t
e US, Brazil, China, last year ad your team have done a f
ntastic job. It's been a great Cnadian success story. And it's g
eat to have you with us today.

Unknown (01:02):
Thank you. And thank you for your help all these
years to with PEO. And yourpersonal guys.

Leon Goren (01:10):
Thanks so much last.
So I wanted to kick it off witha little bit of the future. And
and before I go to the futureI'm thinking about because I've
been really fortunate, I've satin lots of numerous meetings
with you over the years. And theone thing that I noticed and
picked up on is you've been avisionary like I remember eight,
nine years ago, what youconstantly are doing is

(01:33):
predicting the future looking atthe future, urging the team
directing the team, getting themto explore and try and figure
out what's coming next. So Icouldn't think of anybody better
if I wanted to think aboutwhat's his environment,
especially around let's say thewholesale retail environment
look like, two, three years fromtoday. It's been an incredible
past year. But where are wegoing from here?

Unknown (01:58):
Well, first of all, you have to look at what's happening
before the pandemic, what forceswere in play and what trends
were in play before that. Beforethe pandemic we saw the rise of
econ taking a major portion ofconsumers dollars and shopping
habits, even before the pandemichit. We also because we're

(02:21):
selling in different markets, wesaw what's happening in
different parts of the world. Wesaw that, particularly in China,
which is considered maybe thebiggest consumer market, and
that's certainly the fastestgrowing one over the past 15
years, that they skip bricks andmortar that sites such as

(02:42):
Alibaba, and to mall and therest, that they they had picked
up 70% of the consumer dollarswith the shopping. So that was
the norm there. And andcertainly the rise of consumers
having smartphones,so many at all income levels,

(03:06):
being able to shop andcomfortable shop on that. So we
saw that happening already. Sowe already geared the company,
and predicted that at least halfan hour or if not a majority of
our business would be Econ, ofcourse, in the pandemic kit,
that was the only game happeningexcept for a few essential
stores. So we feel that eecom isgoing to continue to grow. But

(03:30):
it's it was accelerated by thepandemic because they picked up
so many new customers that maybewere hesitant to buy just
regular household items thatthey could enjoy visiting in the
store. Older people particularlythat now that they're doing it,
they'll probably continue doingit. Of course, a lot of the

(03:52):
missed associate acts for thelow back to store but now they
have that tool in that shoppingtool and it's not going to go
away so fast.

Leon Goren (04:05):
So, you know, I guess it's been a big, it's the
last year has been a massivetransformation, right? We're
always predicting retail bricksand mortar difficulty getting it
settled out now a little bit interms of all the disruption to
that.

Unknown (04:20):
Well, I wish I wish I could say that it's settled down
but a lot of things thatdisruption is even more so in
different ways on the supplychain on different pressures
such as cost increases materialincreases labor disruptions. So
even in the markets that havebeen open for a while and us

(04:42):
being our biggest market. Ican't say that it's settled
down. It's we've seen as as themarket has reopened in the US,
we've seen a huge return tostores people are having To go
back and stores, but the storesare reporting to me that they

(05:05):
don't see as much turnover forthe body count that airs in the
store. So a lot of people arevisiting stores is sort of just
a social experience or anouting, but not necessarily
transferring to dollars becausea lot of people are still buying
on eecom. We're in the in thehome? I don't I don't know, I

(05:29):
can predict on that on what it'sgoing to be let's say next year,
but for this year. Ecommercestill growth is still the the
the acceleration is still there.

Leon Goren (05:43):
Okay, I know that's great. You touched on the supply
chain logistics, this is a bigconversation happening in in our
groups. I was in one thismorning, right? And they were
talking about price increasestaking one two, what some of
them were on their thirdpotential price increase this
year, because of raw materialsand stuff. Same I'm assuming in

(06:03):
the Home Hardware, you know,homeware businesses as well,
very much is it you think it'stemporary, or you think this is
a long term price adjustment nowthat we're going to see,

Unknown (06:14):
well, if I could predict that I would be buying
Commodities Futures that areshorting here, that, you know,
when things go up, you see thisand gas prices look looking at
what's happening to others,they're very quick to go up, and
they're very slow to go down.
People are very hesitant to oncethey've established a price,

(06:38):
unless they're forced to unlessthere's a real competitive
market, they there to reduceprices. So I really feel that it
might slow down the level ofincreases as unsustainable,
because it's just every week,it's it's been hitting in, and

(06:59):
there's a lot of fatigue, interms of going back and changing
prices and who's doing it first.
And certainly if you're in themiddle man, and you're dealing
with retailers, it's it's verystressful. But once you've
established a price, unlessthere's a lot of competition,

(07:19):
people are hesitant to lowerthat. And what's happened is
that there's less competitionthese days, there's massive
people like Amazon on the bricksand mortar, the big chains have
swallowed even a biggest biggerportion of the market,
unfortunately, at the cost ofindependence and some of the

(07:39):
specialty chains. So it's a lesscompetitive market in some ways.
So I really feel that higherprices are here to stay. And
obviously there's a politicalwill to raise the base the base
wages and that goes out throughthe food chain. So that's the

(08:00):
cost increase the rise in Chinaand their currency though or you
can say the lowering the UScurrency is inflationary.
tariffs are and and and the lackof global cooperation and open
markets is also causing costincreases the strain of not

(08:22):
regular patterns and supplychain. supply chains don't do
well with blips fast increasesand slowdowns. They can't handle
it. So it ends up with a lot ofthe pipes get clogged very
easily. So I see this is leadingto long term, there's gonna be

(08:44):
inflation. And there's gonna bea major correction once
governments finally have to facethat they have to raise interest
rates and therefore mortgagerates.

Leon Goren (08:55):
Okay, you are a predictor, you see you are
you're predicting a little bit.

Unknown (08:59):
Well, I'm not alone in this, I've got to say that it's
going to be a predictor I adviseother people to go outside their
own cocoon. One of the things Ido, of course, p OE joining po
is part of that. But I'm alsopart of, you know, a lot of
different groups. Now, othervendors in different countries,
high level mid level, I reallytry to talk to as many people as

(09:24):
possible, and network as much asI can globally. And the fact
that Umbra has a bit of a brandand a story to tell. I get, we
can punch above our weight and Iget invited to the table to talk
to you as you do too, with someof the groups you're involved
in. And you can pick up a lot ofinformation. So not only

(09:45):
information but you get aconsensus of where things are
going when you talk when youtalk to people in different
groups and I encouraged myexecutives to do the same to in
my managers to seek outknowledge. Also I read a lot I'm
I'm a bit old school, I stillread, you know, the major
publications every day. And onesthat I really think I get it

(10:10):
right, like the economist, youknow, every week plus books.

Leon Goren (10:16):
No, you do I admire you on that. It's funny because
that's what we push leaders todo all the time, right be one of
their primary responsibility toleading an organization is you
got to sort of figure outdirectionally where you're
going. And the only way to dothat is to sort of read, talk to
people outside of yourorganization, just get out of
your building. Otherwise, you'llhave no sense of it.

Unknown (10:36):
And so, you know, I, in the old days, obviously, for 10
years, I was on a plane everyweek, and when I was starting
the business, but I stilltraveled until this pandemic hit
pretty much 25% of the timeglobally, and also be on the
ground and not as a tourist,talking to business people in
all corners of the world, youreally get a consensus, it's not

(10:58):
that I'm smarter than anybodyelse. But when I'm getting this
amount of information, you getto feel of where things are
going. If you're talking andtraveling to people all over the
world. And you get some commonideas that seems to be
resonating, then you get a senseof where things are going. And

(11:20):
that's where it really workedfor me was in that 2008
recession, when that hit thefirst the mortgage defaults and
all the rest, I really was ableto restructure my business in
anticipation that early and wesurvived that quite well. So
this is similar. So I've beenthrough this a few times. And I

(11:44):
think we're coming out of eatingthis pandemic in stronger shape.
Now part of that is luck, justthe the sector that I happen to
be in. But part of it is, isreading and getting as much
knowledge as possible.

Leon Goren (12:01):
So I know we're pressed for time. But the other
thing I wanted to touch basewith you is this whole workplace
environment, right? Oh, hybridpiece today. And in your world,
I know you got a couple thingsgoing on. One is the
capabilities that your peopleare changing all the time now in
terms of leadershipcapabilities, right? You've gone
from traditional straight bricksmark to e commerce, and it's

(12:23):
accelerating. So your leadershipis changing there. But to is in
your world, also on the design,the collaboration, the necessity
be in the office andcollaborate. How is this hybrid
workplace going to unfold? Foryou?

Unknown (12:38):
Well, you know, I'm a bit old school on this, I really
believe in face to face andcollaborative environment, and
different departmentsinteracting each other on a
casual basis. A lot of stuff, alot of the magics happens here,
because we're a productdevelopment design company
almost by accident. And settingup zoom meetings are fine if you

(13:02):
have a specific goal and agendain place. But a lot of the
creative process isn't quitelike that here. So we feel part
of the our advantage is thatwomen are allowed because we're
deemed an essential service,whatever. But we're able to stay
open in some capacity, allthrough the past year. But on

(13:24):
the other hand, even beforethis, there was a big move, that
people wanted more flexibilityas to where they were, this
happened already. So in order toattract top talent, it doesn't
matter what I think, if I wantto top talent, I have to adjust
for the work for the for for theI have to market my company

(13:48):
competitively, and I have toadjust, I have to be flexible to
attract the best talent. And ifthe best talent says, You know
what? I want flexibility in mywork hours. And I don't want to
be at the office every day.
We're not going to pass on, onhaving great talent, and not
being flexible. Because less manthe bomb, the CEO has a

(14:12):
philosophy of we'd like peopleto be here. So we already had
that flexibility in place. And Ithink that's going to continue.
So the hybrid that we have nowis going to continue to some
form and we see this happeningglobally.

Leon Goren (14:32):
That's great. Well, let's thanks so much for sharing
those insight. We hit three bigtopics. I know I tightened it up

Unknown (14:40):
really Yeah, you did a great job. Yeah, we you know, I
enjoy these kinds of things andI enjoy our meetings. And I got
to say to that part of thereason I'm able to pick up
knowledge is that I shareknowledge. You only you reap
what you sow. So people that arevery nerdy don't like to are
very closed in sharinginformation. They They're not
going to get the informationthey need. People are less

(15:03):
likely to share things if youdon't share. So I my philosophy
is share as much as you possiblycan and you're comfortable with
and you'll get it back, double.

Leon Goren (15:15):
I like those words.
That's awesome. All right,thanks so much pleasure. It's
great. If you're interested inour live webcast the way forward
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(15:36):
wells, Dr. Jason, South rockchestnut, and we cover topics
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