The Moodie Davitt Report brings you the latest column
in our Spirit of Independence series, in association with Tito’s Handmade Vodka. The series focuses on family, independent, entrepreneurial companies in travel retail, and on the personalities that lead and shape them. In this edition we speak to Scott Halpern and Matthew Greenbaum, directors at leading US duty free retailer International Shoppes, about their influences and values.
The Moodie Davitt Report:
Q: Where were you born and raised?
Scott Halpern: I was born in Englewood, New Jersey and raised in Tenafly, New Jersey.
Matthew Greenbaum: I was born in Mineola, New York and raised in Westbury, a suburban town on Long Island.
Q: Tell us about your early career, and about how and when you entered the duty free business.
Scott: My start in the industry was in 1977 at the age of one. It was at the IAADFS show, which at the time was held at the Diplomat Hotel in Fort Lauderdale. My grandfather Fred Rosenberg was one of the founders of the IAADFS. Since then I have only missed a handful of the shows. I worked for the company during holidays and summer breaks, but officially entered the company full time in 2000. With a background in publishing, marketing and sales I started our catalogue division selling duty free goods to the diplomatic community in New York.
Matthew: After graduating from Cornell in 2001, my first job was as an investment banking analyst at a Wall Street firm. I very quickly realised that was not my path and the timing worked perfectly with International Shoppes’ decision to expand its Diplomatic Division to Washington, DC. I worked as an account executive in that division for three years before returning to the corporate offices in New York in 2005. I was taken under the wings of Steve Greenbaum and Michael Halpern, who began sharing all of their knowledge of the industry and our company. They continue to share their perspectives and counselling today.
Q What was it like when you began?
Scott: International Shoppes was a much smaller company, with duty free (beauty & fashion only) and news- stands. Our main business serviced Pan Am and TWA at the time. It definitely seemed to be a simpler time in the industry, as consolidation on both the vendor and retailer sides had not yet started.
Matthew: It was great and weird for the same reasons. The entrepreneurial family environment allowed me to go in many different directions which allowed for a lot of freedom and the opportunity to very quickly put my fingerprints on the company. This was a big change from my experience in investment banking at the large multinational companies that I had worked for in the past, and it both thrilled and frightened me.
Q Has the business changed much in recent years?
Scott: All businesses are constantly evolving, and the duty free sector is no different. The most impactful change that we have seen is the smart phone and access to the Internet.
We used to see consumers come in with lists and sometimes they had pricing that they expected in their domestic markets. Today the consumer can see pricing from all over the world (domestic or duty free) in seconds. It’s an obstacle, but at the end of the day it’s making us a better retailer.
We pride ourselves on creating a unique atmosphere that allows the customer to feel comfortable in our stores and converts them from browsers to shoppers. We also
work extremely closely with our management and sales force to convey the International Shoppes message. Furthermore, we are developing our own e-commerce platform to better service those customers who prefer to shop online.
Matthew: During my tenure we have grown from less than 200 employees to over 600, forcing us to manage differently because of this change in scale. This resulted in an increase in middle and upper management, creating more of a hierarchy within our organisation. Balancing this growth with our ‘mom & pop’ roots has been a challenge but a necessity. The proof of this strategy’s success is that many of those 200 employees are still with the company today.
Q If you had to name one highlight of your career to date, what would it be? And a single low?
Scott: The highlight of my career is to be able to work side by side with my family. My grandfather who started the company with Matt’s grandfather (Herman) is still alive and able to watch us build from the foundation that they started 60+ years ago. Their enthusiasm is embedded in our DNA. The fact that three generations from two families have been able to manage the company and continuously grow is a tribute to our dedication to the business.
The most challenging time for my professional career was being in JFK Airport the days after 9/11. It was as if time had stopped for the world, and especially for New York. At the time JFK was the pulse of our company and to see the airport come to a grinding halt was unthinkable. On the reverse side, the best business milestone was being able to work through that period, adjust to the events and come out stronger without laying off a single employee.
Matthew: It has been a true privilege to work alongside my family and to enjoy our successes together. I cannot think of one particular low point that has made a lasting impression upon me. We have had a great run!
Q Who have been the major influences on you in your time in the industry, and the people you have respected the most?
Scott: It goes without saying that my grandfather, father and mother have been the most influential people in my professional career. I have always felt that I have big shoes to fill. I strive to build upon their passion for the company. In addition the entire International Shoppes family of employees push me to be the best I can. We have tremendous dedication, and I know that the decisions that International Shoppes management team make every day have an impact all of our lives.
Matthew: I’ve had the pleasure of working with a lot of great people both within our organisation and outside. There is not one particular person that I can identify, but I feel the greatest respect for the members of our team who show up to work each and every day with a great attitude and appreciation for their role and for the company. International Shoppes would not be what it is today without the dedication of its many great employees.
Q You are synonymous with your family company. Tell us about its values, and yours.
Scott: The core values that were instilled in me as a child are still the same core values that my family infuses into our company. Treat everyone in your path with respect and live by “treating people as you wish to be treated yourself”. As a family business it has always been important for us to make sure that our team knows that no job is too big or small for us. My father always likes to use a bicycle tyre and its spokes as a business model. It is our job to be the centre of the wheel to hold the spokes up and keep it going round and round.
Q In a business dominated by big organisations and big brands, is there still a role for the independent, entrepreneurial or family spirit? How should that be nurtured?
Scott: There is definitely a role for independent companies. As a family business, we believe that we can make decisions faster than most companies and react in a way that will maximise revenues for our company and the airports that we service. The big brands have come to benefit from this as well, as we are able to react to the trends of the world and buy accordingly.
Matthew: The consolidation in the industry (on both supplier and operator sides) has changed the playing field. The expectations of our customers have generally increased, challenging us to consistently raise our game. Our ability to work nimbly and make quick decisions allows us to meet or exceed those expectations, thereby positively differentiating us from our competitors, despite their increased size. Our business partners (landlords, suppliers, etc.) have recognised this difference and rewarded us with their continued trust and support.
Q If you have a philosophy that guides you in your career and life, what would that be?
Scott: My philosophy is to maintain a balance of work and play. As a company we are open virtually 24 hours a day, seven days a week, 365 days a year. I have worked the 4am shift and been there for the 2am closing. My role at International Shoppes is 365 days a year, 24 hours a day. In between my hectic work schedule, I make sure that I maximise my hours with my family and doing the activities I enjoy (golf, soccer, skiing, surfing, hiking and mountain biking).
Matthew: Be true to yourself and be who you are. This sounds easy enough, but I’m sure many would agree that they have felt pressured to make decisions or act the way they think others would want them to. I always try to make decisions that I feel are best for the company, despite how they may be received by others. Similarly, I encourage my business associates (suppliers, employees, etc.) to be themselves, as I do myself.
