EconTalk |
Maxine Clark on Building the Build-a-Bear Workshop
Mar 14 2022

2022/03/Buildabear_logo-300x144.png Stuff it, fluff it, stitch it, dress it: Build-a-Bear Founder and former CEO Maxine Clark built a retail-entertainment empire by letting people make their own furry friends. Two hundred million of them. What's the secret to her success? Listen as she tells EconTalk's Russ Roberts how she developed a customer-focused culture, why she sought to join (and not beat) her competition, and about some of the (seriously) strange things people have stuffed into their bears.

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Explore audio transcript, further reading that will help you delve deeper into this week’s episode, and vigorous conversations in the form of our comments section below.

READER COMMENTS

Luke J
Mar 14 2022 at 9:24pm

I find I really enjoy these episodes in which Russ interviews business owners. Maybe they’re inspirational, or maybe it’s nice to hear from passionate people who are not entirely jaded by politics.

Her linked webpage indicates she’s focusing on helping women and minority entrepreneurs as well as improving K-12 education. It would have been nice to hear her take on these topics, but I appreciate the episode all the same.

AtlasShrugged69
Mar 15 2022 at 5:17pm

It’s remarkable to me that many of my millennial friends could look at the accomplishments of someone like Mrs. Clark, and conclude that this is capitalism at it’s worst; Someone taking advantage of the innocence of children to line their own pockets. They would be correct, of course, but the thing to remember is this: without build-a-bear, children would have to suck it up and buy Walmart Bear, which only comes with two outfits; or even worse: Government Bear, which is just a picture of a bear with some fur stuck to it, and is on back-order until 2024

Shalom Freedman
Mar 16 2022 at 7:41am

Once again, a Russ Roberts interview touches upon a subject I am almost completely unfamiliar with. Yet Maxine Clark’s story of building a business empire out of an initial understanding of child’s suggestion of building at home its own stuffed animal is an interesting and heart-warming one. She comes across a very positive, smart businessperson and very decent human being. This is reflected in the kinds of consideration she shows for customers and their special needs and desires and too in the special training and consideration of the people she worked with.

 

Comments are closed.


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AUDIO TRANSCRIPT
TimePodcast Episode Highlights
0:37

Intro. [Recording date: February 22, 2022.]

Russ Roberts: Today is February 22, 2022, and my guest is entrepreneur and creative visionary, Maxine Clark. She's the founder and former CEO [Chief Executive Officer] of Build-A-Bear Workshop. I have a suspicion that some listeners have a bear from Build-A-Bear Workshop in their lives. Maybe it's your own, maybe it's one of your kids'--I'd love to see a selfie of you and your bear. Your kid's bear, if you want to send it along, I'd love to see it.

This year is the 25th anniversary of Build-A-Bear Workshop which started in 1997. And, I thought it'd be fun to find out how it came to be. Maxine, welcome to EconTalk.

Maxine Clark: Thank you. I'm glad to be here.

1:19

Russ Roberts: So, how did you come up with the idea? What was the original idea? And, better tell--I guess start with what is Build-A-Bear Workshop, for people who might not know.

Maxine Clark: Build-A-Bear Workshop is a retail entertainment experience where young people from three to 103 can come to our store and make their very own stuffed animal. While bears are our heritage, we haven't always--we've always had other animals, too: dogs, cats, ponies, kittens, cows--all kinds of animals have always been part of our assortment. But, the teddy bear is the quintessential stuffed animal. Everybody gets it when you talk about a teddy bear that you mean stuffed animals.

And so, we use that name Build-A-Bear Workshop, and it's been our success ever since. And, people often say, 'Well, why did you name it that? Why didn't you name it dogs, cats, blah, blah, blah?' I say, 'Because I didn't need to. Kids knew what I was talking about and that was who my customer was.'

I actually had been in the retail business for about 20-plus years when I started Build-A-Bear. Most recently as president of Payless ShoeSource, which is a volume-price shoe company in the United States that I had been involved in the acquisition of, for the May Company, and later became the president of. May Company was spinning it off as a public company and I was commuting from St. Louis to Topeka, Kansas, and I thought, 'Well, this is the perfect opportunity for me to take my money and run, and go and start my own business,' although I didn't know that day when I decided that, what it was going to be. But, I did know it was going to be for children because I thought that retailing had a lot of opportunity to engage children in their imagination; and we weren't doing it.

Like, we all talk about, 'Oh, I can't wait to go to Disney.' Or, 'I can't wait to go to Universal Park,' or wherever. But, actually, we could build more of those kinds of experiences locally. And, we have, in St. Louis, science centers and art museums and all these kinds of things. But, they weren't really in those days as focused on the experience, really touching and feeling and engaging with the product or the service that they were selling. Even in a entertainment place like the zoo--I mean, the trainers touch the animals but you're not supposed to.

So, we wanted to create an experience that--like myself, when I was a child, I always wanted to do things with my hands. I wanted to make something. And, I think kids do want to do that. It just depends on what you expose them to.

And, so, one day, I was out with my best friend, Katie, who was 10 years old at the time. We were looking--I picked her up after school with her brother--and we were looking for Beanie Babies, which was really popular at the time. And, when we couldn't find the one that Katie wanted, she just declared that: 'These are so easy. We could make these.'

Well, she meant go home and do a craft project in my basement, which we often did together. But, I heard something different. My brain went into this Willy Wonka mode and I saw exactly what I wanted to create in my head, this store at a mall where kids could come in and make their own stuffed animal and walk out with this gigantic smile on their face, hugging their stuffed animal.

And, a few minutes later, she came upstairs and she said, 'What are you doing?' And, I said, 'I'm looking on the computer to see if I--' And, this is--I was Netscaping. It was the old days. I was looking if there was a factory that made stuffed animals that I could buy, because I was already in the process of talking to several investors about investing in an idea that I might come up with someday. And, they all said, 'Why don't you buy a business and you can catapult it from that?'

So, I told her what I was doing and she said, 'I didn't mean that.' And, I said, 'Well, I know you didn't mean it, but you triggered an idea in my head that I think it could be really fun.'

And so, I went looking for a company. I found a couple. They didn't want to sell to me. They thought I was crazy. And so, when I came back and told Katie that nobody wanted to sell it to me and she said, 'Well why don't we do it?' And, I don't know what I would have done if she had said, 'Okay, bye.' So, we sat down and we thought of all the animals we could have and the names of the animals, and then she decided she didn't think we should name them because she wouldn't have wanted anybody to name her bear George--because that was her bear's name.

So, I would say that it was so much a part of what I liked when I was a child--going on field trips, and making things. And then it came together with the 20th century--we're still in the 20th century at that time--of a 10-year-old and what she thought we should have. Her little brother Jack participated also; and then I started bringing my other friend's kids and my neighbor's kids and I had my first Board of Directors, which was children. And I think that's one of the reasons why we were so successful, is because it wasn't just my idea. I came up with a canvas, and then I let kids and other kid-like adults participate with me.

So, there are many ideas in Build-A-Bear--I can tell you if you want to know--that came not from me at all. But, that was the beauty of the concept, is that not only is it a place where you can make your own stuffed animal, but I allowed people to add to the idea and make it even stronger for the consumer.

6:05

Russ Roberts: So, when people hear, make your own stuffed animal or build your own bear, they might be thinking that you gave them a pattern and a needle. So, why don't you walk us through what a customer experiences as a builder of a bear?

Maxine Clark: Yeah. So, when you come in to Build-A-Bear Workshop, you walk into a Disney-like experience, very magical. The store's setting is more like a theme park than it is a retail store that you would traditionally shop in, and the store is divided into stations. So: Choose me, Stuff me, Stitch me, Fluff me, Dress me, Name me, Take me home. Those are all the stations that you go through. And, the first thing is--the most time-consuming--is picking the animal that you want to make and they're all on display. Somewhere between 35 and 50 animals are on display for a choice, and you pick the one that you want.

And you can add a sound. You can add a scent. A lot of kids love birthday cake, and there's a scent that's birthday cake. So, a lot of bears go home with a smell of birthday cake in them. It's one of our most popular ones.

You can add a sound that's a pre-recorded sound. So, if it was an animal from Frozen, the movie, it can have the song from Frozen; or you can write, say, your own song--you can sing into the device.

And, then you go to the Stuffing station and you put a heart in the bear, and you make a wish on that heart. And, then you stuff the bear, you press the pedal and you can stuff the bear as much or as little as you want.

And, then after that, you Fluff the bear up and make sure that it's got enough hugs in it. And, then they stitch it up for you. And now--it used to be that we used to really hand stitch every bear closed. But, in 1998, we bought a patent to sort of pre-stitch the animals and zip them up, which allowed us to have a much higher productivity.

And, then you go to the Dress me and you pick out the outfit that you want. And, then you take it to the Name me computer and you give it a name and you make--it ultimately prints out a birth certificate that's yours for life, that tells you the bear's name and the day that that bear was born. And then you take it up to the register and pay for it.

And so, this is all almost like an assembly line, but not a straight line. There's fun. There's lots of interaction with our sales associates, with other customers who look over and see your bear and say, 'Oh, that's so cute. Where did you get that outfit?' And, 'Let me find that.' Or, 'Are you going to add shoes? What color shoes do you like?' I hear people talking to each other that don't even know each other, which makes me so happy in our store. But, it was also a great experience for a grandparent and a grandchild because a lot of times, if they take a child somewhere like to the movies, they don't interact.

But at Build-A-Bear, there's an interaction. And, I think that that part is the part that engaged not only grandparents and parents, but certainly the children. They got to go and if grandma was there, they probably even spent more money. So, there was really a lot to come with somebody, an adult person with you.

Some people told me, 'Oh, people are going to drop off their kids at your store. They're going to be like a babysitting service.' Never happened. They don't do that. They really want to be there with their child. It's a family experience. Often, just even if it's one parent and one child, it's an experience.

And, our children--people love to come around their birthday. So, usually, a common visit is two weeks before or after a child's birthday. They might get a gift card and they come to Build-A-Bear. They can't wait. It burns a hole in their pocket. And, we love to see it. There's so many amazing stories.

I mean, I just got an email this morning from a young man that I made friends with when I visited in the United Kingdom. And, he wanted to tell me that I hadn't heard from him for a few days because he was sick, and that he didn't want me to worry. So, he wrote me a note that he was getting better, but he had been off his email for a few days. And, his mother actually wrote me, too, so that I wouldn't worry about him. And, I would have worried about him, because he's such a nice young man.

Those are the relationships that you build when stuffed animals that are cuddly and soft and cute are in the picture. People are not hateful. They're not--oh, some people make fun and joke about Build-A-Bear; and Build-A-Bear's a very popular concept. So, it's part of the popular culture now. But, most of the time, it's all in a very loving and caring manner.

10:13

Russ Roberts: So, a couple things. I know at least one, if not two of my kids have a bear, but I think my wife built it, not me. I have been in the stores. We're old friends. So, I was at the world premiere of the very first Build-A-Bear Workshop in St. Louis. And, if you're listening to this right now, you might be thinking, 'This is like an ad for a company.' I'm interested and what we're going to talk about is how this came to be such a success. I mean, if somebody listening wants to go out and check it out, that's, of course, fine. But, it's such a fascinating story.

One reason it's a fascinating story to me is that, while you were telling that, even though I've never taken one of my own kids there, I got a little lump in my throat when you're talking about the kid doing it. And it taps--obviously, it's a profit-making enterprise; it's not a charity--but it taps into something deeply human, first of all, related to children, second of all, related to comfort and security that we want as children and that a stuffed animal often provides. It could also be a blanket, or another item, but an animal, interestingly, is often that security item. Have you ever thought about why bears are cuddly? Bears in real life are not cuddly. They're scary. Why is a stuffed bear, a teddy bear, something that we associate with warmth and kindness and love? Do you find that--do you think about that?

Maxine Clark: It's a wonderful story, though. Actually, the naming of a 'teddy' bear came in 1904, I believe the year was--1902. Teddy Roosevelt was the President of the United States, and he was on one of his famous hunting trips. And, he saw a big bear and a little bear out in the woods, and he would not shoot it. And, there was a cartoon--one of the cartoon writers that traveled with him drew a cartoon of this and called it Teddy's Bear. So, it did bring out kindness. It did bring out empathy. It did bring out that he wasn't afraid that he had to kill the bear in order to rid it of--the bear eventually, apparently walked away.

And so, about a year or two later, the Ideal Toy Company in New York wrote him a letter and said, 'We would like to make a stuffed animal and call it a Teddy Bear. Do you have any objection?' He said, 'If you think it'll sell, go for it.' They didn't--know licensing agreement, no financial arrangement. And, they made this Teddy Bear.

At the same time in Europe, in Germany, Steiff was starting out their company, and they also made a bear. Not necessarily related to the same story; but children--you often see children in antique paintings of the early 19th century, 20th century, into the 19th century, of a child with a bear. And, it just became the quintessential, soft--and, they weren't that soft because they were made out of mohair, which was itchy. But, as materials became more available, and people started having more imagination, you saw pink bears and blue bears and softer bears and woolier bears.

But, they also originally had joints in them, so you could move them. It was like a doll. They treated it like a doll. And so, there were clothes made for them, or baby clothes or baptism clothes were put on bears--all kinds of things. It became a steady product category for over 100 years.

And we reinvented it. And, I don't think--I think one of the things that's special about what we did was, we didn't invent teddy bears. Howard Schultz didn't invent coffee. Ray Kroc didn't invent hamburgers. We just invented a way to take it into a new level. And we made it more human. And, you know, most every child names their teddy bear something. The funny thing was if we followed the trends of the names that kids put in the birth certificate--like, during the World Series, when Sammy Sosa and Mark McGwire were fighting it out for the home run kingdom, they named it Sammy, or Mark, or McGwire, or Mac. The kids just respond to what's going on in the social stratosphere and they make it into their bear.

And of course, we eventually added licensed products. We added sports uniforms. We added different characters from Disney. And all of those are very, very popular.

But, for me, the ones I wanted to be the best sellers were the ones that children had to name and had to use their imagination to come up with the outfits and all of the different renditions. I've seen frogs in wedding dresses with high top sneakers and hiking boots and all kinds of wonderful things that just make me smile.

So, we really made a big dent in the way people thought about a stuffed animal off a shelf. I don't think anybody buys them that way anymore.

15:06

Russ Roberts: When you first started, how long did a typical customer spend in the store from entry to exit? And, did you track that religiously? Did you think about that a lot? Because that's what I would think about, as you talked about productivity, delay time, limited number of people who can get through the experience. You want to be fast, but you want it to be special. So, it was straight off there.

Maxine Clark: Right. We had no concept of how popular this would be right away. I knew it would be popular because kids told me it would be, but I didn't know how popular. We had lines out the door every single day, Monday through Sunday. And, we couldn't really handle all the customers. But they were very patient waiting in line. We developed a ticket-number system because the biggest hang-up was, people--the first time coming in, it was all the first time visitors--they hadn't seen everything. They were just overwhelmed. And, then also, the sewing of the bear by hand was a big slowdown.

But, people waited because it was new, it was fresh, it was fun. And, people were talking to each other in line. And we gave little stickers away to kids, and we made it as pleasant as we possibly could.

In the very first store, we had a candy bar, that you could fill bags of candy and then sell it. We'd pay for it at the register. Well, most of those bags of candy didn't make it to the register, because they were eating it in line. And, that was perfectly fine. It was like a way to keep people happy. So, we didn't worry about that.

But, we realized during Christmas, when we had lines out the door--and this was before plastic gift cards--that you could just scan and sell. We had to make every one by hand in terms of me signing them and make for the amount.

We had to close the store and redo some of the space in it. So, we closed it in January for about four or five days. And we redid the cash wrap where you pay for it. And, we redid the Name me--we added more Name me computers, so that there wasn't such a backlog.

We didn't--we couldn't reinvent the sewing system yet, but we eventually did do that. And, we filed for a patent for it, but another person filed for a similar patent and they got it a week before we did. They were earlier. And so, we ended up buying the patent from them, in, I think, 1998 for--he said, 'I'll sell it to you for $750,000.' That was a lot of money. But, it was the cheapest $750,000 we ever spent because we've sold over 200 million stuffed animals. And we had the patent, so nobody else could use that technique for doing it fast. So, it's one of the reasons why we're able to keep competition to a minimum and do this really well.

17:35

Russ Roberts: Let's talk about competition, because I always to argue that competition is trickier than you might think. In St. Louis, there was no other Build-A-Bear Workshop, there was no Build-a-Seal workshop, no Build-a-Camel workshop. But, there were a lot of experiential things in St. Louis--having raised our kids there--that were special. That, some were expensive, some were free. So, they had the Zoo. You had this--you mentioned the Science Center. There's other really wonderful museums there for children that focus on children. So, in many ways, those are your competition.

To me, your product wasn't a stuffed animal. Your product was a 30-minute--or whatever time it was--a 30-minute experience with your child that you hoped would be magical or that would be special and then would carry on and create memories and enjoyment after the event. Did you think about those other competitors? Was that important?

Maxine Clark: Oh, yes. Absolutely. Absolutely. It was very important. And, we wanted to be actually surrounded by those competitions. So, we opened up a store at the St. Louis Science Center. We had a great store at the St. Louis Zoo--it was one of our most productive stores. We opened a store at the ballpark, where you could make your own Fredbird. We opened up at other ballparks, as well. So, we knew that--

Russ Roberts: Fredbird, being the mascot of the St. Louis Cardinals. Actually, some people wouldn't know that, Maxine, but carry on.

Maxine Clark: I'm sorry. Sorry, Fredbird was mascot. So, wherever there was a mascot that was well-known in the public arena, we built a ballpark there and--

Russ Roberts: A store. Yeah.

Maxine Clark: A store in the ballpark. And had all the uniforms and the outfits and the mascot; and they were hugely successful.

So, we wanted to be wherever the customer goes to have fun. And, we've achieved that. Now there's stores on--when life resumes to normal, we have Build-A-Bear Workshops on Carnival Cruise Lines. We have them at Great Wolf Lodge. We have them still in a ballpark. We have one inside of T-REX Cafe in Disney World. So, we've had them all around, and we are part of that entertainment culture.

It's a choice that parents make to spend the money at Build-A-Bear for something unique.

And, usually, as I said to you--a birthday is very special in a family. And so, children say, 'I want to go to Build-A-Bear for my birthday,' or have a birthday party at Build-A-Bear.

We were also the first place where inside of a store, you could actually have a birthday party. It wasn't--you didn't have to go to a Chuck E. Cheese just to have a birthday party or a restaurant: You could come to Build-A-Bear and we would do a birthday party for as many people as you wanted. And that was very popular. It is still very popular--but we've kept them at bay during COVID. But, they're going to start up again really soon.

So, we also have Girl Scout Bears; and we've had all different, you know, kinds of bears that come in, that appeal to a particular audience. And they go gangbusters. So, when you had a Chocolate Mint Bear for Girl Scout cookies and it smells like--you have the scent that you can put in the bear--it is, like, one unbelievable seller.

So, we don't bring them out every year. We bring out new bears every year but we've had those come and go in our assortment.

So, we're really playing to all the things that kids make choices about. We have soccer bears and basketball bears. We have dress-up bears, wedding bears, princess bears, football bears. We have all kinds of choices for kids. And so, whatever they're into, there's a bear that you can make that looks kind of like you.

20:57

Russ Roberts: So, you open that first store. There's lines out the door, you know you've got a good product. You might not be profitable because it takes so long, but you might have been profitable from the very beginning. But, you had one store in a nice mall in St. Louis and now you're in Carnival Cruise Lines and all over the place. How many stores are there worldwide, and is the current number the peak, or have you come down, gone up?

Maxine Clark: Yeah, it's about 400 stores and some of them are only open seasonally because of where they're located. But I would say that, that's probably about the level that really works best because you still want it to be special. There's thousands of malls. We don't want to be in thousands of malls, and we're not right for everybody.

And then we also have different formats. So, we have our regular store, which is about 2500 square feet, then we have smaller versions that are on the cruise ships and in some other tourist attractions. We have stores in Walmart, we have stores--there's many versions now of a Build-A-Bear experience inside of somebody else's store as well as our own.

But our own are doing great, and we're very proud of coming through COVID and really revamping a lot of systems and procedures to make it as accessible during that time as possible. And, I think customers really appreciated it.

Plus we have so much more assortment now. I mean, we have a lot of choices, more choices than we used to have. When we were new, I think we could get away with a much tighter SKU--Stock Keeping Units--and choices for people because I never figured out the algorithm of it. But, I bet that there's infinitesimal combinations that you can make. And so, it's never boring.

And, I think that the customers--the price point has raised a little bit over time, but not really. There's still an opening price point bear, and then there's more expensive, and you can dress it as much or as little as you want. We have a lot of fun things that are just a t-shirt that has a saying on it, and a pair of shorts or a skirt. There's so many cute things.

And fashion is also very important to bear makers. They want to have whatever the latest fashion is. So, we see trends come and go. We see that during hockey season, hockey bears are popular. In baseball, it's baseball bears. I don't know if we're going to have a baseball season this year in the United States but--and bears, they're neutral. They don't have any particular political opinion. They're not--they don't have a race. The bear is whatever you make it. You can dress it. You can make it whatever you want it to be. And, all over the world, wherever we have Build-A-Bear stores, you see the bear in its native costume, and it warms my heart to see that it can be interpreted in so many different places. And still more to come.

23:39

Russ Roberts: So, you were very successful before you did this. You were President of Payless ShoeSource, which is not a small organization. You could argue one of the--you could argue it's the 180-degree opposite of Build-A-Bear for a experiential thing. It's basically some shoes on a shelf. And it's not a trivial task; it's a really hard job. I'm sure you worked a lot of hours every week to keep that--

Maxine Clark: I loved it--

Russ Roberts: successful. And, you had worked for May Company before that which was a successful chain of department stores. But, here, this was your first leap, really, of an entrepreneurial--your own company. Were you afraid? Were you afraid of failing?

Maxine Clark: I don't think--I'm sure I had moments of this but actually, you cross over. When you decide to do this, to go into your own business--whether it's a consulting business or a retail business--you cross over into this, I think, adrenaline space in your brain and your body that says, 'I'm going.' And, you convince yourself you're not going to fail. I was convinced I wouldn't fail. I had never failed at anything, really--so it wasn't that I was always hugely successful, but I kept always moving forward.

And so, I knew that this was--I loved working for the May Company. I had a great experience. And Payless was part of the May Co. at that time. And, so, they prepared me for this; and I was ready to go do my own thing.

In the early days of being in retail, I had a lot more say in what I made and what I showed to the customer. And I was always successful at that. And I wanted to just do something more socially redeeming. So, obviously we sell a lot of bears and people give us good, hard-earned cash for that. But, I wanted it to be something that when they left, they were a better person. And, that they felt happy, that they--or even if they came in with something sad--we have many moments when somebody's dying and they want to make a bear for their child because their grandma's dying or something like that. We have many of those stories. But, our store people are amazing, and they make those moments heartfelt. Maybe there's tears, maybe there's laughter in a different event, but our store people are unbelievable.

And, you know, at first I thought I should hire teachers and I should hire nurses and all these people that would engage with children but--and I did, and some of them were successful. But actually, none of them knew how to manage a store. And we were so successful. Running a two-and-a-half million dollar business is a big business in the store, and 35 or 40 people scheduling them.

So, we figured that out and we had a good mix of people. The teachers didn't want to be the managers of the store. The teachers wanted to work part-time. And, some of our best ideas came from those teachers who taught kindergarten, or early childhood education that worked for us part-time, because teachers often do have two jobs in order to make ends meet. So, we were--what I did, and I think my bosses did for me: I just did it in a different way--I created a canvas that allowed everybody to participate, including our customers.

We had hundreds of emails every week. Fortunately, we were started during the email time period, so customers could write to us, 'Will you make this? Will you make that? When are you going to do this? When are you going to do that?' And, we took all that in. We were always thankful for every idea that a customer gave us, from saying you should make a wolf to making a fish. I mean, we had so many choices. And, then people having--our store people just ebbed and flowed because we didn't make a rulebook. Our rulebook was Yes, because I didn't believe that any one customer could put us out of business. So, if a customer asks you for something, you have my permission to say, 'Yes.' So, we never--we always were--we actually were profitable. From the very first few months we were open, the store generated a profit. Of course, we had to put it back into the corporate operations. But the store was very profitable.

Russ Roberts: What were some of the stranger requests, if you know of them, that customers made that people said, 'Yes' because they trusted that you would be okay with it?

Maxine Clark: Well, one of them was really early on. A customer had their--their dog passed away. And they had their dog cremated. And they brought the ashes in a polybag [polythene bag] into the store to put it into a dog that we had. And, the--I didn't know. They didn't call and ask permission: They just did it. And, then they called me and told me about it. And, I said, 'Oh, that's so sweet of you to do this', because that's exactly what my heart said, like, 'Thank you for doing that.' And, then the customer wrote a note about it. And--it was before Facebook, it was before that--but they wrote us a note. And we posted all those things to our stores. We let the stores know.

So, then it started to come--if somebody--we had a customer who brought in one of those pacifiers. They wanted to wean their baby off the pacifier. So, they asked if they could put the pacifier in the bear. So, they did, and they named the bear Paci. And so that child never lost their pacifier, because it was inside that bear. I wouldn't have thought of that.

But, those are, like, kind of requests that probably somebody would have told us that we should be careful of, because if that falls out of the bear, then there could be an accident, and you'll be liable. But, we didn't think about that. We went from the heart. And, the customers knew if we told them we thought that might be too heavy for the bear or something, they knew that.

We've also repaired bears. People came in--the dog ate the ear off the bear. We had--our store people were adept at fixing the bear as best they could. And, sometimes that was a badge of honor that a bear was repaired at Build-A-Bear in our bear-repair hospital.

But, we've had so many--there was none of them that seemed odd. I was so glad that our first few stores in St. Louis had a lot of those requests, so that when we opened up stores in other places, we could train our stores, like, to know those requests might come so they wouldn't be shocked.

We had stores--people wanted to bring in their little children with autism before the store opened, because they didn't want all the noise and excitement and asked us to turn off the music. We did that. There was no problem with that. Our store people were: Yes. They--Yes was our philosophy, and it still is today.

29:33

Russ Roberts: How did you inculcate that into your employees? I mean, it's easy to say it. And, one of my favorite stories is some hotel chain, the person at the--a person's checking out and the person with the bags forgets to put them in the car and so the customer heads off to the airport without their luggage because the bell person forgot to put it in the car. And, this person without asking, immediately hops in a cab and chases them and takes them all the way to the airport. And is commended for it. Doesn't get fired. Doesn't get reprimanded: 'How could you mess up like that?' There's a culture in that organization--I can't remember which one it is; doesn't matter--where the Yes, the idea that you're talking about is, like, 'Take care of the customer first.'

How do you get that? It's easy to say. But, does it involve hiring a certain kind of person who is open to believing that? Because you can say it all you want: If they don't believe you, they're not going to do it.

Maxine Clark: Yeah. No, definitely, we hired people that--I call them huggable. You know, when you go down the mall and you look at people who work in stores, oftentimes, they look like they can wear the clothes that are in the store. They're thin and tall and they fit the--they're young if it's the young brand. But we wanted people to love children. And, that was something that we interviewed about--that they would be comfortable being around children.

And, later, we developed an interviewing technique where we did group interviews. So, you would do an interview of three or four salespeople--potential salespeople--and they would make a bear. And you would watch their own expressions when they made a bear. And, you could kind of tell a lot about how they would get into it.

A lot of teachers that work part-time were definitely into it. They loved to deliver a great experience to children. So, we found them. And people wanted to work at Build-A-Bear. That was the other--they wanted to work in a happy place. They'd walk by the store; and our store is yellow, light color, very bright, where a lot of stores were dark; and they'd look in and you had to smile.

In fact, the reason I picked yellow as our paint color is it's the international color that goes along with a happy face. And so, it made sense to me to be yellow. I mean, yellow doesn't cost more than white paint, and blue paint doesn't cost more than white paint either. So, we could use color as a way to attract people in the door and make the store seem more open.

So, our store people just came with a flow. And we made--we loved to listen to them. When we did our trainings of 'way of the bear'--we called it the 'way of the bear'--we talked about my values, how I was raised, what I cared about, why I created Build-A-Bear. And, I've heard people--I've been all over the world. People come up to me and they tell me the story of Build-A-Bear because one of our sales associates in one store, in one city, knew my story and told the story, 'Oh, I've heard all about you.' I was at our opening in Denmark, at Tivoli Gardens in 2005, maybe it was, or 2006. And, a woman who's rolling her baby on the main street there, a beautiful street, and I go up to talk to her and I said, 'Oh, come on in.' And, she's got an American accent. And, I said, 'Oh, where are you from?' And, she said, 'I'm from Georgia. I know you from the University of Georgia, because you went to the University of Georgia.' I said, 'How does this happen?'

This is what makes Build-A-Bear so special, is it actually brings common stories together. So, whether you had grief in your family, or happiness, or you made the cheerleading squad, or you got accepted to college, we have a bear for that.

And, it's one way to celebrate that doesn't have--it's not specific to any gender, it's not specific to any age. In fact, a significant percentage of our customers now and growing is over 13-, 14-years old, because they were there when they were children and now there's things that are iconic for them. Pokemon, and My Little Pony, and all these things are still part of their culture. Little--Hello Kitty. I mean, these things last, and we help make them last. And, we love to see kids come in and have an affinity for something like that. And so, we can't have everybody's affinity, but we have a lot. And, because we have so much variety of clothes, we can almost make anything.

33:35

Russ Roberts: Let's go back to the training for a minute. How much--there's an interview process that you were talking about, but let's say you decide to hire someone because you feel they have the empathy, or the kindness, or the warmth--the hugability that you're looking for. How long was the training process to get them ready?

Maxine Clark: In the beginning, it was about a month. We would go and hire them way ahead of a store opening and we would train them. We would bring, send people to wherever they lived or they would come to St. Louis for all that time. In the beginning, we had to bring them to St. Louis, because we didn't have any stores in all those other locations.

And, it was about a month, at least two weeks, maybe longer. And, then we would have a big ceremony at the end, and you'd become a Bear: You know, it's a ritual. It's an American Indian ritual, a Native American ritual. The bear is very important in Native American culture, and it's very important in our culture, too.

And so, we made that ceremony. We made it fun, we made it interesting. I spent a lot of time with them. All of our executives spent a lot of time. We didn't have a big team, but we knew everybody by name. That was the good old days when you could know every single person by their first name.

And, then they'd go back to their field. And eventually, those stores became training grounds. They became the recruiters for other stores in their territory, or other stores in their region. And, they absolutely lived up to every expectation. And, there were a few--but we really didn't have much turnover. In retail, as you know, there's a ton of turnover. We do not have the average. We're way below the average turnover.

35:00

Russ Roberts: Let's talk about the management for a sec. So, one of the things that makes a place like McDonald's special--and they were obviously one of the earliest to do it--is, as somebody described it to me once--I read it, I think, in a book--the secret of McDonald's is that instead of trying to find a really great person who can make the best hamburger in the world, you find a process that makes a decent hamburger that even a non-great cook or manager can still run effectively.

And, that's the genius of it, right? There's an algorithm, a protocol, a set of processes that allows there to be thousands of McDonald's instead of having to each time find a great chef. And, of course, not the greatest hamburger in the world, but it's got a reliable quality.

Now, your process, at least in the early days, was probably pretty cookie-cutter, I assume--meaning those stations that strangely enough you still remember by heart even though you're not the CEO anymore--the Stuff me, Build me, Stitch me--

Maxine Clark: Right. Fluff me, Dress me, Name me, Take me home--

Russ Roberts: Yeah. You know those by heart. That was similar in every store. So, was there a turnkey kind of structure for the store that allowed you to easily find a good manager? Or did managers have to have a set of skills--obviously different from the people in the day-to-day operation of the interaction with the customer? But, in terms of picking a manager for a new store, what was the process and how did that work?

Maxine Clark: Well, we did a recruit from stores that were in the children's-wear business and that worked at Noodle Kidoodle or Zany Brainy, they were in existence at that time, barely. We would hiring a lot of people from there. But, those were already automatically people who loved working with kids and loved playing with kids and toys and things like that. So, they were perfect for us, and they were just happy to go out of business just around the time we were really getting going.

But, good people bring other good people with them. We recruit from our customers. We have a lot of young people working for us now that were our customers that couldn't wait till they could come to work for Build-A-Bear.

So, I would say that once you get it open and you have a certain profile--our people are huggable, they're happy, smiley people. It was mostly women. Then we started to see that the guys wanted to come because they saw young teenage girls working there. We used to hire kids, when they first opened, 16 years old, because I wanted to give kids a chance to earn money for college. And, it was fine. And, then we had to go to 18 because we have machines in our store and OSHA [Occupational Safety and Health Administration] said, 'Those are machines and you can't have children operating machines.'

Russ Roberts: Occupational Safety and Health Act/Administration.

Maxine Clark: Yeah. Anyway, we didn't have to fire any of the people that we had, but we couldn't hire any more. But, still our 18-, 19-, 20-year-old customers [employees?--Econlib Ed.] are all young, going to college, working in our store part-time, and they love it. And, when I go to speak on college campuses, people bring their bears to the class. They want to show me their bear came to college, so you know--

Russ Roberts: Just like our listeners are going to send those photos in response to this--

Maxine Clark: I hope so--

Russ Roberts: But, what about the managers, not the day-to-day employees, but the people in charge of the store? I mean, you're running all these stores in St. Louis. You probably knew them inside out. You know all the people inside out. But now you're opening stores in Denmark, and LA [Los Angeles], and on a cruise line. What was your process for finding good managers?

Maxine Clark: Well, again, we have a profile of good people: where they've worked, what kind of background they had, how much they--if they're a teacher, retired teacher, what their flexibility is. A lot of times it's a teacher who has two jobs or a nurse who even has two jobs. People that want to do something different and they love kids, and so they come to us.

But, we've gotten--we're all competing for a lot of talent at high prices these days, and still Build-A-Bear, I would say when all of the accounts are in about this Great Resignation, you'll find we had less people leave than any other company, because people really--it's hard to find a place to work where you really feel like you're making a difference. And, our store people--on the line, our essential workers--are making a smile every day.

And during COVID, when customers did come in after we could open up again, they ran into our store to hug our sales, and then they had to stop because they weren't allowed to hug. Wearing masks--we made cute little bear masks for kids. We made bear masks for bears. We wanted to make sure that everybody saw us as part of the solution, not the problem. And, I think one of the reasons that our business has been so excellent is we have an excellent team running the company. But, our people were so glad to see customers again, it's not like--the children gave them hope and energy. And so, we've been thriving during this whole time.

39:53

Russ Roberts: What I'm curious about is this question of turnkey versus maybe more creative. So, do you think that when you opened your 300th store, that the skillset of the managers required a set of unusual skills or was it relatively straightforward? Obviously, it takes certain enormous personal ability and people-skills. But, the store itself, did it take care of itself because you would put in place the six stations?

Maxine Clark: Yeah. It has a flow to it. We have a system for ordering products. We have a payroll system. We have all the accounting, closing the books every night. It's--those things are pretty rote, so that the sales associates can spend time with a customer.

But, like anything, we've had to cut back on staff during COVID when it was so empty--the stores were empty. But, our stores became distribution centers. Because if you ordered a bear in your home town and we had it in our store, it sent a note to the store; the store made the bear and delivered the bear locally, so you could get it today or tomorrow.

Russ Roberts: A takeout bear. A takeout bear.

Maxine Clark: A takeout, pick up, carry out, curbside. We were able to adjust to all of those things because we knew that our products were necessary--necessary during these crazy times. Not just--it was an essential product. And, whether it was a little bunny rabbit or a teddy bear, people, if they wanted it, they had to have it, and they wanted it as soon as possible. So, our store people--our systems people rose to the occasion. Our store people rose to the occasion. The leadership of the company today is very forward-thinking and really use technology to make the life for our store people as simple as possible.

So, when the store makes a bear and ships it out there for an online order, they also get credit for that sale. So, everybody's winning. It's not like, 'Oh, I got to make this bear, but the warehouse is going to get credit for it.' No. It goes to the store who made the bear. So, that was a very big incentive for people, too. Maybe one or two people were working in the store that day, that's all because there weren't enough customers coming to the mall. But, they had something to do and they were making a difference.

And, they gave a lot of input to us--how to do it, how to change it, how to fix it, how we set up the store so that there were only a few people in the store at a time. People are standing in line, six feet apart. All those things came from our store people and our operations team figuring it out together--because there was no blueprint for this. We had no plan. We had to do it just like everybody else. But, we were dealing with children and we had to really be sensitive to that.

42:31

Russ Roberts: What's the craziest or best suggestion you got from a customer that you ended up implementing, maybe, to your surprise? You got one?

Maxine Clark: I don't think so. But, one that I will tell you about that was one of the most unbelievable in our company was, very early on, the first few weeks the store was open at the Galleria, we hired a teacher; his name is Jeff Mark[?]. He was working part-time for us. And, he created the Heart Ceremony. I came into the store one day and he was taking a heart, and he was rubbing it on the elbow because the bear wanted to be left-handed. And, he was rubbing it on the brain to make the bear smart. The child was doing it, but he was directing the child.

And, then everybody--all the family wanted to put a heart in the bear, so they all had to do the same thing. And, he made that heart--not just a little fabric piece of one inch by one inch--he made it into something substantial. And, then we were able to--we actually trademarked and patented it, and so only place that you can put a heart in the bear is at Build-A-Bear Workshop. If anybody else is doing it, we find out, and I call my friendly lawyer and we work it out.

But, we created something so special that our customers would tell us if they saw somebody faking it somewhere else. They would call us. They would send me emails, because they wanted the real thing and they didn't think it was fair that people were trying to knock us off--which is, you know, American economy. But, we never really had any serious knockoff competitors. They didn't make it very far--because they didn't have the heart and soul that we had.

The heart was the real--the physical heart thing. But also, the people that worked for us were so special that they made such a difference in the product. Because, what we were selling was the experience. Yeah, the teddy bear or the bunny rabbit, but it was the experience of making your own. And, I believe we've raised a generation of makers. I don't think that most kids today want to buy a teddy bear--adults want to buy a teddy bear off-the-shelf--or because they've made one and they want to come to Build-A-Bear and make another one for grandma, or a sister, or boyfriend, or girlfriend, whatever, new baby.

44:25

Russ Roberts: Any regrets that you--things you learned in the process you realized, 'I shouldn't have done that'?

Maxine Clark: I think that--no, it's not about not shouldn't have done it, but maybe we did it a little early. Like, we went to international: we were only seven years old. It was really complicated to be international. Not so much--the teddy bear is pretty universal--but there are different customs, different real estate requirements, different laws. And we did it as a franchise--we let people do it. But, not everybody was as committed to the business as we were. Like, some of the franchise operators might have had multiple businesses.

Yeah. It was a learning process. But I don't think it was bad to do. It's just that we got in it pretty early and we thought--some companies still aren't into international franchising that are much older than Build-A-Bear.

But, there's never a good time for everything. You have to put the foot in the water and try it, and see how it goes, and adapt along the way. But, that was one that was probably a little before its time [inaudible 00:45:21] our maturity.

45:23

Russ Roberts: Did you have tough decisions to make in the early days when you were trying to figure out the whole thing? And, obviously, there was some of the fog of war when you start a business: there's surprises, there's things you didn't anticipate. How did you make those decisions? You're a very--you had a lot of experience in retail, for sure. But, you were doing something different. You weren't[?] doing a set of franchises and an experiential experience, kind of, retail. Did you struggle with decisions in the early days? And, how'd you face that?

Maxine Clark: I'm a very decisive person. And, I put every idea that I--

Russ Roberts: I'm so surprised, Maxine.

Maxine Clark: I put every idea--you were around when I was starting this--every idea that I had into the store, because I knew if I made it the best I could make it, it would be a successful. And, if it wasn't, it wouldn't be because I left out an idea that I said, 'Oh, I'll do that later maybe.' Some of my friends told me to do it that way, but I didn't. I didn't skimp on anything. And, people really did--I heard them walking around and saying, 'I think this is owned by Disney. I think this is owned by Warner Brothers.' It was so perfect that they thought somebody more talented and more experienced in this space had done it.

But, I really did--I have a vivid imagination, I have since I was a little child--I put everything that I loved about field trips, about--my dad was a salesman who used to give out something to every sales call, so ours was a sticker. We made these stickers, and kids love stickers, and they'd walk around the mall with their sticker. It was amazing.

We had our boxes that we created, the Cub Condo. I remember walking in them all and I counted like 25 before I even got to the store. I was so excited to see--it's a living, breathing, walking billboard. And, kids loved them. They didn't want to leave without the Condo, so they could go home and color it.

We did all that. And it was just so--I had the money to do it, I did it, and I wanted to make it right, and I wanted kids to be really excited. And, I wanted the mall owners to want us to come there, which that turned out to be--it was very important, that first store. And we were in a great location and we had great staff.

But, it's funny, I did some crazy things. One story is funny. I think you might know this story. But, the second or third week we were open, it was parents weekend at WashU [Washington University]. And so, many parents come to the mall to buy their kids--Washington University in St. Louis is a university, sorry. And, they were coming, and they were buying their kids stuff, and they were in line at Build-A-Bear. And, one of these guys was coming through and we're frantic at the register and I'm waiting on him and I said, 'Oh, you go to WashU. What do you do?' He says, 'I'm a computer science major.' I said, 'Do you have any time on your hands?' And, he said, 'Yeah.' And, I said, 'Would you like to come and be our IT [Information Technology] director?'

So, Jason August showed up on Monday at our office and he was our part-time IT director. And, he was fantastic. I mean, it was fantastic, because our systems were pretty simple and he helped us get on track. And, he helped us even recruit our ultimate IT director. And, we're still friends today. It was like--those were things I just made a decision. I just, 'I'm hiring him. I need help.' And, if he couldn't do--I figured if he went to Washington University, he was pretty smart. So, it worked out in our favor.

But, those are the kinds of things that, you try it; if it doesn't work, you fix it. I'm a pretty much, 'Let's put it in play and see how it goes.' And, then I had a lot of experience. I had over 20 years of experience of doing that in the relative space that I was in, on somebody else's money. So, it was now my money and I could either win or lose, and we fortunately won big time.

Russ Roberts: I've been struck by--as I get older and I talk to people who have had extensive careers in management, executive operations like you've had. And, I ask them how they make decisions. They often will say--I've heard many people say this recently--'Oh, I go with my gut.' And of course, that makes it sound like it's just a wild guess, maybe it'll turn out okay. But, I think when you've had experience in a field like this, that we're talking about, your gut gets really skilled.

I don't know what the process is. And, of course, it doesn't mean you don't make mistakes. And, maybe I only talk to successful people and the ones who went with their gut and failed, I don't hear from them. But, I do think there is the honing of intuition that takes place. Some of it's reading people. Like, you didn't just say, 'Oh, that person went to WashU.' You looked in Jason's eyes, and I'm sure you made an assessment there that is not quantitative: it was qualitative. But, you have gotten good at qualitative assessment through a lifetime of doing it--

Maxine Clark: He was there with his parents--

Russ Roberts: Can you talk about that? Am I right?--

Maxine Clark: Yes, you're right. And, I think he was there with his parents, and he was making a stuffed animal, and what kind--a college kid. And, they were so nice. And, we just had this great conversation in a really short time. And, I did make an assessment, but mostly, I just needed help and I figured, you know, he'll come and help me.

But, you do--I think about that. I've made some pretty good decisions in my day and I've made them--I have a good instinct about people, and I can tell if they're honest or not. For some reason, that's what I care about the most. And, are they coachable? Can I teach them or can they teach me?

My CFO [Chief Financial Officer], my accountant, I called him up and I said, 'Do you know anybody that could help me?' And, he had a client who, she was the controller[comptroller?] and she wanted more responsibility. So, he said, 'Do you know what, we'll split the hours with you. Why don't you--she'll come to you three days a week, and two days a week we'll share the cost.' That lasted about four days. Tina was with me every single day since, and she still works with me today.

Now, she was the perfect person. But, my accountant--who knew me personally, who had done our personal accounting--and our lawyers who had done our legal work personally, knew me as a human being. And so, they gave me the service that I needed and they filled in the blanks where I didn't have that expertise. Because I do know what I do know. And, I'm not--we had made some bad hires. We had a few people that we hired that didn't materialize to be the leader that we thought they could, but they didn't do any harm. It wasn't like they did any harm. They just didn't do enough good.

And I think that that was--the hardest thing I ever had to do was during the Recession when we had to cut back on people. And, some of those people had worked from us from the beginning, because it was in 2008, so they had been working, like, eight or nine years with us. And, I felt really bad about that.

But, what I learned from that is I should have done it sooner. Because, had I let them go sooner and explained it to them, they would have been able to get a job faster because I waited a little too long. But, I did help everybody get jobs and I really advocated for them. We put forth their service. And I'm still friends with all those people today. We're still in touch in this day.

And, this year is our 25th anniversary. We're going to have a big gala celebration in August--in October--and I'm inviting all of those people. We're going to bring everybody back, as many people as we can, to celebrate with us. Because we wouldn't be Build-A-Bear without every single one of them. Even the ones that left, even the ones that left on their own accord or left involuntarily, all of them made a contribution. And we had very few problems. We did a good job of recruiting good people to do good work.

52:36

Russ Roberts: So, you were CEO [Chief Executive Officer] until what year?

Maxine Clark: 2013. The end of 2013.

Russ Roberts: Okay.

Maxine Clark: Chief Executive Bear. Chief Executive Bear.

Russ Roberts: Excuse me, sorry. Sorry, Maxine.

In recent times, Build-A-Bear had a little PR [Public Relations] problem. They had a promotion that was a little too successful. Can you talk about that a little bit? Tell people what happened and--

Maxine Clark: Yeah. It was our Pay Your Age Day. It was a brilliant idea. It was created to launch a program that was to celebrate your birthday. So, this bear was going to be created, a new bear every year. And, if you're five years old, you paid $5 for their bear. If you were 10, you paid $10 for that bear. Never to exceed a certain amount. But, anyway--and, to launch it, they did this 'Pay Your Age Day,' so that any bear--any bear in the store--could be bought for your age. And, it was sent out to all of our loyalty program. We had a very vast loyalty program. And, as long as you had a loyalty member, you could come in. So, word spread through social media to people who weren't Build-A-Bear customers to sign up and get this bear and bring your two-year-old and get a bear for $2, something like that.

It was at July of 2018, or 2017. I can't remember. And, the mall is usually quiet in July, not busy.

The lines were around the mall. I mean, we have pictures of that, around the mall. We were surprised. The mall was surprised. They sold out of food, not just teddy bears that day.

But, people managed. We managed through it, and it was a memorable experience. We could never have anticipated that people would--we anticipated it would be successful, but we didn't anticipate how many more people were going to sign up for the bonus program and get their bear for three bucks.

Russ Roberts: It's a great example of the fact that we say in economics demand slopes downward, meaning the lower the price, the more people would like to buy. So, obviously, if you lower the price--and what's your basic entry bear?

Maxine Clark: About $12.

Russ Roberts: $12. What's a fancy one with lots of clothes and shoes and things?

Maxine Clark: [crosstalk 00:54:44] be $75.

Russ Roberts: Okay. So, you can get one for five. So, everybody wants--people feel like--

Maxine Clark: Only the bear, not the clothes. Only the bear.

Russ Roberts: Correct, but still pretty exciting.

Maxine Clark: [crosstalk 00:54:54]. Yeah, it was very exciting.

Russ Roberts: So, people got excited and there were people who didn't get in who waited all day, hours and hours, and kind of a PR nightmare. At least that's the way it's described on the web that these people got angry. They were all excited. They waited in line with their kid. Bad thing.

Maxine Clark: Yeah, we get it was--there were more good stories than bad stories. We gave everybody a rain check, a coupon to come back and be able to do that within a certain amount of time. I think it was three or four weeks. They could come back anytime and get a discount on the bear. And, it actually re-energized the customer around Build-A-Bear. I mean, it was mostly good publicity. There's some newspapers, especially in the UK that take a twist and turn a bad something into a little bit more of a--

Russ Roberts: Dark.

Maxine Clark: edgy story. But, for the most part, I was there at the mall. I was trying to help. Customers were saying, 'Thank you for doing this. I haven't been out with my child. This was really fun.' The people in the food courts, they sold out of food that day. We made a big day in that mall. There were angry customers. There definitely was, but there could be angry people for a million different things. We tried to appease them, you can't appease everyone. But, for the most part, one woman wrote a note and said, 'This was--my child and I had the best day. And, we really--I got to explain to him about waiting, and about patience, and about--that we were doing this together, and it was really fun.'

And, she went into this whole spiel with me. And, I thought there's people like that see the opportunity in everything. And, there's other people that just get mad, but we had no idea. We didn't do it on purpose. We didn't--we wanted it to be successful, but we didn't expect that the lines would be around the mall, outside the car traffic jams and things like that.

Russ Roberts: The phrase around the mall sounds like just meaning there were a lot of people in line. I've seen the pictures, you can go online and just Google it, you'll see them. Some people were critical of you. Not of you, but of the company. You were no longer the CEO. But, of the company. Because, in England, it had happened. And, of course, England had opened ahead of the United States and they didn't alert the United States' malls that this was going to be a potential nightmare and so on. Did you know anything about it? Did you have any [?]--?

Maxine Clark: It was the same day. I mean, it was just a seven-hour difference. So, there were already customers in line--you know, 5:00 AM in the morning. You couldn't take it offline. You couldn't tell people this isn't happening when you had told them it was happening. It was just the time difference, day before.

But, we did learn some things, and we did put up signs, and we did get as quickly as we could to help get more people to come in to manage the lines all around the mall, not necessarily right in front of our store. And, they did a great job. I think the team did--I was so proud of them. I was proud of the customers. I was proud of--it was a big deal in the middle of July that nobody could have anticipated.

And, it did put Build-A-Bear back in the mainstream of people's thought, in a time when maybe they weren't really thinking about Build-A-Bear, which has certainly paid us over many times.

And, that program, the Pay Your Age program for your birthday--which is, every year, there's a certain bear you can come in and buy, is very successful. And, not--crowds aren't waiting, because everybody's birthday is a different day. You don't have to come in on your day of your birthday. You just come in the month of your birthday. And, it is a very successful program that keeps children smiling.

Russ Roberts: Do you know--are there any record holders for people who've made the most animals?

Maxine Clark: Oh, I'm sure there are those. I have seen pictures of--

Russ Roberts: What would be a big number?

Maxine Clark: Probably, a big number would be 300, 400, something like that.

Russ Roberts: Somebody who has 300?

Maxine Clark: Oh, yeah.

Russ Roberts: Oh, my gosh.

Maxine Clark: And, it's a big business on eBay. It's a big business on--even I buy some things that I wanted that we don't make anymore, I bought them on eBay. Myself, I bought a University of Georgia football outfit because the Bulldogs won the National Championship. And we don't sell Georgia football outfit anymore--so I bought that online. I was so excited. And, it was--you know, sort of historic packaging, which I loved getting it that way. So, the fact that people are making a business also out of Build-A-Bear, which is a part of the popular culture story behind us.

So, I think we've--all in all, we've had our ups and downs. Business hasn't always been perfect. And some years are growing and some years are not, but we've always managed to be right for that adaptation and keep growing and finding new ways to add joy to people's lives.

59:29

Russ Roberts: Do you have a favorite story about being in that business for 16 years, at the top of it, that you haven't told?

Maxine Clark: The different ones come to me on different days. But, today one of the stories that is reminds me of it, we were opening up a store in Washington, D.C. area in Virginia at--I forget the name of the mall. Anyway, it was--

Russ Roberts: Tysons?

Maxine Clark: No, not Tysons. Tysons was already opened. It was near Tysons. Anyway, and I'm walking up to the store and a father and mother and a little girl are there. And, the mother comes up and she's like, 'I hate to interrupt you because I know you have duties to do for the store opening, but I wanted you to meet our daughter.' She said, 'She was in your pediatric intensive care unit at Children's Hospital in St. Louis that you and your husband had named Build-A-Bear.' And so, what we have is a place there where you can get a bear and put a heart in it. And, this is where they do heart transplants for children in the PICU [Pediatric Intensive Care Unit] at Children's Hospital. And, she said, 'I just wanted you to see how grown up she is and how healthy she is. And, I thought you would--she wanted to meet you.' And, that was something that meant so much to me because that was something that my husband and I were able to do with the success of Build-A-Bear, with the money that we were able to make from being the owners of Build-A-Bear. We were able to give back to the community into something that I could never be able to do. I'm not a doctor.

But all those wonderful doctors serve hundreds of children, thousands a year in very dire situation, maybe life and death. And, the fact that they can get a bear right there, they don't have to go anywhere. They can make that bear--a brother, or a sister, or a parent can make the bear; and they can participate--just really, for me, was what it's all about. 'Hug' is understood in any language and that's what teddy bears do, and that's what we were able to do beyond the store.

My husband and I have been incredibly charitable to our community of the things that we think will make for a much more Mr. Rogers' Neighborhood. Teddy bears would want that. We're trying to bridge a lot of gaps through the love of a teddy bear and the resources that that business allowed us. So, it's all going back. It's all being put back into the customers who made us successful.

And, when I first started Build-A-Bear and I would go to some schools in more under-resourced communities, I'd ask if they had a teddy bear. I was always bringing one so they didn't say, 'No, we don't have one.' So, every child--if I came to their classroom, they left with a teddy bear.

Now when I go, they bring their bears to show me their bear in the new outfit. Or one little girl was--I went to a school before COVID, she had sewed a whole wardrobe. She wanted to be a designer for Build-A-Bear, and she had brought a whole wardrobe that she had designed and made of herself and she was in seventh grade, for her bear. I was, like, blown away.

This is what you can't put a price on. This is the part that is why you go into business to do something that you love, that means as much to you as it might mean to your customers. And, then it gives back to you a million times over. You cannot even--I can't tell you that--you ask me tomorrow, I'll have a different story that will pop to mind because I'm the bear lady. People see me in the airport and they go, 'Are you the bear lady?' I know what they mean, but I don't think of myself as a bear. I'm four foot 10, I'm a little bear, a little cub. But, I love that they recognize me.

And, I love that they tell me stories. I never tire of those stories. And, I think, I wish every company, every business person could have that connection to their customer that I was able to create through Build-A-Bear because it fuels me every day and everything else that I do since Build-A-Bear. And what I do for Build-A-Bear as well.

Russ Roberts: My guest today has been the Chief Executive Bear, Maxine Clark. Maxine, thanks for being part of EconTalk.

Maxine Clark: Oh, it's my pleasure. Thank you.


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