Olympic Hot Tub: One little dip was all it took
thenewstribune.com
August 25, 2008
By C.R. Roberts,
Q&A: ALICE CUNNINGHAM
Alice Cunningham grew up not far from the city where she earned her bachelor’s degree in sociology – at San Francisco State. Entering the job market, presenting herself at the school’s placement office, she was asked a question commonly heard by women in the 1960s: “Can you type?”
She didn’t want a secretarial position, and instead took a Civil Service examination. Her scores were such that she was placed on a career management track at the U.S. Department of Labor, where she eventually gained purview over employment programs from Nevada to Samoa.
Those were the days, she said last week, “when people felt there were solutions.”
While attending a meeting of the World Future Society – and with a weak marriage behind her – Cunningham met University of Washington engineering professor Blair Osborn. It was “July 2, 1975, at 2:30 p.m.,” she said. “We talked until midnight. We just clicked. We’ve never been apart.” Soon after they met, the pair took their first dip in a hot tub.
Cunningham left her government job in 1977, Osborn left teaching and they opened their first hot-tub store in Seattle.
Today, their Olympic Hot Tub Co. counts five locations in Western Washington – including one in Fife. At 67, Cunningham remains an active participant in the company’s management and recently began her own hot-tub blog.
That first hot tub experience – was it memorable?
A real wood hot tub in Santa Cruz, 1975, just after I met Blair. It was a cutting-edge thing. We thought, “This is pretty swell.” We didn’t think of it as a business. We were looking at old hot springs to buy.
But it caught your imagination.
It was very new. Later, we said, “This is going to catch on. Everyone has to have one of these.”
So you decided to go into business.
He was tired of his bureaucracy. I was tired of mine. My dad cried when I told him. He said I was making a huge mistake. I was on the fast track for moving up the ladder.
I asked myself, “How hard could this be?” It was a dumb thing to say. Nobody in my family or (Blair’s) had ever owned a business. We went from that government desk – the in-box, the out-box and somebody else does the lights and the vacuuming – to doing our own shipping, marketing and sales.
Neither of you had experience, and the product was unproved.
Hot tubs just felt so good. We thought this was the coming thing. We were the first in the Seattle area. We couldn’t lose – but we didn’t put it in those terms.
No hardships? You were a success from the start?
The biggest surprise, our first banker, she was an old Norwegian lady. She asked, “Do you like beans?” I asked what she meant. “You’re going to be eating a lot of them.” Imagine starting a business – you don’t know what you’re doing, nobody understands the product, how do you get your name out there?
What was your initial capital?
I sold my house in Berkeley. I sold my rugs. I collected rugs. I sold my antiques. Things were tight. We started with $30,000. I absolutely believed in the product, and I knew that everybody would want one of these in their backyard.
People would walk by (our first store) and look in the window. “What is that? Is it to make wine?” But we did well at the 1978 Home Show at the Kingdome.
Your product went from cedar to plastic, sales increased, and in 1989 you expanded into Everett and Fife. Then came Issaquah, and in 2006, Lacey.
That was a huge change. Opening new stores just seemed natural. We found people would drive about 30 miles. We were pretty sophisticated about location, being central. In Fife, we could get Tacoma, Puyallup and Federal Way. We wanted to be on I-5.
Any secrets to your success?
You absolutely have to get people to work for you who are better than you at every aspect. You just manage the direction. You manage for consistent performance.
Are you planing to expand the business?
In 2008 we added saunas. We sent a team to the trade shows – we gave them pedometers and they walked five miles a day. Their mission was to find new products. Saunas. And water care – we carry Silk Balance. We sell it online. We have the exclusive in the Northwest.
You started your Web site back in 1996, before everybody had one, and three years ago you started doing you own radio commercials, and now you’ve got a blog.
I began it in July. It’s basically putting a face on the company. Our whole strategy is to make friends, let people know who we are. It’s us. We live here, so you can talk to us.
And you’ve come to know your customers.
Three years ago we had an epiphany. You sell to someone who’s 50-plus, they’re probably only going to buy one. We started to advertise on younger radio stations – we wanted to get to the 30-to-50 group. The result has been really good. We’re also seeing a lot of children of parents who had one, and they want one.
What’s next?
We’re expanding our e-store. Water care products. After-market. Last year we added a valet service – to drain, refill and balance the water.
Any advice for entrepreneurs?
You’ve got to love whatever it is. Study the market. Have enough capital. If it doesn’t work, move on.
To stay in business, when you think you’ve got it all set, that’s when you should start reinventing yourself. Things really do change, and we’re always looking for ways to involve our customers in the experience.
Finally, which is it: “hot tub” or “spa”?
The industry calls it a spa. We call it a hot tub.
C.R. Roberts: 253-597-8535
blogs.thenewstribune.com/business
Alice Cunningham
Title: Co-owner and co-founder of Olympic Hot Tub Co.
Family: Husband Blair Osborn; two stepsons, five grandchildren
Locations: Five, plus a service center
Employees: 35
Annual sales: $10 million
Number of hot tubs sold over 31 years: About 17,000
Referrals: 45 percent of customers
Accomplishment: For 11 years, Olympic was the largest Watkins Manufacturing Co. dealer in the world. Now it’s second (to a dealer with 27 stores selling in England, Scotland and Wales), but remains first in the U.S.
Weirdest hot-tub-related story: One woman needed her hot-tub cover replaced because it had broken under the weight of a spaceship.
Greatest satisfaction: “People telling us that a hot tub has changed their lives.”
Read: Stories in the News
