In this Nasdaq Amplify exclusive, we talk to WD-40 CEO Garry O. Ridge about the company’s 45-year listing anniversary, their San Diego pride, and the importance of creating a unique corporate culture.
Congratulations on your 45 year anniversary on Nasdaq. We started trading stocks in February 1971 so WDFC listed when Nasdaq was not quite two years old. What was the WD-40 Company of 1973 and what are you like in 2018?
G’ Day and thanks. We’re very happy about our longstanding partnership with Nasdaq. In the early 1970’s we generated about $10 million in annual revenue and our staff totaled 23 tribe members, all whom were headquartered in our San Diego offices. At the time, 90 percent of our revenue was generated domestically and we had just begun to distribute products through large retailers like Sears, K-Mart, and Woolco. In fact, Sears became the first account to sell WD-40 Multi-Use Product in two different departments - hardware and sporting goods.
In comparison, in fiscal year 2017 we generated $381 million in annual revenue, approximately 60 percent of which was generated in countries other than the United States. Our 448 tribe members live and work in 14 countries, speak more than 7 languages and are located in 6 different time zones. The blue and yellow can with the little red top has been leaving end-users in 176 countries and territories with positive lasting memories for more than 64 years.
I feel like we should already know, but for those of us who don’t, what’s the origin of WD-40 and how did it get its name?
The formula we understand is a closely guarded secret – where is WD-40 Multi-Use Product actually made? Are you making everything in San Diego?
Similar to Coca-Cola, Kentucky Fried Chicken and Google, the formula for WD-40 Multi-Use Product is a trade secret so protected that there was never a patent filed for it. We actually manufacture very little ourselves. We manufacture the secret formula for WD-40 Multi-Use Product ourselves in only about four global locations. We then ship that “secret sauce” to contract manufacturers, who are located around the world, who blend, package and ship our products to our customers for us. It’s a very capital light strategy.
What do people generally speaking not know about WD-40 Company?
Most people know the blue and yellow can with the little red top but very few people understand what the story behind the can is and why the brand is so successful. Our success has a little to do with the “secret sauce” that makes up the formula for WD-40 Multi-Use Product but a lot to do with the fact that we are comprised of a tribe of purpose-driven, passionate people who are guided by our Company’s values.
What other products are in your portfolio?
In addition to WD-40 Multi-Use Product we sell a line of best-in-class specialty products which are geared toward trade professionals called WD-40 Specialist. We also sell comprehensive lines of bike and motorcycle products developed for two-wheel enthusiasts and mechanics. We also own some other well-known brands like 3-IN-ONE, Carpet Fresh, Spot Shot, 2000 Flushes, X-14 and Lava Soap.
Talk a little bit about home base. Including WD-40 Company, Nasdaq has over 70 listed companies between San Diego and North San Diego County. It’s very special to us. Has San Diego always been WD-40 Headquarters? What’s it like to headquarter one the world’s greatest brands in one of the world’s best cities?
Yes, as I mentioned earlier, it all began in 1953 in a small lab in San Diego. However, I don’t think of San Diego as our headquarters – we’re a global company that just happens to hang its hat in America’s Finest City. And why shouldn’t we? San Diego is in a unique position in the global market. It is not only a great place to live but is also a place with ample career opportunity. It’s also a convenient place to run a global business from. I can catch direct flights to London, Frankfurt and Tokyo so I can get nearly anywhere I need to go rather efficiently.
Company culture is one of the great attributes of your business and you’re referred to as the “Tribe”. When did the WD-40 tribe start and why do you feel company culture is so important?
When I became CEO of WD-40 Company back in 1997, I had a desire to shift the mind-set of our employees and rebuild our corporate culture. We began identifying ourselves a tribe because as individuals, and as an organization, we aspire to live up to the wonderful principles of tribalism. The way I see it, a team is something you play on once in a while, a tribe is a place you belong.
For us, “tribalism” includes a sense of belonging, communication, having shared values, and continual learning between elder tribal leaders and younger tribe members. This learning culture is deeply embedded within our organization. Ultimately, tribalism means creating a unique culture, which we are proud to say is true at WD-40 Company.
The tribe even has a core set of values that you have front and center on your website. How did that come about?
My journey to shift the mind-set of our employees and rebuild our corporate culture began with clarification of our vision and values. A vision gives you a sense of direction, or purpose, and values give you a compass to keep you on course. At WD-40 Company we exist to create positive lasting memories in everything we do. We solve problems. We make things work smoothly. We create opportunities.
What are the big areas of growth for WD-40 Company in 2018 and beyond?
We are very long-term focused here. In fact, we have shared with our investors our revenues targets for 2025. Our long-term objectives are pretty aspirational, but they are built on a solid foundation. Our anticipated revenue target is to drive revenue to $700 million (from $381M today) by the end of 2025. We’ll achieve that target through geographic expansion, increased market penetration and development of new products.
Congratulations on the tremendous price appreciation that the equity has enjoyed over the past several years. How have your conversations with WD-40’s long term shareholders evolved since you took over as CEO?
Well, to begin with, we didn’t have a very active investor outreach program in the ‘90s. Establishing relationships with our investors to familiarize them with our Company was an early priority for me. Today we have several investors who have owned WDFC for over 10 years and we maintain active dialogues with many of the actively managed funds. I want investors to feel that they can ring me anytime and get candid answers on our Company’s performance.
You’ve written a book with Ken Blanchard, Helping People Win at Work, what are few business books you’ve read recently that you’re recommending to tribe members?
That’s a hard question. In fact we actually have a small library in our San Diego offices that houses some of our favorite books on leadership for tribe member use. Some of my favorites are: Leaders Eat Last by Simon Sinek; Braving the Wilderness by Brene Brown; Tribe by Sebastian Junger; Trigger by Marshall Goldsmith; and The One Minute Manager by Ken Blanchard.
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