irreplaceable relationship manager, The

Northwestern Financial Review, Oct 1-Oct 14, 2005 by Telschow, Tony

When Mike Tillman was downsized after 26 years with a paper company in northern Minnesota, he used every resource at his disposal to bounce back. Then an unexpected connection led him into business.

Mike had stopped into Minnesota-based DuluthSuperior Trophy and Awards to pick up trophies for his classic car club. The owner knew that Mike worked at the paper plant and asked whether he had been cut. Mike said yes, and the owner offered to teach him the trophy business, then sell it to him outright.

After working at the shop for a while, Mike and his wife Shirley started thinking about how to buy the business. Shirley had worked in a large bank, and she contacted an old acquaintance there for advice. When the banker heard that Mike's background included a bankruptcy, he pointed the Tillmans toward an economic development center in Duluth. Shirley worked on a business plan, the economic development center helped get the financials into shape and, in time, Mike and Shirley met a banker at a local community bank who helped them get the financing they needed to buy their business.

The big difference

Shirley Tillman said that her bank couldn't have been better about helping her and Mike through the start-up phase of business ownership. Their banker was curious, enthusiastic and very supportive.

"We set up a meeting. We took the figures in. We took the business plan in. We met with the banker and spent maybe a good couple of hours just going over ... our background, our goals," Shirley Tillman said. "What she did at that initial meeting was, got to know us before she even looked at the paperwork."

The banker also had a knack for taking things in stride, as she did when the former owner of Duluth-Superior Trophy changed his mind about the structure of the sale.

"We've got the purchase agreement signed, and as we're going to the bank that day, the [former] owner here said, 'well wait a minute, I've got to get some cash out of the deal.' He went on to change the whole structure of what we'd been doing for a year," Tillman said.

But the banker adjusted quickly and restructured the deal. Three days after it was submitted, the SBA approved it and the Tillmans were in business.

They landed $250,000 in financing, but it had cost them more than $25,000 to do it. "[Mike] had a lot of vehicles then, classic cars, and he was selling them left and right," Shirley Tillman said. "We got down to the day of the closing and...we ran out of money that day. So we're going into the business with nothing."

The Tillmans decided to secure a small short-term loan for cash flow. They later established a $25,000 line of credit.

Duluth-Superior Trophy was under new ownership, and the Tillmans had a trusted business partner at their bank.

"She had been with us for six months before we even walked in the door," Shirley Tillman said. "She knew our business. She took the time to care about it. That was the big difference."

When the banker is the bank

This level of service is bound to reflect creditably on a bank. But what happens if the banker leaves?

The Tillmans had to answer that question because their lender left the bank.

"The president of the bank came in to us immediately and told us about it, and said...they didn't want to lose our business," Tillman said. "The president...has been very, very nice to us... bent over backwards, I would say, to do everything possible for Duluth Trophy."

But the rapport isn't the same. Shirley Tillman said that she and Mike recently bid on a lucrative contract for the Minnesota State High School League. "We went to the bank and we told them about us going for the bid...I don't feel like they were supporting us in it," she said.

Duluth-Superior Trophy was the only Minnesota company to bid on the contract, and winning it would have been a boon for business and the business's statewide standing. "We had talked to [our original banker] when we bought the business about going after that, and she...had the enthusiasm like we did," Shirley Tillman said. "When I was putting the bid together, if [she] had been there I would have taken [the] numbers to her, where this time I didn't."

Tillman said that Duluth-Superior Trophy was undersold by a company outside the state.

"I don't want to say anything bad [about the bank], because...without them we wouldn't own the business; that's the bottom line. But, who got us the business? It was [the original banker]," Shirley Tillman said.

"When you lose a banker that you've had since day one, you've lost a partner. That doesn't mean anything negative on the bank. It just means you've lost a personal partner," she said.