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Good Vibrations Restructures Into a First-of-its-Kind Business Model
SAN FRANCISCO (March 29th, 2006): Good Vibrations, legendary destination for sex positive products, service and education, and multi-million dollar consumer cooperative today completed a legal restructuring into a new breed of a general business corporation, marking the first of its kind in the history of California corporate business. The new organization changes the capital structure of Good Vibrations while embedding the original values that have driven the historical success of the company and positions Good Vibrations for rapid national expansion.
"What makes the conversion unique by any standards is that we have ensured through institutionalizing our value statement and code of conduct into our new bylaws, that a future board of directors cannot change the fundamental progressive values of the company - only the shareowners can do this, if they choose," says Theresa Sparks, Chief Financial Officer and acting General Manager. "The decision to restructure will give us the opportunity to take our vision to more people, have access to growth capital and respond to the market more quickly," Sparks summarizes.
No stranger to pioneering unique business practices, Good Vibrations is the original women-owned and operated '"clean well-lighted place" to buy sex toys, books and videos. In 1992, founder Joani Blank sold the company to fifteen workers converting it from a sole proprietorship to a worker-owned cooperative. Business thrived as a faithful clientele and word of mouth referrals built sales and name recognition. For the next seven years, Good Vibrations' profitability grew by double-digits. Using company capital, Good Vibrations expanded into several business enterprises including retail, publishing, video/audio production and wholesale. Every new Good Vibrations retail venture was profitable within 30 days, including its e-commerce website www.goodvibes.com.
"For almost fifteen years Good Vibrations has used its owners cash to grow and compete in the marketplace. As industry competition increases, so does the requirement to have access to outside capital to fund that growth. The fact that they have been self-funding for so long is testimony to their business strengths," states Mike Sullivan, of Howard Rice Nemerovski Canady Falk & Rabkin. "The change in legal status to a general business corporation should improve Good Vibrations' access to outside investors."
In 2003, Good Vibrations began assembling a professional management team experienced in expanding retail companies with over 65 years of accumulative experience. Since that time, the management team has opened two new stores and launched a wholesale division. By concentrating on efficiencies, they closed down all unprofitable enterprises and focused on their core competencies, that being retail.
In 2005, Theresa Sparks, Chief Financial Officer stepped up as acting General Manager, to rebuild a new board and to capitalize on the strengths of the management team. New sales and marketing strategies were instituted to appeal to mainstream demographics including store remodels and branding. Customer service and education, the cornerstone of the company's business philosophy, was restructured to encompass a wider national audience.
In February of 2006, Good Vibrations opened its first east Coast store in the greater Boston area, which was profitable within the first month of operation. "The restructure will allow the company to move as fast as the public-at-large is moving in a growing comfort of owning sex toys," concludes Sparks.
Good Vibrations' Company Milestones
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