By Hope Belli Tinney, Washington Small Business Development Center
BURIEN, Wash. — Danny House, owner of Dan the Sausageman gift basket company, is the Small Business Administration’s 2018 Washington State Small Business Person of the Year.
In announcing the award, the SBA lauded House for his entrepreneurial vision and drive that enabled him to transform his one-person, door-to-door sales company into a national retail business through online sales.
“Dan is an amazing example of why every business owner should at least explore the option of online retail,” said SBA Seattle District Director Kerrie Hurd.
6,000 percent growth
In 2017, online sales propelled House to a 6,000 percent increase in revenue and enabled him to employ nine people at peak demand. While Dan the Sausageman gift baskets sales typically increase for Christmas and Father’s Day gifts, online sales have been strong year-round, enabling House to hire full-time, permanent employees as well as part-time and seasonal employees.
His online success also enabled him to purchase an under-utilized building in Old Burien that he plans to renovate and use as a distribution center and small retail shop, adding to the vibrancy of the commercial district. House was able to secure a $750,000 SBA 504 loan to buy the building with the help of the Washington Small Business Development Center (SBDC).
From one man to online
House was nominated for the SBA award by his SBDC business advisors, Rich Shockley and Jennifer Dye.
“The fact that Danny was able to scale up his business so dramatically after being essentially a one-person operation for so many years is truly remarkable,” said Dye. “It’s a testament to his organizational skills and ability to prioritize, but also to the relationships he’s built over the years with his vendors, suppliers and longtime customers.
“Like many small business owners, Danny has long been a tremendous asset to his community through ongoing civic engagement and charitable contributions, and it’s exciting to see him take this next step in his business development.”
The Washington SBDC is a network of more than two dozen business advisors and two export advisors who work with small business owners who want to start, grow or transition a business. The Washington SBDC is hosted by Washington State University and is funded by the U.S. Small Business Administration (SBA) and one-to-one match from state and local sources. The Washington SBDC office in Des Moines is hosted by Highline College and receives support from the Soundside Alliance and surrounding communities.
House first started selling jerky and sausage door-to-door in his early 20s, after returning to Washington from Germany where he had played semi-professional soccer until an injury ended his fledgling career.
House thought the door-to-door gig would last a couple months, tops. Instead, he said, his route around the South Puget Sound in a battered Dodge Dart was not only profitable, it was fun.
“The route was so great,” he said. He was calling on 20 to 30 businesses every day, from beauty shops to doctor’s offices. “Hi, I’m Dan the sausage man,” he’d say as he opened his case to offer a free sample or two. The relationships that developed were incredible, he said. “I loved it.”
Over the years, they’d talk about their lives — kids, cars, vacations — and their businesses as well. “I learned so much,” House said.
Dan the Sausageman also became a regular feature at community events and fundraisers in and around Burien. House has donated thousands of dollars in cash and products to support local schools and other nonprofits. Each year he gives scholarships to two high school graduates who plan to attend trade schools.
At first, House stored inventory in his garage, and then in rented space, but in 2004 he worked out a deal with the owner to buy the old Hi-Line Tin Shop at 923 SW 152nd St. in Old Burien, about two blocks from Burien Lake. He created a small retail space and storage area in part of the building, and used the rest, about 1,800 square feet, to create the Tin Room Bar, in homage to the oldest ongoing business in Burien, the Hi-Line Tin Shop, which opened in 1930. When the Tin Room and the sausage company outgrew their space, House took the sausage company off-site, expanded the restaurant and added a movie theater in 2010. All of that, he said, he did with handshakes, credit cards and help from friends.
An entrepreneur accustomed to being resourceful and making things work, House said he has avoided working with banks as much as possible. “To be honest with you, I don’t like banks,” House said, and laughed. “Banks have not been kind to me.” The problem, he said, is that they don’t take the time to understand his business or its growth potential.
Skeptical of banks and SBDC
House had to get over this feelings about banks when an under-utilized property on the same block as the Tin Room came up for sale in 2017. House said he loved the idea of renovating another property in Old Burien and he thought the property at 901 thru 907 SW 152nd St. would be perfect for his expanding gift basket business.
House contacted a loan officer at Bank of America who suggested applying for an SBA 504 loan. Elizabeth Stevens, a senior loan officer with the Northwest Business Development Association which administers the 504 program, referred him to the Washington Small Business Development Center (SBDC) for assistance with his loan application.
House started working with Shockley and Dye in October 2017. At first, he said, he was a little skeptical, but after his first telephone conversation he was won over.
They got it, immediately
“I’ve been in business for 30 years, and as I talked with Rich over the phone he immediately understood me and my business,” House said. “He got who I was and who I wanted to be — the potential for my business.”
Together, House, Dye and Shockley created spreadsheets breaking down his company’s revenue and expenses over the past six years, and other spreadsheets projecting growth four years into the future. “Between Elizabeth, Rich and Jennifer, I felt I was not going it alone,” House said. “I had three people fighting for me.”
When the loan officer requested additional information, House said, “Jennifer and Rich just kept coming up with answers.” Since they understood what the bank was asking for, House said, they were able to help him dig through his financial statements and respond to requests efficiently and effectively.
“All of them were in my corner, finding a way to make this happen,” House said.
In the end, House qualified for a $750,000 SBA guaranteed loan with 10 percent down and was able to complete the purchase by late November. Renovation on the building will begin in February, House said. He hopes to open in late Spring to sell Dan the Sausageman gift boxes and summer sausages. The site will also be a distribution center for his online sales.
Even though the sale is complete, House expects his relationship with Dye and Shockley at the Washington SBDC will continue as he works to grow his business.
“They are everything that you would want when trying to grow, need advice or are applying for a loan” he said.
House has been invited to ceremonies in Washington, D.C., on April 29-30 along with the other state SBA Small Business Person of the Year award winners. He will be honored at the SBA Gala in Seattle on May 3.