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- [00:01]
Narrator
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- [00:54]
Mike Hoffman
Hi, I'm Mike Hoffman, Editor in chief of Inc. And you're listening to youo Next Move Audio Edition produced by and Capital One Business. In this season's Audio Edition, we're bringing you conversations from the youe Next Move Pop up studio at the Inc. 5000 conference this past October in Phoenix, Arizona. You'll hear Inc. Writers and editors interviewing the founders of some of the fastest growing private companies in the country. In this episode, Inc. Staff reporter Ali Donaldson speaks with J.D. hayes, co founder of Legacy Retail Solutions, which was number 8. 99 on the 2025 Inc. 5000 list. Now, Legacy Retail Solutions is a CPG advisory firm that's grown four hundred and seventy percent over the past three years. Ali starts by asking J.D. what he credits as the single biggest driver of growth and what he believes will matter most over the next couple of years.
- [01:46]
Ali Donaldson
Okay, J.D. we're going to start. You're going to introduce yourself, tell me what the company briefly about what the company does and your number.
- [01:53]
J.D. Hayes
Okay, fantastic. J.D. hayes, I'm the co founder of Legacy Retail Solutions, part of the Traverse Group of Families Legacy Retail. We're based in Bentonville, Arkansas. We largely work with CPG companies to help them get their products listed at the world's largest retailers. Being in Bentonville, Arkansas, there's one there called Walmart, but you may have heard of it. Yeah, you may have heard of it. We service a lot of the big box retailers though. We work with Home Depot, Costco, Target as well as Lowe's. And then of course Amazon is obviously a big player in the retail as well. So we work with clients to service them and getting their products listed in those retailers and on those shelves and we help them in their supply chain whether it's warehousing needs, omnichannel strategy, helping Them prepare their products to be listed online, demand planning, forecasting, all that sort of stuff. So really, sales leadership and then on the back end, operationalizing and making sure that the goods arrive on the shelf and the merchandise properly promoted and the buyers are happy and the merchants and the manufacturers are happy.
- [02:52]
Ali Donaldson
So, J.D. we're talking. You're here because you all have had massive growth over the past few years. What would you credit as the single biggest growth driver that has gotten you here? And when you look over the next 12 to 24 months, what's the biggest growth driver that you're going to be focusing on?
- [03:08]
J.D. Hayes
Okay, I also failed to mention our number. This is our third year on the list and we're number 899 this year. It's very ironic and blessed that we actually have been improving our number each year. Most people that make the list, it goes down. Yeah, it goes. The inverse right. Goes. You get a higher number. We've actually been acquiring a lower number and this being our best at 899. So we're really proud of that. I would say that really our success has been the brands that we work with and distribute. We've had a little bit of lightning in a thimble, so to speak. We work with some very iconic brands. Our focus is distributing those brands primarily in the club channel, so Costco and Sam's Club. And these are very iconic brands like Pokemon as an example. We're the distributor for them of their, of their trading card game. And it's been on fire. I believe next year is their 30th anniversary as well. So there's just a lot of hype around, around it. A lot of people don't know, but trading cards have actually been the number one asset performing class since 1974. People are now collecting them and putting them as part of their portfolio. It's quite amazing. But we've been building off that brand and other brands like Magic, that have properties as well, ventured into the sports trading card arena as well. So we're doing work with like Upper Deck, you know, some other guys in that field that we're probably not going to name right now. But yeah, work Panini being one. So it's been a fantastic ride. And so that's what's gotten us to this point. And we think there's something about the collectibles and so we're just looking forward. It's about all creating value for the shoppers and bringing even new and exciting things to retail. You know, retail is the, the pioneer of what's happening in the world. That's where the real money exchanges hands. And you've got to be fresh, you got to be new and you got to be priced right and you got to be on point. And so we're looking for what that next evolution is and what we call the collectibles world.
- [04:49]
Ali Donaldson
Is it going to be the Labubu?
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J.D. Hayes
Well, maybe. There's a lot of things out there. I'll just leave it at that. There's a lot of things out there. We have several things in the pipeline that we're very excited that you think
- [05:00]
Ali Donaldson
could be the next Liveubu, could be the next. So you're going to have to let us know when that happens.
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J.D. Hayes
I will.
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Ali Donaldson
And so you know, like you said JD that you have been lowering your number on the Inc. 5000, increasing that growth. That's so difficult because one of the hardest things about growth is sustaining it. How have you done that and what sort of trade offs have you had to make to sustain that growth?
- [05:22]
J.D. Hayes
Well, great team, great talent. You know there's a lot of people that contribute every day to this business and that's just first and foremost people say they're in the people business and I mean we really truly young people business. So our teammates are dedicated and they really put in the grind. There's you know, sometimes sacrifices made professionally, personally because they're so passionate about the brands that they're working on and where we're going. And I'll be honest, I mean it really feels like not work across the organization. And yeah I'm supposed to say that but I think if you even went down into the bottom of the teams you would find that people truly do enjoy what they're doing and they're so passionate about the brands that it doesn't even feel like work. And our biggest team has to be run out of the office on a Friday afternoon at 5:30. It's like guys go home. So I think just having that, that passion and that is very something that has been a little bit of a secret sauce for us.
- [06:11]
Ali Donaldson
Okay JD if tomorrow somehow 30% of your budget got cut, what's going, what's going to stay, how would you handle that?
- [06:20]
J.D. Hayes
Are you reading our emails? We actually, we actually facing that.
- [06:25]
Ali Donaldson
Okay, well talk me through it.
- [06:26]
J.D. Hayes
Well, we've had, we've had some allocations that we're dealing with and so it has been an issue where we definitely have to try to right size that and make sure that we're placing bets in the appropriate places and we've had to have some hard conversations both with our brands and our retail partners. But at the end of the day, being a distributor, you're kind of middleware and so you don't as much control your own destiny as you would really like if you're the manufacturer, which we are not in that regard. So we have to kind of deal with the cards we have and try to make the best of it. And I think the team's done a tremendous job doing that, but really just staying uber focused on the P and L and making sure that when we have to make these tough decisions that we're looking at margins and we're seeing where can we really afford to make these cuts and where can we not afford to make these cuts but.
- [07:11]
Ali Donaldson
And take me into some of those P and L. Are there certain places where you're like, okay, we can cut that software. We can do without this and other priorities that we really need to keep this.
- [07:20]
J.D. Hayes
So far we haven't had to make the hard decisions to make the cuts. We've been very blessed and very fortunate. We continue to grow and even with the cuts, we're still projected to grow, which is again very, very blessed and fortunate for that. But I do think that you have to constantly being evaluate. I mean, the tech stack is one that is ever evolving. I mean, you can spend a small fortune, you get mesmerized and whiz banged by all these, you know, things. And of course the demos are always amazing, right? And then comes integration. But yeah, tech is a big part of it. But I go back to one of the comments I made earlier. We still really are a people based business, a relationship based business. And, and it's that that we have with our brands.
- [08:02]
Ali Donaldson
And how did you handle having this conversation with your team? How do you approach bad news in general?
- [08:07]
J.D. Hayes
Well, fortunately, again, great people, we have a general manager, Jesse, that, that runs the retail distribution part of our business. And I've never encountered and worked with somebody that is so close and so dialed into their business and really knows where the bodies are buried. But I would take he has to go very positive approach. In fact, he just shared with me today, we were walking a local club here in Phoenix and he said, you know, I sat the team down last week and I said, hey, there's a lot of things going on in the economy right now. We even saw some notices today from one of our big customers, had a lot of layoffs. And Jesse just really imposed on the team that, hey, look, there's a lot of turmoil that might be out there. But, you know, we are in a good position. We work with great brands and we are, you know, we're maniacal about finances with our business. We really try to run it like a fortune one very smart about things and just giving people that peace of mind that there is stability here. And, you know, that really resonates with people and means a lot. I don't think people think that much about how important that is, but boy, it's important.
- [09:05]
Ali Donaldson
And so, Jamie, I cover retail. This business is constantly evolving. How is your business evolved in that space? Are you working with different brands? Do they want to look differently on the shelf in store? Is the distribution different in terms of where they want to be in the country? What's changed about the business?
- [09:21]
J.D. Hayes
Well, there's been several changes, none more so than the emergence of E commerce. Right. You know, the old days, you would sit down with a retailer and they'd say, you know, do you know where the closest store is? And the reality is the phone in your pocket now is, is the closest store to you. And we are an instant society. But E commerce is a big one. And that requires a different set of activity. You know, the content and you know, the imagery and you know, the keywords and all that sort of stuff. The online marketing in the old days of retail, you know, you would sell the goods and you would try to support the retailer that we're going to help drive the traffic to get the pull off of your shelf. And we do that with packaging, we do that, you know, with marketing, whether it's tv, print, whatever. But nowadays it's just completely different. And with the Omnichannel, you have to have a strategy around servicing anybody, no matter how they're shopping, whether it's in a physical store or on online mobile.
- [10:11]
Ali Donaldson
And you know, speaking of ecom, how are you thinking about AI with your business? Are you implementing it right now? Are you thinking about it? Where can that help you be more efficient?
- [10:19]
J.D. Hayes
Well, I try to use it personally a lot to be more efficient in just kind of my task and whatnot. But we are really trying to test the edges on it. And how have you done that? Like it's going to have an impact? Well, one thing we've done is we've blocked certain websites actually from our access points on our machines. We're trying to stay into just certain ones that are in part of our ecosystem. So we've decided that Copilot was going to be the one that's in the Microsoft. That's what we were going to use. That's really the only one that we've allowed. But there's no question that AI is going to have a big impact. I think it's going to have less of an impact on the relationship based part of what we do. Right in the actual sales of the transaction where I think it's going to become super efficient is on the backside on operational. So thinking about demand planning, like being able to foresee trends from POS and then you know, communicate that back upstream to manufacturer on hey, we need to peel back about, you know, 8% on this bill because we're having a softening. I think the AI will be able to help to do that. And that's one big area. I think testing is another area AI will generate on. And then I had one of just the analytics transportation, that'll be another one that I think that AI is going to play a big role in. So we use those levers in our business but we don't own those levers, so to speak. Those are other plugins that we have to do kind of integrated services.
- [11:38]
Ali Donaldson
And because like you said that your business is so relationship driven, it's so human. Is your team thinking about how to even be better at those relationships using AI, whether that's like I'm really going to research the hell out of this client before the meeting and I'm going to be, you know, 10 times better than I would have been before because it might, you know, have an insight I didn't think about.
- [11:57]
J.D. Hayes
Yeah, I'm kind of sitting here laughing a little bit because and this is no surprise probably to the listeners but the, the young interns. So we have a lot of interns that come through.
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Ali Donaldson
Tell us about the Gen Z interns.
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J.D. Hayes
Man, they are amazing. They're so smart. I mean, oh my gosh, like so much smarter than I was when I was that age. And what, how fast they think and how, how they're able to go get. They have adopted AI like, like crazy. And you could give them a project to go research a brand that we're maybe exploring with or we have meetings coming up with somebody and we want to really understand to your point about. And I mean they are just able to go out and put the most amazing top line executive presentations and recaps together with, with imagery and facts and quotes and data and it's just amazing. And boy, it's a way different pace but they're amazing.
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Ali Donaldson
There's hope for the future.
- [12:48]
J.D. Hayes
There's hope. Yeah. I will say a lot of the younger generations used to get a Bad rap. This current one that's coming up, they are wicked smart. I'm excited for them.
- [12:57]
Ali Donaldson
As you've grown this fast, how have you approached hiring and how do you approach not wanting to over hire too, but still wanting to make sure the team isn't stretch too thin?
- [13:08]
J.D. Hayes
That's hard to thread the needle. We probably ask too much at times of our team and probably stretch them too far. We're trying to get better at that, but it seems like no matter how fast we move in that, that the business just keeps because of again the brands that we play and the retailers that we focus on. That's the other thing is our retailers are the big ones that really move volume. And I also think, you know, the earlier point you made about some of the things that are happening. There's no question if you're in retail and even you're a consumer, you're hearing all the talk about tariffs and the impacts that that's having. A lot of the stuff that we do is domestic and so our retail partners have leaned in because we sell actually in the toy category. The trading cards are in the toy category. And if you think about historically where toys come from, they come from parts of the world that are not in a good spot right now from a tariff perspective. So in some regards, you know, it feels as though that we are being leverage to help offset some of that tariff exposure. And so that's been another big part. But we really focus on people that have a hustle about them. That's a big part for us. You got to really have that, that hustle. People that can really create value is another thing that we look for. Just people that can really communicate. Those are I'd say three of the big, big buckets. And we're very intentional about hiring. It's a long process with us. It's a couple phases to get through it. And we have people that we feel very blessed that people like really want to be there. And I mean they're advocating for themselves that they want to be there. And so we feel very blessed that we're attracting good talent.
- [14:40]
Mike Hoffman
When we come back, Ali asks JD what he looks for when building his team. But first, a quick break.
- [14:49]
Narrator
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- [15:51]
Ali Donaldson
And JD when you're making that balance between wanting to build out the team but not over hire, what kind of roles do you think are better fits for okay, there's this young up and coming smart young Gen Z or maybe they can grow into this role versus what are the roles that you think you do need to hire for?
- [16:05]
J.D. Hayes
Outside as we have hit scale, we have brought a lot of things back in house that maybe were outside in the past. Just having the speed that we need to be able to move. Getting caught up in having to go outside is really hard in terms of where that generation is being. It's really a lot of the research the, the that I would say has probably been the big thing that they've been done. They, they're just so quick to adapt to tools and services. We just rolled out, finally had a really nice successful ERP system roll out and we started with the financial and accounting module. We had a failed one two years ago led by myself and my co founder because we didn't think, you know, we're business people and we didn't think about things in the way that this younger and now we just came through it and the accounting team was way more robust with younger people and they didn't know our system that we were implementing but they just had the technical savviness. They just understand how things work. And so I would say around tech and platforms and research kind of that maybe the, the down and dirty like work that people overlook sometimes everybody wants to, you know, have that client interface or that customer interface and whatever and that's that's needed but you got to have the bullets in the gun. And that's what they are so good at doing is giving the bullets in the gun to be able to go execute.
- [17:25]
Ali Donaldson
And JD as the company, the team have grown, how have you maintained a sense of culture, that kind of hustle you talked about by still, but also still knowing that this needs to be professional.
- [17:36]
J.D. Hayes
We're very intentional about our culture and we're very intentional about who we hire and that that is the number one way to protect your culture. We don't try to force the culture. It's like having a nice yard. I mean, you got to let it sprout and you got to let it go. But every once in a while you get a weed and you got to, you know, spray the Roundup and kill that. But we have a certain profile that we look for, somebody that, again, creates value, has that hustle. There is. There is a. Actually did an article for Bench area at Inc. Magazine on this last year, preparing for the conference. When I came, I filled out the CEO survey and he called me and said, hey, there's a question you filled out here, that an answer you gave. I want to write a story. And it's very interesting. It was about, what do you look for when you hire? And we really look for people that have played some sort of organized collegiate or otherwise organized at a high level sports because they understand discipline, they understand teamwork, they understand commitment, they understand hard work. Right. And there is a profile with that that in. At least in our business, we just see over and over some of the highest performers just constantly, for some reason, they're athletes.
- [18:38]
Ali Donaldson
I mean, I've definitely heard that. I've covered a lot of these professional athletes who have now become founders, investors themselves. And that was like something that, you know, Alex Morgan had told me. She was like, look like my whole job as professional soccer players getting negative feedback. It's getting better. Like, I'm used to that, which I think is a great quality.
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J.D. Hayes
They'll take it. They want to improve themselves. They want to get.
- [18:58]
Ali Donaldson
I mean, it's one of my coaches said, growing up, it's like you want to worry when your coach doesn't say anything.
- [19:02]
J.D. Hayes
Absolutely, yeah. If they're not giving you feedback, they
- [19:05]
Ali Donaldson
don't think you can do it.
- [19:06]
J.D. Hayes
They don't think you can do it. That's 100%. Yeah.
- [19:09]
Ali Donaldson
Talk to me about a recent mistake you've made.
- [19:11]
J.D. Hayes
Probably not following my gut. I've had a couple times here recently. I don't want to get into the specifics. Like, you know, I just knew something was probably wrong or it wasn't the right thing. And we have. One of the things in culture is like, if, you know, if you really feel about something, you just, you need to step up and, you know, say something about it. And we kind of had a. We had a failure with an individual in the company that didn't really align to the values of our company. And it went a little too far. And I just feel like a Letdown. And a mistake was that we didn't catch some things earlier on and we took a real cultural black eye and a company black eye. And I, and I just took the ownership of that along with my co founder. We said, look this, we're going to own this. It's an ugly situation, should have never happened. We're sorry. We're going to do everything we can to prevent it in the future. So if you're in this seat, trust me, you make mistakes all the time.
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Ali Donaldson
And I think owning up to it, that's what people want to hear.
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J.D. Hayes
Yeah, we, we actually did that in our annual meeting with everybody in the room. We were very intentional about it and really just owned it. And that might have been one of the more over the course of a three day event, probably had more feedback on, hey, just really appreciate what you guys did with that because you didn't have to do that.
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Ali Donaldson
We talked a little about tariffs. What do you think is the biggest external risk to the company over the next year?
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J.D. Hayes
18 months, fortunately. And part of the reason why we've had the growth that we've had and been able to be so fortunate to be on this list is not only are we working with iconic brands that I talked about, but I go back to where we do business. Like our retailers are the retailers that are actually growing, right. Because there's a lot of retail that's not making it. Right now retail is kind of tough and so the rich are getting richer, so to speak. And so as more closures and more things happen, the retailers that we have really lined ourselves with are really just going to. So while the economy, so as an example, Walmart usually thrives, right. In a down economy. Walmart is a very important customer to us. You know, the wholesale channel, Costco and Sam's people are going to be pinched. They're going to go look to buy in bulk and we kind of have this like insulated thing. But I, I tell you, it's the economy, tariffs, I mean that's really the two things staring us down. And then I guess at the end of the day too, our brands could always make a choice to go a different direction. Maybe they want to go direct, maybe they don't want to use us and that, that would be catastrophic to us.
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Ali Donaldson
How do you handle that kind of retention for your clients?
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J.D. Hayes
It's all about the value. It's creating the value. A lot of people that are middleware I have found and they always try to play the hide the salami with the clients and the customers. And kind of keep people down in the know. I will tell you, we've done just the opposite. We've invited our clients to be a part of the conversation with our customers. We think them seeing the difficulty that it takes to, to really work day in and day out with these big retailers that we deal with, it's a grind. It's an everyday grind. And letting them see the punches and the, and the blows that it takes, we think is a good thing than trying to hide them from. Because, you know, if you don't, if you don't see, then you don't really know. It's, it's kind of like an example. Just recently, we've been kind of studying the great game of business as an example. And one of the principles in that is if you don't share with the people the real health of the company and how much the company actually makes, and oftentimes they think the company makes like eight or ten times more than they actually do. So there's actually value in just being honest and open about how is the company performing. And it's similar in how we do business with our customers and our clients. So letting our clients see the, the nitty gritty and where the rubber meets the road and doing business with the retailers that sometimes can, can help protect that relationship is a boy. I just don't know if I want to deal with that every day. It's tough. They like being the guys that can come in and the knights in shining armor and, you know, fix the problem. And after we've kind of dealt with them and dealt with the options, and then we tell the client, hey, this is really what we got to do. They like being able to come in and be a part of the solution and not have to get down into the, the grid of it, if, if
- [23:05]
Ali Donaldson
that makes sense in this sort of uncertain environment. JD Is there anything you look at that was really helpful for growth in the last three years, but you're like, this is not going to work anymore. We've got to stop.
- [23:16]
J.D. Hayes
Well, I wouldn't wish a global pandemic on anything on anybody ever again. But for us, boy, it just. People were shopping, they were shopping at the retailers that we were doing business with. And the categories that we play in are toys, home, and pets. And if you go back and look, those were the three categories that were off the charts. So, you know, iconic brands in all those categories. We've mostly talked about the toys, but we work with a lot of pet brands both on treats and, and hard goods. But Also in home. And, you know, home is a boy. During COVID you know, a lot of people invested in home. And so whether that's, you know, decor, whether that's, you know, textiles, whether that's countertop and cutlery and whatever, like people were investing in that.
- [23:57]
Ali Donaldson
Did you have to tell your team, you know, we cannot count on that sort of growth, that this is just sort of an unnatural shock. It's going to come back down.
- [24:04]
J.D. Hayes
We. We were actually alcohol business for a number of years, representing.
- [24:08]
Ali Donaldson
That was another one.
- [24:09]
J.D. Hayes
There was an outside shop representing alcohol company out of Florida. They turned a lot of their alcohol production into sanitizer production, as a lot of companies were. And so all of a sudden, we were selling hand sanitizer for retail use, but then we were also selling hand sanitizer to our retail customers for their own internal use. So they were needing it for their own staff and their break rooms and whatnot. And so there was like a whole nother element of selling to our customer that wasn't the end customer. It was for their own internal consumption. Right. And so we would have conversations exactly what you said. Like, how ironic is this? Like, we would never have thought that our customer would be our customer in these other ways. And like, boy, this is, you know, how long could this last? And, you know, it didn't last forever, obviously, but we maximized it while we could.
- [24:55]
Ali Donaldson
How do you approach leadership? And is there a hard habit that you're trying to break or one that you're trying to say, I want to aspire to this habit?
- [25:05]
J.D. Hayes
Well, I served in the military before I did this, and what branch? I was in the Air Force, and I grew up as a military brat. So I'm a very disciplined individual by nature. And I'm accustomed to having standards and maintaining standards, and so I try not to be so overwhelmed about certain things. I've got, you know, a little OCD as well. And so I've had to work hard to not be as regimented as I like in my personal life, because that's not how everybody is wired. I have to just kind of let things go sometimes. Like, you know, if there's a mess on the counter in the break room because trash didn't throw it in the trash. And I'd think to myself, why can't you just throw it in the trash? You know, and used to, I'd want to, you know, make a deal about it and say, well, can't we just pick our trash up? But, you know, at the end of the day, yes, I would love for that to happen, but that not everybody's wired that way. So I've had to really peel back and learn to be a little bit more subdued and not just such a hard charger on things like that. I've had people tell me, you know, you don't get so worked up, you know, so I'm trying to not get so worked up.
- [26:10]
Ali Donaldson
I think that's a good note to end on. J.D. thank you so much.
- [26:12]
J.D. Hayes
This has been great. It's awesome.
- [26:16]
Mike Hoffman
That's all for this episode of youf Next Move. Our producer is Blake Odom. Editorial editing and sound design by Nick Torres. Additional editing from Sam Gebauer and Tat Wadhams, and our executive producer is Josh Christensen. If you haven't already, subscribe to your Next Move on Apple podcasts, Spotify, or wherever you listen. And your Next Move is a production of Inc And Capital One Business.