[vthobby]

For those that have not seen this.......it just posted a day or 2 ago on the SGC site:

Hello...

Remember us?

We’re the grading company you heard a ton about not so long ago. The grading company that promised to do things differently than everyone else. The team that was apparently “changing the game” by emphasizing service and collector experience in addition to the accuracy and quality of our grades. The company that had seemed to be the last hope for so many of you. The last hope to turn things around and reverse course from the destructive path our competition was leading you down. The path where you had no say, no respect, and no other options. As services continued to decline, prices continued to increase. Turnaround times became downright outrageous and somehow they got even worse from there. The card collecting community needed help, but seemed to have nowhere to turn. That’s when we came in, screaming and shouting about how our experts were the best in the business and our turnaround times were unmatched. We were proud of our company, proud of our 20+ years of grading experience, and we weren’t shy about it.

We spoke, and you listened. It was as if a hobby lightbulb, dark and pent up for 20 years had finally been illuminated, bolder and brighter than ever before. The card community was finally ready to put not just some of its faith behind SGC, but all of it…and then some.

In the blink of an eye, our 12 man team was absolutely overrun. Over just a 7 day period, our intake had increased 20x what it previously had been. We were not only understaffed by about 70 or so employees, we also lacked the necessary policies, procedures, and infrastructure critical to effectively accommodate the new explosion of demand.

The task at hand was significant, and at times overwhelming. It was difficult choosing where to begin. Hiring was an absolute necessity, rapid expansion of space was a must, and our standard operating procedure that worked for 22 years was now completely obsolete. On top of that, with 20x the amount of cards at SGC, we needed 20x the amount of supplies.

As each day passed, the orders at our facility had inched closer and closer to their deadline, the deadline we had told all of our supporters to count on. Before we knew it, we were running behind schedule and SGC had experienced its first ever backlog. Meanwhile, the cards kept pouring in. Although it was far from the largest backlog in the hobby, the nearly half a million cards that we had in our facility were enormous in relation to the 12 SGC employees we had at the time.

Looking back, I realize that I should have come out and addressed the community much sooner than I did. If I could do it all over again, I would have detailed every challenge we faced and kept all of you completely in the loop so that your expectations would remain realistic. Obviously, this wasn’t the case, and I take full responsibility for the mistakes that I made.

Shortly into the surge, we realized we had some very big decisions to make. With all of the cards rushing in, we were bringing in a ton of money—money like our company had never seen before. Do we act as though everything is great and accept the public backlash in the name of immense profits, or do we reinvest all of these new dollars back into the company so that SGC can deliver the service the card community deserves? Staying true to our team’s core values, our minds were made up.

There was no time to waste, and our team immediately started building. We welcomed our first few new employees and more than doubled our workspace. Hobby talent from across the country believed in our message and decided to take the leap of faith to join the SGC movement. While growing the team, we refused to add more individuals than we had time to properly train. Although the need for bodies was at an all-time high, we chose to avoid the corporate mass hiring route. We had seen others make mistakes like that before. Instead, no matter what was going on at the time, I made sure to conduct these interviews myself, ensuring that only the best suited candidates were given the opportunity to handle your cards.

While the team grew larger and larger, we kept close track of the amount of cards we shipped everyday and we set lofty goals for ourselves, constantly looking to improve on the numbers from days and weeks prior. As the number of passionate SGC team members increased, so did our capacity. The progress we were making was rapid and there was no end in sight. Only 3-4 months after having a daily output of 200-250 cards, that number increased to 1,200. From there, our output hit 2,000. Only a short time and a few key hires later, 2,500, and then the goal became 3,000. The investment in ourselves was paying off and it became clear that the SGC model of scaling was the best in the business.

Finally, turnaround times were stabilized and our output had matched the inflow of cards. This was an amazing accomplishment, however, the stabilization took place about 5 months too late and the backlog remained at around 16 weeks. Growing large enough to keep up was hard enough; catching up seemed near impossible. Despite all of the infrastructure we had worked so hard to build, the SGC community was still not getting a fair shake. A turnaround time of 4-5 months is far from “changing the game” like we had originally set out to do. That’s when we decided to do what so many of you had been asking for, for so long.

We embarked on an unprecedented journey to catch up on our backlog and give the card community the kind of service that you all deserve. In addition to spending every last dollar we had on growth, expansion, and innovation, we decided to end all bulk discounts, immediately suspend marketing efforts, increase grading fees, and inflate posted turnaround times to decrease the inflow of cards. Sacrificing nearly all revenue, catching up was our one and only goal. As our payroll continued to grow and our rent and cost of materials stayed steady, the incoming cash flow completely dried up. We were “all in” on our plan to make things right and there was no turning back. The hardest part about it was that we had to keep the entire plan internal to prevent having the inflow of cards pick up with the community's excitement. This would only elongate the catchup process and would surely set us back from our goal.

As the catchup process had begun, we decided to allocate the money we still had into tangible upgrades that our supporters had been asking for. We made substantial investments across the board that we were hoping to reveal right around the time we announced that we were fully caught up…Well, THAT TIME IS NOW!!!

I am honored to share with you that we have delivered. The SGC backlog is completely nonexistent and it is never coming back. All of the apologies, the updates, the setbacks, the blood, sweat, and the tears have led us to this point. SGC is back and we’re ready. It’s built, guys, it’s ours now. This is our grading company, the grading company of the people, and the grading company of the future. We’re taking this thing back and we’re doing it right. Get ready for a grading experience unlike any other. In addition to your cards being graded accurately, fairly, and on time, you can also expect a level of transparency and insight like you’ve never had before. We’re going to take you behind the scenes to show you how this previously mysterious process works. We’re going to speak to you directly via an SGC podcast, where real life card enthusiasts, who do this for a living, share their unique hobby perspectives.

While we’re incredibly proud of our accomplishments and bursting at the seams with excitement, there is one catch. In order to continue to provide you with the service that you deserve, SGC quite literally has no choice but to raise our prices from a base rate of $15/card to $25/card. As unnatural as it feels to increase prices so drastically, we have already seen a tremendous uptick in business from word of mouth alone. Basically, a submitter got his/her cards back extremely quickly from SGC. They told their friends. Their friends submitted, received the same service, and told their friends. With more people made aware of our current turnaround time, our submissions have substantially increased. Our inflow has skyrocketed and although we’re now built to handle it, an exponential increase after this announcement is received, would mean that everything we’ve worked so hard to achieve would be jeopardized. We refuse to let history repeat itself and we will not take in more cards than we can handle. This means that if our capacity is exceeded in the first few days after this announcement is released, we will be forced to raise our prices once again to bring the inflow back to a manageable level. Having said that, our capacity building is far from over and we will be working day and night to avoid a situation where price is constantly increasing. Just yesterday, we received the keys to an additional 5,200 sq. ft. of work space, putting us at nearly 20,000 total sq ft...so far. Our goal is to surpass a daily output of 6,000 cards per day by year’s end.

We have scaled our operation at a pace far exceeding the competition and our work is only just beginning. We want to win more. We love cards more. And we appreciate your support more than they do. These are facts. I see it, breathe it, and live it everyday. Our team is the best in the industry and I am so proud of the growth that we’ve seen in ourselves. We will continue to scale until all cards submitted to SGC are graded and returned the same day they arrive. That is a lofty goal, but it is our goal nonetheless.

Stay tuned for more positive announcements coming very soon and thank you for everything you have done for this growing team. We would not be here without you and we will never stop working to make this hobby better for all of us.

From the bottom of my heart, THANK YOU!

Sincerely,

Peter Steinberg

President, SGC