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Simply Simon

Ronald Simon started small.

The son of immigrant parents recalls working paper routes in East Los Angeles and collecting Coke bottles on the beach to get some extra cash when he was only 9.

“We always had food on the table, but we grew up with humble beginnings,” said Simon. “If we wanted something, we had to work for it. It instilled good business sense and street smarts at a very early age.”

The hard work has paid off for Simon, who received a Lifetime Achievement Award at the Business Journal’s inaugural Innovator of the Year Awards on Sept. 24 at the Hotel Irvine (see related stories, pages 1, 4, 7, 8, 9 and 10).

Simon’s business prowess is already well known—he ranked No. 19 on the Journal’s list of OC’s Wealthiest this year, and he’s a perennial member of the OC 50, our annual list of the most influential business people here.

Steel

Simon said the first significant innovation he can recall occurred in the late 1970s when he was working with Perma-Bilt Industries, a cabinetmaker founded by his father. Simon decided to make the company’s mainstay medicine cabinets out of wood products such as particle board instead of steel, which was the industry standard at the time.

“That innovation completely changed the industry,” he said. “Everyone followed our innovation within the next few years.

Simon sold Perma-Bilt in 1987 but continued on the board of directors. He recalls that Taiwan had emerged as a prime competitor, wih prices about 50% less than U.S. manufacturers.

Asian companies were able to achieve low manufacturing prices, but Simon was convinced that through lean and focused manufacturing he could achieve competitive prices and higher quality and keep operations in the U.S.

“I told [the new owners of Perma-Bilt] that I thought we could do it all here and stay competitive, and they said it was a crazy idea,” said Simon. “So I left and started RSI Home Products.”

Perma-Bilt later filed for bankruptcy.

RSI Home ended up buying most of its equipment at auction. Simon remembers the auction as a “fun day.”

RSI Home Products continues to compete with Asia-based rivals via “an innovative manufacturing and marketing approach.”

Today, RSI Home Products is a leading U.S. manufacturer of assembled kitchen cabinets, bathroom vanities, medicine cabinets, storage cabinets, and cultured marble countertop products, according to the company’s website.

The cabinet maker operates as one unit under a holding company, Newport Beach-based RSI Holding Corp., which has an estimated $555 million in annual revenue from a handful of successful ventures, including RSI Development, which carries Simon’s penchant for innovation into the realm of homebuilding.

The company specializes in building for first-time homebuyers by manufacturing components of the homes off-site and then quickly assembling them on-site.

Mountain

“This is really a huge mountain we have to climb,” he said. “There are so many moving parts and outside forces that really make it difficult to build affordable housing, but we are taking a different approach, and our team just keeps coming up with new ideas.”

Simon said the new ideas are usually inspired by the need to adapt.

“Innovation comes from necessity,” said Simon. “Usually, you run into a stone wall and have to figure out a way to either get over it, around it, or through it. What separates entrepreneurs from other effective businesspeople is you have to take risks and put everything on the line, and that also requires innovation.”

Simon is passionate about encouraging and supporting innovation in underprivileged youth—children who are in a similar position to the one he was as a child.

He heads the Simon Foundations, which has awarded more than 850 scholarships totaling more the $30 million. The foundation formed the Simon STEM Scholarship Program with Chapman University and Orange High School.

Simon describes the scholarships as a “college preparatory program” that brings his sense of innovation to the challenge. Many of the Simon Scholars are the first in their families to go to college, and they are selected about midway through high school, providing a couple of years for comprehensive preparation for the challenges ahead.

The program has become so successful that nearly 90% of the kids that graduate high school in the program will go on to graduate from a four-year college, he said.

“When I became successful, I wanted to give back, but I wanted it to be really meaningful and life changing for the kids that otherwise may have given up,” said Simon. “I have always believed that real success is achieving what others believe to be impossible.”

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