Megan Brooks is in the business of solving retail problems for boutique fitness studios. Brooks, who founded wholesale distributor and retail consulting company Astral along with her husband Brian in 2015, now serves clientele across the U.S. Seated in the office of CEO in stretchy, comfortable athletic wear, Megan glances up and smiles each time one of her employees—mostly women in similar attire—pass by the wall of glass.
Recalling her entrepreneurial journey, Brooks remembers “I worked for Newell Rubbermaid for 11 years, starting just out of college. I served in a lot of different roles over the years, but the one I loved the most was the design and management of our customer relationship management software. I loved the process optimization—making sure that data from all of Rubbermaid’s companies was consolidated into a single set of data that a CEO could easily access. “What I didn’t love about that job was that I was working in global IT, and commuting three weeks out of the month from Lexington to Atlanta. The work-life balance was not good.”
Turning a Passion into a Problem-Solving Venture
Brooks decided to strike out on her own in a consultant capacity, providing the same services to numerous companies. As a hobby, she taught fitness classes from a rented room in a local gym where the owner had recently added a line of active wear as an additional revenue stream. While teaching her class, Brooks overheard the gym owner’s complaints about the challenges she had been encountering since adding the retail component to her business. That sent Brooks’ entrepreneurial mind into overdrive, and she wondered—is this problem specific to this studio owner, or is it an industry-wide problem?
Early Validation and Market Demand
In search of an answer, Brooks struck a deal with the gym owner, agreeing to take over her retail business and pay her a commission on any sales. It wasn’t long until the gym owner took to social media to announce that her retail problem had a solution, and within three months Brooks had 11 more studios in three states seeking her services. And she had an answer to her question—the problem was indeed industry-wide.
Pivots, Partnerships, and Persistence While Brooks says she would love to report that her first business model struck gold, in fact it did not. With the spirit of a true entrepreneur, she set about figuring out the fatal flaws and then sought help to remedy them.
Enter Jeff Chochinov—a good friend and former workmate from Newell—described by Brooks as “Harvard educated, strategically smart, and financially savvy.” Brooks flew him to Lexington to pick his brain. “I wanted to show him what I had been doing and get his perspective. I needed to know—do we cut bait and run, do we double down, or what changes are needed to make this work?
“Coming out of that meeting, Jeff made my husband and I an offer to buy part of the company, and we accepted.”
Soon after, Astral Implemented a new model that had small gyms and studios sourcing their apparel and accessories from Astral, while Astral handled everything else—keeping up with fashion trends, intaking returns, tracking sales data and buying at scale to get the best prices. In short, doing all the things that Brooks had determined makes retail daunting for studio owners, simply because their expertise lies in other areas.
Astral’s New Model Takes Off
Astral was off and running, but soon the company’s rapid growth became problematic from a locational standpoint. As the partners faced yet another upsize from their current choppy, fragmented buildings that were located blocks apart, they found that the pandemic had had a profound effect on the availability of commercial rental property. With many businesses shifting away from in-person shopping experiences and embracing E-Commerce, storefronts were plentiful but mixed-use warehouses the size Astral required were scarce, and the ones they found required 10- to 15-year leases. Still, Brooks acknowledged, she wanted to rent instead of buy.
“We had moved so many times and had grown so fast I felt that if we bought something that worked now, we would soon grow out of it and be right back in the same boat. But my husband and Jeff wanted to buy, and they outvoted me.”
The SBA 504 Cure for Astral’s Growing Pains
“When we first explored the idea of an SBA loan to acquire a building, we really didn’t think it was possible for a business of our size despite the growth we had been experiencing,” explained Astral co-owner Chochinov. “However, Community Ventures gave us expert advice throughout the purchase, development and SBA application process. What seemed like a daunting and complex process was simplified, allowing us to focus on the right activities to ensure the application was successful. Owning our building has been transformational to our business as we continue to scale.”
Community Ventures Helps Anchor a Growing Business
Working together with Traditional Bank and the SBA, nonprofit Community Ventures facilitated funding that allowed Astral to purchase a building in an unlikely Lexington neighborhood. Tucked at the end of a mostly residential street inside New Circle Road on the city’s north side, Astral’s presence is serving to improve, strengthen and stabilize the economy there. When renovations were completed, the building had transformed from an empty shell into a two-story, 16,000 square foot workspace that houses Astral’s offices, showrooms, order fulfillment, shipping and warehouse capabilities all under one roof. An SBA 504 loan provided affordable and sustainable funding, ensuring continued growth for the burgeoning business.
Growing Workforce, Growing Sales
Chochinov notes that their strategy in buying their own building has been the right one. While Astral has experienced double digit growth over the past two years, the worries that Brooks had about outgrowing their space too quickly have not come to pass, thanks to both the efficiencies of the building and smart staffing moves.
Brooks is proud of the environment that Astral provides its staff, which today numbers 25. Many of Astral’s hires are following in Brooks’ footsteps. They are women leaving the corporate world to find a better work/life balance, who want more quality time at home with their families instead of working eight to five and then some. Brooks stresses that they are wildly talented, have tremendous experience and bring great energy to Astral. Chochinov confidently projects continued growth. As an example, he points to the launch of a new product line—technical grip socks—that on the surface would seem a simple add, but prior to their move would not have been possible from a fulfilment standpoint. And like all burgeoning businesses, growth necessitates job creation. Astral recently made an investment in their team with three new full-time hires, including a marketing manager and a data analyst. Studio owners and wholesale customers can learn more about retail solutions at Astral’s website or Instagram account @Astral.showroom, while @astralcommunitysale allows fitness buffs and other individuals to stay updated on the company’s periodic public sales aimed at moving along excess inventory.
Because supporting community causes is important to Astral, oftentimes new goods that no longer have commercial value will be donated to local charities Lionheart Trauma Support, Greenhouse 17, The HOPE Center and Eastern Avenue Sober Living. Brooks laughs, “I tell people that yes, we are doing important things at Astral. But its yoga pants, not heart surgery so there is a limit to the stress we have here.”
Resources for Aspiring Business Owners
Do you have a great idea for a new business, or a thriving business ready to go next-level? To learn more about how Community Ventures can help make your entrepreneurial dreams come true, contact Lynn Littrell at llittrell@cvky.org. Visit https://cvky.org/sba-504-loan-program/ to learn more about SBA 504 loans.
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About Community Ventures: Founded in 1982 as a community-based, non-profit organization, Community Ventures (CV) strengthens communities and improves the overall quality of life for Kentuckians by supporting job creation, small business ownership, and home ownership. CV is headquartered in Lexington with branch locations in Bowling Green, Campbellsville, Louisville, Mayfield, Millersburg, and Owensboro. For 21 consecutive years, CV has been named Microlender of the Year by the Kentucky Small Business Administration.
Thriving Business Tucked in Lexington Neighborhood Puts SBA 504 Loan to Work