MINNEAPOLIS, Minn. – Leo Odden is one of the survivors of the vicious competition and brutal rationalization that has seen so many farmers and companies in the grain industry knocked out of the game.
His business has been profitable every year since 1970, something few in the industry can claim. But now, at the age of 69, Odden is beginning to ease away from his hectic pace.
“I’ve started taking the last week of the month off,” said Odden, who began working as a barber at the Minneapolis Grain Exchange in 1970 and moved his chair into its present room in 1978. He says he has no plans to fully retire any year soon.
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“I must have gotten used to coming in here,” he said with a broad smile.
One of his customers from the grain trade, sitting in a chair awaiting Odden’s attention, piped up: “He’s the best barber in the world.”
Odden’s career offers an instructive business lesson on how dependable profitability in a mature industry, with little chance of getting rich quick, can lead to better long-term results than a higher risk-reward strategy.
During the 1980s Odden tried his hand at the riskiest of all businesses: farming. After four years the farm boy from Wisconsin wasn’t making money and he couldn’t stand taking all the financial risks that modern farming entails.
“I couldn’t make the rent (on the land), so I quit,” said Odden, without a hint of regret in his voice.
Farming had also scared him because he was using his income from the barbershop to prop up his farm, and that seemed crazy.
Farming meant he had to lock his barbershop door for weeks on end at seeding and harvest, and the results didn’t justify it.
“It went all right, but I couldn’t give up the barbershop. It didn’t make sense, taking money out of here to make that work.”
Four floors above his head, on the trading floor of the grain exchange, billions of dollars wash around every year, providing a perfect opportunity for a speculator to make the kind of windfall gain that could eliminate the need to survive on $17 US haircuts.
But Odden, who talks to commodity traders and grain industry officials all day long in his shop, said the trading bug never bit him. He realized from the start he wasn’t a risk taker.
“The first advice the week I got here was from an old trader who told me not to bother with commodities,” said Odden.
“It’s easier to sink than it is to fly.”
And he doesn’t put much stock in the trader chatter about market direction that he sometimes hears.
“They’re all looking for the signs of what makes it go up or down, but it’s all conjecture. Anyway, they don’t talk too much. They don’t want to give advice. They’re scared the dumb barber will go and take a position.”
The Minneapolis Grain Exchange is a lot quieter than it used to be, when it was a bedlam of messengers and ringing phones and traders dashing in and out of what is still the centre of hard red spring wheat derivatives trading. But Odden is as busy as he wants to be.
“I still have customers I had then,” he said.
Fortunately for Odden, he chose a business that is inflation-proof. Unlike crop prices, haircut prices tend to closely follow inflation.
“A regular haircut should be equivalent to an average hourly wage,” said Odden.
In 1957, when he graduated from barber school, that was $2 per haircut. Now it’s $17.
The death of dozens of large grain trading companies, the near disappearance of cash grain trading at the exchange and the shrinking number of floor traders has given Odden the flexibility to take time off when he wants it, but he’s still making money and enjoying the business.
“I get all these hotshot city guys coming in here and I get to tune them up,” said Odden, before beginning another haircut.
