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306 Parker Circle
Lawrence, KS 66049
Phone: 785-760-5071
Email: mike@clnonline.com


 


Challenges, problems, and triumphs -- from a manufacturer's perspective.

Printer Version

The Trials of a Small Company

Talent, drive, and product -- but no money.

by Anonymous (March, 2004)

(Editor's note: No, this isn't "Vinny" this time. Instead, we've given the space over to a small, one-person-operation who emailed us about her struggles to gain a foothold in the industry. We are publishing an edited version here because we suspect the vendor represents many others in a similar situation. We checked the company website and believe her main product has lots of potential and deserves a chance in retail stores. In other words, this manufacturer isn't having problems because it's a lousy product.)

Dear Mike:

Your support of small vendors and creative people is so refreshing thank you for every kind word and supportive article. I want to share with you briefly some of my experiences as an innovator/owner of my small business.

I admittedly do not have a business education background or any relatives with money, but I am highly creative, self-motivated, and love to learn. So without the capital to start out of the gate properly, Ive done much of the work that most large businesses hire professionals to do (product development; packaging, pricing, warehousing, manufacturing, distribution, sales/marketing, company logo/colors/identity, accounting, research, hiring patent/trademark attorney, trade/consumer shows, workshops and free demonstrations, website content including photography, and articles, advertising, etc.)

Further, as I am a family-first person with a husband, young daughter, and son, I do most of my work during the midnight hours and outside sales/shows only when my children are in school or with Grandma & Grandpa.

I have no problem admitting that my lack of education and financial resources reveals itself in my packaging and other areas but I had to start somewhere. My test-marketing demonstrated without question that my product would be well received by creative consumers so the obvious next step for me was to get my product in the hands of creative consumers.

As I went cold-calling, demonstrating, and selling to my local independent scrapbook, stamping, and craft stores, I learned about HIA via conversations with store owners. What a wonderful opportunity! Becoming a member of this organization and participating in their annual trade-show would be a natural and smart way to introduce myself and my innovative, patent-pending product to the larger creative community.

I was especially proud of the fact that my product offered a new surface upon which creative people could, well, create. It's an empty canvas which could potentially help sell more of the everything, therefore benefitting storeowners and manufacturers of paper, stickers, embellishments, etc.

So 2003 in Anaheim was my first HIA trade show. Boy, was I proud and excited when so many people came to my booth raving about my product line: "Ive never seen anything like it!" "Ive looked around and you get my vote for Best In Show!" Wow, what a warm welcome!

I was overwhelmed with booth set-up, preparing and teaching a workshop, and non-stop conversations the size and scope of my very first trade show. It was not until I returned home that I realized all the wonderful compliments and rave reviews came from the following:

1. Advertising sales representatives for various publications, seeking money.

2. Producers of other trade and consumers shows, seeking money

3. Sales reps/talent for hire/public relations firms, etc., seeking money.

4. Curious manufacturers, checking out potential competition.

5. Buyers for independent stores ordering product yahoo!

Media.

Ive learned a great deal and continue to learn but my shock of all shocks since beginning my business is the cost of advertising! Unbelievable! I do not know how even the large, big-business budgets can afford the advertising I see them do.

So, whats a small business with a new product/new concept and no capital to do?

I turned to the editorial side of industry magazines, believing when they said, "Send us your product for consideration in our latest-and-greatest article."

This seemed to be answer. Surely the editorial staff of scrapbook, stamping, and craft magazines will see how excited their readership would be to learn about my new product. This in effect, free advertising might generate enough sales that I can actually really advertise one day.

So I put together very complete, very wonderful (in my estimation) marketing packets for the editorial staff of various publications. Editors and tv hosts responded, raving about my product and promising this and that.

Assembling these packets were very time-consuming on my part, but I wanted to make it extremely simple for them. A great deal of time, care, and attention to detail went into every submission.

One editor loved it, asked for more materials, and promised to demonstrate it on tv. I sent the materials but there was never a mention in the magazine and the tv idea was dropped when the editor changed her mind. The bottom line: no editorial mention in any magazine.

My product was demonstrated on tv, but not well and in poor time slots. Promises about appearing on shopping channels never materialized.

I am committed forever to demonstrating my own product, my own way. And every time I do, creative people are delighted and thankful. I receive hugs and thank yous after my workshops. I receive the highest marks on my workshop questionnaires. It is not uncommon for my workshop participants to ask me to sign the back of their projects.

I love what I do creating, designing, teaching, learning, demonstrating, sales and marketing, and supporting my local independent store owners. I love the fact that potentially my product, services, and enthusiasm COULD benefit others in the industry but it is pure hell trying to make a contribution!

It's an almost physically painful experience to have a product which I know from experience creative consumers are thankful to have, but not being able to afford to advertise/distribute in a way that will reach the larger creative community.

Searching for partners.

I need an investor! So letters, invitations, etc., went out to the CEOs/decision-makers of three major companies whose products I demonstrate and promote for free throughout the year at all workshops, demos, etc., and write about in my website articles).

Result? IGNORED. Only one person replied to send regrets. I had to initiate follow-up with another three times before she finally spoke on the company's behalf to say no, the timing didnt work. but there was no request for a later time, which I would gladly have accepted..

Not one to give up easily but getting wiser from the wear at this year's HIA I met with one of those companies I captured his attention when he walked near my booth and he was kind enough to lend his ear for several minutes. One of his questions for me was, "If this is such a wonderful product, why isn't it in more stores? "

Well, where do I begin??????

Mike Hartnett's answer.

This is a classic case of a small company being between a rock and a hard place: She doesn't have the money to grow, and she can't grow without money.

I have checked her website and her product looks like it has lots of potential, but so far it's questionable if most consumers will ever see it. It makes you wonder how many great products consumers have never seen because of the way our industry works.

This tale of frustration is also an indication of the trouble so many memory-related companies must have being noticed. The recent HIA show was a classic example: surely the magazines were swamped with requests for editorial coverage and couldn't possibly satisfy everyone.

The answer, I think, is this: she needs to continue to pursue larger vendors and make a deal with them. Let the companies with the contacts, money, distribution, and marketing expertise do their thing so she can concentrate on her thing: create good products.

In the meantime, if any company (particularly memory related, or wishing to enter the category) wishes to learn more about this company described above, and possibly invest in it, call Mike Hartnett at 309-925-5593 or email mike@clnonline.com.

To read previous columns by "Vinny," who is a top exec at a major industry manufacturer, click on the titles in the right-hand column.

xxx

 

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Vinny's Recent Columns...
ADVICE ON EXPORTING TO THE UK AND EUROPE; An interview with the former CEO of HobbyCraft.

THE HISTORY OF WALNUT HOLLOW; One of the genuine pioneers of the modern craft industry.

HOW MICHIGAN SCRAPBOOKER WAS LAUNCHED; Substantial growth in 3+ years.

THE HISTORY OF PLAID ENTERPRISES, INC.; It's come a long way in 36 years.

"FLASH" SALES COME TO THE INDUSTRY; Q. & A. about the newest way to introduce new products or dispose of overstocks.

SITTING ON A BULLS EYE; What to do if competitors want your market share, or customers want to cut costs.

IS YOUR COMPANY ON THE VERGE OF BANKRUPTCY? 5 SURVIVAL TIPS; Time for a reality check.

FIVE COMMON AFFLICTIONS OF SALES TEAMS; The result: Bad morale and lower sales.

BEYOND MARKET MULTIPLES: INCREASING THE VALUE OF YOUR COMPANY BEFORE THE SALE; How to create a company with greater appeal to buyers.

CHA SHOW NEW PRODUCT REPORT; Hundreds (thousands?) of products, many from new exhibitors.

THE SOLUTION TO MEXICAN DRUG CARTELS; A sure fire way to inspire them to quilt.

ATTRACTING YOUNGER CUSTOMERS; Yes, we aren't our mothers' knitters.

NEW PRODUCTS TO BE UNVEILED AT THE CHAS SHOW; Two parts: new exhibitors and veterans.

WHAT SCRAPPERS ARE SAYING ABOUT MANUFACTURERS AND PUBLISHERS; Scrapbook Updates' readers analyze the problems.

ANALYZING THE CHA ATTITUDE & USAGE STUDY; The rationale and the science behind the number.

REST IN PEACE: JEAN HOWARD BARR; JHB International's Founder and CEO.

POSITIVE NEWS ABOUT THE INDUSTRY; What they want/need from the industry.

COMMENTS FROM INDIE CRAFTERS; What they want/need from the industry.

UNDERSTANDING INDIE CRAFTERS (BY AN INDIE CRAFTER); What they want, what they buy, and how to reach them.

CHA EVENTS FOR MANUFACTURERS; How to get more out of a trade show besides selling your products.

CREATIVE INDUSTRY TURNS TO EDUCATION TO BEAT RECESSION; Simple solutions for vendors and retailers to create online video classes.

WHAT HAPPENED TO CREATIVE MEMORIES? Not adjusting to the times.

COMPLAINING ABOUT SHORT-SHIPMENT PENALTIES; Who pays retail? The vendor?

HOW A VENDOR SCAMMED A SCAMMER; A sharp eye, a sense of humor - and be wary.

HOW A SMALL VENDOR WAS ALMOST SCAMMED; A savvy, suspicious mind averted a serious financial loss.

COMPANY FOR SALE; The owner is retiring.

EXHIBITORS: YOU'RE WASTING YOUR MONEY! Check your customer list before pre-show mailings.

PLAID CONSERVES TO PRESERVE; Simple changes can mean big savings.

SUGGESTIONS FOR THE CHA SHOW; How to attract more buyers and exhibitors.

CHANGES AT A.C. MOORE; They may not be what they seem.

THE TERRI O SHOW IS COMING; Building industry sales by empowering consumers' creativity.

SOME THOUGHTS ON BANKRUPTCY; It's unfair, but...

BOTTLES OF HOPE; A polymer clay grassroots movement.

SEWING SMILES FOR KIDS; Pillowcases and quilts for kids in hospitals.

HELPING THE WORLD IN MORE WAYS THAN ONE; Mrs. Grossman's, C&T Publishing, and Tara Materials.

HELP PEOPLE -- AND THE WORLD; How one company contributes to charities and to Mother Nature.

TAKING CARE OF BUSINESS AND HELPING THE WORLD; Plaid employees' long list of charitable activities.

A SAVVY WAY TO INTRODUCE A NEW LINE; Put it in the hands of consumers and teachers.

CHA AND PMA: SHOULD IT BE EITHER/OR? Why not take the best of both worlds?

A VENDOR'S RESPONSE TO THE PROVO/CRICUT ISSUEE; It's not easy to take sides.

RESPONSES TO CLN'S CODE OF ETHICS...from chain store execs, vendors, and reps.

PROVO RESPONDS TO CRICUT CRITICS; Unexpected demand caused problems.

ADVICE TO VENDORS; Common sense, please!

HOW TO HAVE A GREAT TRADE SHOW; It takes more than great products.

KEY CHALLENGES/OPPORTUNITIES FOR THE CRAFT INDUSTRY IN 2006; Office supply, private label, and direct import.

IS MIKE DUPEY RIGHT? The industry's retail pioneer's criticism of chain stores elicits strong reactions.

RETAILERS: CREATE A "PLACE," NOT A STORE; Customers return if they feel a sense of community.

"HOW AND WHY WE CHANGED OUR BUSINESS"; Sometimes necessity forces gutsy businesses into new, scary areas.

WHY INDEPENDENTS ARE DECLINING AND THE INDUSTRY IS SOFT; We can't improve the situation until we understand the causes.

HOW TO MAKE THE SCRAPBOOK PIE LARGER; "Keep it simple and non-threatening."

INDEPENDENTS: SUPPORT VENDORS WHO SUPPORT YOU; "Support goes both ways. It is a relationship of trust and consistency."

WHAT MAKES A GREAT SALES REP? Colleagues and customers remember the late Bob Watikins.

TRADE SHOW PRESS POINTERS; Maximize your publicity for a minimal cost.

HOW CAN A SCRAPBOOK START-UP SUCCEED? The answer may be a "Group" away.

DO TRADE SHOWS REFLECT THE STATE OF THE INDUSTRY? If we're like other industries, trade shows may be in trouble.

DO TRADE SHOWS REFLECT THE STATE OF THE INDUSTRY? And if so, are we in trouble?

THE STATE OF THE FLORAL MARKET; A blunt interview with Aldik's Larry Gold.

YOU WANT JUNK? YOU GOT IT; Pricing pressures are ruining good categories.

PLANNING THE PERFECT TRADE SHOW; Ten tips for CHA Winter Show exhibitors.

MORE VENDORS RESPOND...; A dialog between vendors and a savvy but unhappy independent.

VENDORS RESPOND TO INDEPENDENT'S PLIGHT; Why vendors have minimums and what retailers can do about it.

RETAIL, E-TAIL, AND "UNFAIR COMPETITION"; Expensive advertising, false promises, and little education.

THE TRIALS OF A SMALL COMPANY, PT. II; Expensive advertising, false promises, and little education.

THE TRIALS OF A SMALL COMPANY; Talent, drive, and product -- but no money.

GETTING READY FOR A TRADE SHOW; Go MAD at HIA.

THE THREE L's: YOU CAN'T SELL WITHOUT THEM; How to look, listen, and learn.

IT WASN'T ALWAYS THIS WAY...; but why does that matter?

WHATEVER HAPPENED TO STRAWBERRY?; Does every new product have to be cheap?