Front windows and an office

When we broke through the wall in our warehouse location we ended up with windows and an actual front door.

We bought some desks and got ready to roll. And we had our first big idea. We would start an online store.

This was in 1998, well before other companies. But, what should we sell? School-Paks were still so new and a lot of people weren’t buying things online as such. After a trip to the store, we decided that Jansport backpacks would be a good fit.

So we called the Jansport rep in and got set up as an account. She helped us pick out a simple selection of backpacks. We got all of the jpgs, all the descriptions all the pricing, set everything up online and sat back, waiting for the sales to roll in.

The sales rep was pretty excited about our attempts as there were so few companies selling Jansport online.

Our first sale came in for a black Super Break backpack. Which we didn’t have. So we began running around to stores looking for one. We finally found it in South Milwaukee at a Kohls store, purchased at retail and sold it for a loss since we were selling at retail and never factored in our gas and time buying it. But we established the fact that customers would buy things online.

We then approached Mead to see if we could get their items online. They showed no interest in working with us. So we ended up with just Jansport at that time.

By 2000, we had a great presence online and were stunned when we received an email from a reporter at the Wall Street Journal.  He had found our site, and some others including Office Depot, and had placed an order for supplies and a backpack. We had sent them out the next day and so impressed him that we were named “Best Overall Value” in a news story. Next we found that MSNBC ran a story about it. We were getting recognized. Finally, we were mentioned on Rosie O’Donnell’s show.

Things were starting to ramp up and all we saw was the road ahead of us. We forgot to check for potholes. And they were there.

Early Years In The Warehouse

1998 was a big year for School-Pak.

Having outgrown Corpus Christi’s library, we were in need of some warehouse space. What a shock to find out how much that space would cost.

Years earlier I had worked for and with Bill Kesselman (from part 2 of the School-Pak story). As a well connected Milwaukee businessman, he provided us with a list of his friends to see who could help us out.

That brought us to Max Gendelman. Max, I believe, was the founder of National Hardware and, after selling the company, had a lot of warehouse space available. My meeting with Max went well, with him basically saying, “If Bill sent you over, we can make something happen.”

Our first area was a 40 by 40 foot warehouse space. We moved our computers (we now had 2!), our production shelves and all of our stock into the space. A small corner of the room became our lunch area.

We were so excited to have finally “grown up”. And then, our first business crisis occurred.

A phone call from the our rep at a school planner company called and asked when we had opened up a location in Arizona.

Apparently, some one was using a mis-spelled version of schoolpak.com for their website.

We made a number of inquiries and found a company named Innovative Learning Products (ILP) located in Phoenix. We made contact with the owner, Ray Lopez. Ray suggested we meet to see how we could “work together”.

We flew out to meet with him and were not “sold” on his ideas. His hope was to flood the boxes, inside and out, with advertising from different companies. Schools at that time were very much against providing advertising to their students so we walked away. Ray eventually sold his company to Innisbrook and went to work for them.

Innisbrook continued to use the name as they expanded into the kit business. Customers and potential schools that went searching for us ended up with Innisbrook. Repeated attempts to get them to stop were ignored. We spent close to $9,000 in legal fees and were finally advised that, even if we spent $90,000 fighting them, they could simply stop using the address and we wouldn’t be able to recover any damages. The big guys would win. Except…

We registered a domain with "Innisbrook.com" spelled as "Inisbrook.com". We started getting their email requests. It took less than a month for them to contact us and exchange domains. Unfortunately they continue to use “Back-To-School Packs” for their kits. That still causes confusion in the marketplace but we’ve learned to live with it.

So here we were, back in Milwaukee, making packs and growing. But we needed even more space. So two years later, we broke into the next room and actually ended up with some office space.

We had made it. We thought.

The School-Pak Story, Part 3 (Corpus Christi School)

There comes a time when the neighbors start complaining about semis coming down the block leaving off pallet loads of glue and glue sticks. We knew it was time to move out of the house.

The first idea we had turned out to be the best. I called on the principal at Corpus Christi school, Barbara Nehrbass, and asked to use the cafeteria during the summer. She said that the cafeteria was used for Bingo, coffee & donuts after Mass, etc., and suggested we take the library. And we did.

The problem was that Terri was still working at the hospital and I was out calling on schools so when the trucks were ready to deliver product, they would call us at home and we'd go to the school to meet them. Terri would arrive, dressed for work, and have to help unload the truck and get them to move fast so that she wouldn't be late.

Now at that point, we didn’t own any kind of shelving or work tables. We put the library tables on concrete blocks so they would be easier to work on and started buying some shelving units.

We kept all of our stock in the library and put the finished packs into the gymnasium. As the end of summer approached, we rented a UHaul truck and began delivering the packs to the schools. We kept that up until our growth took us out of the Milwaukee area.

One of the first things we discovered was that teachers really liked the idea of having pre-sharpened pencils. We contacted the pencil makers and asked them about purchasing the pencils sharpened. No one would do it so we bought an electric pencil sharpener and began sharpening them ourselves. Then we bought another one when that one burned out. Then another one. And finally, the summer was over before we needed another one.

Eventually we were told that we could buy them sharpened but we were charged a free for each pencil! After constantly asking, today every pencil manufacturer provides sharpened pencils and it’s become the standard for all kit companies to offer them.

We also would label all the items for the student, including handwriting their names on the Fiskars scissors. It was pretty work intensive and we finally decided to offer a sheet of labels with each pack. That was back in 1994. Now every company provides name labels. This was the second idea that we had that changed the kit supply business.

 It’s also when we started hiring some help. Those first couple of years they came from family friends and our main source of students, Marquette University High School and Divine Savior/Holy Angels High School. Our son, Nick, a student at Marquette, would provide us with his friends and they worked out extremely well.

But, as we continued to grow, it was time to move on. I began looking for a larger place, hopefully a warehouse. Like anyone else, I looked to friends and associates for help. I had my own “Linked-In” program to use.

Next: The early years in the warehouse.

The School-Pak Story, Part 2

Don't know how this was missed but apparently it was never posted. Here's part 2 of our story.

Crayola became our first company to deal with.

Like most big companies that get approached by a start-up, Crayola wouldn’t give us credit. But they did come up with an interesting program.

All we had to do was send them $2,500 to start our account. (That wasn’t real easy. You see, our total start-up cost was $500. So coming up with 5 times that amount was taking a bit of a stretch.)

As we had things sent to us, Crayola would deduct that from our account until we were almost at zero. Then, another $2,500 was needed.

It’s time to step back a little at this point. In 1993, Terri was working as a group leader in the outpatient department of St. Joseph’s hospital. Her schedule had her working second shift 2 days a week for one week and then 3 days the following week. It didn’t bring in much income but it provided health insurance.

My only source of income came from an interesting place. In 1986 I became a partner in a small company, Station WVCR. We had a vending machine for VHS tapes. We were the forerunner of the Red Box, just 25 years early!

We ended up closing the business as Blockbuster became the major force for renting tapes. We couldn’t afford to keep up with the number of new release copies they provided and eventually had to close our doors.

Our main benefactor, Bill Kesselman, was the financial loser, close to $500,000. Yet, as I’ll write about in the future, he became one of the best mentors I’ve ever had.

I kept the tapes and started a small service, placing films in grocery stores (without the vending machine) and shared in the rental profits. That was now my way of earning a living.

It was tough but we held together for another 5 years before Terri could come on full time. In the meantime, I was the “missionary”, traveling across SE Wisconsin, talking to principals and parent groups about School-Pak.

It was a new concept then and it was pretty difficult getting schools to sign up. Yet a lot did and now we had another problem.

School-Pak outgrew our house!

To be continued.

Unethical Business Practice

In 1991, I founded School-Pak with the core beliefs of providing quality products, a high level of  customer service and a fair price for school supplies.

I have been unable over the years to match the sale prices of items offered by WalMart, Target, Kmart, etc., as School-Pak does not carry underwear and socks, the items that these stores want you to buy. They offer the sale prices on school supplies as a loss leader to their store.

I understand that sales model. It works for them and they will continue to do that. They don’t offer the same level of customer service and convenience that School-Pak presents.

However, I can no longer stay silent about the practices of Educational Products (EPI). I have found that our pricing has shown to be lower than theirs in many cases. EPI, however, will state that they will discount any lower bid than theirs by 3% in order to get the business.

I believe that to be the highest level of unethical business practice.

Consider the following:

You, or someone in your family, is applying for a job. The interviewer asks you what salary you need. After offering your number, another applicant, not having the same skills as you, responds that they will take 3% less than you. And you lose the job.

Or worse. Someone comes into your employment and says they'll do your job for 3% less. And you lose your job.

I can’t change the mindset of people who believe that the lowest price offsets business ethics. I can only believe that most people will do the right thing.

Terri Schulist

Founder, School-Pak, Inc

The Beginnings of School-Pak, Part 1

I had mentioned on our facebook page that we were entering our 23^rd year. Boy, that time went fast.

Someone messaged me asking how everything began. So I thought I’d share a little bit about our story.

It was August of 1991 when Terri went shopping for our son, Nick’s, school supplies. Like so many people, she grabbed that list and went off to the store. We didn’t have WalMart’s in Milwaukee back then so the first destination was Target. She couldn’t find everything on the list so the next stop was K-Mart. Not good. Office Depot? Office Max? Walgreens? It didn’t matter. No one carried all the things needed.

Back in the 90’s, there was an organization named SHOPA that catered to all the major suppliers. They were the ones who selected colors for the upcoming sales year. Purple colored folders were available in 1990 but not in 1991.

Terri followed a mother and daughter from store to store looking for that elusive purple folder. Finally, the mother grabbed a folder from the shelf and a Sharpie. She wrote “purple” on the folder and gave it to her daughter with the instruction, “She can take it up with me”, referring to the teacher.

Of course, the little girl was in tears realizing she was the only kid in the school without a purple folder. Which actually wasn’t the case in the end.

So Terri came home, sat down at the kitchen table and said, “There has to be a better way for families to enjoy summer than getting into arguments at the store.” And so, School-Pak took root.

We spoke to our son’s principal at St. Catherine’s school in Milwaukee about providing a kit with everything on the teachers’ lists. She agreed to let us give it a try and also let us use her name with some other Archdiocesan schools.

That first year we worked with 7 schools. We still provide kits to St. Catherine’s, St. Monica’s, St. Jude’s, St. Mary Visitation and Holy Family. Unfortunately the other 2 closed, as so many Catholic schools do in large cities.

Buying product was the real issue. If we bought it at retail, we couldn’t make any money selling it to the parents. So we started searching for sources. Our other son, Jason, made contact with a school supply company in Skokie, IL, Swenson’s School Supplies. Karen Swenson was kind enough to help us get started by providing items at a very minimum markup.

We also started shopping the sales at the stores, but we knew that couldn’t work for long. We needed to find a way to buy direct from manufacturers. Our first contact was with Crayola and it was an interesting start.

To be continued

Gene

Random thoughts as school approaches

Kept thinking about the following last night while trying to sleep:

Random Thought 1 

 Our local Walgreens is promoting a free back-to-school supply event. You go into Walgreens, purchase the items (of course Walgreens isn't discounting the items) and place them into a bin. Makes Walgreens look good (and profitable) helping out kids. Why don't they just donate the items?

The same goes for Wal-Mart, now having a special give-away. C'mon. Why not just donate the items and not sell them? It's no different than the food stores that ask for donations at Thanksgiving and Christmas. It's not really coming out of their pocket. Every year we're asked by non-profits across the country for donations. We do donate to a number of causes but we don't sell them the items.

Random Thought 2

Just had to deal with a school that was asking for a specific sketch book, a Strathmore one. They were for all students in the school from Kindergarten to Grade 8. We were able to supply (our price is just under $9 for the book) to those who bought School-Paks. But what about those parents that didn't order from us. Where do they find it?

We found them at an art store for $19.95 each. Do teachers realize what some of these items cost? Does a Kindergarten child need that quality? Just wondering.

The same goes for specialty compasses, protractors, pens, etc. What happened to common products? Parents are not going to find some of these specialty items without making numerous trips to numerous stores. Of course, that makes us look good. :)

Random Thought 3

Since we're limited by inventory and workers, we close our final ordering date in late July. So how should we answer "Hi, I see that you are out of stock and don't have any more packs. Can we still order?"

Huh? If we're "Out of Stock" it means we're "Out of Stock".

Most schools start taking orders in March giving the parents up to 4½ months to place their order. I'm not sure why they procrastinate for that long.

I wish we could keep enough inventory in stock for the entire year but it's just not possible. 

Random Thought 4

Without a doubt our economy is still struggling. According to the "economic gurus" we need to stimulate the economy again to propel consumer buying. If enough people buy items, we'll need more workers goes the story. So Terri came up with a brilliant idea. We've tried sending it to elected officials but our campaign donations are non-existent so we never get a reply.

Terri is suggesting that the next stimulus be the issuance of debit cards to citizens. The amount doesn't matter (we didn't go that deep into it) but there would be a 180 day expiration date. The cards could only be used for purchases and could not be used to put money in the bank or pay bills.

Just think of a few hundred million citizens with a $300 - $500 debit card purchasing items. The Consumer Spending Index should go through the roof.
Remember, you read it here first!

Summer's half over

Summer keeps speeding by and we're getting a lot of orders. Hard to believe that we're at the half-way point. And we're having a problem with a large supplier, Mead. Apparently the "big" retailers (Wal-Mart, Amazon, etc)have items made specially for them by Mead. So when customers go shopping and find something they like, they ask to put it into a School-Pak. But Mead has restrictions on selling the items to us. They have to get a release from these retailers. That takes us out of the running if a school is asking for the product. We have an agreement with Mead for their products but these don't show up in their catalog as they are specially made. I guess exclusivity is what all of us retailers would like. It's hard enough to stay competitive with multi-million dollar companies. We'd just like a level playing field when it comes to product accessibility. On a side note, teachers are still asking for items that haven't been made for years. We keep getting requests for "Spacemaker" pencil boxes. Sorry. These haven't been around for about 5 years. Teachers may be using "Spacemaker" as a generic term. Unfortunately, parents that go shopping will be looking for it. The same with "Duo-Tang" folders. They're history. The company that bought their manufacturer dropped the name. But back to the good news. The temperature today is a little more comfortable in the warehouse and our workers (college and high school students)are doing an incredible job this summer.

Blown Away

We're starting to price out packs for schools and, once again, it's stunning how the lists have changed.

Back in the day, 1991, when Terri thought of starting School-Pak, the first lists we received from schools had the usual items on it. A box of Crayons, some markers, a couple of folders and notebooks, maybe some colored pencils, a glue stick or two and some looseleaf paper.

We were so apprehensive that the packs cost more than $20.00. Who in their right mind would pay that much just for school supplies? I remember that first year when we went through all the work and sold just 1 pack at one of our 7 schools. We were doomed.

Eventually parents caught onto the idea of convenience and we began to grow. And so did the packs. Soon we were up to 6 glue sticks, 2 packages of paper 6 folders, 6 notebook, compasses, protractors, etc. You get the picture. The price went up yet parents bought because they wanted to be sure to have their kids ready for school.

Our first culture shock came in the late 90's when teachers began asking for tissue! Tissue!!!

What did that have to do with being ready for school?

OK. we added tissue. Of course the next year, teachers wanted 2 boxes of tissue since not everyone brought tissue. Fine, each pack got 2 boxes of tissue.

Oh boy! Sometime in the early 2000's, a new substance was found in schools that changed science and the way we live. They found ... lice!

Now all the headphones had to be wiped down with baby wipes so lice wouldn't spread. Makes sense. But shortly afterward it was noticed that kids had "dirt" on their hands. Here came the hand sanitizers. (Didn't schools have soap and water?)

Oh wait. Next came soft soap for the kids. And it kept growing.

This past year I worked on a quote for a school that was incredible. The teachers were asking for 6 containers (80ct) of baby wipes. A package of paper cups, 24 plastic forks, a roll of paper towels, 24 plastic spoons, 4 (yes 4) boxes of tissue, 3 containers of Clorox wipes and two boxes of ziploc bags (gallon and sandwich).

All told, the pack cost $94.48. When we took out the "grocery" items, the price dropped to $62.62. So the grocery items represented over 50% the cost of the school supplies.

Now with 20 kids in a class (although there are stories of 40 in a class)your looking at 800 sneezes per child or 16,000 to 32,000 sneezes per classroom. No wonder they need all those Clorox Wipes.

Someday maybe we'll go back to the old days. And then we'll lead all the competition by putting sleeves into the packs. They worked well in the past. (Of course, moms probably didn't like it.)

School Supply Addiction

Finally (my second surgery for a detached retina was in August of 2011) I was going to get the cataract surgery that would start the return of eyesight to the left eye.

I spent the morning answering emails and in meetings so I was pretty pumped for the 2:30 event.

My doctor had told me that it normally takes about 15-20 minutes for the surgery. Mine lasted about and hour due to all the trauma the eye had gone through with 2 surgeries in August.

What was most interesting was the return visit on Friday. The outpatient clinic is right next door to a Starbucks. Not only was the drive through backed up on the lot but the line of cars actually extended out to the street for another 4-5 cars. Unbelievable.

We went into the clinic and rode the elevator with a woman who was holding a Starbucks cup in her hand. Naturally, the first question I had was, "How long did you wait in line?" She looked at me and said "I won't go to this one. The lines are always too long. I stop every morning at a different one on my way to work."

That got me thinking. People stop, some every morning, for their $4 + cup of coffee and think nothing of it. There's approximately 225+ work days in a year so they end up spending around $900 a year on coffee.

Many times I'll speak to a coordinator about our programs and they'll tell me that they need to go with a different company because "these are hard times. Families are suffering and our parent organization wants to help them with this type of program. So we're going with the lowest price." The difference is price might be $2.00 more for a School-Pak. Realize, of course, that not every coordinator says this and not everyone in the school community would necessarily agree. Some would be willing to pay a little more for the quality.

I believe that providing exceptional service plus quality brand name products like Crayola, Elmers, Fiskars, etc., would make that $2.00 (once a year) a great value.

So here's my question: What can we do to make buying a School-Pak addictive? Send me some ideas and maybe we can get on TLC with "Strange Addictions". Could be a riveting program. :)

Feel free to comment

Is the Modern Family too Modern?

Milwaukee has joined the nation with a teacher being accused of child enticement. Stories are showing up all over the Internet about teachers, coaches, band leaders, scout leaders, just about anyone we've believed we could trust, that are facing charges.

What's going on? Is this a new phenomenon, or are we getting kids to finally step forward and report these incidents?

Having grown sons, we're now faced with worrying about the grand-children. We know that our sons' families are aware of the problem and spend the time vetting those people that are in contact with the grand-kids. With an 8 year old and a 4 year old grandson, my eyes lit up when I read the new issue of TV Guide.

On page 12 there's an article by William Keck about Modern Family. In an upcoming episode, Phil (Ty Burrell) finds out that Haley is not a virgin. According to Keck, Phil "is horrified but it ends up being very heartfelt and meaningful".

Claire (Julie Bowen) has know for some time and apparently had dealt with it without telling Phil. And, although Keck writes "Julie had the most difficult time with the plotline", Bowen's comment at the end of the story is what stunned me.

Asked of she dreads facing this rite of passage with her kids, she jokes, "My kids are boys. So they can have sex at age 6 and that'd be fine."

Would she make her daughter (if she had one) wait until age 7? 8? 9?

Really? Maybe the Modern Family is too modern.