Management

WEB_CS0407_Cat Spotlight, Lillian Vernon Sidebar
April 1, 2007

Head: Lillian Vernon: Back to the Future Lillian Vernon’s year-plus road to recovery has seen a mix of return-to-roots and get-with-the-times changes. Many have worked, as president/CEO Mike Muoio reports. Here are three additional improvements the company has made: 1. Change the catalog size to preserve the brand. In 2004, Lillian Vernon changed the trim size of its catalog from its traditional 8-inch-by-8-inch format to an 8.5-inch-by-11-inch size. But the change had almost no impact on sales, and since the brand had been associated with 8-inch-by-8-inch books for more than 40 years, Muoio and his team reverted back to the old format last October. “People recognize

Cataloger Spotlight: Lillian Vernon
April 1, 2007

Having topped out at $287 million nearly six years ago, Lillian Vernon’s sales have been falling ever since; it’s expected to finish out its fiscal year at about $170 million. But the bleeding could stop soon. A public company until 2003, the general mer-chandise cataloger was sold to investment conglomerate Direct Holdings, led by media company Zelnick Media. But despite an aggressive game plan to broaden Lillian Vernon’s reach, Direct Holdings’ initiatives largely backfired. Direct Holdings bailed out in May 2006 and sold Lillian Vernon to investment firm Sun Capital Partners, which installed former Miles Kimball CEO Mike Muoio to turn the company

You’re Hıred!
March 1, 2007

As an executive recruiter, there was a time not too many years ago when a CEO of a direct marketing firm would call my office, and the conversation would go something like this: CEO: “Hello, I’d like to talk with you about a search.” Recruiter: “You bet. How can I help you?” CEO: “I am looking for a vice president of direct marketing.” Recruiter: “OK. What key skills are you looking for?” CEO: “I want someone who really knows direct mail.” Recruiter: “Are you interested in candidates who have some exposure to this new channel they call e-commerce?” CEO: “Not really. Our customers have

Executive Focus: Three More Keys to Growing Your Company the Old-fashioned Way
February 13, 2007

This is part 2 of a series begun in last week’s edition of Idea Factory. You can build a sustainable and successful big catalog business without playing accounting games or engaging in financial manipulations. And you can do it without commoditizing and devaluing your employees. Continuing last week’s discussion on how to grow your catalog in an organic and sustainable way without underhanded manipulation, here are three more keys to successful growth. 4. Be a humble, passionate and focused leader. CEOs at high-performance organic growth companies don’t fit the stereotype of the high-flying, bigger than life, charismatic, all-knowing corporate leader. Like the leaders of

Never Too Small to Sell
February 8, 2007

Question: I want to sell my company, but I’m too small potatoes for M&A intermediaries to take an interest. What should I do?

The first thing to ask is whether you have a growth story within your company. That’s the most important thing; that’s the future of your company. It’s in your marketing results, particularly in your prospecting performance. It comes in two forms: prospect mailings and a review of the prospect universe room for growth. The answer is in your proven prospect universe, which is the quantity of names you can mail at breakeven or better. Those names typically come from either standard list

Executive Focus: Three Keys to Growing Your Company the Old-fashioned Way
February 6, 2007

Recent corporate financial scandals have called into question the quality of corporate earnings. Just because we don’t often hear about companies that thrive via positive, healthy, organic growth — by growing their customer base, creating new products and mastering operational efficiency — doesn’t mean they don’t exist. They do. What’s more, these companies convincingly demonstrate that you can be a high-performance organic growth company without resorting to accounting and earnings manipulations and without commoditizing and devaluing your employees. So what’s necessary if you want to grow a successful big business organically? Below are the three keys to successful growth and a few examples of

Kayaking, Partying & Profits
February 1, 2007

There’s a very thin line that ties together the two catalogs produced out of 132 Robin Hill Road in Santa Barbara, Calif. Founded in 1994 as Surf to Summit, a B-to-B catalog of kayakin g equipment, the company in 2001 spun off After 5, a consumer catalog of quirky — often wacky — products for wine and martini parties. After 5 came to life after the company found that its customers were responding briskly to the cocktail party-related novelties that it first offered almost as an afterthought in Surf to Summit. But that’s where any similarities between the two catalogs end. Although the

Chinaberry: Reinventing the Wheel
January 1, 2007

The past decade hasn’t been good to small booksellers — catalog or retail. Soundly beaten in price, selection and convenience by volume-driven big box retailers like Barnes & Noble and Borders, as well as online retailers such as Amazon.com, many of today’s smaller booksellers are barely hanging on. But at least one small cataloger has found a way to reinvent itself and thrive. Chinaberry, a two-title cataloger of children’s books, educational toys, and spiritual and inspirational gifts, has found its own path to modest growth over the past couple of years. The company mails a namesake catalog that offers children’s books and toys, and

Quantifying Year-End M&A Activity
December 11, 2006

At the annual DMA Catalog Council holiday reception held in New York on Dec. 5, two different catalogers asked a similar series of questions.

*Is catalog dealmaking winding down, or is a lot still going on?

*Are the two key buyers driving the market still equity houses and retailers?

*Will there be a lot of deal announcements in January?

They began their questioning by noting that it’s nearly mid-December and while general 2006 M&A activity reported in the national press is at an all-time high, cataloging deals seem relatively minimal.

My answers are fairly similar to this time last year, and they’re somewhat intertwined. Yes, a

Catalog Licensing Agreement Questions Answered
November 30, 2006

A reader of the most recent M&A:Q&A asks: “How long is the typical term of the licensing agreement in these deals? Do they go on forever, as long as either party does not breach? What’s the risk to Blue Sky of investing in these deals and then losing the license in five to seven years?” (Click here for original column)

Larry West responds:
License agreements are typically for an initial term of three to five years, with co-renewal rights. Some can be as long as 10 years. Others, similar to these, can be renewed in perpetuity.

Having said that, you’re right, the ultimate term depends on