Custom Logos
Founded:
1986
President and CEO:
Alan Mittleman
President and CFO:
Jeff Golumbuk
Employees:
49
Projected earnings for 2001:
$7.2 million
Projected earnings for 2002:
$8.2 million
Headquarters:
7889 Clairemont Mesa Blvd.
San Diego-based Custom Logos got its lucky break thanks to a bi-coastal bet between Mitt and Gumby.
Co-presidents Alan Mittleman and Jeff Golumbuk , or Mitt and Gumby, as they call themselves , have been best friends since childhood. Each of their fathers owned a business, and they both had backgrounds in business , Mittleman in finance and Golumbuk in sales and marketing.
So it just seemed natural to them they should buy an already existing business and run it together. But at the time, Golumbuk lived in San Diego and Mittleman was living in Boston.
Eventually, they decided that whoever found the right business first would get to stay put, and the other one would have to move cross-country to join him, Mittleman said.
From that point on, each of them started looking around , talking to business owners and researching companies. It was Golumbuk who found it.
In 1989, Golumbuk was about to get married, and he wanted to create a few gifts for his groomsmen. That led Golumbuk to Custom Logos , and as luck would have it, the owner was interested in selling.
“The next thing you know, he’s on the phone to me, saying, ‘I found the business to buy.’ And I was coming out here for the wedding, spent some time out here,” Mittleman recalled.
So these childhood friends looked over the business for three consecutive days.
Felt It In Their Hearts
“We met with the owner, looked around, got a sense of the business,” Mittleman said. “We just felt, in our hearts, that this was a business that we could run.”
Golumbuk agreed.
“There was a buzz. There was an energy about this place. And it’s remained and grown since we’ve had it,” he said.
They bought the business in July of that year. At the time, Custom Logos was just a typical screen-printing shop with a few broken-down machines, five employees, 1,700 square feet of space and about $175,000 to $200,000 worth of business annually, Mittleman said.
“We decided to take what we had learned working for big business, and apply it to a very small business. It worked, and it grew very quickly. We did about $1.1 million in the first 12 months that we owned the business,” he said.
Growth At ‘Conservative Pace’
Since then, Custom Logos has been grown at what Golumbuk termed a “conservative pace” of 15 to 20 percent of total revenues annually. In recent years, that has worked out to about $1 million of additional business every year.
The company has also grown in size as well. As more business came their way, Golumbuk and Mittleman rented more space until they ended up purchasing the entire 10,500-square-foot building in January 2000. A year later, the last tenant left, and they had the entire space, Mittleman said.
Part of the reason behind their success is that they remain conservative with their business.
“We don’t try to blow it up real big in any one year. We try to let the revenue growth contain us in terms of growth, so we don’t burn up and flame out, like we’ve seen in the high-tech and dot-com industries,” Golumbuk said.
One example of their conservative approach is in their number of employees. By 1997, the company had grown to 48 employees and was doing $4.2 million worth of business. But in 2002 the company will have 49 employees to handle $8.2 million worth of business, he said.
There are several reasons why Custom Logos has been able to almost double its revenue with roughly the same number of employees. For one thing, Custom Logos has changed the way it does business.
Larger Orders
“We used to have three retail showrooms in the county, and we looked for every order in the world , from your brother-in-law’s bachelor party to somebody’s graduation. We specialized in small orders. Now we tend to deal almost exclusively in corporate business , for a casino, Qualcomm, the city, American Cancer Society. Our runs are a lot larger,” Golumbuk said.
Currently, the average order is usually $1,350, but orders come through every day for $5,000 to $25,000, he said. Five years ago, the average order size was $600, he said.
However, it’s no more difficult to set up a $1,350 order than it is to set up a $600 order. Larger orders mean more revenue but less time spent setting up jobs, handling materials and doing paperwork. That makes each worker more efficient, Golumbuk said.
At the same time, larger orders mean that each individual sales representative generates more revenue doing roughly the same amount of work. That means the sales staff is more efficient as well, he said.
Automated Facility
The major investment comes in new equipment. That means everything from a stitcher that can embroider a dozen baseball caps simultaneously, to laptop computers for the sales team, Mittleman said.
“We’re a fully automated, state-of-the-art production facility. From an administrative standpoint, we have a computer network that we’ve invested a ton of money in that has made our staff more efficient,” he said.
Custom Logos does about 70 percent of its work in-house , mostly screen-printing and embroidery. The company farms out the remainder of the work, including logos on key chains, coffee mugs, Frisbees and so forth, Golumbuk said.
For in-house work, the company keeps a large inventory of supplies, such as blank T-shirts and blank baseball caps. This keeps costs down, and also enables Custom Logos to take on rush jobs.
Rush jobs, in fact, make up about 20 percent of Custom Logo’s business, Golumbuk.
Rush jobs were particularly prominent in the aftermath of the Sept. 11 terrorist attacks on the New York World Trade Center and the Pentagon.
Many businesses hastily changed pending job orders to include American flags added on to a ball cap or a shirt sleeve. The week after the bombing, Custom Logo stitched or printed about 1,000 flags, Mittleman said.
On another occasion, the Miramar Officers’ Club wanted about 1,000 shirts overnight, timed to coincide with the Miramar Air Show. The company was able to deliver, he said.
Quick Turnaround, Good Price
Gary Yunker, operations manager for the club, confirmed that he has frequently relied on Custom Logos in the past 11 years. A typical order would be for 500-1,000 shirts, and might often be a rush job with quick turnaround.
“We get so swamped with things that we can’t do things in a timely fashion. And so, we call them, and they’ve always helped out tremendously,” he said.
Doris Tyler, director of material management for the San Diego Blood Bank, agreed. The agency gives out about 6,000 T-shirts a month, and places orders for about 40,000 T-shirts at a time, she said.
The blood bank is satisfied with the work Custom Logos has done over the past year and a half. Although the agency has used many other companies before, it has to find the best price on its limited budget, Doris said.
“We’re a true nonprofit,” she said. “If I can deal with a vendor that can bring our costs down, that’s something that a nonprofit goes for. Custom Logo, the last two times we’ve placed bids out, has been very inexpensive.”
To Mitt and Gumby, the secret of their success comes not only from good management practices, but also enjoying what they do.
“Our internal motto is ‘have fun and make money.’ To us, they’re one and the same,” Mitt said. “If we ever stop having fun or stop making money, that’s when we won’t do this anymore.”
“It’s a fun business. It’s not insurance or something where you have to sell people something they don’t want. People love to see their name on stuff,” he said.
