Texas moms create hallway hit

FORT WORTH, Texas – The trigger was two Plano, Texas, women’s shared frustration.

Two years and dozens of global hurdles later, Christi Sterling and JoAnn Brewer turned a shopping challenge into a multimillion-dollar business by recognizing girls’ desire to express themselves with their middle school lockers.

By August, Sterling and Brewer’s LockerLookz, launched with $50,000 in savings, will put merchandise with a retail value of about $7 million on shelves at specialty stores like Learning Experience and Hallmark, as well as a limited rollout at J.C. Penney. When invoices are paid, their startup will be in the black, they said.

It’s been a remarkable journey for Sterling, who worked more than 13 years handling design issues at a paper company, and Brewer, who spent 20 years in advertising sales. Neither had launched a business or brought a new product to market.

Their recognition of a market niche came when they couldn’t find the right materials to help decorate their daughters’ middle school lockers. And there’s a reason behind demand for such products.

“I don’t know if it’s a rite of passage, but I know it’s a way for a preteen or an early teen girl to assert her identity as a unique being,” said Sarah Hill, 33, an assistant psychology professor at Texas Christian University, who decorated her own junior high locker years ago in Burlington, Wis. “This space is theirs ... to influence or manipulate other people’s impressions of them.”

That’s true among sixth- and seventh-graders at the Fort Worth school district’s Young Women’s Leadership Academy.

“Lockers,” says Samantha Keen, the academy’s social studies coordinator, “are their small space to scream that they love purple hearts or that they collect rubber ducks. Locker decor could keep students from being boring, monotone students.” It helps them to become “unique individuals with style,” Keen added.

Several big players in the locker accessory industry cater to this urge, including LockerMate, which reportedly commands a 71 percent share of a $30 million market, according to Josh Shapiro, vice president of sales at Chicago-based It’s Academic, LockerMate’s parent company. Adjustable locker shelves and accessory kits make up about half LockerMate’s sales.

“With the recession we saw a shift to more basic, less fashion, but there’s still a market for locker products,” said Shapiro, adding that LockerMate revamps its line annually.

The same is true at Dubois, Pa.-based All About the Locker, a line begun in 2008 by teen Sarah Buckel, who had her father produce magnetized “wallpaper” after seeing friends forced to scrape gummy contact paper from middle school lockers. A slew of new designs, two of them created by Sarah, “are on the ocean now,” said Paul Buckel, whose company, Magna Card Inc., bought the line from his daughter, now a college student.

Back in August 2008, Sterling, 50, said her daughter Sara found that the locker accessories available just didn’t fit her idea of cute or fashionable.

Adhesive paper isn’t allowed at Plano’s Prestonwood Christian Academy, and accessories had to fit a cramped space. Craft stores might have a few items, office supply retailers a couple more. But the wares weren’t design-coordinated, and selection was limited.

“It was the summer before sixth grade, and it was a huge thing for her self-esteem to express herself,” Sterling said. Brewer’s daughter, Kendall, the same age and a friend of Sara’s, was having identical problems. Nothing suitable was turning up on the Internet.

After the Sterlings made their own accessories, mothers of other girls got on the phone.

“It was a big deal,” Sterling recalled. “They’d say, ‘Omigosh, where did you get those locker decorations?’”

“We had a light-bulb moment,” Brewer, 49, said of their shared realization that August. “There’s a real need for something that’s cute, easy and one-stop shopping.”

Although functional items were available, the two women believed that there would be a niche market for locker items that were fashionable. Each item was passed by an in-house focus group — their daughters. Sara Sterling suggested mini shag carpets, and Kendall Brewer helped tweak pattern designs.

Their mothers conceived a line of removable wallpaper, miniature shag carpets, wipe-clean boards, wall pockets and other items in bright, diva-glam, sassy-chic designs, including polka dots, animal prints and floral patterns, all affordably priced.

The two women bounced the idea off a Dallas strategic marketing expert, Kyle Priest, after making him sign a nondisclosure agreement. (“We were very paranoid,” they said.)

Priest told them, “You’ve got a tiger by the tail.”

Still fearful of someone stealing their concept, they carried nondisclosure forms to the January 2009 gift show at the World Trade Center in Dallas. There they met Greg Hardin, president of Diverse Toy, a sales marketing organization that deals with mammoth chains and small retailers alike.

It was a fortuitous meeting. Hardin, who had just finished working on his own daughter’s decorated locker, called over his staff to view the items, and then immediately agreed to handle the yet-to-be-launched line on a commission basis.

Now they had to find someone to make all the pieces.

Thumbing through the show’s directory, they found Plano-based Advantage China. Its owner, a former software developer named Ray Sun, serves as a matchmaker, fixing up U.S. entrepreneurs with Chinese manufacturers. “Ray took us through every step of the way,” Sterling said. “He sent prototypes to China, and early samples were sent back and forth, each time tweaked.”

Product development was bird-dogged by Jenny Xu, one of Sun’s employees in Shanghai assigned full-time to the project for a year. Sterling and Brewer paid for the samples and air courier charges, but Sun covered Xu’s salary and travel expenses. If the goods came to market, he would get a percentage of sales.

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To keep Chinese suppliers from stealing the LockerLookz concept, Sun divided production among seven different companies. Wallpaper is made by one firm, the magnet disks that hold them by another. “Each company does pieces and parts,” Sterling said. “One doesn’t know what the other’s doing.”

The partners understood that locker accessories are highly seasonal. If they were to be sold in August 2010, they must arrive by container no later than April, then trucked to the retailers’ distribution centers by May and June.

Diverse Toy’s Hardin arranged to have the women show the prototypes to Hastings, the Amarillo-based book and entertainment chain. In less than 30 minutes, Hastings ordered 15 different items for a test sale at 50 of its stores in 14 states. It was March 10, and they had to be delivered by June 5.

It cost twice as much, but they had the goods sent by air to make the deadline. The shipment arrived a week early — but damaged.

“You don’t need to worry,” said Sun, using his oft-repeated refrain.

Sun arranged to have new cardboard backings printed and plastic blister covers molded overnight in China, then air-shipped to Dallas. On a Saturday morning, the women reached John Cruce of Grand Prairie-based Professional Packaging Systems, just before his golf game. He agreed to heat-seal the plastic blister packs on the coming Tuesday.

There were numerous crises, but also chance meetings with people who believed in Sterling and Brewer, despite their newcomer status.

After the Hasting order was delivered, they set up an e-commerce site, www.lockerlookz.com, whose orders were fulfilled by a Carrollton warehouse. Going live on July 1, the website featured a design-your-own-locker function created by SullivanPerkins Interactive of Dallas that got 7,000 hits the first 30 days.

To move the remaining stock, Hardin approached the Highland Park store of Learning Express, an educational-toy franchise. Others in the chain picked up the line, which was immediately popular with the middle-school set.

“It blew the doors off,” said Shawnette Hanna, owner of the Learning Express store in The Shops at Southlake. “The moms loved it, kids loved it and, as a retailer, we loved it. There’s nothing like this on the market with such fun and funky designs. What makes the line unique is they’ve made girls feel like they’re decorating their own apartment, making their lockers chic and fun and stylish.”

Added Hanna: “We reordered eight times.”

“When that happened,” said Sterling, “we thought: ‘We’ve got something here.’”

With a test season and $200,000 in sales under their belt, the women traveled in January to Atlanta for the nation’s biggest wholesale gift show, then experienced its worst ice storm in 10 years, cutting off FedEx shipments of samples. Hardin proactively spent $4,000 on elevator signs and directory ads, which shook up Sterling and Brewer.

They figured orders worth $40,000 were needed to cover their expenses, which the partners thought would be a challenge if inclement weather kept store buyers away.

Brewer worriedly asked Hardin, “What do you think we’ll do?”

His reply: “$100,000.”

“Actually, we did $500,000 and it was the talk of the show,” Hardin said. “And my firm never had a product line that did half a million at a show before.”

Atlanta was followed by a 50-store test order by J.C. Penney. Then about 140 of Hallmark’s 350 company-owned stores bought the accessories. The women attended similar trade shows in New York and Dallas, as well as making personal pitches to stores in Tulsa, St. Louis, Philadelphia and Minneapolis.

Along with Learning Express, some 1,200 retail outlets will carry the line for the 2011 back-to-school season.

There could have been more.

“We turned down more key accounts than we accepted,” Sterling said. Excluded were big national discount chains, because of a strategy to focus on specialty stores. “We could have sold three times as much product this year if we said yes to everyone.”

“Our product lends itself more to a specialty store where there is more of a personal selling approach,” said Brewer.

Sterling and Brewer, with a stack of hefty orders, now had only a few weeks to raise more than $1 million to get the merchandise manufactured and delivered. Almost immediately, they needed several hundred thousand dollars that they didn’t have for a down payment.

Banks wouldn’t lend to a startup with no track record, they said. There were firms or individual investors who agreed to make a loan on the basis of their bulging order book, but they wanted too much in return, the women said. Still, these last-resort sources of capital were there if all else failed.

Again, fortune intervened. Sterling’s birthday fell during the financial scramble, and a relative she ran into at two family gatherings agreed to lend her the money – just 48 hours before LockerLookz had to wire it to China.

Both the Sterlings and Brewers attend Prestonwood Baptist Church. Also in the congregation are a group of anonymous individuals who invest together through an adviser who places money in business projects where potential profit is not the only consideration. Again, in the nick of time, the rest of the cash needed materialized at a reasonable interest rate.

There were other last-minute saves.

In Xu’s successor in China, another Sun employee named Helen Wu, the Texas partners found a committed, on-the-ground rep. During one crisis, Wu left her Shanghai office and drove 300 miles through the night to a plant so she could personally address a production delay that threatened to upend a make-or-break deadline for LockerLookz. Sun’s crew made China work for these first-time entrepreneurs.

Their 2011 line has 38 items, up from 15. Many are priced under $10 and only one product category, lighting, is priced higher than $20. They have provisional patents on the wallpaper and the lights.

Come summer, 30 sea-freight containers will be offloaded at a larger warehouse in Coppell.

“This has been like eight years of college and business school for all the time we’ve put in it,” Sterling said.

“And we had a lot of guidance, added Brewer, referring to Xu and Wu in China, along with Sun, Hardin and the village of supporters it took to bring LockerLookz to market.

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(c) 2011, Fort Worth Star-Telegram.

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PHOTO (from MCT Photo Service, 202-383-6099): LOCKERLOOKZ