Upper Deck’s Baseball Cards Score a Hit : Collectibles: The company’s line of elaborately designed, expensive trading cards have proved hot sellers.

The Major League lockout nearly threw the baseball card business a curve, but Upper Deck, the hottest commodity in that booming market, was already safe at home.

Baseball card sales are typically slowest just before spring training opens. But with the delay caused by the teams’ lockout of players, some expected the retail card market to suffer a prolonged sag.

However, Upper Deck, the Yorba Linda-based manufacturer of slick--and quite expensive--trading cards, had already sold out its 1990 production before the 32 days of negotiations between Major League teams and players ended.

From its inception, Upper Deck has been able to overcome economic obstacles en route to success in a highly competitive field.

When the firm burst on the market a year ago, it faced an uphill struggle competing with the entrenched card company giants Topps, Score, Fleer and Donruss. But Upper Deck introduced several innovations such as color action photos front and back, and it quickly captured the high-end market with its elaborately designed cards.

A full set of Upper Deck cards--if you can get one--commands $55, contrasted with the $22 to $25 prices for one from a rival company.

The baseball lockout would eventually have hurt retail card sales had it continued, Upper Deck President Richard McWilliam said. But Upper Deck already had orders from dealers that assured a sell-out for its entire year’s production, company officials said.

“No other company sells out,” said McWilliam, 36, of Corona del Mar, who played the game in high school and college and has a background in accounting and real estate.

McWilliam was approached in late 1987 by Paul Sumner, who had “a little dream . . . to make Architectural Digest-quality baseball cards.”

Sumner, now 43, of Chino was at the time vice president of sales at Orbis Graphic in Anaheim, and he has a background in printing and holography.

With a third partner, Sumner’s boss, Boris Korbel, the men set out to produce a prototype card impressive enough to persuade Major League Baseball and the players’ association to grant the firm a license to produce cards bearing team logos and players’ photos. Joined by a fourth partner, Richard Kughn, of Detroit, Upper Deck has grown from a small office with six employees to a self-contained printing company employing 250.

Breaking into the big leagues was not easy for the company, however. Upper Deck cards were shipped to retailers for the first time in March, 1989, three months after its competitors had their sets on the shelves.

By introducing several new features--color photos front and back, a hologram scheme to prevent counterfeiting and high-grade paper stock--Upper Deck immediately drew rave reviews and an unprecedented demand. It virtually created a high-end market for baseball cards.

Company officials say their cards are for children and adults, casual collectors and profit-minded investors alike. They are sold through a variety of retail outlets, not just baseball card shops. Despite the fact that they are intended to have a broad appeal, Upper Deck sees its cards as the Rolls-Royce of the industry.

“It really did take off right from the start,” said Bob Lemke, publisher of Krause Publications’ Baseball Cards, a 310,000-circulation magazine that lists card prices in the resale market. “They are just far and away superior in terms of value.”

A Topps 16-card pack retails for about 50 cents at most outlets. The suggested price for an Upper Deck 15-card pack is 99 cents, but the pack is routinely sold for $1.50 and more. At times last year, the packs were going for up to $3, says George France, a Fullerton baseball card shop owner.

McWilliam says Upper Deck’s innovations have inspired changes among its competitors. Upper Deck’s foil packages, for example, prevent unscrupulous dealers from peeking through wrappers to see whether higher-valued players’ cards are inside and keeping those for themselves.

Kenneth Liss, a spokesman for Topps Co. Inc. of Philadelphia, the baseball card industry leader, said his company has since changed some of its wrappers to obscure the contents.

“I wouldn’t say any one company has directly influenced us,” he said. “We’re always looking at new ways of doing things.”

Although Topps, which is in its 40th year of baseball card production, does not release precise production figures, it claims to have sold more than 1 billion cards last year.

Lemke estimates that Topps’ production amounts to about 5 million copies of each Major League player’s card; as recently as 1983, the copies numbered 750,000.

Upper Deck says it purposely limited its initial 1989 production to just 1 million sets of each card, which drove up the demand. (Subsequently, Upper Deck printed more cards that were sold in complete sets rather than in packs of 15 cards each. The company will not reveal how many sets.)

“We’re not really looking to manufacture Upper Deck cards to meet demand,” said Donald M. Bodow, vice president of marketing for the company. “We don’t want our cards to be generally perceived as being as easily available as a glass of water. They are being perceived as true collectibles.”

When Upper Deck announced its intention to limit production, it was “a first in the hobby where those types of numbers are jealously guarded,” Lemke said.

Upper Deck, which is privately owned, does not release its sales figures.

Topps, which also produces candy and gum products as well as non-sports trading cards, posted a record $198 million in sales in the year ending Feb. 25, 1989, more than half of which was baseball cards. Liss said the company expects to surpass that this year.

The baseball card market continues to grow each year, leaving plenty of room for newcomers such as Upper Deck, industry officials say. Estimates of card and memorabilia sales range from $400 million to $600 million a year, Lemke said.

Although Upper Deck’s McWilliam declined to say how much in royalties his firm pays Major League Baseball or the players’ association, Krause Publications’ Lemke estimates the fees to be about 8% of sales.

When it comes to baseball cards, the older, more scarce issues of popular players often resell for enormous sums.

The 1990 Upper Deck card of rookie Baltimore Oriole pitcher Ben McDonald is reselling for $100 because the “rookie” designation was inadvertently left off in printing.

McWilliam curtly denies printing errors--such as that on the McDonald card and one in 1989 in which Atlanta Braves slugger Dale Murphy was reversed, driving up the resale value of that card to $150--are intentional. He points out that the company does not profit from resales.

Indeed, McWilliam said, Upper Deck uses a sophisticated random sorting system that makes the chances for getting a highly sought-after card equal in each pack.

Alan Rosen of New Jersey, believed to be among the world’s largest baseball card dealers, usually has little interest in current cards, preferring to concentrate on the more valuable older items. This year, however, Rosen “will be dabbling for the first time in newer cards, in the Upper Deck cards,” said Greg Sholes, who works for Rosen’s Mr. Mint memorabilia business. “He feels it’s a strong enough product.”

Sholes, who also buys and sells cards himself as an investment, was impressed by Upper Deck’s entrance in the baseball card market.

“I personally have seen nothing like it in the hobby,” he said. “The demand was unbelievable by dealers. I’d say (Upper Deck is) a cut above.”

BASEBALL CARD SCOREBOARD

Upper Deck has carved out a niche in the high end of the baseball card market. The company’s cards command a higher price because of several innovations, including color photos on both sides, high-grade paper and a hologram to prevent counterfeiting.

Estimated price of complete 1989 baseball card sets

June April Pct. Est. Price Manufacturer 1989 1990 Increase 1990 Set Donruss $22 $25 13.6 $24 Fleer 22 28 27.3 22 Score 18 20 11.1 22 Topps 20 22 10.0 25 Upper Deck 32 55 56.3 50 SOURCE: Baseball Cards magazine, Krause Publications Inc., Iola, Wisc.