Pair Has the Competition Covered
For Kathy Olsen and Suzette Wehunt, the most difficult part of becoming entrepreneurs was cutting the umbilical cord to their former employers, leaving behind a dependable, weekly paycheck to go into business for themselves.
Nearly three years after stepping out into the great unknown of self-employment, the twosome seems to have made the right move. The four-employee company, Computer Covers Unlimited, a manufacturer of dust covers and other accessories for personal computers, has grown rapidly to a sales level of $400,000 for 1990, up from $26,000 when the pair took over.
Despite formidable competition, the company has carved a niche by paying close attention to product quality and individualized service. Clients include a high number of school districts and government entities, in addition to computer retail stores.
All of the company’s computer covers, trademarked Nycov, are cut from raw nylon at its Clairemont Mesa plant and sewn by independent contractor seamstresses in San Diego.
Recently, Olsen and Wehunt earned the distinction of becoming the first beneficiaries of a $25,000 annual San Diego Women Business Owners Grant, given by sponsoring organizations that include Women’s Enterprises, the U.S. Small Business Administration and Southern California Women for Business Ownership.
They beat out 100 entrants to win the award, gaining the favor of a panel of judges that included local businesswomen Jenny Craig, Gail Stoorza-Gill, Joyce Bonneau, Ingrid Croce and Judi Sheppard Missett, among others.
The grant money came from dozens of donors, including Jenny Craig International, General Dynamics, Wells Fargo Bank, Union Bank, Avon Products and First California Bank.
The award is meant to highlight the success of women-owned businesses and provide them with capital to develop specific business plans and products, said Women’s Enterprises President Joann Mockbee.
Olsen, 40, and Wehunt, 39, acknowledged that their decision to buy Computer Covers Unlimited in early 1988 from its previous owner was a risky venture. Both left jobs with salaries of more than $40,000 of year.
But both were debt-free, single----Olsen at the time was a divorced mother of a teen-age son----and looking to make career changes. Of comfort was the fact that the company they were buying had a product already on the market, although sales were at exceedingly low levels.
Olsen left a job she had held for six years in the finance department of IVAC Corp. of San Diego, where she had specialized in computerizing office functions. Wehunt had spent eight years in a marketing position with Clark Security Products, a San Diego-based wholesale distributor of locksmith supplies.
The two met as members of an investment club and joined forces as consultants in their off hours. The previous owner of Computer Covers Unlimited hired them as consultants, and a year later offered to sell them his company.
“We had fallen in love with the product line and with its purpose, which is to protect the investment in a computer and the people who use them,” Wehunt said. The market looked as though it could be fertile if they could accentuate individual attention to clients.
The company’s covers were made of lightweight nylon that allowed personal computers to “breathe” after being turned off. Other plastic coverings trapped heat inside, shortening the life of the machines, Wehunt said. The company says that only three of the 40,000 or so covers it has sold in the past three years have been returned for faulty manufacturing.
The company’s product line has been expanded to include keyboard protectors and radiation screens for terminals, but both of those items are manufactured by outside companies.
The women put up no capital--they had none--but agreed to pay the seller of the company a royalty on future sales. The company they acquired had $15,000 in inventory--about half of it obsolete--plus 1,000 yards of material and $2,000 in receivables.
The company grew mainly through an aggressive direct sales approach to high volume buyers, including school districts and government agencies.
“The difference I have seen in their covers is they are made of nylon as opposed to clear plastic covers, which get hot from the machines and crack,” said Kim Glemser, a buyer for the San Diego Unified School District in charge of computers, software and accessories for the district’s 165 schools.
“They do have lots of competition. Just about everyone offers computer covers,” Glemser said. “But their stuff is better quality and they are local. In case there is a problem, they can come and service the account more easily.”
Manjula Jain, vice president of purchasing at Byte & Floppy Computers retail store in Kearny Mesa, said her store carries Computer Covers Unlimited products because of their high quality.
“We have been carrying them for five years. They are custom-made and the quality is good. They are not unique--there are several people who make the covers, but (Computer Covers Unlimited’s) quality has been good. The service is very good. We don’t have to do any returns.”
The company plans to use the $25,000 grant to help expand its market from mainly San Diego County to other cities on the West Coast, Wehunt said.
