Small Stationers Being Written Out of Business by Warehouse Stores

Ken’s Stationers has typewriter ribbons, greeting cards, drafting instruments, art supplies and a friendly sales crew to help customers find even the most obscure accounting forms.

But there’s one problem: The store is going out of business.

The venerable stationery store is closing its doors after 32 years at its Honolulu Avenue location, succumbing to the competitive pressures of office supplies mega-stores.

“The store is not closing because the owners are bad businessmen; they have a store to be proud of,” said Ken Hickson, a spokesman for co-owners Bill Johnson and Jim Snow. “It’s strictly pricing that is drawing people away.”

With large advertising budgets, higher sales volume and deep discounting, experts say stores such as Office Max, Office Depot and Staples are pushing smaller stationers to the margins of a marketplace made even more lucrative by the recent boom in telecommuters, home-based businesses and freelancers.

Ever since entrepreneur Sam Walton popularized the retail concept of large-quantity, self-service discount stores through his Wal-Mart and Sam’s Club chains, experts say consumers have been willing to swap snazzy displays and personal service for lower prices.

“It’s the Wal-Mart-ization of retailing and we are seeing it across all retail categories,” said William B. Gartner, professor of entrepreneurship in the Lloyd Greif Center for Entrepreneurial Studies at USC.

The big challenge for smaller stationers is to choose a niche market, he said, and then serve the high-end customers within that market.

That’s just what Robin Caroll, owner of Robin Caroll Stationery in Encino, is doing.

“I do a lot of custom printing, letterhead designs--and we carry high-quality stationery. I am catering to the specialty end of the market,” she said.

“I run at retail price and I don’t discount,” she added, “but I have never had a complaint because people know that we bend over backward to service them.”

Without a niche marketing approach, smaller stationers could find themselves struggling to hold on to customers being lured away by the buying power of the larger retailers.

“If a stationery store is not looking at high-end customers, they are in trouble,” Gartner said. “If they stay in business, they are going to have to reduce overhead” by moving out of commercial spaces and providing products and services directly to businesses from a truck, warehouse or over the Internet.

Sandy Bindra, owner of Bush Stationer’s in North Hollywood, said she has stayed in business for 22 years by attending to her customers’ needs.

“These bigger clubs don’t give you personalized service,” she said. “When you come into my store, we give lots of personalized service--that’s the name of the game.”

Another advantage the independent stationers have over their larger competitors is the ability to sell products in smaller quantities. Bindra said, “When you need 25 envelopes, you don’t have to buy 500.”

Another independent stationer, who asked that his name be withheld, questioned the quality of the materials used by larger chains.

“These discount stores are so big, they can dictate to the manufacturer what kinds of materials to use and what the product specifications should be,” said the Reseda store manager. Smaller retailers don’t have that kind of clout, he said.

Even with a knowledgeable sales staff and quality merchandise--such as $950 Mont Blanc fountain pens--Ken’s couldn’t stay afloat.

“It is very tough to compete with the big-box retailers,” Hickson said. “[Smaller] retailers will never recover unless people are willing to forgo price for customer service.”

Ken’s Stationers’ roots go back to 1957 when Ken Johnson quit his job as an advertising salesman for the now-defunct Ledger newspaper in Montrose and bought an existing office supplies store.

Johnson immediately expanded the store’s product line by adding greeting cards, art supplies, picture frames and ceramic bric-a-brac. Eventually, he opened four stores in Glendale, Sunland and Simi Valley.

In 1977, Johnson’s son, Bill, and business partner Snow bought the business and later added three more stores. However, big-box office supplies stores began to cut into the profits and the partners began selling off the stores. The Honolulu Avenue store--the last remaining store--began its going-out-of-business sale March 25.

Four days before the sale began, Hickson said his company, G.A. Wright Inc., a Denver-based business consulting firm, closed the store, papered its glass windows, took the telephone off the hook and mailed 10,000 fliers to customers about the impending sale.

“Hold onto your shorts,” Hickson told Bill Johnson on the first day of the sale. “You are going to have the biggest day you’ve ever had.”

Hickson’s prediction proved true.

About 1,500 curious customers formed a line that extended from the store’s front door, around the corner and down the block.

They stood in the drizzle waiting for a chance to snap up discounted typewriter ribbons, wrapping paper, drafting instruments, paints, markers, tax forms, ledgers and adding machine tape, among other items.

“I have shopped here since grade school,” said Marlene Barlett of Montrose. “I came here to help them out and to wish them well. It’s bittersweet.”

Hickson said the sale will continue until every item in the store and warehouse is sold.

Sometimes, as in the case of Ken’s Stationers, owners of smaller stores may simply have to bow to economic realities, Gartner said.

“Just because someone gets a business license, that doesn’t mean they are going to stay in business forever,” he said. “There is an ebb and flow in business. You have to know when to call it quits and say you’ve had a good run.”