Molding a growth plan as sales fire up
Glass blowers Nick Savage and Loren Dion had barely moved into new quarters for their Santa Barbara-based Memory Glass last summer when they secretly began to think about calling it quits.
Sales slowed while their rent more than doubled. Cash flow was squeezed to a trickle as retail customers were replaced by funeral homes that bought the pair’s glass keepsakes wholesale and expected to have at least a month to pay.
“It was just a different ballgame,” said Savage, president of the 5-year-old company. He and Dion, both 28, craft glass orbs and pendants that incorporate ribbons of colored glass and a small swirl of the cremated remains of a person or pet.
A year later, the picture at Memory Glass has improved. Cash flow has evened out and sales are brisk for the $150 pendants and $275-to-$400 orbs the pair sell to funeral and cremation businesses, as well as direct to consumers on their website, www.memoryglass.com.
Now, the business partners are worried about how to handle growth.
Every day for the last two weeks a new wholesale client has called to request a Memory Glass display case, Savage said.
He expects revenue to double this year to $200,000 from 2007 levels. The company is close to consistently making enough money to at least cover its costs, he said.
The State Street business also is looking to make a bigger push into the fast-growing pet market, which in the U.S. last year hit $41 billion for the purchase and care of animals, more than twice the level a decade earlier.
Busy with their glass-blowing sessions, as well as sales, administrative, marketing and shipping duties, the owners know they need help but are unsure where to start.
“There isn’t a whole lot of time in the day to do anything other than keep up with orders,” Savage said.
He and Dion are uncertain what tasks they want to hand off and how much they should pay employees. They don’t know whether they should spend their small budget on advertising, marketing, public relations, trade shows or something else altogether.
The business partners, who each take a flat $2,000 draw each month, exhibit at industry trade shows and advertise haphazardly in industry publications.
They anticipate marketing help from a business associate of Savage’s father. The gift-company marketing executive has assisted with paying for and helping out at trade shows and will join the company later this year in a six-month trial arrangement.
They may also get additional help from Savage’s wife, Sarah, a public relations and marketing professional who is able to devote a couple of hours each week to help the team.
But Savage worries about keeping a handle on the upcoming arrangements given his limited free time.
Growing pains were the farthest thing from the minds of Savage and Dion, who have been friends since their elementary school days in Carpinteria, Calif., when they first took up the challenge from Savage’s dad to start the business in January 2002.
Michael C. “Craig” Savage, chief marketing officer of Building Media Inc., a multi-media company focused on the construction industry, had long toyed with the idea.
For a decade, Savage had treasured a glass keepsake containing a wisp of a friend’s ashes, but Savage’s attempts to have his grandfather’s ashes memorialized by glass blowers had fallen prey to a series of mishaps.
When his son and Dion completed a remodel of the Savage family home, the elder Savage suggested the recent college grads next try their hand at making a business out of such glass memorials.
With a $20,000 first-year investment, he set the two up in his garage, charging them $700 a month for the space and a small office.
The new partners gave up on using outside glass blowers after a string of bad luck, including sudden increases in supplier prices and payment demands even for bad pieces. They found a glass-blowing cooperative willing to show them the ropes. They scrounged up a gas-burning furnace, paid for a 2,000-pound shipment of glass from Holland and set up shop.
After nearly burning down the garage “at least five times,” Nick Savage said, the former computer-science major built an electric furnace to replace the dangerous “beast.”
The small firm, which donates a glass pendant to any family who has lost a member to the Iraq war, last year moved into its current location, a former Army barracks in a warehouse area.
A trade show last October marked the beginning of a turnaround, Savage said. It was the fifth year the business exhibited -- long enough to help persuade the conservative funeral business attendees to take Memory Glass seriously.
Today, about 300 wholesale clients account for 80% of sales, including Forest Lawn Memorial Parks & Mortuaries in Glendale and Cathedral City, Coast Cities Cremation in Ventura and Fairhaven Memorial Park in Santa Ana, Savage said.
Memory Glass has potential to expand, but Savage and his business partner are overwhelmed by the myriad of small details and decisions. They are looking to find a way to create a formal, planned road to growth.
“We’ve been doing this really as a friend-family business this whole time, and it’s pretty dumb,” Savage said. “We should have been doing this as a real business and putting everything on paper and we haven’t, but now it’s time to do that.”
(BEGIN TEXT OF INFOBOX)
The Santa Barbara firm makes hand-blown glass orbs and pendants that incorporate ribbons of colored glass and a small swirl of the cremated remains of a person or pet.
Loren Dion and Nick Savage
Founded: January 2002
Start-up funds: $20,000 from family
Revenue: $200,000 projected for 2008
Main business challenge
To decide where to put limited money and time to create and keep up with growth
To expand and structure the business so it is self-sustaining and doesn’t need owners’ daily involvement