Friday, August 15, 2008

Fit to print: H.P. graphics firm grows as it taps niche in big industry The Business Journal of the Greater Triad Area

- by Matt Evans The Business Journal Serving the Greater Triad Area

Don and Hilda Allen, owners of Alpine Graphic Apparel in High Point, expanded their slice of the promotional products industry when they purchased a competitor.

When a growing small business wants to grow even faster, sometimes it helps to look at "the whole pie."

Don and Hilda Allen have been enjoying their slice of the promotional products industry since 2000, when they founded their family-run business, Alpine Graphic Apparel. About 90 percent of their business has traditionally come from selling custom-embroidered shirts and other clothing to local and national clients.

But apparel is just a piece of the promotional products pie, and those logo- emblazened coffee mugs, pens, clipboards and almost anything else businesses hand out are a healthy niche of the industry, too. Those other goodies accounted for just that last 10 percent of Alpine's revenues last year, Don Allen says, but that's changing.

"Our emphasis had always been apparel. The rest was just a nice kind of corollary," Allen says. "Now we're encompassing the rest of the line in a very active way, and finding that there's a lot of available market."

Organically growing a new market niche can take a while, but Alpine Graphic found a shortcut: It bought the new niche. A few months ago, the Allens bought out the promotional products business of Personally Yours from High Point entrepreneur Carol Friedman, who was retiring.

Personally Yours was practically a mirror image of Alpine Graphic, Allen says.

"Our business was 90 percent apparel, and she was only about 10 percent apparel and 90 percent other products," Allen says. "That made the move a perfect fit."

The acquisition meant instant growth for members of both teams. The Allens and one other employee had been doing just about all their selling themselves, Don Allen says, but he acquired three experienced sales reps in the deal and is adding a fourth.

He declined to discuss revenue, but Alpine Graphic has expanded its office space off of Eastchester Drive near Piedmont Center to make room for an additional product showroom and more meeting and office space for staff.

Wide Product Variety
Tom Bass was the senior sales representative for Personally Yours, and now for Alpine Graphic following the merger. He's been selling everything from inexpensive pens to pricey customized crystal for more than a decade, but he says the clothing he would sell was always from a third-party catalog.

The Allen's move to broaden the product base was smart given the competitive pressures in the promotional products industry, Bass says.

"There are a lot of people in this business," Bass says, so it can be dangerous to set too many limitations that someone else might step in and fill. He's already noticed in his own sales calls that selling customized embroidery done in-house rather than by someone else makes a difference.

For example, "when we'd go to an outside supplier we'd have certain minimum quantities we'd have to order. Now we can decide, if it's advisable, to do fewer shirts in a smaller order, so it gives us more flexibility," Bass says. "By the same token, Alpine is now in a better position with all the other kinds of items."

Hilda and Don Allen are a "mom and pop" -- just ask their two kids -- but they have never considered Alpine Graphic a mom-and-pop shop. A lot of people in the promotional business do think that way, Don says, and the mindset limits opportunities.

But the married entrepreneurs both come from a corporate background and keep their focus on growth and financial health, especially since the company was born in part because of the flameout of another, much larger business.

The idea to start the business came from Hilda, who had been a technical designer for Guilford Mills in the years before that textile firm began to fail nearly a decade ago. She liked the idea of custom embroidery as a business even while she still worked for the larger company -- but it became really important to her after she was caught in one of the waves of Guilford Mills layoffs around 2000.

Don kept his own corporate job but the couple began an urgent investigation into the embroidery business, which Don admits he knew next to nothing about himself. They would be tapping their own savings to get started, so they wanted to know all they could about markets, competition, expenses and a thousand other topics.

Big Step
One of the big early expenses was a single-head embroidery machine they bought for practice. Today, with shuttered textile mills dotting the Carolina landscape such machines can be found used for a song, but at that time the cost for a startup kit was still upwards of $25,000, Allen says.

It would have been difficult to tiptoe into the business with no clients to start with, but the Allens found an opportunity when they located an embroidery company based in Colorado that was looking to sell.

One of the main attractions of that particular business was its location in town of Penrose. They had no intention of relocating, but Penrose is right next door to Florence, Colo., and the Florence Federal Correctional Complex, home of the Supermax" federal prison and a number of other correctional facilities.

"This company had developed a Bureau of Prisons logo and embroidered all their employee apparel," Allen says. "They were on a first-name basis with all of those folks, and now we are, too. They were our first national client."

In 2003, Don, after a lot of number crunching and bracing for a diet of ramen noodles and peanut butter sandwiches, quit his six-figure corporate job to join Hilda at Alpine Graphic full-time. The prisons contract had moved with them back to the Triad, and much of the focus on new business was on local clients.

That's not easy business to win because there are a lot of potential sources of embroidered apparel, especially in the Internet age. Allen said Alpine focused on providing top-quality merchandise and getting samples into the hands of clients so they could feel a fabric and a stitch, not just see it in a catalog or on a computer screen.

Branching out
That approach won over clients such as Chris Edwards, president of High Point-based A Cleaner World, a chain of 41 dry cleaning shops in North Carolina and Virginia.

The Allens won A Cleaner World as a customer shortly after they founded Alpine Graphic, and Edwards says part of the reason was that their backgrounds in textiles and apparel was evident in their understanding of the products they were selling.

"But really, Don's just gone the extra mile," Edwards says. "We want our employees to look sharp and we're not focused on getting the cheapest golf shirts or the cheapest uniforms. We want shirts that will be durable and made of pre-shrunk cotton and comfortable, and he's gone a lot of extra miles to find what we need."

The promotional products segments Alpine Graphic has just added should be a significant boost for the company, but Allen has plans for pushing another avenue of growth: more national franchise accounts.

Right now, Alpine Graphic has just one franchise customer, the California-based printer cartridge refill chain Cartridge World with its 1,400 locations worldwide, but it's a very valuable client, Allen says. When a franchisee needs Cartridge World clothing for staff or promotions or any other reason, they can go to Alpine Graphic as the official supplier and get volume discounts on products stitched and shipped from High Point.

That's great business, but with only one such account, a significant share of revenue becomes tied to the fortunes of that business -- not an ideal situation, especially in a down economy. Allen says he's concentrating efforts to add more national franchises -- he's close on one, he says, but not yet able to reveal it.

The economy is the big question in Allen's mind right now. Promotional items are good advertising, he's sure, but they may be on some businesses' "optional" list if advertising budgets get tight.

"We've been fortunate so far, that most of our regular clients are continuing to work with us," Allen says. "We haven't seen a significant downturn."

Company Profile
Name: Alpine Graphic Apparel
Address: 2640-116 Willard Dairy Road, High Point 27265
Phone: (336) 884-6035
Web site: www.alpinegraphicapparel.com
No. of employees: Nine
Year established: 2000
Biggest problem: Cash flow, especially during startup
Solution: Half of the husband-wife entrepreneurial team kept a well-paying corporate job during the company's first years before joining full-time, and they continue to keep tight control of expenses.

Who's in Charge
Name/Title: Don Allen, president
Education: B.S. degrees in textile chemistry and textile engineering from N.C. State University
Best business decision: Joining the firm full-time once finances would allow it
Goal yet to be achieved: Adding additional national franchise accounts
Family: Wife and business partner Hilda, two grown children
Hobbies: Photography

Reach Matt Evans at (336) 370-2916 or mlevans@bizjournals.com

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