Great Ideas for your Small Business: Become an Exclusive Importer
Sometimes being the first to introduce a product to the United States is the best way to establish a successful small business. This was the case for Mara Seibert and Lenore Rice, two former high-powered Wall Street players who traded in their briefcases for a new life that includes a New Jersey ware- house full of handmade Italian terra-cotta pottery.
Mara Seibert was on the fast track as a mergers and acquisitions specialist at Chase Manhattan Bank, structuring big leveraged buyouts and hostile corporate takeovers during the 1980s.
Tax attorney Lenore Rice was also on Wall Street during the takeover mania. She was on a partnership track at Shearman & Stirling, a tony law firm. But tired of the rat race and lucky enough to have wealthy husbands, Seibert and Rice decided to quit their jobs to stay home with their young children.
Seibert spent her free time collecting ceramic art and remodeling her home and garden. Rice studied Italian. They became close friends after Rice rented an Italian villa in Tuscany and offered the Seiberts a chance to share the house and expenses with them.
Bored one day when their husbands left to play tennis, the two women wandered into the tiny village of Impruneta to look around. They were immediately dazzled by the town’s deep orangey-pink and white-tinged pottery. They began selecting pots to buy for their yards and dragged their husbands into the village to look at the merchandise.
When their husbands agreed the pots were beautiful and durable, they called customs brokers to figure out whether it was feasible to buy a pallet full of pots. Thinking if they couldn’t sell them, they would keep them, they spent $3,000 on pots and another $1,000 to ship them by boat to New Jersey.
They began showing the pots and planters to landscape designers and upscale nurseries. It was an immediate hit, and the pottery, which retails from $35 for a small pot to $1,200 for a tree-sized planter, spawned a very successful business.
They invested $5,000 on a high-quality brochure and sold $20,000 their first year in business. Sales reached close to a million three years later. That fateful vacation in the tiny village of Impruneta, Italy, about two hours south of Florence, inspired Seibert and Rice to open a company bearing their names. One big secret of their success was signing exclusive import agreements with four families, giving them the sole U.S. distributorship for Impruneta pottery.
They are so worried about others wooing their suppliers, they won’t reveal the last names of their potters. They visit the artists once or twice a year to place more orders and monitor quality.
The business, which started with about $50,000 in inventory, began in the upstairs bedroom of Seibert’s home. They now store and ship the pottery from a warehouse in Short Hills, New Jersey, minimizing breakage with a special foam- making system that protects the pottery. Although you can buy terra-cotta garden pots from many sources, the company still appears to have a lock on the unique pottery made by Impruneta’s craftsmen.
Tips for becoming an exclusive importer
AN EXCLUSIVE IMPORTING relationship is one based in trust. You have to trust the people you are working with to sell only to your company, and they have to trust you to make every effort to sell their products in the United States, or wherever you agree to market their products.
To help establish a trustworthy arrangement:
- Make sure they don’t have any existing relationships with other companies.
- Hire an interpreter to help you negotiate the agreement.
- Work with a local attorney to draft an agreement in their language and make sure you understand the terms and aren’t breaking any local or national laws.
- Start with a short-term deal to see if things are working out for both parties.
- Find a reputable customs broker to handle the shipment of goods from the manufacturer to your warehouse.
- Set up a system to account for all sales and shipping information and communicate with your supplier on a regular basis.