The Stationers Guild

This week I attended a conference at the Javits Center National Gift Show entitled “Get Real . . . Green Verification and Certification.”  Like most responsible people (although my wife might disagree), I wish to use our planet’s resources wisely.  I had hoped that behaving “green” was as simple as plugging in a purchasing decision or behavior pattern into a carbon footprint calculator and voila:  pat yourself on the back for doing the right thing!  Little did I know how mistaken I was.

The Javits Center conference showed how difficult it is to verify “green” claims.  Three speakers from quite different backgrounds, but equally committed to the environment, shared their insights on how one might go about green verification and some of the pitfalls in this process.  I have broken down the Blog into three parts to summarize each speaker’s presentation and keep the article to manageable proportions.

Alan Honick, a documentary filmaker most of his life, traced the complexities of environmental sustainability by discussing his research on the controversy over the Northern Spotted Owl and logging in the northwest.  Clearly, there is far more to the subject than simply an endangered species.  He argues that all factors – including human – need to be taken into consideration when looking at environmental issues.  I had a chance to talk to Alan after the conference and he pointed me to the Forest Stewardship Council (FSC) for more information on this important subject.  He believes that the FSC does an excellent job in keeping the “human economy” in sync with natural ecology.  See Mr. Horick’s fascinating 10-part video in 9 minute segments entitled “Critical Habitat”:

Despite the somber tone of this excellent video, it captures the complexities of tinkering with mother nature and the difficulties in developing sustainability models that balance environmental, economic and social needs.  Out of countless interviews with advocacy groups and scientists, Mr. Honick featured 18 special-interest advocates and 15 scientists in the video to provide a balanced presentation of the issues involved.  I was most fascinated with the role of millipede which is responsible for processing 95% of the organic matter in the forest.  As Mr. Honick correctly points out, the Northern Spotted Owl was just a side-show for a very complex problem.

Being the stylish person that he is, Prentiss Douthit has an aversion to capital letters.  Out of respect to him and his talented craftspeople we will refer to prentiss douthit as “pd”.   We met Prentiss several years ago at the National Stationery Show and he continues to be one of the most engaging and throughful people in the stationery industry.

pd’s stationery and invitations are refined, clean and tasteful.  Despite their apparent simplicity and subtle use of colors, pd’s stationery is quite original and easily recognizable.  Furthermore, we have found pd to be attractively priced and great value for those looking for distinctive correspondence.

Now through February 28th, all custom stationery is on sale at pd.  See 14 new designs at a Guild member stores in your neighborhood and order your personalized stationery before the end of Februrary and get a free return address printed on the envelope:  No minimum quantity!

The recent bankruptcy of Blue Tulip has prompted Connecticut Attorney General Richard Blumenthal to warn consumers to redeem gift cards before they become worthless at the end of this month.  While the bankruptcy is no doubt a traumatic experience to most Blue Tulip employees, it does raise some interesting questions about the value of gift cards.

At Therese Saint Clair, we have always resisted promoting gift cards.  In effect, it constitutes an interest-free loan to the store for merchandise that may be purchased in the future.  Processing companies that promote gift cards will tell you that on average between 8% and 10% of the face value of gift cards will not be redeemed.  While this might be considered a “good deal” for the card issuer, it does seem rather unfair to the consumer.  One way stores can redistribute these “unredeemed dollars” is to sell gift cards at a discount.  For instance, if on average 10% of gift card sales go unredeemed, a store can redistribute those dollars to their gift card holders by selling a $100 gift card for $90.  Personally, I think that this is only the fair thing to do.

More importantly, I fail to see the appeal of single-store gift cards.  Isn’t just another piece of plastic?  With already over-crowded purses and wallets, why do we need another payment option?  While promotional gift cards to encourage town residents to shop locally might hold some appeal, the single store gift card seems to me to a rather silly payment alternative.

Sheila May
Therese Saint Clair

The Boston Hearld reported that Blue Tulip filed for bankruptcy protection on January 5, 2009.  Highland Capital Partners is reported to own 44% of the New Jersey-based company, which operated about two dozen gifts stores in the northeast and employed 400.  Highland’s investment in Blue Tulip was apparently the brain-child of Tom Stemberg, the former CEO of Staples and now a General Partner at Highland Partners.

Three years ago, I remember listening to Mr. Stemberg describe on CNBC how Blue Tulip was going to reenergize the stationery and gift boutique industry by building a series of template-based model stores staffed by well-trained professionals.  As an experieced stationer I couldn’t imagine how the “Staples-model” could be applied to our industry, but when someone of Mr. Stemberg’s stature is willing to risk the firm’s capital and that of its investors in a new venture it is wise to take notice.

While Highland Capital Partners will no doubt cite the recession and weak holiday sales as the primary factors behind the demise of Blue Tulip, I suspect it was a flawed business model.   As we have seen many times in our industry, investors believe that they can clone a successful store model and replicate that store or franchise it across a wide geography.  

The fatal flaw is that Mr. Stemberg and its investors cannot clone the management and entrepreneurship that made the model store so successful in the first place.    Blue Tulip, like most chain stores, is driven by product sales and not service.  You are either have a well differentiated brand for which you can charge a premium or you become the low-cost producer.  Blue Tulip’s products were no different than you would find in any gift store and it didn’t have the economies of scale to become the low-cost producer. 

In the case of fine stationery, independent store owners are the catalyst that provides the client with a meaningful shopping experience.  Entrepreneurship and service quality are the hallmarks of successful stationers.  These intangibles are practically impossible to replicate in a corporate model which is generally structured by-the-book and where most purchasing decisions are made by headquarters.  The spontaneity and creativity is removed from the equation and, as such, store managers will spend more time looking for corporate guidance than seeing how they can serve their clients more effectively.

I suspect that Blue Tulip is just the first of several chain stores in the stationery and gift industry that have discovered that their business models are seriously flawed and will need to take urgent action to right-the-boat.

Richard May
Founding Member