Make or break

By MATT WICKENHEISER, Portland Press Herald Writer
Staff photo by Gregory Rec

Theresa Roelke reads her book, "A Pouch for Kip,"
to children at Borders in South Portland. Lily August-
Brown, 7, and Megan Yudaken, 5, both of
Scarborough,are ensconced in Kip Sacs, which Roelke
created and sells.

Next to the colorful wooden blocks, to the left of the
Dream Collection line of dolls, under the Magic ball
(The Most Playful Ball in the World!) sits a stack of
threeKip Sacs.

Dark blue fabric shows through clear-plastic packages,
each printed with the picture of a boy and girl snuggled
into what must be Kip Sacs. The sacks, piled here in the
bottom floor of Northern Sky Toyz in Portland, are
part of the annual consumer whirlwind that began this
weekend one of a thousand products the store offers for
sale.

But the sacks are much more than mere products to
Theresa Roelke of Scarborough. They are Roelke's
holiday dream.

Shoppers who browse Kip Sacs at Northern Sky Toyz, or REI, or Rugged Bear, won't know about the four years that Roelke invested in getting them to store shelves. They won't appreciate the obstacles she's overcome, or how she's evolved as a person while navigating the unfamiliar world of international manufacturing and selling.

The shoppers won't understand just how crucial they will be this holiday season in validating Roelke's effort. If consumers buy Kip Sacs during the next few weeks, Roelke will be able to grow her dream business. If not, four years of hard work, personal growth and expectation will end.

"This is sort of make or break for me. If it doesn't go anywhere, that's it," says Roelke. "Everybody keeps saying to me, 'It's going to sell, it's going to sell,' but I don't know that it's going sell."

The annual question of whether consumers will buy this gift or that - and how much they will spend overall - hangs over thousands of retailers, distributors and small manufacturers each holiday season. The 2003 group of expectant entrepreneurs began to receive an answer this weekend, with the formal kickoff of the nation's 26-day shopping spree - a period that will see an estimated $217 billion in retail spending and that consumer-product companies rely on for 50 percent to 60 percent of their sales.

Almost everyone participates in the annual buying binge, but few shoppers understand the personal struggles that lie behind many of the products they choose to buy or set back down. To reveal that hidden side of the season, the Portland Press Herald/Maine Sunday Telegram spent several months checking in with Roelke to chronicle one woman's entrepreneurial adventure.

Story of baby kangaroo

Her journey began in 1998 with a craft project that she worked on in the living room with her two kids. That project has grown into a commercial enterprise, with a production run of 2,000 Kip Sac sets being sold in stores nationwide this December and another 1,000 on the way.

Roelke has gone from being the woman who spent a summer in Calcutta working at Mother Teresa's orphanage to the businesswoman who outsourced textile manufacturing to China. Roelke is the mom who bakes banana bread in the morning for 12-year-old Kate and 10-year-old Stuart, as well as the entrepreneur who deals with New York Customs agents in the afternoon, clearing up international import problems over the telephone.

She is the former teacher who tutored small groups of at-risk kids and now hopes to reach thousands of children with the book she has written and illustrated - the story of a lost baby kangaroo, named Kip, and the fabric sacks that a boy and girl made to keep him safe and warm. Each of her sacks comes with a book in its pocket.

Roelke has become the entrepreneur who developed a Web site and the businesswoman who attracted interest in orders next year from Filene's, JC Penney and L.L. Bean - if the sacks sell well in 2003.

Ironically, Roelke's entrepreneurial journey started from her disenchantment with the whole holiday rigmarole.

Roelke came up with the idea of a lounging sack when Kate and Stuart outgrew their favorite blankets. They loved being able to crawl inside the sacks. "I mainly did it because it was a cuddly, fun idea," she said.

That Christmas, while shopping for her eight nieces and nephews, she became discouraged by the commercial rush and the rudeness of fellow shoppers. She returned home and made eight of the sacks, shipping them to her brother's house in Rhode Island. They were a holiday success, and her sister Margaret urged her to consider making more sacks to sell.

Roelke had always thought she'd return to full-time teaching when her children got older, but her sister's suggestion laid a different path before her. She began a small craft-based business, sewed several of the sacks and tried to sell them in shops around the Michigan town where she lived. She took the kids in tow as she visited store owners.

She moved to Maine when her husband, Ron, took a job here. But she continued to work on her project, off and on.

Two words: 'Do it'

Roelke developed a storybook to go with the sacks and, in 2002, decided to commercialize her small business. A teacher at heart, Roelke hoped to make reading books a fun, cuddly experience for a lot of children.

Instead of making a few dozen Kip Sacs for each holiday season, as she had done, she would scale up production and produce a few thousand. Contracting out production to a textile company would allow her to bring the price down through volume manufacturing.

In 2002, she met with Edward Tong, owner of Ricobest, a Hong Kong textile company with a sales office in Portsmouth, N.H. He galvanized her with two words: "Do it."

"He gave me the mental mind-set to move forward," Roelke said. "He wasn't saying it was going to be easy, he just said, 'Do it.' "

Doing it, however, required a lot of on-the-fly learning. She entered a business world that has its own rules, structure and culture. At first, she didn't know where to start.

But dealing with catalog deadlines and customer purchase orders soon made the tasks clear.

"It's like waiting to have a baby - you're walking around imagining life," she said. "When the baby comes, it's absolutely clear what you have to do. You don't have to dream about changing diapers, you're in it."

Learning experience

One of the first challenges she faced, early in 2003, was lining up retailers. Roelke started to court buyers from billion-dollar companies such as Filene's, L.L. Bean and JC Penney. She attracted some tentative interest from HearthSong and REI early, but had to keep the pressure on them until she received purchase orders.

She quickly learned that her enthusiasm and ideals weren't enough to close contracts.

"I always have to think about what the other guy's going to get out of it before I think about what I get out of it," she explained. "It's always, 'I can make you money.' I hate it, but that's the game.

"As soon as I understood that, it became easy."

After getting several firm orders, Roelke turned her attention to redesigning the sacks for manufacture in China. She drew up - and revised several times - specification sheets until Ricobest had the information it needed.

Then, she worked with a Hong Kong designer to create a fabric pattern that is based on an illustration in her book. Her husband, Ron, suggested putting the kangaroos on the fabric in a random rather than in-line pattern, so that if things didn't work out, the material could be used for something else - socks, mittens, clothes.

She tracked down a printing company in Shanghai and signed a contract for the production of thousands of copies of her book, "A Pouch for Kip." She also started working on the sequel, "Rescuing Frangipani," so that if the 2003 season went well, she would have a follow-up for the 2004 holidays.

As the shipping date approached, Roelke found that she needed to manage the process personally, even though she was thousands of miles away from the factories, sitting in her Scarborough kitchen.

She had hoped to have the 3,000 packages of books and sacks out of China by late August, but the printer missed its deadline for getting the books to Ricobest.

A woman in charge of the project at Regal Printing in China was out sick for several days and couldn't respond to Roelke's e-mailed concerns.

Roelke learned always to include a company's owner on any e-mail. She also discovered that, in business, time lines can be fluid, with built-in deadline padding and must-have dates that shift.

"When you say a day or two, it translates to more, and everything is contingent on everything else," she said.

She pushed the printer, who shipped books to Ricobest as they came off the presses, rather than at the end of the press run.

Roelke had promised HearthSong and REI that they'd get the product by a certain date, and the deadline loomed particularly large with HearthSong. Its holiday catalogs, with Kip Sacs featured in the color glossy pages, had an Oct. 25 mailing date.

By Sept. 10, Roelke began to worry that she'd miss her promised delivery date. The sacks had not yet left for their 27-day ocean voyage to Portsmouth, N.H.

"To be honest, I really don't know" that they'll arrive in time to meet my obligations, Roelke said at the time. "I'm freaking out."

Greasing the skids

The problem turned out to be a U.S. Customs issue: Ricobest's American arm, Echo Mills, had tried to classify the product under one import code, and it was supposed to be listed under three - pillow, book and blanket.

"What it basically comes down to is taxes - how much money can we get out of the product," Roelke said.

To grease the skids, Roelke called Customs in New York, obtained a signed copy of a ruling letter that specified the duty and shipped the document to China electronically, so the product could move, she said. "I didn't know about a ruling letter, but I sure do now."

Getting the letter was not her responsibility, it was the manufacturer's. But she knew by now that if she didn't work out the problem, her product might miss the 2003 holidays. And if she missed the all-important gift season, few retailers would give her another chance in 2004.

Roelke dealt with the stress by working through it, something she learned from having eight siblings. From an early age, she'd understood how to deal with problems and reach compromises.

"This is your situation; work it out," she said. "It's not like it's going to go away."

In early October, the ship had left China, and for several weeks each morning, while shampooing her hair in the shower, Roelke's mind swirled with "what ifs?"

What if the product, which she hadn't seen yet, wasn't quite right? What if weather problems delayed the ship? What if it sank?

"I'd cry," Roelke said at the time. "I think I would move on. Yeah, it'd be a total bummer, but you move on in life."

Roelke stayed busy by working on her new Web site. A friend in Seattle did a lot of the technical work, but Roelke had to put everything together for him. Already, she'd learned a variety of computer programs, from spreadsheets and business-accounting programs to digital-photography-editing and Web-site-production software.

"That's my storefront. I want them to really get a sense of my product; all that I put into my product has to be conveyed," she said. She hadn't anticipated just how hard this task would be, though, and she was grateful just then for her product's long ocean voyage.

"Good - keep it on the water until I get my act together here," Roelke said. "Just don't sink the boat."

The boat didn't sink; the shipment arrived; it became stuck with Customs in Worcester, Mass.

"I freaked. I knew I had already delayed this product twice, to HearthSong and REI," Roelke said. "I basically said to Echo Mills, 'This isn't an option, I'm not going back to them again.' They said there's nothing they could do."

Focused on the goal

On Oct. 17, nearly two months after Roelke had hoped to take delivery of the sacks, she found herself four days behind the revised shipping date she'd promised her most important customers.

Late on that Friday night, Roelke called a contact she had made with Customs in New York, and on Monday morning, he started making calls to Worcester, trying to find out what had happened.

"I don't think this is common. I think he rarely does this sort of thing, to be honest," Roelke said.

The agent discovered that Echo Mills' shipping broker, a middle man, didn't have a copy of the ruling letter Roelke had secured weeks earlier.

"I was pretty angry. I hate to point fingers, but I have a lot to lose; this is a big deal for me," she said. "But I focused on the goal - to get this (product) into the country. You can't lose sight of what you're trying to accomplish."

The Customs agent sent a copy of the ruling letter to Worcester, and the sacks were released. The next day, Roelke found herself in Echo Mills' Portsmouth warehouse, searching among stacks of boxes that were bound for retailers like Eastern Mountain Sports and L.L. Bean, when she spotted the words "Kip Sacs" on some containers.

"All of a sudden, I remembered Kate and Stuart sitting on the living room floor, cutting fabric," Roelke said. "I thought, 'Wow, you've come a long way.' At that point, I felt like I actually succeeded. I struggled, but I figured it out."

Kip Sacs are now on shelves across the country, retailing between $50 and $60 at stores like REI, The Rugged Bear, Sturbridge Yankee Workshop and the Samoset Resort gift shop in Rockland. The Web site, www.kipsacs.com, is up and running, complete with customer testimonials, a frequently asked questions page and background information. The sacks have sold out once already at several regional and local stores, including Northern Sky Toyz in Portland, where the store manager has ordered more.

Roelke continues to push the sacks. She realizes that her story is a big part of what will sell the Kip Sacs and is working to have it told in local media and by speaking to area groups. She's holding store events, like one at the South Portland Borders earlier this month, where she read her book to a group of children. She's already recouped her investment; she initially paid for the manufacturing at Ricobest with the help of loans from family and has since sold her sacks to the retailers carrying them.

In a few months, she'll know if all her work has been enough. If it wasn't, she'll find another path.

"If it doesn't sell, I know that I've absolutely given it my best shot, and I got to a point that a lot of people actually just dream about," Roelke said.

Reproduced with the permission of The Portland Press Herald Copyright © 2003 Blethen Maine Newspapers Inc.