A Chat with April’s Profile, A.G. Russell and Goldie Russell, president and CEO, A.G. Russell Knives

© Profile of Success, Catalog Success magazine, April 2007
Interview by Matt Griffin

Catalog Success: When was the A.G. Russell catalog established?
Goldie Russell: The mail order company was started in 1964. He didn’t actually mail a catalog for a period of time. Mostly it was space ads. I don’t know when you printed the first catalog, but I imagine that wasn’t until the ‘70s.

A.G. Russell: Actually it was the late ‘60s. As soon as I had enough names to start mailing. You’d have to define catalog. I don’t know how it was defined in the late ‘60s, but I was mailing folded brochures, then later stapled.

Goldie: What we would call self-mailers today.

A.G.: I got into brochures pretty early. You do a color brochure with a letter, an order form and a return envelope. It’s totally different today.

CS: Where are your headquarters?
Goldie: We’re located in Rogers Arkansas. We’ve been located in northwest Arkansas since 1964. A.G. started the company out of his home there, then moved to Springdale, Ark., just down the road. Then in 2002, we moved into a new facility in what is now Rogers, just off the interstate. So we’re much more visible and accessible now.

CS: And your primary merchandise is knives?
A.G.: That was almost totally true until 1998. In 1997, we started a new catalog. The Christmas catalog of Russell’s for Men mailed in January of 1998. That’s a gift catalog for men.

Goldie: Has anyone sent you catalogs yet? I want to let you know that the Russell’s for Men Web site is not indicative of the catalog. The Web site needs work. It’s old. We rebuilt the A.G. Russell Web site two years ago, and had started work on the Russell’s for Men site when we lost the employee who was doing that. That site is a big project for this year.

CS: What’s your annual circ?
Goldie: About 5 million.

CS: And the number of SKUs?
Goldie: Actually in inventory, it’s about 3,000. Any given catalog carries about 300. But the Web site is much deeper.

CS: What are your primary customer demographics?
Goldie: Definitely male. Age 45 to 65. Strongly oriented towards hunting and shooting. What I like to call the rugged outdoors type. A.G. doesn’t like the word rugged. It’s that shooting, hunting traditional.

CS: What are your sales channels?
A.G.: About 30 percent on the Web. We do 11 knife catalogs per year. 5 to 6 Russell’s for Men catalogs. About 20 brochures per year. And 50 e-mail specials to 60,000 subscribers, so about once a week. That’s what we do during the year.

Goldie: We basically have three channels. We have the catalog sales, either phone or mail. And that was 63 percent last year. The Internet is about 30 percent, with the retail store onsite at about 7 percent.

CS: How many employees?
Goldie: About 45.

CS: How did the company get started?
A.G.: I returned to Arkansas from California. The movers somehow lost my Arkansas stone. The Arkansas stone is a mineral called novaculite and it’s found only in central Arkansas over into eastern Oklahoma. It’s on the surface, with very little soil on top, easy to access. This is a sharpening stone. From the early 1800s, Europeans first found this stone in 1820. The Native Americans were using it to make tools. It’s similar to flint, just in a much purer, easier to work form. The Europeans found that it would sharpen steel in a superior fashion. It was the premium sharpening stone until ceramics came along. Long story short, the movers lost it, and I had a hard time finding a replacement. Eventually it became so difficult to find, I went to the world’s source, in Hot Springs, Arkansas, and bought enough to put myself into the mail order business peddling whetstones. In addition to putting ads in the American Rifleman and other magazines, I went to local hardware stores, which had earlier refused to order three of them so I could buy one, and I sold them smaller stones to sell to their customers. One of these hardware stores told me about an importer who had been importing Swedish kitchen knives and German pocket knives who had died. I got in touch with his widow and bought their stock, so all of a sudden I was in the knife business as well as the whetstone business.

That was in 1964. I’m using spiral notebooks to keep track of my sales. I’m working at the kitchen table of my farmhouse, about 20 miles outside town. I had moved to Arkansas to raise my kids, and that’s what I was doing. I had a 200 acre farm with pigs and cows, everything but sheep, and four kids.

In the late ‘70s, I had trouble with depression, and my wife of 24 years decided I was a pretty boring fellow and changed her life and consequently mine and the marriage failed. A few years later, I met Goldie, who had an art background.

Goldie: During that period of time, the business nearly failed. But due to the loyalty of the customer base, he was able to recover. That recovery started in about 1984. By the time I came into the picture, it was pretty much back, in terms of gross sales, to where it had been.

A.G.: Between 1980 and 1984, it declined from my high of $998,000 to less than $250,000. But 1984 was the last down year. We’ve been up every year since then.

Goldie: I started in late 1988.

CS: Goldie, what did you do when you first came on?
Goldie: A.G. and I had just gotten married. I had a small service business and I was working very hard. He talked me into giving that up, with the idea being that with my art background, I would come in and build his catalogs and advertising campaigns. That was the first thing I did. He hadn’t produced a catalog in four years. My first responsibility then was getting the catalog built. That was a real learning experience. I had been a secondary school art teacher. I had no experience in business, no experience in building catalogs. But I did have training in terms of how things should look and how to design layouts. Very quickly I took over the management of the day-to-day activities, as well as the catalog. And we started growing.

CS: Now you say you dropped from nearly $1 million in 1980 to less than $250,000 in 1984.
A.G.: Actually it was ‘79. I dropped 40 percent in 1980 alone because I wasn’t working. And then in ‘81, ‘82, ‘83 it was the same thing. Then in ‘85, we grew and by ‘88 we were at $1 million again.

CS: And now the company is at about $15 million?
A.G.: Goldie can give better numbers, but yes.

CS: Goldie, as you took over the day-to-day operations, how did you grow the business from $1 million to $15 million?
Goldie: The thing that really made it happen was working as a team. We were able to accomplish a whole lot more. A.G. tends to be the creative force and I tend to be the organizational force. I’m very methodical, whereas he’s very impulsive. He had the knife background and the mailorder background. The way the roles have worked out is that he does knife designs. We’re not just a retailer. If you look at the A.G. Russell Web site, you’ll see a whole lot of knives on there have the A.G. Russell brand on them. So all along, through 43 years of history of being involved in the knife mail order business, he’s designed knives and had a real impact on what knives are being manufactured; he’s very involved in the hand-made knife side of the industry; and is very creative with the copy. If you read the copy we put in the magazine, it’s a lot like Crutchfield. So much of what they do is how they talk about and what they say about their product. And A.G. tends to do that also. He tells a story. He’s not just selling a product; he’s educating the customer. That works really well with the customer base we have, men who are interested in knives. My coming on allowed him to concentrate on that. I took over the business responsibilities. I took over the catalog production responsibilities. I edit all of his copy. I had a minor in English in college, so I have a little understanding of that. We have a lot of ideas. There always are more ideas than you can accomplish. And we just started hammering them out. And in 1996, we got to the point where we were concerned with how much more we could grow the knife side of the business, so we went looking for another opportunity. We wanted to stay in mail order because that’s what we knew. And so we decided to start Russell’s for Men, which is just a catalog of product that appeals to this male customer base that we have. It includes limited edition prints, luggage, walking sticks, kitchen knives, turkey fryers, all sorts of high-end quality products that appeal to those folks.

And one of the things we try to focus on is high-quality, classic sorts of products. We seem to gravitate toward American companies that are small and unique. We deal with several companies that are family-owned, even after 100 years. The Gershner chest, for example, is one of those items. That company has been around since 1906.

A.G.: You understand that these small American companies, once they’re successful, they very quickly move their source of goods to China. Gershner has two lines, an American line and Chinese goods. And that’s not to say we don’t sell Chinese goods, we do. The gift catalog couldn’t exist without it. That’s where everything is made today.

Goldie: I think the focus is on high-quality, as hand-made oriented as we can get it, as exclusive as we can get it. Certainly stuff that appeals to this hunting, shooting, outdoor-oriented male.

CS: What were some of the biggest challenges you’ve faced in growing the business?
A.G.: For the past 15 years, the biggest problem is finding competent people. We have a great staff. But for 15 years, the economy in this area has been so hot, that it’s just really difficult to find good people.

Goldie: Walmart’s general headquarters are located about 15 miles down the road.

A.G.: That has an impact. Other large companies and a few thousand of their vendors are located here as well.

Goldie: We have offices here for Procter & Gamble, Johnson & Johnson, and on and on. Because of Walmart.

A.G.: And that brings us to today, where the local economy and the local labor has nothing to do with our problem. We need a merchant. And you know what that is, but if I talk to my banker, he thinks that’s someone with a store. My accountant thinks the same way. So we’re looking to the greater world to find a merchant. And we also need a marketing manager to build the catalogs. Goldie’s working 60-70 hours a week doing those two jobs, as well as running the company.

Goldie: That leads to one of the biggest challenges over the years. It’s not so much a problem anymore, but for most of the history of the company, trying to educate the bankers, the accountants, the lawyers about mail order was tough. Because there’s no other mail order companies around here, they didn’t understand it. There’s one other company here, but they produce jams and jellies. But that’s the only one, and they’ve been low key. That’s been a challenge over the years. We’ve been relatively successful recently, and as you become more successful, these folks become more comfortable dealing with you. And because the economy and the area has grown so much with this influx of Walmart vendors, we’re a much more sophisticated area than we used to be. There’s more understanding here than there was 15 years ago. So that challenge isn’t what it used to be.

I think the greatest challenge today is a succession plan.