Spanning the Globe

HOW DID YOU BREAK INTO THE CATALOG BUSINESS: Two words: world travel. Working as a business consultant and traveling all over the U.S. in the 1980s, Stopka earned plenty of frequent flyer miles to take annual vacations in Europe, where he fell in love with European culture.

“I told my wife [Design Toscano co-owner Marilyn Stopka] I could market European exotic products to the American public,” Stopka says. By sourcing through a friend in the statuary business, Stopka began selling his products through a new catalog. “We took its catalog, replaced the cover, put a price sheet in and advertised in the back of magazines.”

Four years later, “I still was doing my ‘day job,’” Stopka recalls. “In the evening we’d do the business logistics. We hired a local art gallery to be the phone center and drop-shipped everything from the statuary company. When we got up to about $4 million in sales, I told my wife, ‘It’s time for me to quit my day job and run Toscano full-time.’”

BIGGEST INITIAL CHALLENGE: Money. “I started and ran the business for years with no cash,” Stopka says. “I literally used the credit from the vendors for advertising. I had to use the printer’s credit to grow the business. The bank won’t give you a $2 million credit line until you make money and have some assets.”

HOW HE OVERCAME THIS CHALLENGE: A strict adherence to the balance sheet. “We had to work the balance sheet; show the bank we were worthy of credit,” Stopka says. With financial backing secured, he was able to market Design Toscano’s unique product line and establish a niche audience, starting the business with $6,000 and growing it to $30 million in sales.

WHAT SETS YOUR COMPANY APART FROM THE OTHERS: Product exclusivity. As one of very few American catalogers to expand overseas, notably into Asia, Design Toscano directly taps the sources for all of its historical replicas, such as French tapestries, Egyptian decor and Asian statues.

More than 90 percent of what Design Toscano sells is exclusive. “Selling exclusives gives you strong margins,” Stopka says. “That gives you control over your pricing and discounting.”

WHAT’S THE KEY TO STOPKA’S AND THE COMPANY’S SUCCESS: Working 24/7, understanding your niche. “My analytical and system skills helped in this industry,” he notes. Design Toscano serves a niche audience, and he believes staying true to its core audience and brand has served the company well.

“Many companies veer too far from their niche; they lose what they’re good at,” Stopka says. “Some say, ‘Why not grow to $100 million in sales?’ I say, ‘You can’t. This is the size niche that we’re at.’ You can define the niche differently. If it weren’t a niche business, it would be a brick-and-mortar retail chain. But it’s not. You’re looking for niches in cataloging — and now the Internet.”

For the full interview, see the CatalogSuccess.com exclusive: A Chat with Mike Stopka.