Mergers & Acquisitions

Selling a catalog business can be an emotional decision. Owners often have an inflated view of what their businesses are worth. So arriving at a realistic price tag can be difficult. The old adage “For every seller there’s a buyer” certainly holds true. But finding the right buyer for your business — someone willing to pay your asking price — isn’t always easy. While we at Lett Direct aren’t investment bankers or business brokers, I’ll share with you what we’ve learned during the years from working with catalog business owners wanting to sell their companies. Timing is Everything Knowing when to sell

Your direct selling expense ratio is as important to track as your cost-of-goods ratio and other key metrics on your income statement. Indeed, controlling your direct selling expense ratio plays a major role in helping to improve your catalog company’s profitability. This month, I’ll focus on ways you can reduce your direct selling expense ratio. But first, let’s look at what normally comprises direct selling expenses: - catalog creative costs; - printing and paper; - ink-jet addressing and mailing expenses; - bind-in order forms and envelopes; - postage; - outside list expenses; and - merge/purge costs. Direct selling expenses

The new Payment Card Industry (PCI) standards, which recently went into effect, are meant to help merchants beef up their data-security practices to better protect their customers’ credit card information — a commendable endeavor, indeed. But figuring out how to actually comply with the standards has left many merchants scratching their heads. Following are the answers to frequently asked questions about the standards. What is PCI? It’s a new, unified set of data-security standards from Visa, MasterCard, American Express and Discover card companies. Until this year, each card company had its own data-security standards. PCI, then, is a way for merchants to complete

Every business manager such as yourself must balance the need to cut costs vs. invest for growth. Which way the scale tips depends on several things, including the general state of the economy, political events, your own bottom line, and your company’s merchandising and operational strategies. As a business editor, I’ve noticed many articles published in the last few years touting cost-cutting measures. But as the economy rebounds, more and more attention is being paid to business investment for revenue growth. This month we offer articles for both camps. Our cover story examines the growth plans of gourmet food cataloger Mackenzie Limited.

Identity theft is one of the fastest-growing crimes in America, affecting hundreds of thousands of consumers every year. As an online merchant, you’re more susceptible than ever to being an unwitting accomplice to this crime by becoming the target of spoofing: a practice in which fraudsters emulate your Web site or e-mail, or otherwise represent themselves as your company. Moreover, by inadequately protecting your customers’ personally identifiable information (PII) and credit card numbers from cyber-thieves, you may be unknowingly contributing to the alarming rise in consumer identity theft in this country. In the following article, I’ll focus on ways you can reduce your chances

The last 20 months at L.L. Bean have confirmed one over-arching principle: Progress can be painful. Faced with stagnant sales, too much inventory and stale creative, Chris McCormick, CEO of L.L. Bean, had to make some difficult and unpopular decisions if he wanted to whip the company into fighting shape for the 21st century. He instituted numerous reorganizational initiatives that included eliminating 32 catalogs from the mail plan and 2,300 unproductive catalog pages. The staff cut 25 percent of its SKUs. Its vendor list was chopped in half after the company renegotiated nearly all major contracts, including printing, paper, e-mail fulfillment and data

You know that you must accept Visa and MasterCard; most catalogers wouldn’t be in business without them. And you know that credit card processing can be expensive, typically costing more than 2 percent of sales. But you probably don’t know if your payment processor is doing a good job, or if you’re getting value for your money. And what you don’t know might be hurting your business. But a little information goes a long way. This article will provide ways to evaluate a payment processor, and tips to help you understand your options and make sure you’re getting the biggest possible bang

If you want to succeed, you should strike out on new paths rather than travel the worn paths of accepted success. —John D. Rockefeller Building wealth by starting a catalog is the stuff of legends. The reality, as you know, is much different. Having inadequate financing from the start is a blueprint for failure. Yet, having adequate financing and deep pockets doesn’t guarantee your success either. Sure, cataloging is fun and exciting, and it can be rewarding. My intent is not to scare readers away from the prospect of starting a catalog from scratch. Rather, I want to make you

The most unlucky cataloger I ever knew was a food cataloger who watched helplessly in 1994 as its retail store in Northridge, CA, turned to rubble in a disastrous earthquake. A year later, the same cataloger was again forced to watch as its retail store in Japan literally slid into the ocean in the Kyoto earthquake. Next time you think the gods have singled out your catalog for special torment, remember this cataloger. Cataloging has seen its share of recent collapses and closures (e.g., Fingerhut, Springhill Nursery, Willis & Geiger, Balduccis). Several others have come right to the brink of disaster before

In this time of uncertainty, controlling your direct selling expenses is critical to your bottom line. Fortunately, paper prices have remained low, which helps offset the recent postage increase. But the business climate is difficult, and the squeeze on the bottom line is real. This month, I’ll offer various ways to reduce your direct selling expenses. Specifically, the following line-item expenses should be considered direct selling expenses: - catalog creative and production; - paper; - print manufacturing; - outside rented lists; - merge/purge; - bind-in order form insert; and - ink-jet and mailing. These direct selling expenses always should be grouped together