illustration by Alicia Traveria
Crafting a Business with Jenny Hart
Fighting the business boogeyman
By Jenny Hart
Published: March 11th, 2008 | 8:55am
This month’s column is a companion to “Tales of Terror: DIY Dames Share Their Woes and Warnings” in Venus Zine’s spring 2008 issue. Jenny Hart shares one of her “horror stories” here.
We’ve all heard them, tales of horror and woe for small businesses and designers who find themselves fighting (or running and screaming from) business boogeymen who’ve come to steal your soul-felt creations with their unscrupulous, bottom-line hearts. While the shades of being “ripped off” come in many variations of gray, some are as plain as black and white. There are a million and one ways your business can be taken advantage of, and theft of intellectual property is only one of them. Since launching my company, I could tell you horror stories from all angles of running a business that would turn your hair white. From bad hires, to bad advisers (and nasty tax surprises) to dubious “businesspeople” in sheep’s clothing, it’s worth it for you to be aware of what’s lurking out there. I only have time to tell you one for now, so get under the covers and I’ll tell you a tale …
One thing I’d like to say before I turn the flashlight on under my chin and get all spooky on you: This column is an anecdote where I don’t have magic advice for how to prevent such a thing from happening. Therein lies my advice to you this month: There are unscrupulous souls out there. You may not be able to avoid them despite your best efforts, so we have to learn from them the next time someone else tries the same old tricks. The best you can do is be ready for them the next time they come around, or send the message that they shouldn’t even try in the first place.
Business boogeymen come in all shapes and sizes, some little, some big. Let me tell you the time (cue flashlight under chin) I worked with a major craft manufacturing corporation. We’ll call the company Argyle (not its real name). I was asked to design and license a series of embroidery kits and patterns under my company’s name. Working with Argyle was something I had to consider very carefully and seriously. It was not something I blindly leapt at, clapping my hands with joy. How would this impact smaller businesses that carry my product? How could this help my company? Would my customers and fans think I was doing it to sell out? Would the quality of my product be maintained? Are they paying me enough to hand over this work?
The answers to these questions would turn out to be: negatively; bigger market; possibly; unknown at the time (no); and hardly.
This was also happening at a time when I was just starting to see suspicious knockoff all-in-one embroidery kits from the largest manufacturers apparently seeing my goods at trade and online. Which was hardly wild fantasizing on my part. I had been representing my company at trade, my kits were regularly featured in national magazines, and more tellingly, craft trade publications. For five months in a row, I was interviewed by a trade magazine (not available to the public) that profiled my work and asked me constantly to give advice on how to improve the embroidery market and sell to the “next generation.” I gave my advice sparingly, but I knew they had found me, and not in a good way. But Argyle seemed different. They wanted me to represent my own work through them instead of them just re-working ideas already out there. Argyle told me they’d been “watching my Web site for two years,” and even though I was excited about the possibilities, a little chill went down my spine.
Unlike these faceless big companies doing cheesy imitations of my work, I respected that Argyle wanted to bring an independent designer on the merits of their work, which I took as a sign of a good company. But just as much, I also feared that if I didn’t work with them, they might just rip me off anyway. It felt like an “if-you-can’t-beat-em-join-em” decision.
I was flown to Argyle’s headquarters and met with staff and their most senior people for hours. We had signed confidentiality contracts so we could freely share ideas in a daylong meeting with the understanding these ideas were not to leave the room or be used for anything other than the work I would do with them. They previewed their upcoming product lines for me, and then we spent more than a month carefully negotiating the contract.
After we agreed to move forward, I began working with a small team of people, the most important of whom were in my initial meeting, who would make the line happen, in manufacturing terms, while I did what I’d always dreamed of: nothing but the creative part.
What I was unaware of was that the main person I was working with on color choices, design concepts, and basically, all creative aspects was one of their in-house designers. I was never told this person was a staff designer, which is a very big no-no. Had I known this, I never would have agreed to work with that person or share creative ideas with him (as I did for weeks and months). In-house staff designers are generally not an independent designer’s friend. They’ve earned a deserved reputation for plucking ideas from independent designers to churn out as their own ideas for the company that’s cutting their paycheck. Of course, there are countless talented and ethical designers staffed by companies that come by their talents honestly and keep major brands unique and lively with their often anonymously produced, creative contributions. We’re just talking about the bad apples that have spoiled many a small-business cart here.
Months later, my line with Argyle debuted at a very large trade show. This is a show not open to the public, where retailers can view product samples and place orders for their stores. It’s also a place where competitors’ spies may look at your goods and might produce knockoffs or try to steal samples. When I arrived at Argyle’s booth, excited to see my line in person and be the smiling face endorsing it, I was stunned by how poorly my line had been executed. I immediately recognized that it didn’t reflect my input or the work I had been told was done. I was crestfallen. And confused — this company successfully produced licensed lines of other designers — so why was mine so horribly bungled? The samples looked bad, the packaging was unfinished, but I had to hide my disappointment and smile for buyers. Then it got worse.
On the second day of the show, I discovered samples that the company’s reps seemed to be hiding from me, of “hip” stitching embroidery kits. They weren’t on display like the others were. (Remember, my initial meeting with them included a preview of all their upcoming lines, and this one was never shown to me.) As soon as I saw them, I asked who designed them, because the work was so similar to my own, and I wasn’t aware of any other embroidery designers doing what I do. And clearly, far more time and effort had gone into this mystery line. And, hey, wasn’t that an idea I shared in our meeting? Who made these?
After witnessing my discovery of the samples, the head of my team scrambled over and, in a laugh-it-off kind of way, said the kits were made by the person on my team. I couldn’t believe it. It was coming together and falling apart all at the same time. I was furious and panicking inside. I found a way to say that I was not OK with this. But I was told with nervous reassurances that “these won’t even go into manufacture” and “we don’t even want this person spending time doing this! They’re supposed to be working on your line!” Translation: We’re blowing off your line and putting your concept into a company line under a staff designer’s name so we won’t have to pay you and thus make more money for the company.
A few months later, the other line was released. My kits had languished in unfinished production, key members of my team had started leaving Argyle, and I was left twisting in the wind with unanswered e-mails from the company and phone meetings resulting in someone’s voicemail. I refocused my time and efforts on my own company, Sublime Stitching. I had lost a lot of time and energy sorely needed there. I just wanted to forget I’d ever worked with this company. But things were about to take another unexpected turn.
Argyle moved forward to produce my kits without my further involvement or approval. I was shocked when samples were suddenly sent to me. I held in my hands a product line that turned out to be slapped together with cheap materials, transfers that didn’t transfer, bad graphics, and spelling mistakes throughout the instructions. Agreed layouts, wording, and packaging had been ignored. Now I really panicked — at the thought of these kits appearing in stores with my name, my face and the company’s mistakes and misdeeds all over them.
I had worked more than a year to make this line happen, trying my best to ensure the quality and protect the good name of my company. This could destroy all of that! I called the most senior contact I had at the company and told her we had a problem. And then I did the only thing I could do: I explained that I wouldn’t endorse the kits or sell them myself and wouldn’t be at the next trade show to help promote them. I also made it clear that I felt I had been deliberately misled while they produced a competing product, and so long as they continued with it, our relationship would end.
After some firm conversations, they agreed to pull and destroy all the inventory, which meant a sickening amount of money had been wasted. Down the toilet. Bye-bye. Money that my little company could only dream of having to invest in its own growth with quality product.
I walked away and discussed pursuing legal action against Argyle with my lawyer, who agreed there was a strong case for being defrauded. But I made the wrenchingly difficult decision to move on and not waste further time (and money) pursuing legal action. Which, unfortunately, many companies count on. So why not go after them? Well, I have pursued legal action against companies before, those manufacturers making use of my work without permission, mostly on clothing lines. But this was one I had to move on from, because I realized that even if I “won,” I’d still be losing.
Wait, did I hear someone say …
“Eh, it’s just a part of business.”
“It’d be cool if a large company ripped me off, then I could sue.”
“Getting ripped off can be a good thing! Exposure!”
No, dear reader, it is never a good thing. If you have to sue someone, you’ve already lost time, money, and initial market exposure. And while it’s true that you can’t stop someone from ripping you off, you can and should work to avoid it (see next column). I’ve been surprised to encounter many artists and designers who somehow got the idea that it would be good for their careers to get ripped off. Hoo boy. It simply doesn’t work that way.
So what soothing words can I offer you if your ideas are ripe for picking as soon as you put them out there? Well, it’s a toughie for sure. But there is something that will protect you better than contracts, copyright, and trademark: loyal, happy customers. When growing your company and establishing a reputation and name for yourself, this above all, will be your best and most valuable protection. Loyal, aware, happy customers cannot be bought or sold.
I wanted to share this story to let people know that this sort of thing really does happen and that I lived through it. I don’t consider this the worst thing that’s happened to my business, either. Now, I don’t want to say that large manufacturers are patently bad, and my advice to you is not to avoid working with them. It’s to be very smart and very careful about it when and if you’re approached.
The most important thing was to have carefully negotiated the contract in the first place so I could easily get out of it and not be obligated to Argyle in the future in any way. The situation could have been much, much worse had I not carefully negotiated the terms before anything went wrong and refused to sign it before we detailed only what work the contract encompassed (an initial contract covered a wide swath of my intellectual property, including all future designs). I learned a lot from this experience and am really glad it’s far behind me.
A lot of small businesses and designers dream of having a large company come along, like a knight in shining armor and make them bigger or take over their manufacturing and “get them into the big stores.” But it really doesn’t work that way, especially if you have an identity and level of quality you don’t want to see undergo drastic changes. It’s far more complicated and risky. This experience only caused me to re-double my efforts of independent growth, which have been far more successful and definitely more gratifying.
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This is the fifth installment of Jenny Hart’s “Crafting a Business” column. Send your questions to askjenny [at] sublimestitching.com. View additional "Crafting a Business" columns here.
Want more tips on how to run a DIY business? The spring 2008 issue of Venus Zine features a special section with tricks of the trade. Subscribe to Venus Zine here.
Issue #29
Comments
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craftopus (2 months)
So eloquently put! What wealth 'Argyle' could have had with such a fabulous line. It's a terrible shame that a company I once dearly respected could be so conniving. Thank you for the advice.
annab (2 months)
A great story that everyone who has a small business should read! I was approached by a very big toy manufacturer to design an item for their craft range. As well as being offered a pathetic amount of money for doing it there were other horrible implications. After initial talks I ran a mile!
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