MY DEMPSEY & CARROLL STORY

I founded The Chelsea Paper Company in January of 2000, chelseapaper.com, all stationery for all occasions. We offered general correspondence and invitations from more than 50 suppliers. We were first in category with real-time previews and fully online ordering. 

In the spring of 2004, we noticed that our most prestigious supplier, Dempsey & Carroll,  had stopped answering the phone and shipping orders.  A few days later we saw a small blurb in Crain’s NY Business: Dempsey & Carroll had ceased operations, and the bank was auctioning the assets.

What an opportunity to acquire a heritage brand dating back to 1878! We immediately reached out to express interest in bidding. As a first step we scheduled a visit to the facility to see the operations and review the assets. 

My husband joined me as we walked the abandoned manufacturing floor. It looked like a neutron bomb had gone off – the presses were stopped mid stamp, half-finished orders were stacked on work tables, an open bag of chips sat in the employee lounge area -- there was not a person to be seen. 

We picked up a wedding invitation from a press for a wedding date that had already passed. We saw rows and rows of inventory in all stages of completion.  The business was frozen in time. 

The company had ceased operations without warning and without any communication. 

We learned they had run out of cash and the bank had seized the assets, telling the employees to leave immediately. It turned out the bank had been lending the company money against assets. Each time the company needed more cash, they’d make more inventory and borrow again. There was more than 5 years of inventory on the shelves. 

In fact, once we acquired the assets, we had so many skids of paper on hand that we did not need to order raw materials for more than two years. 

Because the bank was eager to recover at least a portion of their bad loan, we were able to come to an asset purchase agreement quite quickly. I remember the deal closing and then having a moment of panic. What now? I had never run a manufacturing operation. Where would I store 8 tractor trailer loads of inventory? 

Luckily, the former plant manager and I were able to partner – he would handle manufacturing and operations, and I would handle marketing and sales. 

Next up, create a website. This was something I knew how to do! In less than two months we had a basic site to take simple orders, including holiday, on the branded URL. This was already Q4 of 2004. From my experience with Chelsea Paper, I knew this was an important quarter. Having the site ready when people were naturally coming to look was critical – and one of two factors that made the restart so successful. 

The second factor, and probably more important, was our luck in getting the company’s legacy 800#. I had called the phone company to request it and they told me this is not how toll-free numbers are assigned. I may have begged and I most certainly seemed super dumb. Out of pity, the customer service person told me she would do what she could. 

About a week later, the phone rang. It was the same line we used for Chelsea Paper. The caller said she’d like to reorder her holiday cards and she gave me an order number. For a minute, I had no idea what she was talking about until a light bulb (virtually) went off over my head and I realized we had gotten the Dempsey & Carroll toll free number! 

Orders started coming in at a solid pace. Again, I thought – okay, great, now what. My manufacturing partner suggested I rehire the customer service person from the defunct former Dempsey & Carroll. 

Now, when an order came in, we’d send it to her and she’d manage the production. I had staff from Chelsea Paper who could help me out in these first months and quickly hired more to support client service, marketing and general management.

We were cash flow positive right away!

Next up was to figure out how to grow. There are many, many chapters in this part of my story. Each one is full of examples of how to do better – from what to do and especially what not to do. I will be sharing these stories here. I hope you’ll join me for the journey.