By Hope Belli Tinney, Washington SBDC
CLARKSTON, Wash. – Luke Hossner was a 20-something on-again, off-again college student when his father, Bryan Hossner, suggested that Luke help out with an online leather care business his dad managed.
Three years later, Luke works crazy hours to guide the rapid growth of DropForge Leather Care (http://dropforgeleathercare.com/), an online business he and Bryan created to sell their own small batch, private label leather care products. The company is working toward sales on Amazon.
“We had no idea we would be this far, this fast,” Bryan said. “It’s amazing what young people can do when you give them a chance.”
With a 30-year career in business administration, finance and banking, Bryan provides general counsel and startup capital. Luke is the enthusiastic jack-of-all-trades, doing everything from mixing products to building the website and figuring out Google Analytics. Employee Stephanie Peters is a “jill-of-all-trades,” Luke said, but is usually focused on production.
“There’s a difference between what you can learn by studying and what you can learn by doing,” Luke said. At any given moment, he said, “I have these two dozen things I need to figure out, and if they don’t happen, nothing else happens.”
The company’s products include all-natural cleaners, conditioners and protectants for any kind of leather product, from boots and bags to couches, car seats and dog collars. In recent months, DropForge has expanded to fabric waxes and cleaners as well as wax and oil wood treatments.
Seeking expertise to build customer base
Despite, or perhaps because of, Bryan’s extensive business experience, he reached out to the Washington Small Business Development Center (SBDC) early in the startup process.
The Washington SBDC (http://wsbdc.org/) is a network of more than two dozen business advisors working in communities across the state to help entrepreneurs start, grow or transition a business. SBDC advising is confidential, tailored to the needs of each client and provided at no cost to the client.
The Washington SBDC is hosted by Washington State University and receives funding from the U.S. Small Business Administration, WSU and other state and local institutions of higher education or economic development.
The Hossners began meeting with Aziz Makhani, the SBDC advisor in Pullman, Wash., in 2015 to discuss their business plan and efforts to build a customer base. Makhani, who has an MBA and a master’s degree in electrical engineering, also has 30 years’ experience in entrepreneurship, startups, online sales and high-tech industries.
Intern research, private label boost sales
Makhani tapped into various SBDC resources, including a student intern market research program, to compile a list of more than 100 leather goods companies and, when they’d exhausted that list, nearly 800 more businesses.
In early 2016 DropForge had about 80 clients selling leather care products under private labels. By October the client list was over 120, with more than 4,000 units shipped monthly to companies such as Kendal and Hyde, Duluth Pack and Craft and Lore.
Private label products are typically rebranded to carry the name of the client company.
“As soon as we pivoted to private label, things really took off,” Luke said. “We have been growing quickly, and new opportunities have been opening up left and right.”
Long experience, fresh perspective
Bryan said Makhani helped DropForge segment its target market into 10 leather categories, and SBDC research has helped find contacts in every segment – from motorcycle upholstery to equestrian equipment.
“Aziz has a genuine interest in our business and success,” Bryan said. “He and the SBDC research arm have been instrumental in providing us with marketing lists and contacts for a variety of leather makers and resellers.”
“I love talking to Aziz,” Luke said. “He’ll walk in with a fresh set of eyes, but a fresh set of eyes with a lot of experience. He helps guide us where we need to be.”
Expanding space, planning for Amazon
While private label sales remain their primary focus, Luke has been working to expand direct-to-consumer sales, too. A design firm is updating DropForge’s logo and graphic identity, one of the two dozen things to get done before launching DropForge products on Amazon.
Another item on the to-do list that was recently checked off is a new commercial space. The Hossners signed a lease on a new 1,000-square-foot warehouse at the Port of Clarkston with enough room to manufacture their products and store up to 10,000 units.
While Luke is focused on building DropForge into a million-dollar company, the entrepreneurial bug is pushing him to think beyond, as well.
“We’ve built this from the ground up, and that experience allows you to see even more things on the horizon,” he said – “new products to launch, new markets to enter and exciting new ways of operating.”