The Dandelion Patch is a Business in Bloom

By  Larry Siegel
Making hard choices and building relationships with bankers, vendors and customers allow a VA-based stationery and gift store to thrive in today’s economy. Tackling high-risk, business-altering decisions is nothing new for Heidi Kallett, president and “Chief Patchette” of The Dandelion Patch.  For instance, after keeping her second Virginia store “alive and kicking” by deciding to pay off a $125,000 line of credit when the “bubble” burst in November 2008, Kallett then decided to “double down” in 2010 and open two new stores.
 
“Paying off the loan was a real wake-up call for me. I had to face the fact that failure was an option if I didn’t make tough decisions, so I made them,” she says, immediately letting go of both her full-time buyer and merchandiser and cutting her business expenses to the bone.  With both her first store in the historic section of Vienna and the second in the high-traffic Reston Town Center stabilized, Kallett enlisted the help of her banker to twist the adverse economy to her advantage.
 
“According to the business plan my husband, Joel, an investment banker, had insisted I write before buying my first store in 2005, the success of The Dandelion Patch rested on expansion.  When two retail locations with fantastic lease options opened up in the Washington D.C. Metro Area, my banker’s analysis of my new financial position showed it made sense to not walk away from either deal,” she states, likening the decision to drinking from a fire hose.  “Opening stores in Leesburg, VA, and Georgetown, Washington D.C., in the same month actually strengthened relationships with my contractors and stationery vendors. In a tough economy, what business doesn’t want to hear, ‘Okay, now double everything!’?”

At the same time Kallett was deciding how to get her operations and overhead in order, she changed how she focused on her primary customer base — the bride. Taking into account that the majority of her brides were highly educated, busy professional women with higher earning potential, Kallett decided to raise her target custom wedding invitation order from $500 to more than $1,000. “This was a perilous decision to make for The Dandelion Patch because it necessitated sending a lot of customers away, but our analysis showed that brides with lower budgets were stretching to reach $500. That meant that they had nothing left to spend on menus, bridesmaid gifts, party favors and all the wonderful things that had much higher profit margins for us,” she states. Kallett further notes that by focusing on quality over quantity her business remained in the black in 2009 and grew more than 30 percent through 2010.
 
There was an additional benefit to “going high-end” for The Dandelion Patch in terms of vendor relationships. “When you consider that a typo or some miscommunication on an upscale order can cost a fortune to reprint, my vendors and my staff work more closely together and take the time to make sure mistakes are minimized,” Kallett asserts.  The store’s custom invitation vendors include Crane & Co., William Arthur, Smock, BT Elements, Designers’ Fine Press, Tag and Spark.  “I’m totally amazed that not only are we doing more volume with these vendors, but our average order price has risen,” she says, mentioning a recent $4,500 wedding invitation order with Smock.

Kallett also made a strategic decision in 2009 to create a deeper relationship with a vendor outside of the custom album arena in her stores. After working with Design Design on a project involving the Emily Post Institute, Kallett seized an opportunity to maximize greeting card sales while improving margins. 
“After paying off my line of credit, I couldn’t afford the fixtures and new inventory needed to create a bigger greeting card footprint in each of my four stores. Design Design’s owner, Don Kallil, saw how my traffic levels could lead to hundreds of thousands of dollars in sales and we came to an agreement that his company essentially runs ‘stores within our stores,’” she states. Design Design installed their own fixtures and has a dedicated supervisor managing and merchandising greeting card inventory at all The Dandelion Patch stores.  Kallett still approves all orders and can bring in other greeting card lines in spinners, but she admits that having “free manpower and deeper margins based on tremendous volume is a ‘win’ for me and Design Design getting 95 percent of our card sales is a ‘win’ for them.”

One decision Kallett made from the very beginning that has been critical to the continuing success of The Dandelion Patch, it was how she chose to market the store. “To flourish, I knew we needed to promote ourselves differently, which is why we hold events at each store every month and use social media and e-blasts to promote them,” she states. “Customers are always looking for escapes; vendors are eager to give away product to bolster sales; non-profits will let you into their ‘circle of influence’ when you support their cause; and local businesses will rally around opportunities that drive traffic into the area,” Kallett exclaims. “Our events deepen relationships and create good will. We touch so many people through our event marketing that it’s a decision I treasure.”