SIS - COVERING THE FUTON WORLD

Historical Perspective:

When fabric was made on hand looms the cut and sew business just didn't exist. Then in 1790 Samuel Slater (1768-1835), of Pawtucket, RI, built the first water driven, spinning mill in America. High quality fabric could now be made, by that time's standards, in huge quantities. New England became the epicenter of a new global era in textile manufacturing. Then in 1834 Walter Hunt designed the first working lock stitch sewing machine. Elias Howe, another American inventor, patented a similar machine in 1846. Then, in the late 1840's, Issac Merit Singer pulled together several sewing machine patents and put in place the first factory to mass produce his now famous machines. Large quantities of quality fabric, sewing machines to speed up production, and a growing population of consumers all contributed to the birth of the cut and sew industry. Hundreds of companies began to spring up to meet the growing demand for apparel and other products around the textile mills being built along the many small and large rivers all over the Northeast region of the country. Later on, home sewing became a very popular activity. Particularly during the fifties, as scaled down versions of the sewing machine made their way into the American home.

The year was 1986. "As stay at home moms with small children we were challenged to earn an income," said Shari Hammer, owner of SIS Enterprises. "My sister Cyndi and I decided to take our home sewing skills on the road and we started our company so we could stay home and raise our kids as well as prove to ourselves that we actually could do it," she said. Having started out making draperies, which required a large amount of measuring and time consuming visits to client's homes, the SISters quickly latched on to the futon concept. "We had never heard the word futon until we came into contact with Dave Feddick of Santo Eto Futon in Minneapolis," said Hammer. The more adventurous Cyndi pushed the more conservative Shari headlong into the futon cover business. With an eager customer in Feddick and a growing awareness of the scope of the possibilities for future growth through contacts with futon pioneers Sun Tui and Tilt Chair, as well as a look at FANA's (Futon Association of North America now Futon Association International)Futon News, the pair began to expand their horizons. "We were still working out of Cyndi's basement when she decided we were going to the 1987 Futon EXPO in Montreal.

I reluctantly went along," said Shari. The Expo was an eye opener for both sisters. "We went to the show with three great Richloom fabrics (Green Mist, California Cool, and Paradise Lost) and our hand painted line. In fact the Richloom rep offered us just those three designs, and we took them all," she said. Neither of the women fully realized the potential of the industry, nor did they really understand that their dynamic work ethic and eye for style would be the catalysts of their growth. "We really knew nothing about production schedules or business in general back then," said Hammer. What they did know was how to produce and quickly ship, via hard work and long hours, great futon and pillow covers on a shoestring ($2000) capital investment. "We saw a company called In-line at the Montreal show and we decided we wanted to compete with them and only manufacture the finest quality and pick the fabrics we liked best. We didn't realize it then but we knew how to pick winners," she said. Shari also added that their ability to deliver goods in several days during this time of dramatic growth was also a key to their success. First year sales were about five-hundred thousand dollars. Shari also added that some of their current customers still try to order those original three Richloom fabrics.

Growth came easily over the next two years. Several other keys to the success of SIS Covers can be noted here. First, their hand painted covers were super hot sellers and SIS made great hand painted covers. "We would roll out three sixty yard rolls of fabric across Cyndi's back yard and two of her neighbors yards and splatter paint everywhere. The sun would dry the paint and that was the next day's production," said Shari. Second, SIS always delivered high quality products, quickly, and thirdly the principals worked on the line every day and never took a salary for the first three years they were in business. I admire them for that. I did the same thing.

In 1988 SIS moved into, what seemed then, to be a huge 4000 square foot space. Now with ten to twelve employees and a hundred-or-so customers the company was really on the move. Joe Hammer, Shari's husband, who has a strong accounting and computer background, has always been the company's financial advisor and analyst. "I can remember designing the book keeping software and working on the books late into the night for several years," said Joe Hammer, who left his job with the Carlson Companies to come on full time with SIS in 1994.

When you make the commitment to deliver stock goods in three days and custom in two weeks, and never say no, you'd better be ready to have the people and finished goods inventory to back it up.

Today SIS Covers operates with the help of about seventy employees from a 35,000 square foot facility in Columbia Heights, MN, just outside Minneapolis. Their system isn't unique for a modern cut and sew shop, but in the world of futon furniture (which had its start in garages and basements across America), SIS definitely has their act together.

When you arrive at the factory the first division of the company you encounter is the custom order department. "Custom orders for futon and other products comprise about twenty percent of our total business," said Joe Hammer. This division provides SIS's customers with an excellent resource. Shari also noted that with over 250 different fabric selections in the line, at any given time, the custom department can also become a bottle neck when volume is high. "Our philosophy has always been to say yes to our customers, and I'm convinced that that's another reason we are successful. But it can definitely slow things down a bit," she said. Scheduling for the custom department as well as regular production is all done by computer. "As orders come in they are processed at the office level by our customer service people. We are then able to check fabric inventory and develop the time line for production," said Joe. SIS uses a home grown software tool to accomplish scheduling and inventory reports. A daunting task when you consider that the company offers over 8000 SKU's. The process spits out a series of tickets and tags for each custom order which follows the entire process from cutting to sewing to packaging, tagging and shipping. For the regular stock (off the shelf) goods a more mass production oriented system is in place. Using a computer based report of items sold during a given week as a guide and with a goal of always having three weeks worth of finished goods on the shelf for each item the SIS team provides the production manager with a cutting schedule for the week. The system allows SIS to ship orders for any product in just a few days. "At the end of the production line, when the unit is packaged, Mary enters the item number into the system and the raw material inventory goes down while the finished goods inventory goes up. This allows us to stay on top of our finished and roll stock inventories, and keep the process moving" said Joe.

"When you make the commitment to deliver stock goods in three days and custom in two weeks, and never say no, you'd better be ready to have the people and finished goods inventory to back it up," he said. Shari added, "In fact colleagues have told us that this commitment to 'never say no' service has been the single most important factor of our success."

Innovation and originality have always been hallmarks at SIS. "We're convinced that the hand painted line we developed in the late eighties was a big part of our success and growth," said Shari, who added, "We were the first in the industry to bring in a line of exclusive, imported fabrics, and we were also the first to introduce upholstery grade fabrics for futons too." Upholstery grade wovens are now the standard of the industry and their extensive use has helped fuel industry growth as well. Other SIS innovations include the introduction of washable cottons and their recent introduction, at the 1996 Futon EXPO in Providence, of the button cover (see HOT COVERS page 34). This latest design offers the retailer an original look and the consumer another great fashion alternative.

Speaking of retail, SIS has been a leading supplier to some of the top futon furniture specialty retailers all across the country. With this experience has come a strategy, though not formally compiled, for retailers, that allows these vendors to sell more high end covers at better margins. "We have found that these practices can be employed by almost any retailer," says Hammer, "and sales increases of higher end products usually follow."

• Merchandising - Giving the showroom floor a class look with vignettes and accessories allow retailers to get those illusive higher prices.

   

• Back-up Inventory - Having a good supply of the hot sellers on hand allows the consumer to take it home.

   

• Changing It Around - Making daily or weekly cover and room decor changes (especially in the windows) gives walk by's and neighborhood consumers a fresh look that invites a visit.

   

• Dollar Phobia - Many retailers are convinced that they can't sell that $100 or $150 cover. Getting over this fear with a "can do" mind set has helped many a retailer change their ways.

   

When I began to wind down the interview with Shari and Joe Hammer, they both made a point to express their sincere appreciation for the diligence and hard work of their entire crew, both the office staff and the production teams. With special reference to John Christiansen, Customer Service Manager and Katharine Gotham, Director of Specialty Products, who are the company's other key management people (the four bios sidebar incudes a bit more info on John and Katharine). "We have always brought a lot of energy to this company," says Shari, "and with people like John and Katherine on the front lines we are confident of a great future. Other key personnel include production manager and futon industry veteran Marcie Forsberg (formerly Brown), plant manager Lance Pearson, credit manager Peggy Pappas, and customer contacts Michele Fyten, Kelly Moses, Helen Wilson and Ele Tobias.

With plans including some product diversity and continued growth, SIS is not a company resting on its past. Early next year the company will expand into another adjacent space of about 15,000 square feet. "In the past our growth has just come. Right now we are planning for growth," said Shari. "In the past we would just expand into some space that was available. As the numbers get bigger we have to plan our moves much more carefully," added Joe. The Hammers also said that as they learn to make better use of their company's capabilities and experience they see nothing ahead but positive things, and I couldn't agree with them more.

Shari & Joe Hammer   Shari Hammer BA Studio Arts, St. Olaf College 1987 - present: President, SIS Covers 1994 - 1996: FAI Board member Favorite cover: Tuscany Futon covers in my home: Faded Splendor, Rosedale, Estero Joe Hammer BA Economics, St. Olaf College MBA Finance, University of Texas CPA 1986 - 1991: General business consulting for mid-size businesses, Deloitte and Touche 1994 - present: Chief Financial Officer, SIS Covers Favorite cover: Woodbridge Futon covers in my home: see above.	John Christiansen, Customer Service Manager at SIS Covers since October 1993, started at SIS in 1991 working part time painting the handpainted covers and generally assisting Sue Ostrum in the office. Most of John's time is spent tracking orders, tracking sales, and tracking down missing futon covers. He answers questions and tries to solve any problems that come along, "though problems and complaints are freakishly rare at SIS," claims John. John graduated from St. Olaf College at Northfield, MN, in 1984, with a major in English. After working for Vail Associates in Vail, CO for a year, he returned to Minneapolis and started working at Campbell-Mithun-Esty Advertising, working on clients including Andersen Windows, International Dairy Queen, Dow Brands, General Mills, 3M Corp., Pillsbury, and Honeywell. After eight years and several jobs at the agency ending in the Print Production department, John decided to go to work full time at SIS for Shari Hammer, a friend from college. John's favorite futon cover is Pageant, though the covers on his futons at home are Corporal Blue, Ensign Blue, Brushed Tobasco, and Orleans/Toulouse.	In January of 1995, Katharine Gotham started with SIS Covers as a five-year futoneer. After graduating from Rutgers University in New Jersey, Katharine happened upon the futon world as a graphic designer in Charlottesville, Virginia. One minute she was working on a project for Atlantic Futon's Andrew Levine, and the next, she had entered the world of futons as a designer and store manager. After four years at Atlantic and a cross-country summer trek, she settled in Minneapolis to work for Dave Chadbourn and Pete Dodge at the Tilt Chair Company. Despite two Minnesota winters, Katharine and her husband, Jim, still wanted to live in Minneapolis and Katharine joined the SIS Covers team. She has happily worked here ever since. At SIS, Katharine spends most of her time making sure your custom covers and COMs are what you ordered, sorting your assorteds, answering questions, and looking for that one cover that absolutely, positively has to ship today. Katharine's favorite cover is Jokers Wild Olive.