Originally published in Business Digest, November 1998

Achilles' Deal

by Craig C. Bailey

How does a distributor of packaging material ready his wares for shipment? Does he bury his bubble wrap deep inside a protective layer of foam peanuts? Does he label his mailing labels? Box his boxes?

Robert Achilles muses on that notion for a moment before the humor strikes him. "The beauty of it is that it's made to be safe anyway," he cries, "so you don't have to do anything to it!" And with a chuckle he's apparently discovered yet another reason why his business, Franklin-August Trading Inc. in Colchester, has naturally gravitated toward selling packaging material.

According to Achilles, the company's transition from supplying military bases with a variety of goods six years ago -- to selling boxes, bubble wrap, tape and stretch wrap to Vermont businesses -- has been a simple reaction to demand.

Robert Achilles Robert Achilles, owner of Franklin-August Trading Inc. in Colchester, distributes packaging materials to 400 businesses, mostly in Vermont. "There's so much business to be had in the state that it doesn't make sense to go looking outside the state yet," he says. (Photo: Jeff Clarke)

He founded the business in 1992 with Eric Robinson, a co-worker at Vermont Industrial Supply. When their Williston employer went belly- up, Robinson approached Achilles with a proposal to form a similar business -- a brokerage providing the link between manufacturers and government installations. "You can get in the business cheaply, because all you need is a little bit of cash to buy and sell stuff," explains Achilles. "Your overhead was pretty minimal."

The new business set up shop in a tiny office in the McAuliffe building on Flynn Avenue in Burlington. While Mr. Franklin and Mr. August were conspicuously absent -- Achilles and Robinson dreamed up their corporate name by assembling words they thought sounded good together -- the partners spent their days working the phones. "We started the business selling things, anything, to government installations all over the country," says Achilles. "They'd call us up and say, 'I want pricing on some material handling equipment' -- some ladders or something. If we had the best price, they'd buy it from us."

Within three months the business was rolling along, but Achilles eventually became dissatisfied. "The problem with it for me was that it was all phone calls," he admits.

His chance to switch gears came in mid-1994 when his wife, Elise, proved to be a valuable contact at her place of employment: Cornell Trading Inc. "They were having a real hard time getting their packing materials," relates Achilles, so his business received the assignment of locating materials for that Williston manufacturer and distributor of ladies' apparel and giftware. When it did, the two firms formed a long-term relationship. "They're still our biggest account today," Achilles says.

"They are good as far as pricing and the service is excellent," offers James Kirk, wholesale warehouse manager for Cornell Trading. "Ninety-five percent of the time I get my merchandise the next day. If I need something that same day, I know he'll bend over backwards to help me."

Achilles soon realized that to offer Cornell Trading a steady supply of packaging materials, he needed to warehouse the product. That was a whole different ballgame compared to the brokerage role the company had been playing for the government.

"We had that little office and nowhere to put a truckload of loose fill -- 300 bags of the stuff," says Achilles. Luckily, an unused weightlifting room adjacent to his office provided a temporary solution. "It really wasn't ours, but we filled it up with everything under the sun! It was packed. You couldn't even get in," he recalls. "It was dirty, it was a mess and it was a lot of work. But it was making us money.

"The margin was a lot better. Instead of making 15 percent selling to the government, we were making twice that if not more. All of a sudden it looked like there was an actual market for this."

Desperate for storage space, Franklin-August moved to Berard Drive in South Burlington at the end of 1994. "We filled it up in about two weeks," Achilles says. "We rented a second (10,000-square-foot) warehouse off site from that, then filled that up." In 1996 the company moved to its present 14,000-square-foot location at 49 Hercules Drive in Colchester. Nearly 90 percent of the space is warehouse, though Achilles says the business has an abundance of office space, considering its small staff.

After the Cornell Trading deal, Robinson continued to work the government sales side of the business, while Achilles focused on commercial accounts. By early 1997, Achilles says, government sales were "going into the gutter" as a result of changes in the government and less effort devoted to the cause. "That end of the business just wasn't making any money anymore and I couldn't see keeping it around," he says. "That's when I decided that I wanted the company." In May 1997, he bought out Robinson for the packaging materials side of the business. Robinson went on to continue selling items to the government under the name E.A. Aris.

"Since we started doing packaging in 1994," Achilles says, "we've grown anywhere between 15 and 30 percent a year." The company has acquired approximately 400 clients and projections for next year are $2 million. Not too shabby for an entrepreneur who jokes he "spent seven years screwing around" between high school graduation and the time he founded his business at age 25, jumping from job to job at least a dozen times.

Achilles came to South Burlington at age 14, when his mother, Paula, moved with him and his older brother, Paul, from outside Trenton, N.J. She knew the area from childhood family vacations and Achilles speculates she wanted to get him and his brother out of urban New Jersey. Another older brother, Michael, had already graduated and he stayed in the Garden State.

Within months, Paul moved back south to live with his father. When Achilles graduated from South Burlington High School in 1985, his mother returned to New Jersey as well. "It was like this really big plot to get me out of New Jersey," Achilles laughs, "and everyone was in on it except me!"

He attended a few semesters at Champlain College with an eye toward business management, but while Vermont was fine by him, college wasn't where he wanted to be. "I thought I was going to write for a living, and that's all I did for that time," he says of those years leading up to establishing his business. "I managed to get a handful of short stories published, but that's a long road. I still write a lot -- I'm just not planning on making a living from it right now," he adds.

To earn a living he worked a variety of jobs. "I used to supervise cleaning crews in the middle of the night at IBM. Got fired from that. I don't know why!" he exclaims, still incredulous after all these years. "Nothing was getting dirty for eight hours a night and I got fired! I couldn't believe it!"

In 1990, he met Elise Perreault at a Burlington club -- "I swore to myself when I was younger I'd never get serious about someone you meet in a bar," he jokes -- and the two were married three years later. "I spend a lot of time with her, because, outside of this, that's what I really look forward to," he offers. The couple had their first child, Malcolm Alexander, Sept. 26.

Elise's influence on Franklin-August went beyond providing a foot in the door at Cornell Trading: Achilles credits his lame duck bachelorhood in 1992 as the impetus to partnering with Robinson. "I had no job for the hundredth time in a very long time. She (Elise) wasn't very happy about that," he says, sheepishly. "I had to do something with my life.

"I never really wanted to be in business until the day we started doing it," he says, adding that once things got rolling, "I got fascinated by the whole process." Best of all, this aspiring creative writer discovered something about the nature of business: "There was something creative in it."

Achilles says growth at the company is focused on building existing accounts rather than establishing new ones. As the company's only salesperson, he says ramping up small, existing clients to become major ones is more efficient.

The company's "bread man" program is one way it grows small accounts and fosters long-term relationships. Achilles draws a comparison with bread delivery at a grocery: "No one sits down with the bread man and says, 'I want five loaves of this and five loaves of that.' He comes in and stocks it as needed. That's what we're doing."

Participants in the program receive weekly visits from a Franklin- August representative who takes inventory of the client's packaging materials, fills out an order based on pre-arranged minimum and maximum levels, and delivers the goods the next day. At no extra cost to the client, the program offers benefits to both sides: Franklin- August is assured it'll never be called by a client in a last-minute pinch, and the client can practically strike packaging material duties from its list of concerns. "They never have to think about it," says Achilles. Furthermore, the bread man contract locks supplier and client into a fixed price for one year.

"It's a wonderful deal," offers Sherrie Lucia, purchaser of warehouse supplies at Champion Jogbra Inc. The Essex distributor that ships products to hundreds of retailers across the country signed a bread man contract with Franklin-August a few months ago, and went from dealing with a variety of distributors for materials to practically just one. "It saves me time to do other things.

"We have a very good relationship between Rob and me. Right when I first met him, he seemed very nice, very open and honest," Lucia says.

Customer service is a topic on which Achilles waxes philosophic. Is making good on a promise to deliver goods within a given time frame, for example, good customer service? Or is that merely adequate? "That kind of drives me crazy," Achilles mutters. "What would be good customer service is if I call you up and I ask you to do something that is clearly above and beyond expectations. And you do it. What it all comes down to is this: We just work really hard at what we do. If somebody calls up and says they need something done, we do it." The result is often 10- to 12-hour days for Achilles and his staff.

With four staff members on the payroll, Achilles thinks Franklin- August has an advantage over its competitors, mostly larger, out-of- state businesses like Brown Packaging and Unisource. "You call one of my big competitors, someone answers the phone. They're very nice people and very knowledgeable, but it stops there," he says. "They have no control over whether people in the warehouse are really going to get it right ... because they're 15 layers removed. They could be in a different building and a different state."

With businesses shipping products for the holiday season, this is the busiest time of year for Franklin-August. The warehouse is packed, but Achilles thinks the Hercules Drive location will continue to be home for some time. "We've gotten a lot better at managing inventory," he says, surveying the corrugated landscape. "A good three-quarters of what we sell is turning within three weeks, so we don't need as much space."

Front and center are pallets loaded with merchandise packed using Franklin-August materials. The client has asked Achilles to store the goods temporarily before shipping them to the retailer. "That's how the business happened from the get-go: We got into packaging because somebody asked; we got into the bread man program because somebody approached us about it; we may get into storage and distribution because somebody else has asked us to do that," he says. "That's where the business grows."

Achilles seems to put to use at least one writer's secret: Sometimes it's wisest to give the best business stories room to simply write themselves.