When Patrick Redmond moved from a position on the Tervis Tumbler board to CEO in early 2012, he was blown away with the company's efficient and proficient operation.
The Venice-based firm, after all, with 700 employees and roughly $100 million in annual sales, merely makes and sells a variety of cups. But after 11 months in the CEO chair, Redmond, who was on the board for two years, now sees firsthand how deep Tervis' products resonate with customers. “It's definitely one of those products that people get attached to,” says Redmond. “It's really so much more than a cup.”
In reality, it's more than 100,000 cups a day — the output Tervis can handle at its recently expanded 90,000-square-foot factory just east of Interstate 75 in north Venice. That customer passion Redmond discovered, moreover, also represents the company's biggest growth opportunity.
Redmond, in fact, says a top goal for 2013 is to expand the “direct to consumer” strategy. That includes adding more retail stores and utilizing a revamped e-commerce website. “Our stores,” says Redmond, “have been very successful.”
The company has 20 retail locations in total, a combination of stores and kiosks. The site selection team, says Redmond, looks for locations where people are on vacation or otherwise spending happy days with friends and family. That's why there are Tervis stores in Key West, Branson, Mo., and Myrtle Beach, S.C. Tervis also recently opened stores in the Alamo Plaza in San Antonio, Texas, and the Mall of America in Bloomington, Minn.
The direct-to-consumer expansion strategy at Tervis for 2013 is aggressive. Redmond expects the company will open at least 18 new stores next year. The firm also has invested heavily in a series of website and e-commerce products and upgrades, says Redmond, a trend he expects will continue well into next year. Recent additions include a cup customizing side of the website and an iPad app.
The website work paid off in at least one regard: Early season holiday sales the weekend after Thanksgiving increased 62% year-over-year versus 2011. “There was a push this year to make the website more robust,” says Redmond. “They did a great job with that.”
A former Jabil Circuit executive, Redmond replaced Barry Wolfson, who was CEO from December 2010 to February 2012. Wolfson, a Tervis consultant, had replaced Laura Spencer, a longtime executive who ran the firm for the early stages of its growth, in the mid- to late 2000s. The company was founded in 1946, in Detroit, and it relocated to Venice in the 1950s. It surpassed $1 million in annual sales in the 1990s, and has grown exponentially ever since.
Now, in addition to retail and direct-to-consumer expansion, Redmond has other goals for Tervis in 2013. New products and designs, for example, are two important segments of the strategy. He also says the company will continue to seek new licensing deals to go with the 50 or so entities it already has agreements with, from the NFL to Hello Kitty.
Another big-picture task for Redmond: manage the growth. The rapid rise in sales at Tervis might slowdown somewhat in 2013, he says, but even 20% growth brings challenges.
“The business has grown fast,” says Redmond. “Now we want it to be well balanced and well diversified.”