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Small Business

Bright Outlook : Lamp Maker Sees Watts of Opportunity

July 09, 1996

Summit Lighting's growth from a supplier of felt for lamp bases to a full-fledged lamp and shade manufacturer was the result of careful observation of changes in the industry. Owners Jim Hesterly, David Haskell and Lee Szromba learned from the mistakes of their competitors and turned those misfortunes into opportunities. Hesterly was interviewed by Karen Kaplan.

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I used to work for a lamp manufacturing company that provided components to people who made lampshades. I saw an opportunity to sell felt to our customers as well, but my employer wasn't interested, so I struck out on my own. I gradually expanded and eventually I was making lampshades in my garage.

David had no experience with lamps, but he is an old friend, and he started helping out by building shelves. As he got more involved in the business, his position with the company evolved into sales.

Lee had worked for a large lamp manufacturer in Los Angeles. When his employer filed for bankruptcy, he came over too and put together a plan for us to produce entire lamps.

Lee's former employer did a lot of business with stores like Price Club. But his company had put too many eggs in that basket, and when those stores started buying from a different supplier, the company couldn't recover.

We have definitely learned from their mistakes. We are making sure we don't rely too much on any single account.

We knew a lot of companies that had shut down or moved out of state. We did our own autopsies and analyzed what went wrong. We don't like to see competitors going out of business, but when they do, it can be a springboard for our growth.

When we saw that the lamp companies were going out of business and our customer base was shrinking, we could have downsized. But we realized that doing just felt and lampshades was a shrinking market. Since there was a greater shrinkage of supply than demand, we thought there might be some opportunities.

When we started to build lampshades and lamp bases, we were in a position in which we were competing with our customers who bought felt from us. But we felt we needed to take advantage of those opportunities to expand.

A lot of companies are so caught up in doing what they do day in and day out that they don't look for new opportunities. But we're always looking for them.

On what they did when their competitors went out of business . . .

"We did our own autopsies and analyzed what went wrong so we wouldn't make the same mistakes."

On why they didn't downsize when their customers shut down . . .

"We realized that doing just felt and lampshades was a shrinking market. Since there was a greater shrinkage of supply than demand, we thought there might be some opportunities."

On the competitive advantages of watching your industry . . .

"A lot of companies are so caught up in doing what they do day in and day out that they don't look for new opportunities. But we're always looking for them."

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AT A GLANCE

Company name: Summit Lighting Inc.

Owners: Jim Hesterly, David Haskell and Lee Szromba

Nature of business: Lamp and shade manufacturers

Location: Sun Valley

Year founded: 1991

Number of employees: 38

Annual sales: $2.5 million

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