ARCH Art & Drafting Supply — Small Biz Stories, Episode 12 - 2017 Top Social Media Auto Landing Page

When Susie Coliver started ARCH Art & Drafting Supply at 24 years old, she never could have anticipated how her business would evolve over the next 38 years.

From skyrocketing rent prices in San Francisco to the rise of digital drafting tools, Susie keeps her store going by facing trends head on and maintaining strong relationships with her customers and staff.

Listen as she shares how to stay relevant in a changing market and how she’s built a dedicated customer base that keeps her business going.

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Susie: For me, I think that we have all learned to be so efficient in the way we transact our days. We’re able to multitask so completely. We’re able to do so much from our desktop or our laptop or our telephone that you can actually go through days and days and days of never actually talking to anybody. From my inexperience, but long-term perspective, we all lose out in that equation. That being human, we need and want the connection.

Dave: You just heard from Susie Coliver, an architectural designer and the owner of ARCH Drafting Supply. Since starting her business over 38 years ago, Susie has faced challenges within an evolving San Francisco and architectural community. From skyrocketing rent prices to the rise of digital drafting tools, Susie’s store remains a cherished part of her community because of the connections she’s developed with her customers and staff.

Today, she shares how to stay relevant in a changing market and how she built a devoted customer base.

More than fifty percent of small businesses fail within the first five years. These are the stories of those who beat the odds. My name is Dave Charest and I’ll be your host as we share the stories of some of the bravest people you’ll ever meet, small business owners. You’ll hear how they got started, their biggest challenges, and their dreams for the future.

Dave: Susie’s path to becoming a business owner is an interesting one. While many people start a business to pursue their passion, Susie initially started her store as a way to finance the work she loved to do. Listen as she shares how she decided to start ARCH Drafting Supply at just 24 years old.

Susie: I came out of a very people-focused architectural education. Right out of school, I started doing architectural community organizing in an underserved neighborhood in San Francisco called Bernal Heights that was starting to undergo gentrification.

And there was an effort being made to provide opportunities for families who had always lived there or whose children had lived there and had gone away and wanted to come back, to be able to come back. That it wouldn’t become so fabulously expensive that it would become out of reach.

So I was doing this community organizing for about six months, and when I had tallied what I had actually been paid to do it, I realized I was being paid about 25 cents an hour. That’s what I was making. We figured the number of hours I was putting in and the paltry amount of money, and it was not sustainable.

So, I’m trying to think of how… But I really loved it. So how would I keep doing this and pay for it? And simultaneously to the community organizing, I was also working part time in an architectural office. And I was the low person on the totem pole. At that time, to run an office, you needed a lot of supplies because computers hadn’t been invented yet.

I was the one who had to go, when we ran out of the perfect green pencil or the roll of vellum or needed an ellipse template of a size that we didn’t already have in the office, I was the one who had to go and buy it. And the nearest place to buy that was about a half hour walk away. This was before people were bicycling. Nobody had bicycles then. This was in the late ’70s. It just wasn’t being done. Hitchhiking yes, but bicycling, no.

And the place where the architectural office was, was in the middle of where all the architects in town were. Not all, maybe 75% of the architects in town were all within this one district.

All those offices, the people had to go on a half an hour walk to get a single useful pencil. And I thought, “I wonder if I can open a store to serve the architectural community, all of which is in this neighborhood, and get it started, run it for six months or something, hire some great people, and go back to my community organizing full time,” which is really what I wanted to do. I wasn’t enjoying the work in the architectural office, and I was enjoying the work that wasn’t paying me.

So, I did it. I found a tiny, little space. It was probably 400 square feet. It had been a garage. And started it with $4,000, which was what I needed to outfit it and buy inventory. In those days, you could do that. Today it would take close to $1 million, but then it was in this city. Four thousand dollars got us off the ground.

And the only part of the calculation that didn’t work is the six months and then go back to doing what I set out to do. It was more like two and a half years until I could extricate myself enough to do anything else. It was two and a half years of 80-hour weeks. And then for like the next, I don’t know, 8 or 9 years, it was 40 hours on other stuff, architectural organizing, and 40 hours of store. It was still an 80-hour week, but it wasn’t 80 hours in the store.

Dave: The same passion that Susie felt for community organizing began to spill over to her store. At ARCH, Susie curated a world of technical pens, ellipse templates, rolls of vellum, and fine Swiss made compasses.

The store’s incredible selection, along with a knowledgeable and helpful staff, quickly established ARCH as the go-to place for architectural supplies and support.

Susie: We were serving as the sole supplier of architectural drafting supplies and knowledge, because we knew what architects needed and because I’d done it, and we knew what they didn’t know they needed but that we knew existed.

So we became the “Cheers” of the architecture community. It was the place and actually the only place, short of the local offices of the AIA, which is the American Institute of Architects, short of a professional stomping ground. We became the place for the architecture community to meet. It became a hangout. Any time you came, you knew you would see people you knew.

I think the people who come to us recognize “Their pricing is good, it’s fair,” and they recognize that in order to pay our staff a living wage, we cannot compete with online businesses, and we don’t try. We’re in it for the face-to-face, we’re in it for the engagement, for the relationship-building. We know the community of artists in San Francisco, they know us. There’s a lot of mutual respect.

They treat us as peers, especially our staff who’ve been here forever, and they’ve grown up with them. And they look to us as a place where people know their stuff. We’re used as a resource. We are on the phone a lot more than most businesses are these days because people call us for advice all the time.

Now, is that to say that people call us for advice and don’t then go buy the product online? No. Some of them do. But we’ll keep giving the advice regardless because we know, in time, that builds value.

Dave: Despite quickly establishing her business and customer base, it wasn’t long after Suzie opened ARCH’s doors that the whole architectural industry changed. As design went digital, the demand for drafting materials declined significantly. Suzie and her staff had no choice, but to shift their focus to reach a wider creative community.

Susie: The business has shifted focus a couple of times, out of necessity. When we started, we were strictly architectural drafting supplies. We didn’t have art supplies. When CAD, Computer Agent Design, came in to the architecture profession…and when I say architecture initially, that was architecture, landscape architecture, civil engineering, electrical and mechanical engineering, structural engineering, and all of the related construction design professions. But they all took on CAD within a five-year period. It went from needing a full cohort of supplies and equipment, to needing nothing that we sold.

During that five years, we transitioned to being a supplier to architecture students. So, less focus on the professional, more on architecture students who were still being taught things traditionally. It wasn’t until later that the architecture students also went on to CAD.

Although architecture students still buy supplies and remain a large part of our business. But we did transition over that period into art materials. We were trying to focus on the kinds of materials that not every other art store sold, things that were hard to find. So that there would be a reason for people to come to us. Because we can’t compete on breadth of stock.

At this moment, there is a great interest in this area — I don’t know nationally, but in this area — in the maker movement, in making things. There is a backlash against technology of a sort, or folding technology into a craft tradition. And with that rise of interest in making things by hand, there’s a lot of prototyping going on. There’s a lot of experimentation with C&C machines, with laser cutting, with large industrial machines that can be re-purposed for very delicate, very hands-on making. And we are excited about the role ARCH might play in supplying people who are on that cusp of technology and art.

Dave: So what’s interesting to me, you’ve been in business for so long now that having to go through that change in the industry and technology, how do you make those decisions or how do you keep your finger on the pulse of that, to know when to change and how to change? What was that process like for you?

Susie: Well, one, that I paid more attention to it so that we could be way ahead of that curve. In truth, much of it is a necessity. When people stop buying the things we have, we scratch our head and say, “Hm, now what can we do?” Examples of that…there are two good examples of that. One is portfolios, both for architects and for artists. Portfolios were a big part of what we provided, and we provided amazing portfolios from all over the world, so that everybody looks unique when they go into the interview. Well, now people represent their work on a flash drive. Nobody is carrying a leather portfolio into a meeting. And if they did, they wouldn’t get that job. So, the portfolio business just went away.

Another thing that went away is, people don’t write letters anymore. We used to have a cut paper section, eight-and-a-half by eleven paper, and envelopes. We had the greatest selection of envelopes, probably anywhere on the West Coast. And people were coming from all over, and they were coming especially when they needed to do announcements of important events – a birth of a child, a wedding.

People really aren’t mailing much anymore. I mean, anybody under 40 isn’t mailing much. Some people… We had one funny experience with a kid who was a Stanford undergrad, came in and said, “Oh, this is how you buy these things, these envelopes. I’ve never bought one of these.” Stanford undergrad. But in his world, the 20 years that he’d been on Earth, he had always been on the computer. His only correspondence was on the computer. He literally had never bought an envelope. Although he receives mail, he had never sent anything.

At that moment, we realized we don’t need an envelope department anymore. It’s not that we don’t sell any envelopes. We have specialty envelopes. There are people who still send wedding invitations, but very little.

So, of necessity, we’ve recognized we needed to shift. And when we realized that… For instance, we’re within a block of the Art Institute’s graduate program, and we see very few of those students. And it’s not because they’re going to other art supply stores, it’s because they’re not going to art supply stores. That’s not the art that’s being made in some graduate programs today. So, I wish I could say we’re ahead of the curve, but we’re not. We’re behind the curve, but attempting to react smartly.

Dave: Sitting and talking with Susie, it’s impossible not to feel the weight of another difficult change to her business model. At the time of our interview, ARCH is in the midst of a move. After being evicted from their third location in 2014, Susie opened a temporary pop-up shop. But with tiny, pencil and paper sized profit margins, Susie has a hard time competing with VC-backed startups to find affordable commercial space. Listen as she describes how steep rent increases impacted her business.

Susie: I don’t know if it’s the hardest thing but, one of the hardest things we’ve had to contend with absolutely is the exorbitant increase in rents, commercial rents, in San Francisco. There’s been a lot of national news about residential cost of homes and cost of renting. We know that it’s untenable at this point. It’s the prices in San Francisco. There’s been a lot less focus on commercial rents. But the fact is, running a small independent business in this city, with the rents that are being requested at this time, is nigh-on-impossible.

If you didn’t have venture capital behind you, there’s almost no way to do it. The only way we can do it, is that we’ve been doing it for a long time so we have an existing customer base — we’re not starting from scratch — and we’re pretty handy in making spaces that would seem to be undesirable work for us. We’re crafty in that way. But right now, if we were looking for commercial space in an area that retail businesses tend to go to right now, we’d be paying $4 a foot, probably at a minimum. And that would be in a place with foot-traffic. Obviously there are not enough erasers and pencils and pieces of paper you can sell to cover that kind of rent, $48 a foot. These supplies just don’t have that kind of margin.

So, losing our location. We’ve lost our location several times. The first move we made… We started at 43 Osgood, and then we grew by taking over the space next to us. That was easy. That was a no-brainer. The next move was also easy. We moved around the corner. It was the early ’80s, commercial rents were bearable. We ended up paying, more or less, the same amount per square foot, just more square feet. That worked pretty well. Then came the .com boom of 1999 and 2000, and rents went out of sight. There was nowhere in the downtown area that we could afford, nowhere, and we looked everywhere.

A lot of our customers moved out of town, because they couldn’t afford to do what they do in the city anymore. And we lucked out. We found a space in a warehouse that had previously had automotive parts, wholesale of automotive parts, and it was a property owned by a family who had owned it for 60 years. It had long since been paid for. They weren’t looking to maximize their income, they were looking for a stable tenant, and we had a long enough track record at that point and a good enough credit history that we were what they were looking for, and they were what we needed.

So that worked until 2014, which is the current period, when there is so much venture capital in this area. And there are so many new businesses starting that are starting with millions in their pocket, that rent is the least of their concerns. It’s such a minor part of their total picture, they don’t care what they pay. It’s not their money. They’re not earning it, it was given to them. Now they have to earn the trust of those who invested in them, but they didn’t have to earn it through their work, and that is just so difficult to compete with.

Dave: So, obviously you’re in the middle of a move, all this stuff happening now. Your biggest challenge now?

Susie: The biggest challenge of the move is gonna be getting the word out as to where we have gone. And, in some sense, there are those…we’ve dropped off the radar of many people in the last two years. People have had a hard time figuring out where we are, what we have at this location versus at the other location, what we have that we don’t even have out on view because it’s at a warehouse at yet another location. The parking where we are now has made it impossible for some people to shop with us. Just impossible. And so, some people who like us very much have given up on coming here.

I think our big issue, going forward right now, is letting people know we’re back in the game, better than ever, frankly improved and in a place that is accessible, both by public transit and by car because there’s parking, which, in San Francisco, is huge. I think it’s good that we’re getting the word out that we’re back in play.

Susie: The new location is not in a commercial district of any sort, it’s embedded in the place where people who make things are. So it’s very central to people who make physical things. And we sell products to people who make physical things. But it’s quite off the beaten path, and it’s not a location anybody would ever walk past, drive past, see from anywhere. We’re not near a coffee shop, there’s nothing else to do around us but do the work that we all enjoy doing, which is making things, designing things, making things, creating things. So we think it’s a perfect location. There’s probably not another business around that would think this was a perfect location for anything, but we’re very excited about it.

Dave: Which points to the importance of knowing your audience, right? It sounds like you know where these people are, you know where they’re doing these things, and that’s where you’re going to be.

Susie: It also, though, speaks to the importance of our online presence. Because we’re not visible on the street, you can’t drive past us and see our sign, or walk past us and think, “Oh, I think I’ll drop in there,” it means that the only way we grow beyond word of mouth is the online presence. So it becomes more important than ever.

Dave: With her business going through so many changes, Susie sees the importance of communicating with her customers regularly and keeping them up-to-date on everything from new product lines to location changes. Since 2009, she and her team have used email marketing to stay in touch their customers online.

Susie: We realized that without a regular presence in people’s inboxes, we were starting to disappear. That the people who knew about us knew about us, but new people weren’t finding out about us. That so much in business is driven by what one reads on their screen, that if they weren’t reading about us, they weren’t hearing about us. If they weren’t hearing about us, they weren’t talking about us. And if they weren’t talking about us, nobody else was talking about us either. So we were becoming a little invisible.

Frankly, that is why Constant Contact has been useful to us. We don’t have… We’re too small a staff to have a full time person putting our message out online. We can’t afford a person doing that. And so, beyond just Facebook and Instagram and Twitter, the only way we have a presence in the world right now is through Constant Contact. A presence, a physical presence. And because your template is quite easy to use, and because it doesn’t take much time, even our small staff which is stretched really thin, a couple of people are able to pull away from whatever else they’re doing and put out a memo, a message, an announcement, a fun fact, pretty regularly.

So people who are clever and bright and enthusiastic and creative, but not necessarily coders or programmers, can get stuff up online, and it can compete with those who have gazillion of dollars to spend on these things. And that’s, of course, very alluring.

Dave: Now in her 60s, Susie continues to face challenges head-on and adapt to serve San Francisco’s thriving art scene. It’s clear that she, as well as her staff — many of whom have been working with Susie for over 25 years — take great pride in their work and their role in supporting a diverse art community. Listen as Susie shares what’s helped her stay successful over the years.

Susie: I grew up in the ’50s and ’60s, and that was a time when children weren’t coddled. We were raised to make mistakes, and we made lots of them.

I think what that did, was it made us not afraid to make mistakes, and to recognize that there is life after failure, and if it doesn’t work one way, you try it a different way. It’s what I worry about with some children in some communities today, that there’s the coddling of effort, such that failure never happens. And if it, God forbid, ever did, there would be hell to pay. I think I haven’t been afraid of taking chances and finding out that that wasn’t a good idea.

Dave: What would you say is the biggest lesson you’ve learned, through the years, of this?

Susie: I don’t know if I’m gonna have a great answer to this. It may be that the biggest lesson that I’ve learned is how much I love it. Where it was…the intention was to serve a need, find a hole and fill it. Maybe the surprise and the lesson learned is that it’s not just the utility of it. There’s a lot of…far more than fondness, there’s a great affection. There’s a great affection for this store, not just me, but from the people I work with every day.

Susie: What keeps me going during difficult times is that I’m pretty passionate about this business and the way…and the place it holds in the city. It has a rather unique position in the city. I love San Francisco. And those few people in San Francisco who know of us and need us, love us back. It’s a very lovely give and take.

Dave: The reciprocal relationship that Susie feels between her store and its customers is the foundation that’s held ARCH up over the years. Susie, her customers, and her staff all know that they could find more cost-effective and time-efficient solutions online.

But they’d never want to. Because for them, efficiency can’t beat experience. The moments of connection, what Susie calls “the eyeball to eyeball,” are the reasons her business continues to be a valuable space.

I’ll leave you with Susie’s best advice for others starting a business of their own.

Susie: Well, I’d give advice but it won’t be taken, and that is, don’t do it for the money. Now, most people starting out in business do do it for the money, so they wouldn’t like that advice. But I think if it…to the extent that solutions are sought that will increase profits, solely increase profit for the purpose of profit, will not lead to a result that is likely to give personal, deep personal fulfillment.

We appreciate you listening and would love to hear what you think of the show. Please go to iTunes or Stitcher right now and leave us a review. Small Biz Stories is produced by myself and Miranda Paquet with editing by TwentyFourSound. You can contact us at podcast@constantcontact.com

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