The odds seemed stacked against Janska, even before the Colorado Springs clothing manufacturer got off the ground.
The couple who started it had no background in the apparel industry, no marketing acumen and no experience running a small business. All they had was a dream to produce comfortable yet fashionable fleece clothing - and when they did get the business going, they ran into cash-flow problems and quality issues from one of its primary vendors.
If you'd bet against Janska, though, you would have lost. After 11 sometimes rocky years, the company beat the odds and now has 40 employees, a projection of $3 million in sales this year, and a growing list of awards that include owner Jan Erickson's recognition as the state's top small businessperson for 2014. She will compete with winners from 49 other states, the District of Columbia, Puerto Rico and Guam for the national Small Business Person of the Year award May 15-16 in Washington, D.C.
"It is a miracle they survived," said Gerald Smith, a Service Corps of Retired Executives (SCORE) mentor who helped Erickson and her husband, Jon Thomas, Janska's vice president, learn about management, finance, accounting, budgeting and forecasting sales. "They had nothing to bring to the business except her dream and their savings. Neither of them had any business experience or expertise in manufacturing, the apparel industry or marketing."
But Erickson and Thomas knew enough to ask for assistance. They turned to SCORE and the Colorado Springs Small Business Development Center to help the them avoid the problems that doom many small businesses to failure: growing too fast and running out of cash to pay suppliers, lenders, employees and others.
"They were smart enough to come and ask for help when they thought they were having a problem and it was a very timely concern," said Mike Conway, the first SCORE mentor who helped Janska survive a cash-flow problem and adopt more sophisticated financial management practices. "Jan had a good vision of the product and what she wanted the company to be. Even though she and Jon weren't business people, they worked hard to understand the business. They have worked hard to be on top of what is happening to the business and not be following or reacting later."
Business born from dream
Erickson got the idea for Janska when she was caring for a friend who suffered a stroke in 2001. She found it difficult to dress her friend, Jean Jauchen, in any garment that had a traditional sleeve.
Then, one night, Erickson dreamed of a lightweight red print polar fleece jacket that had deep raglan sleeves, a large zipper pull and an overlapping open-back design. She woke up, sketched the jacket and took it to Sew & Sew Manufacturing, a Colorado Springs-based contract sewing operation that produced mittens for her running group. The company made the jacket for Erickson, who gave it to Jauchen.
"Then all of these ideas came into my head for a lap blanket, fleece socks and a jacket with big, wide sleeves to make it easy to get on and off," Erickson said.
She spent the next two years researching the industry to see if any manufacturers were making similar products. Unable to find one, she and Thomas used their retirement savings to start Janska in 2003 and rented a small office on Platte Avenue.
"We knew that we didn't know enough, so we went to the Small Business Development Center and took a class on how to put together a business. We have been learning from that day forward," said Thomas, who spent 17 years as a lawyer before helping Erickson start Janska.
Erickson hired the son-in-law of a fellow volunteer from the Children's Literacy Center to design a Web page and logo for Janska. Through him, she met Jan Avramov, a costume designer for Colorado College who spent nights and weekends turning Erickson's dreams into a line of products.
Initially, the company sold directly to consumers on the Web. The couple also traveled around the region, displaying Janska's merchandise from a tent attached to the back of their Ford Expedition.
The company grew in the first few years, expanding from a one-room office to five rooms, and later moving into an industrial complex off Fillmore Street.
But Erickson and Thomas found that selling clothing to those with disabilities was a difficult market to crack. After two years of hauling merchandise around, they attended a show at the Denver Merchandise Mart in 2005 in hopes of getting a few orders from hospital gift shops and other small retailers.
"We had six products to show in five colors and had been told to expect maybe two orders," Erickson said. "The stores told us they loved what we were doing, including the owner of Luma at The Broadmoor. We ended up with 19 or 20 orders."
Those orders prompted Janska to split its product line between clothing for people with disabilities and a fashion line of everyday apparel for all consumers, which now accounts for more than 90 percent of its sales. "We thought we would be making adaptive clothing for people who had movement limitations, but the market took us in a new direction," Thomas said.
Janska's sales grew steadily over the next few years as more boutiques started carrying its fashion line of clothing, but the company didn't reach $1 million in sales or earn its first profit until 2011, when 600 shops were selling its merchandise, Erickson said.
Through their journey, Erickson and Thomas have continued to get advice from the experts. They got assistance from SCORE, for example, when they realized they needed help to turn what Erickson called a "cottage industry" into a thriving small business that could get a bank loan.
"They helped us grow up as a business with budgets and cash-flow analyses so we could go to a bank and get a line of credit," Erickson said.
The couple worked with three SCORE counselors to improve Janska's record-keeping and financial forecasting so the company would buy the right amount of cloth and other supplies and not end up with too much unsold inventory at the end of its selling season.
Those changes put Janska in a position to take advantage of an opportunity to bring some of its manufacturing in-house, when it acquired the equipment of the now-defunct Farfelu Manufacturing, took over its nearby factory space and hired some of its employees. Janska also started doing contract production for another clothing manufacturer, which helps generate additional revenue and keeps its production employees busy during lulls between sales seasons.
The company's sales surged, reaching more than $2 million in 2012 - creating challenges for Janska's staff and contractors to keep up with demand and forcing the company to find a larger building near Interstate 25 and Circle Drive to accommodate its growth.
One of the biggest challenges the company faced was trying to find employees to sew its garments in an area with little or no textile manufacturing, said Conway, the SCORE counselor. The company now looks for potential employees interested in learning commercial sewing and then trains them.
Last year brought another big challenge. Janska started having quality issues with its sole fleece supplier, which stalled the company's growth, damaged its reputation and forced it to find a new supplier, said Smith, the SCORE counselor.
"They received rolls of defective fabric and it nearly bankrupted them," Smith said.
Erickson and Thomas had enough savings to keep the company going, but Janska might not have survived if the quality problems had continued another six months, he said. Luckily, the company found a new supplier and may add a second to reduce its reliance on a single supplier, Smith said.
Conway said Janska continues to adapt to a changing market by working with a California consultant to make its manufacturing line more efficient. The company changed its production process from producing dozens of garments at a time to working on a single piece of clothing at a time, which has reduced waste and speeded up its production, both key factors for a company whose primary competitors are mostly overseas.
Janska's two product lines are all manufactured in the U.S. and sold in about 1,000 U.S. and Canadian stores as well as 10 catalogs. But Thomas believes the potential market for its products is likely 3,000 to 4,000 retailers, which he hopes could generate $10 million in sales and employ close to 100 people within five years.
Erickson and Thomas also are still trying to tap the market for their adaptive clothing line and are looking to hire a few bloggers to promote it.
"The fashion side of the business is carrying us and allowing us to pursue the adaptive side," Thomas said.
Chuck Kocher, a Colorado Springs-based business coach who is working with Janska, said he is confident the company can meet those goals, primarily by expanding from a regional market to a national one and adding new products.
"Our vision is to offer comfort to millions of people. Our primary market is women 35 years and older looking for style, comfort and easy care in the same garment. We want people to look good and feel good in an American-made product," Erickson said. "Our buyer is more educated with a higher median income that is willing to pay a bit more because someone in the U.S. made it instead of somebody making $2 a day somewhere else."
Contact Wayne Heilman: 636-0234