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COMPANY CLOSEUP By A.T. Palmer November 9, 1999


Tailoring the Web for Logo-Filled Wardrobes
Brad Keywell's Starbelly.com aims to modernize the way personalized clothing and other promotional items are designed, ordered, and produced

Before entrepreneur Bradley Keywell enrolled at the University of Michigan in l986, he made a list of what he wanted to accomplish during his freshman year. Topping that list: modernizing the university's 97-year-old maize-colored "M" logo. He sponsored a contest to freshen up the "M," even though he had no expectation that the university would adopt it. A student came up with a new design -- an impressionistic "M" -- that Keywell used for a poster he started selling on and around the university. Ultimately 10,000 copies were sold.

Now the 30-year-old Keywell is taking on what he thinks is another old-fashioned entity: the personalized clothing business. Keywell's six-month-old Internet-based company, Starbelly.com, aims to modernize the way such clothing is designed, ordered, and produced.

 

"At every step, there was a markup. The system was broken, ugly, and painful," says Volpe's Finnie
 

It's a big target -- a business with $75 billion in annual sales of everything from Mickey Mouse T-shirts to employee uniforms and promotional items for charities, sports teams, and the like. It used to be that an organization would have to leaf through paper catalogs to find a product, visit a middleman who would order it -- and then work up a prototype that included the customer's design choices. Customers would have to wait a few days or more to approve the prototype, then wait even longer for the stock to arrive and for the personalization. Altogether, the process could take up to six weeks. "It was a disorganized, cumbersome supply chain," says Charles H. Finnie, managing director of Volpe Brown Whalen & Co., a leading business-to-business Internet analyst. "At every step, there was a markup. The system was broken, ugly, and painful."

Starbelly.com claims it has reduced by 75% the number of steps involved in someone's order for personalized trinkets or clothing. That has cut the price by 30%-40% and delivery times by 75%. And it has given customers more control over how and what they order.

Here's how it works. Customers do their own ordering on-site. They select from a roster of 300,000 designs stored in the company's online library. Or customers can submit their own artwork for use on the clothing. They view different types of clothing and objects available in actual colors, design a prototype, and see it all instantly. After they approve the prototype, they can place an order in seconds, and deliveries are made within one week. Starbelly.com prints or embroiders the art or designs on clothing from manufacturers such as Champion and Fruit of the Loom.

FROM PEAPOD TO PIZZA. All orders are identified by bar-coded tracking numbers to keep them from getting lost in the system. By entering that number into a box on Starbelly's screen, customers can check the exact location of their order. And they can get a visual sense of where their order is in the process -- a system similar to Dell Computer's customer tracking system for computer orders. "What makes Starbelly so unusual is what makes the Internet so powerful," says Kevin E. Silverman, an analyst at Chicago-based ABN Amro Inc. "Starbelly can convey a lot of information directly to customers without using intermediaries. It lowers the cost of communicating with the customer since there's no direct sales force." Silverman estimates that Starbelly's revenues for the first year will be north of $20 million.

Customers give the site a thumbs-up. Online grocer Peapod Inc. uses Starbelly to help employees and customers order clothing emblazoned with Peapod's brand name. Other Starbelly customers, such as Little Caesars Enterprises Inc., use Starbelly's site to help them produce employee uniforms and promotional items for the nationwide pizza chain. "Many times our franchisees want to localize their products for a special promotion," says Denise Ilitch, Little Caesars vice-chairman. "It used to take forever. Doing this over the Internet gives our people more marketing flexibility."

 

Keywell's entrepreneurial success is no surprise to his former B-school professors -- or the legendary Sam Zell
 

Keywell's entrepreneurial success doesn't surprise his former professors or mentors. "Of 10,000 business students I've taught, he's at the top of the most creative," recalls Fred Kiesner, a former University of Michigan business school professor, now at Loyola Marymount University. Through his connection with Kiesner, Keywell apprenticed with legendary Chicago real estate financier and Michigan alumnus, Sam Zell. By scheduling all of his classes on Mondays and Tuesdays, Keywell was able to fly to Chicago weekly and work at Zell's real estate company and law firm during his senior year and three years of law school. "He's the kind of kid who spends most of his waking time trying to figure out how one plus one can equal three," says Zell. "He has classic entrepreneurial instincts."

Even while he launches Starbelly, Keywell remains owner and president of Brandon Inc., a Chicago-based supplier of trademarked clothing to large retailers such as Wal-Mart. As a middleman, he saw a way to automate the business using the Web. "People love wearing clothing that in some way identifies them with universities, companies, or not-for-profit organizations," he says. He could leverage Brandon's preexisting relationships with major apparel manufacturers to order as few as one shirt or jacket at a time, get quick delivery, and use Brandon's embroidering and personalizing machines.

It's too early to tell if Starbelly will be a big success. Analysts say that in order to build up a high-volume business, it will have to advertise heavily and win over customers who are doing things the old-fashioned way. "Starbelly is where the computer industry was when IBM was the low-risk approach and Apple and Dell were trying to sell to corporations," says Silverman, the Chicago analyst. "It took time to generate trust to generate big market-share gains." That's something even Starbelly's cutting-edge ordering system may not be able to overcome right away.

A.T. Palmer is a freelance writer in Chicago.


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WEB POINTERS
Click here to visit sites mentioned in the story:
Starbelly
Little Caesars
Peapod
ABN Amro
Fruit of the Loom




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