Thanks to the ambient noise of his University of Southern California college campus and the surrounding urban chorus of screeching tires, police sirens and the occasional gunshot, Douglas Pick needed some sleep. Many nights, while a student at USC's Lloyd Greif Center for Entrepreneurial Studies, earplugs delivered the silence he craved.
After leaving a job at A&M Records in 1992, Pick put the lessons from his USC days to work to research earplugs. His nights on the L.A. university campus had made him a strong believer in the benefits of the tiny foam noise blockers. He saw opportunity in the sector and, later that year, launched DAP World from his apartment in Studio City, Calif.
Early on, Pick woke at about 4 a.m. to work on marketing, sales and operations. Afternoons, with the help of family and friends, he assembled products on his dining room table. Within five years, Pick's Hearos earplugs were distributed nationwide, and he needed to expand his operations. His home-based manufacturing system was no longer sufficient to meet demand, he says.
Pick was reluctant to take on the overhead necessary to house and run his own manufacturing facility and "all of the baby-sitting aspects of having employees," he says. But in October 1997, one of his suppliers suggested he meet with New Horizons, a North Hills, Calif.-based nonprofit organization that assists and employs developmentally disabled adults. New Horizons' facility was equipped to take on DAP World's manufacturing process and could also handle fulfillment and shipping.
"I had looked at other options, but I didn't like to take the business outside of U.S. borders. They were incredibly cost-competitive because the State of California, along with private contributions, helps subsidize them," Pick says.
Today DAP World, now based in Aliso Viejo, Calif., sells more than 36 million pairs of its Hearos and Pretty in Pink earplugs each year to retailers like Walgreens, Walmart, Rite Aid and CVS, generating roughly $5 million in annual gross revenue. Those numbers support jobs for more than 200 people at New Horizons. Pick calls the operations there "essentially flawless," with 99.8 percent of all shipments arriving on time at key retailers. The 0.2 percent that go astray? Carriers are usually to blame, not New Horizons, Pick says.
Pick also lauds the commitment of the people working for him through New Horizons. In 2010, he created a fund called Hearos Help to support New Horizons programs and to provide perks to all employees. Last year, part of his $10,000 donation was used to fund a picnic to thank employees for their dedication.
As DAP World expands its product lines, Pick says New Horizons will continue to be the manufacturing and logistics partner of choice.
"They are my trusted partner," he says, "so I can focus on the growth opportunities of the business."
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This article was originally published in the April 2011 print edition of Entrepreneur with the headline: Sound Principles.
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Comments:
"I had looked at other options, but I didn't like to take the business outside of U.S. borders." - Douglas Pick We need more business owners to think like Douglas Pick. Nowadays, everyone is so fast to ship manufacturing overseas without looking domestically first. If CA did not subsidize them, perhaps having the ear plugs made in a "fly over" state would have been just as cost effective. Plus, it is a lot easier (and cheaper) to visit your manufacturing plant in Nebraska than China or Taiwan. Nicely done, Mr. Pick.