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Loving what you do isn't a guarantee of entrepreneurial success. But a joyous small-business owner has an excitement about a product or service that makes a difference.

Love what you do.

It's not a guarantee of entrepreneurial success. But a joyous small-business owner has an excitement about a product or service that makes a difference to customers.

Step into the original Waxman Candles shop in Lawrence, Kan., or the newer one on Chicago's North Side, and you'll be thinking to yourself, "Somebody here is crazy about candles." That would be Bob Werts, 54 years old, who opened the Lawrence store, near the University of Kansas, in 1970. "I had time and I had no money," he says. "Candle making was an inexpensive hobby."

Mr. Werts dropped out of the university and rode the post-hippie candle boom all through the 1970s. Candles were mildly counter-cultural in those days, sold alongside the incense in many head shops, and mainstream retailers for the most part steered clear of the market.

Mr. Werts, who developed his own candle-making equipment and eventually retreated to the back room, leaving retail sales to others, became deeply immersed in scent, color and shape. "I love coming in in the morning and pouring wax," he says. Some 1,200 varieties are on sale at Waxman Candles.

"Bob is a tried-and-true hippie. Pony tail. Truly a candle maker," says Steve Traxler, Mr. Werts's partner in the Chicago store.

Paraffin wax, of course, is a petroleum product, and 1979's oil shock sent prices skyrocketing. That was a bummer for the candle business. It didn't pick up much until 1986, when nesting baby boomers embraced candle burning. In jumped bigger companies with national retail and distribution strategies and lower costs.

Yankee Candle Co., South Deerfield, Mass., which specializes in scented candles in jars, opened more than 250 stores and its sales hit $444.8 million last year, with plans to keep growing.

Cheaper imports followed. Pretty soon, Wal-Mart and Target and Linens 'N Things and even supermarkets were selling candles.

Shouldn't that have been the end of Mr. Werts and Waxman Candles?

After all, a box of 21 votive candles, the stubby little ones you burn in a small glass jar, sells for $4.99 at Linens 'N Things; votives are $12 a dozen at Waxman. A box of six no-scent, white 3-inch-by-6-inch pillar candles goes for $11.99 at Linens 'N Things; a single 3-inch-by-6-inch plain white pillar at Waxman sells for $9.50.

The changes in the marketplace weren't unnoticed by Mr. Werts. "We used to have the biggest supply of candles in the country," he says. "We don't anymore. Candles don't carry that mystique that they carried before. They're everywhere."

To most people, Mr. Werts says, "a candle's a candle." And Wal-Mart or any place else is a good place to buy some. But Mr. Werts's products are for people he calls "candle burners," those who wander in and wind up browsing for an hour or more.

The U.S. retail candle market boomed from about $1.8 billion in 1996 to $2.8 billion in 2000, the peak year, according to Unity Marketing, a market-research firm in Stevens, Pa. Mass retailers now outsell little shops.

That rising tide, however, lifted just about all the candle boats. During the 1990s, the Lawrence Waxman store's sales doubled to $700,000. The Chicago store, opened in 1996, peaked at $500,000. Both have seen recession and what appears to be a candle glut trim sales by about 20% over the past two years.

Mr. Werts's reaction has been to keep coming up with new candle designs--multilayer pillars that burn through various scents and colors, rough-textured ones known as cold pour candles, double-strength scents and tapered dipped candles twisted into odd shapes. Or, bring in any container you want to turn into a candle, and Mr. Werts will fill it up for you and stick a wick in it.

"It's labor intensive," says Mark Smirl, who manages the Chicago store, making its candles in the back room, and who lives in an apartment above it. "But it's Zen--you and the wax."

Even at the lower sales levels, the stores are profitable. After all, these days, at least, wax, is pretty cheap. And Mr. Traxler, the Chicago partner, says sales could fall significantly and the store would still be in the black.

The Waxman partners are hoping some of the less-serious candle sellers give up. And there are signs some might. Giftbeat, a Closter, N.J., trade publication for gift shops, reported recently that candle sales were either flat or down at about two-thirds of surveyed stores. Time to reduce space devoted to candles, the publication reported one store owner as recommending.

"I think it's going to be helpful that the candle trend is dying off," says Mr. Traxler. "You'll stop seeing candles at every store."

Regardless, the cheaper the better at Wal-Mart, Mr. Werts says. And he'll keep cooking up new candles for serious candle freaks. "Staying the course. Hey, I don't know how else to put it. I don't want to act like I don't know. But who does know?"

From StartupJournal.com
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