How Ukrainians built a successful leather goods business in the USA
What began as a hobby in a Kiev apartment turned into a successful business in the USA: two Ukrainian families fulfilled the American dream by building a leather accessories company with customers all over the world. According to 2017 firm olpr. Leather Goods Co. in North Carolina completed 11 thousands of orders. "Voice of America" talked with co-founder of the company Pavel Prannik, who spoke about the difficulties on the way to the goals and shared the secrets of success.
Leather experiments on the balcony of the 9 floor
In 2014, Victor Aleksin set himself a task: to make high-quality leather shoes. Then he could not even suspect that this would begin his journey to another continent and create a successful family business with clients around the world.
Not finding shoes on the Ukrainian market that would satisfy his personal quality requirements, Victor purchased a hand-held sewing machine and began experimenting on the balcony of his Kiev apartment on the 9 floor. He glued different pieces of leather, watched training videos on the Internet, sewed and ... repaired a machine that was constantly breaking.
In the process, it turned out that in order to make shoes, you need a lot of equipment, work and skill, so the idea came up to start with something easy - wallets and other accessories. Victor's sincere admiration for technologies and materials and constant conversations on this topic interested Pavel Prannik, his sister's husband.
“I can't say that I was too much interested in the technology of the production of leather soles, bags or wallets, but I frankly admired how obsessed Victor was with the idea of his ideal product,” Pavel recalls. Even then, he had the idea that Victor's products could be sold.
Due to unfavorable economic conditions, Victor quit his job and had more time for his hobby. Meanwhile, the depreciation of the hryvnia wiped out the online store, which Paul engaged with his wife. The couple had a desire to do business, and at a certain point an idea appeared to promote Victor’s interest and skills.
In July, 2014, Pavel quit his job and completely immersed in a new business. Then the team was formed: Victor and his wife Tatiana were responsible for technical questions, Pavel and his wife Yulia were engaged in sales, marketing and legal issues.
A month later, Pavel convinced Victor to buy a cheap, but complete, sewing machine for leather. It is this event that the team of entrepreneurs considers the beginning of the company.
First business attempts in Ukraine
Victor's purposefulness manifested itself, and already after some time, trial models of business card holders, wallets, bags began to appear. Not everything worked out as desired, but the entrepreneurs tried and believed that they would make their ideal collection of products.
The team sent all its forces to the fairs and social networks just at the time when fairs of goods of Ukrainian manufacturers began to appear in Kiev. Demand grew, and there were few manufacturers of leather accessories, so things were going well. Parallel, without much hope, Pavel registered a shop at Etsy, a site specializing in handicrafts. Unexpectedly, at the end of 2014, entrepreneurs began to receive orders from Etsy.
“At that time it was still strange for me why Americans buy products from Ukraine and are ready to wait so long until they arrive,” says Pavel. “As it turned out, they were not ready to wait: right away with the first orders we received questions as to why the delivery was so long”.
Customer complaints and the fact that the leather passport cover was sold on Etsy three times more expensive than at fairs in Kiev, forced Paul to think about what can be done to deliver goods faster. And when in February 2015, the year Paul and Victor got the opportunity to go to the USA, the men decided to take a chance. Paul explains:
“The calculation was simple: we will try to sell our products on Etsy from the United States with a minimum delivery time, and if everything works out, we will unwind the store, if not, we will return back to Kiev.
It was an incredible adventure, because men did not know whether they could start a business in a foreign country.
“We were losing what we had already done in Ukraine, not knowing what we would get in return in the United States,” Pavel notes. He's not sure if he would have dared to do this again, but thanks to the courage the men managed to do the incredible.
American dream with ... workshop in the living room
In the United States, the men and daughter of Pavel Justin settled with Victor's parents in the town of Mooresville, North Carolina. Pavel brought a computer with him, and Victor brought a suitcase full of tools. The sewing machine arrived by mail a month later - cracked, and Victor glued it on.
“It is still cracked,” says Pavel, “and oil is leaking from it, but every time I look at it, I find it funny, because half of our products are sewn on it.”
The American dream began with the living room in the apartment of the Viktor parents, which served as a workshop during the day and as a bedroom at night.
“In fact, everything was more complicated than we could have imagined,” Pavel recalls. One of the biggest challenges was finding leather suppliers. Those whom the men did find were setting exorbitant prices. In the end, the materials were found in Horween tannery - the famous American leather tannery, one of the oldest in the United States and the only one now in Chicago, founded in 1905 by a Kiev resident Isador Horowitz.
Pavel recalls the first purchase of the skin:
“In order to reduce the cost, we had to choose one type of leather and only one color per 100 square feet (9,3 square meters - approx. GA). We suffered for a long time, because we could not choose, and did not know what would come. Then this order was for $ 1000, and in 2017 we purchased leather from them for $ 160. ”
Sales in the Etsy then gradually increased and gave entrepreneurs hope for the best:
“We worked with Viktor from morning till night, without leaving the apartment: I posted product descriptions online and communicated with clients, and Viktor created new products. In the latter, the clients themselves helped us: we tried to fulfill all their whims - and as a result our bestsellers were born ”.
The decision to stay in the US and a lease on 125 000 dollars
So half a year passed, their wives came to Paul and Victor. At the same time, the question arose of what to do next. The family council decided to stay in the United States, but to do everything as required by US law.
“At that moment, perhaps the most difficult period of our stay in the USA began,” says Pavel. “We didn't know yet if we needed it, but we needed an incredible amount of resources to get it right.”
The team decided to request a business visa from the US government. Having no confidence that their request will be satisfied, entrepreneurs began to make investments in order to show their intention to run their own business in the USA.
The next difficult task was the choice of an office for the company, which provided for fixed and long-term expenses. Finally, a room was found in an old cotton factory. Signing a lease with a total amount of $ 125 over 000 years was the most difficult moment for Pavel in the entire history of their business - the figure scared him very much.
After that, we purchased equipment that was necessary for doing business in the United States. In case of refusal of a visa, he would have to leave and return to Ukraine. Fortunately, this did not happen:
“The way to get a business visa is not very popular if you do not have enough money in your account. And we didn't have them, - explains Pavel. “Therefore, even our lawyers were surprised that we received an affirmative answer. But we did an incredible job for that. "
The beginning of the future
By the beginning of 2016, entrepreneurs entered the new premises, where they are still working. On the square 220 square meters is located and the office and workshop. Business is growing, and now this room is already becoming insufficient.
Victor and three other people work in the production. Until recently, his wife also helped him. Victor and his sister Julia develop product designs, and sometimes they all think over new ideas. Julia and Pavel are responsible for marketing, customer relations and legal issues. There are also two workers in Ukraine who help respond to customer requests. Since labor is very expensive in the US, entrepreneurs try to do all the work as independently as possible.
The assortment includes notebooks, bags, backpacks, aprons, accessories for technology and travel, cases for glasses, belts, bracelets, stationery, collars for cats and more. Products are made by hand using techniques at some stages of production. The best selling are notebooks, especially through corporate orders when the customer's logo is applied to the products.
“In the beginning, we tried to increase the range and add as many goods as possible to Etsy, - says Pavel, - and then we looked at what went worse and what was better, and worked on what was selling better and improved. Now we have practically nothing ready: when an order appears, we make it in 1-2 days. "
In 2016, entrepreneurs joined Amazon Handmade, an alternative platform for selling hand-made products. It was just launched, and the Ukrainians were lucky to be the first to sell there.
"From month to month sales on Amazon grew and soon overtook Etsy. Now Amazon remains our leader in sales, ”emphasizes Pavel.
The secret of success
According to businessmen, they owe their success to personalized orders: the client can choose the color of the material and the thread, and also ask for embossing initials / names or engraving the logo, which ensures the uniqueness of the product.
“From the very beginning we had a lot of such requests, to which we gladly responded,” says Pavel. "This kind of work requires a lot of time to correspond with the customer, but as a result the customer is willing to pay much more for his special order."
The main market for which the company operates is the USA and Canada, however orders come from all continents. Entrepreneurs are proud of their small and big successes:
“Today for the first time we sent an order to Mauritania. We are very pleased that people appreciate what we do and we get a positive result from our efforts. Apparently, this makes us work from morning to night, seven days a week ... In the era of fast Chinese things, it is sometimes very difficult to compete with giant factories that produce leather goods, and we thank all our customers who are in an incredibly rich stream of choice to turn to We value our quality and uniqueness. This gives us the power to create our ideal product in the future. ”
Those who have an idea of their own business, Ukrainians are advised to start small and constantly improve.
"When I now look at the photographs of our first products," Pavel admits, "I understand: they have a primitive appearance, but, fortunately, this did not stop us then from acting and going forward."
Another important success factor for Pavel is having a team:
“It so happened that Victor thinks completely about production, and I, in turn, about sales and marketing. Of course, we have disputes, but in general it makes it possible to achieve a better result. "
The entrepreneurs plan to open a physical store this year in Charlotte, North Carolina. Since their whole adventure began with the desire to create the perfect shoe, entrepreneurs still joke that shoes are what they should come to someday.
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