Here today, gone tomorrow: On Sept. 17, just 13 months after buying the T. Shipley and Reliable HomeOffice catalogs, B2B Brand Group sold them to San Francisco-based art supplies and gifts marketer Flax Art & Design.
Lyndhurst, NJ-based holding company B2B Brand Group suspended the operations of T. Shipley in June; Reliable HomeOffice had been put on hold in May. At that time, B2B Brand decided to focus on launching a retail chain for its Awards.com catalog/Internet business, which sells trophies, plaques, and other incentive items.
Flax Art & Design had exchanged mailing lists with both T. Shipley and Reliable HomeOffice during the past two years. But an apparent synergy isn’t the only reason Flax Art bought the titles.
“It was a great deal,” says Flax Art’s vice president of marketing Craig Flax. His company had made a play for the books last year before T. Shipley founder Tom Shipley sold them to B2B Brand. Although Flax won’t reveal the purchase price, “it’s a better price than we would have bought it for last year.”
That’s because B2B Brand, which was operating the two catalogs and Awards.com as three distinct entities, in August administered separate Assignment for the Benefit of Creditors (ABC) filings for T. Shipley and Reliable HomeOffice in Florida, where the books were incorporated. Not unlike a Chapter 7 filing, an ABC filing is a quick means of turning over the assets of a business to a trustee who liquidates them and passes all proceeds over to the creditors. In 2001, Reliable HomeOffice did $15 million in sales and T. Shipley $6 million, Flax says.
Immediately after the deal closed, Flax Art shipped the titles’ remaining inventory and computers to its Brisbane, CA, fulfillment center and offices. Flax Art plans to mail a T. Shipley catalog in November. A Reliable HomeOffice book will probably mail in January or February.
Tom Shipley, who retains a seat on the B2B Brand board along with managing partners Warren Struhl, Arnie Cohen, and Mitch Rothschild, will work with Flax Art on the catalogs for at least six months in a consulting role.
What went wrong?
B2B Brand’s problems, Shipley says, stemmed primarily from Reliable HomeOffice, which sells heavy desks, bookcases, and other furnishings, many of which are drop-shipped. “The shipping and logistics end was new and very different from the business model of any of our other businesses,” Shipley says.
Rothschild, who is B2B Brand’s general manager as well as a board member, says that “obviously, this is not where we expected the business to end up with when we bought it.”
Meanwhile, B2B Brand began opening Awards.com stores in New York, New Jersey, and Massachusetts in August, Rothschild says, and it has continued to mail the Awards.com catalog. The book is fulfilled out of T. Shipley’s former facility in Altamonte Springs, FL.