After considerably expanding its catalog business in recent years, Franklin Mint is turning its back on the channel. On Nov. 12, management told about 200 employees of the Middletown, PA-based collectibles manufacturer/marketer that they would be laid off during the next four to five months as part of a major restructuring. Source close to company, who spoke on the condition of anonymity, told Catalog Age that this ties in with Franklin Mint’s decision to cease mailing catalogs.
Franklin Mint spokesperson Howard Lucker would say only that “the broader catalogs may not mail in the future.” The company, which dropped 30 million catalogs in 2003, mails eight titles, with product lines ranging from dolls to jewelry to Harley-Davidson memorabilia. “The biggest problem we had was not getting the new collectors into the fold,” Lucker says. “The current business model is not working.”
According to one anonymous source, Franklin Mint spent too much money on acquiring customers via space ads. And when the company started ramping up its catalog business in the mid-’90s, it discovered that the buyers of less-expensive collectibles didn’t always convert into repeat buyers of higher-end gifts. “The plan was to sell consumers a commemorative plate for $29.95, then get them to buy a $195 sculpture of Marilyn Monroe or Jackie Onassis,” the source says. “It just never worked.”
The source claims that the company expected to lose $8 million-$12 million in 2003, and that it lost close to $1 million in 2002. In 2000, Franklin Mint generated about $300 million in sales — about $100 million of which were from catalogs, says the source.
Lucker would not comment on Franklin Mint’s financials. He says that the company will continue as a smaller business concentrating on die-cast cars and airplanes, precision modeling, and Harley-Davidson-branded products that will be distributed via wholesale and the Internet.
Franklin Mint was founded in 1963 by Joel Segal, who later founded the QVC shopping network. The current owners, Stewart and Linda Rae Resnick, bought the company in 1985.