Beyond Coffee Mugs
by Patrick Casey
York Business Times
August 1999
BUSINESS OF THE MONTH
From basement beginnings, firm now ranked 76th in growth in Canada.
COMPANY PROFILE - The Promotional Specialists was established in North York in 1988 and has grown to become an experienced supplier of specialty advertising products and services. Company owners Aaron Moscoe and Andrew Rotenberg soon moved the business to Markham, where steady growth has resulted in 1,104-per-cent increase in revenue during the past five years.
From simple and effective products such as magnets, key rings, mugs and T-shirts to executive gifts, high-end watches, pens and electronic organizers, only the imagination limits what TPS offers to its clients.
The company has a diverse client base, including small businesses, schools, camps, non-profit organizations, advertising agencies and multi-national corporations. High-profile companies that have sought the expertise of TPS range from Paramount Entertainment and Alliance Atlantis to Prentice Hall Canada, Showcase Television And Sony Music Canada.
The company has produced items for popular feature films such as Batman & Robin, Boogie Nights, Star Wars, From Dusk Till Dawn, Twister and Jackie Brown.
In June, Profit magazine named TPS the 76th fastest growing Company in Canada with 1998 sales nearing $2.1 million.
TPS' Aaron Moscoe and Andrew Rotenberg are winning the promotion game by offering companies innovative ways to sell their products - from tattoos to corn cob holders
It's often the world's simplest products that have the ability to generate the most financial return. Aaron Moscoe and Andrew Rotenberg can certainly attest to that. For the past 11 years, the pair have turned a basement business into the 76th top-ranked Canadian company with revenue growth soaring more than 1,100 per cent over the last five years. After recording nearly $2.1 million in revenue last year, The Promotional Specialists has been red-flagged as one of the hottest young companies throughout the country. And aside from the creative work of Moscoe and Rotenberg, the success can be attributed to slapping logos, slogans and company names on an endless assortment of advertising products. The Markham-based business has produced items for such films as Batman & Robin, Twister, The Lost World, Scream and Boogie Nights, and scored a definitive winner last year by incorporating temporary tattoos with Energizer batteries.
Sales soared after wash-off replicas of the Energizer bunny were distributed at major sporting events and Energizer ordered a second shipment of 25,000 tattoos within a month's time. TPS has now ventured from tattoos to corn cob holders in the shape of the rabbit.
"As much as we do coffee mugs and T-shirts, we have many interesting products," Rotenberg, the 29-year-old vice-president, explained during an interview in their showroom, a splendid backdrop of hundreds of products they have worked with. "Sometimes people come to us and say they want a case of mugs, but I ask why. If it's going out to the public, you can also use something like a mouse pad instead. We have some key associates such as Energizer, General Motors and Signature Vacations. Energizer gets hit on every single day, so it's really comforting for us to have that kind of relationship."
They just don't go with anybody because they want good value and good ideas. You really have to understand their marketing. "And although the work is not really confidential, we wouldn't risk the business by going with somebody like Duracell," he added.
Rotenberg and Moscoe joined forces in 1988 when their paths crossed in an economics course at York University. Both had worked with distributors in the past marketing T-shirts and the like, but realized the route to success would open if they became distributors, instead of just buying from them. While the launch of TPS began, Rotenberg continued toward a business degree and Moscoe graduated law school b the time he turned 22, but gave up practicing law two years later to concentrate full time on the business endeavour.
"We started with the A's in the yellow pages and began calling every architectural firm to see if we could do any work for them. That's where we got our first client and it's just grown from there."
"We started with the A's in the yellow pages and began calling every architectural firm to see if we could do any work for them," pointed out Moscoe, president of TPS. "That's where we got our first client and it's just grown from there." "Law school wasn't a wash because it taught me to think, to negotiate and how to write. It's helpful sometimes dealing with people and in the earlier years, it garnished us a little more respect. We never blatantly had a problem from people because of our age, but you learn to push past it when you are young. Andrew and I both work hard, but we have a good balance together and that's part of being a good entrepreneur," he said. "Some nights we are here well past midnight working on a project, while other times we leave by 4 p.m. to go Sea-Doing."
The most frustrating aspect of building the business, said Rotenberg, has been the grief they faced dealing with financial institutions, but they are satisfied that a recent switch to the Bank of Nova Scotia will help make the company grow smoothly. Meanwhile, future trends include strategic relationships with marketing firms and contracts with wholesalers in the Far East to help reduce production costs.
"I went to the Orient last October just to get a better understanding of the situation and to visit several factories," said Moscoe, whose company is currently importing about 30 per cent of its products. "It's really important to deal with reputable factories and make sure they are not using child labour and the working conditions are clean. We don't want to support that and that was one area where my law background was quite helpful. We hire independent inspection companies to inspect the goods before it goes on the boat and our wholesalers won't get paid if it doesn't pass. Anything labour intensive can't really be done here for the right price. If we need 100 mugs, we go to a local supplier, but if we need 10,000, we'll go overseas."
So the next time you purchase a product featuring a scene from one of the latest major movie releases - like the 7,000 Godzilla T-shirts TPS whipped up in two days that even left their client wondering how they accomplished it - or walk home from the company golf tournament with a sleeve of balls, a bag of tees and a towel with the business name splashed on top, chances are good TPS had a hand in developing them. "We like to try and keep a few of the items for the office, but it's just impossible to keep something from everything we have done", said Rotenberg, almost reluctantly.
