Custom Ink LLC is finally coming up for air after a very tough 2020, but the business looks “pretty different coming out of the pandemic than it was going in,” CEO Marc Katz said.
First, the Fairfax custom printing and retail startup is fresh off an acquisition of New York-based corporate gifting company Swag.com, and revenue is around $500 million a year, Katz said, up both from 2020 and from 2019, though he declined to share more specifics. That doesn’t mean the company is completely out of the water yet, but it's a big upswing since the beginning of the coronavirus crisis.
On March 27 of last year, co-founder and Katz emailed employees to say that around 75% of the company's 1,700 workers would be furloughed through the end of May. Business contracted by about 80% in that period, Katz said. But nearly all the company’s employees were back on July 31, 2020, minus around 10% who had left the company in the interim or chose not to return.
Second, the company's offerings look very different now. At the very beginning of the pandemic, Custom Ink pivoted to face masks, and then sped up a plan that had in the works pre-pandemic to expand its offerings. The company began to provide a wider array of products, including drinkware, tech accessories and more, as opposed to its previous focus on t-shirts and other items to be used for in-person gatherings.
“It’s been a sort of very intense — exciting, but very intense — challenging roller coaster since then,” Katz said. How so? Demand has been unpredictable, with surges and dips as the pandemic has gone on. Then there are the supply chain issues and production capacity challenges. Custom Ink does all its printing and embroidery domestically, some in-house and some with contract partners. But those partners have been swamped with business from companies that typically would go overseas but are now “turning on-shore,” he said.
Headcount is up “modestly” from before the pandemic, but it's been hard to keep up with demand even with more employees, Katz said. “We’re trying to hire hundreds of people to try and support our anticipated 2022 sales,” he added. That includes in the production department, customer support, art and design and tech talent — essentially, everywhere.
Sales are way up from pre-pandemic levels, but Katz said the company has had to “throttle sales so we can keep up.” It has been working to scale production back up so it can release that throttle.
The November acquisition of Swag.com follows naturally from Custom Ink's pivot to more than just apparel. Swag.com lists Amazon, Coca-Cola, Facebook, Google, McDonald's, Netflix, Spotify, Starbucks, TikTok and Walmart among its 5,000 clients, according to the press release announcing the acquisition. Its interface also allows clients to “order, store, share and distribute their custom swag, all online," Katz said.
Swag.com doubled in size last year, according to the release, and it’s on track to reach more than $30 million in sales in 2021. Katz said Swag.com’s team of 70 won’t need to relocate to the D.C. area, and the site will continue to operate independently. Terms of the deal weren’t disclosed.
While he’s optimistic about the future of the business, “the present just continues to be really challenging,” Katz said. “It’s really difficult circumstances to operate in, but our people are awesome and doing their best. We’re trying to just stay as close as possible to our normal standards of excellence and we’ll hopefully get there and beyond next year."
