Entrepreneur Cordelia Smith is committed to hand-making all of Formulary 55’s bath, body and home goods. To keep up with orders at her growing venture, she has teamed up with like-minded makers.
What is entrepreneur Cordelia Smith’s biggest challenge? “Letting go of control,” she says.
Since launching her Pueblo, Colo., bath, body and home goods business in 1993, Smith has had her hands in everything from soapmaking to bookkeeping to sales calls. “I’m a very specific, type-A person as to how I want things to look and how I want things done.”
Today, she continues to oversee many aspects of operations at her company, Formulary 55, including marketing and packaging. But there is one critical area where she has loosened her grip: production. In addition to putting more trust in her nine-person in-house team, she has forged partnerships with other small-batch makers to keep product flowing.
“Certain parts, I’ve had to let go of to grow,” Smith says.
Distributing product-making this way has allowed her to offer a range of products that’s entirely handmade, which she sells to both online shoppers and the 800-plus retailers she has wholesale relationships with. Her mix of smart hires and strategic relationships allows Formulary 55 to get bigger while maintaining the same craftsmanship as when she started out more than 2 decades ago.
Strategic, Sustainable Relationships
Smith’s team of seven full-time and two part-time employees help her meet demand by manufacturing the majority of her products. The revenue from their work funds growth goals like expanding their facilities, she says, making them a critical piece of the puzzle — though finding the right full-time workers hasn’t always been easy.
“Our crew now is incredibly productive,” she says. But some former employees were taken aback by how demanding the job is. “It’s really hard — we manufacture so much, and it’s by hand.” So she supplemented her output through partnerships with other experienced vendors, which allowed Formulary 55 to expand its distribution, she says.
And expand, it has — Smith today has wholesale relationships with popular American retailers like Anthropologie, West Elm and Nordstrom, as well as stores in locations as far-flung as Japan, Australia, Nigeria, Switzerland and Saudi Arabia.In all, 30 percent of sales revenue comes from deals with larger stores and international retailers, while 59 percent comes from smaller U.S. boutiques — many of which are woman -owned, she says.
Best of all, her relationships with the three other small-batch ventures currently crafting her wares — located in Washington, California and Idaho — came about organically. She teamed up with one company that a group of past and present employees started, and forged a relationship with another entrepreneur she met on a flight. Smith pays partners per-piece for what they make, and supplies them with the recipes and materials they need. Makers then complete and ship back the finished products to her facilities in Colorado.
Smith has high standards for potential partners. “We look for makers that are already skilled in their fields and still make their products in small batches with great attention to detail,” she says. Engaging other small-batch makers gives her assurance that trusted hands are crafting products to her specifications.
And “it’s really important to us to continue making everything by hand,” Smith says.
Going handmade is not just a selling point for her products — “it’s the right thing to do,” she says. “It surprises me when I hear about large corporations or manufacturing facilities polluting their own water. I can’t wrap my mind around producing something that’s not socially responsible.” She even confesses to losing sleep over how recyclable her packaging materials are.
The Crafty Life
Smith’s fastidious approach to making products is born of a lifelong love of it. She recalls spending countless afternoons crafting at Campfire Girl meetings and weekends bonding with her beloved Aunt Judy, who made bohemian-style rugs.
As an adult, Smith began focusing on creating soaps and candles, inspired by products she enjoyed using in her own home. She realized she had a knack for making them and enjoyed the process, so she started selling her wares at local farmers markets near her then-home in Seattle.
“In the beginning, I didn’t think it could be a full-time job,” she recalls. But when she did the math, she saw that she was pulling in an extra $2,000 per year, and wanted to see how much further she could take the business.
She started it as a side hustle called Essential Soaps in 1993 using tips from her full-time barista job as startup funding, and soon made herself a mainstay at those weekend farmers markets.
It was there that she got her first request to enter into a wholesale relationship, from a high-end perfume store in town. Area home goods and furniture shop owners also took interest, so in 1995 she changed the business’ name to Sweet Petula — a childhood nickname from her mother. Soon, she became a full-time business owner, opening up several of her own retail locations.
The company grew steadily until the Great Recession hit in 2008, she says. And it hit Smith hard — she was forced to let go of all of her employees, close up most of her shops and work out of her studio apartment.
She found her way back to solid ground by 2012. And to celebrate the start of a new chapter, she debuted new products and rebranded again as Formulary 55. Two years later, she relocated to Pueblo, Colo., to take advantage of lower real estate costs, and has been back on the path to growth ever since. She declined to disclose annual revenue figures, but says each month she and her team fill roughly 100 orders for various wholesale clients and about 400 orders for 1,200 and 2,000 items to individuals who order through her e-commerce site.
A Community in a Business
Later this year, Formulary 55 will move into a larger manufacturing facility. Amid rising sales projections, “we are growing the team and constantly training.” She is also continually coming up with new recipes for her soaps, masks and other products as she works to remain competitive in a crowded market.
No matter how big the company grows, though, Smith says her top priority is ensuring that “the people who work here still feel fulfilled, happy and well-compensated.” Her desire for control persists, she says, but it’s balanced out by the value she recognizes in her team and partners.
“It’s so important to me that the people I work with feel like they are a big part of the story,” she says, adding that she is now just as invested in fostering a sense of community within her company as she is in creating a quality product.
Posted: September 7, 2018