When Delavan-based Geneva Supply Inc. received the designation as the region’s fastest growing company in MMAC’s Future 50 program last year, the Amazon and e-commerce strategy and fulfillment provider anticipated revenues around $99 million for the year. This year, the company anticipated more than $150 million in revenues, but those projections could almost be thrown
When Delavan-based Geneva Supply Inc. received the designation as the region’s fastest growing company in MMAC’s Future 50 program last year, the Amazon and e-commerce strategy and fulfillment provider anticipated revenues around $99 million for the year.
This year, the company anticipated more than $150 million in revenues, but those projections could almost be thrown out the window at this point. The company's 2020 revenues could actually end up being much higher than anticipated thanks to the huge increase in e-commerce as consumers are required to shelter in place during the COVID-19 coronavirus pandemic.
“I wouldn’t really guess (what the company's 2020 revenue will be), because who knows what next month will look like,” said Mark Becker, co-founder and chief operating officer of Geneva Supply.
“I’ve never been busier than I have in the last three weeks,” said Jeff Peterson, co-founder and chief executive officer. “It’s because every manufacturer is leaning on our experience and expertise with understanding Amazon.”
Geneva Supply started in 2009 on a wholesale model. The company would buy product from a manufacturer, sell it to an ecommerce retailer like Amazon and make a margin. Later, Geneva Supply added a third-party logistics offering in which customers paid to have products stored and handled by the company.
In the last decade, Geneva Supply has grown to work with 75 different e-commerce platforms and along with logistics provides services in direct-to-consumer, fulfillment and customization. The company serves a variety of industries including home improvement, sporting goods, industrial, pet products, hair care and vitamin supplements.
The company has around 130 employees across the country and around 200,000 square feet of warehouse space in Wisconsin, a 60,000-square-foot warehouse in Charleston, South Carolina and a 60,000-square-foot warehouse in Phoenix.
Other company divisions include services and digital marketing, but perhaps its Prestige Paints, Geneva Supply’s own line of paints sold online, that demonstrates the explosion in e-commerce brought on by the response to the coronavirus.
Before the virus hit, Prestige Paints would sell 50 to 75 gallons of paint per day. That figure now ranges from 600 to 1,000 daily, Peterson said.
“What this really has proven is people will buy paint online,” he added.
Geneva Supply is familiar with spikes in growth. Becker said the company typically sees steady results through the first nine months of the year.
“Our fourth quarter always jumps,” he said.
“Like a hockey stick,” Peterson added.
A big fourth quarter increase connected to holiday sales makes sense and a sharp drop in January would seem like a logical next step.
“That isn’t what happens,” Becker said, noting Geneva Supply typically sees just a small drop in January as the annual pattern repeats itself.
The company’s previous experience has set it up to handle the current crisis. Peterson said Geneva Supply is essentially living through a fourth quarter in March and April.
“If you’re in the e-commerce world and you don’t put an infrastructure in for extreme growth, rapid growth and spikes in business, and having your cash flow in place to do it, having a system in place, the e-commerce business probably isn’t your thing, because great business can put you out of business in e-commerce if you’re not prepared for it,” he said.
The spike in business isn’t as simple as increased demand for products. As shelter-in-place orders shifted demand online, Amazon prioritized essential products, which meant new challenges for companies with non-essential products.
“A lot of the calls that we’ve been getting are opportunities from companies that were not positioned to be able to have Amazon say ‘you can’t ship your product into our warehouse,” Peterson said.
He added that Geneva Supply’s previous work to be able to sell as a third-party on Amazon or to drop ship or seller-fulfill Prime packages allowed it to help manufacturers continue to sell their product in many cases.
“We were able to take the services we built and really show up to a manufacturer with this tool box and say we can help you fix this,” Becker said.
Geneva Supply also works with companies that have essential products and demand for those has “been literally off the charts,” Peterson said.
“Our biggest challenge has been how do we do this safely,” he added.
The company had to hire to add a second shift, moved office workers to working remote and increased cleaning from three times per week to twice per day, including cleaning every machine and work area.
"We put a large focus on trying to make sure the employees felt like we were doing everything we could to keep their area safe,” Becker said.
“It’s not just about whether they’re safe from the virus physically in their space,” Peterson said. “It’s always the anxiety that they have when they’re seeing everybody else that’s shut down but they’re still going to work.”
Becker and Peterson expect that the coronavirus will only accelerate trends toward e-commerce, noting consumers likely won’t be eager to return to crowded stores.
“E-commerce will benefit from this,” Becker said. “Because people who didn’t buy shampoo online, now for the last month have bought shampoo online and have thought ‘man, that was pretty easy, I’ll probably keep buying my shampoo online.'”
“It’s going to move everything up as far as anybody’s forecasts,” Peterson added.
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