‘I love product’: Liz Uihlein…on running a $5.8 billion family business

Every family member in a family business comes with their own personality, strengths and skills that help a company grow. Pleasant Prairie-based packaging distributor and supplier Uline is no different.

“It turns out – I didn’t know it – I’m a merchant. I love product,” said Liz Uihlein, president and chief executive officer of the company. “It’s weird to develop a love of corrugated boxes and shipping supplies, but I really enjoy (it). It’s very exciting to get a product, write the copy, put it in 11 locations in North America, and so I really like the creative part.”

Uihlein said brother-in-law Steve Uihlein, a company vice president, brings finance expertise to the business, while Dick, her husband and the company chairman, is the one with big picture vision who suggests new areas or markets for the company. Phil Hunt, executive vice president at Uline, described Dick as “the pusher, the driver to keep us growing and moving forward.”

“‘You should be here, you should be there,’ but he wouldn’t do the work,” Liz Uihlein said during an interview in her office. “We did the work, but on our own we wouldn’t have done a lot because we are little busy bee workers and we’re happy where we are.”

Uline has been doing a lot of growing in the 10 years since the company moved its headquarters from Waukegan to Pleasant Prairie in 2010. Back then, the company had 2,400 employees across North America.

The company’s 2010 move started with a 1-million-square-foot warehouse and a 275,000-square-foot corporate headquarters office building. In 2014, Uline announced it would double the size of the Pleasant Prairie headquarters, adding a second, similar-sized corporate office building and another 1 million-square warehouse. In 2017, Uline added an 800,000-square-foot distribution facility in Kenosha and completed a second facility of the same size on the Kenosha campus in late 2019.

As far as corporate relocations go, the Uline story is a massive success. Wisconsin Economic Development Corp. records credit the company with $147 million of investment and more than double the amount of planned job creation.

Then in late 2019, Uline announced plans for two more new buildings, a nearly 1.1-million-square-foot warehouse facility and a 643,800-square-foot fulfillment facility at the Kenosha campus, a $130 million investment.

The latest expansion plans would take the company to more than 2,400 employees in Kenosha County alone. By the end of 2019, the company had nearly 6,700 employees across North America and $5.8 billion in revenue.

THE FIRST DOMINO

The LakeView Corporate Park in Pleasant Prairie had been developed for years by the time Uline came to Wisconsin, and the company wasn’t the first to make the jump across the border from Illinois. That said, Uline’s decision to pick Pleasant Prairie was an inflection point for development along the I-94 corridor.

“That was really one of the first dominos that led to what we’re now seeing, which is a filling in of the corridor between Milwaukee and the Illinois state line,” said Jim Paetsch, vice president for corporate relocation, expansion and attraction at Milwaukee 7.

Paetsch and M7, a regional economic development organization, didn’t work on the deal to bring Uline to Wisconsin, but their corporate attraction work has benefited from the company’s decision.

“It really has helped us in terms of credibility and it has gotten us into some discussions that maybe we wouldn’t have been in,” he said.

The company’s initial investment helped open eyes to the region, but the continued investment is what has helped convince other companies that they can capitalize on the assets of southeastern Wisconsin.

“It speaks very loudly to a prospect,” Paetsch said of Uline’s investments.

Had Uline stopped growing after its initial investment, the project still would be a major win for Pleasant Prairie and Kenosha County, said Todd Battle, president of the Kenosha Area Business Alliance.

“They’ve far exceeded anyone’s reasonable expectations,” he said.

Since 2010, Kenosha County’s job growth – up more than 33% – has nearly tripled the pace of Wisconsin as a whole while the growth in business establishments has been more than 1.5 times the statewide pace, according to U.S. Bureau of Labor Statistics data. During that time, Kenosha County wage growth has been slightly stronger than the state as a whole.

Uline’s growth alone doesn’t account for Kenosha County’s gains, but Battle said the company has been an advocate for doing business in Wisconsin. Uline executives have met with business leaders considering projects in the county and its human resources employees have met with businesses considering relocation to talk about hiring and employee retention in the area.

“They’ve been really willing to help the community in terms of telling the story,” Battle said.

CUSTOMER SERVICE FOCUS

While the right mix of family dynamics can help a company grow, three people – or six if you include the second generation – do not alone help a company grow like Uline has in the past decade, especially not at any larger scale.

Uline’s business generally follows the economy, so the prolonged expansion of the past decade certainly helped the company grow. Uihlein said there isn’t any particular region that’s been bad for business, although she noted growth has recently been slower at the company’s branch serving southern Mexico.

She also said growth was strong across all of 2018, extending into early 2019 before slowing down.

“In some respects, it was better because everybody was just gasping to hire people,” Uihlein said of the slowdown.

Economy aside, the company’s calling card is its customer service and next-day shipping when orders come in before 6 p.m. As Hunt put it, the idea is to “answer the phone faster than 911, have the inventory, ship the order out, get today’s work done today.”

Combining next-day shipping with a nearly 800-page catalog of products that includes more than 1,600 stock sizes of boxes and thousands of other products creates a challenge: having any of those products available and ready to ship to customers across North America.

“We get those orders from out of the blue … for some obscure things; you just can’t believe. ‘I need 200 traffic barriers.’ You know, it’s just, it’s crazy fun,” Uihlein said. “And sometimes we’re scrambling with as much inventory as we have, but you just never know who’s going to order and what they need.”

Being a private company helps since Uline can hold more inventory without having to answer to Wall Street. Having 11 branches spread across the U.S., Mexico and Canada also makes it easier to get products to customers quickly.

The Uline operations in Pleasant Prairie, located off Highway 165 and across the interstate from the Pleasant Prairie Premium Outlets, serve primarily as company headquarters and as a distribution center to stock the branches. The buildings located a few miles north in Kenosha and across I-94 from the Amazon facilities serve as the company’s Chicago branch, supplying customers across parts of Wisconsin, Illinois, Missouri, Indiana, Michigan, Ohio and Kentucky.

Ask Uihlein and Hunt about the size and scale of the company’s growth and they say their focus is elsewhere.

“You know what, I don’t ever think about it. It’s almost like bad luck, I don’t get up that way thinking about that,” she said, adding she’s more focused on what she needs to accomplish on a given day. “I’m not a visionary.”

Hunt added that he doesn’t really make it a point to check on Uline’s sales numbers on a daily basis.

“I look at the number of customers we backordered,” he said. “I might know the sales that day, but I might not. We’re much more focused on the service reports because (if) you take care of the customer, the sales are going to come.”

It is hard to do any Google search for the Uihleins or the company and not find articles about Liz and Dick’s political activity. They have been major donors and supporters of Republican candidates and causes. Liz Uihlein acknowledged taking a political stance does cost the company some sales.

“Since we’re private and we’re pretty passionate about it we feel that we should speak up,” Uihlein said. “I think people would say we’re kind, generous people but I believe the best thing you can give somebody is a job, not a government handout.”

Hunt said the political activity is not a major issue for the business.

“We lose some (sales), but most people are paying for a service and in the end, you’re paying for the service and you need the product,” he said.

FINDING THE RIGHT PRODUCTS

In addition to a growing economy and customer service, Uline has actually benefitted in some ways from a recent Supreme Court ruling that requires companies to pay sales tax in a state whether they have a physical presence there or not.

“We don’t like paying sales tax in every state,” Uihlein said. “(But) one thing it’s allowed us is to have our sales force go to every state because we have to pay sales tax anyway, so we’ve actually been expanding the sales force and they’re out and about in more places than just our distribution states.”

That growing fleet of sales reps provides information to the company on what products customers are looking for that Uline doesn’t carry. The information goes to marketing representatives for each product line before it’s filtered up to Uihlein and others who zero in on the most heavily requested items.

“We know the number of times a product has been requested through the year so they use that to help drive that process,” Hunt said.

With a 788-page catalog that will soon grow to more than 800 and run up against U.S. Postal Service limits, it’s hard to imagine Uline not having a product, but the company will add 1,200 new items with its next catalog.

There is a room on the second floor of Uline’s Pleasant Prairie headquarters with every page of the next catalog pinned to the wall. Each page, including copy and photo, will get attention from Uihlein before going out to customers.

“It’s how do you market it to your customer? For the guy on the street, how do you make it simple to put it in the catalog so they understand what it is, what its purpose is and why they should buy it?” Hunt said. “So, (Uihlein) really does that and she does a great job with the merchandising team with the copy and the photos and all that and she loves it.”

It might seem odd to continue mailing an 800-page catalog in an era of online ordering, but Uihlein likened the twice-a-year mailings to the repetition of advertisements by major brands and said it works for the company.

“It’s very effective for us to mail those catalogs; they’re basically not that expensive,” she said. “You go out to a warehouse and they’re flopping around and then ‘Oh, I need something, well, I’ve seen it, I’ll look it up in the catalog and then go order it on the web.’”

THE RIGHT PEOPLE

Whether they are family members or not, one of the biggest challenges facing the company is filling leadership positions, along with continuing to hire for sales and warehouse positions.

“We just don’t have enough people to fill some of those slots,” Hunt said. “And you want some outside experiences as well, right? Because it challenges what we’re doing.”

Finding people isn’t getting any easier with a tight labor market and continued economic development along the I-94 corridor. Kenosha County averaged an unemployment rate of 3.7% last year, up slightly from 3.5% in 2018, but a far cry from the 10.3% average in 2010 when Uline picked Pleasant Prairie.

“There must be people around because we’re hiring,” Uihlein said.

One of the benefits for Uline when the company moved across the border was the proximity to its previous location. Employees who lived in Illinois did not see much time added to their commute and those in Wisconsin had a shorter drive.

Kenosha County itself has historically had a lot of employees working in Illinois. According to U.S. Census data, around 27.3% of county residents worked outside of Wisconsin in 2010. The county’s growth of the past decade put a small dent in that figure – it’s now 26.8% – but there are now nearly 7,700 more Kenosha County residents working in Wisconsin than in 2010.

“So far, it’s supporting the growth,” Hunt said. “But we’re always concerned about … as the older folks start retiring, are there enough younger people? And are the schools teaching what they need to be teaching to get the quality employees?”

He noted that across geographies the company finds it challenging to hire people who can write copy or memos that communicate thoughts in a short, coherent way.

“We have these tests that we’ve developed and I’m the No. 1 fan of the test,” Uihlein said. “If you work here you believe in the tests and the lack of writing that’s coming out of school. Often (new hires) come in here, they take a right turn and go to (company training for) ‘how you write at Uline.’ It’s a real problem.”

“You have a lot of people that can give you data but they can’t tell you what it means,” Hunt added.

The right mix of family personalities, a focus on customer service and a growing product line all help a company reach new heights, but sustaining success requires people and the right people at that.

“Honestly, there’s been good people that work in the family business line and we’ve had some great business advisors,” Uihlein said. “We were lucky as we went along to have people that have helped us … I mean, we’re 40 years old now, so it wasn’t like an overnight, you know, pop sensation. It just built up slowly.”

But, like many companies, Uline is running into the challenges of long-tenured employees deciding to retire.

“We’ve had the most amazing management team all these years,” Uihlein said. “Every day we go to work and everybody’s going to be here. Well, now they’re starting to retire and they have every right to retire and then the generation below is smaller. It’s a smaller pond to fish in and, like a lot of companies, we have to either bring the other ones up or hire outside for some key positions.”

Uihlein jokes that she’s been talking about her own retirement for 15 years and said some days it does feel like it would be nice to just go on a long hike or sit on the couch and read.

“If it were that easy, you know, I guess I would be retired, maybe not,” she said, pointing out that she was happy as a housewife before starting her career.

Hunt said it is hard to find a replacement.

“Plus, she loves what she does, so she doesn’t want to give it up,” he said. “She wants to give parts of it up but it’s hard to find somebody – she has 40 years with the business – that has that much knowledge to come in and start taking over.” 

Uihlein noted that Hunt, who has been with Uline 28 years and is the No. 2 person at the company, has never shown an interest in taking over the top spot. 

“It’s not my skill set and it’s a lot of work,” he said.

There is a second generation of Uihlein family members in the business. Duke is a company vice president; Freddy Goldenberg  is in corporate planning and Brian is a vice president of merchandizing.

Liz Uihlein said the idea would be to eventually move the company to a second generation of family ownership, “but we’re realistic.”

“You know I always say I’m like Virginia McCaskey,” she said in reference to the 97-year-old owner of the Chicago Bears. “Dick and I say ‘while we’re alive,’ you feel a huge responsibility for your employees, you know what I mean? And I don’t want to crap out on them … so while we’re alive, but certainty nothing lasts forever.”

Uihlein said one of the challenges in family business is parents raise children to be independent and think and act for themselves.

“Then we’re supposed to all love one another in the family business together … it’s a conflicting deal,” she said.