Santa Monica Small Business Development Center

Santa Monica manufacturing startup reaches half a million dollars in sales thanks to the guidance of the SBDC.

When his employer, Hastings Plastics, was forced to close to make way for the Expo Line train, Eric Warren knew there was a need for a company to continue designing, fabricating and selling acrylic products such as boat windows and museum display cases to local businesses and artists. Hastings Plastics had been an institution in the Southern California art community, and Eric hoped to continue its heritage. But when the purchase didn’t work out, Eric and his wife, Claudia, didn’t give up. Instead, they started their own acrylic design and fabrication business, Santa Monica Plastics.

Challenges
An ad in the local newspaper Daily Breeze led Eric to the Small Business Development Center (SBDC) hosted by Santa Monica College. In late 2011 Eric visited the SBDC in hopes of finding financing to purchase Hastings Plastics. Eric worked with Business Advisor Jeffrey-Francis McAuther to crunch the numbers and apply for a loan. However, without enough assets to qualify for a loan on his own, lenders wanted him to obtain co-signers. Unfortunately, Eric had no relatives in-state who could co-sign the loan.
Still determined to fill the vacuum left by the demise of Hastings Plastic, Eric offered the owner all the capital he had–$7, 000—to buy the business. “He looked at me with disgust, ” Eric recalls. Undaunted, Eric discovered an affordable space nearby and decided to take a chance. He and Claudia bought a table saw and some inventory and put down the first months’ rent on the space. “When Hastings Plastics closed in December, I put up hand-painted wooden signs on the fence that said ‘Santa Monica Plastics, up the street’ with our phone number and address, ” Eric says. “In the two-week period before we opened our business January 2, I must have gotten a hundred phone calls.”
Best Advice
SBDC Business Advisors Robert Klepa, Trevor Schickman, Jeffrey-Francis McAuther and Steve Sedlic helped the Warrens create contracts, obtain licenses and permits, develop a business plan and marketing plan, and create operational procedures so they could take advantage of the customer demand that was there from the minute they opened their doors.

Client Impact
Santa Monica Plastics enjoyed sales of $300, 000 its first year in business and is on track for $500, 000 this year. About 70 percent of its customers are B2B clients such as contractors, architects, boat manufacturers and art museums, while 30 percent are individuals such as artists and design students. The Warrens’ plans include
expanding their consumer product line, moving into a bigger facility, selling internationally and franchising the business.