Of a Different Stripe

Beyond Zebra fashions promotional products for clients with an eye on using eco-friendly materials.
By: Daniel Miller
The Los Angeles Business Journal

Knickknacks: From left, Beyond Zebra’s Yamate-Ottengheime and Burleson with promotional items at their Burbank office. (Photo credit: Ringo H.W. CHIU/LABJ)

Need a knickknack to give away at your bank’s next investors conference? A T-shirt at your studio’s next movie premiere? Now, want those products to be inexpensive and “green”?

That’s the niche Beyond Zebra, Inc. is exploiting.

The Burbank company provides clients with a variety of promotional freebies — with a twist. It tries to use renewable raw materials whenever it can and sources them from what it says are eco-friendly factories in China, despite the country’s reputation as a place for sometimes shoddy manufacturing practices.

Since starting in 2000, the company has produced thousands of items for clients big and small, including Walt Disney Co., where the company’s two founders, Terri Yamate-Ottengheime and Stacy Burleson, met and worked.

Over the years, for example, the company has produced several products for Disney’s Environmentality Challenge, a green education program in schools, including clothing made from organic cloth and a Slinky of recycled aluminum.

“They go above and beyond in researching the eco-friendly giveaways we do,” said Christiane Maertens, manager of environmental affairs for Disney, who calls Beyond Zebra one of her favorite companies to work with. “They keep it light, there is no drama, it’s just, ’We got to get the job done.’”

But while there may be no drama for clients, behind the scenes it’s a different story. It’s been a challenge for the company to carve out its niche in an industry better known for throwaway tchotkes than durable products.

Supply chain issues have been the biggest challenge, requiring the duo to spend a good portion of time ensuring that their network of suppliers are actually making their products as advertised.

“There’s a lot of green washing going on and our experience has allowed us to sift through this so we know who to go through when we try to source new items,” said Yamate-Ottengheime, the company’s president, who often travels with her partner to Asia to inspect factories and meet manufacturers.

So what exactly makes up the gamut of green tchotkes?

Well, it could be a pen, key chain ring, hat, action figure or T-shirt. The ink might be soy-based, the cloth bamboo and the plastic manufactured from recycled resin. Recently, the company supplied biodegradable plastic sports bottles for the ESPY Awards, a sports awards show produced by cable network ESPN.

“It took longer than we expected because it took longer for the raw goods,” said Yamate-Ottengheime. Beyond Zebra has made other green products for the ESPYs, including bamboo clothing and lanyards made from recycled materials.

So far, about one-fifth of the company’s business is green, but that figure has grown in the last two years. What’s more, the vast majority of its 500 clients now inquire about green products.

That increase in business has meant more work overseeing foreign factories, distributors and other business associates — especially given the recent consumer product scares in China, including the finding of lead in children’s toys.

Also the average order tends to be small, typically about $3,000, including the cost of the product. And orders need to be turned around in one to four weeks.

For help, the company has turned to third-party quality assurance specialists such as Specialized Technology Resources Inc., an Enfield, Conn., company.

“They are willing to reduce their profit on a product just to ensure their product is safe and meets their own high internal specifications,” said Leeton Lee, a business development executive at Specialized Technology Resources, which has tested more than 100 Beyond Zebra products. “That puts pressure on the price, profitability and the delivery dates. They called me one night recently to make sure one of the inks in their products — it was a safe nontoxic, eco-friendly ink — met the specifications they required.”

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The Los Angeles Business Journal

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The duo has had a long business relationship and a shared background. Before founding the company, they worked together at Disney in the promotional products department, where they handled marketing and merchandising for a variety of franchises including the “Mighty Ducks” film series.

After they were both laid off in 2000 when their department was closed, they asked Disney’s legal counsel for the go-ahead to start their own promotional products company.

“They very warmly said, ‘We’d like for you to do it, because we have some products coming up we need promotion for,’” said Yamate-Ottengheime, a 1983 UCLA graduate who began working for Disney as a store manager and became a senior manager of promotional and specialty products.

Burleson, a 1993 San Diego State University graduate who worked her way up to promotional products buyer at Disney, said the pair literally had no down time after they were laid off. “We really ended our jobs on a Friday and started writing purchase orders on a Monday,” she said.

Initially, Beyond Zebra had an unnamed silent partner who helped get the company off the ground, but the duo was able to begin financing orders without the silent partner after making a $25,000 profit on an early order. They had a fourth partner — another Disney veteran — who left the company two years ago to raise her family on the East Coast.

In 2003, the company got a $230,000 revolving credit line from the Small Business Administration and left a smaller office in Burbank. It moved into its current digs next to the Golden State (5) Freeway, where the office is filled with whimsical furniture, toys and other Beyond Zebra products.

Last year, the company opened a one-person office in Jacksonville, Fla., to help with East Coast business, and now has a total of seven employees. The founders won’t discuss revenues or profits, but said the business is comfortably in the black.

“They are probably one of the most innovative and progressive companies,” said Ron Mendoza, vice president in charge of branded merchandise for Cherry Hill, N.J.-based TD Commerce Bank, which does more than $1 million in annual business with Beyond Zebra. “Every time they deliver a product, everyone says, ‘Oh, this is incredible.’ They do the impossible.”

One notable project, which was not green, was a massage pen with a vibrating top that Beyond Zebra developed for Commerce’s accounting customers in 2004. The pen was aimed at stressed-out accountants and was distributed with custom packaging that resembled a tax form.

“That made my career,” Mendoza said.

Beyond Zebra, Inc.

Founded: 2000

Core Business: Promotional products for entertainment studios and Fortune 500 companies

Employees in 2008: 7 (same as in 2007)

Goal: Short-term, to increase the green products portion of the business by 30 percent; and long-term, to open a separate environmental division

Driving Force: Companies that want to use green products for promotional giveaways

Article found in Volume 30, Number 39 September 29 — October 5, 2008 of The Los Angeles Business Journal

Click to download article (PDF).

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