Халықаралық серіктестегі қалалық жоғары оқу орны / Мемлекеттік лицензия АБ 0137478
Халықаралық аккредитация ACBSP (АҚШ) / Институциональдық жәнемамандандырылған аккредитация БСҚЕЖҚТА(Қазақстан)

Davydov Vladimir


Davydov Vladimir

Kazakhstan-American Free University, Ust-Kamenogorsk, Kazakhstan

I.  General Description of the Company

The MagnetStreet company was founded by Neville B. Baird in 1991. As it always happens the successful business requires a brilliant and smart idea to start with. So, Neville was excited about his idea of creating magnets basing on his 3 principles:

·  Full color picture

·  Perfect quality

·  Fair price

He received his first order in 1993 on a trade show. A couple of women came to his trade place and saw the magnet samples he made. They were impressed with those samples and asked him if he could place their photograph on the magnet. “Yes” was the Neville’s answer. But the most interesting thing about that was that he actually had no idea how to do what he was asked. By that time all the samples and all the further products were outsourced, so Neville himself didn’t make any magnets and he contracted the other companies and used their forces to design and produce his products.

After the business turned into the serious scales and started bringing good profit Neville had no need to use outsourcing. Nowadays MagnetStreet is a middle-sized company with an average daily turnover of $ 45,000 - $ 50,000, 102 employees, an office building and a plant in Wheaton, Illinois, and a branch in Minneapolis, Minnesota. In early 90-s the company’s niche was the real estate market. The realtors used a lot of calendar-magnets and business cards in order to promote their houses. After the real estate market went down the company faced its first crisis. The “life raft” happened to be the diversification of the production. Consequently the research was made and the new market was targeted – the wedding market. Today according to the official statistics over 200,000 engagements take place in US every month, which are approximately 2,400,000 marriages annually. Of course, it doesn’t necessarily mean that MagnetStreet receives all 2,400,000 orders. One of the Neville’s business principles is “small portion of the market cake”. It’s easier to run a small business which is 5% of the market than a 40% corporation. So, wedding became the new niche and the wedding product line today is very wide. The company offers to a customer “save the date magnets”, wedding invitations, “Thank you” cards and other wedding-related products.

Around 8 years ago the company made a great advance going online and opening their own web-site. Besides the advertising the web-site was also designed for the customers to make online orders with further shipping to their homes. But the most tremendous opportunity had become the unique “design studio” - the design program that allowed the customer to go online to the web-site and design his or her own product using different graphic tools and wide variety of samples. That helped the company to increase the productivity by decreasing the number of time spent on manual design and cutting the spending on designer salaries. MagnetStreet discovered the opportunity to produce more and faster with lower personnel. Today the company is doing its business online – from early morning when the employees come to work till the midnight when the web-site is still accessible to the customer. And of course it works on Saturday and Sunday as well. 

II.  The Order Consecution

In order to see the whole process of making a product from input to output I started with the very first stage – familiarization with the product line. Before making any order when choosing a product the customer usually starts looking for necessity, options, conditions, prices, advantages, disadvantages, quality and many other criteria. So, at first I went online to see what MagnetStreet offers there to their customers. There are many different types of products – greeting cards, sport schedules, save the date magnets, thanks cards, and wedding invitations. But the product I was especially interested in was the so called “memo board”. This is a 3.5" x 9" board with magnetic material on the back side. On the front side there is some space for making erasable notes with special marker pen included. After I chose that product type I was offered bringing some changes to the sample design. The customer is free to change the fonts, the colors and the picture. It is also possible to add or delete some elements of the image if necessary. Thus, after all the changes were made, I ordered my memo boards.

Normally the process of going from input to output takes less time. My order was special and it was important for me to see each stage of its production, so my product was purposely stuck on every stage to let me get familiar with it in details.

The next day after I made my order I was explained that at the very beginning all of them go to Minnesota office server. After processing the orders are sent to Customer Service department in Wheaton. Sometimes after a customer makes an order he or she realizes that something was done in a wrong way: the color, the font, the picture is too big or too small. By this reason after the order comes to Customer Service the PDF draft is done and sent to customer’s e-mail for confirmation. So, every time the order is in Customer Service it has 2 ways to go: directly to Pre Press department where it will be printed as a print draft or to Designers department if any changes are required to take place. In case if a customer requires some adjustments, he or she has options to send an e-mail to Customer Service, make a phone call or use a live chat to explain the request online. If everything is good and the customer successfully confirms the PDF draft – it goes to Pre Press department. The concept of printing a draft is pretty easy – different customers have different monitors at home or at work with different parameters of brightness, color depth, zoom and etc. So, even though the customer confirmed that the order looks good in electronic version on his or her screen, there is still no guaranty that there will be a right color, brightness and quality after printing. Consequently, the Pre Press department is responsible for printing first drafts of the order on a color printer. When the draft is ready Graphic Designers compare it to what the customer ordered with the help of special codes of colors, fonts and sizes. Then they make changes if necessary. If no problem acquired the order then is ready to go directly to the plant.

With a help of fast direct internet channel all the data from the Pre Press department travels to the plant servers. The computer in a huge printing room receives the orders from the office building and sends them to a big Xerox printer called “iGen4”. In order to save time and paper several orders are placed on one sheet, called “the run”. After this stage is completed plenty of runs are about to go through processing of two types – UV-code or lamination to make the product look better and last longer. As soon as this process is completed the runs go to the next room to a Heidelberg die-cutting machine to be prepared for detachment. Then, depending on the type of the order the product may or may not go to a machine called “the tabber” which puts magnetic cover on a back side of the product in case if an order was a magnet itself. The final stage is packaging. After the order is packed it is shipped to a customer by UPS shipping company – the MagnetStreet contractor.

III.  General Conclusion

After spending 4 weeks with Neville and his company I earned a wonderful experience through being shown all the details of business MagnetStreet makes. This is quite enough for me to make several key indicators of Neville’s company successful business.

First of all I find the managing policy very smart: small portion of huge business is easier to control. The company doesn’t pursue the regular growth of their business. MagnetStreet operates in an optimal rate of production. The second critical factor which makes big sense to me is the diversification and wide variety of products that can be designed with a great portion of individual features. While designing my personal product online I felt very comfortable with all the tool and samples I could simply use. The customer is offered a great number of options he or she can add or change while designing products online. This key peculiarity of MagnetStreet has the potential of satisfying any individual customer by creating unique products instead of making identical copies. Another important factor of success which I personally like very much is the internal atmosphere between the colleagues. Thanks to HR excellent work and Neville’s kindness friendly relationships between colleagues and openness in communication results in greater productivity, creation of atmosphere of trust and support. The offices on a top management level are glass-walled. The offices on lower levels are separated with cubical partitions and are also accessible and open to every co-worker. This makes everyone feel like they are a united team. People are not isolated one from another. More than that one of the Neville’s main rules of business is treating the employee well. “Take care of your employees and they will take care of your customers” is his golden rule. Neville pays a lot of attention to maintaining wonderful and friendly relationships with his employees on different levels. That’s why he finds very important to visit all the departments and the plant personally as often as possible. He never just sits in his office being very busy with phone calls and documentation. Instead, he regularly finds time to greet all the employees, ask about their families, joke or even invite somebody to have lunch with him. This impressed me a lot.

In comparison with companies in Kazakhstan I can make a reasonable conclusion that a very simple factor such as friendly and open relationships inside the company is often paid scanty attention. The heads of the companies are so much concentrated on external factors, the production, the profit and others, that they find treating their employees well insignificant. Managers very often discard their employees’ opinions thinking they are clever enough to take important decisions without communicating with lower levels. They treat people like “money making tools”. Some top-management representatives consider walking downstairs from their offices to a plant out of the limits of their dignity. Ordinary workers may never be allowed to walk in a top-management office. And by the way the absolute majority of offices in Kazakhstan are closed with walls and doors so people inside are isolated.

Another important point of comparison is defining the possibility of making the same business in Kazakhstan. Magnet business is not very popular in Kazakhstan. Here the magnets on fridges are used in majority of cases just for fun when people travel a lot and bring different souvenirs from different countries and put specific magnets on a fridge. Many people even have no magnets at all. But beautiful and attractive high-quality wedding invitations business can be very successful. People have the need of marriages all over the World. So, in this case it can be a very profitable business.  

2010 year

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