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SBA STATE EXPORTER OF THE YEAR
Hawaiian souvenir
ornaments take entrepreneur
on lucrative sleigh rideKaren Sotomura parlayed
By Peter Wagner
a 'cute idea' into a nationwide
multimillion-dollar business
Star-BulletinSHE hit the streets of Waikiki in 1985, a woman with a hunch and a handful of Hawaiian-style Christmas ornaments.
Fifteen years later, Karen Sotomura is head of a multimillion-dollar wholesale business and Small Business Administration Exporter of the Year for Hawaii.
"Everybody thought my idea was ridiculous," said Sotomura, president and founder of Joseph K. & Co., a small Kakaako business with a solid grip on the nation's multibillion-dollar Christmas industry.
"Even my husband said, "Well, it's a cute idea but I don't think you'll get very far.'"
The company's colorful "Hawaiian Poi People" wall magnets, "Aloha" Santas and personalized ornaments today are in thousands of shops and malls across the country. And husband Joseph Sotomura, a former financier with a Harvard MBA, is now chief financial officer in the fast-growing family business.
Karen, the "K" in Joseph K., is to receive her award at a luncheon at the Sheraton Waikiki today, the latest in a series of honors since she began knocking on doors with her little felt display tray in Waikiki.
In a tall cabinet behind her cluttered desk are other awards, including 1995 Small Business Person of the Year and 1997 Ernst & Young Entrepreneur of the Year.
Sotomura came upon the idea of Christmas ornaments while visiting Maui with relatives in the early 1980s. Noticing a lack of souvenir ornaments -- the kind her family likes to collect on trips -- she set about filling the void.
The hand-painted resin ornaments, designed by Sotomura and made to order in Asia, caught on in resort shops from the start.
"It was a 100 percent response," she said. "I knew I was on to something."
Sotomura took in $40,000 in orders in her first weeks out, still without an inventory and hoping her first shipment would arrive from Bangkok in time.
"This is where the optimism comes in," she said. "I was taking orders on something I was pretty sure was arriving."
Sotomura proved her mettle in those formative months, moving into the unknown with everything on the line -- including an in-law's house.
Making deliveries with her daughter Joanna -- then a toddler and now 13 -- along for the ride, she masqueraded as an employee of the impressive-sounding Joseph K. & Co., a name she dreamed up to hide behind.
"I didn't want people to know the company was only me, that I was the office and the warehouse and sales and delivery," she said.
Joseph K. ended its first year in the black with sales of about $85,000, a business that has grown an average of 30 percent each year despite Hawaii's economic stagnation of the 1990s.
The Waimanu Street company now has 13 full-time employees and up to two dozen seasonal workers. It was because of Hawaii's economic doldrums that Sotomura reached out for mainland markets in 1990. Tailoring its products to visitor destinations like Las Vegas, Atlantic City, and Aspen, Colorado, Joseph K. today makes 90 percent of its sales outside of Hawaii.
About five years ago, the company launched "Santa's Pen," a highly successful retail concept in which Christmas ornaments are sold from vending carts in shopping malls. About 150 of the privately operated carts are expected by the end of this year.
Meanwhile, Sotomura plans to unveil a new line of specialty gifts at Ala Moana Center this year.
"There's much more out there as far as market share," she said. "There's new markets and niches."
