Schurman Retail Group: Crafting a real paper success

  @FortuneMagazine August 29, 2013: 7:39 AM ET
VEN16 papyrus schurmans

The Schurmans at a Papyrus store in San Francisco's Embarcadero Center

(Fortune)

When Marcel Schurman, now 87, left his home in Switzerland to work in London after World War II, he had no idea he would meet a beautiful Jewish refugee from Germany named Margrit, now 88. The two fell in love, and when she decided to emigrate to the U.S., he followed, and they got married. Soon after, working out of their Berkeley apartment, they started a small business importing art cards from Europe. Today the Schurman Retail Group owns Papyrus, Carlton Cards, Paper Thread, and the retail stores of American Greetings, making $200 million in sales in 2012. Their story:

Marcel Schurman: I was born in Switzerland, and our family grew up in very modest circumstances. My father was a small wine distributor, and my mother was a housewife.

Margrit Schurman: I grew up in Germany, the third of five children. My family had a retail business of exclusive furniture and Oriental carpets.

Marcel: When I was a young man, I had a big urge to see the world. I grew up during World War II, and it was impossible to travel. Switzerland was encircled during the war years, and we feared for our lives. We decided that a background in business would be helpful wherever we lived, depending on the outcome of the war.

Margrit: In 1938, I left Germany with two of my younger sisters, and spent the next few years in a boarding school in England. It was the Hitler period, and I'm of a Jewish background, so I couldn't go to school in Germany anymore. There was no contact between our family members, and I got used to the idea that life isn't simple, and you have to put up with things you don't like.

Marcel: I left school at 15, and looked for an apprenticeship. I worked in a small family company for three years and was exposed to all areas of business. In the evenings I went to business school. When the borders opened up in 1947 after the war, I found a job in England and started learning English.

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Margrit: I was living in a boarding house, and met Marcel, who came to live there too. I did secretarial work for a cousin in the Oriental carpet business, and discovered that creating a business isn't all that difficult. My sisters and I then decided to go to the United States for more opportunity.

Marcel: We were in love, and I decided to follow her. After she left, I went back to Switzerland to earn some money, and in 1948 got my visa to the United States. I came to Berkeley, Calif., with big hopes, big dreams, but very little money. I was 22, and my English was very poor. I eventually got a job working for a construction company, where I did clerical work. She worked for an import-export firm. I made about $200 a month, and she made maybe $500 a month.

Margrit: I got a master's in art history at the University of California at Berkeley, and also taught for several years in the Berkeley area.

Marcel: We got married in 1949. She was used to buying greeting cards in England and was unable to find the kinds of cards she liked here. So she imported the cards for our personal use, and we got the idea that others might be interested as well. The cards were art reproductions of paintings and fine art, which was novel at the time, made with finer-quality paper.

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Margrit: The art prints were the size of credit cards, and I'd adhere them to plain white stock with rubber cement. Those were our first greeting cards. Later we imported finished cards from England and Europe. It was quite an exciting time.

Marcel: We launched the Marcel Schurman company, and in 1951, I started going from store to store to see if people would buy our cards. Back then, the market was dominated by Hallmark, Norcross, American Greetings, and others. It wasn't easy to find customers. At the time, I didn't know how to drive, but I learned, and bought a secondhand car. I'd set out every morning with my lunch, and try to find customers. I used the Yellow Pages to look up the gift shops and bookshops. Little by little, the business grew. Our first year's revenue was $20,000.

Margrit: Then one of my sisters lent us $2,000 for a down payment to buy a house in Berkeley, and we had our first baby. We moved our merchandise from the dining room of our small apartment to the basement of the house. We had no furniture in the house for the longest time. I remember when we wanted to go to the movies, we would go through our pockets to see how much loose change we had. If we had enough, we'd go. If we didn't, we wouldn't.

Marcel: It was difficult to get a bank loan because we didn't have any collateral. We'd been in business seven years when a friend co-signed for a $10,000 bank loan. That allowed us to go to Europe to attend some trade shows, where we got to work with many new suppliers. We were able to move into newer greeting cards, wrapping paper, and stationery. We reached our first million dollars around 1961. By 1965 we had a few employees and a warehouse, but we were still a small operation.

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Margrit: In 1973, I needed to do something more on my own, so I opened a small store in Berkeley to sell our line of products. Paper was made from papyrus in ancient times, so I named it Papyrus. It cost less than $1,000 to open. Imagination is what is important. I took some plywood, leaning it at an angle up the wall, popped the cards on it, and held them back with fishing wire so that whole images would show, like an art gallery of cards. I had a counter made of cedar that gave off a lovely smell. It was an immediate success because of the sophisticated feel. There was nothing else like it.

Marcel: People stood in line to get in. Before that, we were sold only in independent gift shops because the big card companies controlled all the rack space in larger stores. I ran the wholesale business, and Margrit ran the retail business.

Margrit: I kept opening stores here and there, and eventually started opening them across the U.S. I took care of the creative end, and someone in the company would take care of the bookkeeping and finances.

Marcel: It was always a challenge to divide the money between the wholesale and retail. But little by little, we poured the profits back into the business, had credit with our suppliers, and managed both.

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Margrit: Around 1978 the stores were doing well. I wasn't really interested in franchising, but the company moved forward with it. Once we started selling franchises, I became the one to look after them.

Marcel: In the 1980s we hired more salespeople and had showrooms around the country. By then, the annual revenues were just under $10 million. We began domestic production of products under the Papyrus name and began to offer a wider range of items, introducing new things from Europe and Japan. In 1991, I retired at age 65, and our youngest daughter, Dominique, took over. I'd worked since the age of 15, and thought 50 years was enough. I was always interested in sculpting, so I work in stone and alabaster now.

Margrit: I retired from Papyrus in 1999. Finally, after all the struggles in my life, wartime London, boarding schools, I had something I'd built and really loved. Right after the younger generation took over the company, I'd go into a Papyrus store and criticize something in my mind. But since I wasn't handling it anymore, I decided to focus on something else. It's counterproductive to hold on when something is no longer yours. So I started an online business called Scriptum.com, which sells Japanese prints.

Marcel: I'm very proud of our company. It's not the biggest, but I think it's one of the best. I believe that the greeting-card business will undergo more changes, with the Internet and use of e-cards, but it will adapt.

Margrit: People still want something they can touch. Having something you can put on the nightstand when you're in the hospital is different from getting an online greeting.

Marcel: I don't think greeting cards will go extinct. Eventually, all of us will be extinct, but good taste and quality will always have a place in people's hearts.

Our advice

Be driven. You have to focus your energies and be crazy about what you're doing. In the beginning, we worked out of our house; the baby would sit in a chair and watch us work.

Be a quality operation. Our products had a high standard of quality and design, and we made sure that customer service reflected that too.

Be frugal. We never had lavish offices, and while we had Christmas parties for our employees, they were never lavish. Even today we continue to live in a modest home.

This story is from the September 16, 2013 issue of Fortune. To top of page



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