Fast Track

Fast Track/22/dp1st/mark2nd Moulton Logistics Management Year Founded: 1968 Core Business: Providing warehouse space and distribution services for companies Revenues in 1997: $3.8 million Revenues in 1998: $6.5 million Revenues in 1999 (projected): $8.4 million Employees in 1997: 60 Employees in 1998: 100 Top Executive: Larry Moulton, president Goal: To grow the business until Moulton can retire and turn it over to the employees Driving Force: The need for storage space among catalog and e-commerce retail firms By JENNIFER NETHERBY Staff Reporter Eight years ago, the people selling “Veg-o-matic” food processors asked Larry Moulton if he had any extra space at his Chatsworth warehouse to store a couple thousand of the devices. They already were using Moulton’s firm for general mailing services, and hoped he might help them store and distribute their popular product. Moulton seized the opportunity and since then has carved out a profitable niche providing warehousing and distribution space for a slew of products sold mostly through infomercials, catalogs and the Internet. In the process, Moulton Logistics Management has distinguished itself in the crowded warehousing business by becoming an all-purpose option for companies that don’t want to invest in expensive storefront operations. “You don’t have to get a building, hire a crew, or create a system until you find it’s a proven product,” Moulton says. “We do that so efficiently, you wouldn’t want to bring it in-house.” Revenues in 1998 were $6.5 million a 71 percent jump over 1997 and Moulton believes that figure will increase even more as e-commerce expands and firms seek warehouse and distribution services for products. To accommodate that demand, Moulton has moved to more expansive digs in North Hollywood, where he now has 85,000 square feet of space and plans to look for even more soon. Among his current clients are Warner Bros., which contracts to handle studio merchandise, and Epson America Inc., which sells printers. Moulton also works with a number of e-commerce companies, which he believes are loaded with potential. “The Internet is really going to heat things up,” he says. “Someone can start in business, like Amazon.com, and not even have a retail store.” MXG Media Inc. was one of the first online companies to sign up. Through MXG, its online catalog/magazine, the firm markets products aimed at teen-age girls. Chief Executive Stuart MacFarlane says outsourcing distribution is important to his firm. “It allows us to focus on our core business and outsource the (distribution) business we’re not good at,” he says. “We are growing very quickly. With Moulton and other warehouse companies, we can put our resources into the front end and marketing sides rather than spend resources on the back end.” Moulton Logistics Management was started in 1968 by Moulton’s brother, Bob, as a computer reselling business. During its first year, the brothers sold computers (with 4,000-word memories) to small firms. Bob Moulton left after that first year because the company was losing money. But Larry Moulton continued, using rented computers to do data entry first for newspaper subscriptions and then for mail telegrams. The company plugged along until 1982, when Moulton decided it was time to get serious about making money. He mortgaged his house to get capital and expanded the company to do mass mailings and provide mail labels and distribution lists to clients. “That’s when I made the commitment and bought the first computer,” he recalls. As the company grew, it moved to a 15,000-square-foot warehouse in Chatsworth. It was there that Moulton was approached by Ron Popeil, who founded Ronco, the maker of the Veg-o-matic. Popeil asked Moulton if he could begin storing and shipping the device. Next came calls to store “Dream Away” diet pills, a food dehydrator and a host of other gadgets, gizmos and products that were being sold on-air. “That got us handling products,” Moulton says. “That finally got us our niche.” Moulton soon turned the company into a full-scale warehouse and distribution center. Along with the makers of infomercials, he recruited firms doing catalog and Internet sales. He now offers inventory, printing, packaging and other services. “We’re doing more than just shipping things out,” he says. “We’re proactive with customers. We help them project the amount of product they’ll need, and we know where everything is all the time.” Moulton says one of his biggest challenges is gauging how quickly client companies will grow and making appropriate space allocations. Securing space for a client that quickly goes out of business could be a major blow. But on the other hand, hooking up with a fast-growing, e-commerce client could have huge benefits. “This has the potential to go off the charts.” Moulton says.