Here’s Seung Soo Lim’s secret to success in a cut-throat industry: Set your prices low, offer quick service, speak the same language as your customers, and accept any size order, no matter how small. It’s not exactly a novel approach, but it’s one that has served him well. When Lim first set up his photographic supply distributorship, he couldn’t even get a paltry $2,500 worth of inventory from Eastman Kodak Co. without putting up his own, post-dated check as collateral. Today, Lim operates with a $500,000 line of credit. He represents nearly every major manufacturer of photographic chemicals, paper and film. And his company, Glendale-based Photo Max Film Supplies Co., is among the largest accounts for many of these manufacturers. “They’ve come from nothing to be very important to my paycheck,” says Charles Cailliez, a sales representative with Fuji Hunt Photographic Chemicals Inc., a subsidiary of Japanese film maker Fuji Photo Film Co. In the 13 years since it was founded, Photo Max has blossomed into a $6.1 million company distributing Agfa, Mitsubishi, Polaroid, Ilford, Champion, Kodak and Fuji products. The company’s customers include photo shops, police stations, hospitals, insurance firms and appraisal companies from San Diego to San Jose. To distribute all these products, Photo Max operates small, 1,000-square-foot warehouses in San Diego, Riverside and San Jose, as well as a 10,000-square-foot facility at its Glendale headquarters. Last month, Entrepreneur magazine and Dun & Bradstreet named Photo Max Film Supplies one of the top 10 minority-owned small businesses in the nation. Ask Lim how the company grew from that first, tentative partnership with Kodak to its current size, and he says simply, “door to door; face to face.” In fact, that homespun strategy proves ideal for the mom-and-pop retailers that make up the bulk of Photo Max’s customers. Before these small shops that offer one-hour film processing began to dot mini-malls in the 1980s, most people had their film developed at large drug stores. Film was sent out to large, regional processors, which could order supplies directly from the manufacturer. But the smaller retailers that do photo processing today, known as mini-labs, don’t have the financial wherewithal to carry large inventories, nor the luxury of waiting days for their orders to be shipped by United Parcel Service. They need local suppliers that do not require minimum orders and that deliver quickly like Lim’s Photo Max. “The biggest thing that separates Mr. Lim from most (distributorships) is they virtually hand-deliver every order that comes in,” said David Bell, West Coast sales representative for Mitsubishi Imaging. “He stays more in contact with his customer than anyone else I know.” In the beginning, Lim used his own car, “like Domino’s,” he says, to deliver shipments. These days, the company runs a fleet of five vans that deliver six days a week, and shipments still arrive the next day in most cases. Lim, who came to the United States from Seoul in 1982 to attend the University of Michigan at Ann Arbor, quickly tapped into the Korean community of mini-lab owners, independent groceries and convenience stores that sell film. Not only did these small-business owners want local service, they often required a supplier with whom they could communicate in their native language. “The market he was serving definitely needed a small distributorship,” said Lorie Babigian, district sales and service manager for Eastman Kodak, who advanced Lim his first inventory of supplies. The company’s volume is now large enough to allow Lim to negotiate lower prices from the manufacturers that supply the company. Photo Max also cuts corners on expenses. The vans the company operates are far more cost-effective than outside trucking or shipping services. And the Photo Max delivery team doubles as sales representatives, accounts receivable managers even technical consultants to help customers to troubleshoot processing equipment and other machinery. Then too, Photo Max works on significantly lower profit margins than most of its competitors. “Another distributor might have 15 percent profit,” Lim said. “We have 8 percent. We can take a smaller profit because we sell a lot.” In most cases, Photo Max passes those savings along to its customers. “I have to shop around to save money,” said John Ri, owner of KP Photo, a mini-lab in Santa Monica. “He seems to have a pretty good price on the products I need.” Indeed, the company’s growth is dependent on its ability to stay price-competitive and provide next-day service. The mini-lab arena is saturated, and pricing has become the central issue in the battle for business. At the same time, mass-merchandising chains like Wal-Mart and Thrifty have begun offering film processing services, usually at rock-bottom, loss-leader prices designed to get customers into the stores. Photo Max’s future is tied to the long-term prospects for mini-labs, and their ability to compete with the big chains. “I have to help my customers compete against Wal-Mart and the Price Club by giving them faster service and better prices so they, in turn, can give their customers competitive service and prices,” Lim said. Photo Max’s volume has more than doubled from $3 million five years ago. But Lim projects his volume over the next five years will not rise higher than $10 million. As with his founding philosophy, Lim’s approach for the next five years will be to keep it simple. “Slowly, one step, one step,” he said, “and I will make it bigger.” Spotlight Box: Photo Max Film Supplies Co. Year Founded: 1985 Core Business: Photographic Equipment Distributor Employees in 1993: 5 Employees in 1998: 10 Revenues in 1993: $3 million Revenues in 1997: $6.1 million Top Executive: Seung Soo Lim, President Goal: To work hard, provide good prices and treat customers in the best way possible Driving Force: The need for fast, cost-effective service