A Small Brand Tries to Escape the Confusing Shadow of a Big Brand





Hobby Lobby International makes and sells radio-controlled toys, tools and accessories. What started in 1964 as a shop in a building lobby in Brentwood, Tenn., grew into a thriving mail-order business and, later, an online retailer with $9 million in annual sales. The company was owned by the same family until 2003, when it was sold to a private equity firm. In 2009, Mark A. Cleveland bought the company with the goal of opening more stores and expanding its lines of radio-controlled products.

Challenge When Mr. Cleveland bought the company, he knew that it was frequently mistaken for Hobby Lobby Stores Inc., a national craft and art supply chain that is based in Oklahoma City and has more than 600 locations. The companies had a history of working cooperatively and, despite their common name, catered to very different consumers. “Roughly 98 percent of my customers are men,” said Mr. Cleveland, while most of the chain’s customers are women.

At its peak in 2006, the company had more than $9 million in annual sales and 36 employees. By the time Mr. Cleveland took over, sales had fallen to roughly half that amount. Still, he believed there were opportunities to grow by opening new shops and expanding the lines of remote-controlled products.

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