PROFILES IN BUSINESS: Joe Famolare and the Foreign Trade Zone

Vermont Business Magazine, Feb 01, 2004 by Marcel, Joyce

"We met at the Howard Johnson's up in White River Junction," Famolare said. "So I'm very impressed to be with the governor. He said, 'Why don't you move your place up here?'"

With the approval of the US Department of Commerce, Famolare built an energyefficient bonded building on Old Ferry Road, the first one in Vermont.

"I was able to bring in shoes in closed containers to a fenced-in area without paying duty," Famolare said. "I was able to save millions of dollars. Say I got 100,000 pairs in. Before, I would have had to pay, say, $5 a pair, or half a million bucks for duty Before the shipment even got on shore I would have to write the check to the government. By not having it unloaded, I didn't have to pay that $500,000. So I would ship, say, 20,000 pairs a week, and every time I shipped, I would pay the duty. But on the other 80,000 pairs, I didn't have to pay yet. So I would save that money."

In its heyday, the Brattleboro facility was shipping 30,000 pairs of shoes a day, the big time," Famolare said. Looking back, however, he said it "wasn't the

self the very next day.

"I hired one girl, and then I had an office, and then it started," he said. "It was hell. I went from having an organization where everyone takes care of you - you have somebody who does this, gets your reservations - and now I was all by myself. My family was in Italy. I went back to find factories to work with me."

During his final six months at Marx and Newman, Famolare had not developed contacts for his new business with factories in Italy and vendors in the U.S. because "it wouldn't have been honorable." So he had to build his new company from scratch.

"I found small factories to work with, and I'm designing the shoes, and working, working, working, but the moneys going out," Famolare said. "In a couple of months, I'm ready to go back to the US shoe shows, and I'm bringing all these shoes in that I designed."

His shoes were well received, but Famolare still had to sell them to buyers all over the country.

"The money is flying out, and I'm watching it go," Famolare said. "I'm on my second trip. I got all these shoes. Now, I know everybody, all the merchants. But I'm not part of a big organization. So I go to Seattle and San Francisco, and I'm selling, but I'm selling peanuts. I'm panicking. First of all, I couldn't get into the best hotels, because I have no oomph, so I'm in secondary hotels. And I look like a jerk, asking people to come to these hotels. I wrote my wife a letter: 'I'm sorry. I think it's going to take two years to dig myself out. I'm going to have to get a job. Because I don't think that I'm going to make it. I think I goofed.' I wrote that from San Francisco."

Famolare's next stop was Los Angeles and the Bullock's Dept. Store chain. He tried to book a room at the Beverly Wilshire, but it was full. Then the hotel offered him its luxurious presidential suite and Famolare grabbed it. He ordered in "a table like the Last Supper" and entertained about 25 buyers.

"As they're walking by me, I hear someone say to someone else, 'I thought this was a little guy,'" Famolare said. "They were so impressed. And I sold them 6,000 pairs of shoes. And bling! The lights go on. 'So I call Dallas and got the best suite they had, because I was going to see Neiman-Marcus. And I did the same thing. With money I didn't have. But I had charge cards. And that's how I started my business. I kept on going, and after the first year I was in the black, and we went to almost $100 million a year wholesale."