'Knowledge' is power, when it comes to Long Isand textbook company

Long Island Business News, Jun 29, 2007 by Ambrose Clancy

The classic, even cliche success story starts in a garage and moves out and up. But Benjamin Conn went the other way.

Conn took his family's barely surviving business, Knowledge Industries, from a store in Brooklyn in 1994 to his father's garage in Oceanside. "Little by little, we grew this," he said, describing the book business he now runs with a staff of 35 in a 14,000-square- foot space in Freeport.

At any given time, KI's warehouse holds up to 250,000 volumes; last year, the company - which buys wholesale from the major American trade publishers and retails books to school districts - surpassed $7 million in sales.

Quite a leap from his parent's circa-1987 shop in downtown Brooklyn, which stayed afloat selling books, toys, games and videos to the public and to schools. After moving to the garage, Conn's first order of business was to focus on the largest and most accessible market.

"We immediately divested from toys, videos and games because we couldn't make any money with them," he said.

That left books, and Conn lasered in on the New York City Department of Education. The massive department of 1,200 schools and more than 200,000 students "buys more books than Barnes and Noble," he noted, and today, "we have the exclusive distribution rights (with the Department of Education) for eight of the 10 major American trade publishers."

Momentum was critical. A deal with one major trade publisher became a leverage tool with others, convincing them that the competition was putting books in schools and they would be left behind. In addition to the Department of Education, KI also has a stake, on a smaller level, in other school districts around the country.

Sometimes it's better to be lucky than good, but Conn believes in making your own breaks. So, in the mid-1990s, when education changed to a more standards-based model, Conn's company was ready to capitalize. More than ever, schools needed textbooks supplemented by trade books, and by securing more contracts from the big boys, Conn could fill the need.

"Outsourcing" is a dirty word for KI when it comes to growth strategy. "Everything we have, we have here on Long Island," Conn said.

The warehouse is part of company headquarters and all financial transactions are done locally. "We deal with people who can help us immediately," Conn added, recalling "a huge order that came in two months ago and we needed money right away, over my credit line."

One phone call to a bank executive he's dealt with in the past, and he had a positive response. "After hearing how much we needed, he said, 'You got it,'" Conn said. "It's all about relationships."

Todd Jones, sales representative for publishing giant Penguin Group, echoed that sentiment, noting KI works hard at establishing relationships with publishers and clients. He has known Conn for 10 years, Jones said, and from the beginning, KI "worked to find out what clients needed and found ways to give it to them."

Having the right person at the point of sale is crucial, Conn said, so each member of his eight-person sales staff is either a retired principal or senior educator.

"We don't walk into a school selling something," he said. "We go in and say, 'How can we help diagnose your problem?'"

That approach and expertise pays off, according to David Sweeney, a senior director of HarperCollins Publishers. "KI stands out as a company based on their extreme knowledge of the educational marketplace and promotional pieces that they create to promote titles in the classroom," Sweeney said.

Always thinking outside the garage, KI now has plans to go into publishing. "We're thinking of creating our own content," Conn said. "We'll write and publish our own books while we continue to represent and distribute books for other publishers."