Entrepreneur Insight
How This Woman Entrepreneur Got on "Oprah’s Favorite Things"
By Angela Bao
Tenacity, a great idea and buying a warehouse led to this accessories company’s success.
It started with an offhand comment from her husband, Todd.
“Gosh, your purse is a mess,” he said when he caught a glimpse inside the bag he had bought her as a gift while traveling. As a mother of two young children at the time, Hardeep Melamed was used to throwing everything she needed in her bag, no matter how nice it was, and it indeed was “a mess.”
That prompted Melamed to do what everyone does: Google a solution. “I saw there was only one item that looked like a tool belt,” she says. “I said to myself, ‘God, there’s got to be something pretty, functional and all that,’ because women like me would buy it to organize my purse.”
Melamed’s solution was to design one herself, and thus, PurseN was born. Inspiration for every design came from problems Melamed was determined to solve. The original handbag organizer came from a need to easily keep her purse clean and transfer necessities from one bag to another. She designed a travel-friendly jewelry case (PurseN’s bestselling item) with clear, removable pouches after she found that her earrings and necklaces kept getting impossibly tangled. PurseN has also expanded into beauty cases, luggage and travel clutches. Most recently, Melamed revamped the flagship purse organizer into the LittBag LED, which has LED lights embedded inside so that users can easily find things in the dark (the LittBag made it onto "Oprah’s Favorite Things 2018"). Melamed, who serves as designer and CEO of PurseN, says that they now have about 50 different products, and after making Oprah’s list for the third time, the company is poised for rapid growth.
Embracing the entrepreneurial spirit
Success didn’t come rapidly to Melamed. PurseN was a project 10 years in the making—one that started in the basement of their home and now has grown to include their own warehouse fulfillment center.
Now, Melamed’s products are sold in over 2,000 retailers. Two of her other products, the jewelry case and travel pillow, had made it into O, The Oprah Magazine, but her dream was to see the organizer—the product that launched her company—in there, too.
“I swear, I tried everything,” she exclaims. “I tried hiring PR, but most PR companies are a fortune. I used to send them (Oprah magazine) things all the time, and nothing would ever happen.”
As fate would have it, Melamed was at a trade show one day when she saw Adam Glassman, creative director of O magazine, walk through the aisle.
“I look across and see an entourage of people coming down, and I just knew it was someone important,” she states. “I just walked over, stood right in the middle of the aisle, and said 'hi' to him. He says, ‘Do I know you?’ And I go, ‘Yup, you know me!’” Melamed got Glassman’s contact information and used that to develop a relationship with the O team, but it took a bit of time before she started seeing results.
“It took about two years to get our jewelry case on there,” she says. “It took us a few more years to get the travel pillows that she picked for 2016, but my dream was the organizer.”
Melamed’s tenacity and deep-rooted belief in her products eventually came to fruition. When Oprah finally picked the organizer, Melamed admits that she missed the first run and only barely made the second. She emailed Adam Glassman and asked if he could do her a favor and turn on the light in the organizer when he saw Oprah. “And he said, ‘Of course I’ll do that.’ And she liked it!” Melamed exclaims. “I had to come up and figure out production very quickly, but I made it happen—you don’t lose that opportunity. I can’t say, ‘Oh my god, I made the Oprah list,’ but I don’t have enough merchandise.”
Financial solutions for growth and success
One of PurseN’s biggest milestones was when they purchased their first warehouse, with the help of a real estate loan from East West Bank.
“Hardeep came into the bank asking for working capital only,” shares Cathy Huang, SBA relationship officer at East West Bank. “But when we reviewed her financials, we found out that the biggest expense she had was the fulfillment expense.” Because Melamed had started PurseN from the basement of her house, she was working with a third-party fulfillment center to warehouse and ship her products, which, as PurseN’s business grew, became quite expensive. Huang and her team crunched the numbers, found out that the cost of owning their own warehouse would be lower than working with a third party, and gave Melamed a real estate loan in addition to the working capital loan.
According to Melamed, buying the warehouse immediately saved PurseN 20 percent of their income. “When you’re shipping the larger orders at volume, it doesn’t work out,” she explains. “The rates are so high for a third party. Every time you do a $20 product, you’re getting charged $7 per product—it’s ridiculous. It doesn’t make sense, financially.”
Melamed adds that the warehouse purchase was a “pivotal moment” for PurseN. Not only did it help cut down costs, it also allowed Melamed to separate her work and home life.
“Without that warehouse, I don’t know if I would still be in business,” she admits.
PurseN also received a working capital loan to help support future product lines, which the company needs in order to continue growing. “She needs to continually come up with new products for new revenue to come in,” says Huang. “Hardeep does have a good chunk of retail business customers that continue buying products from her, but she needs to continue developing new products.”
With the financing and warehouse in place, PurseN is currently pursuing a variety of options to grow their business, ranging from developing new products, to partnering with bigger brands.
“We have a lot of access to different things because of the Oprah thing,” Melamed says, adding that she has already met with a team from the Super Bowl for a promotional product collaboration. “We’re trying to partner up with larger companies. We’re realizing that a lot of private companies do promotional products, and want volume and want certain products done.”
In terms of expanding the PurseN product line, Melamed mentioned that there were some new things still in the in the developmental stages. “We want to get through this year, clean up a lot of things, work on the LittBag,” says Melamed. “Since the light was so popular, I have another product that we can sell at mass volume—the opportunities, we realize, are in the mass volume.”
“I had to come up and figure out production very quickly, but I made it happen—you don’t lose that opportunity. I can’t say, ‘Oh my god, I made the Oprah list,’ but I don’t have enough merchandise.”
Getting the right partners
Melamed says that one of the biggest challenges her company faced when first starting was finding the right partners, whether it was manufacturers or employees.
“It’s really difficult to find a good factory,” she says. “Quality control is a big thing. Orders that are more detailed, most factories don’t want to work with that because they want to go quickly. It’s a learning curve—how do you get the right factories to support what you’re about?”
Once, Melamed had a factory owner ask her why she cared about her customers so much. It was at that moment she realized that she had to switch manufacturers. “I was like, my god, he doesn’t care about me,” she says, which prompted her to interview and hire another factory whose ethics she felt aligned better with her own.
Finding the right employees is also integral, especially for a small business like hers, adds Melamed. “I think every entrepreneur can say that the growth of the company also depends on the right team,” she states. “When you’re a young company, every person counts.”
However, Melamed admits that it can be difficult for smaller, growth-stage companies to find the right people, since they don’t necessarily have the budget to attract top talent. Nevertheless, she says to keep an eye out for certain characteristics in potential employees. “If they have passion to drive to succeed, to climb up the ladder,” Melamed believes, “they’re going to be right there with you. When you do find great employees, you’d be surprised at how much work you can do.”
Contact East West Bank SBA Team
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