czechcrunch.cz - "He is learning to swim in the bookbinding business. From bankruptcy, the Czechs have gone on to book contracts for Marvel and Netflix."
20.2.2024 _ czechcrunch.cz
Book and paper manufacturing may not sound sexy, but the Paters have built a company that is among the top in the industry. Now they're gaining strength in the European market.
When architect Martin Patera decided in 2011 to dive into the bookbinding and papermaking industry and start making custom boxes, he probably had no idea how much his future business would be comparable to riding a roller coaster. In 2017, the business took a very promising turn and Martin's wife Jitka joined in, and together they went through numerous tests of nerves that led to the bankruptcy of their company. But the Pateros have one thing in common: failure does not mean it is time to pack it in. They got the company back on its feet and a few years later were doing work for Netflix, Marvel and Google. Now they have teamed up with Moravia's Hospa and Sweden's Profilskaparen to create what they say is a player unparalleled in Europe for bookbinding, printing and paper packaging.
Martin Patera did not originally go into production, but worked as an architect. However, as it sometimes happens, an interesting opportunity to try a different field presented itself: in 2011, he and his business partner started to produce laboratory boxes. According to him, although they were not very good in this field, they managed to build a self-sufficient business under the Haptic brand.
"In 2014, we received an offer from Andreas Wigerman from Profilskaparen, a Swedish company specialising in paper packaging, to produce a technically complex product for him. The order was a success, and others followed, for example for Volvo. The advantage was that the Swedish company had a lot of major brands among its clients, so we dove in headfirst and immediately produced packaging for major clients," says Martin Patera.
As the company grew, so did the team, and 2017 saw the first major breakthrough. Patera came across an opportunity to buy a Swedish bookstore that was part of the large book and paper brand Hässlers. So he moved four trucks of bookbinding equipment to the Czech Republic, which was at a time when his wife Jitka, who was focused primarily on developing the brand and communications strategy, started helping him build the company. They were preparing to be able to significantly expand their field of activity and increase their turnover, which at that time was around 25 million crowns a year, thanks to the new equipment.
"At that time we got a great job for H&M. They wanted to include paper products like notebooks, folders, binders and so on in their stores around the world. And they were looking for a manufacturing partner. The tender took about six months and we won, so then we started to design and develop the products together technologically. Thanks to that, we got a lot of momentum and recruited a lot of new employees," says Jitka Paterová.
However, in the spring of 2018, H&M found out that the range wasn't selling well, and they made short work of it - they stopped production and terminated their contract with Haptic. The Paters initially tried to save the company, but after three months they decided that the best solution was only insolvency. But they did not want to lose their good relations with suppliers or their partnership with Profilskaparen, and they refused to lay off all the people who worked for them. So they sold the properties and borrowed from family, which enabled them to pay off a large part of their debts.
"Of course we talked about letting it go. But we knew that thanks to the partnership with Profilskaparen we could continue to place orders for key clients. The financial commitment to the family also played a role. We knew we needed to continue in business, we wanted to wipe out the debts as soon as possible. And we wouldn't have been able to do that if we were employed somewhere," says Paterová. So the couple didn't stop even after the rough experience, they had to recover quickly and figure out how to get the business back on its feet.
Again and better
The Haptic brand thus ceased to exist, but the Paters did not hesitate for long and in January 2019 bought the Swedish brand Hässlers. They even managed to do so from a direct descendant of its founder Knut Hässler. Indeed, the company, which was founded in 1902, rose and fell over the years, merging with other brands, rebranding itself, until it found itself on the verge of bankruptcy. The Czech entrepreneurial duo ensured that, after more than a hundred years of tradition, the Hässlers name did not disappear from the paper industry, but moved its base to the Czech Republic.
The well-known name was particularly important for the Swedish market, where the brand had long been established. But then came another shock: a pandemic of covid and with it a complete decline in sales by the Pateras' business partner, Profilskaparen. Turnover, which had managed to reach 12 million in 2019 after the hardships of the previous years, dropped to eight million a year later. It was necessary to pull the rescue brake before it was too late again. The Paters sold their apartment, moved into a rental, and that gave them the funds to keep the business and employees running.
But everything bad was good for something. "At that time we took a crucial step. Jitka and I were talking one evening about what we were going to do - whether we should close the company for good or continue the business. And Jitka suggested that we could focus on the Czech market. That there must be clients who would be interested in our products. Moreover, it was clear to us that companies would want to communicate a little differently during a pandemic, that they would want to take the experience home to people when the shops were closed. And the product experience starts with the packaging," says Martin Patera.
Thus a period of what could be described as door-to-door selling has begun. Martin Patera took a box with a sample of the best products and went from agency to agency. And it worked. New clients began to arrive through Czech and English marketing firms, including Google, Rimmel and Marvel. For the latter, they prepared 128 large boxes for the launch of Marvel's Midnight Suns video game with twenty engraved cards. The boxes were sent to influencers around the world and were expected to have great collector value.
Hässlers has created special boxes for Google within a deadline of one week. "It's our curse, but also our advantage." Slightly less gallows, but all the more spectacular, was the 700 scripts for all the actors, actresses and the entire crew of Deliverance 2, which was filmed at Barrandov in Prague. The scripts were sewn in leather bound books and each had the name of the recipient stamped on it.
"After the end of the pandemic, everything unstuck and orders started pouring in. For example, we got a fintech client for whom we did 400,000 credit card covers. That's where we're very different from our competitors - we have a very broad product range built on the bookbinding craft. We never say we don't do something because we know how to combine suppliers and how to add value to the result," explains Patera. Thanks to the new clients, they have surpassed an annual turnover of 20 million after 2022, and the ratio of sales from the Czech Republic has equalled those from Sweden.
Like building a plane in flight
Now, at the beginning of 2024, Hässlers is once again at a turning point, with the Moravian company Hospa, largely backed by entrepreneur Pavel Rada, also involved. Hospa has been in the paper business since 1895 and has become an important partner for the Paterovs over the years. Now it has come to pass that one company from Bohemia, another from Moravia and a third from Sweden have agreed to unite under one brand Hässlers CZ for the benefit of all.
"We are now at a point where everything is hot and everything is a complete mess. But each of us can bring our experience and technology to the table. Hospa has enormous potential that it is failing to harness despite good management, and we can do that. We have the spirit to do it and a great network of suppliers and clients. Profilskaparen, on the other hand, has top-quality customer service and many years of experience in the highly competitive Scandinavian market. Together, we can target an annual turnover of around SEK 100-120 million. We are building the aircraft on the fly, which is what we are used to. The crucial thing for us now is to organise the Prague, Bystřice, Stockholm axis," smiles Martin Patera.
The couple are counting on the fact that they have now succeeded in creating a unique brand within Europe. They are one of the few on the old continent to specialise in certain technologies and, when comparing quality and price, they say they would be hard pressed to find competition in Europe. Moreover, the history of their business proves that they do not shy away from any job, no matter how crazy.
Perhaps that is why Martin Patera says with a smile that they constantly oscillate between creativity and madness. With this approach, they want to focus more on the European market in the coming years. They believe that with the Hässlers CZ brand, which combines Swedish tradition with golden Czech hands, they also have great potential in the UK, Germany or France. So the Pateras will probably prepare a box of products and start knocking on doors again, but this time of foreign marketing agencies.