About fifteen years ago, Helen of Troy Corp. hit the wall. Although the little-known company from El Paso, Tex., sold $10 million worth of beauty appliances to salon suppliers in 1981 and held 25 percent of its market, sales were Hat and there was no growth in sight. CEO Gerald Rubin knew he had to take some products to retail to create momentum.
The key to going retail, thought Rubin, was name recognition. Helen of Troy didn't have the money to launch a major advertising campaign, so Rubin searched for a cheaper way.
Acting on a tip from his father, a beauty industry wholesaler, Rubin went to Vidal Sassoon with a sweetheart deal: He'd give the company $100,000 up front and an above-market 10 percent royalty in exchange for its glitzy name.
It worked. Helen of Troy may still toil in virtual anonymity, but its products are everywhere -- in disguise. The company rides on the coattails of big retail players by setting up licensing agreements.
"If we had not gotten the name, we would still be a $10 million company," says Rubin, 52. As soon as the deal was signed, he pumped out a line of consumer hair care appliances labeled with the Vidal Sassoon moniker. The products sold like an old stalwart. Helen of Troy's sales grew twelve-fold over the next 10 years. In 1992, Rubin orchestrated a similar deal with Revlon, and soon products carrying the two...