An indelible imprint Over 125 years, Schwaab has bounced around from coins to rubber stamps

Milwaukee Journal Sentinel
Milwaukee Journal Sentinel (WI)

October 9, 2006

An indelible imprint Over 125 years, Schwaab has bounced around from coins to rubber stamps



Author: RICK BARRETT; Staff

Edition: Final
Section: D Business
Page: 01

Wauwatosa — There was a time when Schwaab Inc. engraved coins for the U.S. Mint and made license plates for every county in Wisconsin.

It also made dog tags and some of the fanciest police and fire department badges in the nation.

Fast-forward to the present. The 125-year-old company still sells police badges, but they’re made by someone else. It no longer engraves coins or makes license plates, but it is one of the nation’s largest manufacturers of rubber stamps.

Ubiquitous stamping devices have become the company’s main business. There are about 2,500 stamp makers in the United States and Schwaab is one of the biggest, with six manufacturing plants and roughly $20 million in annual sales. Besides rubber stamps, the company makes embossers, name badges, business cards and other products. Even with Internet-based sales, it still has 100 salespeople who make door-to-door calls on clients such as banks and law offices.

"On a national level, there’s us and about three or four other players," said Douglas Lane, president of the family-owned company.

Schwaab’s roots here are deeper than Harley-Davidson’s, although Harley gets more attention.

The company was founded in 1881 as Northwestern Stamp Co. by Andrew Schwaab, who moved to Wisconsin from New York as a boy and worked in his uncle’s furniture store on National Ave.

The stamp company moved several times in downtown Milwaukee in the late 1800s and was the scene of a deadly fire on Feb. 3, 1903.

From the company’s account of the fire: "Certain acids were used in the business for cleaning and plating metal. An acid drum exploded and, instead of the flames being doused with chalk to neutralize the acid, sawdust was mistakenly thrown on the fire, serving only to increase the blaze. Five firemen, one of them being the chief, died in their attempts to bring the disaster under control. Forty others, it is said, were sent to Hot Springs, Ark., and other health spas to recover from inhaling the acid fumes."

That was probably the company’s darkest day. It went on, without major industrial accidents, to produce coins for the 1904 World’s Fair, in St. Louis, and an array of other products, from badges, tokens, ashtrays and medals to dies, stamps, stencils and seals.

At one time, Schwaab was the world’s largest manufacturer of watch fobs. The company made Wisconsin license plates until about 1918, when the business was awarded to the state prison at Waupun.

Up until 1918, license plate numbers were riveted on individually. Afterwards they were embossed.

In 1958, Schwaab struck a deal with S.C. Johnson & Son of Racine that would change the course of Schwaab’s sales. Johnson Wax had developed and patented a new product, called Porelon, that could be used to manufacture stamps that required no ink pad.

Porelon was a combination of ink and plastic that would not dry out, produced about 25,000 imprints, and came in different colors.

"That’s where we earned a national presence," Lane said. "It was something new."

A company this old has many colorful stories, such as the time when two employees loaded a horse-drawn wagon with stamp-making equipment and traveled through the Midwest soliciting orders one day and making stamps on the wagon the next day.

For 50 years, Schwaab had a downtown delivery man, Egbert Roth. Some of the company’s metal engravers also worked for the company a half century.

During World War II, Schwaab made stencils for the U.S. Army and Navy. Later it made signature stamps for athletes, including boxer Muhammad Ali, and entertainers such as Liberace, born in West Allis.

The company still makes signature stamps for athletes and entertainers, although it doesn’t reveal who they are.

Some items from China, India

Schwaab has 300 employees. Besides making its own products, the company imports some stock items from China and India.

The low cost of doing business in China was "sort of a wake-up call for us," Lane said.

"Just to change the top of a mount on a stamp cost $60,000 to $90,000 in tooling in the United States. To get a whole new mount, in China, cost $6,000 in tooling... and frankly the quality has been every bit as good."

In the last five years, Schwaab has acquired smaller companies at the rate of about one a year. It’s in a mature industry, Lane said, and acquisitions are the main way to increase market share.

"You either have to take business from someone else or buy it. To take it probably means triggering a price war. In many cases, you are better off buying your competition," Lane said.

Quick delivery in West

The company has done well on the West Coast, where its plants and subsidiaries can quickly deliver products there.

"A lot of the contracts with big companies specify a 24-hour to 48-hour turnaround on orders," Lane said. "Do they really need the products that fast? Probably not, because often they’re left in a mailroom for a week before getting moved inside.

"But in our business, the big companies have the clout" with suppliers.

It doesn’t cost much to establish a rubber stamp company, less than $100,000 for a small, first-class shop, Lane said. That’s probably why there are still several thousand companies left in the industry.

"If a guy decides he wants to be an entrepreneur, he could set up a shop in his garage," Lane said.

But the number of stamp manufacturers is declining, said David Hachmeister, publisher of Marking Industry Magazine, a 99-year-old trade publication based in Elmhurst, Ill.

"There’s been a great amount of consolidation in the industry, particularly in the last six or seven years," he said. "There are probably half the number of manufacturers."

The number of stamping devices being made has stayed about the same, but it’s certainly not growing.

"For every new application we find for stamps, it seems there are 10 others that are disappearing," Hachmeister said.

Skipping the middleman

Schwaab’s strategy is to sell its products to the end users, such as banks and law firms, rather than chain stores such as Office Max and Office Depot.

"We made a decision that we didn’t want to go where we would have to kill ourselves over pricing," Lane said.

The company is still 100% family-owned. Lane, one of the owners, has managed the operations for 10 years.

"I am constantly looking for acquisitions. It consumes a large portion of my time," he said.

Schwaab has expanded its product line to include things such as lighted signs and screen printing. In most cases, sales of ubiquitous rubber stamps and business cards continue to do well even in a recession.

"Our average sale is about $60. People generally don’t tighten their belt to that notch," Lane said.

125 Years Schwaab Inc. (and its precursor) has been around

100% Family-owned

$20 million Annual sales

6 Manufacturing plants

100 Salespeople who make door-to-door calls on clients

$60 Average sale

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Record Number: MERLIN_8388711