CLEVELAND — Despite rising costs and inflation at every link of the supply chain, a Cleveland small business specializing in creative, fun and vibrant consumer products is not only surviving a difficult business environment but is thriving, too.
Born in his parent's basement in Shaker Heights more than two decades ago, Pulsar Products, founded by Eric Ludwig, has continued to expand, nearly encompassing the entire fifth floor at the Artcraft Building near East 25th and Superior. Employing nearly 20 team members, Pulsar designs and develops creative consumer products, including brightly-colored and boldly-designed notebooks, journals, stationary and other eye-catching items.
For many of the firm’s products, what its creative team conceptualizes eventually makes its way to market in 8 to 12 months, meaning Pulsar is already hard at work designing products for next year’s back-to-school season. Right now, however, the company is pushing one of its biggest launches — an entire display of sensory-driven, fidget-minded notebooks and journals — closer to its debut.
“It’s going to be a very colorful display. You’re going to see it in all the stores for under $5,” Ludwig, the company’s CEO, said. The display will be featured in nearly 2000 Wal-Mart locations across the region.
From concept to execution, the important product launch has been met with inflation constraints at every step.
On Tuesday, the U.S. Bureau of Labor Statistics released its August consumer price index report, which showed higher-than-expected inflation levels, rising to 8.3 percent year-over-year. Even the so-called ‘headline inflation’ rose 0.1 percent month over month, despite a significant decline in gas prices. Core inflation rose 0.6 percent month over month.
The inflation data, which ran contrary to what many economists and investors had anticipated, triggered a bloody day on Wall Street as stocks suffered their worst day since 2020.
The hotter-than-anticipated inflation report serves as a preamble for what will likely be another decision by the Federal Reserve to raise interest rates. That seemingly inevitable decision will have a tangible impact on small businesses like Pulsar Products, who often finance large inventory purchases months before receiving purchase orders.
“You have to watch the dollar a lot closer now — every step of the way,” said PJ Kijinski, the president of Pulsar Products. “It’s more expensive to get money. The higher that goes the more we’re paying for the money that we need to spend to lock down our inventory.”
That’s just one part of the inflation equation for Pulsar, however.
“The rising raw material costs, that’s affecting everyone. Material costs are up, transportation is up, just getting the product — the paper to our printers — is a lot more,” Ludwig said.
Kijinski said inflation has also been pervasive on the supply side of the business as the process of bringing products to market has become more tenuous.
“There are all these hands down the supply chain and they’re all trying to get a little more than they are used to getting because they need to get more to make up for all their rising costs,” Kijinski said. “There are 7 different companies that touch [a product] before it gets in the store. They all want more than they used to. So now it’s about having these negotiations every step of the way. It’s just tighter. It’s been a lot harder.”
Despite the challenges and obstacles at every turn, Pulsar has continued to grow. The company landed on the Inc 5000 in 2021, ranking among some of the fastest-growing private companies in the country.
“The life of an entrepreneur is not all up. There are moments when the world drops out from underneath you or containers get stuck at port. Those are not fun nights. It’s how we navigated it,” Ludwig said.
