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LONG LAKE, Minn. -- By his early 30s, Mark Hanson had built a $2 million-a-year lighting business -- and he wasn't making a dime. Hanson, a Golden Valley native and Mankato State University grad, "stumbled on the idea of deck lighting" while working as a brewery rep in college. (We don't know whether the stumbling was literal or figurative.)
He raised seed money, put together a lighting kit that won industry awards and started selling it to big-box stores, thinking he had it made.
Wrong.
"The big-box retailers would tell you what they were going to buy, how much they were going to buy and how much they were going to pay," said Hanson, now 42. He was killing himself to meet his clients' demands while seeing his margins constantly erode.
In 1995, Hanson sold his business and took a year off to make new plans. As he thought about the business, he realized that he wasn't really selling light fixtures; he was selling lighting effects. It was the look that mattered, not the equipment.
Hanson started a new company, Touchstone Accent Lighting. He employs 14 people and expects to hit $2 million in sales this year.
Meanwhile, he's building a network of landscapers and irrigation contractors whom he trains to install outdoor lights as add-ons to their existing businesses.
Hanson and his wife, Lisa, recently bought a 20,000-square-foot building in Long Lake and created an 80- by 50-foot indoor display area, with 20-foot ceilings, to show their lights in nighttime conditions.
A brook babbles through the display, showing how to light water features. Trees are lit from above and below; shrubs and decks show a half-dozen lighting options, and seven different house facades demonstrate the looks on brick, wood or stucco.
"You're here to see what the effects look like at night," Hanson said, "not what the lamps look like during the day."
Lisa Hanson quit her job as a legal administrator to join the business, handling finances and helping with sales. "We wouldn't have been able to see each other if I didn't join him," she said.
The couple's efforts tie in with an overall trend toward enhancing outdoor home spaces. Landscaping, paver sidewalks, retaining walls and water features are surging in popularity, creating opportunities for outdoor lighting.
Hanson offers a two-day course in "illuminology" to landscapers, irrigation contractors and electricians who want to expand into lighting installation. He also has built partnerships with contractors in Sunbelt states, helping him smooth out the seasonal peaks and valleys.
He designs his own fixtures and has them manufactured in China, allowing him to be involved in every step of the process.
"Everything here is about keeping control," said Hanson, who vows never again to be at the mercy of the mega-retailers.
"It would have been very easy to put on a few manufacturers' reps and go out and load up wholesalers with product," he said. "But I wanted to get out of wholesaling. Instead of selling four lights for $60, I want to sell 10 lights for $2,000."