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Minnesota Company Helps Consumers Deck the Halls

December 13, 1995

CANNON FALLS, Minn. (AP) _ Angels come and go. So do snowmen and nativity scenes.

For people who make their money off holiday ornaments, Santa is the one sure thing that never goes out of fashion, says Kathleen Brekken, chief executive officer of Midwest of Cannon Falls.

``You can do anything with Santa. He can ride a fish, he can be an angel, he can be a pig. The American public loves it when you take Santa and do all kinds of weird things with him,″ Brekken said.

Brekken ought to know. Midwest, located about 40 miles southeast of Minneapolis, is one of the major players in the Christmas ornament industry. The ornament wholesaler did about $85 million in sales last year to stores.

Midwest has 5,000 items in its product line, with suggested retail prices ranging from $2 to $500. About 60 percent of the line is Christmas merchandise.

There are hundreds of hand-painted European blown glass ornaments, limited edition nutcrackers from Germany, folk art from U.S. woodcarvers and lighted porcelain villages celebrating America’s heartland and the Easter and Halloween seasons.

Next year, vintage Disney, Warner Bros. and Winnie the Pooh ornaments will be added to the line.

``We still say with a laugh that we don’t sell anything that anybody needs,″ she said. ``But it’s an emotional thing, an impulse buy. I would guess that well over 50 percent of what we sell is for the person buying it.″

The company’s more than 20,000 active customers include Saks Fifth Avenue, Nieman Marcus, Nordstrom and Dayton Hudson department store chains, catalog gift companies and small gift shops.

``I think they have a niche in the market,″ said Sharon Hutchinson, a senior buyer for 60 Dayton’s, Hudson’s and Marshall Field’s department stores.

Most of Midwest’s products are manufactured in China, Brekken said. The company also has staff in Taiwan, the Philippines and Hong Kong and has a British subsidiary, Midwest Design, outside London.

``We’re a small Midwestern company, but what we do is international,″ said Brekken, whose company maintains permanent showrooms in 15 U.S. cities and in Ontario, Canada.

Midwest’s most expensive items are large, limited edition German nutcrackers sought by collectors. If one of those pricey nutcrackers falls from the mantle and breaks its sword or cracks its crown, not to worry. Midwest has its own repair and parts replacement shop that will fix it.

One of the company’s biggest sellers this year is a folk art nativity set designed and crafted by Washington state woodcarver Eddie Walker, then reproduced in resin and hand painted.

A few years ago, patriotism was a big seller.

``Anything we did in red, white and blue was hot. When the Persian Gulf war erupted, it was even hotter. The day the war ended, the trend ended. The bottom fell out. We couldn’t give the product away,″ Brekken said.

Midwest, which employs just over 400 people in Cannon Falls, was started by Brekken’s father, Ken Althoff, in 1955 as a one-room gift shop specializing in religious items.

Althoff’s daughter and son, Bill Althoff (now vice president of international operations), joined the company in the early 1970s and later bought out their father. Ken Althoff still serves as board chairman.

The company, then called Midwest Importers Inc., had its first growth spurt after it entered the secular gift market in 1973 and began focusing on Christmas products.

In 1982, with annual sales of $10 million, Midwest began designing its own items rather than buying products available on the open market. Within three years, sales had nearly doubled and have been climbing steadily since, Brekken said.

Although the company has ballooned in size, it retains its small-town flavor. Brekken and her employees address each other by their first names, and many employees have remained with the company for years.

``This is a design driven company. They’re very careful about not squelching the creativity,″ said designer Ceal Bialobrzeski, who has worked for Midwest for 11 years.

From its 192,000-square-foot distribution center across town, Midwest ships about 2,000 cartons or $500,000 in merchandise per day to customers. Most customer orders are filled within 48 hours.

If you think that amount of cute little decorations has dulled Brekken’s love for the products over 22 years, think again.

``Every year when you think you can’t stand it anymore, you see all the new product and get all excited again,″ she said.