Dish up a kids’ snack onto a plastic plate featuring the Frozen princesses or that goofy snowman they hang around with, and chances are good you’re using a project created by West Plains-based Zak Designs Inc. 

Thirty-eight years old, the company has made its mark creating dinnerware emblazoned with kids’ favorite characters.

Having nurtured rare relationships with Disney and other big names in the entertainment industry, Irv Zakheim has built a large, worldwide manufacturing operation. The Journal sat down with Zakheim recently to find out how it started—and how far it has come.

Journal: Talk to me about Zak Designs started.

Irv Zakheim: When I was in fifth or sixth grade, I was one of those kids who knew exactly what I wanted to do. I went through high school and college, and I was going to be a pro baseball player and a coach. As a backup, I was taking psychology classes to be a counselor. Of the people I knew at the high school, I really admired my coaches and the counselor.

When I was through with baseball after a couple of years, a friend of mine was working in insurance in Century City, in LA. He called me over to have lunch and try to sell me insurance, and by the end of the day, his district manager had hired me to come over and be an insurance salesman. 

Then a cousin got married in Hawaii, and I moved over there. When I was there, the puka shell craze happened so I started selling the shell necklaces on the beach of Hawaii. From that, I met some Filipino people, and they said, ‘You can get these real cheap in the Philippines.’ I ended up going over to the Philippines for a couple of months and bringing them back and selling them. 

But going around the Philippines, I found a small embroidery company that I invested in and created a line and came back to LA. 

It started as embroidery?

IZ: It was all embroidery. I based it in Southern California and flew around to Dallas, Atlanta, and New York where all the showrooms were, hired sales reps, came back, and started the business. To supplement my income, because I wasn’t making enough doing that, I’d sell insurance and work odd jobs. By the late ’70s, it was more of a full-time thing. Then every year, we were building and growing. 

In the earlier days, were you still doing the embroidery work in the Philippines?

IZ: Yes, and it was hand-embroidered things. When we started out, it was decorative pillows, and then we got into Christmas ornaments and tree skirts and stockings. 

Then in 1983, (Benigno) Aquino got assassinated. He was a presidential candidate in the Philippines. (Ferdinand) Marcos was the president. I was on a plane flying back to the Philippines when the stewardess is coming down the aisle going, “Aquino assassinated.” And here I am, flying into that. I ended up finishing up that year and thinking that I need to find someplace else. I knew something bad was going to happen, because the people there loved Aquino. Marcos was pretty strong, and he kept people at bay for a while, but I figured, this is not a place to be. 

I checked out the places in China, which wasn’t quite ready for American businesses at that time, but I moved over to Taiwan. All of our production moved there.

At that point, the U.S. government was putting some restrictions on textiles. I was concerned that if all I had was the textiles business, eventually there could be quotas, and they could stop from growing or actually make us go out of business. I went to different factories in Taiwan to see what I could do other than textiles. For whatever reason, I walked into a factory in Taiwan that was making melamine dinnerware, and for some reason, I thought, OK, that’s what we’re going to do. 

So you never got into the licensed characters when you were doing embroidery?

IZ: Never. Not until after I built up that dinnerware business.

In the mid-‘80s, I went to my 20-year high school class reunion. I went to school with a guy whose dad started Alvin and the Chipmunks. So I said, ‘Why don’t we do something? Why don’t we put Alvin on our dinnerware?’ 

I called his agent, and at the time, the agent said, I have something better than Alvin for you, and it was Pee Wee Herman. Pee Wee, at the time, was hugely popular. I put him on, and all of a sudden, our business really took off.

Then Disney saw our stuff and came and said, ‘Hey, can you do some stuff with us?’ They had a Chip’n’Dale Rescue Rangers movie. So we did that and did pretty well with that. Our business was doing well. 

Then I went down to negotiate the next deal with Disney in the late ’80s, and at that time, they were preparing to bring out the huge movie with Dick Tracy, starring Warren Beatty and Madonna. Everybody was going after that, and I went over to negotiate it, and they said, ‘Ok, we’ll do this deal here, but you have to take this other one too as part of the package. We’ll give you a real good deal on it.’ I paid X amount for Dick Tracy, and I got this other one for far better. It turned out to be The Little Mermaid. 

Oh wow. 

IZ: You know. It became the biggest thing Disney had done at that time. It was perfect for our dinnerware set. At that point, we got it in all the major retailers. Walmart. Target. All of them. All of a sudden, we were going to a whole different level.

How did you end up in Spokane?

I married a girl from Spokane. We started having kids. She hated LA and said we’ve got to get out of LA. We’d been coming to Spokane, and I was thinking, well, if we’re going to move, let’s move close to her home. We started looking around 1991, and in April 1992, the LA riots happened, and then I started getting more serious about it. 

I came up and talked to the banks. I said, ‘Here is my credit line in LA, if you can match it, I’ll move up here by the end of the year.’ They wrote me a letter that same day. They wanted our business. 

All we needed now was a building. We looked all over. At that time, we were looking for about 25,000 square feet, but at that time, there weren’t many available. 

This one came available. It wasn’t even listed yet. Dick Edwards was showing us around, and we were standing outside and he said, ‘Let me call.’ We came in, we looked and said, ‘Oh yes, this is perfect.’ We struck a deal.

You came here in 1992. And the West Plains was …

IZ: Nothing here. And the only reason I moved out here was because I was from LA and didn’t know any better. People would ask me where I was. I would say I was on the West Plains, and they would shake their head. They’d say, ‘Nobody is out there,’ or ‘People go out there to die.’

A couple of years before I came out, Boeing built its plant. So there was Longhorn Barbecue, Boeing, Burger Stop, Zak Designs, and Fairchild, and nothing else. Airway Heights, if you blinked, you missed it.

I’d have to say my brilliance was due to my inability to know any better.

What are your views on how it has changed? 

IZ: I’m a businessman, so my view is having more business out here is a good thing. Number one, it improves my property values. Secondly, it was really a very low income area. Everything has been elevated. 

What happened after you moved to Spokane? 

IZ: Six came up from LA, and we started out with 25 employees, but by the end of the first year, we had 48, and by the end of the second year, we had 100. 

Our business was booming at that time. We had Mermaid, then they re-released Dalmations, Jungle Book, then they brought out Aladdin, Beauty and the Beast, Lion King. One after other. Just huge hits. Through the ’90s, we had incredible growth. 

Then we started setting up our global offices. We had distributors outside of the U.S., but we started setting up our own offices. We set up offices in the UK, Europe, Australia, Mexico, and China, where we’re selling our product.

We went from $2.5 million (in annual sales) in the late ’80s to $55 million in the ’90s, then we went to over $175 million globally. Our business was going really well. 

Present day, what is your footprint? 

IZ: We peaked at about 200 employees here and about 450 globally. In ’08 and ’09, when the problems came, stores just stopped buying. We’ve had ups and downs in our business over the course of time, but never to a point where people just stop buying. It was a tough two years. During that time, we restructured. We went down to about 140 here. Now, we’re back up to about 155. 

In 38 years, for 36 of those we made a profit. Even in the early years, because I was doing other things for income and didn’t take anything out, we showed a profit on the books. During those two years, it was a tough thing for us, because even in the bad years, we always made a profit. 

Laying off people isn’t an easy thing to do, and we don’t like to do it. We haven’t done it very often. Maybe two or three times in our company history. And for us, laying off people has been five people here and there. So for us, laying off 25 percent of our workforce, that’s tough. But we were lean and immediately started making money again in 2010. And every year since then, we’ve been growing back and getting more profitable.

This year looks to be our best year ever.

In terms of sales or profitability?

IZ: Both. We have the hottest property on the planet, which is Frozen. Frozen is going nuts out there, and everybody has to have it. Every time we ship it, it flies off the shelves. We’re fortunate with that, and we have other properties we’re working with. 

Right now, things are going as well as they ever have. 

What were your 2013 revenues, and what are your projections for this year?

IZ: We’re about $52 million last year in the U.S. This year, we’ll probably end up in the $65-plus million range. Next year, we’re projecting 20 percent to 30 percent growth. Globally, it’s back to the $175 million. Next year, we expect to be over $200 million.

And workforce. You’re at 155 here. What about globally?

IZ: We probably have close to 200 in our various offices. 

Are you staffed adequately?

IZ: We’ve been hiring key positions we feel can help us grow. We’ve been strategic about it. We’ll probably add 10-plus people going from this year to next year. 

You talk about the different movies and characters that you make products of. Is each one negotiated separately then?

IZ: They had been. And it became such a burden on us and on Disney. We’d go in there, and we’d have 20 properties, and we were doing deals. Finally, I went into them and said, ‘This is crazy. We’re sort of your licensee in the category. Why don’t we just do an umbrella deal?’ That’s been almost 10 years. Now we can focus on growing the business instead of negotiating deals. 

It was a win-win. They love working with us, and we love working with them. And we built a category that didn’t really exist until the early ’90s. It’s a major revenue source for both of us. 

Is there an exclusivity agreement with Disney?

IZ: There’s none on either side. We’ve had a two-year deal for 26-plus years. On their side, they don’t give any exclusives, because if they inadvertently did something, they would get into lawsuits. All of their contracts are nonexclusives. The trust between both of us is so good that I think we feel comfortable doing it this way. 

Obviously, they are the largest licensor you work with.

IZ: Yes, but we deal with all the major ones. We deal with Nickelodeon. We deal with Warner Bros. San Rio, which does Hello Kitty. With most of the major studios, we have something going on. 

Talk to me about the challenges you see in your industry post-recession.

IZ: The biggest issue is the cost of goods, which is always the case for everybody. The retailers always want lower prices, and you’re trying to do quality merchandise. The bottom line is you can’t always do both of those, so you have to figure out how to get quality products to market at the best prices you can. That’s always an ongoing challenge of how to do that on a continuous basis. 

Labor costs, material costs, and exchange rates are all going up, so they’re trying maintain pricing that isn’t going up.

Do you make a type of product that is more popular than others? 

IZ: We call ourselves a mealtime company so we sell a lot of plates. We sell a lot of bowls. 

But it’s becoming more and more popular to hydrate. Two things have happened. Hydration has become more popular—drinking more liquids when you’re active. The other one is eco-based products, so people try to use reusable bottles. That’s sort of a key area we’re trying to focus on. 

The reusability factor of everything we do is important. Even though it’s plastic, it’s all safe and BPA-free. We making things that can be reused. 

They buy our knives and forks. They buy our plates and bowls. But the drinkware category has been very, very strong.