James E. Schrager, clinical professor of entrepreneurship and strategy at the University of Chicago Graduate School of Business,
explains why the two companies did not merge well.
Profit margins at Kinko’s have fallen, revenue has barely grown and employee turnover, which was 42 percent in 2005, was still a daunting 27 percent last year. Paul Orfalea, who was nicknamed Kinko for the full head of curly black hair he sported in 1970 when he founded the company — originally to serve students at the University of California, Santa Barbara — says he will not step inside the stores now.
“It gives me a stomachache to see what’s happened to the place,” Mr. Orfalea, now balding, said.
I adore Orfalea, who wrote a memoir called
"Copy This! How I turned Dyslexia, ADHD, and 100 square feet into a company called Kinko's." He got me through the loneliest segment of that 1235 mile drive from Austin to Madison last month as I clicked the satellite radio over to C-Span and heard him giving a talk based on that memoir. What a wonderful, inspiring guy! Did you know Kinko's is called Kinko's because Ofalea was called Kinko because of his kinky hair? By chance, C-Span TV happens to be replaying that show at 12:10 Eastern Time today. [ADDED: Or watch it right
here. AND: No, it's gone now.] I'm going to set my TiVo right now. He's incredibly interesting.
“Kinko’s was a way station where you stayed a few years, but you build a career at FedEx,” [said Kenneth A. May, the chief executive of FedEx Kinko’s.] “The Kinko’s people are hip, they’re fun, but they needed oversight.”
Kinko’s workers, many of whom still tell tales of the annual picnics Mr. Orfalea gave for co-workers (he hated the word “employee”), describe an entirely different situation.
Kinko’s coddled its workers, they say, who in turn coddled customers. “I had cornrows and green hair, and no one seemed to mind,” recalled Sharon A. Robinson, once a worker at a Kinko’s in Laramie, Wyo., and now a product specialist....
“It was the People’s Republic of Kinko’s, a place where store managers thumbed their noses at corporate and ran the stores as they saw fit,” said Gary M. Kusin, a retailer who was recruited by Clayton to run Kinko’s in August 2001. [Orfaleo sold his company to Clayton and Clayton sold to FeEx.] ...
Clayton formed a central organization, and proceeded to do what buyout firms do best — cut costs, streamline operations, and groom Kinko’s to go public.
But it went too far, in Mr. Orfalea’s view. “I told them that our biggest asset was the sparkle in our peoples’ eyes,” he said. “But they threw away senior people like garbage.”
Sad!
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That's really sad. Kinko's employees always kind of reminded me of Starbucks employees - just a little more eclectic than your average chain employee.
I used to use Kinko's at my old job despite a new printer coming in every other week or so trying to get our business. They just had more personality and worked really hard for us.
My three gripes about Kinkos:
1) At the Kinkos I occasionally visit, there's never a clear line for customers, just a muddle of people in front of the counter, hoping to win a clerk's attention.
2) The employee workspace is open to customers' view. And it's noisy. I no more want to see, hear, or smell industrial copiers than I want to watch people assemble Big Macs.
3) Kinko's seems to attract employees who feel a desperate need to make sociopolitical statements with odd facial ornamentation and wacky hairdos.
Kinko's employees are lazy, lazy people who should be put out to pasture.
Kinkos WAS a success when it's only competition was a memeograph machine and a slow, brokedown, out-of-paper copier in a locked broom closet. UC Santa Barbara is hardly a Mecca for business types unless they want to sell futons and learn how to role a doobie while playing volleyball (We focus on you and your learning experience.)
Kinko's business model, if you can call it that, is not ready for prime time. It will not be able to make the transition from liberal UCSB to the strict and successful business model at FEDEX.
http://www.c-span.org/search/basic.asp?resultstart=1&resultcount=10&BasicQueryText=Orfalea&image1.x=0&image1.y=0&image1=Submit
I first started using Kinko's when I moved to NYC began submitting music scores I had written for possible performance considerations.
Initially, I was struck by the how Kinko's quality could widely vary between stores and employees. I began to familiarize myself with the names and working hours of the best Kinko's staff so as not to find myself stuck with someone who could not seem to figure out how to make back-to-back copies in landscape mode.
Sometime around 1999-2000, I noticed a change in the Kinko's atmosphere- regularly worn store uniforms, a tidier floorspace, no huddled masses of undercaffeinated students clogging up the computer rentals section.
In Early 2001, I went to a midtown Kinko's to get some sheet music copied (as the few quality employees I trusted had long since left my neighborhood Kinko's). The counter-person there told me that they could not copy my sheet music because of Kinko's copyright policy. I explained back that I am the copyright holder to the music (as my name is on all the scores), and offered to show them some ID to prove that.
The employee said that that wasn't good enough: I had to come in with a written letter authorizing Kinko's accept the sheet music from me and permitting Kinko's to make the copies for me.
Since that experience, I have never gone to any Kinko's again for copying jobs.
When I was in Tokyo, I didn't go into the office on weekends, and I didn't have an internet connection at home. So when I needed to check mail, I did it at Kinkos. So I have good memories of the place.
Never used them for copying, though. But my limited experience with copying people is that they're often not all that diligent about their jobs -- whenever we're sending copies out, I or another attorney always has to go through the copies to make sure the copies are arctually correct, and we don't have 2 A's and no B's in set 1, and 2 B's and no A's in set 2. It's frustrating.
I was a Kinkoid for two years during graduate school in the early 1990s. I didn't work in the copy shop, but in one of their first computer services shops. I always found the hippie hype to be just that, mostly hype. The pay was low, and no, the store manager didn't have a wide range of authority. The good things I can recall was the tolerance of different people's personal styles, profit sharing that encouraged efficient work, and a practice of allowing workers a $300 margin to deal with customer complaints without making them wait on a manager.
The company did indeed start firing longtime employees after the FedEx merge; one of my friends, an assistant manager, was closing in on 20 years when she was tossed aside.
Kinko’s coddled its workers, they say, who in turn coddled customers.
Kinko's has had notoriously bad customer service since long before FedEx went anywhere near the place. My friends and I used to joke that you could copy anything you want in Kinko's because the employees are busy trying not to notice that you've walked into the store.
The Rise and Fall of Kinko's:
. . . is very hopeful, actually.
It shows that there will ALWAYS be a way for someone to start a new company or service, and when even that gets wildly successful and threatens to take over the world, someone smaller will come along, find an underserved niche, and become successful in the face of the big guy.
Even Walmart is starting to lose to Kroger in the head to head grocery business. Kroger decided to act, rather than react, and think like a small company again.
American capitalism: it will ever be thus!
Orfalea has only himself to blame.
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