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Hannah - climbing the business peak
Written by: René Jakl
Photo by: Vladimír Weiss

Most sports-minded people in this country are well-acquainted with the Hannah brand. In 12 years this producer of athletic equipment has blossomed into a joint-stock company with a significant market share and a well thought-out development strategy.

Stanislav Krpejš & Jan Reitspies

"AT THAT TIME, rock climbing was the meaning of my life," says Stanislav Krpejš, recalling the fall of 1991, when he and two partners established Hannah in Pilsen. It's no wonder that his friends were fellow rock climbers: Daniel Hála and Hana Zachariášová.
It was Zachariášová, though at the time was sewing customized sleeping bags for friends, who provided the impetus to establish the firm. That's why the company, which controls a significant part of the sportswear market, is now named after her - it's the English version of her Czech name.
"We started out with down sleeping bags and parkas, things that we ourselves needed at the time," Krpejš says. "Then we offered our products to some acquaintances, and we finally discovered that we could make a good living from it." After starting out in Hana's apartment, shredding feathers in the bathroom and sewing products in the living room, the three partners rented fifty square meters for their first workshop in Pilsen, and hired two employees. In the fall of 2003, Hannah will move into a large, 4,500 m2 business center on Americká Street, in Pilsen's center.

The school of life
After an initial season, with sales of around CZK 500,000, Krpejš, who was then a third-year student of engineering, discovered that his studies didn't promise him much help in his activities. So he dropped out of school and threw himself into Hannah's development. Forever. With the start of production the legal form of the company had to be changed, so in 1993 the association of individuals was changed into a limited liability company, Hannah sport. In the same year the partners took out their first major bank loan - CZK 500,000. However, according to Krpejš, most of the investments were and continue to be paid for by Hannah itself. "When you grow from scratch, you grow quickly," says Krpejš, and Hannah's past growth of sales bears him out. In 1994 the company's sales topped ten million crowns, and four years later a hundred million. In the meantime, the firm went through major ownership changes. In 1995 Krpejš bought Daniel Hála's stake, and Hála left the company. "We had different ideas about management. It wasn't much fun at the time, but now we enjoy vacationing together again," says Krpejš, recalling Hála's departure.
From the very start Hannah has placed all its concentration on the product: at the beginning, down sleeping bags and jackets, and later tents, backpacks, and other accessories in addition to clothing. "We never wanted to build up our own retail network. We are a manufacturing firm," Krpejš says. The two shops in Pilsen and the one in Klatovy serve more as showrooms, even though products made by other manufacturers are sold there, too. A competitor's parka hanging next to your own product provides you with welcome feedback for marketing purposes. Watching customers decide which product to choose can be of great value.

Made in China
"In the mid-nineties we discovered that we couldn't compete in some market segments with goods produced in this country, so we started producing goods in Asia," Krpejš says. Hannah currently has an office in Shanghai, with 16 employees who coordinate production in Chinese factories. Krpejš says that the reason for shifting production lay not only in costs, but also in availability of high-quality materials from Japan, Taiwan, and South Korea, as well as the Asian flexibility, where 100% year-on-year production increases pose no problems. Because the patterns are prepared by the Pilsen design center using the Gerber electronic CAD system, they can be easily sent to Shanghai in a moment by e-mail.
As sales rose in 2000, the limited liability company became a joint-stock company. This January Jan Reitspies was named director. With experience with several international firms, his task is to complete the transition from what was originally a small, informal firm into a structured mid-sized company. Krpejš, who turned 33 this year, remained as chairman of the board, which has freed up his hands, and especially his mind, for strategic planning.
"We are seeking a compromise between a company run on rules and a company based on friendly relationships," says Reitspies. "We won't stop calling each other by our first names, but we have to clearly lay out authority and responsibilities for individual positions, integrate our logistics, and make other systemic changes. We are getting ready for ISO certification and for European competition. As they say, 'fortune favors the prepared'," he asserts.