Photo: William “Bill” Shouldice IV, VTB's president and CEO. Photo by Randolph T Holbut.
by Joyce Marcel, Vermont Business Magazine You can keep your Ben & Jerry's. For my money, there couldn't be a more iconic business in Vermont than Vermont Teddy Bear. They're soft, they're cuddly — they're teddy bears, for heaven's sake — they come from Vermont and they're shipped around the world.
Of course, there's a darker side to the story. VTB sprung into existence from a push cart on Church Street because men everywhere — husbands, brothers, sons, lovers, you know who you are — kept forgetting birthdays and anniversaries. Needing a quick fix, they'd hear an ad on talk radio about the overnight delivery of a cute fluffy bear bearing (sorry) a message of love and forgiveness. They'd order one and, lo and behold, a flourishing business was built on guilt as well as on children's happiness.
At VTB's Shelburne home, bears abound. Large bears, small bears, expensive bears (dressed 15” Bears range from $59.99 to $99.99), cheaper bears, all-the-colors-of-the-rainbow bears, first responders bears (a fireman bear, a policeman bear, a nurse bear,) a bear inexplicably wearing a t-shirt that says, “Keep Vermont Weird,” a zombie bear with “blown out eyes,” and even a Bernie Sanders bear (wearing a sign that says, “Feel the Bern.”) There are also incredibly soft bunny rabbits and even a topiary bush shaped like a welcoming bear that may be more prickly than Bernie.
The bears are stuffed with — you'll never guess — the fluffiest, softest, cloud-like, whitest, shredded recycled plastic water bottles.
“Plastic has memory,” said William “Bill” Shouldice IV, 54, who has been VTB's president and CEO for the past six years. “Cotton doesn't. When you stuff plastic into a bear, the bear doesn't change its form over time. It remains in the same shape. The other reason we use it is that water bottles are made of a food-grade plastic with antibacterial properties. So if something was to get in the bear, the bear won't degrade, decompose and make a mess. With those two things together, we're able to both be environmentally conscious with our product but also meet our quality standards.”
Shouldice has an impressive resume.
Before coming to VTB, he ran The Vermont Country Store Inc. Before that, he served as president and CEO of the Orton Family Foundation. His name is better known around the state, however, for the time he put in as Vermont's Secretary of Commerce and Development during the Howard Dean Administration.
Currently, Shouldice is also chair of The Vermont Futures Project, a research and education foundation started by the Vermont Chamber of Commerce — Shouldice also sits on its board.
It is tasked with studying the Vermont economy with an eye to the year 2040 — in other words, taking the very long view.
He's also the chair of Starbase, a Department of Defense STEM program run by the Vermont Air National Guard; he was recently made an Honorary Commander. He's also a member of the Vermont Business Roundtable.
Shouldice is — and there's no other way to say this — a big teddy bear of a man. He's tall, athletic, energetic and enthusiastic; he's what they call in Spanish “muy amable.”
“One of Bill's most endearing traits is that he's never at a loss for words,” said his long-time friend Scott Boardman, of Hickok & Boardman Insurance.
Stuffed toys can get rough treatment, so you can bet VTB has a hospital for bears. The number one destructive force attacking bears is dogs, Shouldice said. The most common injury is to the bears' faces, which get chewed off.
Not to worry.
Photo: Inside the Vermont Teddy Bear Factory. Photo by Randolph T. Holbut.
The bears come with a warranty. Send the damaged bear back to Shelburne for a replacement face and it will come back perfect again, neatly wrapped and accompanied by chocolate. In the hospital, a bear in a bed with an IV hooked up to an upside-down honey jar tells the story.
“I'll tell you a cute story,” Shouldice said. “So I had this kid who got into a fight with his brother. They tore the arms off the bear. And the mother was like, 'We just had this problem.' We said, 'We have a 100 percent lifetime guarantee. Send it back to us.' So the mother put the bear in a box and sent it back to us. And we sent it back like brand new, in the box with a piece of chocolate. So the mother puts the box on the table. The two brothers come in from school. The mother says, 'There's a package arrived for you today.' The kid opens up the box. It was his bear, and it was his piece of chocolate and he ate that. All of a sudden the mother says, 'Where's your brother?' He'd gone upstairs and tore the arm off the bear. 'Now send it back so I get a box and I get a chocolate,' the boy said. And we fixed the bear and sent it back. We pride ourselves on what we do.”
If you need a lovely way to spend an afternoon with a child, bring him or her to the home of the bears, where you can either buy one of the hundreds on display or make one of your own. The Teddy Bear factory offers all the makings of a child's paradise.
“I was walking up the walkway the other day,” said Shouldice. “Ahead of me was a little girl; she had her bear underneath her arm. She was skipping down the sidewalk. I was just observing as she told her grandmother, 'This is the best day of my whole life.' And you know, that's what we're doing here and that's what makes it fun.”
Bears, however, are only the gateway drug at VTB. Pajamas drive the company.
Kitsch aside, Vermont Teddy Bear is a privately-owned, $60 million direct-to-consumer company that employs 120 people full-time year round and adds another 700 for seasonal part time work, Shouldice said.
Among these employees are highly trained fashion and fabric designers, as well as digital marketers and knowledgeable people who can source materials from around the globe.
PajamaGram — “the world's softest pajamas” — now sells over 200 styles of pajamas, including matching ones for the whole family. Hoodie-Footie and Nudies are two of their brands you might hear advertised on national radio before Christmas or Valentine’s Day.
Given that most shopping is now done online, it makes sense that the company sells a great deal of product on Amazon. It has a special digital marketing team to manage that plus email, Facebook, Google, and the company's multiple Web sites.
Shouldice wants this understood: “We're not just a bear company that sells plush. We're a direct-to-consumer company that sells to fulfill a need. In this case it's pajamas and bears. We also do jeans as well, with PajamaJeans. We just launched Addison Meadow, a loungewear (as opposed to a gift) company. We've sold flowers. We ran, for a period of time, the Vermont Brownie Company. What we're really good at is figuring out how to take quality products, offer quality services, and sell them direct to consumers with the goal to be having them come back and shop again.”
The company prides itself on “being 100 percent vertically integrated,” Shouldice said.
“From an idea through developing the prototype to testing on the market to rolling it out to getting it on Amazon to satisfying the sale to helping with any issues — we control all of that,” he said. “You think of this as a teddy bear company, but you might not realize we have people who are global sourcing. Jobs that people don't even think exist in Vermont, exist at Vermont Teddy Bear.”
For example, Matthew Mole is responsible for roaming the world in search of materials.
“We find the factories that are appropriate for different products and then we take it through development stage to delivery to our door here or to a third party warehouse location,” Mole told me.
“We're working in India and Bangladesh. I'm actually off to Africa next month to explore that opportunity. We're looking in the Americas still, you know — in Mexico and Central America.”
All the designers and marketers travel frequently to the Far East; it seems as if Shouldice is the only one who hasn't yet gone to China.
Since VTB was founded in 1983, it has undergone many permutations. The biggest one came in 2005, when the publicly traded company was taken private. One of the people who participated in that process was Cairn G Cross, co-founder and managing director or Fresh Tracks Capital, a Vermont venture capital firm. Cross now sits on the VTB board.
“We took it private because it was really expensive to be a small public company,” Cross said. “All the compliance costs to be a publicly traded company — several hundred thousand a year to do the filings and maintain the paperwork.”
Shouldice is “clearly honed in on how to sell pajamas direct to consumers,” Cross said.
“If you look at the number of consumer companies selling pajamas, there are a lot of them,” Cross said. “Where do you go to even buy pajamas these days? Selling a teddy bear directly translates really well on how to sell other things to consumers. The company tested a number of different products. One was food-related products direct to consumer. They owned a flower company that was a competitor to FTD. The one that worked was pajamas. Right from the get-go. You make teddy bears out of fabric, so you have to be good at making things, at cutting and sewing. You take your bear designers and create some clothing. That happened, and pajamas worked.”
When it went private, VTB was bought by The Mustang Group, a private equity firm based in Boston.
“We thought it was a very interesting and attractive company growth opportunity,” said Bob Crowley, The Mustang Group's managing partner. “It was a small company to be public and would have more freedom if it was private. It continues to be very strong operating company. It has evolved with the changing needs of consumers in terms of gifts, as well as with the advent of the internet. The internet was present when we bought the company, but it was still in its nascent state. Now, of course, most people buy the majority of their gifts on line. And Vermont Teddy Bear is a leader in that, particularly with Amazon.”
PajamaGram was a small company when The Mustang Group bought it, Crowley said, but it is now driving the company.
“Since we've owned it, the PajamaGram has dwarfed the teddy bear,” Crowley said. “It's the fastest part of the business. It is a gift, particularly around the holidays. People like to buy family sets, but it's also a product bought around the year. It's a gift that keeps on giving. People will buy for themselves, and not just around the holidays. Pajamas continue to be a high-growth business, for comfort and, particularly, warmth. Flannel and soft fabric are things we specialize in. Some people buy them for fashion, and some buy them for fun. We make a hoodie-footsie, a kind of adult onesie with a hood, and believe it or not, those are extremely popular.”
Shouldice has been “an exceptional leader for Vermont Teddy Bear,” Crowley said.
“He came at a time when we were struggling to understand the future strategy for the company,” Crowley said. “He quickly got his team together and developed a forward strategy. They've been busy executing the strategy, year over year, and it continues to grow. It's what we look for in a leader – someone who can make a plan, grow the business and attract and retain a great team. Bill does all of those things for us. Of course, it's a native-born product which we're really proud of, and Bill is a multigenerational Vermonter. We're very proud that we have someone of his pedigree running a Vermont home-grown business.”
Shouldice is a proud fifth generation Vermonter.
“The Shouldices moved here in 1888 from Tipperary, Ireland,” Shouldice said. “They come from a little town called Port Roe. My great-great-grandfather was John Shouldice. They were having trouble feeding the family because of the potato famine at the time. So he stole two pigs off the family farm and bought a ticket in steerage out of Cork. And two years later the family got a postcard saying, 'I'm sorry I did what I did. But there were too many mouths to feed. I'm in West Rutland, Vermont, working in the marble industry.'”
The Shouldices flourished in Vermont.
“It's been 1888 to 2013,” Shouldice said. “My great-grandfather, William Charles Shouldice the First, is buried in Cavalry Cemetery. William Charles Junior is buried in East Montpelier. I grew up in East Montpelier. I went to U-32 High School. My dad and mom are both from Rutland. My mom went to Rutland High and my dad went to Mount St Joseph Academy — crosstown rivals.”
Shouldice's father was one of the first employees for Blue Cross Blue Shield of Vermont when they were a satellite office out of New Hampshire.
“Since then, they've broken off and become their own Blue Cross Blue Shield,” Shouldice said. “When dad left, he started William Shouldice and Associates, which is a lobbying and public relations firm. My sister Heather runs the business now.”
Shouldice is the middle child of three — his sisters are older and younger.
His mother was a formative influence on his retailing skills.
“Mum raised us kids until she became the proprietor of The Country Store at 68 Main Street in Montpelier, across from the fire station, which she ran for over 26 years,” Shouldice said. “That was years of selling everything from Nicholas Mosse pottery and Simon Pearce, to the best soup and sandwich you could get in town, to the daily staples, to a really nice wine selection. I probably learned more working in my mother's store than anywhere else. You learn problem solving. You learn math. The fact that so many people today can't make change is really mind-boggling to me. But you also learned about making sure things were customer-friendly. So we'd get out of school and we all played sports, but after sports we got into the store and helped mom. Then we'd go home and do our homework. That was the order of priorities.”
The store was open seven days a week, so the Shouldice family celebrated Christmas on the day before and Thanksgiving on the day after.
“It depended upon schedules, but my mom prided herself on the fact that the store never closed,” Shouldice said. “She was proud that was open even on holidays. Even in the middle of floods and fire, she kept the doors open. It was just a testament to what she really believed in. That's probably where it comes from in me. When we talk about community, the store was more than just a place where we sold stuff. It was a gathering place. Mothers would drop their kids off and say, 'Their dad will be here in a half hour. Let him sit on the steps.' People would drop off important documents and leave them behind the register because they could trust us.”
The famous Montpelier flood of 1992, which devastated downtown, followed by a fire finally forced Shouldice's mother to close the store.
“As a result of that, they went back to the family farm in Tipperary, Ireland,” Shouldice said. “They built a home, and now they spend six months a year there.”
During high school, Shouldice discovered an interest in government; he applied to be a legislative page.
“I was lucky enough to be selected,” he said. “That gave me the exposure to government which I really enjoyed. I just was fascinated by the process of government. Governor Richard Snelling chose me to be his executive messenger. Interestingly enough, I was picked to be deputy secretary of commerce by him in his second round some 20 years later, if you can believe that.”
Shouldice went to Merrimack College in North Andover, MA, where he met his wife, Susan. The couple have three children and recently became first-time grandparents.
“Once I got exposed to state government it was in my blood,” Shouldice said. “My dad had his own lobbying and public relations firm, but I didn't want to go into that. So I was working for Governor Snelling. But I only worked for him for two weeks before he passed away. Then Howard Dean asked me to stay on in his administration, and I stayed there seven years. I prided myself not on being a bureaucrat but on being a public servant.”
When asked to reflect on his government years, Shouldice immediately used the word “naive.”
“I was 26 when I became deputy secretary,” he said. “I didn't know how challenging the job was. And I probably didn't even realize until after I left that it was an amazing run. It was during one of the largest economic cycles that this state has ever seen. I think over our tenure; 33,000 jobs were added. We passed the Downtowns legislation, which gave priority to the infrastructure that existed. And I was the Secretary of record that filed an Act 250 appeal against Wal-Mart for moving into St Albans into a cornfield. I didn't even know those were really cutting-edge, daunting tasks. I think that naiveté helped me to forge on.”
One thing Shouldice and his team decided not to do was chase companies from out-of-state.
“We said, 'We're not going to go outside the state of Vermont and try and attract big companies to come here,'” he said. “We didn't think that fit with Vermont sensibilities. What we did is go to every employer in the state and say, 'What do you need to add one more job?' It wasn't sexy. You know, as my grandfather once said when I went to my first sock hop, 'Dance with the one that brung you.' These were the businesses that were here. How do we help them to expand and grow and add one more job? In creating a better business environment, in sending out more positivity, you get guys like Robert Schad, who decided to move Husky Injection Molding to Vermont out of Toronto. We weren't going after them. But they were like, 'Something's going on in Vermont. We want to be a part of that.' And I think that when we created that culture, good things could happen. Of course 1993 was a good time to be in economic development. You know how much of it is luck, right?
When he took the job in the Snelling administration, people labeled him as a Republican.
“And when I went to work for Howard Dean, he said, 'I don't care what you are as long as you can get the job done,'” Shouldice said. “It was back in a time when partisan politics weren't as strong as they are right now. Today it's polarizing. There's Rs, Ds and Independents, and the feeling is that the closer you keep your cards to your vest, the more power you're going to have. But then, Democrats or Republicans, at least they stood for one thing and that was to do what was right for their constituents. Today, I'm not sure we're getting to the root cause of problems and coming up with solutions to solve them. I think the electorate is distrustful of that. I think that we've got to do a better job of giving transparency. But you should ask the politicians to answer that question.”
It is hard not to see Shouldice as a politician; he speaks in stump speeches. But he claims he will not be running for office anytime soon.
“I've always toyed with the idea of running for office,” Shouldice said. “When I was in the governor's office, working for Howard Dean, my wife said I was never home. I wasn't enjoying watching my kids grow up. So that was one of the major reasons why I stepped down. And I enjoyed every minute with my kids and having that quality time with them. Now they've all grown up and gone off to do great things. My wife and I are empty nesters, as they say, and we just got our first grandchild. So I mean family is probably the biggest reason why I haven't ventured into politics. I'm trying to not become a bureaucrat or a politician.”
From state government Shouldice segued into the Orton Family Foundation, which, according to its Web site, “Empowers people to shape the future of their communities by improving local decision-making, creating a shared sense of belonging and ultimately strengthening the social, cultural and economic vibrancy of communities.”
“After I'd been in government seven years, I thought it was time for me to go explore and see other things,” Shouldice said. “I started running the Orton Family Foundation for the Orton family. And I did that for a bunch of years, until they asked me to come on to their board of directors at the store.”
The Orton family, of course, owns The Vermont Country Stores (not to be confused with the Shouldice family store). When Lyman Orton — the second generation of the Orton family and the entrepreneur who used nostalgia to build the Vermont Country Store into the merchandising behemoth it is today — retired, he left the company to his three sons. They all work in the business, but Orton decided that the company should always be run by professional managers. Shouldice was the second. He thinks the world of the Orton family.
“Lyman Orton is a fabulous guy and a really smart entrepreneur,” Shouldice said. “His three sons are really good guys. They prided themselves on many of the same things I pride myself, one of which is quality. But more importantly, giving back to community. They have their foundation, and beyond that the store gives away a lot of money. The family also does that individually. Although we are out there making money, what is our responsibility for social justice and the environment? What is our responsibility to give back? Lyman Orton was one of the leaders in the nation for banning billboards, not just in Vermont, but across the country. The Ortons have been very generous in giving to the Long Trail and to the Green Mountain Club and to Boys and Girls Clubs and Green Up Day — many of the things that we pride ourselves on in Vermont. They don't just make money for a reason. They back it up by giving back.”
Running a family business when you're not a family member might be difficult — or at the very least, uncomfortable — but at The Vermont Country Store the system seems to work really well.
“All the brothers work really hard at what they do,” Shouldice said. “They have different interests and that probably makes it easier. They are not stepping on each other's toes. Lyman has a very definite idea about the business and how it should be run, and he has a board of directors that supports him in that. The boys are doing a great job of carrying on a family tradition.”
Three successful generations? Not an easy thing to accomplish.
“You know, typically, the third generation is where things start to unravel,” Shouldice said. “But they've beaten that. They go well beyond. The company is growing and expanding. They just had that warehouse fire that could have brought them to their knees. They were heading into the holiday season and winter and they didn't miss a beat. They met their season. It's a testament to who they are. They're smart. They're good business people. They're entrepreneurs.”
Lyman Orton's great collection of Vermont painting is well-known, but he also collects scales, Shouldice said.
“Whether it's Fairbanks — Lyman is a descendant of the Fairbanks family — or Howe Scales and Rutland Scales — Vermont is the pioneer of scales on a spring basis,” Shouldice said. “We're beat now by the alphanumeric computer scale, so they don't make spring scales anymore. So he started collecting those and I think it's just neat.”
The Teddy Bear Business
Shouldice came to VTB in 2013, ready to help the company expand and grow.
Photo: Bill Shouldice works the line just before Christmas 2017. VBM photo.
“We're always looking at our product line and challenging ourselves to make sure it's quality,” Shouldice said. “We're looking at our ad spend and making sure we're getting the bang for the buck. When I took it over, there was a lot of radio and TV that we did mostly with family set pajamas and big bears. And we've diversified from that. There wasn't a lot of digital when I came here. The web has become a bigger influence.”
As most all consumer companies, dealing with the giant Amazon.com has become a big part of the picture. Shouldice calls Amazon “my frenemy.”
“I say that because, at times, they're our friend and help us,” he said. “I mean, they're the world's largest storefront. Do you know that in two years, two-thirds of all online sales will go through Amazon? So I want to have quality product in the world's largest store. At the same time, if they decide to change the rules of the game, you could find yourself with a lot of eggs in one basket. So we're trying to manage that.”
Advertising has also changed radically.
“We've shifted and diversified our spending for ads and how we reach people,” Shouldice said. “We've gone from radio to TV, from catalog to digital, from retail to Amazon. That's how I think we've had some success in growing the business.”
For example, Noah Dater heads a team of digital marketers.
“I manage the digital team which manages all of our email, Facebook, Google and other digital marketing to drive in traffic to our Web sites,” Dater said. “Some of that is figuring out what we want to put in front of people. And then there's a heavy sort of technical side of it, optimizing within the platforms.”
A big part of the business is product development.
“There's a saying that if you're not unique, you'd better be cheap,” Shouldice said. “And we're not cheap. We pride ourselves on being unique. Whether it's the bears we produce or the pajamas we produce, you can only get that stuff by shopping with us. I think that makes us pretty unique. Vermonters by their nature are entrepreneurial. I've got a great team who can leverage the vertical integrated nature of the company from an idea through the getting and shipping it out the door.”
Running VTB has made Shouldice more progressive, he said. For example, he came to Shelburne as a traditionalist: He thought people should work in four-walled offices with doors. Yet the offices at VTB are all open.
“I'm a little bit old school,” Shouldice said. “Maybe the nuns beat it into me. Going to an open office environment was really hard for me to get my head around. Both in terms of privacy and in terms of productivity. And yet when the evidence was presented to me, we took the risk and did it. It's an example of the evolution of the workplace. Employees expect their companies to be progressive in terms of benefits and flexibility. I think failure there would prevent me from retaining and attracting the people who we need to run this business. But I'm proud of the fact that I operate with an open door policy. I hope people with great ideas walk into my office and share them. So we listen and evolve and the quicker we evolve and change, the better off we're going to be.”
Mistakes have been made, of course. As a company, VTB shudders at the mention of the “Crazy for You Bear,” a bear in a white straitjacket that the company brought out for Valentine's Day in 2005. It made Time Magazine's list of “Top 10 Dubious Toys” and raised hell with the mental health community.
“One of the things that I am proud of, when I took over as president, is that we are not going to bring forth a bear that is harmful or offensive to anybody,” Shouldice said. “I think the Crazy For You Bear, making light of mental illness, is crossing a line. We're having a much more rigorous conversation about the new bears we're bringing forward.”
Remember the Bernie Sanders doll? VTB is sort of a political predictor.
“We sold a lot of Donald Trump bears,” Shouldice said. “We sold a lot of Hillary Clinton bears. We sold a lot of Bernie bears. We sold more Bernie bears than we did Trump or Hillary. But we sold more Donald than we did Hillary. As a future indicator, maybe that's why I should be a pollster via bears. Now, if you would like, I have a whole bunch of Bush bears that I'd give you for cheap. I think I sold two of the Jeb Bush bears. He has a bush in his hand. It didn't sell. I didn't say all my ideas were good.”
Shouldice likes sentiment.
“Give the sentiment of love,” he said. “And if it doesn't pass that test, why are we doing it? Because I think life's too short and we are a wholesome brand and we need to be the standard bearer.”
Manufacturing and Marketing
VTB is an international company. The bears are made in Shelburne from rolls of plush made in China. The fabric for the pajamas is designed in Shelburne, as are the pajamas, but the products are made overseas. The bears and pajamas are shipped from Shelburne to all parts of the country and the world.
“Although we enjoy the retail store and do a good job selling stuff in Vermont, most of what drives our sales is not in Vermont,” Shouldice said. “Here, we're probably the furthest away from our market. Our sales are generally in line with the country's population density. So 10 percent of the country's population is in California. About 10 percent of our sales come from California. Florida, which should be a little less because its population density is a little less, is a little bit more because we have what I call 'the snowbird' effect — people who've known about Vermont Teddy Bear in Vermont and are down in Florida for the wintertime. So we can sell more to them. But you want to spread it out. We sell our products across the country as a percentage of population. And that means that we have to compete. We have to compete on service. We have to compete on delivery. We have to compete on quality. And we're doing pretty well, I'm pretty proud to say.”
Given Vermont's low unemployment rates and its active search for more workers, it is remarkable that Shouldice can bump up the VTB workforce from 120 to 700+ for holiday and seasonal work. He does it, he says, without calling on foreign labor.
“It's forced us to really think and rethink,” Shouldice said. “What are people looking for in a seasonal part-time job? The number one thing they're looking for? Flexibility. When I came here, we offered a morning shift or an afternoon shift. Young families with an at-home mom or dad or grandmother want to be able to work, but they also want to get the kid on the bus, and then be there to get him off the bus. So we've said, 'Get him on the bus and be here at 9 am. And leave when the bus comes back.' So we'll take those five hours and be able to get the most out of that.”
Conversely, as the population ages, more people retire.
“They're saying, 'I would like to have some work so that I can pay my tax bill, pay my fuel bill, go on a family vacation, pay my golf greens fees.'” Shouldice said. “Whatever it may be, they'll come in at 2 pm and work till 6 pm. So by pairing up those different populations, we can offer a truly flexible work schedule. So we're able to get the people we need. But it's hard. “
Not every potential employee is a good fit for VTB, and its human resources department must search creatively.
“They do everything you can possibly think of, from Monster.com to running ads in the local papers — it's all about candidate flow,” Shouldice said. “It's all about the right fit. Not everyone will fit here. People have different ideas about what the workday should look like, so we look at fit and then we look at the technical skill they bring to the table. It's aligned with our need and then how do they manage people? Do they manage with a good human touch? And then what's their leadership potential? Could they someday be a leader in this company? We just did an analysis of gender equality and there are more women in this company in leadership positions than there are men. Also, women are paid at or equal to men. And I pride myself on that as well.”
VTB offers benefits designed to help its employees' communities. The company offers CSA participation reimbursement, a company garden, a 50 percent discount of VTB brands, and time off for volunteering.
The bears give back to Vermont in other creative ways. Take the new American Heart Bear, which has a surgery scar down its chest.
“We had a pediatric event here one weekend,” Shouldice said. “I think there were about 50 kids with their families, thanks to the American Heart Association. We presented them with their own bear. Seeing the smiles on everyone's face was interesting. You would think that would be a little bit stepping into their personal space, but the kids were proud there is a bear that represents the scar they have in their chest. It became a badge of honor for them to have this bear. And every kid that came, we gave a bear to. And every bear we sell now, we give profits proceeds back to the Heart Association. That's wonderful.”
VTB has a reputation for good works because of its connection with the Shriners' Hospital and Cyndi Lauper's True Colors United Foundation, which works nationally to end homelessness among lesbian, gay, bisexual, and transgender youth. People come to the company with all sorts of fundraising ideas. It is notable that VTB doesn't seek its partners; they come to them.
“When you're so good with Cyndi Lauper, they come to you for these things,” Shouldice said. “People pitch us all the time.”
This includes the US Navy, which will have a nuclear fast attack submarine called the USS Vermont scheduled to go into service in late spring or early summer 2020.
“They came to us and said, 'Shouldn't Vermont Teddy Bear be involved in some way?'” Shouldice said.
The result: The Dewey Bear, named in honor of Admiral George Dewey, the only officer of the US Navy ever to hold the rank of Admiral of the Navy; Dewey was born in Montpelier in 1837 and served from the Civil War to the Spanish-American War.
Giving back is in VTB's DNA.
“It's all part of our commitment to community,” Shouldice said. “We believe that we have a responsibility to leave our employees, and the communities where we live, work, and raise our families, in better shape than when we found them. People ask me for cash all the time. We don't do that, but we will partner with you. There's a give and a take there. If we try to put on the shelf a bear wearing a fez, we won't sell many of them. But when the Shriners take a relevant bear and put it in front of their constituents, magic happens.”
According to the VTB Web site, “Fezzy,” the Love to the rescue® Bear, “helps raise awareness for all 22 non-profit Shriners Hospitals for Children. Plus, each time Fezzy is purchased, 20% of the proceeds are donated directly to the Shriners.”
There are also amputee Teddy Bears, Make-A-Wish Foundation bears and Little Hero Bears — for every one sold, VTB donates a second one to a first responders organization.
“This ensures that children get a Bear hug when they need it the most: during crisis situations,” says the VTB Web site. “We have donated over 15,000 Little Hero Bears across the nation and look forward to donating many more.”
Doing Business In Vermont
Since VTB is a private global business, the state of Vermont doesn't have much to do with it. But Shouldice is a strong advocate for the state providing businesses with “a predictable and stable environment to make an investment and expect a reasonable rate of return.”
“When uncertainty gets brought into the equation, like healthcare costs going up, and new regulations — the paid family leave proposal is a good example — it's a 1 percent tax,” Shouldice said. “That'll cost me $70,000 a year. Donald Trump's tariffs on Chinese imports could cost me over a million dollars. And so when I'm trying to make investments and get a reasonable rate of return, those things make it that much harder. And so, to the extent that we could have a stable and predictable environment, that would be my preference.”
Photo: Inside the Vermont Teddy Bear Factory. Photo by Randolph T. Holbut.
All the wages at VTB run higher than $15 an hour, but that is another legislative mandate that makes Shouldice uncomfortable. Also, the legalization of marijuana gives him pause. He wonders, how can you punish employees for being high when it's legal?
“It's just one more thing,” he said. “Is it allowable or not? We know people can come to work intoxicated. We have a way of testing for that. But people coming to work with maybe having partaken of marijuana before they get here? We don't have a test for that. Workplace safety is our number one concern. There's a lot of moving parts and pieces here, and people can get hurt.”
The state needs to grow and evolve, Shouldice said, and make sure it remains relevant and competitive.
“It's a challenge,” he said. “You know, I was one of the first people to sign on to early childhood education. Pre-K is vitally important to a young individual's growth and development. There's a lot of money in the K-12 system. But I'm deathly afraid of what's happening in higher ed. We lost three colleges this year. Higher ed is one of the best and cleanest industries we have in the state. It provides a net importation of capital and intelligence. We can partner better with higher ed to make sure that we're getting what we need as employers.”
Shouldice pointed to his stable of young designers and suggested that they may provide a path forward.
“Those folks all had expertise and skills and never thought Vermont Teddy Bear or PajamaGram would be a place where they could practice their craft or their trade,” Shouldice said. “We need to do a better job, as employers, of getting into those schools, and into those communities, and creating those partnerships and creating that awareness.”
Shouldice thinks internships and mentorships are a good place to start.
“But we've got to do better, because with our population aging and in decline, we've got to do a better job of getting our fair share of the youth in Vermont,” Shouldice said. “Here's a statistic which is horrifying to me. Fifty percent of all boys who graduate from high school don't go on to higher education. Where do they go? How do we make sure that something like teenage pregnancy doesn't come back to rear its head? I bet any money, if we could find them, capture them, give them the certificate they need to put them through school to get their Commercial Driver’s License, they can become productive members society. Now we're not making those connections.”
Another thing Vermont could be doing is use its natural beauty and first-class recreational entities to attract millennials, Shouldice said.
“We have world-class recreational entities,” Shouldice said. “I'm not just talking about skiing. Pine Hill Park in Rutland is one of the up and coming hiking and mountain bike trails in New England, and no one knows about it. Maybe that's a good thing? It's quiet. But whether it's the lakefront, the bike paths, the skiing terrain, the cross-country trails, snowshoeing — these are all the things the millennials are going to want. They will work hard during the day, hit their objectives, but then they can have a work-life balance. We're well poised for that. And that's how I'm going to compete with recruiting and retaining our labor force, which is some of the best and brightest in the business that we're trying to run.”
Shouldice says he's not going anywhere; he loves his job.
“We've got a lot of work to do here,” he said. “We're in the middle of a technology upgrade. We're rolling out Addison Meadow. We're expanding the PajamaGram business, which is the family pajamas and others. We're continuing to do a nice job with our PajamaJean business. We think the bear is an important part of Vermont, and we've expanded the line to make it appeal to a broader constituency — it's gone beyond people who bought a bear dressed in a nurse's uniform because their wife became a nurse.”
He loves living in Burlington.
“I have no plans to leave Vermont,” he said. “This is where I was born and brought up. My wife and I now live in Burlington, which is not a bad place to have an empty nest. We have the Flynn Theater and the waterfront. We've got great restaurants. We've got great friends up here. And so for the foreseeable future I see myself as being right here in Vermont. I like Vermont Teddy Bear. I like the challenge. You know, I've run two major companies in Vermont and both of them have Vermont in their name. If you look at my lineage and where I came from and how important Vermont is to me as a person, if you have Vermont in your name of the company, it's a higher calling. It's a bigger responsibility then to just run a business for the sake of generating a profit. You do it because Vermont means something. It has a connotation of quality, and you better back it up with what you sell and in the service you offer.”
Cairn Cross thinks Shouldice was a great hire for VTB. He also thinks he is “a born politician.”
“I've always felt that he and his family know everybody in Vermont,” Cross said. “What attracted us, he's well connected in Vermont, can call on a lot of people for help, and because he's a born politician he's not afraid to be out in public. The company needed to have its brand refreshed locally. It needed a person like Bill, who was willing to go on early morning talk shows and tell the world we were hiring for Christmas. We needed someone who could really act like the proprietor of a company as well as being its CEO. He knows people's names throughout the company. He knows what their children are doing. It's a leadership quality. He's connected, and we thought he would figure out who the stars were in the company, elevate them to new positions and set HR policy. That's all proven to be true. To summarize in one sentence, he's rebuilt the culture, restructured the balance sheet and delivered consistent profitability. Those three things are hugely important.”
Joyce Marcel is a journalist in southern Vermont. In 2017 she was named the best business magazine profile writer in the country by the Alliance of Area Business Publications. She is married to Randy Holhut, the photographer who took the photos for this story. He is also the news editor/acting operations manager of The Commons, a weekly newspaper in Brattleboro. The couple have been living in a Windham and Windsor Housing Trust shared equity home for more than 22 years.