How He Built an Eight-Figure Business Selling Toilet Paper

Jake Berk is 31 and the president of Berk International, a second-and-third-generation family business in Boyertown, Pennsylvania that converts toilet paper, paper towels and dry wipes. His grandfather started it in the 1970s buying bales of reclaimed T-shirts; Jake's dad and three uncles cut them into 20-pound boxes of rags and rolled them up driveways on skateboards. They built that into a company, sold it in the late 90s, watched the buyer run it into the ground, took the machinery back and started over. Today it pays eight figures a year and ships to 15 countries.

Jake's dad is still the CEO. Jake is the president who has effectively run sales for ten years. For a long time they loosely talked about where the business was going and never actually said it. Then a consultant sat them down with ten questions, had them write their answers separately, and read them aloud. They were not on the same page. That exercise is the reason this conversation could happen.

We break down:

• Why "boring" businesses are having a renaissance, and why toilet paper is as safe as it gets
• Manufacturer vs. converter: parent rolls from Egypt, China, Vietnam, Turkey and Italy, 300 stock SKUs plus 150 private-label items
• Selling only through distributors: food service, jan/san, industrial, and why price alone never wins the account
• Freight on a low-margin commodity: the largest price increase they have ever pushed, delivered pricing, and why Jake refuses to add a fuel surcharge
• The "same page" exercise that finally got a father and son honest about a liquidity event
• Why "we want more sales" is the wrong goal, and the cash flow modeling to do before hiring another rep
• Building a target map by industry and region, and holding one person accountable to it
• Whether Berk should go direct to end users, and how we run Filterbuy's nine distribution points and same-day courier delivery
• Family business rules: don't overlap roles, name the decision maker, and say the expectations out loud
• Jake's advice to anyone who wants to start a manufacturing business: don't. Become a distributor first.

I grew up in a distribution business and bought it in 2012, and we stocked toilet paper too. Every time it grew I had less cash, which is why I ended up in air filters getting paid upfront. So my take for Jake: more sales is the easy part. Before you hire another rep, model what five times the revenue does to receivables, inventory, purchasing, customer service, lead times and the credit line. Cash, not demand, is what stops a distributor from growing. Nobody actually wants more sales. They want more money in their pocket, and those are not the same thing.