Poof-Slinky, Inc.

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Poof-Slinky, Inc.

45400 Helm Street
Plymouth, Michigan 48170-0964
Telephone: (734) 454-9552
Toll Free: (800) 329-8697
Fax: (734) 454-9540
Web site: http://www.poof-slinky.com

Private Company
Incorporated: 1945 as James Industries, Inc.
Employees: 100
Sales: $20 million (2002 est.)
NAIC: 339932 Game, Toy, and Children's Vehicle Manufacturing

Poof-Slinky, Inc. is a leading manufacturer of simple, inexpensive toys including the classic spring Slinky and various foam balls, airplanes, and rockets. The firm also produces Slinky Science educational and scientific toys and the Ideal line of tabletop games. Poof-Slinky operates manufacturing facilities in Plymouth, Michigan, and Hollidaysburg, Pennsylvania, where Slinkys are still made on machines the toy's inventor Richard James designed in the 1940s. Poof-Slinky is owned and managed by Richard Dallavecchia and Doug Ferner.


The origins of Poof-Slinky go back to the invention of the Slinky in the mid-1940s by Richard James, a marine engineer working for the U.S. war effort. His inspiration for the toy had come in 1943 when he saw a torsion spring, part of some test equipment he was using, fall from a shelf and then move jerkily across the floor. Struck by its potential for use as a child's toy, he began experimenting with different formulations of metal until he had perfected a rolled-steel spring that could "walk" down a flight of stairs. The name Slinky was supplied by his wife Betty, who had turned to the dictionary in search of a description for the spring's unique movement. Though little interest was shown in his creation at first, a Gimbel's department store in Philadelphia agreed to let James demonstrate the product just before Christmas in 1945. James sold 400 of the $1 toys in 90 minutes.

These first Slinkys were manufactured by an outside firm for the Jameses, but when sales started to take off Richard James designed machinery that could roll and coil the 80 feet of wire that each Slinky required. Calling their firm James Industries, Inc., they set up a factory in the Philadelphia suburb of Clifton Heights to produce the toy. To protect it from imitations, James patented the wire composition and manufacturing processes.

In 1948 a smaller version, Slinky Jr., was added, and it was followed in the 1950s by a Slinky Train and a Slinky Dog. The latter pair had been designed by a homemaker from Seattle named Helen Malsed, who had submitted the ideas to the firm.

The 1950s saw Richard James join a cult-like religious group that began to exert a growing influence over him, and to which he allegedly began funneling company profits. At the same time the Slinky's popularity was declining, and by the end of the decade the firm was in rough shape financially. In 1960 Richard James announced to his wife that he was planning to move to Bolivia to live with members of the group, and he gave her the choice of accompanying him, selling the company, or managing it herself. Rejecting the first option outright, she decided to stick with Slinky and run the firm on her own. Though she had always been involved with the company, she did not have full knowledge of its operations, having primarily concentrated on raising their six children, now ages 2 through 18.

In order to fully devote her energy to turning the business around, she decided to move back to her home town of Hollidaysburg, Pennsylvania, where she could rely on the assistance of family and friends to care for the children. The move necessitated a weekly commute of some 200 miles to Philadelphia, where she would stay from Sunday through Thursday. She began working on plans to relocate the company, however, and after a year and a half was able to move its operations to Hollidaysburg.

Television Ads Debuting in 1962

In 1962 James Industries began airing television commercials which featured the catchy new "It's Slinky" jingle. Sales shot upward, and ads using the song would continue to run for years afterwards. Richard James, meanwhile, would remain in Bolivia except for occasional visits to see his children. He died there in 1974.

Over the years the Slinky was changed very little, save for galvanizing the metal to protect it against rust and adding a crimp to the ends for safety. It continued to be produced on Richard James's original machinery, which sometimes was operated on three shifts to produce a Slinky every ten seconds around the clock. In addition to its popularity as a toy, the Slinky had been put to many other uses. In Vietnam, U.S. soldiers had employed it as an antenna, and it had also been used in light fixtures, for keeping leaves out of rain gutters, in pecan picking machines, and in any number of school science demonstrations.

In the 1970s and 1980s sales of the toy continued at a more or less steady pace, even when television advertising was not run. A survey done by a cereal manufacturer had found that 90 percent of the population knew the toy, and Betty James reasoned that ads were not necessarily vital to the still inexpensive Slinky's success. Sales were also boosted by media attention for the toy's use in experiments aboard the Space Shuttle, as well as by its appearances in television shows and movies including Ace Ventura: Pet Detective and Disney's Toy Story. For the latter, which featured a new animated version of the outofproduction Slinky Dog, James Industries had been given advance notice by Disney, and had begun work on a version that resembled the toy in the film. Unfortunately, the plastic molds were not completed in time, and the company missed the chance to sell it during Toy Story 's Christmas 1995 theatrical run. The Slinky Dog was finally brought to market the following February, in time for the movie's video release.

During its golden anniversary year of 1995, Slinky sales hit a peak of nearly six million, later returning to an annual average of less than four million. A total of 250 million copies of the toy had been sold in the half-century since its introduction. A colorful plastic version, which debuted in 1979, now accounted for nearly half of all Slinkys sold. Over the years James Industries had also added other products including pin wheels, plastic rings, building blocks, Pick-Up Stix, but their sales were dwarfed by those of the Slinky, which was still priced inexpensively at less than $3.

Sale to Poof Products in 1998

Though in good health and still a vital presence at the company, 80-year-old Betty James decided to sell the firm, which she co-owned with her children, so that they would not have to pay inheritance taxes. Many larger companies had tried to buy James out over the years, but her loyalty to the product and to her employees, many of whom had been with the firm for decades, had led her to turn every offer down. She finally reached an agreement in 1998 with a company called Poof Products, Inc. of Plymouth, Michigan, whose line of simple foam toys complemented the classic Slinky. Poof had also met her main requirement that Slinkys continue to be manufactured in Hollidaysburg.

Poof's origins dated to the early 1980s, when it had been started as a division of a manufacturer of foam products for the auto industry. The firm initially offered a few simple items such as footballs and soccer balls, and by the end of the decade its annual revenues had grown to approximately $2 million. In 1991 Poof was purchased by Ray Dallavecchia, Jr., and Doug Ferner, who took the positions of CEO and executive vicepresident, respectively. Under their leadership the company's output was expanded, and by 1995 Poof's revenues had more than tripled, topping $6.6 million. At this time its product line included footballs, basketballs, soccer balls, puzzles, rockets, airplanes, helicopters, and other toys, most made of polyethylene or polyurethane foam.

In 1996, seeking more capital to help the firm grow, Dallavecchia had begun looking at the possibility of selling 12 percent of the company in a public stock offering. He was put off by the expenses involved, however, as the necessary legal and underwriting fees would consume as much as $700,000 of the $5 million he hoped to raise. Seeking an alternative, he discovered a software program called Capscape which created an Internet sales portal and automated the lengthy process of writing a prospectus, helping to cut the offering costs to less than $150,000. At the start of 1997 Poof began selling the stock online, requiring a minimum purchase of 150 of the $5 shares.

While the offering was getting underway the firm purchased Chasco Toy Co. of Oklahoma, another foam toy maker, and moved its jobs to Michigan. The acquisition increased the company's workforce to a total of 50. Almost half of Poof's sales at this time were to three major retailers, Wal-Mart, Kmart, and Target. Recent additions to the firm's product line included wind-up cars that could be taken apart and reassembled, and foam-tipped rockets filled with candy that could be fired as high as 30 feet in the air.

The year following the July 1998 acquisition of James Industries saw Poof sign an agreement with Chase Toys, Inc. that gave it worldwide manufacturing and distribution rights for KLIXX products. KLIXX, plastic links which could be connected to form chains or structures and made a distinctive sound when attached, were relaunched under the Slinky brand name. Poof also added new products, including a line of collectible Slinky Pets and the Slinky Jr. with Dum-Dum Pops Candy Surprise.

Company Perspectives:

Poof-Slinky, Inc. is a leading manufacturer of foam sport balls in North America and maker of the world famous Slinky, manufactured with pride in Hollidaysburg, PA.

Poof Buys EDT in 2000

In October 2000 Poof acquired the Educational Design Toys (EDT) division of Educational Design LLC, a maker of test preparation materials. EDT, founded in 1969, made science and educational toys including the Space Theater Planetarium and Mini Lab Science Kits. Early the next year Poof bought the assets of another educational and science toy maker, Patail Enterprises, Inc. of Laguna Niguel, California. The EDT and Patail product lines were subsequently marketed under the Slinky Science brand name. In February 2003 the firm also bought Ideal Toy, located in Ronkonkoma, New York. Ideal made tabletop action games including Sure Shot Baseball and Rack TNU Pocket Pool.

In January 2004 Poof Products formally merged with James Industries to become Poof-Slinky, Inc. The firm would continue to make Slinkys in Hollidaysburg, Pennsylvania, and foam toys in Plymouth, Michigan, with a few other items contracted out to manufacturers overseas. Dallavecchia and Ferner had long since bought back the outstanding shares of stock sold in the 1990s to assume full ownership of the firm. Slinky matriarch Betty James was now retired, but the family connection was maintained through her eldest son Tom, who worked for the company as head of special market sales.

The year 2004 also saw production begin on a new animated film which was to feature the company's Slinky Pets line along with other Slinky spring toys. The film, tentatively entitled The Magic Quilt, was slated for release in the fall of 2005. Its production company, H2V Kids of Montreal, Canada, had hopes to produce a second feature film and a television series as well.

By now Poof-Slinky had reduced its product lineup to a total of 65 items, which included a variety of balls, foam rockets, and airplanes, along with the Slinky and Slinky Science lines and several Ideal games. The company's toys were available in over 20,000 stores worldwide.

With roots going back nearly 60 years, Poof-Slinky, Inc. had established a solid niche for itself in the toy marketplace. Its production of the classic Slinky, as well as a variety of foam toys, games, and educational products, gave it a proven lineup that generated steady sales.

Key Dates:

Betty and Richard James begin marketing the Slinky spring toy.
Slinky Train, Dog, and other variations are introduced.
Richard James departs for Bolivia, leaving Betty to run firm.
Sales are boosted by television advertising campaign with "It's Slinky" song.
Plastic Slinky is introduced.
Poof Products is formed to make foam toys.
Richard Dallavecchia and Doug Ferner buy Poof Products.
Slinky celebrates 50th anniversary; Slinky Dog is featured in Toy Story film.
Poof begins selling stock via online offering; acquires Chasco.
James Industries, Inc. is acquired by Poof Products.
Educational Design Toys is bought by Poof.
Patail Enterprises, Inc. is purchased.
Game maker Ideal Toy is acquired.
Poof and James Industries merge to become Poof-Slinky, Inc.

Principal Competitors

Hasbro, Inc.; Wham-O, Inc.; JAKKS Pacific, Inc.; Toy Quest.

Further Reading

Fish, Mike, "At Danforth Awards, Everyone Knows It's Slinky," Post-Standard (Syracuse, N.Y.), April 28, 1995, p. B6.

Giarrusso, Michael A., "Despite Newfound Stardom, Slinky Dog Not on the Market," Associated Press, December 18, 1995.

Gibb, Tom, "Celebrated Slinky Toy Is 50 Years Old This Month," Harrisburg Patriot, March 20, 1995, p. B3.

Harvey, Robin, "'It's Slinky, It's Slinky!' And Now It's 50," Toronto Star, March 30, 1995, p. D1.

"Helen Malsed, Inventor of Slinky Toys," Associated Press Newswires, November 17, 1998.

Nelson Jones, Diana, "Slinky Always Bounces Back," Grand Rapids Press, December 26, 2003, p. A11.

Palasri, Sirin, "Toy Firm Set for Offering on the Net," Nation, December 9, 1996.

Serwach, Joseph, "IPO Sounds Like a Soft Sell: Toy Firm to Use Internet," Crain's Detroit Business, July 28, 1997, p. 1.

, "New Slinky Pets Pursue Beanie Babies' Success," Crain's Detroit Business, August 3, 1998, p. 1.

Shellenbarger, Pat, "That Slinking Feeling," Grand Rapids Press, May 23, 1995, p. C1.

"Slinky Matriarch Headed for Toy Industry Hall of Fame," Associated Press Newswires, January 22, 2001.

"Suburban Detroit Company Buys Maker of Slinky Toys," Associated Press Newswires, July 18, 1998.

"This Immortal Coil," Express, October 16, 1999.

Thomas, Karen, "Forever Slinky," USA Today, December 1, 1995, p. 1D.

Witchell, Alex, "Persevering for Family and Slinky," New York Times, February 21, 1996, p. C1.

Frank Uhle