The Mighty Pen

When 25-year-old Patrick Joseph Frawley Jr. went into the ball-point-pen business in 1949, he could not have picked a worse time. The market was flooded with pens; bankers warned against writing checks with them (forgers could literally pick up a transfer of a signature); schoolteachers banned them; and retailers were swamped with complaints. But Pat Frawley was full of confidence--and with good reason. At 16 he was a salesman for his father's export-import business in Nicaragua; at 18 he negotiated a $300,000 deal between Panama and U.S. Rubber. At 23 he built a flourishing export-import business in San Francisco.

While he ran his San Francisco business with one hand, Frawley began to sell ballpoint pens, made by a Los Angeles aircraft-parts manufacturer, with the other. Before long, the manufacturer could not keep up with sales of the inexpensive (97-c-) pen, which wrote well and did not leak. Frawley bought him out for $18,000, rented a factory for $450 a month and started manufacturing Paper-Mate pens. To solve the problem of fading and transferable ink, he used a new ink that a Hungarian chemist mixed in a makeshift home lab. Frawley's first selling coup was to talk two banks into cashing checks written with his pens. Then Frawley started a big advertising campaign to plug the only pens with "bankers' approval." By using high-pressure selling in stores, bright, eye-catching counter displays, and full-page newspaper advertisements, he sold Paper-Mates when other pens could not be given away.

In 1951 Frawley sold 4,000,000 pens and decided to invade the tough New York market. Twenty-two high-pressure salesmen visited 2,400 stores in six weeks. They wrote on retailers' shirts, promised a new $15 shirt if the ink did not wash out. His salesmen gave pens to school principals, won their approval and then advertised it. In the first year he spent $30,000 for advertising. This year PaperMate is spending $5,000,000. As a result, sales climbed from $360,000 to an estimated $26 million for 1955. In six years Frawley sold 51 million pens, captured 80% of the ball-point-pen market, and made Paper-Mate one of the largest U.S. pen manufacturers.

Last week Pat Frawley cashed in on his penmanship. He sold his company to the Gillette Co. for $15.5 million in cash. After he pays the capital-gains tax, Pat Frawley will have $11.4 million left for his six years' work. Gillette bought the company in line with its policy of diversifying into home permanent kits, shampoo and lipstick, in addition to blades. Hired to run Gillette's new ball-point-pen division: Pat Frawley, 31.

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