Branded Merchandise: Zorch Cuts the Middleman

Web-based promotional materials outlet

As a manager at an office supply company, Nicole Loftus saw firsthand what's wrong with the branded-merchandise distribution industry. Between manufacturer and end customer are more than 23,000 middlemen marking up products 25% to 65%, she says. To work around this layer, Loftus, 38, founded Zorch International six years ago. Zorch—the name comes from a tech term for propelling something very quickly—is an online source for giant corporations to get mugs, hats, golf balls, and other paraphernalia printed with their logos or slogans for promotional giveaways. Such clients as AT&T (T) and BP (BP) have their own personalized, Web-based catalog of products and order them directly from a variety of suppliers. In its first eight months with Zorch, AT&T saved $11 million, Loftus says. Her 35-employee company, which takes a percentage of each purchase, has been Zorching itself: It brought in $30 million in revenue in 2007, up 400% from the year before.

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