UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
FORM
10-K
(Mark One)
☒ ANNUAL
REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the fiscal year ended: December 31, 2025
or
☐
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For
the transition period from ____________ to _____________
Commission
File Number: 001-41038
STRAN & COMPANY, INC.
(Exact name of registrant as specified in its charter)
(Address of principal executive offices) (Zip Code)
(Registrant’s telephone number, including area code)
Securities
registered pursuant to Section 12(b) of the Act:
Title of each class Trading Symbol(s) Name of each exchange on which registered
Common Stock, par value $0.0001 per share SWAG The Nasdaq Stock Market LLC
Securities
registered pursuant to Section 12(g) of the Act: None
Indicate
by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes ☐No ☒
Indicate
by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes ☐No ☒
Indicate
by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange
Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2)
has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐
Indicate
by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule
405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit such files).
Yes ☒ No ☐
Indicate
by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting
company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,”
“smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.
Large accelerated filer ☐ Accelerated filer ☐
Non-accelerated filer ☒ Smaller reporting company ☒
Emerging growth company ☒
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Indicate
by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness
of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act by the registered public accounting firm
that prepared or issued its audit report. ☐
If
securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant
included in the filing reflect the correction of an error to previously issued financial statements. ☐
Indicate
by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation
received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b). ☐
Indicate
by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ☐
No ☒
As
of June 30, 2025 (the last business day of the registrant’s most recently completed second fiscal quarter), the aggregate market
value of the registrant’s shares of common stock held by non-affiliates (based upon the closing price of such shares as reported
on The Nasdaq Stock Market LLC) was $14,207,087. Shares held by each executive officer and director and by each person who owned more
than 10% of the outstanding shares of common stock have been excluded from the calculation in that such persons may be deemed to be affiliates
of the registrant. This determination of affiliate status is not necessarily a conclusive determination for other purposes.
As
of March 23, 2026, there were a total of 18,690,158 shares of the registrant’s common stock outstanding.
DOCUMENTS
INCORPORATED BY REFERENCE
None.
STRAN
& COMPANY, INC.
Annual
Report on Form 10-K
Year
Ended December 31, 2025
TABLE
OF CONTENTS
Page
PART I - FINANCIAL INFORMATION
Item 1. Business 1
Item 1A. Risk Factors 20
Item 1B. Unresolved Staff Comments 40
Item 1C. Cybersecurity 40
Item 2. Properties 42
Item 3. Legal Proceedings 42
Item 4. Mine Safety Disclosures 42
PART II - OTHER INFORMATION
Item 6. [Reserved] 43
Item 7A. Quantitative and Qualitative Disclosure About Market Risk 54
Item 8. Financial Statements and Supplementary Data 54
Item 9A. Controls and Procedures 54
Item 9B. Other Information 56
Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections 56
PART III
Item 10. Directors, Executive Officers and Corporate Governance 57
Item 11. Executive Compensation 61
Item 14. Principal Accountant Fees and Services 79
PART IV
Item 15. Exhibits and Financial Statement Schedules 81
Signatures 83
i
INTRODUCTORY
NOTES
Use of
Terms
Except
as otherwise indicated by the context and for the purposes of this Annual Report on Form 10-K only, references to “we,” “us,”
“our,” and the “Company” are to Stran & Company, Inc., a Nevada corporation, and its consolidated subsidiaries;
references to “Stran” or “Stran & Company, Inc.” are to Stran & Company, Inc., a Nevada corporation;
references to “Stran Loyalty Solutions” or “SLS” are to Stran Loyalty Solutions, LLC, a Nevada limited liability
company and a wholly-owned subsidiary of Stran & Company, Inc.; and references to “Gander Group Louisiana” are to Gander
Group Louisiana, LLC, a Louisiana limited liability company, a wholly owned subsidiary of Stran Loyalty Solutions.
Note
Regarding Trademarks, Trade Name and Service Marks
We
use various trademarks, trade name and service marks in our business, including “STRÄN,” “STRÄN promotional
solutions,” “Stran Promotional Solutions,” and “Gander Group.” For convenience, we may not include the
SM, ® or TM symbols, but such omission is not meant to indicate that we would not protect our intellectual
property rights to the fullest extent allowed by law. Any other trademarks, trade name or service marks referred to in this report are
the property of their respective owners.
Note
Regarding Industry and Market Data
This
report includes industry data and forecasts that we obtained from industry publications and surveys including but not limited to certain
publications of the promotional products member groups Advertising Specialty Institute (“ASI”) and the Promotional Products
Association International (“PPAI”), as well as public filings and internal company sources. Industry publications, surveys
and forecasts generally state that the information contained therein has been obtained from sources believed to be reliable, but there
can be no assurance as to the accuracy or completeness of the included information. Statements as to our ranking, market position and
market estimates are based on third-party forecasts, management’s estimates and assumptions about our markets and our internal
research. We have not independently verified such third-party information, nor have we ascertained the underlying economic assumptions
relied upon in those sources, and we cannot assure you of the accuracy or completeness of such information contained in this report.
Such data involve risks and uncertainties and is subject to change based on various factors, including those discussed under Item 1A.
“Risk Factors” and “—Note Regarding Forward-Looking Statements” below.
Note Regarding
Forward-Looking Statements
This
report contains forward-looking statements that are based on our management’s beliefs and assumptions and on information currently
available to us. All statements other than statements of historical facts are forward-looking statements. These statements relate to
future events or to our future financial performance and involve known and unknown risks, uncertainties and other factors that may cause
our actual results, levels of activity, performance or achievements to be materially different from any future results, levels of activity,
performance or achievements expressed or implied by these forward-looking statements. Forward-looking statements include, but are not
limited to, statements about:
● our goals and strategies;
● our business development, financial condition and results of operations;
● expected changes in our revenue, costs or expenditures;
● growth and competition trends in our industry;
ii
● future relevant government policies and regulations relating to our industry.
In
some cases, you can identify forward-looking statements by terms such as “may,” “could,” “will,”
“should,” “would,” “expect,” “plan,” “intend,” “anticipate,”
“believe,” “estimate,” “predict,” “potential,” “project” or “continue”
or the negative of these terms or other comparable terminology. These statements are only predictions. You should not place undue reliance
on forward-looking statements because they involve known and unknown risks, uncertainties and other factors, which are, in some cases,
beyond our control and which could materially affect results. Factors that may cause actual results to differ materially from current
expectations include, among other things, those listed under Item 1A. “Risk Factors” and elsewhere in this report.
If one or more of these risks or uncertainties occur, or if our underlying assumptions prove to be incorrect, actual events or results
may vary significantly from those implied or projected by the forward-looking statements. No forward-looking statement is a guarantee
of future performance.
In
addition, statements that “we believe” and similar statements reflect our beliefs and opinions on the relevant subject. These
statements are based upon information available to us as of the date of this report, and while we believe such information forms a reasonable
basis for such statements, such information may be limited or incomplete, and our statements should not be read to indicate that we have
conducted an exhaustive inquiry into, or review of, all potentially available relevant information. These statements are inherently uncertain
and investors are cautioned not to unduly rely upon these statements.
The
forward-looking statements made in this report relate only to events or information as of the date on which the statements are made in
this report. Except as expressly required by the federal securities laws, there is no undertaking to publicly update or revise any forward-looking
statements, whether as a result of new information, future events, changed circumstances or any other reason.
Summary
of Risk Factors
The
following is a summary of material risks that could affect our business. This summary may not contain all of our material risks, and
it is qualified in its entirety by the more detailed risk factors set forth under Item 1A. “Risk Factors”.
iii
● There is a risk of dependence on one or a group of customers.
iv
● Volatility in the global financial markets could adversely affect results.
v
PART
I
ITEM 1. BUSINESS.
Overview
We
are an outsourced marketing solutions provider, working closely with our customers to develop sophisticated marketing programs that leverage
our promotional products and loyalty incentive expertise. We develop long-term relationships with our customers, enabling them to connect
with both their customers and employees in order to build lasting brand loyalty. It is our mission to drive brand awareness and affect
behavior through visual, creative, and technology solutions.
We
purchase products and branding through various third-party manufacturers and decorators and resell the finished goods to customers. In
addition to selling branded products, we offer our clients custom sourcing capabilities; a flexible and customizable e-commerce solution
for promoting branded merchandise and other promotional products, managing promotional loyalty and incentives, print collateral, and
event assets, order and inventory management, and designing and hosting online retail popup shops, fixed public retail online stores,
and online business-to-business service offerings; creative and merchandising services; warehousing/fulfillment and distribution; print-on-demand;
kitting; point of sale (POS) displays; and loyalty and incentive programs.
These
valuable services, as well as the deep level of commitment we have to the business operations of our customers, have resulted in a strong
and stable position within the industry.
We
specialize in managing complex promotional marketing programs to help recognize the value of promotional products and branded merchandise
as a tool to drive awareness, build brands and impact sales. This form of advertising is very powerful and impactful and particularly
effective at building brand loyalty because it typically uses products that are considered useful and appreciated by recipients and are
retained and used or seen repeatedly, repeating the imprinted message many times without adding cost to the advertiser. We have built
the tools, processes, relationships and the blueprint to maximize the potential of these products and deliver the most value to our customers.
For
over 30 years we have grown into a leader in the promotional products industry, ranking 12th on PPAI’s Top 100 Distributors
2025 list and 23rd on ASI’s Top 40 Distributors 2025 list. Our co-founder and Chief Executive Officer and President,
Andrew Shape, was also named 2023 Person of the Year by promotional products industry periodical Counselor. Since our first year
of operations in 1995, our annual revenues have gradually grown from approximately $240,000 to approximately $116.2 million in 2025,
a compound annual growth rate of approximately 23%, and between 2019 and 2025, our revenues grew at a compound annual growth rate of
approximately 25%.
As
of December 31, 2025, we had total assets of approximately $49.3 million with total stockholders’ equity of $30.5 million.
We
serve a highly diversified customer base across many industry verticals including pharmaceutical and healthcare, manufacturing, gaming,
technology, finance, construction and consumer goods. Many of our customers are household names and include some of the largest corporations
in the world.
Our
sales increased 40.6% year-over-year in 2025 compared to 2024, which was primarily due to higher spending from existing clients as well
as business from new customers. Additionally, we benefited from the acquisition of substantially all of the assets (the “Gander
Group Assets”) of Bangarang Enterprises, LLC, a California limited liability company (d/b/a Gander Group) (“Gander Group”),
in August 2024.
1
Our
headquarters are located at Quincy, Massachusetts, with additional offices located in Warsaw, Indiana; Mt. Pleasant, South Carolina;
Walpole, Massachusetts; Tomball, TX; and Irvine, California. We also have sales representatives in 22 additional locations across the
United States and a network of service providers in the U.S. and abroad, including factories, decorators, printers, logistics firms,
and warehouses.
Our
Industry
Overview
of Promotional Products Market
The
promotional products industry is large yet highly-fragmented, with thousands of smaller participants and indications of a lack of market
power in any one firm or group of firms. The industry has generally experienced growth as businesses continuously invest in sophisticated
marketing campaigns involving multiple types of advertising. Promotional products are items used to promote a product, service or company
program including advertising specialties, premiums, incentives, business gifts, awards, prizes, commemoratives and other imprinted or
decorated items. They are usually given away by companies to consumers or employees. The largest promotional products trade organizations
are ASI and PPAI.
U.S.
Promotional Products is a Large and Growing Market
According
to ASI, the market for promotional products sales reached a record high of $27.7 billion in 2025. Moreover, the promotional products
market is only one segment of a total addressable market of possibly up to $410 billion, based on the size of the promotional products
market ($27.7 billion in 2025 according to ASI); the product packaging market ($185 billion as of 2021, according to Mordor Intelligence,
a leading market intelligence and advisory firm); the loyalty incentive programs market ($90 billion annually according to the Incentive
Marketing Association, the umbrella organization for suppliers in the incentive marketplace); the printing market ($86.6 billion projected
for 2026, according to IBISWorld, an industry research provider); and the trade show and conference planning market ($24.2 billion projected
for 2025, according to IBISWorld).
The
Promotional Products Industry Is Resilient To Other Forms of Advertising
The
promotional products industry is relatively insulated from other forms of advertising such as television and digital advertising. Although
promotional products compete for space within an advertising budget with other forms of advertising, particularly online advertising,
they offer distinct benefits, particularly due to their physical nature, which may help distributors and suppliers continue to sell these
products and related services despite these budgetary pressures. Data shows that promotional products are more effective in generating
brand recognition and sales than other forms of advertising, including television and online advertisements. These factors help shield
established industry firms like ours from the technological and competitive disruption experienced by other types of media advertisers.
The
Promotional Products Industry is Highly Fragmented
The
promotional products industry is also highly fragmented. As of 2025, the firm with the greatest percentage of industry sales generated
$1.4 billion in sales but made up only approximately 4.9% of the $27.7 billion in sales generated in 2025 by promotional products distributors,
based on information reported by ASI and the firm itself. As a group, the top 40 distributors had approximately 38.5% market share as
of 2025, based on total sales of approximately $10.2 billion out of total promotional products distributors’ revenues for 2024
of $26.6 billion, based on ASI’s reports.
Unlike
our company, which provides comprehensive solutions to complex promotional and branding challenges, we view most of our competitors as
generally falling into one of the five categories below:
2
Promotional
Products are a High-impact, Cost-effective Advertising Medium
Because
promotional products are useful and appreciated by recipients, they are retained and used, repeating the imprinted message many times
without added cost to the advertiser. ASI’s Global Ad Impressions Study, 2023 Edition, reported:
According
to Product Power 2026, a consumer research study conducted by PPAI among more than 5,000 respondents in the United States, branded
merchandise is increasingly associated with personal relevance, appealing design, and emotional connection. The study found that promotional
products are often perceived as meaningful experiences rather than simple giveaways. Approximately 83% of consumers reported that receiving
a promotional product makes them feel appreciated, and about 90% indicated that such items positively influence their perception of the
brand. In addition, roughly 72% of respondents linked branded merchandise with positive emotions, including feelings of pride, belonging,
and gratitude. PPAI’s research suggests that these emotional responses can contribute to stronger brand recall and retention, two
factors that are widely recognized as important drivers of long-term brand engagement.
Competitive
Strengths
We
believe our key competitive strengths include:
3
Growth
Strategies
The
key elements of our strategy to grow our business include:
4
We
believe that this strategy and experience will help us to pursue suitable acquisition opportunities in the future and integrate them
successfully. Consistent with this strategy, we continue to evaluate potential acquisition targets, particularly with the following attributes:
Other
strategies that we plan to implement to expand our customer base with expanded sales staff and technology resources include:
5
Products
and Services
Overview
Since
our inception over 30 years ago, we have provided clients with marketing services that help drive sales, and make an impact using custom-branded
merchandise, commercial print, loyalty and incentive programs, packaging and POS solutions while providing a technology solution to deliver
these products and services efficiently via our warehouse and fulfillment system.
Our
value to our customers is to be an extension of their own teams. We work to understand the different business and marketing goals of
each customer and provide solutions that incorporate technology, human capital, and physical branded goods to solve their business challenges.
This model of outsourced combined marketing and program-management services is unique in the promotional products industry, which is
dominated by online e-tailers, franchisees, and mom-and-pop businesses. To achieve this value, we have built the internal resources,
knowledge, and processes to support our clients with more than just commodity items.
We
are both program managers and creative marketers, having developed multiple teams within our organization to specialize and focus our
efforts on supporting customers with the specific support that they need:
6
We
work closely with industrial designers of several of our key collaborators to understand the research and trends that are influencing
product development in the six- to 18-month window ensuring that our team is up-to-date on trends in the industry.
Promotional
Product Programs
We
run complex corporate promotional marketing programs for clients across many different industry verticals. Most of our clients take advantage
of all the services we provide; however, at the core of every program are the promotional products themselves. Our team works diligently
to stay on point with the current trends so our clients’ branded products are relevant. We distribute a wide variety of promotional
products to our customers, with the most popular promotional products including wearables, writing utensils, drinkware, technology and
events-related products.
Loyalty
and Incentives Programs
We
build custom solutions for customers looking to drive either customer or employee behavior. We help our customers build a customer loyalty
program or an employee incentive program that meets each customer’s specific needs. Our solutions can include gamification tools,
social media integration, and a points-based plan that rewards clients’ users with a combination of physical products, digital
rewards, gift cards, and experiential rewards nurturing loyalty to their brand. For example, we worked closely with a global producer
of vaccines and medicines for animals, to design and implement a two-tier incentive program in which, on one tier, veterinarians were
incentivized to purchase from our customer through providing them with promotional branded products, and, on a second tier, a loyalty
points program featuring prepaid debit card rewards for end-user pet owners who buy their products.
In
developing our loyalty and incentive offering, Stran has taken a similar approach as we have in other areas of our business. Instead
of developing our own internal solutions organically, we have sought out relationships with businesses with a variety of offerings that
meet the very different needs of each of our customers. By using a collection of third-party providers, we are able to offer a more robust
technology solution that meets the constantly evolving and changing needs of our incentive users.
Packaging
and Point of Sale
Presentation
makes all the difference. Clever and custom packaging and POS displays are essential for elevating brand awareness and critical for driving
sales. From packaging of corporate merchandise and promotional products to developing custom POS displays, clients come to us when they
want to stand out and show the quality that their brands offer. We produce custom packaging and POS projects domestically as well as
overseas for larger-run custom programs for many of our clients.
7
Commercial
and Digital Printing
Printed
informational materials used for marketing, or marketing collateral, such as business cards and brochures, are an essential component
to effectively conveying information and marketing messages, and arguably all businesses use some form of marketing collateral. Our new
Digital Solutions initiative supports increasing client demand for quick-turn, small-batch digital printing, centralized brand asset
management, CRM-integrated campaign execution, and self-service ordering portals. When a customer needs print collateral, our digital
print-on-demand options route their orders through our technology platform and to our network of commercial printers to ensure that our
customers can print each piece of collateral in the most effective and efficient manner. By offering print management with our promotional
branded merchandise solutions, we help our customers create impactful presentations and mailings through the most efficient processes.
Warehouse
and Fulfillment
We
offer a global solution for warehousing and fulfillment through a network of fulfillment providers including a 15-year relationship with
industry leader Harte Hanks. These long-standing, strategic relationships provide our clients with process-driven fulfillment solutions
that are scalable to meet client needs including real-time inventory reporting, climate-controlled facilities, high-value product security,
storage, digital print-on-demand, and direct-mail solutions. Our custom front-end technology solution is directly integrated with the
warehouse management software of our strategic global warehouse collaborators.
In
addition to continuing to use our third-party logistics partners like Harte Hanks, we have expanded our in-house warehouse, decoration,
and fulfillment capabilities. Our acquisition of the business and assets of T R Miller Co., Inc., a Massachusetts corporation (“T
R Miller”), provides us with an approximately 25,000-square-foot warehouse, production, and distribution center in Walpole, Massachusetts.
We leverage this facility to offer our customers specialty fulfillment, kitting, and warehousing, allowing us greater control and flexibility
to meet the complex demands of our customers.
Technology
Our
custom-developed e-commerce Magento Open Source platform allows our customers to manage all facets of their marketing program, linking
branded merchandise, print, event assets, customer relationship management, or CRM, loyalty and incentives in a single solution. Our
platform creates cost savings, increasing market efficiencies and brand consistency. With real-time accessibility to the necessary data
to operate a complex demanding marketing program including hierarchy user profile groups, multi-lingual, multi-currency, multi-checkout
methods and integration into many major ERP systems (SAP ERP, NetSuite ERP, Workday, etc.). Our on-demand mobile reporting dashboard
capabilities allows the ability for self-service access within our systems empowering clients with raw data to make informed decisions
for their program.
We
have also invested in an internal commercial Enterprise Resource Planning (ERP) system, Oracle/NetSuite’s NetSuite ERP, which is
expected to enhance the process of gathering and organizing the business data of our company through an integrated software suite, and
was launched in the first half of 2025. Additional NetSuite phases will be planned and rolled out in the future as necessary. NetSuite
combines accounting, order management, inventory, CRM, and presentation functionality. We believe that this ERP will reduce inefficiencies,
expenses and headcount, automate current manual processes, and potentially contribute to growing net revenues.
Human
Capital and Culture
We
are more than an efficient distributor or supplier, and we offer our customers more than just products. We help them achieve their marketing
and business goals using branded merchandise supported with technology, logistics, creative services, and account support. In order to
provide all of these value-added services, we must leverage and cultivate the talent of our employees.
As
an organization we encourage our team to engage with professional development opportunities. These opportunities include online courses,
webinars, training sessions, and participation in various networking and professional development groups. As such we currently have a
member of our team who serves on the board of directors for NEPPA (New England Promotional Products Association), a regional trade association,
as well as a member of Chief, a network of 20,000 women executives, representing 10,000 companies and 77% of the Fortune 100, designed
specifically for women executives to strengthen their leadership and maximize their business impact. Empowering our team to
grow their own careers helps ensure that we are more knowledgeable, experienced, and engaged.
8
Pricing
As
a large and growing firm with over 500 suppliers and due to our membership in Facilisgroup, Stran has the purchasing power to receive
advantageous pricing, helping us with price-sensitive bids. Facilisgroup, a buying group of fewer than 1% of distributors in the industry,
processed over $1.5 billion of sales in 2024. Pursuant to our Sublicense Agreement, we may access Facilisgroup’s @ease proprietary
software tools for promotional products business management and analysis and a white labelled, managed, product website which we may
use to sell promotional products under our brand. We may also access its “Signature Collection” website which Facilisgroup
promises offers the best products and margins.
In
addition to this competitive buying power, Stran has developed factory direct relationships with multiple factories in the U.S. and overseas.
These direct relationships require additional vetting, longer production times, and larger production runs. However, we work to blend
production from factory direct manufacturing with our other suppliers to continue to drive costs down on commodity-based items. We compete
regularly with larger competitors and maintain healthy margins using this strategy for sourcing and procuring products.
Supplier
and Fulfillment Relationships
We
have formed strategic relationships with fulfillment and commercial print providers in the United States in order to effectively warehouse
and distribute merchandise from one or more of our warehouse facilities depending on our customer’s requirements. For over 30 years,
we have developed these strategic relationships in order to offer our clients a powerful solution for their branded merchandise needs.
Together, we have experience in developing custom marketing solutions for our clients and regularly kit together promotional printed
items and branded product into a single package. Our expertise in product development and sourcing, technology development, and program
management combined with our various collaborators’ superior warehousing, logistics, fulfillment, distribution and print services
are a competitive advantage.
We
offer a global solution for warehousing and fulfillment through a network of fulfillment providers including a 15-year relationship with
industry leader Harte Hanks. We buy products and certain raw materials from a supplier network of factories, both domestic and international,
as needed. We also outsource certain technology services such as web hosting and data backup. We do not believe that we are dependent
on any supplier. Should any of these suppliers terminate their relationship with us or fail to provide the agreed-on services, we believe
that there would be sufficient alternatives to continue to meet customer demand and comply with our contractual obligations without interruption.
Marketing
We
have a direct sales team consisting of over 50 outside sales representatives and 25 in-house sales representatives. We incentivize our
representatives with a competitive compensation, incentive, and commission structure.
Our
marketing approach combines the sales funnel concept of the marketing process with digital and in-person marketing efforts. We market
to a large number of prospects at the top of the sales funnel to make them aware of our business and our products and services by combining
lead-generation activities with digital marketing, including website content, SEO, paid ads, and email list promotions, and in-person
activities including tradeshow and other events. We use targeted emails, social media messages, and other digital and in-person lead-nurturing
activities, develop case studies, and apply other digital and in-person sales tools to market to prospects that demonstrate interest
in our business. For prospects that demonstrate readiness to buy and reach the bottom of the sales funnel, we use tools such as sales
presentations, sales proposals, and sell sheets.
9
Our
efforts in in-person marketing include expanding the number of tradeshows and conferences that we attend and sponsor across different
industry verticals. At these tradeshows, we plan to target representatives of specific industry verticals, such as the beverage industry
or the gaming market, and a variety of professionals attending events focused in the areas of marketing or procurement development.
In
addition to efforts to develop new business opportunities, our marketing team works closely with our sales team and our managers to develop
opportunities from existing customer accounts. With existing customers, we are seeking to cross-sell and expand our services to encompass
all employee, customer, and partner loyalty and engagement programs that are designed to reward loyalty through a combination of premium
products, branded merchandise, and digital and experiential rewards.
Customers
and Markets
Stran’s
customer base includes approximately 2,000 active customers and over 30 Fortune 500 companies, servicing a diverse customer base, encompassing
pharmaceutical and healthcare, manufacturing, gaming, technology, finance, construction and consumer goods. Our active customers are
any organizations, businesses, or divisions of a parent organization which have purchased directly or indirectly from us within the last
two years, and include organizations that have bought from other organizations for which Stran acts as an established subcontractor.
We have long-term contracts with many of our customers, though most do not have minimum guarantees. We have ongoing contracts with clientele
in such industries as financial services, casino gaming, consumer packaged goods, retail clothing and accessories, pet food and medicine,
fitness, childcare, retail hardware, fast food franchises, healthcare, and environmental services. Contracts are often multi-year and
auto-renewing. Our average contract lifespan is approximately 10 years. Alternatively, we do have inventory guarantees where the customer
must purchase any inventory held by us that has been purchased on their behalf within the contractual time periods. Our active customers
may be broken into two main categories, transactional clients and program clients.
During
2025, sales to our largest two customers were 7.2% and 5.2% of total revenue, respectively. During 2024, sales to our largest two customers
were 8.4% and 6.8% of total revenue, respectively. All other customers generated less than 5% of sales, and the vast majority generated
less than 1% of sales.
While
our customer contracts are typically auto-renewing and we have many long-term established customer relationships, most of our customer
contracts do not have any minimum or exclusive purchase guarantees, other than as to inventory already ordered by them or their program
participants. There is no assurance of recurring revenues. We are not dependent on any particular customer or group of customers, and
our highest-grossing contracts may change from year to year due to client brand initiatives.
We
do business principally with customers based in the United States, although we also provide e-store, logistical support and other promotional
services for client programs in Canada and Europe.
Online
Store
We
have been a leader in the use of technology to offer our clients an online platform to more efficiently manage their promotional marketing
programs and to give them the ability to sell branded merchandise directly to consumers. We launched our first online store for one of
our clients in 1999. Today we offer a custom-built technology platform which offers a B2C (business-to-consumer) retail shopping experience
combined with all of the back-end functionality required of a powerful B2B (business-to-business) marketing services platform. Our technology
platform services over 280 online stores for our clients.
Our
Online Store Account Managers are responsible for ensuring that our stores are up to date with all products, images, and descriptions.
As new products are approved to be added to the online store, our account manager will work the appropriate resources to prep the images,
write the descriptions and upload the images. Typically, this process will take 24-48 hours. For inventoried products, we typically do
not make the products live on the website until they have been received into inventory and are ready to be fulfilled.
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If
there is an issue with an online store, we have dedicated account-specific customer service teams who support all aspects of order fulfillment
that the user can contact to help resolve. If there is a back-order situation where an order would not be able to ship complete or on
time, the appropriate team will review the order and advise the customer on the best and timeliest options to fulfill the order.
Competition
Our
major competitors include companies such as 4Imprint Group plc (LSE: FOUR.L), Brand Addition Limited (The Pebble Group plc) (LSE: PEBB),
BAMKO LLC (Superior Group of Companies, Inc.) (Nasdaq: SGC), Staples Promotional Products (Staples, Inc.), Boundless Network, Inc., Custom
Ink, Cimpress plc (Nasdaq: CMPR), HALO Branded Solutions, Inc., Imagine This (Shye West, Inc.), Power Promotions, Inc. and Global Promotional
Sourcing, LLC. We also compete with a multitude of foreign, regional and local competitors that vary by market. If our existing or future
competitors seek to gain or retain market share by reducing prices, we may be required to lower our prices, which would adversely affect
our operating results. Similarly, if customers or potential customers perceive the products or services offered by our existing or future
competitors to be of higher quality than ours or part of a broader product mix, our revenues may decline, which would adversely affect
our operating results.
Our
Program Management
We
are experienced and industry-leading program managers who integrate all aspects of a successful program. Our program team works hand
in hand with our account teams to drive the processes and procedures that ensure we are effectively managing our programs. For Stran,
program management is built upon six key building blocks:
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Under
our agreement with Harte Hanks, as amended and supplemented, we may subcontract to Harte Hanks one or multiple functions as appropriate,
such as e-store website setup; ongoing website inventory management services; monthly account management services; and print-on-demand,
warehousing, fulfillment, pick/pack/ship, and other inventory management services. Costs and fees depend on types of services provided
and any special or custom work that we request on behalf of our customers.
In
addition to continuing to use our third-party logistics partners like Harte Hanks, we are expanding our in-house warehouse, decoration,
and fulfillment capabilities. Our acquisition of the business and assets of T R Miller provides us with an approximately 25,000-square-foot
warehouse, production, and distribution center in Walpole, Massachusetts. We leverage this facility to offer our customers specialty
fulfillment, kitting, and warehousing, allowing us greater control and flexibility to meet the complex demands of our customers.
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Intellectual
Property
We
conduct our business using the registered trademarks “STRÄN” and “Gander Group” as well as the
registered trade name “Stran Promotional Solutions”. We also use the unregistered logo “STRÄN promotional solutions”.
To
protect our intellectual property, we rely on a combination of laws and regulations, as well as contractual restrictions. Federal trademark
law protects our registered trademark STRÄN and Gander Group and may protect our unregistered logo “STRÄN promotional
solutions”. We also rely on the protection of laws regarding unregistered copyrights for certain content we create and trade secret
laws to protect our proprietary technology including our e-commerce platform and ERP system. To further protect our intellectual property,
we enter into confidentiality agreements with our executive officers and directors.
Seasonality
and Cyclicality
Our
business and the promotional products industry overall is generally subject to some seasonal fluctuations. The final quarter of the calendar
year is generally the strongest due to the holiday selling season and customers exhausting annual marketing budgets, while the first
quarter of the calendar year is generally the weakest due to customers planning their budgets and marketing campaigns for the upcoming
year.
Portions
of the promotional products industry are cyclical in nature. Generally, when economic conditions are favorable, the industry tends to
perform well. When the economy is weak or if there are economic disturbances that create uncertainty with corporate profits, the promotional
products industry tends to experience low or negative growth.
Security
We
regularly receive and store information about our customers, vendors and other third parties. We have programs in place to detect, contain,
and respond to data security incidents. See Item 1C. “Cybersecurity”. However, because the techniques used to obtain
unauthorized access, disable or degrade service, or sabotage systems change frequently and may be difficult to detect for long periods
of time, we may be unable to anticipate these techniques or implement adequate preventive measures. In addition, hardware, software,
or applications we develop or procure from third parties or through open-source solutions may contain defects in design or manufacture
or other problems that could unexpectedly compromise information security. Unauthorized parties may also attempt to gain access to our
systems or facilities, or those of third parties with whom we do business, through fraud, trickery, or other forms of deceiving our team
members, contractors, and vendors.
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Employees
As
of March 13, 2026, we employed 154 full-time employees, 2 part-time employees and 15 independent contractors.
We
do not believe any of our employees are represented by labor unions, and we believe that we have an excellent relationship with our employees.
Regulation
Trade
Regulations
As
disclosed above, our suppliers generally source or manufacture finished goods in parts of the world that may be affected by the imposition
of duties, tariffs or other import regulations by the United States. The Company believes that its redundant network of suppliers provide
sufficient capacity to mitigate any dependency risks from a single supplier.
We
buy promotional products from suppliers or factories both domestically and internationally as needed. We do not depend on any single
supplier. However, if we are unable to continue to obtain our finished products from international locations or if our suppliers are
unable to source raw materials, it could significantly disrupt our business. Further, we are affected by economic, political and other
conditions in the United States and internationally, including those resulting in the imposition or increase of import duties, tariffs
and other import regulations and widespread health emergencies, which could have a material adverse effect on our business.
Laws
and Regulations Relating to E-Commerce
Our
business is subject to a variety of laws and regulations applicable to companies conducting business on the internet. Jurisdictions vary
as to how, or whether, existing laws governing areas such as personal privacy and data security, consumer protection or sales and other
taxes, among other areas, apply to the internet and e-commerce, and these laws are continually evolving. For example, certain applicable
privacy laws and regulations require us to provide customers with our policies on sharing information with third parties, and advance
notice of any changes to these policies. Related laws may govern the manner in which we store or transfer sensitive information or impose
obligations on us in the event of a security breach or inadvertent disclosure of such information. Additionally, tax regulations in jurisdictions
where we do not currently collect state or local taxes may subject us to the obligation to collect and remit such taxes, or to additional
taxes, or to requirements intended to assist jurisdictions with their tax collection efforts.
The
production, distribution and sale in the United States of many of our products are subject to the Federal Food, Drug, and Cosmetic Act,
the Federal Trade Commission Act, the Lanham Act, state consumer protection laws, competition laws, federal, state and local workplace
health and safety laws, various federal, state and local environmental protection laws, various other federal, state and local statutes
applicable to the production, transportation, sale, safety, advertising, labeling and ingredients of such products, and rules and regulations
adopted pursuant to these laws. Outside the United States, the distribution and sale of our many products and related operations are