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                                                                Exhibit 10.3(b)


                              EMPLOYMENT AGREEMENT


     THIS AGREEMENT, made and executed in duplicate, this 1st day of June,
1997, by and between OUTLOOK GROUP CORPORATION, a Wisconsin corporation,
(hereinafter referred to as "Employer") and David L. Erdmann (hereinafter
referred to as "Employee").

     EMPLOYER AND EMPLOYEE AGREE, for the consideration of the mutual promises
and agreements hereinafter set forth, as follows:

1.   EMPLOYMENT.  Employer agrees to employ Employee as Chairman of the Board
     and Chief Executive Officer to perform the duties related to said
     positions, and Employee hereby accepts and agrees to such employment.
     Employee shall perform the duties as are customarily performed by one
     holding such positions in a business such as Employer's.  Employee shall
     also unconditionally render other and related services and duties as
     Employer may assign to him or ask of him from time to time. Employer
     reserves the right to change from time to time the nature and scope of
     Employee's duties and position.

2.   COMPENSATION.  Employer agrees to pay Employee during the term of this
     Agreement, a compensation consisting of a salary to be determined
     annually, along with an incentive earnings opportunity, also to be
     determined annually, as provided in "Exhibit A", attached, which is a part
     of this Agreement.

     All compensation shall be subject to the customary withholding tax and
     other employment taxes as required with respect to compensation paid by a
     corporation to an employee.  Employee shall not be entitled to any other
     compensation except as expressly provided for in this Agreement, or as
     provided for by the Compensation Committee of the Board of Directors.

3.   SERVICES AND BEST EFFORTS OF EMPLOYEE.  Employee agrees that he will at
     all times faithfully, industriously, and to the best of his ability,
     experience, and talent perform all the duties that may be required of him
     pursuant to the express and implicit terms hereof, to the reasonable
     satisfaction of Employer.  Employee agrees to devote his entire working
     time and attention to the performance of his duties for the Employer,
     except for authorized vacation periods or periods of illness.

     The expenditure of reasonable amounts of time for personal business,
     charitable, and professional business, charitable, and professional
     activities shall not be deemed a breach of this Agreement provided such
     activities do not materially interfere with the services to be rendered
     for Employer hereunder.

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4.   TERM AND TERMINATION.  The term of employment is for three (3) years,
     beginning June 1, 1997, and is renewable June 1, 2000. However, the
     agreement may be terminated by either party, at any time, with or without
     cause or reason, upon thirty (30) calendar days written notice being given
     to the other party of such termination.  In the event of Employer
     initiated termination for any reason, other than dishonesty, fraud which
     has an adverse impact on the Employer in excess of Ten Thousand Dollars
     ($10,000.00) in the aggregate, or violation of paragraphs 8 or 9 of this
     agreement, the Employee shall be entitled to receive his bi-weekly salary
     each two weeks for a period of twenty-six (26) two-week periods following
     the termination date.  (Also, employee will receive any bonus earned
     through the last day of active employment.)

     However, if there is a change of control of the employer and the
     employee is terminated within the restrictions listed above said
     employee shall be entitled to continue in the Corporate Benefit
     Programs as addressed in Point #7 plus receive his bi-weekly
     salary each two weeks for a period of fifty-two (52) two-week
     periods following the termination date.  (Also, employee will receive
     any bonus earned through the last day of active employment.)

5.       VACATION.  Employee shall be entitled to the number of vacation days
         authorized from time to time by Employer.  If vacation is not taken, 
         the same shall not become cumulative, nor shall the Employee draw
         extra compensation if he does not take his vacation.  The time of
         Employee's vacation shall be determined by the Employee, with
         provision for on-going business responsibilities during his absence
         arranged by the Employee.
        
6.       EXPENSE REIMBURSEMENT.  During the period of his employment, Employee
         shall be reimbursed for all of his reasonable and necessary expenses
         actually incurred in the performance of service and duties for
         Employer, in accordance with the general policy of Employer,
         authorized and adopted from time to time.  Employee's expenses shall
         be recorded on an itemized expense account.
        
7.       EMPLOYEE BENEFITS.  During the period of his employment, Employee shall
         be entitled to participate in Employee benefit plans authorized and
         adopted from time to time by Employer, and any other benefits
         authorized by the Compensation Committee of the Board of Directors.
        
8.       COVENANT NOT TO COMPETE.  In connection with the employment of Employee
         pursuant to this Agreement, Employee hereby agrees, acknowledges, and
         recognizes that the following are important to Employer and that one
         or more of the following are expected to be or become applicable to
         this employment relationship:
         (a) on account of this employment, Employee will acquire important
         business information about Employer including but not limited to
         Employer's products and method of doing 
        





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         business, which information if used, disclosed, or applied other than
         for Employer's benefit can be expected to cause serious and
         substantial damage to Employer; (b) Employee's service with Employer
         may result in frequent contact with customers of Employer which may
         result in close relationships and the association of Employer's good
         will with Employee; (c) Employer's business information and customer
         relationships are significant assets owned by Employer which are
         developed by substantial investment of time and effort; Employer's
         business information and the identity of Employer's customers are not
         meant to be generally or specifically known by or disclosed to actual
         or potential competitor(s) of Employer;
        
         (d) Employer has a legitimate interest in protecting its business
         information and relationships; (e) Employee's skills and knowledge of
         Employer's business information and relationships are of an unique
         nature which will be further developed and acquired during Employee's
         employment with Employer: and (f) Employer has a legitimate interest
         in protecting its good will, customer lists and relationships,
         products, method of doing business, and other business information, by
         means of enforcement of this Covenant Not To Compete set forth in this
         Paragraph.

         Employee further acknowledges that in the course of his employment
         with Employer, Employee is placed in a position of trust and
         confidence by Employer with respect to Employer's methods of doing
         business and with respect to Employer's customers.  This Covenant Not
         To Compete is an inducement to cause Employer to execute this
         Agreement and as a condition and in consideration of such employment,
         and continued employment, raises, promotions and/or other benefits
         provided to Employee by Employer.
        
         Employee covenants and agrees with Employer that at all times during
         the term of his employment with Employer and for a period of twelve
         (12) months after the termination of his employment with Employer for
         any reason whatsoever, with or without cause, Employee shall not,
         either directly or indirectly, engage in or participate in any
         capacity, whether as an employee, independent contractor, owner,
         partner, stockholder, officer, director, consultant, sole proprietor,
         co-venturer, agent, or otherwise, with or without compensation, in or
         with any business enterprises, of any kind, which is competitive with
         the business in which the Employer was engaged at any time during the
         one (1) year period immediately prior to termination of Employee's
         employment with Employer. Notwithstanding the foregoing, this Covenant
         Not To Compete is not intended to prohibit the Employee from working
         for an employer having multiple divisions, one or more of which
         divisions is engaged in a business which is competitive with
         Employer's business, so long as the Employee is not employed by or
         does not provide services to or perform work for any competing
         division and so long as Employee does not disclose confidential
         information to the other employer, or any of its divisions, regarding
         any aspect of Employer's business.
        

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         This Covenant Not To Compete shall be limited to the geographical
         areas within the field or area of Employer's activities during the
         course of Employee's employment with Employer.  This Covenant Not To
         Compete applies to all competition occurring within the geographical
         area specified, even though the headquarters or office of the
         competitor may be outside of the area specified.
        
9.       CONFIDENTIAL INFORMATION AND RECORDS.  Employer is engaged or will 
         engage in a very competitive industry and marketplace.  Employer
         expects to accumulate substantial know-how and other information, at
         much effort and cost, all of which is not generally known, relating to
         all or some of the following: its existing and contemplated products,
         services, procedures, methods of doing business, machinery and
         equipment, compositions, technology, formulas, know-how, methods of
         production and providing services, research and development programs
         and plans, sales and marketing methods, existing and prospective
         customers and suppliers, customer lists, customer usages and
         requirements, financial matters, contractual and other agreements or
         business relationships, and other confidential business information,
         trade secrets and data (all hereinafter referred to as "Confidential
         Information").  This Confidential Information is essential to the
         well-being and success of Employer.
        
         Employee acknowledges that his employment entails a position of trust,
         and that Employee has or will have access to Confidential Information.
         Employee further acknowledges that such Confidential Information is
         vital to the personal development, advancement, and economic security
         of each person who looks to Employer as the principal means for
         providing continuing opportunities for personal growth and promotion,
         and that the acquisition of such Confidential Information by a
         competitor of Employer would not only injure Employer, but would also
         put Employer's personnel and their jobs in jeopardy.
        
         For the above reasons, as an inducement to cause Employer to execute
         this Agreement, and in further consideration of Employee's employment
         and continued employment, raises, promotions, and/or other benefits
         provided to Employee by Employer, Employee agrees as follows:  (i)
         except as required by Employee's duties to Employer, not to at any
         time directly or indirectly disclose to or use for others or
         appropriate for his own personal use or cause to be used by others any
         Confidential Information without first obtaining the written consent
         of Employer to do so; (ii) all records and other writings of
         Confidential Information prepared by Employee, or which come into his
         possession or control, or which he has access to, are and shall remain
         the exclusive property of
        


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         Employer, and upon termination of Employee's employment, Employee will
         not remove any such records or copies thereof, but all shall be left
         with Employer, and any such records or copies not with Employer and in
         Employee's possession or control, shall be, upon termination of
         employment, immediately returned to Employer along with any other
         property of Employer.
        
         The requirements of this Paragraph shall apply during the time of
         Employee's employment with Employer and thereafter unless it can be
         conclusively demonstrated that such Confidential Information (i) has
         through no act or fault of Employee become part of the public domain,
         or (ii) is no longer important or to be kept confidential for the
         protection or well-being of Employer.
        
10.      INJUNCTIVE RELIEF; EMPLOYEE'S ACKNOWLEDGMENT.  Employee acknowledges 
         that any actual or threatened breach of (i) the Covenant Not To
         Compete set forth herein or (ii) the provisions regarding Confidential
         Information and records set forth herein, is likely to result in
         immediate and irreparable harm to Employer.  Employee also
         acknowledges and admits that there may be no adequate remedy at law
         for his breach or a threatened breach and therefore Employer shall be
         entitled to immediate equitable relief by way of both temporary and
         permanent injunctions, (including compensatory injunctions prohibiting
         Employee from engaging in the restricted activity for the full period
         of the agreed time plus the additional period of time equal to the
         term of any violation of such restrictive covenant) and also money
         damages insofar as can be determined under the circumstances, and such
         further relief as any court with jurisdiction may deem just and
         proper.
        
         Furthermore, Employee shall be responsible to pay to Employer all
         Employer's actual and reasonable attorneys' fees and other legal costs
         occasioned by and successful enforcement of this Agreement.  Nothing
         contained in this Agreement shall prevent Employer from availing
         itself from any other right or remedy to which Employer is entitled
         under this Agreement or otherwise, and the parties agree that all
         rights and remedies available to Employer are cumulative including but
         not limited to injunctive relief, money damages from Employee.
        
         Employee further acknowledges that the restrictions (including as to
         time and geography) contained in the provisions for the Covenant Not
         To Compete and relating to the Confidential Information of Employer
         are reasonable and are not now (and are not expected to be in the
         future) onerous, harsh, or oppressive. Employee further acknowledges
         that these restrictions do not now, and are not expected to in the
         future, create or result in a hardship to Employee in pursuit of a
         livelihood or in the support of himself or his dependents, whether or
         not he is employed by Employer.  Employee further acknowledges that
         after termination of his
        

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         employment with Employer, he will be reasonably able to earn a
         livelihood without violating this Covenant Not To Compete and the
         provisions relating to Confidential Information.  Employee hereby
         agrees that the Covenant Not To Compete and the provisions relating to
         Confidential Information of Employer shall survive Employee's
         termination of employment with or without cause. Employee agrees to
         notify any prospective employer of the existence of this Agreement.
        
11.      EMPLOYER'S AUTHORITY.  Employee agrees to observe and comply with the
         rules and regulations of Employer, as adopted, created, or implemented
         from time to time by Employer's Board of Directors, respecting the
         performance of his duties.  Although Employee may be an officer or
         director of Employer, he shall have no authority whatsoever to act
         unilaterally on behalf of the Employer under this Agreement regarding
         Employer's relationship with Employee.
        
12.      PERSONAL CONTRACT.  Employer is entering into this Agreement on account
         of the skills and knowledge of Employee, and this Agreement is
         personal as to Employee.  Employee may not assign or delegate his
         rights and/or duties under this Agreement.  This Agreement shall
         automatically terminate in the event that Employee is unable or
         unwilling to perform, or does not perform, his duties of employment
         hereunder.
        
13.      MISCELLANEOUS.

         a.    No waiver or modification of this Agreement or of any
               covenant, condition, or limitation herein contained shall be
               valid unless in writing and duly executed by all parties to this
               Agreement; and no evidence of any waiver or modification shall
               be offered or received in evidence in any proceeding,
               arbitration, or litigation between the parties hereto arising
               out of or affecting this Agreement, or the rights or obligations
               of the parties hereunder, unless such waiver or modification is
               in writing, duly executed as aforesaid, and the parties further
               agree that the provisions of this section may not  be waived
               except as herein set forth.
        
         b.    The failure of Employer at any time to require performance by
               Employee of any provision expressed herein shall in no way
               affect or prejudice Employer's right thereafter to enforce such
               provision or any other provision; nor shall the waiver by
               Employer of any breach of any provision expressed herein be
               taken or held to be a waiver of such provision itself.
        
         c.    All agreements and covenants contained herein are severable,
               and in the event any of them shall be held to be invalid by any
               competent court, this contract shall be interpreted as if such
               invalid agreements or covenants were not contained herein.
        

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         d.    The captions which are underlined at the beginning of the
               paragraphs of this Agreement are chiefly for the purpose of
               convenience and if the same be in conflict with the text, the
               text shall control.
        
         e.    It is the intention of the parties hereto that this Agreement
               shall be governed by its terms and construed in accordance with
               and under and pursuant to the internal laws of the state of
               Wisconsin.
        
         f.    As used in this Agreement, words in the singular may mean the
               plural number and words used in the plural number may mean the
               singular number; and words used in any gender may mean any other
               gender.
        
         g.    This Agreement shall be binding upon and inure to the benefit
               of the parties hereto and their respective successors, assigns,
               heirs and legal representatives subject to the paragraph above
               entitled "Personal Contract."
        
         h.    All notices required under this Agreement shall be duly given
               if delivered to the other party or mailed postage prepaid to the
               respective party's last known address.  Notices shall be
               effective when personally delivered, or when sent by telegram,
               or by mail when sent by certified, registered, or regular mail
               and deposited in the United States mail, postage prepaid, and
               sent to the respective address of the other party.
        
               IN WITNESS WHEREOF, the parties have executed this Agreement on 
the date first above written and by so executing, the parties acknowledge that
they have read and fully understand all the terms and conditions included in
this Agreement and acknowledge receipt of an executed copy of this Agreement.
        
Enclosure:     Exhibit "A"


EMPLOYEE:                                          FOR THE EMPLOYER:
---------                                          -----------------


------------------------                           ---------------------------
David L. Erdmann                                   James Dillon
                                                   Compensation Committee


                                                   ---------------------------
                                                   Harold Bergman
                                                   Compensation Committee


                                                   ---------------------------
                                                   Pat Richter
                                                   Chairperson
                                                   Compensation Committee



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                                  EXHIBIT "A"

                        TO EMPLOYMENT AGREEMENT BETWEEN
                         OUTLOOK GROUP CORPORATION AND
                                DAVID L. ERDMANN

                             EFFECTIVE JUNE 1, 1997



  COMPENSATION

  1.  SALARY EFFECTIVE JUNE 9, 1997

      Employer agrees to pay Employee a bi-weekly salary, effective June 9,
      1997, of $9,615.38 each two (2) weeks ($250,000 per year equivalent) on
      its regular payroll.


  2.  INCENTIVE EARNINGS OPPORTUNITY EFFECTIVE JUNE 1, 1997

      Employee will be paid an incentive payment immediately following audit of
      Employer's 1996 fiscal year annual financial and accounting reports,
      provided the results show at least a 5% profit before taxes.  The amount
      of the incentive payment shall be discretionary, determined by the
      Compensation Committee of the Board of Directors.  The amount, if any,
      shall be guided by accomplishment of the goals and objectives submitted
      by the Employee and accepted by the Committee at the beginning of the
      fiscal year, together with acknowledgment of the difficulty of attainment
      and the conditions under which the Corporation operated during the fiscal
      year.



EMPLOYEE:                               FOR THE EMPLOYER:
---------                               -----------------   


---------------------                   ----------------------------
DAVID L. ERDMANN                        JAMES DILLON
                                        COMPENSATION COMMITTEE

                                        ----------------------------
                                        HAROLD BERGMAN
                                        COMPENSATION COMMITTEE


                                        ----------------------------
                                        PAT RICHTER
                                        CHAIRPERSON
                                        COMPENSATION COMMITTEE






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