I recently read an article on the JC Penney troubles in the past year when the new CEO decided to stop constantly doing sales for a “lower price everyday” model which I happen to like and what we subscribe to here at Corporate Casuals. Side-note: I think the reason it works for us is we are truly cheaper because we have lower costs by producing everything ourselves (and technology to do that quickly) and our customers are usually purchasing for an event which may not coincide with a sale of ours.
Anyway, I just chuckled at how sale obsessed the american consumer has become, and has been for decades. I remember when my father opened a retail sports store in our hometown of Rumson,NJ. It was called ABC Sports after our initials. He used to tell me that customers in a very affluent town outside New York would come in to purchase a $2 can of tennis balls and then comment how they could buy them 20 minutes away for 25 cents less. Why would you ever drive 20 minutes away to save 25 cents….although with inflation i’m sure that 25 cents is now $2 but you get my point. Consumers have turned shopping into a competitive event. They have lost sight of true value. Chris, our technical engineer here, would say that’s why China is in business and why most products are practically disposable. They’re made so cheaply that they don’t last just to serve the american consumer who wants cheap, cheap, cheap!! And that’s partly why the JC Penney experiment didn’t work. The second reason is these sales have turned shopping into entertainment itself. The competition of finding the best deal is half (or sometimes all) the reason people buy it. Do you think anyone at a christmas tree shop has a shopping list for necessities? No way. They typically buy these trinkets because they like it but mostly because its such a great deal.
I remember when we took over The Nature Conservancy’s merchandise program. They had lost $300K the prior year trying to run it themselves and we proposed a no inventory solution. As part of it, we took possession of the past stock they were paying to have sit in a warehouse. I suggested that we sell it all for $3-$10 as a fire sale at their world headquarters in Washington, DC. We left it in the boxes and just cut off the tops. We crudely (and intentionally) wrote the prices on cardboard in black majic marker. This substanndard merchandise sold out in a few hours. We had a 20 person line at the check out at one point and the average sale was over $100….which i bet was 3X what the average sale would be if we sold them for a regular price. The Nature Conservancy lost money on this sale but at least they got some money, the employees were thrilled and they didn’t have to pay to store them at a fulfillment house.
Obviously, the rise of the daily deal site like Groupon have fostered that game online in a unique way but honestly when will it stop? When will the products become so cheap that folks wise up and decide to pay a little more for better quality? When will folks stop buying items they don’t need or sometimes even want just because they were cheap? I think its terrible but also see a great opportunity to sell at a cheaper price and create that hysteria to sell products. I hate that i have to think this way.
Wow, i was wrong. I apologize to AlphaBroder and InkSoft. I think they delayed offering the designs in your account for a few days and I stupidly assumed they were going to leave it that way. The design studio is awesome for print and can only rival CustomInk. Huge step in our industry. As soon as they start letting you create your own sites with this design center, no one in the industry will be trying to catch up with CustomInk technologically.
I think the only question is when AlphaBroder is going to buy InkSoft? Otherwise, I’m not sure InkSoft’s motivation offering its studio for free. It’ll be the tail wagging the dog soon at Broder as long as LittleJohn realizes what they have and gets the check written. The only thing this offering may disrupt is the design heavy printers. Now anyone can create great looking art and have it immediately available for printing. I wonder what SanMar has up its sleeve now?
First off: Happy Easter, Patriots day, marathon day and now Boston Strong Day! I have to say how glad i am no one got to trademark Boston Strong and that this was true charity. Too many folks trying to cash in on every event and online fundraising t-shirt programs now.
So, i needed to pick up an iPad cover and headed for Staples this morning in Acton (3 miles from our shop). I was surprised there was not a larger selection and how EXPENSIVE iPad covers have gotten! Wow. $79+ for a cover. that’s a lot. Luckily i found the last cheap one in the store ($15) and headed for checkout. That’s when i noticed the schwag display in the copy center (do people still use the copy center?). I went over to take the picture below of the display while a patron wondered what i was doing. It was basically a display with flyers on an embroidered hat, shirt, a printed mug and mousepad all with an example logo stitched or screen printed. I thought of the old Awards.com deal with Staples when they put promo product kiosks in Staples. Unfortunately, it seems the management at Staples forgot about how poorly that performed and the huge lawsuit Awards.com filed after Staples cancelled the arrangement. Anyway, it was fun to see and hoped it would inspire customers to purchase promotional products at some point in the future.
The next stop really threw me for a loop. I went to the checkout counter and found Pop Tarts for sale! This isn’t your average impulse buy like a soda or candy bar! They were full boxes of Pop Tarts like you’d find at the grocery store. You’re not going to eat these in the car on your way back to work. I immediately looked over to see if they had converted the Tech desk to a salad bar! That may be next because its a great idea and the Tech guys at that desk are useless. I avoided buying a remote drive so i didn’t have to go to the Tech desk and ask for it. I’d be pitched a service plan for $50 when the drive was $69 and USB cables they’d convince me weren’t the ones i already had piled up in an office drawer.
The point is, Staples has completely lost its identity and marginalized their brand. I don’t fault them for trying to find other products they can fight Amazon.com and NewEgg.com with but they lose becoming experts in anything. I seriously think they should take the paper clip out of their logo and replace it with a similarly looking food item and completely switch to a grocery/convenience store that provides all of your “staples”. You need pads of paper, desk chairs and Pop Tarts. Why not embrace this and become an ‘everything’ store. Forget about being an office supply company and become a life supply company. With more and more folks working from home, this isn’t crazy or me being sarcastic. Walmart is selling groceries and so is target. Go head first into a change…..going slowly just marginalizes your brand
Big News in our weird industry. Broder launched an design online application on their AplhaBroder website that is powered by InkSoft. InkSoft admittedly has an amazing online design tool for screen printing specific for end customer use. Very much like CustonInk’s ‘lab’. Of course, they don’t have an embroidery solution but that seems less important every day. The problem I see as a decorator is the behemoths continue to provide only “pho-ware” or software that is great at looking nice but doesn’t solve any back-end ordering inefficiencies. This is inherently the problem choosing a software vendor versus an ‘operating’ decorator with software.
I do feel AlphaBroder consciously provides an incomplete solution to keep their strangle hold on a wildly inefficient market. They benefit from lowering barriers to entry and adding yet another middleman in THE most layered simple business in the country. Why wouldn’t they develop software to help their customers sell and run their shop? OK, they don’t know how?….well find someone that will help with it, right? Nope, let’s introduce a new layer and add a technology company in the middle. Why? Levels the playing field and reduces barrier to entry which means another 20,000 new folks selling screeprinted and embroidered apparel. More small customers fighting for pennies is a good business and a smart move. They play lip-service that they are helping customers offering design studios and they care about your business in particular. Problem is, they are helping everyone compete with you at the same time. They’ll never limit who they sell to so you’ll have to send multiple quotes for every order you take. You won’t “win a customer” any longer, you’ll start having to “win every order”. Might want to brush up that resume cause this form of business is unsustainable. Add in all the websites reselling blanks from AlphaBroder for 25 cent profit and it’ll be over soon!
However, its not all doom and gloom: I do think it creates a great opportunity to provide end-customers with a complete vertical in our industry that is currently dominated by only two major suppliers that do not decorate and have yet to provide a way to process small orders efficiently.
Where the f- are you? I love snow and winter weather but even I’ve had enough. Please try to join us before May!
We’re clearly ready for Spring in the Boston area and from what I gather everywhere else in the eastern US. March is also a roller coaster business-wise since most folks order uniforms with the changing of seasons and custom t-shirts certainly need warm weather but that ain’t happening…..so, in our effort to make light of it, we’re offering custom t-shirts with a 2 color logo under $5. We’re affectionately calling it the WTF Spring promotion. Get some great tees now before the warm weather hits and save: http://www.corporatecasuals.com/main/squote.aspx?Style=PC61
What a great validation of Marc and Sean’s (only people i know there) hard work yesterday in the Washington Post: http://wapo.st/1bwZQnO They certainly deserve it and i wish them the best. They are somewhat of a competitor but have always been fair with me (except my brief interlude with Andy Louis charles). They were online early advertising and clearly serving the larger side of the business with screenprinted t-shirts. I never thought a customer would design their logo online and CustomInk changed my view of that. They were the first (and i copied) to put up online reviews which not only help prove and improve their service but it gave their site ‘liveness” which at the time was non-existent. They leveraged great service and outsourced the printing for as long as they could to meet demand without the cash demands and ramping up staff for a highly cyclical business. But outsourcing is very difficult to manage and I would never want to do it. We diverged into B2B while they went for consumers. I thought managed online stores for companies was a sure way to get all internal company purchases (it wasn’t), while they developed design-online. I concentrated on embroidery thinking it was an equal portion of the market then it clearly is, while they focused on screenprinted tees. As stated in the article, they got funding and started from scratch. We got a lot less funding but had a legacy business problem that diverted our attention but also kept us afloat with diversity. They invested heavily in customer service and artists, we thought complete online transactions were the best especially for on-demand stores like the Nature Conservancy, World Wildlife Fund and Audubon.
Regardless of the similarities, differences and paths we’ve taken, CustomInk picked the right strategy, hired the best people and executed it to perfection. They are the envy of our industry and honestly have helped improve service for everyone. There were (and still are) a lot of shady “used car” type dealers that would steal and undercut from others. That manifested itself in a bad experience for the end customer. The exceptional service CustomInk provides has forced everyone else to do the same. That improves the entire industry.
I am and have always been very competitive in sports, work, scrabble, etc. which should mean i hate to lose more than anything. That’s not true. Once you are competitive long enough and in some small way successful, I feel you gain a new perspective. You want to win of course and you should be irate if you didn’t perform well but never spiteful of your competitor especially when they played on the same level playing field you did. I have the utmost respect for the folks at CustomInk and think they have done an amazing job. Keep it up!
I took over my mother’s one part-time employee business in 1994 and jumped into the contract embroidery business head first. I borrowed money from my parents to buy a $100K industrial barudan embroidery machine and started making calls. The business grew quickly and we expanded. I thought i was a genius or a dynamo sales-guy at least; i wasn’t. I just took a chance and it worked out at that time in that industry. What i didn’t realize was machine companies would come out with cheap machines in the years to come and eliminate the barrier to entry i thought was me being smart. Like most businesses, barriers drop and that’s a fact of life. We became more efficient to stave it off and started selling online direct to acquire our own customers but i grew up as a contract embroiderer and wanted to continue in that business.
Unfortunately, cheap machinery was not our only problem. Manufacturers of brands like Charles River, Antigua, Ash city, etc started offering embroidery in-house and overseas turn-arounds reduced to 90 days so all big orders were done before they were shipped from china. Lastly, the final two large blank (no embroidery or screenprint) distributors have not stepped up in any meaningful way to protect the decorators that add value to their product. Without a logo embroidered or screenprinted on that garment, its worth virtually nothing. Add in all these factors and it seems clear to me that contract embroidery as we knew it is getting squeezed out of the market. There’s no path to creating a sustainable venture. You have to win every order over pennies while the distributor salespeople and SanMar/Broder eat up most of the profit. This is not complaining; if i were in their shoes, i would do the same thing. Problem is: when we’re gone they’ll lose a lot of business and besides having an exclusive brand agreement with Nike or Adidas, they won’t be any different then the small players. If they try to decorate in-house, the majority of their customer base (small decorators) will go to another vendor. The true sales guys will likely order from a one-invoice supplier or begin to decorate in-house and kill the small decorators that are town-based an rely on walk in traffic versus going out and selling.
So, in conclusion I am sad to see the dead end road for contract embroidery without support from the large blank distributors but want to point out that letting contract decorators die will be detrimental to their business long term. They are the geniuses today i was in 1994 and will soon be the non-genius i am today unless something changes quick.
About 25 years ago I traveled up to the North Country to become a ski racer (after i came to the sad realization i didn’t have the size (or hands) to compete in football at a high level). I enjoyed 2 years at Northwood School in Lake Placid but was riddled by injuries. I had knee surgery in October of my first year and didn’t make it ‘on snow’ until late January and wasn’t able to compete well that year. Senior year I was fortunate to start getting some real results until i shattered my shoulder the day before Junior Olympics where i was supposed to represent NY State. Too bad and I sometimes wish i had pursued ski racing for another year before going to college but that’s the way it happened.
However, a month or so later i got accepted to St. Lawrence University and my whole world changed. I was able to race D1 for two years, although not very well (i needed more training to keep up and wasn’t getting it at SLU). But, truth be told, I was more than a little distracted by college life. I picked that up real quick and had the time of my life. Beyond the short term fun and stories we continue to tell about our time in Canton, NY, I cherish the friendships i made at the “Larry”. I married a SLU girl, still live within 3 miles of 3 good SLU friends and regularly get together with the same exact friends I did back at St. Lawrence University between 1989-1993.
So, even though i haven’t been to campus in 20 years, i was saddened by a devastating fire at Gunnison Chapel this weekend. I’ve pasted the story below along with pictures and a video. Gunnison Chapel has been a symbol of SLU for almost 90 years and like any object that recaptures great memories, it was sad to see it destroyed