Off the Cuff: The Pitfalls of Political Payoffs

Getting paid from political organizations and campaign organizations is a minefield for the uninitiated. Here's how to avoid getting stiffed.
Sept 24, 2007

By Mark L. Venit, MBA

Local election campaigns in November and the presidential primaries (starting in January) are moving into high gear. Next year is, however, the Mother of All Elections. Two major-party presidential campaigns, U.S. Senate campaigns in 33 states, a dozen or so governorships and 435 races for seats in the U.S. House of Representatives will bring a thousand more candidates in need of what we sell.

Add to these campaigns tens of thousands more office seekers around the nation vying for municipal, county and state legislative, executive and judicial positions. How many altogether? According to a recent report by Mike Wallace on Fox News, there are more than 500,000 elected officials in the United States.

For our industry that means tens of thousands of orders — and re-orders — for T-shirts, sweats, caps, bags and promotional products. Indeed, there’s gold in them thar campaigns!   

But as with mining any natural resource, there are risks associated with the opportunities and lots of firms in our industry will get burned.


Know the Ropes
Campaign committees are temporal vessels that begin for a reason and end for a reason. They begin obviously with the desire to get someone elected and end shortly after the votes are counted, win or lose. Regardless of your political preferences, sellers who fail to adequately protect themselves from the risks
of dealing with political campaign committees do so at their own peril.

Our ranks are regrettably littered with companies that hitched up to politicians’ bandwagons, only to be abandoned by them when the bill came due, often big-time. Of course, some of us will make respectable buckos on the upcoming elections. But the winners and losers in our industry will be determined not by votes but by the skills and savvy of entrepreneurs who know — or learn — that their biggest campaign challenge is getting paid.

Industry veterans know the ropes, most of us having learned the hard way. But less seasoned producers, especially those who have only recently entered our ranks, need to learn a few important lessons. Fast. Let’s start with the opportunities.

What to Sell
Political campaigns focus on three key applications when purchasing decorated apparel:

•    Spirit Wear — an investment in esprit de corps, boosting the morale of those who wear campaign gear and their co-workers who see them in it.

•    Advertising — Hardcore supporters not only derive great pleasure in identifying with the candidate but also want to advertise that affinity! According to the Apparel Graphics Institute's research, a printed T-shirt or sweatshirt worn outside the home or office — in class, going to and from work, at the mall or supermarket — will be seen by approximately 200 people in a day.

•    Fundraising — Selling campaign apparel and promotional materials to supporters not directly involved in a campaign itself allows people to make a campaign contribution that amounts to as much as $5 to $10 per-unit profit per T-shirt for the organization and $10 or more on higher-priced items.

Whatever the mission of campaign shirts, caps and bags, getting paid from political organizations and campaign organizations is a minefield for the uninitiated.

How to Collect
While selling to a political party is relatively safe, provided you’ve crossed all your T’s and dotted your i’s, selling to campaign committees is another story, as these organizations are strictly short-term affairs.

Unless you prefer learning the hard way here, selling to campaign organizations means you get paid upfront. In many states, that’s standard practice. Period. Moreover, campaign organizations just about everywhere expect to pay upfront. So, don’t be a Mr. Nice Guy and allow C.O.D. orders.

You know the drill when the garments are picked up, don’t you? “Listen, I forgot a check.” “Oh, you need payment on delivery?” “Well, you know we’re good for the money!”

Candidates’ committees that owe money after election night, especially those who lose, quickly forget their campaign promises — and oftentimes their debts.

Just ask Bell Telephone, which in 1975 settled Hubert Humphrey’s 1968 $2 million long-distance bills for ten cents on the dollar.

Mark L. Venit, MBA, is president of Apparel Graphics Institute Ltd., Ocean Pines, Md., which provides management and marketing consulting and proprietary research to apparel graphics companies throughout the Americas and Europe. He is also the chairman of ShopWorks Software LLC, a provider of industry-specific business software. Venit teaches pricing, strategic marketing, salesmanship and other business management topics at the Imprinted Sportswear Shows. You can reach him at markvenit@cs.com.
 
Editor's note: In addition to his experience as a decorated apparel industry consultant, Mark Venit has served as an elected official, campaign fundraiser and marketing consultant to several Republican House and Senate candidates.