Off the Cuff: Revenue Strategies That Are Working!

No matter how decorators say they have boosted revenue, it all boils down to one basic business initiative — marketing.
Dec 17, 2007

By Mark L. Venit, MBA

It's Milestone Time again — the third annual Impressions Decorated Apparel Universe Study, the industry's most diligent effort at measuring industry trends, participants' aspirations, the dynamics of change, and their causes and effects, along with a host of other interesting information. Though I have some professional reservations regarding the survey's findings —there are, in my opinion, a few areas that ought not be taken quite as Gospel —I can say with confidence that this year's report does contain a great deal of food for thought. (For the record, Impressions' editors solicited my input and counsel regarding revisions in segregating audience categories, company metrics and marketing issues, recommendations which were by and large incorporated into the research.)

But what jumped out at me this year, among other telling stats, is a look at the most successful strategies apparel decorators and promotional products distributors are following to boost revenue. The question asked was: "Which top THREE strategies had the most positive impact on your company's revenue growth in 2006?"

Among the 15 response categories offered to survey respondents, ranking as the fifth most meaningful strategy was . . . drum roll, please . . . "Trying new advertising and marketing methods," cited by a fifth or more of all respondents. Ahead of that, in fourth place, was "Entering new markets," identified by one-fifth to a third of respondents in all categories. Moving up, the No. 3 answer was "Adding new products," cited by a quarter to two-fifths of all screen printers, embroiderers and promotional products distributors. (PPDs, of course, avail themselves of the fact that the promotional products industry itself has literally thousands of new product introductions every year, and it's hard not to offer new stuff!)

No. 2 was "Increasing business with current customers," a fact noted by about 50% of all survey respondents. And the No. 1 strategy that produced revenue growth: ta da! —"Finding new customers," reflecting the endeavors of a not-surprising 60% to 70% of respondents in all categories.

Though keeping existing customers is both easier and less costly than looking for new ones, the lesson here remains that what boosts sales from old customers and new is a proactive effort to bring in new business coupled with improved marketing and advertising to seed the targeted audiences, whatever the medium employed may be.

Meanwhile, there are those in the industry forever doomed to practice what I call the "faith-based marketing" model, whereby devotees sit by the phone and pray for it to ring.

And what was given least credit for positive impact on the bottom line, according to survey respondents? Three response choices tell the story here: "Developing an information-only Web site"(all respondent categories were in the basement) and "Lowering prices," which ranked next-to-last in helping boost revenues. Duh. (So much for the folks who adhere to the belief that "By giving it away, I'll make it up in volume!") Not far behind in not producing growth was "Developing an e-commerce Web site," which fell into the bottom 20% to 25% of all responses.

Industry veterans learned long ago that deep discounting and playing other pricing games aren't worth the effort. But the industry is still clogged with participants fanning the conventional wisdom of spending big bucks to launch expensive e-commerce sites in search of the easy way to get orders and not have to work hard at it — and seeing little or no return on investment. Sure, there are a few success stories of decorators who have indeed succeeded with e-commerce strategies, but for each one of them, there are many, many more who have failed.
 
If there's real wisdom to be mined from this year's survey, it comes down to the basics, not to get-rich-quick schemes that sidestep doing our homework, proactive effort, intelligent planning and using our noggins.

The basics? Simply put, they are as follows:
1) Marketing and advertising to both existing customers and new prospects and in new markets, where identified and accessible.
2) Learning about new products on the scene (in the apparel graphics sector, they're generally nuanced and small-but-measurable shifts in existing lines). And then telling people about 'em! Along with reminding them about the core products — such as the basic tees, sweats and golf shirts — that form the foundation of your enterprise.

For 30 years, I've been preaching the same sermon — even if often to the choir: "Those who market, win. Those who don't, lose." It's as true today as it was when I first said it.

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.

Off the Cuff: Confidentiality Agreements
Confidentiality agreements protect more than your assets. Just as importantly, they protect your customers.
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September 15, 2008

Off the Cuff: How to Charge for Rush Service
Charging for rush service is justifiable, but be sure to outline  policies upfront and inform your customers.
The issues of whether and what to charge for rush service are common in the decorated apparel industry and there are valid arguments on all sides. Most companies feel they’re entitled to some degree of additional compensation for going our of their way to accommodate a rush order, for bumping other customers a notch or two back in the production line and for having to deal with the potential hazards of doing something faster than necessary. Oh, and the more sanguine reason: you can, if you choose, stick it to ’em when they’re on the ropes.
August 29, 2008

How to Profit from the Tax Write-Off for Conventions and Trade Shows
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Tax Breaks for Education — What Every Decorated Apparel Business Owner Needs to Know
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Finding, hiring, training and retaining “smart” workers have long been key factors in the success of small businesses, including decorated apparel companies. Lawmakers have also recognized the importance of a smarter workforce and created a number of educational and training-related tax breaks and incentives. Those tax benefits allow every commercial embroidery, screen printing and promotional products business, large or small, to offer training and education as a “fringe benefit.”
August 04, 2008

Economic Stimulus Package Offers Tax Break for Equipment Buying
Decorators interested in expanding their business or replacing old equipment can rejoice in the new round of government incentives designed to help small business owners.
Earlier this year, Congress passed, and the President signed, the Economic Stimulus Package of 2008, a $168 billion economic “rescue” package that included rebates for taxpayers and tax breaks for businesses. In addition to those tax rebates, the heart of the package, there also were tax breaks for businesses such as decorated apparel operations — breaks retroactive to the beginning of 2008!
July 21, 2008