So, your customer returned again this year asking you to reprint their usual spirit-wear design for the upcoming football game. That’s great. But why stop there? Think of all the potential that exists for increasing your sales by taking that one design and using it to create an entire collection.FULL STORY
Digital Decorating: Process + Techniques
How to Maximize Product Margins
When creating sample kits, you may have to create a fictitious business or school name to avoid showing favoritism, which could hurt the sales process.
Sales are the backbone of a successful apparel decoration business, and a well-orchestrated sample kit is the key to turning sales opportunities into real profits. Regardless of whether you are selling embroidery, screen printing, digital printing, transfers or bling, you must invest in samples that get the attention of your clients, steer them to items that are profitable for you and inspire them to do business with your company.
Customers routinely focus on price, looking for the lowest-cost products offered. In most cases, that means smaller markups for you and lower quality for them. Upselling is a concept that is used to move the customer into a “better” range of products that have higher margins for you, thereby increasing your true revenue for any given job.
The easiest way to do this is by incorporating a “good-better-best” methodology that allows customers to do a hands-on comparative analysis of items within a given product category.
For example, instead of showing a single 50/50 T-shirt, invest in light, medium and heavyweight versions. Lay them in front of customers and ask them to decide which is best for their needs. In nearly every case, they will prefer the heavyweight version after handling the products. In reality, they probably will end up buying the medium-weight version as a compromise between price and quality.
The same process can be applied to other product lines as well. For sublimators, something as basic as a coaster comes in multiple quality levels. A simple, hard plastic version will suffice for the “good” scenario. A cork-backed one works well for the “better” version and a sandstone coaster is ideal for the “best” product.
There is a lot more to maximizing margins than just upselling products. Pricing is a tough game to play, with most decorators looking for some kind of mathematical formula to guide them. In reality, customer perception is truly what sets the selling price of a product, as it’s only worth what someone will pay for it.
Focus on driving up the perceived value of your products by using creative samples. This usually can be done with something as simple as graphics, and even though the perception of value increases, production cost does not (see Figure 1).
The same concept can be applied to virtually any type of decoration on nearly any type of product. Just use your imagination and come up with some great ideas. Use this strategy to assemble samples that can be used to support your sales presentations.
Just as a good sample kit can help you, a bad one can work against you. Like it or not, people do judge a book by its cover and they will certainly make assumptions based on your samples. Avoid tossing random samples into a bag and dragging it from client to client. Your kit needs to be carefully thought out and strategically created (see Figure 2).
Don’t try to impress a client by showing a sample of everything you can do. Instead, carefully choose items that should be of interest to that customer. Think of what makes sense for your pitch and create a presentation around it. Each sample product should play a role in that presentation. If it doesn’t, leave it at home — or at least in the car.
One sample kit won’t work for every situation. Thus, you ultimately will end up with multiple kits that target different markets and needs. What you show to the corporate market will differ from what you show to the sports market. And even within a given market, you may have specialized products for different sub-markets.
For example, in the sports market there are many different categories: golf, soccer, baseball, basketball, hockey, volleyball, swimming, etc. So it’s important to focus on what defines a given market so that you can develop unique samples that fulfill its needs. With your clients, always ask what they need and why. That will help you define not only the products, but also the graphics and margins. After all, the more they need it, the more they are willing to pay for it.
Let’s look at a small business. Why do they need decorated products?
1. Advertising to bring in business
2. Promotional products to establish their brand
3. Apparel for employee uniforms
4. Recognition products to reward their best employees
5. Holiday gift items to thank their top customers.
Chances are good that the business thought about Nos. 1 and 2 on the list, but maybe not Nos. 3-5, so this gives you a chance to tell a story that grows beyond its basic needs. And keep in mind that, if done correctly, Nos. 3-5 also will fulfill the top needs — advertising and promotions — which usually are the most significant needs for any small business or corporation.
Figure 3 shows a promotional product that has several key elements that make it come to life. For all practical purposes, it will tell a story that ultimately leads the end user down a certain path. Its key elements include:
1. It is a usable product, which means it has longevity and visibility in the user’s hands.
2. The Sally Anne’s logo has a prominent location, which emphasizes the brand.
3. There is a picture of the company’s top-selling product, a cheeseburger, which clearly defines Sally Anne’s primary business.
4. That same picture should trigger the user to feel hungry when stared at for long periods of time.
5. Once the user feels hungry, he can see the printed list of top-selling food items.
6. He can then order online or by phone, both of which are printed on the menu.
This product ultimately fulfills two needs. Sally Anne’s gets more sales and the end user gets fed.
What if this promotional product had only included Sally Anne’s logo (common) and nothing else? The impact would have been far different, as the logo really says nothing about what Sally Anne’s is and what the business can do for you.
Your samples need to tell stories to your clients about how you can help them fulfill their needs. Sometimes this is done via individual items, but the story is more likely told by packaging multiple items — a process called cross-selling.
Many times, clients will ask about a single product — a T-shirt, sweat shirt, coffee mug, water bottle, hat, tote bag, etc. But you should respond with at least five products that complement that original item. This can stimulate customers to expand their orders, which increases your profits. The key here is not to be random, but have a group of products with a common theme so that they logically work together as a set.
For example, a boutique hotel is interested in polo shirts for its housekeeping staff. Are there other opportunities? The front-desk staff wears more formal clothing, so that eliminates them — or does it? Neckties can be imprinted with the hotel logo, as can scarves and sweaters. And then there are all the other items — towels, linens, pillowcases and more — that also can be decorated with that same logo. If you have the capabilities to print on non-apparel products using processes like sublimation, it further opens the doors.
In Figure 4, there are at least nine different products that would be a perfect fit for any hotel room. Multiply that by the number of rooms and you can see a nice increase in the potential order size for this client.
1. Serving tray
3. Coffee mug
4. Toothbrush holder
5. Soft soap dispenser
6. Hand towel
7. Door plate with room number
8. “Do Not Disturb” sign for door
9. Key chain
The rest of the items — signage, dinnerware, clocks and more — can be spread throughout the hotel’s common areas.
Not only does this sample collection focus on cross-selling, but it also targets a specific market with specialized needs, which is referred to as a vertical market. Thus, cross-selling is a tool for developing collections of products that are focused on these kinds of opportunities.
You don’t need to create a kit for each business you’re targeting, as it would be too time-consuming and quite expensive. Instead, put together packages that are generic enough to show to different clients within the given vertical, but specific enough to fulfill that market’s unique needs.
In many cases, this will mean creating a kit that is centered on a fictitious business or organization. This ensures you don’t step on any toes by showing products created for competing businesses. In the case of sports or schools, you don’t want to show any favoritism, which could hurt the sales process.
Ultimately, if you assemble creative samples that fulfill a need while creating excitement, you will raise the perceived value of your products. Marketing will be the driving force for maximizing your margins, so it’s critical that you develop a strategy that steers customers away from the good products, and into the better and best ones. That’s where you will create a happy customer and a happy bank account.
Award-winning author and international speaker Jimmy Lamb has more than 20 years of apparel decoration experience. He currently is manager of communications for Sawgrass Technologies, Charleston, S.C. For more information or to comment on this article, email Jimmy at email@example.com.
Hear Jimmy speak on digital decorating topics at the 2015 Imprinted Sportswear Shows (ISS). Individual seminars are just $25 if you pre-register: issshows.com.
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