Episode 186 – Getting Ahead of 2023

Custom Apparel Startups

Episode 186 – Getting Ahead of 2023

This Episode



Mark Stephenson & Marc Vila



customapparelstartups.com



CAS Podcast



ColDesi

You Will Learn

• Which issues experts are warning about in 2023
• Various techniques to overcome challenges in 2023​

Resources & Links

• Colman and Company Blog
• ColDesi Learning Center
• Leasing Equipment
• ClientsFIRST Marketing

Episode 186 – Getting Ahead of 2023

2023 Is Here : What’s In Store For Your Business

Mark and I have been reading around to learn what problems the “experts” say small business owners will run into. We then put our heads together to consider how these affect the customization business industry.

So here we go… let’s get ahead of 2023 with expected challenges and resolutions!

Supply Chain Issues

There will still be issues with getting supplies, and it shouldn’t be a surprise anymore. Since 2020 everything from toilet paper to cars has seen the effect of backorders & supply chain issues.

What this means for you

• Stock up, Stock up, Stock up
• Have backup plans, especially for apparel
• Don’t procrastinate
• Include in communication to customers

Accelerated Digital Transformations

Changes are happening faster than ever. Your customers are going to want to interact with you digitally the way THEY want to. Texts, live chats, emails, social media, package tracking, etc.

What this means for you

• Find the ways your customers like to interact
• Figure out how to implement (CRM, Texting Software, Apps)
• Move away from the old ways (Excel quotes, Taking credit card numbers over phone, physically signed quotes)

Inflation

Prices are still expected to go up.

What this means for you

• Prepare your customers ahead of time
• Be watchful of waste / Find ways to be more efficient
• Raise YOUR prices when you have to
• Find ways YOU can help YOUR customers save money. e.g. “what other promo items do you use, maybe I can help you consolidate all of them with me to save money”

Talent and Staffing

Good quality employees are going to have plenty of opportunities.

What this means for you

• It may be hard to hire if you need to add staff
• Create a Good Working Environment that encourages employees to join/stay
• Know employees’ worth, if you hear similar jobs pay $2-3 more an hour, consider raises

Increased Customer Expectations

People get things faster and more personalized than ever.

What this means for you

• You ARE in the customization business, so that’s good for you
• You will want to be efficient to deliver things faster than ever
• Consider what you keep in stock so you can deliver same/next day

Transformation Of Gig Workers

More people are moving to gig/contract work as a side hustle or even full time.

What this means for you

• Potential to outsource to help your growth
• You might not have to hire in a full timer
• Hire people seasonally, even IN your shop
• Gig workers can be a market too

Even though challenges are expected in 2023 there is still a ton of optimism in our industry, so be sure to keep pushing forward and make it a great one!

Are you a company of one? Get help with Gig Workers.

Transcript

Mark Stephenson:
Hello everyone and welcome to the first episode of 2023. My name is Mark Stephenson.

Marc Vila:
And this is Marc Vila. We’re here with custom apparel startups to talk about getting ahead of 2023, challenges and opportunities.

Mark Stephenson:
Right, because there will be both. I don’t have to have a crystal ball, which I do by the way.

Marc Vila:
You do?

Mark Stephenson:
I don’t have to have one though in order to tell there will be both challenges and opportunities in 2023.

Marc Vila:
Yeah, absolutely. This is the first episode, as you said, of the year. It’s been probably maybe 60 days or less, maybe 45 days since we did an episode. It’s been a little while, but this year, we plan on doing more episodes. We plan on having some more guests come in. We’ll have some different people from over here at ColDesi and maybe some other experts around the industry to help you and your business out. Definitely stay tuned for more stuff. But today, we’re going to talk about getting ahead in 2023.

What we mean by that is Mark and I went all over the internet, we’ve noticed some things on our own, and we did our own research, and we just started looking around at what do the experts say that small businesses will run into this year? What challenges will they have? Then we took the challenges that we felt were the most interesting for our industry and we put together solutions that should be effective. We also noticed it started with challenges and solutions, but then as we did this, Mark Stephenson noticed a bunch of opportunities. We had to add because that not only are there challenges and solutions, but there’s opportunities for you to be more successful.

Mark Stephenson:
I mean, everybody knows that I have the most positive outlook on everything.

Marc Vila:
I think that’s under your LinkedIn profile.

Mark Stephenson:
It is.

Marc Vila:
Mark Stephenson, most positive.

Mark Stephenson:
Not curmudgeonly at all. Okay. I think, Marc, you’ve got the first issue that we’ll probably continue to face in 2023, which is supply chain issues. I know that we’re seeing that in the custom apparel industry in a variety of different ways, but I’m seeing it in my outside clients as well. I’m seeing it across the board with people in any kind of industry where you have to deliver goods. We’re seeing some kind of supply chain hiccups that will probably continue to affect us.

Marc Vila:
Yeah. I mean it started in 2020. I don’t think anybody thinks it’s going to be over in 2023. I mean, everything from toilet papers to cars and everything in between. We’ve seen it all across our industry and in plenty of others. Here’s a few things you can do about this. For one, I wrote it three times. Stock up, stock up, stock up. Especially on simple things. You should not be… This has always been true, but more true than ever.

You should not be on your last foot of vinyl before you’re placing an order for your next role, especially if it’s something you use a lot. You should not be out of white ink before you order something. You should not have five sheets of paper before you order something. If you do, then all you are… it’s a ticking time bomb waiting for that one thing you need to be back ordered and it may only be back ordered for a week, but that week of time could kill the order you were trying to fulfill.

Mark Stephenson:
This is not a new phenomenon. I mean, I think we’ve done 1,100 podcasts that mention, “Keep good inventory control, make sure you have the stuff that you need in stock because,” if you need to order a roll of backing, or a liter of pretreat, or anything else that has any bulk at all, you need to order it overnight. One thing that we know in 2023 is shipping costs are not going to go down. You’re going to stack up the pain by having to order something on back order and then getting it overnighted or expedited when it comes in. You’re going to wait, you’re going to pay more, and you’re going to wait, and then you’re going to pay more.

Marc Vila:
Yeah. You’re going to be stressed out, you’re going to miss out on orders all because you didn’t do one of two things. You have to manage the money in your business well enough to be able to keep inventory of important things, and or you didn’t actually check your inventory to see what you actually had in stock or organize it in a way. This is just going to continue to be important. The folks who do…

Even if you do a great job of it, you’re still going to run into supply chain issues, but you’re going to have a lot easier time than the folks who are just flying through the wind, ordering things late and consistently because they’re going to be in more trouble than you, because you’ve stocked up. Be sure when you’re stocking up to just consider shelf life of things. If something says that it’s good for two months, you probably shouldn’t order more than two month’s worth. If something is good for a year, then you probably shouldn’t have more than a year’s inventory of anything, but you should consider that as well, right?

Mark Stephenson:
Yeah, I think that’s a great idea, to make sure to check expiration dates, but I also want to apply this idea to the apparel that you sell every day. I don’t know how many times… I think probably at least several times a week in the CAS Facebook group, you see calls out for a particular Richardson hat that’s on back order, or for a shirt, or a jacket, or something along those lines. If you get regular orders for an item, there’s no shelf life on a hat.

If you’ve got a good business, a solid business, you’ve got a track record, you know that you’re going to sell 50 hats a month, or there’s potential that you’ll get an order for as many as 200, you can invest in that inventory, take the last minute shipping and the potential for supply chain issues out if you just pick those common items, keep the cans of soup in the pantry. Regardless of what the food cost is, you can buy as much soup as you want to, as much canned goods as you want to right now, and it’ll last, so you don’t have to deal with supply chain issues if you keep the regular things on hand.

Marc Vila:
Especially when it’s not a size, color thing. If a gray cap, it’s one size fits all, you can order more of those. By the way, just like retail stores do, and we’ve talked about this in the podcast, if you sell, let’s say a can cooler as an accessory you often add on a little plaque or an award or something like that, that’s usually a generic color that can work out for folks, just like retail stores do, that’s what you sell. If you order a bunch of black and white on the caps or gray and white or whatever it is, then that’s what you pitch.

Just say, “Hey, you know what? Your logo will look great on gray, I’ve got them in stock, I could start making them today.” Stock up what you can, especially one size fits most for apparel or things that aren’t necessarily size and color. Then even with size and color, if you do a lot of polos, you can carry… you know the sizes that you sell often, you can do black and white, and again, you can sell the black and white. If somebody normally gets a blue shirt and you decide to invest in some black and white, sell the black and white this time, they might love it.

Mark Stephenson:
I think that that also goes to what your next point is, which is to have a backup plan. I mean, if you’ve got a regular set of, you normally sell these two polos, you normally sell one of these four T-shirts, you’ve got these three or four cap designs, then if you think there’s a hint that there might be supply chain issues, select and sample something similar so you’ve got a backup plan that you’re comfortable with.

So you’ve got something that you can fill in. I mean there are tons of t-shirts on Colman and Company’s website and while you may really love the perfect try for DTF shirts, the DT104 is great. If you go in and you look and say, “Look, listen, I just sell these perfect try Ts because they look great for many things,” but those are going to be slow coming, you can easily switch to another T-shirt model number and still not interrupt your business if it’s on the shelf.

Marc Vila:
That’s great. That’s great. We have two more points in this category. One we’ve already hit, but it’s pretty simple, don’t procrastinate. If you know you have to order things and you have a certain amount of time to order them, do it sooner than later. That will put you in line, if there is a back order, it’ll also give you opportunity to find an alternative if you need to. If procrastinate, and you know you have to order it by Friday, and you wait until Friday at 3:00, and it’s back ordered, then now you’re working all weekend trying to figure out how you’re going to get this versus taking the time to enjoy your kids’ baseball game or something like that.

Mark Stephenson:
That is correct.

Marc Vila:
Then the last one is, Mark, you mentioned this one, which I think is one of the best ones, is just communicating this to your customers, especially your regular ones. Hey, by the way… I’m just saying, every month I deliver these hats, the world from cars to toilet paper is back ordered, or we’ve run out of supply chain issues, or something like that. I’m not having an issue with this hat, but I’m just pre warning you that I’m hearing about things in my industry as well. If you want, I have a couple alternatives I’ll bring by your office one day, and I’ll say hi, just to show you. Then this way, you’ve seen it at least once before. You could actually be an opportunity to revisit with customers. It’s an opportunity to contact them and just give a reason to be in front of their face again, whether it’s an email, or a phone call, or in person.

Mark Stephenson:
Yeah. I think that goes with your standard communications as well. If you are producing a quote by email or by paper, you may mention that in… you can put right in there, “In the case of supply chain shortages, we will propose an alternative solution.” Or if you’re talking to somebody about a price and the job is 60 or 90 days out, keep in mind and let them know that if there’s any kind of a supply chain issue, because everyone knows how things are now, we may have to make a substitution, but we will let you know if that takes place.

Marc Vila:
Yeah. That’s great. Also, it’s an opportunity to get somebody to commit now.

Mark Stephenson:
Absolutely.

Marc Vila:
This is in stock now. I recommend you order it because in our industry, we’ve noticed all types of things disappearing. If you are in love with this shirt, I’m just going to say let’s get them in now, because it’s better to have them early and in stock and ready to go than to think about it for another week, and they’re not around, and now you missed out on what you really loved.

Mark Stephenson:
Yeah, just remind them there’s no shelf life on apparel.

Marc Vila:
No shelf life on apparel. What about the 1,000 years, Mark? 10,000 years?

Mark Stephenson:
1,000 years? There will be no shelf. So it doesn’t fly. You had put down here accelerated digital transformation, which fails my syllable test. You’re going to have to explain what that means.

Marc Vila:
Me too, actually. But when I kept going online and looking around, I heard somebody speak about this on a YouTube video or something like that. I think it’s a word people are using to sound smart in 2023 or a group of words, I should say. But accelerated digital transformation essentially means, well, accelerated would be to move to increase speed, and digital is the internet and stuff, and transformations are changes. It is increasing the speed in the changes that happen on the internet and such.

Mark Stephenson:
Okay, gotcha.

Marc Vila:
Which means that in this, you figure the amount that digital things changed between the year 2000 and the year 2010 is significantly slower than the changes between 2010 and 2020. This speed of digital transformation is continuing to accelerate. What’s going to happen is from the beginning of 2023 to the end, you’re going to see more AI software being used more often. You’re going to see CRMs being used more often. You’re going to see customers wanting and desiring to interact with you in different ways that other companies do.

For example, something that blew up over the past year or so is getting a text message for your tracking number. At first it was weird. I was like, “I don’t know if I like this.” Now I get a text every day on stuff that’s being shipped and it’s common for me and I’ve accepted that it’s good and now I kind of like it. That’s going to happen between you and your customers. You’re going to want to communicate with them the way you can and adopt technology that makes sense, that brings you into the modern digital age.

Mark Stephenson:
I agree. You can think of this, it’s almost going to continually be like the transition from regular TV to cable TV, from cable TV to video content services. There’s so many different ways that people interact with each other and absorb content that you’re going to have to adapt probably more than you want to. Two years ago, Facebook, for the business generation, two years ago, three years ago, Facebook was a fantastic place to get new business and it still is. It’s still a great quality place, but it’s more expensive and there’s less business there.

Three years ago, no one used TikTok for business at all. It was all just a good time, mindless video scrolling, and now it’s a common tool. For communications, it’s WhatsApp. For payment, even taking things like Venmo is a little old fashioned now, let alone PayPal. You’ve really got to maybe not make concrete changes and sign up for all these services, but you’ve certainly got to constantly stay in touch with your customers and figure out which ones they’re using so you can be wherever they are.

Marc Vila:
Yeah. I would just ask them… There’s a couple things you can do. For one, if you have a website or even if you don’t have a website, look at ways that you can accept payments that make it more flexible for customers. If you’re using Stripe or one of those, if they have an option where the customer can easily click and easily pay, especially if they have an iPhone, if they can use Apple Pay, or they can use Amazon, or PayPal, of course, any of these services are going to make it easier for them.

Ask your customers how they like to pay, ask them how they would want to communicate with you, and if they would like to text or email or phone calls or whatever it is. If you are going to do text messaging, maybe you look at some software that you can use that’s text messaging for business, so it’s not just going to just you on your personal-

Mark Stephenson:
On your phone.

Marc Vila:
I think the plan is to consider things that you like that you can maybe implement, because that’s a place I like to start, like, “Gosh, I like to shop this way. It’s easy. Could I add that to my business?” Ask people what they like, see how you can implement that. We lost Mark Stephenson’s video, but he’ll be back, I’m sure. Here we go. That’s moving into the future and then looking backwards, move away from the old ways, because you’re going to have to eventually, and this is going to be the year to do it because we’re having an accelerated digital transformation. The longer you hold on to the old ways, the further behind you’re going to get.

If you’re quoting through Microsoft Excel, you might want to consider a quote software or something built into a CRM. If somebody has to call you and read you their credit card number, you probably want to look for a way for a customer to enter it themselves. If you’re making customers physically sign a quote and deliver it to you somehow, you might want to consider a digital way of signing. These are all options. ColDesi is doing some of this stuff too. We’re implementing a new quote software for quoting equipment. I’m not part of that project necessarily, but I keep hearing about it.

Mark Stephenson:
That’s great.

Marc Vila:
And they’re working on it. We continue to do things like that and you should to.

Mark Stephenson:
Great. All right, the next one on our list is inflation. Have you heard of inflation?

Marc Vila:
No.

Mark Stephenson:
I ordered an Indian food takeout last night and about had a heart attack how much a meal was for two people.

Marc Vila:
Yeah. $90.

Mark Stephenson:
Exactly. $90.35, that’s crazy.

Marc Vila:
Yeah, I mean if I had a nickel for every time I heard the word inflation in 2022-

Mark Stephenson:
It’d only be worth a penny.

Marc Vila:
It’d only be worth a penny. I was going to say, I would probably cause more inflation. I mean basically, prices are just going to go up on various things. Maybe not everything. Some prices are going to go down, some are going to go up. There’s always a political spin on what inflation is and when it is bad and stuff like that. But the point is that I would say that some of your apparel, or blanks, or equipment, or whatever it is that you typically use to service your customers, some of that stuff’s going to go up, and you’re going to have to deal with that. What are some things that they can do to customers… the listeners out there could do to deal with inflation?

Mark Stephenson:
First of all, it’s before you quote, check current prices and keep the delivery date in mind. In other words, you may have a sheet, if you’re still using Excel, of prices on all the common blanks and supplies that you got last year in order to do quotes properly. I’ve had some construction clients of mine really get caught out because they will price out supplies, use them in all their quotes for six months, and six months later, the supplies are 25 or 35 or 40% more. Definitely keep updated with your prices.

The thing that I can’t stress enough is you are not doing your customers a favor by not passing on the increases that you experience. In other words, if a shirt blank goes up by $2, you eating that $2 is not making your customer’s life any better. It’s only making yours worse. If someone is paying $22 for a shirt and it’s legitimately costing you a couple of bucks more, charge them a couple of bucks next time, let them know that my supply costs have gone up in this specific way.

You’re not an oil company that’s making up the differences. Don’t look at yourself that way. You’re looking at, oh look, my costs went up, everybody knows that costs are going up. I don’t need to lose money to make my customers happy. Just get that through your head, put that in your psyche that when your prices rise, your customer’s prices just have to rise.

Marc Vila:
It’s complicated, because at Colman and Company, we’ve had… on colmanandcompany.com for example, the cost of paper goods has gone up, but we’ve made the decision to not increase the price on certain papers that we sell. It’s because of many, many factors that come into it. The number of customers, people that are on auto ship, there’s all these different types of things. It’s like, sure, maybe a vinyl cost goes up and you do the math on this logo on this shirt and you’re like, “I mean I guess it went up a nickel.

Do I want to bother my customers, disturb anything for that?” You may make a decision, but Mark makes a good point. On a $22 shirt, $2 is 10% almost. That’s a pretty significant increase for you to absorb right now, if your cost went from 25 cents up or the shipping cost increased a little bit, and you’re like, “This is less than 1%.” Make smart decisions, right?

Mark Stephenson:
That’s a good point. That’s a good point.

Marc Vila:
Yeah. One of the ways to combat inflation is a simple one that we’ve talked about a lot. Just be watchful of waste. Find ways to be more efficient. If you can waste a little bit less, if your costs went up 10% and you can find a way to save 10% on your supplies, you have flattened it. There’s a million different ways to do this, but if you’re DTD printing, does your customer need the highest resolution print? Maybe they don’t. One does, one doesn’t. The one that doesn’t, you’re not giving them a lesser product if they don’t care or they don’t need it.

Mark Stephenson:
I can’t get this toothpaste example out of my head. I saw this comedian or something and they were talking about your difference in attitude when you’re brushing your teeth in the morning, and you have a brand new tube of toothpaste, and you’re kind of tired, you squirt it onto the toothbrush, and half of it just goes into the sink, no big deal. By the time you’ve rolled it up to the little amount and you’re pressing on it and things like that, if a drop goes down there, you’re scraping it off the sink bottom and putting it back up on your toothbrush. It’s the same thing.

When inflation hits, you’ve got to treat it like you’ve already rolled down the toothpaste as much as possible so you make use of everything that comes out. You spend extra time making sure if you’re gang printing onto a digital heat effects sheet that you are using every square inch or taking on the opportunity across jobs to make sure you’re optimizing your paper usage. For designs, for digital designs of any kind, if you can take a look at the design and legitimately make the decision to make it slightly smaller and not have it impact the customer’s satisfaction at all, a 5% change over all of your DTG designs might make a little bit of a difference in the bottom line.

Marc Vila:
That’s a good point.

Mark Stephenson:
You can call that benign shrink-flation.

Marc Vila:
Yeah. Well, I mean it’s kind of like when the orange juice manufacturer just changes it from being 30 ounces to 29.2.

Mark Stephenson:
Right. Sucks, sucks.

Marc Vila:
I mean these are just decisions. Again, just all smart decisions, you figure out what makes sense. We’ve talked about this before too. If you spend so much time trying to gang print the logos that they’re so tight that you have to spend five, 10 minutes cutting around them to save every last millimeter of paper, you are probably wasting a lot of time, which is going to hurt your business more than if you would’ve wasted a little bit more paper. Balance, smart, right?

Mark Stephenson:
Agreed. Yeah. You’ve got to be aware of what’s going on at all times.

Marc Vila:
The next point, you actually mentioned Mark already, but raise your prices when you have to. We already went into that and the last point on this one is just find ways that you can help your customers save money. What I mean by this is we always talk about upselling and cross-selling and things like that. When you’re talking to your customers, this is an opportunity to ask them questions. Say, “Hey, 2020 to three inflation, buzzwords, happy new year, I wanted to mention that to you because we do shirts together,” and actually offer other things, “Do you have other promo products that you order?

Anything else you print? Any signage? I mean, mention other things you do that you order from other places. Because what I’d like to do is to see, maybe we could put it all together, and I can help save you some money by doing it all together,” and maybe you can, maybe you can’t save them money, but maybe you can look at, normally we order a mug for every new customer. You say, “Okay, what’s that costing?” I pay about $10 a mug. Well, you can turn around and offer them a lower price opportunity that they might be happy to say, “Well how about this?

What if you did a pen, and a can cooler, and maybe even a third thing, a key chain?” And you could say, “Because I can do all three of those for $6 rather than the 10 you’re spending on the mug. Maybe they think that’s a great idea. Now, they have saved $4 per customer for a promo item that they’ve done. They’re saving money to help make up for their rising cost on other things. In turn, you’ve increased the amount of revenue you’ve brought in by selling them more stuff.

Mark Stephenson:
Great suggestion.

Marc Vila:
All right, we got a few more things to cover. The next one is… this is especially hard for small business owners that are growing, but the talent and staffing issues that are going to continue to be an issue for 2023.

Mark Stephenson:
Especially if you are in what I might consider a small shop where it’s you and maybe two employees, four employees, or something like that. Each one of them is very important. They represent a huge amount of effort if you’ve got a small department or a small company. When a good employee leaves, it hurts more now and will continue to do so in 2023 just because the workforce is not available for you to replace them easily.

Marc Vila:
The job market changed a lot over the past few years. The balance of power from companies has changed, shipping companies have grown, and other companies have shrunk. That means that whenever there’s big changes in the job market, typically, people become more aggressive on what they’re willing to pay, how they’re willing to treat people, all of that stuff. If you do have to add staff or grow, or you have current staff, you should really take a close look at what’s the work environment like? Is it a good place to work?

Are you paying them fairly? I mean, it’s wonderful if you got a great deal on that employee, right? I mean, good for you and your business, but if you think that the pay is low enough to a point that, “Gosh, this guy could go and literally find a job anywhere and make more money,” then you are one Friday night beer conversation from a friend saying, “Hey, I can get you a job at my place. I make $17 an hour.” That employee’s just like, “Done.” That’ll encourage your staff to want to stay.

Mark Stephenson:
Yeah. I also think that it’s worth letting go of your preconceptions on what having an employee means and what that’s like. I was having a conversation with a business owner and he was looking for salespeople. He wanted to bring salespeople in to handle the current volume and everything and he was just having trouble. He couldn’t find qualified people that he really liked that seemed like they wanted to work.

After we talked about that, really what it boiled down to is this person had the need of having people in the office where he could see them work, because he was paying them by the hour, and the workforce that he was finding wanted nothing but flexibility. They’d loved to do what the guy wanted, but they wanted to do it from their home office and didn’t see a reason to come into the office. All they needed was a laptop and a phone. If you have that kind of position, like somebody in sales or in bookkeeping or someone that’s not involved in manufacturing shirts, maybe you want to look at that option for staffing or at least add in that alternative workplace to your conversation.

Marc Vila:
Yeah, that was actually something that came into light often when I was doing a bit of this research was… and I didn’t put it on here as an issue because I don’t see it as much in custom shops, but it is true of the idea of a flexible or blended work environment that a lot of companies are willing to pay for staff to say, “Well, Monday through Wednesday, you have to do stuff in the office because you’re doing office things. But Thursday and Friday, you’re doing Excel spreadsheets and computer work.

You can go ahead and do that from home.” Especially backing up to the last point with inflation, gas is more expensive. All these things, eating lunch out is more expensive, as you mentioned, with your $90 Indian food. When folks can stay home, and they can save the gas, and save the time, save paying for childcare, whatever they can do, it makes it a lot better. I mean it’s a whole conversation about watching your employees all the time, making sure that you’re getting every nickel out of them.

Mark Stephenson:
But just in general, for the purposes of paying attention to how you staff your business and how you do production, you should maybe be more… you’ll need to be more flexible in the money that you pay, the environment that you provide, and the flexibility that you allow if you want to maintain a good quality staff through the whole year.

Marc Vila:
Again, it’s back to doing things that make sense, don’t necessarily dig your heels in on what you pay people for flexibility in the job, what the work environment is like, what it’s like to be a boss or an employee. It’s just with the competitive market… when there’s a competitive market, people are looking for a good place to work. Right?

Mark Stephenson:
Yeah. Good point.

Marc Vila:
Let’s see, we have the next one, increased customer expectations. people can get things faster than ever. They can get things more personalized than ever. They get communicated to more than ever. The expectation of what’s good and what’s fair changes and some of these things you can control and some can’t. Amazon will ship you five bricks overnight for free. I don’t even know how, it’s like $4 and it’s 100 pound package. Oftentimes, business owners, even a company of our size at ColDesi, we can’t… a mug is $1 or two.

It’s an 11 ounce mug, that’s three quarters of a pound or something like that. Case these things, it’s like 30 pounds. It costs more to ship it than the product. How are we going to ship that for free? We raise the price to cover the shipping or we make it relative based on where you are. You’re a business owner out there too. You understand if a customer was going to order shirts from you and you have them, and had them at the lowest price possible, and it was going to cost $50 to ship them, and that was your entire profit for the order, how can you continue doing that?

There’s challenges with this, that being an example of a challenge. But the good news is, there’s actually a lot of good news, is because people want this personalized stuff that’s fast, if you’re a small business owner that delivers a lot of things locally, you’re in the customization business, and you could deliver things locally to people. That’s opportunity for you. The business that we’re in is going to continue to grow as people know that they can go somewhere and they can get a mug that they don’t have to pay a ridiculous amount of money to ship, personalized, right there. Maybe the same day.

Mark Stephenson:
Yeah. I’ve got to say, I’m starting to appreciate local businesses more as I see so many Amazon trucks on the road and I have to break down 11,000 Amazon boxes every month. It can be so much more satisfying to actually talk to a person. Even if someone orders a dozen shirts from you, and it’s a new customer, and you have the ability to get in a vehicle, or send one of your people out in a vehicle, go and meet the owner, and make the delivery, that cemented connection is a huge advantage. The more and the smaller companies get that are looking for customized goods in your area, the more personally you can respond.

I mean, that is a hedge against any of these changes that we’re talking about. Because when someone knows you as a business and likes you as a business, they’re maybe willing to overlook that you still ask them to write you a paper check, or they may be willing to pay a couple of bucks more, and not make a big deal out of it, or wait a little bit longer, or accept your advice on an alternative blank if you’ve cemented that relationship. Developing that customer expectation in your favor is a big hedge.

Marc Vila:
Yeah. Because part of customer expectations is being treated well, wanting to have good customer service, because with a lot of competition out there, when there is a lot of competition, in this world, there’s tons of competition, why would you go somewhere where they don’t treat you well when you can go somewhere else where they do treat you well, and you know the person, and they remember certain colors that you like, or whatever it might be? If you’re doing customized things, they know a little bit about you, so you know a little bit about them.

That really does cement an increased customer expectation of stellar customer service that you can deliver locally by being face-to-face, hand delivering things, and we talk about other things you could do. In the past, we’ve talked about bringing a can cooler or a hat as well and just delivering it with the shirts. Or with the signs that you made, you also deliver a hat and be like, “Hey, by the way, I’m giving you this.” It’s like that expectation, you have an opportunity to upsell, to deliver customer service, and deliver things faster.

Because if somebody wants to go to say Vistaprint to order something customized versus you, if you’re in their town, and you have mugs in stock, you could potentially make those mugs, and bring them to them, or have them stop by your shop and pick them up the same or the next day, or even the second day, where Vistaprint’s not going to get it to them for say a week. Plus they’re going to have to pay a shipping charge, potentially a hefty shipping charge for something heavy like that. There’s a lot of opportunity that you can deliver this way, but you also really have to consider with these increased customer expectations, that goes back to some of the other stuff we talked about before, being able to pay in an easy way, stuff like that.

Mark Stephenson:
I really want to bring that back around to the stocking up, particularly when we talk about supplies, blank hats for example, like you said with the mugs, is imagine the conversation and how happy a customer’s going to be when they call to order. Not only can you provide them great service and great quality, but you can say, “I keep these caps in stock, I can bring them to you tomorrow.” That conversation is going to be the only one like that they have, because they’re going to call eight places, and it’s all going to be seven days, 10 days, that’s out of stock, it’ll be two weeks until we get them in. You’re going to say, “You know what? I’m going to go get one out of the back right now and do it for you while you wait.” You’ve got a customer for life.

Marc Vila:
Yeah. When you solve one problem, you sometimes are solving a second problem too. Mentioning things in stock and potential back orders and all that stuff, if you do keep some things locally available, then you’ve got an opportunity to sell or upsell a customer or just sell them in the first place because you’ve got it and it’s ready to go. People want things fast and personalized. If you’ve got a digital print system and mugs in stock, you could literally personalize 10 mugs with 10 different names in minutes while a customer waits potentially. If you have the opportunity to do that, then yeah, it’s going to cement people in, just like you said.

Mark Stephenson:
Yeah. Terrific. All right.

Marc Vila:
So we’ve got one more.

Mark Stephenson:
The last one is definitely really close to me and that is the transformation of gig workers or the conversion to the gig economy, where people are looking to work for short periods of time or for a company or do different things, work completely flexibly… completely flexibly?

Marc Vila:
There you go. Maybe.

Mark Stephenson:
I think that might be it. I’m not sure. They’re going to want to work when they want. They can do piece work, not be employees. There are definitely some ways that you can take advantage of this phenomenon in your customization business.

Marc Vila:
Yeah, absolutely. As you’re growing, it’s increasingly easy to find people who are willing to do a small job for a small fee rather than necessarily wanting to work full-time. This could be anything from bookkeeping, to potentially sales, to delivery of goods, anything like that. You can find plenty of people who just want to work gigs and whether they want to do it full-time or they’re looking for a little side hustle to make a little bit extra money, because of inflation or something like that, all this stuff is you could do little jobs, and you can help grow your business by utilizing this gig market out there to be able to pay somebody for a job that you’re making a profit on right then and there. Then there’s no other costs after that.

Mark Stephenson:
It’s funny, because I was talking about ColDesi and all the equipment that they sell and everything. It seems like when I talk about that, a good 20% of the people that I talked to have done screen printing at some time or another. It’s like, “Oh yeah, I did that for a month in college.” Or, “I had one of those home screen printing kits,” or something like that and they really enjoyed it.

Or they’re just crafters and they do different kind of printing and stuff. Those may be a great source. Maybe if you have a big job, you need somebody to come in for a few hours. Or if you get all the complicated stuff set up for a screen run, maybe you can train somebody that just wants to do something with their hands that’s used to sitting at a keyboard all day. Maybe you can train them up and they can come in for a couple of hours a week, making a few extra bucks.

You can figure out what Uber drivers there are in the area and what other skills that they might have that they’d prefer to do, like Marc said, whether it’s in sales, whether it’s something in the shop, maybe somebody from a local high school wants to fold and pack. There’s a lot of options for you to take advantage of people that aren’t looking for a full-time job and don’t want a contractual relationship, but they’re very interested in making some extra bucks when you have extra work.

Marc Vila:
Keep your mind open for stuff like this. We have a lot of customers like this. This is an example that comes to mind. You have moms with young children that know that they are embroiderers and they just do it as a hobby. Because we have a lot of those phone conversations where some of them are looking to actually invest in a machine and potentially run a little side gig, but maybe… definitely, there’s people out there just like this that maybe you can develop a relationship with that can come to your shop every once in a while when you have big orders to do and you say, “Hey, can you help me run embroidery machines for a while? Every time you come in, I’ll pay you $100.” Whatever it is. There’s just a lot of opportunity. The last point on this, Mark, you brought it up and I want to give you credit for it.

Mark Stephenson:
Yeah, thanks, I appreciate that. That’s pay attention to gig workers and freelancers as a market. When we’ve done all of our niche market podcasts and when we talk about looking for niche markets, it’s normally based around a business with employees. Like you’re going to address plumbers or landscaping services or whatever. But there are people that do marketing, and they do freelance writing, and they do things on a 1099 basis instead of for an employee. Swag is still important.

If you get a business consultant that they work online, they work by themselves, but they work with some very important clients to them, then they probably would want a shirt with a logo on it for Zoom meetings. They might want to send a thank you basket that’s got a T-shirt with their logo on it and some tchotchkes to potential customers. They may be in an industry, like even real estate agents are… most of those are 1099 contractors. They don’t actually work for the company, for Coldwell Banker for example, they’ve got their own business and they get commissioned on the real estate that they sell.

They’re responsible for their marketing materials. You can get them a shirt with their name on it. You can get them things with their picture on it. You can sell them whatever things they leave behind at a real estate showing or thank you gifts they send to customers. You should make sure that you are aware of the non-traditional workforce in more than just ways that you can use them to help your business. But look at them as a market as a whole. There might be some opportunities for you.

Marc Vila:
For folks like that, it’s important to make those jobs profitable. If you can find a profitable way to sell small orders to gig workers, then you’ve got a huge market. If you keep it simple, “Hey, I have $100 package,” and it’s got to be something that you could do quick so it’s in and out of production and it’s profitable for you. Think of the quick ways you can decorate things, whether you’re doing transfers, or vinyl, or something like that. Pick products that are potentially low cost to the customer, but high margin to you, so you can make a good amount of money on each one that you’re making.

Like the can coolers or something like that could be an example. If T-shirts are really competitive, actual T-shirts, then that’s not the product you should push. Push for polos, hoodies, sweaters, sweatpants, whatever the other things are, hats. There’s just a lot of opportunity in that gig worker market too. That’s going to be something that if you pay attention, you’ll see the one that’ll work for you.

Mark Stephenson:
Yeah, I like that idea. When you talk about gig workers, there’s a couple of ways to think about it. One is a very specific definition. They’re like the Uber drivers and they deliver food. They work for a big company, but they do small things for it and they do it on an ad hoc basis, make their own schedule. But people are starting to widen that definition to mean anyone that’s a freelancer or a 1099 contractor, if you do your own taxes and you file a Schedule C at the end of the year, then you fall into that gig worker umbrella because you don’t have a boss.

You are your own boss. If you have a one person company, I’m going to slide into a bit of a pitch here, if you have a one person company, then you should look at things like the Association for Gig Workers and Gig Worker Solutions for more ideas on how to market your business and how to handle your finances. Because there’s a lot of things that you get when you’re an employee that people that come to work with you on a gig basis might be looking for as well. When you’re an employee, you get life insurance.

It’s a little bit, but it means something. You get your payroll taxes taken out. If you’ve been in business for more than a year, you know that self-employment tax, you’re going to pay 15% of your total just in self-employment tax to the government every year. There are ways to lessen that. If you go to get a loan and you don’t have a W2 because you’ve been doing your business for three years, it is a super pain to get income verification. You’ve got to dig up taxes and bank statements and things like that.

You, as a gig worker and as a self-employed person, can benefit by taking a look at those gig workers’ situations that you hire and applying that same thing to yourself. You can go to the Association for Gig Workers and sign up, it’s free, and start getting an education. That’ll all be launched pretty soon. If you are making some money and you’re thinking about it, then I’ll drop a link to Gig Worker Solutions. You should definitely check it out as another way. One of the reasons that I think about this too is because I do the marketing for the Gig Worker Solutions company and we are just setting up a team store for the people that are affiliates.

These are people that are basically gig workers for us and they’re going to order from a team store Gig Worker Solutions branded apparel and tchotchkes that they can give away. Look for those situations too. Just because somebody’s not a traditional employee doesn’t mean you don’t have these bigger opportunities, because I think the people that are setting up the team store for us are just going to make a boatload of money selling to gig workers.

Marc Vila:
Yeah. I think that goes perfect into wrapping it all up, that challenges are expected in 2023, just like in 2022. But there’s still a ton of optimism, especially in our industry, with the customization and people wanting to deal with small businesses and dealing with small businesses is becoming a cultural virtue now as well.

Mark Stephenson:
True.

Marc Vila:
It’s becoming a cultural virtue. This is a great time to be a business owner. As long as you’re focused in the right direction, you’re flexible with your ideas, you’re flexible with how you treat employees, you’re flexible with adopting new technology, how you traditionally work with people, how you traditionally order and keep your stock, I think that being malleable is probably one of the best ways to be successful in a time like this.

Whenever I talk to either friends or people that we’ve interviewed for jobs and things like that, if they work for a company that is firmly dug in the ground, they want to leave. People don’t want to do business with companies that keep their heels dug in, “No, we don’t do that. We never do that. We haven’t done that in 30 years.” Okay, are you still riding a horse to work every day?

Mark Stephenson:
Right, right.

Marc Vila:
There’s a lot of opportunities and a lot of optimism. I think some homework we talk about sometimes, I think you should go through this list and shore up your business a little bit. Take a look and look at how you would handle supply chain issues. Ask yourself these questions. What am I doing to stay ahead digitally?

What am I going to do if prices go up on particular products? How did I handle that last year when prices went up? What am I going to do about hiring people and talent or gig workers? Then within all of these things, look for opportunities on how you can make more money, increase your revenue, sell more to your current customers, and get new customers.

Mark Stephenson:
I don’t think there’s anything else to say.

Marc Vila:
Okay.

Mark Stephenson:
That was very well said.

Marc Vila:
Then, we’ll just wrap up then with a ColDesi commercial, because this is a ColDesi podcast. If you’re not familiar with us, check out coldesi.com, C-O-L-D-E-S-I.com, and you’ll see links to all different types of stuff. The hottest stuff lately has been our DTF or direct to film printers. It’s just been a really hot product. It’s beautiful technology.

If you’re not doing that right now and you’re looking to do some production of transfers, you should check it out. Embroidery machines have been getting hot again lately. It’s another way to really customize and create a high-end type piece of customized apparel that the cost of production is particularly low. If you’re interested in either of those things, be sure to go to coldesi.com and live chat with one of the folks there.

Mark Stephenson:
Fantastic. I highly recommend it. This has been Mark Stephenson from ClientsFIRST Marketing.

Marc Vila:
And Marc Vila from ColDesi.

Mark Stephenson:
Have a great business.

The post Episode 186 – Getting Ahead of 2023 appeared first on Custom Apparel Startups.