A few months ago, I discussed how my company decided to fire our major account. While this was the right move, it was certainly worrisome to risk losing volume in a time of recession. But in analyzing our remaining accounts, we discovered that while these clients each represented lower sales volume, the gross profit was higher. This prompted me to recall one of the lessons my father Domenick taught me. He used to repeat the adage, “the big ones don’t let you eat and the little ones don’t let you sleep.”
It took a few years for this idea to sink in. The big accounts, with the large orders and popular name brands, seemed more glamorous. But we were squeezed on prices then and now. Sound familiar? The smaller accounts seemed to be bothersome for the amount of units they ordered but the gross profit margin was more attractive. Let’s remember the name of the game is profits and not just sales.
The aggravation or annoyance that you may encounter from handling smaller accounts should be ameliorated by the use of technology. With a sophisticated data base for enterprise resource planning, dealing with smaller accounts is made simpler. And they still remain profitable. Now that’s attractive.
In these challenging times, it’s important not just to review and select your account base but also to keep your mind and the minds of your associate’s wide open to new opportunities. Brainstorm with your team to develop fresh ideas for marketing and services. If you get fifty ideas contributed and only two are valuable, you are still ahead. Quoting from an Investor’s Business Daily article, Mr. Jay Forte, a consultant, reminds us to “tell your people that no matter what happens, we are all going to look for and take advantage of opportunities. By creating a culture of learning, where you’re soliciting input from all employees and sharing the latest news with them, you make it easier to include them in your hunt for opportunities. Have them gather information about you industry and talk to customers so that they’re always generating ideas.”
My mind is more open than ever since my thirty-six years in this apparel and uniform industry. Fortunately, I have been through a number of recessions so while this experience may not be easy, it’s not unfamiliar. Now is the opportunity to apply different thinking about services and products. A few weeks ago, I took an unsolicited call from a sales VP in the shoe business. Typically in the past I would have dismissed the call as a mistake as we are in the apparel business. But I decided to listen. This fine gentlemen introduced me to his line of high-quality, slip-resistant shoes. Something I would have never thought about on my own now seemed a very natural extension for my uniform and career apparel clients in addition to the clothing we currently manufacture.
After a few weeks of speaking to clients about this line and networking with sales people I have know for many years, great interest has ensued. We are on the verge of confirming our first orders which will total more than 100,000 pair (about 24 container’s worth) of a product that never crossed my mind until 2009! In addition, due to this product expansion, for the first time, Greco Apparel, will be taking a booth at the NAUMD convention in Las Vegas in April, and sharing the booth and expense with my new shoe vendor. I induced them to join the NAUMD as well. Today, during a meeting with that sales VP, he thanked me for taking his initial phone call! It is I who is grateful as well.
Further in response to client demands and new prospective business, we are in the process of setting up a small and flexible sewing line. We can handle various products, small runs and give very quick turn time. Mostly we outsource our programs to larger contract factories. While we will continue with that strategy, those factories typically don’t want to be bothered with the smaller orders. But they are profitable and a means to service client needs. Customized response on typical items and the ability to produce specialty products in this career apparel business is a service my clients are delighted to have. I would not have thought this business attractive if the economic environment had not changed. Abraham Lincoln said. “Always bear in mind that your own resolution to succeed is more important that any other one thing.” Think about it.