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Uniform Profits Long Term

Originally the theme of this article was to be secrets of selling long term uniform contracts. As I interviewed successful experts I realized that there are no secrets. There are fundamentals mixed with technology. The concept of listening to one’s customer and then servicing the heck out of them has not changed since ancient times. While your ideal client may be large or small, economies of scale confirm the old adage that “the big ones don’t let you eat and little one’s don’t let you sleep.”

High sales volume buyers will demand very sharp prices. Accepting paper thin margins can be justified based on huge volume. High capital investment in inventory is required and this can be a barrier to entry for many vendors. The small accounts can produce a higher mark-up but the servicing requirements can be cumbersome requiring the dedication of resources not proportional to the business volume. How does one arrange to charge a reasonable price to cover the cost of service? Here is where technology can deliver value.

If you ask Tom Hopkins, expert sales trainer, the key is to building long terms relationships with clients is very similar to building long-term friendships. You have to develop friends. Not that you will always plan to socialize but to the extent that there is a level of care and trust established. Long term relationships historically have been described as inuring to the benefit of the seller. But you will likely not be selling the same thing to the same person constantly. So there is work involved to be ahead of the curve in anticipating the needs of your client and identifying ways to deliver value.

Common now are budget cuts plaguing police departments and commercial firms. The sale may be more challenging to close as your company competes not only with the uniform budget but also allocations for personnel, vehicles, weaponry and ammo. Part of this conundrum is economic and part is political and exacerbated by the current government policies, according to Richard J. Lerman, president and CEO of the NAUMD. In the bid process you want to develop a discussion and not just deliver a sale’s pitch.

While the sales person is incentivized by closing a sale, management needs to reconcile supporting the long term goals of the company with the sales representative’s compensation. Experienced pros will tell you that landing a multi- year contract may take a year or longer. Patience will be rewarded for the winning vendor as the contract should be awarded for a number of years.

Police chiefs want better and more modern items. It is no longer enough to have reliable body armor but now it needs to be camouflaged to further protect officers, according to Lerman. Ask for ‘what keeps your buyer up at night?’ Understand the needs of the end user along with those of the buyer. Develop a process of regular communication so the buyer can rely on your delivering value now and in the future. Learn how to be persistent without being annoying. And even after the relationship is set there is the risk of the buyer changing jobs.

People will remember your friendship and that you have performed when they relocate to another company. After all, you enabled their success if you have done your job right. That customer contact will be valuable for future sales growth. Here is where the personal relationship that you worked to develop will endure.

A smart vendor will know their clients well enough to anticipate their needs before they are declared. Harvey Klein, president of Red The Uniform Tailor, (Red) strives to know the buyer’s needs a little better than the buyer does. For example, Harvey will take some risk and purchase extra fabric as he expects a re-order in the near future. He will be in position with raw material to be able to turn and deliver on short notice.

One of Harvey’s main business strategies is to not manufacture what the client can buy elsewhere. Then you are competing mainly on price and the margins are typically unattractive. Rather, Red custom designs and manufactures uniforms for police departments, theme parks and casinos. For a number of these accounts Red has qualified, after years of service, as a ‘sole source’ vendor. Red guarantees the fit and delivery is reliable. Competitors cannot or typically do not chose to provide this level of service.

Some customers may call up to ten times a day. The more the better! Requests from theme park business can be bizarre as costumes are created to replicate those seen in movies. Do whatever is necessary not to lose the customer. They will pay and continue to pay reasonable and profitable prices. Do something no one else is willing or prepared to do.

A further service feature that is available and possibly expected today is the company store website specifically designed for the customer’s employees to facilitate and control uniform orders. This technological advance, which has proven successful, is provided by my publisher Rick Levine, director of sales and marketing for Sellers Commerce. Rick and his team can help you develop this service while you concentrate on other high value endeavors. In addition to assure that each employee received the correct articles of clothing, you are further in a position to give your client immediate accounting feedback and enable you to better plan inventory requirement and save costs.

The data can be shared with the buyer to help plan the next season purchasing. Harvey noted one customer who thanked him for saving three weeks of work by having the historical numbers available. Can the cost of this service be covered? Yes, if you are sharp in sourcing and utilizing technology which also helps work with your supply chain by providing information that will enable your suppliers to offer better prices.

By anticipating customer needs and projecting accurately, you can assist your vendors to be in a position to purchase their raw materials more effectively. This should lower their costs and their price to you. Better planning and communicating with your supply chain should enable more reliable delivery and reduce distribution expenses.

At Greco Apparel, we offer value to our clients by extending the time they have to make decisions. For example they can assort colors well after the greige goods are woven. By having the correct raw materials at the factory, the client can determine exact sizes, styles and colors just one day before cutting begins. You can essentially manufacture to order and have a quick turn time by producing in the USA and Latin America.

Ultimately the secret is that there is no shortcut to hard work and constantly improving through technology and education. This may be the key to making your own luck for success which is vital. As Baron Rothschild said “95% of success in business is luck and the other 5% is luck.”

By Joseph B. Greco MSOD

This article also appears in Made to Measure- The Uniform Magazine in Fall/Winter 2014 edition, which you can see here: http://www.madetomeasuremag.com/madetomeasurefallwinter2014/index.html

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