When Times are Tough

With over 35 years in the embroidery industry with particular emphasis on writing, education, and digitizing, Helen Hart Momsen is widely published in the trade press. Momsen founded and moderates the Embroidery Line (www.embroideryline.net), the longest continuously running internet forum for apparel decorators. A sought-after speaker for many years for THE NBM SHOW, Momsen has authored two ground-breaking books on professional embroidery, available at www.Helenhart.com.

The word on the street is . . . our economy is suffering. Duh! People are cutting back and many embroiderers are worried that any level of recession will cause their corporate customers to expand the definition of what they deem “non-essential.” A bleak picture? Yes, but not without silver linings.

An embroiderer lives in two worlds. On one hand we are the buyer and are looking for bargains: the best shipping, just-in-time inventory control, and not a lot of pre-buying and storing of essentials such as backing, thread, needles and so on. On the other hand, we are the seller, and our clients are looking for the best prices in order to continue to use our services.

It is human nature to look for the best deals and the lowest prices. We remember that, when we are the ones doing the shopping—looking for a used machine, case or bulk pricing on shirts, fire sales where one person’s misfortune becomes our gain. When we are watching our pennies, it is hard to look on the other side of the deal, but the best price is truly negotiated with dignity and is fair for both sides.

I have always been a believer in the “don’t compete on price” philosophy. We tend to give in to the pressure the customer brings to bear when they tell us the shop across town is much more reasonable than we are. Some lower their prices and may end up pricing themselves to a below-profit level; the going-out-of-business sign is the next step.

I think better avenues to explore include cutting our costs in effective ways so we can hold the line on pricing or offer a discount for good reason, providing service to justify price, adding other streams of revenue to our business to draw in the customer, or finding exterior outlets for products and services whether we are adding additional retail exposure to our business or finding a retail spot to augment a home-based operation. There is always room for the creative in embroidery, whether it is in marketing or in design.

With these things in mind, let’s explore some methods that will keep the madness at bay and perhaps benefit our bottom lines. Suggestions often stimulate the mind into finding solutions, so put on your embroidered thinking cap as you read.

Cutting costs

I have told this story in my seminars—and perhaps in a previous column—but it is always a good thought-provoker when talking cost and price:

Years ago, the price of candy bars was set to rise, across the board. But one candy company did not participate in the price hike and their sales shot up. Closer observation (my Father had a hand in this) showed that the price stayed the same, but the candy bar did not. It was smaller, just by a fraction of an ounce, than the other bars. The company was able to hold the price—a thing in which the consumer is (sadly, sometimes) most interested. I am noticing the same thing today in the ice-cream aisle. Going out to buy what looks like a half-gallon of that confection means coming home with a tub that holds 1.75 or even 1.50 quarts. The company is able to maintain quality and still get what is essentially a higher price for its product.

We can do similar thing in our shops. We can hold the line on excellence while finding ways to boost the price “internally.” Maybe we can experiment more with backing and find ways to use one piece instead of two. If you buy the more expensive pre-cut backing, maybe it is time to buy it by the roll and cut your own,  giving you a selection of small pieces for smaller designs. I use the very smallest as packing when shipping my books and other products. The smaller pieces can even be recycled into holiday greeting cards. Stitch an appropriate design then slip into a “window-card” for a message that shows what you do.

Maybe we can explore ways to use underlay (a little more thread) and eliminate the more expensive topping. We can search the Internet for sales on the embroidery essentials; check out auction sites for liquidations of small—and large—shops. Perhaps we can boost our production by running the machines faster; something that is possible when the goods are hooped very well and the design is digitized with an eye to efficiency as well as smooth stitching.

If your business is solid, consider investing in multi-head equipment so you can do more than one piece at a time, keeping the profit for you, not passing it down to the customer. A $30 shirt on a single-head equals $120 on a four-head. And times are tough for the machine dealers as well so you might work a very sweet deal and boost your production capability.

Service justifies price

Consider offering delivery or “free” shipping if you can work the cost into your price. We all know there is nothing really free, but you can find ways to offset costs and offer “free” stuff. One thought here: I never discount embroidery. I will discount product bought through me in bulk, but my embroidery quality is based on education, knowledge, application and experience. Teach your customers to value your work as a professional; one way to do that is to hold the price on your experience.

Make sure you honor your commitment and earn a reputation for reliable service. Good service holds a customer far longer than low prices and fast talk.

You should carry insurance that covers the value of all goods in your shop, including any customer-supplied goods. A fire or flood can wipe you out if you are not insured. Let your customers know their goods are insured—it can be touted as another “service” you offer.

Expand your horizons

Nothing adds more excitement to a business than adding other streams of revenue to draw in customers. It is exciting for them to discover the many different and mixed decorating processes we can bring to our work but, more important, it brings excitement and challenge to our lives. Our whole outlook on business and possibilities (my favorite word) can change drastically when a new procedure is mastered and then offered to an appreciative client base.

A low cost investment is a heat press which can be used to apply ready-made transfers (and then add a dollop of embroidery?) or even for something as simple as heat pressing your embroidered logos. The heat setting not only presses the embroidered area to reduce any puckering or cupping (lasting through washings in many cases) but also tames any little thread ends that can mar the appearance of even the most professional embroidery.

Now that you’ve got the heat press, learn to use that CAD-cutting machine sitting in the corner, or buy the one sitting in the corner of another shop. Save time and stitches by using material in appliqué and tackle twill creations, or just add a touch of material as an eye catcher. Don’t overdo it and use fun colors and patterns, and it can really perk up a design. At the same time you will stimulate interest in your services and products because of the new look.

We can use that same cutter to cut out transfers made with an inkjet printer and apply them with that new heat press to offer an alternative to the more expensive embroidery process. We can combine printed designs with embroidery to offer shirts with a “punch” that is less costly to the consumer than just embroidery, but adds the wallop of a mixed-media product.

Save the leftovers from the CAD material and make labels for your custom shirts and other creative goods.

More exposure

You can beef up your exposure not only by adding new application processes, but also whole new departments in your existing retail outlet. I recently read some inspiring stories and talked with people who are doing just that.

One retail embroidery shop, already offering sewing alterations as a side-line, added a room of gently used, high-quality garments—some purchased outright, some on a consignment basis. They were able to sell an evening dress and a wedding dress at lower than the original price, but still at a nice profit, by being able to offer “free” alterations for the client on the spot.

Another embroidery store specializing in sports and hunting embroidery added a section that sells new (close-outs) and gently used sporting and hunting clothing and equipment. They are helping their clients realize some return on consignment items as well as adding to their own profit. An added bonus is being able to personalize the cases and garments purchased.

High-end artistic boutiques exist that allow you to put your products in on consignment. One that I have joined charges rent as well as a 10 percent commission, but the store advertises on the Internet, holds art receptions and civic gatherings and, thus, caters to a clientele that can afford more than a shopper in a flea-market environment. I can offer embroidery as a service, sell blank goods, and exercise my creativity by filling my booth with creative things—not only to see “what works” but also to creatively eliminate overstock or other slow-moving goods by decorating them in a one-of-a-kind fashion. I have worked hard to offer unique hand-crafted and judiciously assembled gifts and gift baskets to present an image not found in other booths in the building. Many of the shops are filled with merchandise purchased from the well-known gift marts––things that can be found in any gift shop. Strive to be different and you will catch many an eye.

One enterprising embroiderer I know cut a “window” out of a personalized shirt that was unsalable and used a beautiful placemat to fill in the window, creating a new shirt that was recycled on two fronts.

Final thoughts

Don’t forget to educate your customers about the tax deductions allowed for advertising. If they are looking for ways to boost their businesses in these difficult days, why not do it with employee shirts or give-away caps and garner wearables and good-will, as well as advertising and the deductions allowed for it.

Be heartened that many companies that have bought in large quantity from overseas markets might be willing to visit—or re-visit—the idea of buying locally. Drop in to see them; nothing makes it more personal than a face-to-face, which they don’t get from the thousands-of-miles-away suppliers.

Sell them on the idea of the same just-in-time ordering technique you use when you order products. JIT, which is easy with a local provider, can save storage space and cost. Investigate the idea of setting up a “company store” for them on your website. (I hope you do have one, even just to use as a brochure.)  They might just love the idea of sending employees there to order what they want. Consider making labels for their shirts using your leftover CAD material with their company names on them.

I send my hugs out this month to the family of Jeff Banks. I learned that Jeff had passed away as I was writing this column. Jeff was a mentor to many people on my Embroidery Line and was my right hand and rudder when I started the Eline nearly a dozen years ago. There wasn’t a computer or forum problem he couldn’t solve and he had the best laugh I ever heard. We had our differences, but I call him friend and always will. I could have chosen differently from the volunteers who raised their hands all those years ago, but I couldn’t have chosen better. May his soul rest in peace and may he and his family be held fast in God’s hands and find comfort there.

—HHM