| In the arena of products imprinted with branding messages,
there is a unique interrelationship between quality, price, and
service. It is easy to become a promotional products producer, distributor
or commission salesperson. Capitalization and experience requirements
are modest for distributors. For manufacturers start-up or acquisition
investment can range widely, but the necessary fixed assets are
easily financed. The common imprint technologies are inexpensive.
And they are simple to operate.
With minimal barriers to entry, the promotional products industry
has attracted an interesting mix of players at all levels. That
leads to quite a variety of business practices. But there is no
mechanism in the industry to police practices or enforce standards.
Despite the laissez faire environment, many companies are incredibly
creative and ethical. That's especially true of factories - some
produce impeccable quality day in and day out. Nevertheless, over
the last few years competition in the industry became substantially
based on price because it is the easiest and least expensive way
to make sales.
So plenty of vendors are willing to do it for less - whatever
"it" may be. Under pressure of deadline or internal
finances or price competition or staff inexperience or customer
inexperience (that's a big one), plenty of factories and distributors
will cut corners to save some time here and a few nickels there.
That is the nature of the price competition in the promotional
products business.
Here's how it works. Many variables affect the cost and quality
of products, imprints and customer service. Many steps are involved
also. That means there are plenty of potential shortcuts. Those
shortcuts exist in the pre-production phase where client art is
sized and adjusted for imprinting on products and production screens
and dies are made, colors are mixed, etc. |
For
years we supplied public radio stations with tens of thousands of
a reliable little FM radio about the size of a Bic Lighter. We had
named it the Tom Thumb! Then one season we received our first complaints-
all of a sudden the supply we were distributing had no long-range
reception. The importer couldn't figure it out. As far as he knew
it had been the same product all along, supplied by the same factory.
Then, while comparing the innards of a disappointing new version
with its exact duplicate from a couple years earlier, he checked
the Hong Kong patent numbers etched into a tiny electronic chip.
Sure enough, after several years of dependable production the factory
had shifted to a cheaper chip and saved a few cents.) |
|
Separate from this stage there are
more shortcut possibilities in the mass-production process, which
occurs in two phases. Phase one is fabrication of the un-imprinted
product. Phase two is imprinting the client's logo on that product,
usually at a different factory and often in a different country.
And finally there are obvious shortcuts in the post-production
quality inspection of imprints, a process that can range from
rigorous to lackadaisical, the latter permitting a lower cost
because it also permits a larger number of sub-standard products
to be shipped to the customer.
Every production step has a cost. Most steps have an optional
shortcut. Each shortcut is a cost saving opportunity. As we said
in the main text: When pennies count, dimes rule. When dimes rule,
quality is sacrificed to price. The quality deficit shows up after
an item has been used for a while. Make your store's purchase
decision on the basis of price and you become vulnerable to this
reality.
All product suppliers know that cost and quality are joined at
the hip. The best ones are both experienced at and committed to
protecting brand equity. They understand how production shortcuts
often risk end-user satisfaction. And they protect their clients
brands with market knowledge, production experience and a commitment
to consistently secure the optimum balance between product cost
and product quality. |
