Preparation is key
Rising interest rates: check. Inflation: check. Gas prices rising: check. These are all signs of a recession. Is it already here? Some say yes and some say no. Regardless, I’m going to share two strategies to help you mitigate whatever happens in the economy.
STRATEGY #1
SCALING
Every business person should understand the concept of scaling. It entails the ability to support growth in one’s company without substantial increases in cost. In mathematics, scaling is the practice of enlarging or shrinking objects or numbers by a scale factor. Think of scaling geometrical shapes in perfect proportion. Once you understand that concept, try applying it to your business.
How do I apply scaling to my business?
In a recession, we often see companies diminish their budgets across various departments. Hiring freezes occur, travel expenses are slashed, and marketing budgets are often scaled back.
As a promotional products distributor, supplier or an end-buyer, this doesn’t necessarily mean that with lesser marketing budgets the advertising effectiveness needs to disappear. In fact, it offers an opportunity for creative people to scale their advertising within any budget.
Many companies spend a lot of money on marketing at trade shows and conferences. In a thriving economy, it’s not uncommon to use high-end promotional products to capture an audience’s attention. But if effectiveness represents a geometrical shape and price represents the lines of that shape, then by using the principles of scaling, one should be able to change the price, yet maintain the effectiveness as we would when we scale a triangle.
Here are a couple examples showing how:
1. The Martini-Vispak silicone cellphone strap is a low-cost (under $5) /highly effective solution for promotion marketing. Serving as a cellphone holding accessory for improved security and reduced drops, it is also a tremendous vehicle for very visible branding.
According to IDC Research, 79 per cent of adults have their smartphones with them 22 hours a day.
Conclusion: You don’t have to break the bank to employ effective advertising when you align your marketing investment with a targeted audience and a creative solution.
You can even create an opportunity for consumer engagement by demonstrating how to easily add this product to any phone with a case and its effectiveness as an accessory. Let's look at another product category for a way to scale promotions.
In this next example let’s say you own and operate a ski chalet. During a recession, there might be less visitors due to consumers having less disposable income. But your staff still need to have the proper attire in order to stay dry and warm, right?
Well you don’t have to break the bank with name brand winter jackets.
2. The Moncton Urban Jacket by KLo Canada is an example of how you can look to manufacturers that supply high-end retail companies but have a less conspicuous presence in the promotional advertising field. The Moncton Urban Jacket is a winter fashion masterpiece and has a heat index rating that certifies comfort at up to -30℃ (looking at you Eureka, Nunavut and your average temperature of -18.8 °C).
Scaling your apparel purchases doesn't have to mean giving up on top quality for your employess or customers. You can work with your local experts to discover equivalent (even superior) performance, at a savings.
Revisiting your decoration strategy could uncover more opportunities to scale your operation. For example, using patches to personalize uniforms instead of direct-embroidery could reduce the need for replacement product if you are able to clean and recycle the uniforms of departing employees.
STRATEGY #2
FACTORY DIRECT
There are many ways to scale your promotion, one of which involves thinking outside the box (or the continent) when it comes to visibility.
With journaling becoming incredibly popular with all age groups, pens are a natural fit for low-cost and high visibility marketing. And even if your marketing budget has diminished, it doesn’t mean that you have to get a lesser quality pen. In fact, you can often have the same pen you used to use and spend less money.
How can I spend less and still get the same thing?
Here’s how to do it:
Promotional products suppliers like Kustom Promos, Spector and Co., HPG and many others, all offer factory direct options that cost less than their domestic offerings. The catch is that you have to be prepared.
To get the most out of your promotional product investment you can’t order a day or a week before your event. Planning ahead will open you up to discount opportunities, especially for large bulk orders, and can help reduce your shipping and distribution costs.
Most established companies have a good handle on their annual calendar of events and with a little foresight can save a ton of money. For example:
3. The Milo pen from Kustom Promos starts at $0.89 each for as few as 5,000 units. For some companies this quantity may seem massive, and for others it's only a fraction of their annual need. The scaling math is the same, regardless. A similar pen, ordered domestically, could cost at least $1.85 per unit.
Does the savings ($4,800 in this example) improve your business position without having a negative affect on the effectiveness of your promotion?
Probably, and that's the value of comparing a volume purchase to a series of smaller purchases. Here's another option:
4. There are companies in promotional products that have a division dedicated to overseas imports. The delivery timeline and minimum quantity order requirements may seem intimidating at first, but take a moment to put those figures into the context of your business. Do the potential savings start to make sense?
When you view your promotion marketing investments from a wider timeline (and don't be afraid to consider multiple years if you have an annual or recurring campaign need), you open opportunity to create something completely unique to your brand, made specifically the way you want, at an overall cost comparable to your traditional buying habits.
Simplified Sourcing is a division of AZX Sport Canada, that makes overseas ordering easier for buyers by rolling in all duties and shipping costs to provide a one-price solution.
According to Michael Williams, Director of National Accounts,
“We [AZX] provide customers an opportunity to customize their favourite ideas at a price that’s incontestable and a delivery lead time that’s world-class.”
He cites socks, beanies, lanyards, and bucket hats as being the most popular items.
Taking a look at a product example, Simplified Sourcing offers a pair of printed promotional sunglasses with rubberized finish and matching arms and frame in a custom Pantone colour (made to match your brand). At 1,000 units and an estimated five-week delivery time, the unit cost is $2.93.
A similar product, available in-stock with a similar print on the the arm of the sunglasses, exclusively available in whatever colours are already in inventory, are advertised at $3.83 each. Your ability to plan ahead could save you $1,000 and deliver an equivalent product, customized to your brand for superior presentation and impressions.
Even during a recession, creativity and success can be embraced.
When you're well prepared, armed with the mathematical principle of scaling and the know-how of partners that are adept at overseas import, then there’s always a way to keep your advertising engine running smoothly and driving your business forward.
In the face of economic challenge, dare to be bold. You may discover that the solutions you create in your most vulnerable time will blaze a path that leads to increased success and a thought leadership position.