What does every sales rep want in a customer? Loyalty and reliable, repeat business. Such qualities are of course hard to find, but there’s one surefire way to keep customers by your side: company stores.

Michael Rosamond, owner of Fully Promoted Covington, LA (asi/384679), sees that firsthand with the 16 company stores his firm operates 24/7/365 for clients (along with various limited-time pop-ups). For example, take the telecom company with about 350 employees that was only spending about $1,000 a year on promo products with Fully Promoted. Rosamond knew it could offer more business.

Turns out, the client had a company store hosted by another distributor, but they weren’t satisfied with it. “It wasn’t refreshed often enough and the items had a lengthy four-week turnaround,” says Rosamond. “We said we could become their preferred distributor and offer them a company store that would be more satisfactory.”

The client agreed to switch over, and the firm’s overall spending with Rosamond, including the company store, now totals $30,000 a year – an increase of 2,900%. Rosamond knows company stores aren’t easy – “You have to be able to do one-piece orders quickly,” he says – but the rewards are rich. “It’s worth getting the extra business,” he says.

Unfamiliar with company stores? In essence, they’re e-commerce sites hosted by distributors on behalf of their clients. An end-buyer works with the distributor to stock the store with branded apparel and hard goods and makes it available for people to shop. Their obvious uses are for uniforms, incentives and school clubs and teams, but they have potential applications for virtually any industry.

And now, distributors are increasingly offering them as a robust addition to their menu of services. According to Counselor State of the Industry data, 44% of distributors offered company stores in 2018, compared to 31% the previous year.

The appeal to end-buyers is obvious: End-users can order when it’s convenient for them, often with the items getting shipped straight to their doorsteps. Plus, the end-buyer doesn’t have to manually track and place orders. This is especially helpful for apparel, which comes in many different styles, colors and sizes, making traditional ordering very complicated and downright stressful.

“Company stores give us business security with clients. And it’s a huge benefit for them because it’s a one-stop shop and a problem-solver.” Sarah Whitaker, Williams Advertising

Meanwhile, the distributor receives frequent orders from their clients, which generates what Rosamond calls “stickiness” with them. “These stores are high-value for our customers,” says Rosamond, whose distributorship didn’t have any company stores when he purchased the franchise four years ago. “They’re often an HR function, so they’re a way for distributors to also get into recruiting, new-hire packages, employee gifts and more.”

Sarah Whitaker, co-owner of Williams Advertising (asi/360402) in Hopkinsville, KY, says company stores allow distributors to become “ingrained” in clients’ businesses and less of an afterthought, a common lament in this industry. “It gives us business security with clients,” she says. “And it’s a huge benefit for them because it’s a one-stop shop and a problem-solver. We’re in a smaller market, so it’s definitely a differentiator for us.”

Company stores also match up well with consumer buying habits. According to ASI research, over three-quarters of buyers (77%) are comfortable purchasing promotional products online. Intuitive navigation, easy payment processing and quick shipping – all things that online buyers have come to expect – are possible with company stores.

Mike Brugger, president of Top 40 distributor Fully Promoted (asi/384000), which offers company store training and templates for franchisees, says it’s becoming imperative for distributors to offer them. “It’s a way to keep the customer,” he says. “And it’s good to have products in an e-commerce store in today’s digital world.”

For large orders with lots of variables, company stores can be a lifesaver. Say a large health insurance company will be hosting an internal end-of-year party and wants all 200 employees to be able to choose their apparel gift. Before company stores, a representative at the firm would often be tasked with tracking all the sizing and colors (if applicable) for every employee in an unwieldy spreadsheet, and then hand off the orders to the distributor. Now the company store takes care of all of that. Perhaps a school’s booster club is selling apparel as part of a fundraiser. Parents can log on when it’s convenient for them and place the order without worrying about digging around in messy backpacks for paper order forms, and the school doesn’t have to handle transactions or tracking.

“It takes the order process out of clients’ hands,” says Marc Brownrigg, logistics coordinator at Mount Forest, ON-based MARCC Apparel (asi/260748), which currently manages about 75 company stores. “No one has to collect all the sizes. One site is hosted, and they get a report of what’s being purchased.”

It also gives clients control over their brand and ensures there’s consistency across the items and with buyers. “It’s not 15 departments all sourcing their own products,” explains Whitaker. “If a company has multiple locations, the head office can say, ‘This is what we want people to buy’ and send out the link. They don’t have to worry about each location using a different logo.”

This is especially true for uniforms, which remain a popular item for company stores. Taraynn Lloyd, vice president of marketing at Edwards Garment (asi/51752), says stores can be set up so customers only purchase what’s been made available to them, and the imprint method and location are consistent. “It leaves nothing up to interpretation,” she says. “The new employees receive the link, they log in and place their order, and it ships to their business or home before their first day of work.”

They’re also a great option for company rebrands. A financial client of City Paper Co. (asi/162267) recently went through a major rebrand, and its revamped company store became a major player in it. Prior to the rebrand, the client offered mostly polos; City Paper sourced other apparel categories to add to the lineup, almost doubling the number of SKUs from 18 to 32.

“It was a pivotal time for them,” says Maggie Wright, City Paper’s marketing director. “We added a variety of new styles, including outerwear, button-downs and women’s cardigans, and we were consistent across the brand. People know what polo they’re wearing on Friday, but they can also purchase additional items.” The styles sold so well that City Paper and the financial client had a new problem: an extensive list of backorders. “The good thing is,” Wright adds, “clients can place reorders quickly.”

Inventory Versus On Demand
When setting up a company store, position yourself as the expert and help clients through the process. Knowing what they’re expecting and how you can deliver will help the store run more smoothly, says Brownrigg. “Problems can be solved in those first meetings,” he says. “At the same time, establish with them what you’re able to offer.”

One of the biggest decisions to make is where the goods will be while awaiting orders: inventory services or on-demand orders. On-demand saves storage space, but “it’s lots of one-piece orders, which aren’t as exciting for decorators as a 200-piece order,” says Stephanie Friedman, vice president of sales & marketing for City Paper Company. “And lead-times for on-demand can be longer than those from inventoried pieces that are already decorated.”

If a company has 500 employees around the country and requires everyone to have the same polo, then it makes sense to order them in bulk and inventory them, says Brad Moxley, associate director of the corporate business channel at Cutter & Buck (asi/47965). That inventory allows for quicker turns, better prices on decoration and shipping, and better margins. If the client wants to add optional styles to the store, like complementary outerwear and athleisure, those can be fulfilled on-demand because fewer will likely be bought than the mandatory style, and timing is less of a concern.

“I’ve seen companies with a very healthy mix of on-demand and inventoried,” says Moxley. “Big distributors have warehouse space, but that’s the challenge for smaller and up-and-coming distributors. Where do they store these goods? They might have a better margin, but they still have to spend money on storage.”

If a distributor can inventory goods, exercise caution. “Don’t commit to holding it without some type of promise,” Rosamond warns. “Clients are overly optimistic about how much will sell, and then three years later you’re still sitting on inventory. Have a written agreement with them. For us, they either buy it all up front and we hold it for them, or we buy it initially and then they have to buy back everything later.”

If styles are being purchased and inventoried, distributors have to try to predict how much of each style will sell. If a particular size tends to sell out quickly, ordering extras of it for quicker fulfillment is a good idea. But it takes some hands-on monitoring and management. “Most stores don’t tie into suppliers’ real-time inventory,” says Brugger. “If you have a popular fashion item and you’re expecting repeat orders, that could pose an inventory challenge.”

“Don’t waste your time setting up a company store for a client who orders twice a year. It’s the repeat business of consistent smaller orders that you’re looking for.” Mike Brugger, Fully Promoted

Experience will come with some trial and error, and after managing a few stores, distributors will have a better handle on what sells well. Wright says she keeps track of styles and sizes that have proved popular, but it’s still easy to end up with too much inventory. She advises clients to be more conservative, especially at first.

“We want a selection that people are happy with, but we’re not Amazon and we don’t want to be,” she says. “If you do too much, you can’t do anything well.”

Arguably the most headache-inducing aspect of apparel, particularly when sold over e-commerce, is sizing. The reality is that sizes from different vendors may vary slightly. To mitigate the chances of large-scale dissatisfaction with fit, Brownrigg suggests including the dimensions of each style on the company store, and indicate whether an item has a retail fit or corporate fit, which tends to run larger. “We include notifications to look at the dimensions,” he says, “and we make sure each style is marked with them.”

Whitaker notes that, while sizing for a particular garment may stop at 2XL, buyers could be looking for multiple sizes above that. “The larger sizes might be a slightly different style or color, or have an upcharge,” she says, “but the most important thing is to keep on brand and get samples of everything for the client.”

A good supplier partner will also maintain deep inventory and keep distributors apprised of upcoming discontinuations. Cutter & Buck has core styles that are always easy to replenish, and at Edwards Garment, sales reps let distributors know about upcoming discontinuations. “If a program is stocked with garments that we’re going to discontinue, we keep them relevant for the program’s duration,” says Lloyd. “And we won’t let anyone swoop in and take inventory meant for stores.”

Once a store is stocked, launched and humming along, don’t ignore it and let it languish. “Be in front with new options,” says Moxley. “It’s so easy to add and take away styles, especially if it’s on-demand. And you’ll mitigate the risk of losing business to another distributor.”

The Right Fit?
While stores certainly offer convenience for all parties (and repeat orders for the distributors), they’re not the best fit for all customers. “Don’t waste your time setting one up for a client who orders twice a year,” Brugger says. “It’s the repeat business of consistent smaller orders that you’re looking for. If they’re not a good candidate, don’t even introduce the idea to them.”

Other times, prospects might come to you asking for one. Get to know them first with regular product orders, says Friedman. “Do they pay on time? Do we understand their brand and objectives? Do they spend what they say?” she asks. “These sites cost money, time, resources and warehouse space, and it’s a hard relationship to break up, so let’s date before we get married.”

One way to try out a store is to set up a pop-up for an event that’s live for only a limited time. “Maybe something you already do for them could be turned into one,” says Rosamond. “The client will be happy to get away from the spreadsheets, and meanwhile, there’s not a ton of risk for the distributor.”

Before launching any store and making it live, all systems (such as business management, reporting modules and payment processing) should be up and running, and the software should be able to offer reports about the styles, colors and sizes that are selling or not. Don’t risk your client sending people to a store that’s not fully working – it won’t reflect well on your customer or you.

If the client wants to offer coupons or vouchers for buyers to use to purchase items, those systems should be tested as well to avoid what could quickly turn into an accounting nightmare. “Some clients offer their employees wardrobe buy-downs, so they give them maybe $150 a year to spend on garments,” says Lloyd. “It’s a credit, and the software can take care of that. But make sure it’s up and running.”

Most importantly, be honest with clients about what is and isn’t possible. “That comes with experience,” says Brownrigg. “They appreciate being told what’s realistic. And be open to failures. Some distributors are quick to shut it down or dismiss it if it doesn’t work. You have to learn on the fly.”

Software Matters

With e-commerce continuing to expand and advance, businesses now have a plethora of third-party software options to choose from.

Michael Rosamond of Fully Promoted of Covington, LA, uses a robust proprietary system for 24/7 stores and a third-party provider for pop-ups. Sarah Whitaker of Williams Advertising has used Square for pop-ups, like taking orders at a fundraiser, but mostly uses ASI Company Stores. Deciding between a custom-built or third-party system is a decision each distributor needs to make based on clients’ needs. But one thing is for sure: Avoid the free tools out there.

“The best platforms cost money, like InkSoft, Antera, Order My Gear and ASI Company Stores,” says Mike Brugger, president of Fully Promoted. “You’re looking at probably about $50 to $100 a month per store, but it’s worth it. If you set up a free store for clients and now they want it to do more, like offering vouchers or having a flash sale, the answer will be no. Then you have to set them back up again on a paid platform anyway. You don’t know how clients will grow, so make sure the store has the bandwidth to support their needs.”

Stores should offer password protection and security, since clients will want to control what people are buying. It may be that only certain groups can buy certain items – say, different color polos for separate departments at a corporation. But it could also be more serious. “If it’s something like security guard uniforms, you need secure stores,” says Taraynn Lloyd of Edwards Garment. “You don’t want people running around with that uniform on who shouldn’t be wearing it.”

Sara Lavenduski is the senior editor for Advantages. Tweet: @SaraLav_ASI. Contact: slavenduski@asicentral.com