![]() |
![]() ![]() |
Home | Site Map | Buyer's Guide Search |
![]() |
Event Calendar | ![]() |
Article Archive | ![]() |
Message Boards | ![]() |
Classifieds | ![]() |
Product Showcases | ![]() |
News | ![]() |
Advertise | ![]() |
Search | ![]() |
Join Now | ![]() |
![]() |
![]()
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() Business 2.0: New Rules, Difficult Conversations, "Market Blur" and Digital Darwinism
By Chris Bernat, Partner, Vapor Apparel/Source Substrates
A recession does not slow things down, it accelerates the inevitable.
![]()
Do you remember Mel Gibson as "Mad Max" in "Beyond Thunderdome"? The movie's post-apocalyptic world had a gladiator-esque arena where conflicts were resolved. Max goes to the Underworld, where he befriends a convict who was imprisoned for trying to feed his kids. The rules of matches in the Thunderdome, as chanted by onlookers crowding the arena, are simple and singular: "Two men enter, one man leaves." It may be time to rent this movie again. If you thought last year was tough, you may want to adjust your perspective. There are plenty of people who would happily take last year's revenue numbers (at least for the first half of the year) instead of this year's. A "good quarter" in 2009 is staying even with last year and some people would be thankful to be only 20 percent down from last year. All industries are affected and each company has its own set of challenges. There are new rules now, but they are all driven by rule number one. Rule number one: Throw out the rule book. The market is making strategic and tactical adjustments on a daily basis. Are you? Are companies making adjustments in the way they work with you? The way products are made, ordered, paid for and used is changing. Nothing is free anymore and everyone is watching every dime. If you're a coffee drinker, do you find yourself sacrificing your morning Starbucks run more often? Many people are giving up these little pleasures and are erring toward the conservative. It is cool to be minimalistic. It is only natural that companies will make the same adjustments. There are plenty of examples. Here are a few:
These minor adjustments should have been made years ago. After all, who needs a $30 sign that they take down the minute their booth shows up? However, these examples pale in comparison to some of the difficult conversations happening in our industry every day. At a recent trade show in Fort Worth, Texas, all you had to do was grab a cup of coffee in the exhibitor's lounge to hear them for yourself. You didn't have to eavesdrop as the conversations are often direct and well above 65 decibels.
JIM: "I hear you are adding a new distributorship in my back yard?"
So what is driving all this behavior? Why are so many people looking over their shoulders at trade shows? Maybe it is "change," a word that has been used a lot lately. From politics to earnings statements, change is in air. Our industry is dealing with more than its fair share. But change has become almost meaningless from overuse. As business owners and directors we need to pinpoint the issues that we face, define their impact and take action. At the recent National Sporting Goods Association management conference, there was a workshop that really got to the meat of the issues that faces us all. The session, "Finding Clarity in a Blurred Market," was presented by the NPD Group, a nationally-accredited market research services firm. During the workshop, I quickly realized that almost all markets and sectors of the economy are dealing with "market blur." This happens when what we believe to be true about the market has changed. We are less able to identify threats and opportunities using traditional assumptions. This creates a blur effect that signals a need for a new model; one that will help us see new opportunities and threats more clearly.
![]()
The printing industry (both digital and analog) is clearly working through this process. There are enormous shifts in sales tactics, channel strategies and direct sales models. These changes will reset how our industry looks. You can already see it.
One afternoon last week, a distributor was having a conversation with one of its consumables vendors.
This is not unique to our industry. Many economists will quietly tell you that America is 33 percent over capacity. In other words, we have 33 percent too many restaurants, 33 percent too many automotive dealerships and 33 percent too many grocery stores. Most Americans understand overcapacity. Chrysler and General Motors just reduced their collective dealerships by almost 2,000, roughly 33 percent of total dealerships. That is the first of many examples of "right-sizing" you will see in our economy over the next few quarters and it could go on for years. So what does this mean to our industry? Do garment decorators really need two trade shows in Long Beach and two other shows in Fort Worth every year? Do we have 33 percent overcapacity in screen printing? Do 33 percent of the digital printing distributors need to shut their doors? Are there too many direct-to-garment vendors out there? I am sure we can find arguments for both sides. But one thing is certain, we are going to find out the answer very soon.
Darwin's Theory of Evolution has been applied to business situations many times. Forces apply their will through the natural selection of small, inherited variations that increase the individual business' ability to survive and compete. If 33 percent of everything is going to be gone, what does that mean for our market? In our version of the Thunderdome, perhaps it is: "Three men enter, two men leave." We are in for the ultimate in Digital Darwinism. With one-third the demand gone, consumers of equipment will be looking to determine the winner before they hop on board. We have already seen the demise of one major direct-to-garment platform. How do you prepare for it? How do you ensure your survival?
Our advice is simple: Don't focus on the unknown. Work on the things you know you can impact the most. By reducing expenses and focusing on growth areas, you are fighting not only the "good" fight, but the "right" fight as well. Chris Bernat is a Partner at Vapor Apparel/Source Substrates and has written about mass customization for a variety of industry publications. He previously served as Director of Sales for Sawgrass Technologies, after serving as both the Business Manager of the Sublimation Division and Large-Format Product Manager. He is a Clemson University graduate and lives in Charleston, South Carolina. chrisb@sourcesubstrates.com This article appeared in the SGIA Journal, 3rd Quarter 2009 Issue and is reprinted with permission. Copyright 2009 Specialty Graphic Imaging Association (www.sgia.org). All Rights Reserved.
|
![]() |
|
![]() |
|
![]() |
|
![]() | ||||||||||||
| ||||||||||||||||||
© Copyright 1999-2021, All Rights Reserved. |