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Is In-House Decorating Worth It?

Wearables Sales Forecast 2013
By Sara Lavenduski

Increasing PopularityApparel distributors are eschewing in-house decoration, citing everything from the rising costs of overhead (including payroll, machine investments, equipment maintenance and facility bills), as well as the challenges of remaining competitive during an uncertain economy. Is that the right decision for your business?

Proforma Communications Group (asi/300094), founded 11 years ago, was established without in-house decoration capabilities. "It's about the cost," says Brian Dinley, executive vice president of operations at the Delray Beach, FL, company. "The machines are expensive and it's difficult to stay competitive with the changing trends."

Jeff Holt, vice president of marketing at Image Source (asi/230121) in Kirkland, WA, says they too decided to forgo decoration capabilities from the get-go, and instead rely on their decorator partners to be experts in the different techniques. The primary reason for contracting the work out is the overhead required for space, machinery and additional staff. "It just doesn't add up for us," says Holt. "We'd rather focus on selling and have our great partners concentrate on the decoration."

Dinley echoes the same sentiment, and lauds his company's strategy of working with local companies who specialize in different methods and offer good products at competitive prices. He says it allows them to focus on selling in multiple merchandise categories, instead of being limited by the concentration on expensive equipment and machines. "The client doesn't care where the decoration is done, as long as it's done correctly," he adds. "So why tie up the capital?"

But doing without in-house decoration is not an open-and-shut case. Tej Shah says offering in-house decoration has proved quite lucrative for Overture Premiums & Promotions (asi/288473) in Vernon Hills, IL, which offers screen printing, embroidery, heat transfers and digital garment printing. "We control the final step of the product supply chain process," explains Shah, vice president of marketing and e-commerce. "Because we have it in-house, we have control over the quality and we can scale it up and down."

Shah cites as an example a recent order for 125,000 screen printed tees. Overture was able to scale up and add second and third shifts to make sure the shirts were finished on time. "Sub-contractors will only go so far for you," he says. "We offer product quality control; flexibility, particularly in turnaround times; and cost control because we eliminate the middle man."

To successfully start with in-house decoration, or add it to an existing business, distributors should determine the focus points of their operation, whether that includes product sales, decoration sales or both, and how to commit to them while remaining conscious of finances.

While distributors like Proforma Communications Group and Image Source have decided to concentrate mainly on the product selling end, Overture Premiums & Promotions has struck a balance between the merchandise and decoration sides. Ultimately, the decision to offer in-house decorating or not comes down to the cost factor. "Decoration is a value-added benefit for our clients," says Shah. "We can say, hey, most distributors will outsource or sub-contract the work, but we do it all in-house. Here are the advantages of that."

Deciding Against Decoration

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