Connect with us

Business & Industry



Times are tough. Business is slow, and the recession is taking longer to reverse than any of us ever expected. In some segments of our industry, there have been signs of optimism, but the improvements seem to have had no momentum and, in some markets, have sputtered out entirely.

It’s times like this, when business is slow, that are perfect for making sure you are protecting your company for the future. When your market is down is the ideal time to plan how you can do things better and make sure that your business is still around to take advantage of the next boom.

Whenever the economy suffers a downturn, the screen-printing industry always gets shaken up. One effect is that many companies go out of business because of lost sales. At the same time, we see many new startups come into the in-dustry because of the low cost of entry. Due to poor planning and market research, many of them fail.

Economic downturns release a lot of talent into the labor pool and more importantly, the entrepreneurial market. People skilled in other disciplines who have been ousted from jobs due to downsizing or otherwise left unemployed decide that screen printing looks like a great way to start a business. Some of these people have a lot of solid business-management experience. Others have precious little business knowledge. A few can’t even claim to have common sense.

Screen printing attracts these people for several reasons. From the outside it looks fun. It’s relatively inexpensive to start a screen shop compared to most other business ventures—for a rather modest sum of money, you can be up and running. Few businesses (with the possible exception of lawn-care or pool-maintenance companies) have a lower cost of entry.

The segment of our industry that sees the biggest influx of these new businesses is, and always has been, the garment-printing segment. Infected with entrepreneurial spirit, the founders of these businesses decide, “Anybody can print T-shirts…I’ll bet I can make a bunch of money doing that!” Little do they know that garment screen-printing companies fail almost as often as new restaurants.

You can learn some valuable lessons to keep your own business successful by understanding where failed businesses usually fall short. When you assess their mistakes, you’ll find that they generally occur because the company didn’t adhere to some very basic business principles. This article identifies the top ten of these principles:

 1. Never be content with your market.

 2. Never take customers for granted.

 3. Never make decisions based on rumors.

 4. Never take orders at a loss.

 5. Never expand production capabilities without thorough research.

 6. Never expand your product line without thorough research.

 7. Look everywhere for new opportunities.

 8. Always play the part of salesperson.

 9. Always listen.

  10. Remember your best asset— your staff.

Although several of these concepts may seem to represent simple common sense, the fact that they are so frequently overlooked makes them worth exploring. By taking these principles to heart, you’ll put your business in a much better position to survive economic downturns now and in the future.


Never be content with your market

Of all the principles presented here, this is the one that should be the foundation of your business strategy. As a business owner or manager, you cannot afford to be satisfied with your market or the position of your company in that market. Larger companies can afford to have teams of managers who continually look ahead, scouring for new opportunities and competitive threats, while in a smaller business this responsibility generally falls on the owner.

Regardless of who’s in charge, constantly keeping watch for changes in the market is a function that cannot be ignored. Otherwise, you may find out the hard way, watching orders dwindle as a more visionary competitor down the street discovers a way to offer faster turnaround, a better price, or some other advantage that attracts your customers.

This doesn’t mean that you continually have to buy new equipment whenever the competition does. What it means is that you must always strive to offer more—more service, more quality, more of what the customer wants—in order to keep that customer’s business. In some cases, new equipment may be required, but in others the solution may be to modify procedures, add a simple service, use different materials to provide a better product, or make similar changes.

As a technical sales representative, I talk to thousands of people in our industry every year. I categorize them by their attitudes toward market evaluation, which largely determine how likely their businesses are to survive:

The “I have always done it this way and I am not about to change now” printer This guy probably won’t be around long…unless he is the only printer in town.

The “we wait until our customers tell us what they want” printer This guy is a day late to the party. He may stay in business, but he will never be a big player in his market. It is impossible to be in front when you are always playing catch-up.

The “what have you got that is new” printer This type of printer has a much better approach than the previous two. The printer has a positive attitude and is interested in finding new ideas that might give him an edge. But he’s probably not top dog in his market because he waits for others to point out things that could improve his business—he doesn’t actively seek out these opportunities himself.

The “I need a supplier who could give me…” printer This printer knows what he wants because he’s already given his plans careful consideration. When a customer like this pushes the supplier to deliver something beneficial, and at the same time listens to what the supplier has to say, he is primed for success.

This last group of printers are the survivors. They know what it takes to get ahead and keep their company moving. I would be willing to bet that most of them are conducting business today much differently than they did ten years ago. They are constantly coming up with new products, new ways to manufacturer, new ways to sell, and other new ways to improve their businesses.


Never take customers for granted

Everyone in this business faces the occasional “customers from hell.” And everyone is glad when they go away. What this principle applies to is the typical “good” customer, those who bring work to your business and don’t bicker about the price every time they walk in the door. These are the customers that pay on time and genuinely enjoy doing business with your organization. What? You don’t have any customers like that? Then you really need to read on.

Without customers, a business is nothing. They are the single most important thing that a business must have in order to grow. Years ago, nurturing customer relationships was a lot easier than it is today. Blame it on pricing competition, the pace of modern life, or poor communication, but today it is much more difficult to treat every customer as king and win the kind of loyalty you once did.

Of course, this is not to say that you should now treat customers like you were selling them fast food. You never know when an average customer will turn into a gem, so it’s in your best interest to look out for the customer’s best interest. Going the extra mile when a customer is in a real bind can raise your relationship with the customer to the next level and lead to more business for your company.

Respect for customers will not always pay dividends, but it is much too important to make any assumptions about who to treat well and who to ignore. By treating them all as if they are the only customer you have, you greatly improve the odds of success.


Never make decisions based on rumors

Screen printing is no different than any other business when it comes to rumors. They run thick most of the time, and even thicker when business is slow.

Rumors can be destructive. Both the rumors that you hear coming from outside your business and those that circulate inside can distract you and your staff from real job duties. The most unproductive workers in the world are the ones that are constantly worried about their future because of some rumor they heard.

It is hard to ignore the rumor mill. We are all interested in what’s going on with our competition and customers. The important thing is to put the information into perspective and not let it run your business or your life. Teaching your staff the same restraint makes for a healthier, more productive workplace.


Never take orders at a loss

Take this principle with a grain of salt. No one runs a business with the intention of losing money. At times, it may be necessary to work for less than you want. But the key is to not make a habit of it. Accepting orders that don’t add to your bottom line should be an occasional exception. Don’t use these kinds of orders as an excuse to keep your shop busy.

Printers are often asked by their customers for pricing favors. The question is, how fast should you hold to your pricing policies? In some instances, you might be justified in discounting more heavily than normal in order to keep the customer and get more lucrative jobs in the future. The best approach is to weigh the cost of possibly losing that customer against the loss you would face by accepting the low-priced order. In general, keep these special pricing arrangements to a minimum. Don’t take work at a loss, but be flexible enough to realize when making less now could mean a greater payback in the future.


Never expand production capabilities without thorough research

The biggest mistakes in business are often those that occur when an idea is implemented without thorough research. These mistakes occur when you buy a machine without finding out if you have the order volume to keep it busy or when you buy a large quantity of substrate in the hope that enough orders will materialize to use it. Many businesses make the mistake of expanding their capabilities without adequate research, which is why you see so much barely-used printing equipment up for sale.

Determining what the market needs and what it will pay are essential ingredients for a successful expansion plan. While it is difficult to fully anticipate the precise degree of demand and need, your research should seek to justify that the demand is significant enough to warrant your planned expansion.

You also need to conduct a thorough financial analysis that predicts both the best- and worst-case scenarios. If expanded capabilities only add profit to your bottom line at the best possible sales level, then it may be too early to proceed with the expansion. But if the numbers look good even at a much reduced sales level, the expansion is probably a smart move.


Never expand your product line without thorough research

While it’s important to expand your production capabilities and the range of services you offer, it’s equally important to expand your product line. Companies that stay ahead of the curve and bring new and innovative products to market first tend to be the ones that remain in business the longest. Again, the key is research to determine if the size of the market and the potential demand for the product justifies adding the new item.

The research required to keep ahead in the product-development game should be an ongoing effort, regardless of the size of your business. Companies that keep doing the same thing and providing the same products year after year are businesses that become statistics. Product innovation must be a passion for any company that wants to be successful. If you don’t keep pushing your products forward, the competition will move ahead and leave you in the dust.


Look everywhere for new opportunities

Part of researching new product ideas is to make sure that you do not limit your options. If you print T-shirts, don’t just think about new designs and imaging techniques you can add to your offerings, think about products beyond garments that you are equipped to produce and that your customer base would support. The same is true if you print decals or any other type of product.

In the recent business downturn, many vendors in the screen-printing industry were shocked to discover how many of their customers in the CD-printing market had gone out of business. The narrow business focus of these companies meant they had no alternate revenue streams when the demand for CDs dropped.

For garment printers, the realm of additional products that might be suitable additions include such things as decorated mugs, sleeping bags, pillows, umbrellas, ad specialties, or even graphic products like signs and posters. Similarly, graphic shops might find applications for their equipment on products used in other markets. For example, a company that prints signage or P-O-P displays may find new business in producing decals, graphic overlays, or some other industrial products.


Always play the part of salesperson

I find it baffling that so many of the business owners I meet today say that they leave selling to their sales staff. Business owners are really the most important salespeople for their companies.

If you are a business owner, every customer or supplier you come into contact with will judge your business based on the way you present yourself and your company. Don’t miss the opportunity; use it to your advantage and sell both yourself and what your company has to offer. When the head of a screen-printing shop demonstrates complete familiarity with his or her business, its products and services, and its operational nuances, customers gain a sense of confidence and are more inclined to do business with that company.


Always listen

Listening is quickly becoming a lost art. Most people are so busy trying to voice opinions and explain their positions that they fail to take the time to listen.

Listening is one of the best ways to sell both your company and your product. By listening to customers, you begin to understand their objectives and can better provide the solutions they need. Good listeners are usually good at asking the right questions, too. When you want to know what someone needs, asking the proper questions can help to ensure that you get the most possible information out of the conversation. The shortest and least-effective conversations are the ones in which no one asks questions.

Most business owners and managers tend to do a better job of listening to prospective customers than to established ones. This situation can cause customers to turn elsewhere for their needs if they feel you no longer care. Listening is not only a great way to learn valuable information, it is also a way to demonstrate to customers that you are concerned about them and their orders.

Listening to suppliers is a good way to learn about future trends, what is going on in the market, and even what the competition is doing. When a vendor comes to call, don’t look at it as a nuisance, look at it as an opportunity to gain valuable information. If vendors usually just talk to purchasing personnel, make sure that they see whoever is in charge of research and development also. When a vendor rep gets the right piece of information, it could mean a breakthrough on a product or process for your business.

It isn’t often that we get a chance to listen to competitors, but the opportunities do arise from time to time. When they do, make sure that you don’t miss them. Mixers sponsored by your local chamber of commerce, trade shows, and participation in industry trade organizations all present good opportunities to speak with and listen to the competition. Sometimes, just picking up the phone and calling a competitor can be a worthwhile exercise that turns up valuable information for both companies.

For example, you’ve probably faced the problem of the customer who uses the competitor’s pricing as leverage to get better pricing from you. Sometimes the pricing numbers they throw at you just don’t make sense. That’s when it is time to call the competitor and clear the air. Such communication can often turn into a positive situation for both companies, especially when it reveals customers who are trying to play both sides.


Remember your best asset—your staff

This principle should be an easy one to master for every business owner, but un-fortunately it is not. You can determine very easily whether you are paying enough attention to your staff and their welfare—just look at your turnover rate. If you have a high turnover rate, then there is a problem that needs addressing. If you have a happy staff with low turn-over, then you already realize the benefits.

Stable work forces pay big dividends. They lead to lower training costs, lower worker compensation rates, lower insurance costs, and higher productivity levels. High turnover rates guarantee high costs, especially when you try to make up for the turnover by paying low wages. Substandard pay rates are a fact of life in our industry, but they are one of the major contributors to the turn-over rates in our workforce. For companies that use low wages as a means to save money, these savings are quickly lost through increased training costs, lower productivity levels, and higher insurance costs.

Several business journals publish annual lists of the best companies to work for. If you study these lists, you will see that most of the companies lead their respective industries in productivity and profit. Treating employees well can have just as great an impact on your own company.


Don’t be a statistic

During these tough economic times, take the opportunity to improve your business practices. It is much easier to work on the points discussed in this article when things are slow than to try and institute major changes when things get busy. Put these principles into practice now and they will be second nature to you and your staff when the orders start flowing freely again. 


Mike Ukena is a 22-year screen-printing veteran who has owned a textile-printing company and worked in technical services for the SGIA as the director of education. A member of the Academy of Screen Printing Technology, Ukena is a frequent speaker on technical and management topics at industry events. He is currently a technical-sales representative for Union Ink Co., Inc.

Editor’s note: This article was updated from a previous piece that appeared in the August 2002 edition of Screen Printing.



Most Popular