The biggest mistake distributors make when selling promotional products is trying to work with 5,000 suppliers and 750,000 products, Kilburn says. "They want to be able to offer anything and everything rather than learning the trade by specialization," she says. "Distributors need to understand who their clients are and how they use advertising, then chose 10 to 20 lines that carry products applicable to those marketplaces."
Another common mistake is offering deep discounts in order to get in a client's door. "Because forms distributors have worked with lower margins, they'll bring the price of the promotional products down," Kilburn says. "Soon it becomes a price war and the distributor isn't paid for the time it takes to research, develop and present the product." Once end users become accustomed to low prices, distributors will not be able to increase them, she says.
When entering the market, Kilburn recommends distributors study several of their top clients in order to better understand their businesses, customers and advertising needs. Distributors then can select promotional products that specifically target those issues. "Rather than going into a client and saying, 'I can offer you 750,000 items,' you can present three or four targeted products," she says. When distributors sell in this manner, price becomes less of an issue, she says.
Kilburn also recommends distributors enter the market by selling promotional products as add-ons. "If you're currently printing a company's employee relations manual, you can add a ring binder, a portfolio, or a calendar with goals and events listed on it," she says. After the sale is complete, distributors then can target other departments within the company.
--Kara S. Carpenter
Sales Drivers
Distributors can increase their sales volumes with promotional products.
Businesses spent approximately $16.6 billion on promotional products in 2001, according to Promotional Products Association International (PPAI). "It's a cost-effective advertising medium," says Mary J. Kilburn, principal of DinoMar Inc., a 25-year-old consulting firm in Golden, Colo., that specializes in helping distributors enter the promotional products market. "It's one of the most targeted forms of advertising, and you can easily track its success."
Promotional products can stimulate new business, ensure customer loyalty and reward employees for achievements. They're natural sales additions for forms distributors, Kilburn says. Promotional products offer median gross profit margins of 38 percent and many sales are brokered--just like forms sales, she says. "Promotional products are very cost-effective for smaller businesses," she says, "and many forms distributors we work with already are working with small clients. That's a very good market entrance because there's already an established personal relationship. Small businesses often prefer to buy from other small businesses."
Entering the promotional products market doesn't require a major investment, Kilburn says. Most suppliers provide distributors with marketing materials and--since it's a brokered business--distributors don't have high inventory costs. "It's a fairly low-end entrance to the market with very high-end returns," she says.
With sales topping $4.8 billion in 2001, apparel items are the top-selling promotional products, according to Promotional Products Association International. Courtesy of American Image, Houston
Calculators, Clocks, Stress Relievers, Computer Products, Writing Instruments
Prime Resources Corp., Bridgeport, Conn., introduced its 2003 2-in-1 product catalog with more than 440 products. The front of the catalog features the company's product line of more than 150 items, including calculators, clocks, stress relievers, computer products, clip dispensers and more. The reverse features its new line of writing instruments, including more than 40 pens in ultra-modern to classic styles. To ease use, the catalog has fewer items listed on each page than previous catalogs. Call (203) 331-9100 or visit www.primeworld.com.
Memo Boards, Patriotic Sticker Sheets, Oval Bumper Strips, Mouse Pads
Gill Studios™ Inc., Shawnee Mission, Kan., introduced its "Gallery of Specials" first-quarter specials. Through March 31, the company offers discounts of up to 42 percent on its magnetic memo boards, patriotic sticker sheets and oval bumper strips. Also, customers who order 250 or more Max R. Scharf subliminated mouse pads receive a free Max R. Scharf-signed "Rocky Mountain National Park" fine-art litho. Call (913) 888-4422 or (800) 392-4455 (fax). Visit www.gill-line.com.
Lanyards, Friendship Bracelets, Luggage Straps, Pet Leashes, Printed Shoelaces
Marathon Prestige, Dexter, Mich., offers lanyards, friendship bracelets, luggage straps, pet leashes, printed shoelaces, miniature dart sets, boxer shorts, hospital bands, pillow cases, beach towels, bandannas, embroidered socks and more. Call (800) 521-2860 or (734) 426-3644 (fax). Send email to prestigels@aol.com.
