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Tuesday, October 30, 2007

A tale of two retailers

Here's a short tale, in two scenarios, of two local apparel retailers. Which one describes your story?

Scenario One

You close shop for the day.

1 You travel to Dallas.
2 You spend the day shopping supplier for the right item and price for your boutique.
3 Among your purchases: one dress at $50 to resell at $120, a 140% markup to yield a $90 profit.
4 Once back at your boutique you drive sales to recover your investment with a a profit.

If number 3 above before you count on that $90 profit take into account a day's closed shop, expenses (fuel and food, plus the $50 out-of-pocket) and number of days the dress is on the rack before it sells.

Scenario Two

You determine to have your dresses made locally:

1 You create your own dress pattern, or
2 You retain a contract service provider (independent contractor) to create your pattern you, or

3 You deliver the dress (whether from a thrift shop, mom's attic or discount store) to a skilled pattern-maker or seamstress who disassembles the dress and creates a pattern with whatever modifications you wish to include.

4 You make a choice of two or three different fabrics.

Leverage your tax-free, resell and discount purchase power on fabric buys. Different fabric choices allow for price choice. Additionally, because the finer the fabric the more challenging to work with you turn certain fabric jobs over to those individuals you know can handle it. You, and your other asemblers, can do quite well with the other fabric choices, still.

5 You retain a contract service provider (or do it yourself) to cut dresses segments for at-home assemblers.
6 At-home contractors assemble your dresses as you receive orders.

If you choose 2 or 3 above you compensate the individual upfront or agree to share sales profit percentage.
If you choose number 5 and compensate the assembler between $30 and $50. You may ask, "What have I saved by not shopping a supplier?"

The difference is you are not stockpliling inventory and you have a quick return on your investment because you have a customer need to fulfill.

You are able to offer the same supplier's dress for considerably less with a considerable profit margin in your accounts ledger, still.

You may also say, "A highly skilled, experienced dressmaker is not going to make a dress for that kind of money." You're right. So, don't go there. There are other highly skilled, experienced individuals who will assemble, in the comfort of their home, at their pace for that kind of money, not minimum wage or cash employees.

If number 6 consider your own local, regional, state and nationwide network of independent contractors. They are not your employees. It is more than a social "dressmakers club", but a source of income for the individual contractors as well as yourself, a pool in ever increasing numbers of others with the Knowledge, Skills and Experience anyone in the network may need to meet their contract expectations, and, yes, the priceless opportunity of an enviroment to interact with your peers.

We know where America's manufacturers have gone and they continue to turn to in the face of labor costs and operating expenses. Where do you go? Who do you turn to that will ensure not only that you survive, but thrive because you acted wisely together with others?

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