Friday, April 26, 2013

Mutual Respect

The importance of the relationship between local sales representatives and golf shop buyers and managers probably cannot be overstated. The potential for increased productivity on both sides of the table is often contingent on the value inherent in this partnership. What is also true as business tightens is that these relationships are stretched and/or terminated. It is human nature that as pressures, demands and expenses increase, nerves tend to fray and friendships are tested.

 Most reps are putting considerably more of their bottom line back in the business to stay on the road and to offset the cost of sample lines. Most buyers are being expected to do more with less not only with volume and margin but also in terms of ambience and most importantly service.

This has been explained to me lately by many of my colleagues and usually it is discussed in the context of “creating tension”. With this situation as the focus and “mutual respect” as the mantra I thought it would be interesting to listen to comments from some of the leaders in the industry on both sides of the table.

Our club is fortunate in that we have tremendous sales representatives who call on us to support their various companies. One of my internal wrestling matches as a shop owner is trying to separate the personal relationships we spend time cultivating, from the tough business decisions of what to stock season to season. The concept of "mutual respect" hinges around communicating to the sales rep those decisions. We currently have a rep that we've done significant business with the last 3 years, only to change directions this spring, The rep was (understandably) extremely surprised and disappointed with our decision. However, I made it a point to contact and discuss our reasons with them about needing variety. Without diversity, product lines carried too many years in a row become stale both in style and to our customers. I also expressed the multitude of alternative opportunities such as tee gifts, promotions and special events that can move the needle with the vendor outside of a seasonal buy. Fortunately our relationship is built on a "mutual respect", and the communication lines neutralized the conflict or tension.

Adrian Jolliffe, PGA - Head Professional - Cascade Hills CC - Grand Rapids, MI 

Coming from a background as a PGA Professional, I understand that our customers have many more responsibilities than retail. Taking that into consideration as a vendor by providing service and support throughout the season is something that is essential in our business. That effort of understanding your customer's business, and the golf professional understanding the rep's side of the business is most beneficial and creates "mutual respect". It is a partnership, as you and I have discussed in the past.

Brendan McHugh, PGA - Account Executive - Summit Golf Brands

It is impossible to completely understand one's position without a certain amount of information being exchanged between buyer and sales rep that often times leads to the creation of a bond transcending the business relationship. As the dialogue moves from business to personal and friendships are created it's important to understand the difference to avoid conflict and confusion. As friends you might enjoy a round of golf together, go to a game, share dinners, etc., but as business associates it's very important to understand each other's needs/motivations and work together to create a mutually beneficial solution. You must also realize there will be times when your personal relationship may be strained due to business decisions made by either party. Respect and understanding will provide the foundation for future growth both personally and professionally.

Scott Stone - National Sales Manager - Golf - Ahead, Kate Lord, PGA Authentic

Craig: I hope you are well. I believe I have a relationship based on mutual respect with all of my vendors and sales representatives. While I certainly realize that they have a job to do and that their job is to "sell", I also understand that my job is to make the best business decisions possible in order to maintain proper margins and product mix. To that end, I have to decide which lines i'm going to carry from year to year. Some decisions are based on member comments. Most are based on what I feel will offer a good variety - product mix and price. Obviously it's not possible to carry every line, and I believe everyone's time is extremely valuable thus I don't waste my time, or the rep's time, looking at a line that I have no interest in carrying. I feel honesty is the best policy.

Gene Mattare - General Manager, Director of Golf - Saucon Valley Country Club

You have to create a good relationship/partnership between buyers and reps to help make your business extremely successful. You have to work together as a team, not against each other. Each side needs to listen to the other and respect each other's opinions. You rely on your reps for product knowledge, upcoming promos, merchandising tips, etc....
At the end of the day, everyone needs to lower their egos and realize that whether you are a rep or a buyer that you are servicing the member's needs and building a level of service that keeps your members coming back to your pro shop time and time again. Create meaningful relationships with each other and treat each other like you do your members on a daily basis. We are all in this together.

Shelley Puffer - Houston Country Club

Thanks for your message and opportunity to comment. Communication and understanding of the relationship are the key components to developing and maintaining a mutual respect between sales representatives and golf shop management. It is important to have an understanding throughout the relationship as to the goals, objectives, priorities and expectations of the merchandising operation so each side can be respectful of time, costs and commitment. the sales representative and golf professional management staff each showing a knowledge of business practices along with consistency of contact will be mutually beneficial and insure a lasting relationship.

Phil Owenby, PGA - Director of Operations - Kinloch Golf Club

While it may be impossible to completely avoid tension when conducting business,understanding the meaning of the word partnership by both buyer and seller is critical. My accounts are business partners (and often friends) not just customers or sales prospects. As a territory representative I strive to cultivate relationships that leave no doubt that I understand the challenges and goals of my partners and always will do what is in their best interests. Those who understand and value this approach have partnered with me for the common goal of growing our business. This type of relationship is built on clear communication and is the cornerstone of mutual respect. It goes a long way toward eliminating the tension that sometimes "comes with the territory" and makes it possible for all of us to face the challenges that each day brings.

Jim Guerra - Territory Sales Representative - Dunning Golf, Greg Norman Collection, American Needle, Winston Collection

Thanks for the opportunity to comment on what is the key component to both buyer and sellers success. Mutual respect is created when our customers feel strongly enough about us to share their goals and plans. Knowing the expectations of our customers creates a frame work to better service them. Having this knowledge allows both parties to work together buying, selling, merchandising and promoting a product to deliver a desired result. True partnerships develop when you can be open and honest with your customers avoiding possible tension and disappointment.

Jim Glass - National Sales Manager - Dunning Golf

As an owner of a relatively new golf company, I spend a good portion of my time working with our sales force and customer base.  Frequently, I get to hear both sides of the relationship between the buyer and seller in our industry.  I am not sure if the real issue is “mutual respect.” One of the best parts of this business is the mutual respect that we have for each other.  I believe that the real issue is time management.  It is a key component to any business relationship in which mutual respect is fostered.  In the day and age of multi-tasking, rising costs and demanding retail pressures, we need each other.  But we need each other to be more organized with the follow up after presentation(s)/meetings.  We need to be using more sales data, developing more effective ways to present product, using more digital photos, etc. I know I am not alone when I say, there are at least 5 ways in which I can be a better partner in this business that we are building together.  I am hoping that all of us might feel the same way.

Sharon Sunoo – Owner, Birdy & Grace

Since I am the one that begged Craig to write on this subject, I want to focus on the tension. It is much more apparent than I have ever seen it in my career and is definitely not productive. We have lost a lot of the fun and camaraderie that used to permeate our industry.
One of the most contentious subjects I have witnessed lately, through conversations with my peers and personal experiences involves "Trunk Shows". There are tales of reps spending half their day to sell two shirts, or two pairs of shoes at a trunk show. A bad trunk show is expensive to host and expensive to attend. The relationship then becomes strained between the rep's and the shop manager's embarrassment. The business model is often flawed and "trunk show" should be removed from our vernacular. We should be calling these "Club Events" and the reps should be an added feature, not the show! There is not one brand in our industry that alone can motivate a crowd to show up and spend money at a club.
A "Club Event" needs to be special, well coordinated and a heavily promoted collaboration between the club and the vendors involved to draw as many members and guests as possible. This increases the chance the chance for a profitable day for the club and the rep, and a memorable experience the membership and their guests.

John Brisbane - Mfr rep in Texas and Oklahoma

To John Brisbane’s point there is grist here for further discussion. Please leave comments below particularly in regards to opinions you have on vendor/shop partnerships and extracurricular activity such as trunk shows.
My personal feeling on the “trunk show” at a club is that it is a numbers game and the audience and attraction needs to be large enough for the event to be a win/win. Often in the past I have made sure that everyone at the club that is invited understands that it is desired that they bring guests, family, friends, coworkers, etc., it tends to give the event a member/guest atmosphere.

Sunday, April 21, 2013

Word of Mouth - The Defining Criteria of Exemplary Service

I am often asked what I believe defines exemplary customer service and my response is always that it doesn't matter what I define it as – what matters is does the customer want to brag about their experience. There is no more valuable advertising than word of mouth advertising and now with social media the field is obviously expanded.  People believe what their family, friends and neighbors say about your club or facility, and they remember it for a long time. It is also true that very few people will complain – to you. They simply take their business elsewhere. Your golf operation generates word of mouth advertising, whether you are aware of it or not. Satisfied customers tell 4 to 5 people of their positive experience and dissatisfied customers tell 9 to 12. So the question is, what people are saying after the experience your product provides?

The basis of all positive word of mouth advertising is providing excellent products and services. This is also the basis for success of most marketing and advertising. Loyal customers will notice and read your ads or marketing efforts and become even more effective ambassadors as these advertisements act as positive reminders of your great products and services. Recent studies show that this is particularly true among the 20-30 demographic, a group that’s notoriously suspicious of advertising and well aware of the proliferation of fake positive (and negative) reviews as well. This group obviously is also  the future of the game. Superior products and exemplary service, combined with ongoing marketing and advertising, are the ideal keys to success. 

The story I often tell as an example of word of mouth ambassadors I call the "Philadelphia Story": 

I was in the Philadelphia airport several years ago and I was wearing a Kinloch Golf Club logo. A man I had never seen before approached me, half-gestured at the logo and asked me if I was a member. I replied that I was not but had the pleasure of working with the staff, particularly in the shop. The fellow introduced himself and began his "Then you will appreciate what I am about to tell you" story. 

I was in Richmond recently on business I played there with a member and can’t wait to go back.

It’s a great course isn’t it, I said.

Yes, it is – but the whole experience was incredible. I drove to the course and when we first went in the shop the head pro introduced himself; shook our hands and asked me if I wanted my car detailed while we played. The staff at the front door had already valeted the car and had the keys, all I had to do was say yes and I did. When we finished for the day my car was waiting at the front door, bags loaded, staff thanking us for being there. It was a hot July day and two things that struck me when we got in the car was that the car hadn’t been this clean since I bought it and there were cold bottles of water in the console with a ‘Thank you for spending your day with us’ note. I drove the car about 50 feet in the driveway, re-parked and went into to the Pro Shop to thank someone for the thoughtfulness. I ended up buying $500 worth of shirts and shorts and the friends that I had played with did the same. The shop was great also by the way.

The point of this story is that you never know what will be the Wow Factor. The devil is most definitely in the details and it is more often than not the small thing that ends up counting the most. I tell this story often to head pros that complain about their staff and budget cuts. It was the cold water, the note and the thoughtfulness, not the detailing (which they paid for) which created this word of mouth emissary. A bottle of water costs about 89 cents and the note takes less than a minute to write. Most facilities fulfil their customer’s expectations but people will talk about you if you surpass their expectations. Do the few extra things, and you will have loyal players that recommend you to their friends, neighbours, family, church members, and people they don’t know in airports. You want the underlying philosophy of your culture to be that any visit that does not provide such a story and the desire to tell it to someone is a missed opportunity.

Every customer is not profitable or even desirable; some people have unrealistic expectations, and will not be happy no matter what. This is true in every business. One of the beauties of the golf business and an aspect I like to refer to as The Intimacy Factor is that these people are easy to identify in golf and need not be paid much attention to until an effort has been made to wow them over.

Regular customers, on the other hand, that become unhappy actually have the potential to be your best advocates. As Zig Ziglar points out, "Statistics suggest that when customers complain, business owners and managers ought to get excited about it. The complaining customer represents a huge opportunity for more business."

When you resolve problems to the satisfaction of these customers, they will become your loyal, staunch supporters, and they will spread positive word of mouth advertising for you.  It’s human nature. We respect people that admit mistakes, and correct the situation. We give them the benefit of the doubt in the future, and we tell others that they fix their mistakes and keep their promises. It leads to great customer loyalty. If you really want to stand out, go in search of the unhappy customer that never complained. If you really want people to say great things about you, find and fix the problems that the customer didn’t identify. Ask for feedback from your customers, and follow up. You will win customers and friends; and they will actively influence other people with their positive recommendations about your facility.

Finally, take the time and give careful thought to taking care of your ambassadors and remember it doesn't hurt to ask for references. Give additional discounts for each reference, a free service, special treatment, and don't forget the occasional gift to better customers. People will recommend you if they believe in you and your staff, and a little perk always help remind them to tell the story.

Friday, April 5, 2013

Custom Branding

Every golf shop owner and staff at some point in time has considered developing a "private label" brand. If one were to get out the legal pad and list the pluses and minuses, the pluses - margin, uniqueness of product, marketing of the facility, etc. certainly outweigh the negatives. The one big negative that is the elephant in the room however is the stigma that "private label" brands have historically been perceived as inexpensive, low quality goods. The only other caveat that could be viewed as a negative is that while some golf apparel brands do sell themselves, custom branded apparel would need to be sold at least initially, and then perform well enough to sell itself.

I thought it would be great to examine custom branding in this forum with probably its most articulate spokesman and one of the true gentlemen in the golf apparel business – Mark Killeen.  Mark is the CEO of Full Turn Direct and he has formed a Pro Staff Advisory Board who will participate in this discussion. The board consists of the following:

Greg Lecker – Sawgrass Country Club
Shim LaGoy – Orinda Country Club
Nick Papadakes – Old Elm Club
Matthew Hall – Turtle Bay Resort
Dow Finsterwald, Jr. – Colonial Country Club
Nick Wolfe – Waynesborough Country Club

Mark, before we talk about product, margin and marketing tell us if you will about the history of deciding to pursue this niche of the business.

First Craig, it is a pleasure speaking to you as always and thanks for the opportunity to do so. The genesis of our business is really quite simple. Golf shops sell apparel that is adorned with their embroidered logo. If you ask most shops, they will tell you that if they removed their logo, the product would not sell. Their members, guests and customers are telling golf retailers every day that the compelling reason the purchase decision is made in their shops is because of the clubs own brand.

Product differentiation is a core competency of every good retailer today. Across the entire retail spectrum, retailers are sourcing product that reduces competition. Custom branded product is how most retailers execute this strategy. We saw very early on that there was a huge void in the specialty and golf market for a company to offer product that offers the retailer differentiation.

Let’s get the elephant out of the room. I know the Full Turn Direct product line well enough and long enough to know that only the highest quality products are being sourced.

I understand the elephant and unfortunately the perception has been a reality in the golf market in the past. We approach the concept with a product first strategy, not a price first strategy. We take the responsibility of customizing every garment with our customers branding very seriously. Our products must be commensurate with the brand value of our customer. The bar is set high in golf, particularly with our customers.

As an example, we use only SUPIMA registered cotton in our luxury shirts. This raw material is less than one half of one percent of all cotton grown in the world. Our performance shirts are equally impressive as we have chosen to use a unique process of infusing the micro poly yarns with charcoal from bamboo which we call Eco Tec. The charcoal keeps the shirts odor free and the bamboo moves moisture very quickly. As you know, most companies use a chemical coating on their polyester shirts and those coatings can wash out very quickly. That is why you hear the complaint of performance shirts holding odor. That never happens with our EcoTec.

We also take a collection approach to our merchandising, which is not easy to accomplish when we are customizing every garment. The old concept of “private label” was to offer a series of solids and basic stripes. We believe our customer’s own brand value demands so much more and we give it to them! The line consists of some of the finest cashmere sweaters and accessories available, ultra-fine micron Merino sweaters and knits, classic Supima golf sweaters, quilted micro poly windwear and a country club short program. To further the knit classification, we also offer special fabrics every season. For Fall 2013 we developed a very unique luxury garment that also performs naturally. Our LuxSpun golf shirt is a blend of the new micro-TENCEL for easy care and Supima cotton for the luxury hand feel. We then plated the fabric in pure white Mulberry silk which is naturally anti-microbial. This is one hell of a golf shirt!

Dow Finsterwald noted, the overall quality of the golf shop sends a message to the customer. Our great brands at Colonial help our Custom brand and our Custom Brand helps our brands. What I like best is the fact that my shop is the only place our members or guests can find our custom collection. Now, our own brand is being asked for regularly by our customers.

Greg Lecker – As for quality, the Full Turn EcoTec is the only shirt my staff can wear and I don’t have to open the windows for staff meetings! It is a great shirt that really works. It is amazing.

Obviously the margin and the flexibility to promote that extra margin provide the most important aspect of developing custom branded product in the shop.

The margin conversation is a very interesting topic. In the early months of our company, we spoke of margin and the value of margin at length. Many customers found that emphasis objectionable as they felt the priority was margin, not the quality of the garment. That was certainly never the case. I guess in a way we were taking the quality issue for granted. Today, we let our customers discover the margin opportunities. There are certainly times when we review the comprehension of the margin equation and highlight the value we offer with complete shipments, no substitutions and of course how we can help reduce the shops competition. After all, it is not the initial margin that counts, it is the maintained margin at the end of the season.

Matt Hall – COGS on hard goods keep going up and that is putting more pressure on me to improve my soft goods margin. Custom Branding is how I have been able to accomplish a meaningful improvement in profitability.

Nick Papadakes - I am a margins junkie, primarily because of the way I was trained as a young pro.  When I first started here we had miserable margins; sales were decent but the profit was very low.  By restructuring the buying plan to offer products like those from Full Turn, that could maintain and hopefully increase sales, we were able to better our margins by over 15%. 

Another way to look at margins is that we have more dollars for promotions while maintaining profitability. With the off course big box stores and discounters full of branded product at low prices promotions are here to stay.

Shim LaGoy – I can offer more value when promoting my custom apparel, because I don’t have to compete with the $19.99 shirt at the sporting goods stores.

I have used hang-tags in some interesting ways depending on the facility and what is most relevant to be marketing to the consumer.

We take the same strategy with our branding trim as we do with the product itself. Hangtags are customized including full color photography and we use the finest damask woven labels. On performance products, we are now using a heat seal label application that has become very popular.

Nick Wolfe – We have changed our hangtag every couple of years to keep our presentation fresh. Our members now look to our custom collection as ‘their” collection. We have developed a real following of our members.

Shim LaGoy – The great thing about our custom collection is it immediately generated conversation between our staff and members. Now, there is a real sense of pride in carrying our own custom shirts and sweaters.

Nick Papadakes – We are using our custom collection exclusively to celebrate our centennial. It is very exciting to know that such a special event logo will appear only on our own shirts.

Custom branded product is by definition a differentiator but I think it’s important to talk about how it has evolved in other retail channels.

Well custom branding certainly has evolved in every market segment and in almost every product category. As the products offered have improved, so have the sales results. Today, custom branded products are driving not only profitability, but sales volume in retailers at the top end of the market like Nordstrom and Saks as well as the mass marketers like Costco. The real lesson here is that when done correctly, the consumer responds very favorably to custom branded products, which in turn means the retailer becomes more successful.

I have been asked many times why we started this business and I often refer to a business failure of mine. Years ago I was part of a team that built a multimillion dollar branded business with Nordstrom. We were fortunate as well to build similar businesses with Macy’s and Robinsons in the same market. Despite successful sales, my business with Nordstrom started to decline. They would politely mention that it was difficult for them to grow the business with me while I was growing the business with their competitors who were more promotional. Eventually, Nordstrom stopped buying completely. I will never forget the merchandise manager saying to me, “We just don’t think it is a good business strategy to allow our competition to determine our profitability.” He was right and golf shops today need to be very aware of the competitive pressure on them as well.

Golf shops have a very unique opportunity as each one already has a valuable brand. In almost every case, I can assure the Club Professional or Club Merchandiser that their brand value is greater than they think. Are some club brands greater than others, for sure, but that does not mean they all can’t benefit from a great focus on their own brand…they can and more and more clubs are doing it every day. We are very grateful for the opportunity to assist along the way.

If your staff enjoys and is properly trained to engage customers in conversation about your inventory as opposed to the "hang it and hope" modus operandi then you can do well with custom branding from Full Turn Direct. The Supima cotton and EcoTec stories are great fabrication stories to be able to tell and Mark continues to upgrade the line, always looking for the newest and best and developing his own.

The hang-tag on apparel is a valuable marketing space and I have worked with Mark, his wife Rollie and their staff to design them to market what was most relevant to the facility's business from tournaments, outings and corporate sales to real estate. The ability to use the suggested retail - give something of value away as promotion - and still make full retail margin is a true competitive edge in today's marketplace.

I have spoken at the Full Turn Direct sales meeting and spent time with the reps. They are accommodating and want your efforts in custom branding to be successful. The banner to the right will take you to the web-site and I'm sure Mark or any member of the staff would be good conversation if you are considering this avenue as a way to improve business.