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Point Counterpoint
By: Tom Vann and Larry Decker
Issue: 2007oct
The last thing either person in the distributor-decorator relationship wants is to end up in an argument. Yet points of contention—“You said you’d dropship the order for Monday delivery,” or “You never specified that on the purchase order!”—can quickly spiral out of control.
With a mutual understanding of each other’s needs and expectations, decorators and distributors can pull off orders with their relationship in tact. To illustrate this, PPB presented 10 common distributor-decorator scenarios to Tom Vann, president/CEO of Naperville, Illinois-based Target Graphics (UPIC: TARG0007), and Larry Decker, owner of Naperville, Illinois-based distributor AIA/Great Lakes. These veterans have worked out plenty of kinks along the way, gaining lots of valuable insight on how to nip potential problems in the bud.
SCENARIO 1
Distributor submits an incomplete purchase order.
Larry Decker: I have submitted incomplete purchase orders on purpose to get my order on the printer’s schedule or because my customer needed a few days to gather garment sizes or other specifications. Had I waited to submit the PO until I had all the information, it may have been too late for standard or even rush production.
I explain the situation to the printer’s customer service department so it can note the status on my PO: Order will be for 300 white t-shirts; art is in-house; blank garments to come from ABC Manufacturer. The rep updates my job file to alert staff down the line that shirts will be delivered within days, so it’s OK to move ahead with preproduction tasks.
Tom Vann: We don’t frown upon certain issues of incomplete orders. Still, there are certain things we can’t move without, such as the art. If a customer tells us the order will be 1,000 pieces but the sizes are unknown, the production manager can schedule the order. If we didn’t do this, the distributor wouldn’t make the client’s deadline. However, we do appreciate when distributors follow up with the remaining details instead of making us call them.
SCENARIO 2
Printer tells distributor the artwork sent by the end user is no good.
TV: If a distributor sends bad art, many times he’s in denial. Maybe the end user said the art was good, this distributor has a lot on his mind or perhaps he doesn’t want to deal with it. Whether the distributor hires a freelancer to fix the art or has us do it, he’s going to pay for it.
LD: Sometimes the client tells me the art is great, even though it’s not. Occasionally a distributor doesn’t have graphics software to open art files, so he takes a chance and blindly sends the files to the printer. But distributors should know and meet the decorator’s art requirements before submitting the order.
A printer’s graphics department can be a valuable resource because it can usually adjust or recreate the client’s artwork. Or distributors can hire a freelance artist to clean up or create graphics for an order. Either way, distributors will have to pass the art cost along to the end user or pay for it themselves.
SCENARIO 3
Art charges on a decorator’s invoice are higher than the estimate.
LD: The printer should stick to the estimate or notify the distributor prior to production if costs will be higher than estimated. If the printer later realizes the estimate was off, the original estimate should be honored because the distributor probably based the quote to the end buyer on the printer’s estimate. If the printer must charge more than estimated, the distributor should approve the additional charges.
TV: If we go over our estimate, we’ll stick to the quoted amount—with one exception. If we spend four to eight hours developing creative programs and a customer then requires a lot of revisions, we say up front this is expensive. This is not just “fix your logo” work. Then we’ll let the customer know that we will have to go over the quoted amount.
SCENARIO 4
Printer charges distributor for overruns.
TV: Because so much work in this industry is contracted out, many decorators supply product. But we’re not in a position to have overruns. A distributor is more likely to get under-runs because of inevitable spoilage.
Our spoilage rate is listed not only in our catalog but also on every quote. Some people don’t pay attention to this and are surprised when their order is 10 pieces short. They ask, “Why don’t you just pull a shirt from stock?” They don’t understand we don’t stock every SKU from every manufacturer.
The reality is that printing is not an exact science. If a distributor wants a true count with no shortages, additional product must be purchased.
Some distributors order extras and tell us, “Once you’ve printed 1,000, go ahead and stop.” Logistically, it’s difficult to stop in the middle of production. If they want an exact count and order extra, we print all the shirts and they get extra—and we don’t charge them for this.
LD: The overrun charge must be clearly stated in the printer’s catalog. If not, I either eat the overrun charges, or I pass them to the end buyer. This is bad because the customer doesn’t want to pay for more than what is needed. And it underscores the need for clearly stated pricing policies that are communicated to all parties, which protects everyone’s profits and minimizes the chance for surprises when the end user gets the invoice.
SCENARIO 5
Distributor calls decorator complaining that the end user received the wrong number of shirts.
LD: A quality decorator checks goods received from the manufacturer against the distributor’s PO. If there are discrepancies, a timely check-in should allow for corrections.
TV: When a decorator receives a shipment of garments from a manufacturer, all pieces should be counted and compared to the distributor’s PO, including brand, style, color and size. We require that distributors provide this information on POs because we cannot rely on packing slips from garment suppliers. If there are discrepancies, we have time to resolve the problem. Even with rush orders, decorators must check garments. If the shipment is wrong, at least we can tell the distributor before the client finds out.
SCENARIO 6
End user complains that a few shirts were poorly printed.
TV: Misprints are inevitable. If billed properly, most of the time a small percentage—usually between one to two percent misprinted—isn’t a problem. Sometimes, however, the end user must have each shirt accounted for, especially on small orders. Even if the distributor submitted a complete PO, indicating correct counts and allowable shortages, the end user still feels short-handed. Therefore, it is important for a distributor to ask the client if an exact count is needed. If so, extras can be ordered to allow for misprints.
LD: Good communication is essential so misprint polices are understood and the distributor orders the correct amount of extras to cover any mess-ups.
SCENARIO 7
Distributor complains that shipping charges were nearly double what the decorator quoted.
TV: We always state freight quotes as an approximate. Yet a variance this substantial would only occur if something else changed dramatically, such as the distributor doubling the order size. This said, distributors should realize freight charges change for a variety of reasons:
• New charges, such as inside delivery
• Incorrect address
• Weight changes
• Fuel surcharges
If we encountered a variance of 200 percent, we would rectify the situation.
LD: Some extra charges are legitimate. For instance, the distributor may not realize the end buyer doesn’t have a loading dock or room for a truck to turn around. But if an estimate is 200 percent off, there is a problem. It could be that the distributor gave the printer bad information that was provided by the end buyer. Or perhaps the printer entered wrong data into the freight calculator. Regardless, the responsible party should absorb the cost.
SCENARIO 8
Distributor calls with a reorder of 24 shirts. He insists on paying the same price he paid when he placed the original order of 1,200 shirts.
LD: I have had customers ask for such things, and I have had to educate them on how much time it takes to set up the job versus the actual run time on press because they may not understand the printing process. If the customer has any business sense, he or she will understand time equals money. It’s a distributor’s job to explain the process to the customer. I recommend that my customers order slightly more than they think they’ll need—not to increase the order volume but to avoid small reorders down the line.
TV: This is a reoccurring theme. The per-item cost to produce 24 shirts is much higher than printing 1,200. Even for a simple one-color job, if it takes 10 minutes to set up the order, and the hourly rate for the press is $125, then the hard cost to start the job is a minimum of $21. This cost amortizes at $0.88 for 24 shirts and $0.017 for 1,200 shirts. No mystery here: the 24-piece order costs more.
In the distributor’s defense, it is much easier to bill their clients for reorders at the original rate. However, this should be negotiated with the printer in advance because the expectation that the printer should charge the same price for a small reorder as was charged on the original, larger order is simply inconsiderate. The bottom line is the supplier can then decide to either bury some anticipated costs of reorders into the entire project or work out a higher but reasonable re-order rate that all agree to in advance.
SCENARIO 9
Distributor complains that the shipment arrived in damaged boxes, which looked as if they had been reused several times.
LD: First impressions are key, and because boxes are the first thing a customer sees, they must be in good shape. A good shipping/receiving employee should know when it is time to put a box out of commission. Also, I sometimes order new boxes with event-specific printing if the customer’s event warrants the cost.
TV: Like many decorators, we reuse the boxes the product arrives in. However, we replace boxes that have been damaged or are dirty. Beyond this, a decorator cannot control what a shipping company does to the boxes once they leave the printer’s facility.
SCENARIO 10
Distributor submits a reorder for a client. Previous productions of this order have looked great. This time, the distributor calls the decorator saying his client is complaining that the latest order was inferior to previous orders. Upon receiving a sample of current and past orders, the screen printer sees no difference in quality.
LD: When I know there is a possibility for reorders, I use the highest quality decorator to ensure consistent quality. But if a client is concerned about inconsistency, I ask to see the items to judge for myself.
I also tactfully ask the client if he or she personally thinks there is a problem, or if an end user in a different location thinks there is an issue. If it is a person at a different location, then I ask: Was the shirt examined in good light? Is the person familiar with the original design? Did the buyer request a lower-quality t-shirt on the reorder to save money?
In addition, I would also contact the printer to alert him or her of a possible quality issue. Perhaps something did happen on press. The key here is to let the end user know that you are addressing the situation from every angle.
If after comparing the latest order to previous ones I realize there is a loss of quality, then I send an example to the printer for verification that there is a noticeable difference. A good printer will rerun the job at his or her expense.
If I don’t think there is a problem with the printer, I tell the client I addressed the situation from all angles and that I, too, am concerned with consistency. The customer should understand that perhaps the image was overanalyzed.
TV: I admit we have wavered on a reorder, albeit rarely. With such cases, we replace the product. In an extreme situation like this, I give the distributor the benefit of the doubt. If my comparison showed no obvious deviation, I would scan the original and reorder pieces to show the distributor the prints are consistent.
We preface this with a simple question to the distributor: Have you compared the product yourself, or are you going on your client’s word? Many times, the distributor is reacting to a client’s claim sight unseen. I would then educate the distributor on how to approach the client. If the distributor requested, I would speak to the end user myself.
This said, all parties should understand that minor, unavoidable fluctuations will occur on reorders. We keep samples of every imprint we make so we can guarantee consistency on reorders. However, despite these efforts and rigorous process controls, imprints will vary slightly. Sometimes, an end user will nitpick a reorder and complain about a slight deviation. In these instances, I try to educate the distributor so the situation can be explained to the end user. If the end user does not accept the explanation, then I delicately ask the distributor how valuable that client is, so we can decide whether to move forward.
In 1987, Tom Vann founded Target Graphics, a contract screen-printing company that exclusively services promotional products distributors and wearables manufacturers. He has won more than 30 screen printing awards, written numerous articles for industry magazines and engages in industry speaking. Reach Vann at tvann@targetgraphicsltd.com or 800-689-6461.
Larry Decker is a 10-year promotional products veteran and has owned Naperville, Illinois-based AIA/Great Lakes for seven years. He specializes in creating and hosting events for local firms to Fortune 500 corporations, and more than 70 percent of his business comes from apparel sales. He can be reached at decker@advinadv.com or 630-548-1493.
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