Beat the Promotional Products Industry at their own Game
We let you in on a few secrets about the promotional products industry.
It’s about time you learned how to buy your promotional products smarter and for far less money. What we are about to reveal here will forever change how you look at buying your promotional swag!
Promotional products sold to you from your local distributor usually go through at least 3 to 4 different “hands” each time increasing their actual cost by 30-50%.
These steps are:
- Factory: Let’s face it, pretty much everything is made in China. Having owned factories in China, I can tell you that each product has between a 25-45% profit after costs of materials and overhead.
- Trading Company: 80-90% of all promotional swag does not come from the actual factory but from a uniquely Chinese concoction called a trading company. Trading companies do not make anything but instead source from factories the various products. They then logo them, market them and have a team of salespeople who sell to anyone in the west (USA or Europe) willing to buy. They also add and additional 25-35% to the price.
- Promotional Product Suppliers: These are generally US or EU based warehouses who may import in bulk promotional products that they buy from the trading companies. The suppliers buy in large quantities and often logo the product domestically. The largest of this type of supplier is Leeds who is worth several billion dollars in annual sales.They sell exclusively to the next one on the food chain.
- Promotional Product Distributors: These are your local-based promotional products guys/gals. They will sell you anything from “soup to nuts”. They will come to your office to drop off a box of pens or leave behind countless catalogs. They will phone you often and will always ask you about “your next marketing initiative?” They buy from the promotional product suppliers primarily for 2 reasons. Firstly, The suppliers will give them payment terms allowing them to pay 30-45 days after they deliver the product and secondly because the suppliers will sell them very small orders like a half-dozen T-shirts or a dozen golf balls. promotional product distributors add 40-100% to the price they pay from the supplier.
What is ASI or PPAI and why this concept is now outdated?
ASI and to a lesser degree PPAI are organizations that represent both supplier and distributor. In the pre-internet world they rigidly governed who could buy and sell promotional products, what prices the distributor could sell the products for and in general kept the free market out of the promotional product game. It worked well for a long, long time.
The Internet Changed Everything.
Pre-internet everything in the promotional products business was done in catalogs. They were released once maybe twice a year in January just before the main trade show and often a fall (September) supplement. These catalogs printed and provided by the suppliers (hundreds of millions printed each year) free of charge to the distributors. In these catalogs and still on the supplier sites you will find pricing that often has letters such as “C” or “A” next to them. This is called coded pricing. It is the price that suppliers want the distributor to sell to you for.
Coded Pricing: In my opinion……ASI coded pricing (aka Suggested Retail Price) is and should be a relic of the past.
What is it? Coded pricing is the suggested retail pricing of promotional products. It is always shown as a letter designation. Usually a “C” or an “A” but what does this mean?
Each letter lets the distrubutor know what to sell the promo product for. The letter also tells them what their profit is!
For instance a promo product with the letter “A” as the suggested price (usually seen on the sites, flyers or in catalogs) means the suggested retail price is DOUBLE the cost that the distributor pays for it from the supplier.
A common letter designation of a “C” or “A” means that the price you pay is 66% more than what the distributor pays the supplier.
In my opinion… These are good folk to know for “pens and mugs with your logo on them”. They really, really know their stuff about pens, mugs, magnets etc.
How You Can Beat The System!
First off, we suggest you fire your local swag merchant. Then read this great blog post on how to save money on swag… click to read
The basic suggestion we can offer you is that in the age of the internet you need search for a better solution on how to spend your marketing budget. Blindly doing the same thing over and over again and expecting a different result is the definition of insanity.
” Asking your logo promo guy to suggest something cool for your logo is like blindly doing the same thing over and over again and expecting a different result, it’s the definition of insanity!”
Most local promotional sellers are stuck in the past while at the same time their clients (end users) are increasingly becoming younger. ASI states in a recent press release that the average Distributors age is 58 while the end-user (that would be you) is and average age of 35!
Now, we have nothing against 58 year olds but we also think that we would not get the best results if we were to ask the average 58 year old what is trending on social media and what would be cool for our logo. The Demographics don’t lie!
“Some Distributors get kickbacks from the Suppliers, Why would YOU pay for this ?”
The other problem with the Promo Industry is that some of the Distributors get kickbacks from the Suppliers on some of their orders for the basic (aka as boring) ideas. In fact there are several promo Suppliers currently facing price fixing legislation. Read more…
The reason this matters to you is simple…if you think your Distributor is giving you the best advice as to what works best for your logo, brand and corporate image it may not be advice that is truly honest!
Trade Show 8. What we do differently.
Trade Show 8 is owned and run only by promotional product specialists. We only source and sell trending Swag! We don’t sell leaky pens and crappy coffee mugs. Everything we sell is trending on sites like Kickstarter, ETSY, Indigogo or on Social Media.
Factory Direct: Today, smaller orders and faster delivery allow us to sell swag factory direct from the source. Our overseas factories provide us amazing delivery and outstanding prices on the coolest promotional swag.
Safe and Secure: We accept all major credit cards and offer a 100% money back guarantee on all of our products.
Fast and Friendly: We offer delivery in as little as a week on most orders and will ship for FREE anywhere in North America or Europe. We also provide live real time customer support. Simply call us at 1-888-908-6932 or email [email protected]
Best Selling Trade Show and Promo Swag Ideas!
Below are just a few of our best selling promotional products designed for your business or event logo. “Get Your Logo On It For Less!”