140 replies to this topic

[royster13]

There has been nothing in this thread about the quality of the work....By most accounts Apollo does great work.....If I can only get one, I would rather have great work and crappy policies versus great policies and crappy work....I am sure Glenn will work hard to come up with something most of us can live with....RCS...

[ideaguy]

Glenn, in all fairness, I think Rich has some valid points, and others here have voiced their viewpoint. Perhaps, Rich could have posted the issue a little differently, though he did make good faith efforts to have your company rectify them. I don't think it is the amount of money, but rather principle of the whole thing. No ones likes the feeling of being taken advantage by poor policies.

I believe that Rich is correct. You may want to rethink your policies. These specific ones in question are enough to not want to do business with a supplier. Having said that, do the right thing for Rich, and chalk it up for experience. This may be one situation where the Distributor is telling you there is an issue with your policies, and perhaps, you should listen more intently.

Some Distributors, however, will not say anything and just never use you again. This is an inexpensive lesson. Rich is actually doing you a favor here by pointing out, what appears to be, two unfavorable policies. You now have an opportunity to recognize the issue, and make a good decision today in front of your peers at DP. Also, I do think many people here appreciate your contribution to DT...IDEAGUY

[FindingPromo]

Glenn,

In all fairness, looking at your Suppliers' side, job costing and cost accounting principles are also in order to consider all sides here. . . .

Any company can have their policies, and procedures, and it seems like this as in lot of these cases out here on DT - it's all about saving money for distributors, when you are in the "fishbowl," like it looks like you have been placed. . .

Not seeing any former production or sales managers for Suppliers coming in with the reasoning of your side yet . . .

Your cost accounting needs may vary, but let's say for discussion's sake, that you have 12 head machines, and you work the costing out accordingly - to charge your customers for the most efficient use of those machines, by charging LTM's when the machines are not filled (each and every Machine "Head") with revenue generating items, each and every time they are flipped on.

There could be a scenario where you may choose to have a $90 LTM or (Less then efficient use of machine) charge. Whether the machine has one garment on it or 11 out of twelve. A balanced and fair average amount.

If you were to follow the "save money for a distributor approach" as this concensess seems to be stearing you towards, you would REDUCE the LTM for those that are closer to the full 12 embroidery heads being used . . . .then are you to then charge MORE for the LTM ??? for someone that is using only one or two heads out of the machine.

When it comes to the charging for drop shipping. Again, every production house has different cost accounting needs, and some shipping and production order systems have default shipping addresses that auto-load and are most efficient in their systems. I have been in enough Supplier and Distributor, Embroidery, Fullfilment and shipping facilities to know, that drop shipments, mean more printing, more double checking and more add'l QC steps to ensure the process is done correctly.

It sure seems like many people think that all this stuff happens - Auto-Magically without any add'l people skills/QC involved . . . . .

Once again as I've said before, Nothing that is a service that is provided by a provider is FREE. It's simply how it is marketed to the buyer.

Quality houses whether they are Supplier, Distributor or anywhere, cover thier costs with a fair amount of profit, and should not be bound to outline the details of their policies, each and every time as long as in the long run they are fair. Customers that use your services over and over again, are not surprised by these fair costs of doing business, that I would think you include, while not charging in other areas as some do and/or aka FREE.

It makes sense in this situation to look at your cost accounting and pricing procedures, but this order just like I'm sure the thousands of other orders are all unique, and each and every one, cannot be expected to command systems and pricing changes, or it just leads to other inefficiencies.

Good luck to all and may you all be profitable in your businesses - Distributor and Supplier alike . .

[Chris Miller]

FindingPromo said:

Any company can have their policies, and procedures, and it seems like this as in lot of these cases out here on DT - it's all about saving money for distributors,

Slow down now Marc. My issues are not about price AT ALL. They are about PRINCIPLE. I cannot speak for Rich with his issues but I would bet it's about principle for him as well. To say "Its all about saving money with distributors" is a bit much - don't ya think?

A few bucks on an order is not going to bother me but tie them into your costs. Don't try to look like the guy with the cheapest stuff and then tack on 42 different fees to the invoice to make your money. This is especially true when selling online. All those little fees that the customer doesn't see come off of MY bottom line. Tie it into your item cost and the customer sees it and knows its coming. I would never think to add all that garbage to a customers invoice.

It's all in how you market yourself. No one wants to be nickel and dimed to death and no one wants to work with a supplier who is difficult to deal with, and we CERTAINLY don't want to be hit with hidden fees (drop ships, credit card "convenience" fees, handling fees, and all the other ones that fit the description of "nonsense".)

It's really that simple.

[neoadman]

WOW Glenn - Looks like you need to put US distributors on your Payroll as consultants!! I for one do not see where your policy making should be made on any forum but your own.
What is the difference when distributors "customize" our pricing to fit our needs. If I do not want to charge a set-up - i work the cost in elsewhere. I might not charge shipping to make a customer feel good but the cost IS worked into the deal.
Come on guys - if we "force" Glenn into changing a pricing policy, He will need to work the cost in else where.
If he cannot make a profit and close his doors, where will we get our Caps next year? the next Supplier might not be as Nice.

Steve

[biggerfish]

That's right Chris - It ain't about the dough so much, it's about the yummy surprises at the end of the deal.

When I first discussed this job with Glenn, he suggested that to save money I go to one of the $3/1000 digitizers. Instead, I gave the digitizing work to Apollo - four logos at $60 per - to insure a quality job of course, but I also happen to think it's the right thing to do. I don't take eggs and bacon to Waffle House and ask them to make me breakfast. The logo is the exact same on the visor and polo, but are different sizes, and I still got whacked full price for each one. That's OK, because I saw that coming, and it's in my price.

I know the costs of embroidery up front. I know the cost of digitizing up front. I set my price accordingly and get the check. The stuff that gets sneaked in at crunch time, when you have no recourse, is the 'Stupid Supplier Policy' I brought up here. Glenn can run his business as he sees fits, as I'm sure he will. I have no personal beef with Glenn, but I do have a professional beef with Apollo.

And BTW, Apollo has that "Credit Card Handling Fee" of 3% as well. Surprise! Another $20 bucks into the road that I cannot recoup.

[FindingPromo]

Chris Miller said:

Slow down now Marc. My issues are not about price AT ALL. They are about PRINCIPLE. I cannot speak for Rich with his issues but I would bet it's about principle for him as well. To say "Its all about saving money with distributors" is a bit much - don't ya think?

A few bucks on an order is not going to bother me but tie them into your costs. Don't try to look like the guy with the cheapest stuff and then tack on 42 different fees to the invoice to make your money. This is especially true when selling online. All those little fees that the customer doesn't see come off of MY bottom line. Tie it into your item cost and the customer sees it and knows its coming. I would never think to add all that garbage to a customers invoice.

It's all in how you market yourself. No one wants to be nickel and dimed to death and no one wants to work with a supplier who is difficult to deal with, and we CERTAINLY don't want to be hit with hidden fees (drop ships, credit card "convenience" fees, handling fees, and all the other ones that fit the description of "nonsense".)

It's really that simple.

Kris,:) (it's Mark with a K here. . )

I don't remember addressin' the "42 issues" you reference, from what I recall, from my previous post, I was trying to show some justification via strong cost accounting practices for a total of the "2" mentioned in Glenn's instance, to show variable costs, that each and every order, and each and every distributor should not be charged for.

Part of the challenges that on-line sales activity brings is the need to have even more of your homework done if you are trying to pull through orders from each and every supplier, that some folks have worked many times with great success, for profits for the Distributor and for the Supplier. . . many do not find these as "hidden costs," when they actually work Multiple orders like these through in repetition from their chosen suppliers and build in these variable costs.

Not running embroidery machine heads hold an "opportunity cost" as well as a need to pay the light bills that cover those unused machine heads etc. Light Bills as well as the cost of an attentant to work the machine, whether they have one shirt on the machine or 11 or 12 on a 12 head, the employee still needs to get paid, and have all of their benefits covered etc.

Production efficiences are important in any size shop, and employ thousands of people in many industries in Industrial Engineering to create those efficiences. (my wife is a part of managing those efficiencies in here work for a little airplane manufacturing company in Seattle). Not that a $100 Million airplane is exactly the same, but they too have variable costs when certain carriers customize them for their own needs - their are EQP's discounting rebating and other similarities even there to our world.

My comments were not about 42 of your challenges Chris, but about the true fair reasoning for LTM costing and drop ship charges, that have a real cost. One that not every order should be responsible for, as chosen by this particular Supplier.

Your comments in other areas beyond LTM's and Drop Shipping, I will not address, as I do not believe they are germane to the discussion in this particular instance

[FindingPromo]

biggerfish said:

That's right Chris - It ain't about the dough so much, it's about the yummy surprises at the end of the deal.

When I first discussed this job with Glenn, he suggested that to save money I go to one of the $3/1000 digitizers. Instead, I gave the digitizing work to Apollo - four logos at $60 per - to insure a quality job of course, but I also happen to think it's the right thing to do. I don't take eggs and bacon to Waffle House and ask them to make me breakfast. The logo is the exact same on the visor and polo, but are different sizes, and I still got whacked full price for each one. That's OK, because I saw that coming, and it's in my price.

I know the costs of embroidery up front. I know the cost of digitizing up front. I set my price accordingly and get the check. The stuff that gets sneaked in at crunch time, when you have no recourse, is the 'Stupid Supplier Policy' I brought up here. Glenn can run his business as he sees fits, as I'm sure he will. I have no personal beef with Glenn, but I do have a professional beef with Apollo.

And BTW, Apollo has that "Credit Card Handling Fee" of 3% as well. Surprise! Another $20 bucks into the road that I cannot recoup.

Rich,

I'm not necessarily trying to take a particular side here, but running a design on a hat, is not always the same as running it on a shirt.

Many quality embroidery houses will have a different file for fleece, for flat knits, for jersey knits, for polar fleece for Twill caps, for knit caps and for foam visors. It sounds like they'd all be the same, but the quality of a design and how it looks on those different substrates are different, and the embroidery machines also use sometimes different needles for different garments, as well as run the designs in a different "pattern."

There's a lot goin' on in a muti-functional embroidery shop, completely seperate from a pad printer that can be sometime set up with one logo, and have 20 different platic items run underneath it.

And again, why are any of these surprises to you, the cc charge, the LTM etc. did you not know of these in advance? If you did not know of them, then I think it's a matter of communication of the policies, and or your review of them, instead of what seems to be big surprises here . . ..

Again, not taking a particular side, here, but I would think that if you were to choose to use this Supplier in the future for their Total Efforts, I would think that you would begin to know more of the variable costs that certain order should be bearing, and not all orders.

I'm sure there's much more to the order here, but that's from my knowledge base. . ..

[ideaguy]

Chris, you have articulated what it really is all about....and I agree with you.....IDEAGUY

Chris Miller said:

Slow down now Marc. My issues are not about price AT ALL. They are about PRINCIPLE. I cannot speak for Rich with his issues but I would bet it's about principle for him as well. To say "Its all about saving money with distributors" is a bit much - don't ya think?

A few bucks on an order is not going to bother me but tie them into your costs. Don't try to look like the guy with the cheapest stuff and then tack on 42 different fees to the invoice to make your money. This is especially true when selling online. All those little fees that the customer doesn't see come off of MY bottom line. Tie it into your item cost and the customer sees it and knows its coming. I would never think to add all that garbage to a customers invoice.

It's all in how you market yourself. No one wants to be nickel and dimed to death and no one wants to work with a supplier who is difficult to deal with, and we CERTAINLY don't want to be hit with hidden fees (drop ships, credit card "convenience" fees, handling fees, and all the other ones that fit the description of "nonsense".)

It's really that simple.

[ideaguy]

Mark, every company creates its own business model and pricing is a key factor in doing so. From my experience with different vendors (18 years), I have never been charged a "drop-ship" fee - a "split-shipment" fee is a different issue. As a matter of fact, drop shipping is part and parcel of our industry - it is what makes the concept of having Distributors work. If you are charging an additional fee to do so - it behooves me. A charge for the latter seems to be the norm. In Biggerfish's case, I believe it was not a split shipment fee, but rather a drop shipment fee.

You are correct in what you say about variable costs, production efficiencies, etc... How could one run a business without these fully considered. ..? Though, from my experience, I have never been charged from an embroiderer the additional fees that Bigfish has noted here.... I have had good and bad experiences with at least 6 different embroidery companys. For a different sized design, the factory can go up or down 10-15% in size (in most cases) and still maintain the integrity of the design.

It appears that Biggerfish was charged several times unnecessarily, and unfairly, and I find that to be the issue....IDEAGUY


and appears to be

FindingPromo said:

Kris,:) (it's Mark with a K here. . )

I don't remember addressin' the "42 issues" you reference, from what I recall, from my previous post, I was trying to show some justification via strong cost accounting practices for a total of the "2" mentioned in Glenn's instance, to show variable costs, that each and every order, and each and every distributor should not be charged for.

Part of the challenges that on-line sales activity brings is the need to have even more of your homework done if you are trying to pull through orders from each and every supplier, that some folks have worked many times with great success, for profits for the Distributor and for the Supplier. . . many do not find these as "hidden costs," when they actually work Multiple orders like these through in repetition from their chosen suppliers and build in these variable costs.

Not running embroidery machine heads hold an "opportunity cost" as well as a need to pay the light bills that cover those unused machine heads etc. Light Bills as well as the cost of an attentant to work the machine, whether they have one shirt on the machine or 11 or 12 on a 12 head, the employee still needs to get paid, and have all of their benefits covered etc.

Production efficiences are important in any size shop, and employ thousands of people in many industries in Industrial Engineering to create those efficiences. (my wife is a part of managing those efficiencies in here work for a little airplane manufacturing company in Seattle). Not that a $100 Million airplane is exactly the same, but they too have variable costs when certain carriers customize them for their own needs - their are EQP's discounting rebating and other similarities even there to our world.

My comments were not about 42 of your challenges Chris, but about the true fair reasoning for LTM costing and drop ship charges, that have a real cost. One that not every order should be responsible for, as chosen by this particular Supplier.

Your comments in other areas beyond LTM's and Drop Shipping, I will not address, as I do not believe they are germane to the discussion in this particular instance

[ideaguy]

Mark, you are right about the different fabrics and digitizing differently for each. We don't know enough about Biggerfish's products that were embroidered to make a call on this one. I had noted something in my prior post about going up and down 10-15% in size and still maintaining the integrity of the logo design (and not needing additional digitizing design fee. If the fabrications were totally different, such as a towel and a knit shirt, I agree...IDEAGUY


I'm not necessarily trying to take a particular side here, but running a design on a hat, is not always the same as running it on a shirt.

Many quality embroidery houses will have a different file for fleece, for flat knits, for jersey knits, for polar fleece for Twill caps, for knit caps and for foam visors. It sounds like they'd all be the same, but the quality of a design and how it looks on those different substrates are different, and the embroidery machines also use sometimes different needles for different garments, as well as run the designs in a different "pattern."

There's a lot goin' on in a muti-functional embroidery shop, completely seperate from a pad printer that can be sometime set up with one logo, and have 20 different platic items run underneath it.

And again, why are any of these surprises to you, the cc charge, the LTM etc. did you not know of these in advance? If you did not know of them, then I think it's a matter of communication of the policies, and or your review of them, instead of what seems to be big surprises here . . ..

Again, not taking a particular side, here, but I would think that if you were to choose to use this Supplier in the future for their Total Efforts, I would think that you would begin to know more of the variable costs that certain order should be bearing, and not all orders.

I'm sure there's much more to the order here, but that's from my knowledge base. . ..[/quote]

[plantia]

There are other companies that do charge a drop ship charge. BCI does, and since fiding out about it, I have everything shipped to me and deliver myself in order to avoid the charge.

[ideaguy]

I agree with you here. Though, BCI is not a traditional company in our industry. Some printing companies seem to charge for the service - most do not...IDEAGUY

plantia said:

There are other companies that do charge a drop ship charge. BCI does, and since fiding out about it, I have everything shipped to me and deliver myself in order to avoid the charge.

[Schlep]

If I understand this post he is being charged to ship to an address other than his address. All of the goods we buy from the USA are shipped to Dearborn Michigan. Our PO states a sold to address (in Canada) and a ship to address in the USA.

I have never ever been charged an extra charge for that.

Years ago when we had to send our art in by mail some companies would require a label with the ship too address on it but I have not seen this for over 5 years.

I always thought a drop ship charge is where you order the goods and the company has 3 locations and you devide the order up and have to drop ship to the 3 locations not just one location.

This would incur extra charges.

[plantia]

Drop Ship is for shipping to someone other than the buyer.

Split Shipment is shipping to more than one location.

[ideaguy]

I've had similar experience with this. In terms of a "drop-ship" fee, I believe that is to ship it to any location. If the order needs to be split up and shipped to 3 different locations, than that would be a "split-shipment" fee. Some companies do have a "split-shipment" charge. Though, this is not the issue with Biggerfish. He was a charged a drop-ship charge....and that is different...IDEAGUY

Schlep said:

If I understand this post he is being charged to ship to an address other than his address. All of the goods we buy from the USA are shipped to Dearborn Michigan. Our PO states a sold to address (in Canada) and a ship to address in the USA.

I have never ever been charged an extra charge for that.

Years ago when we had to send our art in by mail some companies would require a label with the ship too address on it but I have not seen this for over 5 years.

I always thought a drop ship charge is where you order the goods and the company has 3 locations and you devide the order up and have to drop ship to the 3 locations not just one location.

This would incur extra charges.

[Schlep]

plantia said:

Drop Ship is for shipping to someone other than the buyer.

Split Shipment is shipping to more than one location.

Thank you Sue I stand corrected.

[Schlep]

ideaguy said:

I've had similar experience with this. In terms of a "drop-ship" fee, I believe that is to ship it to any location. If the order needs to be split up and shipped to 3 different locations, than that would be a "split-shipment" fee. Some companies do have a "split-shipment" charge. Though, this is not the issue with Biggerfish. He was a charged a drop-ship charge....and that is different...IDEAGUY

Yes but it is no different than my goods being shipped to Dearborn Michigan when I am in Ontario.

We also did an order for an account in Buffalo and it shipped direct to Buffalo, we did not have any extra charges.

[borovitz]

A suggestion to all distributors: Add a line item to your Purchase Orders that states "any charges other than shipping will not be paid unless they are on a revised Purchase Order." I started putting this on my PO's last year after a supplier nickel and dimed me to death. Now I always request a full written quotation from my vendors, and then hold them to the quotation unless I change something.

I can see the point in charging a LTM charge on the Polos since there are only 6, and cutting the LTM charge in half seems fair.

Glenn,
The Drop Ship charge of $6.00 seems ticky-tack, I understand a split shipment charge, but if everything is going to one place what is the difference to you? The "Credit Card Handling Fee" if that is how it is billed could violate your credit card agreement and cost you the right to accept credit cards, or generate a fine. As a former Visa employee I can tell you that you can offer a cash discount, but not any kind of credit card fee. Besides you more than make-up the fees in cash flow.