irreverent, thought-provoking analysis of the industry.
ARE WE STIFLING CREATIVITY?
How we're driving the industry's creative
people out of business.
by Mike Hartnett (June, 2003)
Our industry has always thrived on creativity; it's the fuel that
powers our growth. So how are we doing? A casual observer walking
our trade shows might conclude that the industry is prospering,
given the multitude of new products on the show floors.
I'm not so sure. Recent trends are making it more difficult for
new products to be seen by the consumer. New products make it to the
trade show floor, but how many make it onto store shelves? Some
1. Some large retailers want to reduce the number of
vendors from whom they buy. Very understandable: better to deal with
vendors who have a proven track record of reliability. But that can
lead to serious ethical problems. Some smaller manufacturers have
complained to me that they have developed a new line, often in
conjunction with a retailer, only to have that retailer give the
designs/ideas to a larger vendor.
That happened recently to a good little company. The owners, who
have created a number of excellent, strong-selling products over the
years, are so disgusted they're selling their company and getting
out. Will our industry really be better off when they're gone?
2. Testing makes sense, if the tests are fair. It's
perfectly logical to test a new line in a handful of stores before a
buyer makes a chain-wide commitment. But sometimes the tests aren't
fair. I know of one vendor who spent tens (hundreds?) of thousands
of dollars developing a really unique new line. The buyer loved it,
but insisted on a test in about 20 stores. Ok so far.
The vendor visited many of the stores during the testing period,
only to find that in half the stores the new line never made it out
of the back room. The buyer ultimately deemed the test a failure,
and so consumers never had the chance to accept or reject it.
As a result, the owner changed the direction of his company.
Instead of introducing cutting-edge new lines as he'd planned, he
started making cheaper versions of products already on the market.
It's not the vendor's fault; he's got payroll to meet and rent to
pay. Cheaper versions of popular products -- is that what the
industry needs for sustained growth?
3. Some retailers are taking longer between department
re-sets. The logic is, better that store clerks wait on customers
rather than move merchandise around the store.
Oh? Does this have to be an either-or proposition? Our best
customers, whether they're crafters, painters, scrappers, home
sewers, or needleworkers, always ask, "What's new?"
In January, as exhibitors in a particular category scrambled to
get their new lines ready for the Hobby Industry Association show,
they received an email from their buyer at a major chain. The buyer
said the company changed its mind and was postponing re-setting the
department until 2004. Gee, that way the clerks will have plenty of
time to tell the customers there isn't much new.
4. Some retailers take a vendor's product and have it
copied overseas. If U.S. manufacturers go out of business, what kind
of industry will we have?
5. Some retailers will take on a new line, but make such
demands (lower price, ad allowances, rebates, etc.) that the vendor
doesn't make any money unless the line is a mega-hit.
6. What I've written above is relatively new in the
history of the industry. What is not new is vendors stealing product
ideas and designs from designers and other manufacturers. How much
has the industry lost because creative, inventive minds give up?
The end result of all this? Talented, creative people and
companies are saying, "What's the point?" If vendors and
designers aren't compensated fairly for their creativity, they'll do
And ultimately, we will all be the lesser for it.
Here's a history lesson: Fabric painting was the scrapbooking of
the 1980's. The company that started it all was Tulip, led by Dave
Lester, a chemist who invented "puff" paint.
For years, nobody cared much about fabric painting and Tulip hung
on by its fingertips. Finally the company went bankrupt. Dave tried
to sell it for $300,000 but couldn't find any buyers. So Dave kept
going and finally, the consumer slapped her forehead and said,
"Wow! Squirting paint on the T-shirt -- what a great
A few years later Dave did sell Tulip -- for $100 million.
Somewhere out there are the creators of our next hot trends. Can
they survive long enough in today's marketplace until the consumer
(Note: For a prominent vendor's take on a related issue,
click on the "Vinny Da Vendor"
button and read, "What Happened To Strawberry?")
Have any thoughts on the subject? Call Mike at 309-925-5593 -- on
or off the record -- or email Mike at email@example.com.