The trends, the issues, and productive business
Do What You've Always Done
The scrapbook industry is in trouble! Some
by Lisa Kanak (November 15, 2004)
(Note: Lisa Kanak of The Cropper's Corner in
Fredericksburg, VA wrote and distributed the following article to
various groups and CLN. We are re-printing it here,
interspersed with our own comments.)
There's this health nut on television my parents used to watch
each week. For about an hour he’d be talking about sugar and yeast
and how it was the root of everything from obesity to cancer. He’d
parade people through to promote Noni juice and expensive
supplements – and provide a series of "prescriptions"
for callers' ills.
Inevitably, callers would comment about how they tried one thing
or another – or how they went to their doctor and they were told
to "stick with the old program"; he’d issue this
proclamation: "Do what you've always done and you’ll get what
you’ve always gotten."
Now, I have no idea if this man's prescriptions for curing
various health problems really work (although, to be honest, I'd be
willing to try some of them); but it was his weekly challenge that
stuck with me, because it’s true.
And it's not just true for people looking for the fountain of
youth or a cure for the tire around one’s midsection; it's true
for retailers and manufacturers alike.
The scrapbook industry is in trouble. Year after year the
majority of retailers deal with debt that just won’t go away.
Product is released faster than they can get it on the shelves.
Rabid customers who, like Pavlov's dogs, have been trained to pound
on our doors for "the next hot thing" – while their last
requests gather dust on clearance racks.
Yet day in and day out retailers and manufacturers do the same
things out of habit – or simply because "that's the way it's
always been done." And then we complain when we get the same
The answer seems obvious: something needs to change! Retailers
are quick to point the fingers at manufacturers and manufacturers
are quick to point the finger at independents. But the truth is,
there is enough "blame" to go around. There isn't an
overnight solution (although I wish there were), but there are a
number of things we can and should try.
There have been countless articles on how retailers can succeed,
but very little feedback given to manufacturers about what they
might be able to do differently to increase their sales and
encourage retailers to purchase.
First, let's set up the scenario we'll be dealing with.
In order for manufacturers to make items more cost effective,
large orders must be placed. They have to get rid of the old product
fast in order to release more new product in a few month's time –
hoping to keep a percentage of the scrapbook market. Consumer
magazines are flooded with advertisements (sometimes months in
advance of the products' ship dates), fanning the flames of desire.
That drives retailers to their booths to make a one-time purchase of
a large quantity of products that will hopefully, one day, be
purchased by consumers.
So, what’s the problem with this scenario? What is it about
this cycle that is causing so many problems in the scrapbook
industry? I’ll give you a hint: it's only three little words.
Still can’t guess? Okay, I’ll tell you: "one-time
Now, I know the manufacturers out there are violently nodding
their heads up and down saying, "You’re right, that’s the
problem, and that’s what we've been saying – stores don’t
And I know what most retailers are saying: "What? Re-order?
"You've got to be kidding! Do you know how long it took me to
get that (fill in the blank here) out of my store?!?"
That's because for years no one has been looking at one little
concept: sell through. Manufacturers blame retailers for not
calculating sell through when they purchase. A valid complaint, one
may be sure. They point retailers to distributors telling them that
if they can't sell through the product when they are purchasing
direct – well, get it from a distributor!
But here’s the rub: distributors sell by the package. So if the
stickers only come on rolls, the distributors sell them only on
rolls. If the paper is packaged in 50's or 100's, the distributor
only sells it in 50's or 100's.
And so the cycle continues. Retailers buy the item once and move
on while manufacturers feel "compelled" to produce more,
while their warehouses remain full.
Prior to MemoryTrends, our store was already working on
calculating our product turn rates (not an easy process, since our
very expensive POS doesn’t support this through any of its
reporting functions). Let me also say that our store is considered a
"large" store. We have 4,000+ sq. ft., are located in a
high-traffic retail center, and have a population base of more than
a million people in with a median income of $65,000 in a 20-mile
Our sell-through statistics: Printed Paper (packaged in 50's) –
the average sell through is FIVE months ... Stickers (packaged in
12's) – the average sell through is THREE months ...
Embellishments (packaged in 6's) – the average sell through is
The fundamental key to retail success is product turn – how
quickly product moves through our stores and warehouses. The faster
we sell it (without running out), the more money we have in our
For the sake of argument, let’s just say my store has a turn
rate of 3.5; this means retailers are purchasing enough product for
three and a half months of sales at a time. (Comment: That's
only one way to calculate turnover, but it's valid for the point
being made.) Whether retailers choose to finance this on credit
cards, with net 30, or pay cash in advance, the retailer is
the money well before the product sells. This prevents re-orders
– or runs up net-30 accounts; all of which cause problems for
retailers and manufacturers.
(Comment: One reason why Wal-Mart is so successful is that
the company systems allow 80% of their products to be before
they are paid for.)
A simple solution manufacturers can employ to increase product
turn rates, re-orders, and new orders would be to lower product
package depth requirements.
Lowering product package depth requirements allows retailers the
flexibility to purchase enough to test new products – and to
re-order those that that sells well. We’ve found the following
rates work well for most stores that are at least 2,000 sq. ft. with
an average daily customer count of 30:
Embellishments: 3’s ... Stickers: 6’s ... Printed Flat Paper:
20’s ... Specialty Paper (this includes specialty textures,
embossed, mesh, vellum, etc.): 12’s ... Cardstock: 25’s.
(Comment: The more often a vendor has to package a product
(e.g., papers in 25's instead of 50's), the higher the vendors'
costs. To stay in business, those higher costs would have to be
passed on to retailers.)
Most medium-sized stores can absorb these quantities and maintain
healthy turn rates. Larger stores would probably follow initial buys
of paper in the same quantities, but would probably increase
stickers to 12’s and many embellishments to 6’s.
The product would turn more quickly, enabling retailers to
re-stock shelves more quickly, and not "rob Peter to pay
There are also many other things manufacturers can do to increase
re-orders and increase their product turn rates:
1. Mix and Match -- Papers that mix and match are a hit with
consumers because they are so versatile. You can combine
three-to-five papers a number of different ways to make each
scrapbook page look "unique." Whatever you do, don't do
too much. Manufacturers fall into the "more is better"
trap as often as retailers do. Keeping product lines to
three-to-seven coordinating patterned papers keeps the line easy for
retailers to pick up – and easy for customers to manage.
2. Instead of always looking for different papers, create
different embellishments. Instead of a paper for every possible
theme in the market, create embellishments and stickers for those
themes that mix and match with current product lines. The product
depths are lower for everyone – and make it easier to turn the
product and offer a variety.
For example, instead of releasing an entire line of
"wedding" papers, create a lovely floral paper and wedding
embellishments that can be used with the papers. This increases the
versatility of the currently selling line and encourages retailers
to keep the older paper in stock (as long as it's still selling)
because you've added a "new" use for the paper.
3. Advertise your older product! Why is it that when new
product is released, it becomes the only thing advertised? Customers
quickly forget what was advertised until they see it used on page
layouts in magazines. Unfortunately, the paper and embellishments
being used on the layouts is often a product that was released 12-18
months earlier! Customers become frustrated because they can no
longer find the products used in the "soft sell" of the
page layouts – and they can’t find ideas to use the "hard
sell" products that are being advertised. Advertising does push
demand, so find out how you can re-market that "old"
(Comment: Scrapbook novices don't know which products are
new and which ones are old. If retailers concentrated more on
attracting new customers, they wouldn't have such a problem selling
the remains of the old inventory.)
4. Feature old product with new techniques! Remember,
consumers are trained to like what they see in magazines. Magazines
rely on manufacturer advertising to survive: you control their purse
(Comment: After walking a trade show with, a very savvy
independent told CLN, "You know, I don't really need new
products. What I really need are new ways to sell the products I
5. Target Market: Many magazines are getting large enough
where advertising can be regionalized. Magazines have the ability
(just like paper and sticker manufacturers), to make plate changes.
If you demand regional advertising, they should provide it.
6. TEST it! Focus groups have long been used by manufacturers
for everything from a product spokesman to the colors used on the
packaging. Many manufacturers do limited regional testing to figure
out where they will get the most bang-for-their buck. If a product
is lackluster in the Southeast, then don’t sell it in the
Scrapbook supplies are no different; some things simply sell
better in certain parts of the country than in others. After some
time, re-test it. You might be surprised to lean that while interest
was low on the East Coast initially, after a little time, the
interest picks up – and you have a whole new lease on the product
you released at the winter show the year before!
(Comment: In its early years, scrapbooking sales were much
different from one part of the country to another. That's probably
7. Join forces. Printers also have a dirty little secret;
they buy in larger quantities than you do. You can take advantage of
this by joining forces with other manufacturers to print your orders
during the same time-frame. If two manufacturers want to produce 5mm
sheets of printed paper each, by doing a joint run you both get the
10mm sheet price with only a small plate change cost.
The same is true for stickers. This enables manufacturers to
print smaller quantities (enabling you to turn product faster,
becoming more profitable), and still remain cost competitive.
8. Project ideas – no, you don’t have to have a
full-blown class program! You can provide retailers with the
step-by-step instructions, and JPG images of the final product (s);
perhaps they are ideas you've taught on the road at various
conventions and trade shows, created by your design teams, or
possibly even LSS that sell your product and are willing to share
ideas. Put them on a "retailer-only" section of your
website and they will be used!
(Comment: It's been true for decades in crafts: if you
have slow-moving merchandise, create a made-up or distribute an
instruction sheet of a project using that merchandise. Sales will
I'm sure there are many other things that manufacturers can do to
assist retailers with product turns, re-orders, etc. These are just
the ones our group of retailers came up with.
Remember, the industry HAS to change if we are all going to
survive and profit. If we keep doing the same things we’ve been
doing, we will get the same results!
Note: Have any comments on Lisa's suggestions? Email them to firstname.lastname@example.org
or to Lisa directly at email@example.com.
To read previous Memory, Paper, and Stamp columns, click on the
titles in the right-hand column.