Blog #199 I talked about Merchandising progression plan begins July 2004. In this blog I want to talk about A Starbucks pitch and Private Label position

So I talked earlier about the million dollar challenge with Skechers. “How do we get to 1 million in sales” I would ask. Back then, this was a big number for a lot of our brands. Especially when they were doing half that amount. So basically how do we double the business. There were 5 different categories of Skechers at the time, Skechers Sport, Skechers USA, Skechers Dress, Mark Nason and Skechers Work.

The work area was a fast growing area and had sizes and widths. If we could keep a flow of goods coming in our business was great. My rep for that area was Jim. He was a great guy and I really enjoyed working with him. He would let me know all the work programs that were out there like “Shoes for Crews” and others. One day he came in and said we should try to pitch a program to Starbucks. He outlined the plan for me.

I ran it by Fred to see if from a technology standpoint we could pull it off. Tony got involved and we started brainstorming how we could do the program. Jim set something up with Starbucks headquarters so I put together a presentation for us to show them. It outlined our history and what we do for our vendors and how the program could work.

We flew out to Seattle and arrived at their headquarters. It was a beautiful office with a lot of history of how the company started. It was amazing. While we were getting coffee in the morning Fred informs me that he wants me to head up the private Label area. This threw me off a little and quite honestly wasn’t on my game for the presentation. It was fine though because we had to go back and figure out some things they would require like partial payments for the employees.

When I got back Fred pulled me in the room and asked me what my decision was. Private label was only about 1 ½ % of the business. The styles were all over the place and the quality wasn’t all that great. I remember Harry from Nordstrom saying “always offer the best product and at a fair price.” We had some work to do. We had a bunch of $8 shoes that weren’t all that great. I was intrigued by the challenge though.

I told him I would do whatever was best for the company and if he felt my experience would help get private label going I’d do it. We had like 18 brands under the Private label umbrella so the first thing I was going to do was clean that up. I agreed to maintain 30 of the brands that I was doing in the regular branded world which was about half of the 60 brands I had before and keep Stuart Weitzman as well. 

The minimum quantities we had to write were 180 to 500 per color so this was also going to be a focus to get the minimums down to improve the poor sell throughs. The WSA show was next week so for this show I’d have to split my time with the portfolio of brands I was keeping and sourcing items for private label through current brands that had Private label programs.

Some of my current branded side also did private label for people so it would be easy to do both worlds at the appointment, problem was still the high minimum quantities. To give it some clarity in the regular branded world if you wrote 180 pairs per color that was a great style and usually you would write just black and brown in those quantities. Every color had those minimums in private label brands though so it made it challenging.

Reason for this is they would have to change the leathers when they would make the shoes so it would cost the factory time if that was a frequent thing. We would have to get creative or find different factories to make this work for us.