Analyzing fabric sales

[sofadoc]

My "in-store" fabric sales took a dip in 2012, after holding steady for the last 10 or more years.
I sold about 30% less fabric than previous years, even though my overall sales were higher than 7 of my previous 10 years. 
I've been thinking of the possible reasons for this. Here are a few theories:

1. I did have a very large COM job that consumed nearly an entire quarter.
2. I've been noticing a gradual decline (in fabric sales) over the last 3 years. Ever since my website got up and running. People that find me through the website all have one thing in common......they all have a computer. And while they're on the net hunting an upholsterer, they start poking around, and find their fabric as well. So it's translated into more COM than ever.
3. Small shops have been trending toward "All COM" for the last several years anyway. So I guess it should be no surprise. But if fabrics sales were to continue to decline, what would be the point of having a commercial location?
I may as well work from my garage.

These are just a few observations/hunches. I welcome anyone's opinions. BTW my "in-store" fabric sales for 2013 so far are WAY ahead of 2012's pace. So 2012 may have just been an off-year.

[mike802]

Sofa: Same here, my fabric sales are almost nonexistent, nothing like years back where every customer bought their fabric from me.  Today it is a rare occasion when a customer does not have their own fabric.  I have had to alter my hourly rate to make up the difference that the fabric sales brought in.  I have also had to be careful to explain the the customer that I am not able to guarantee their fabric for flaws, durability, or shortages, even if I estimated the amount needed.  It pains me to not guarantee the amount needed even if the amount needed was estimated by myself, but I just cant afford the risk of a mistake when I would have to pay full retail for fabric that could potentially cost thousands of dollars, if it was even available as so many customers are buying close outs.

[sofadoc]

My "in-store" fabric sales are still a substantial part of my income. But COM's continue to grab a bigger slice of the pie.

Like a lot of small shop owners, I wear multiple hats. Not only am I the upholsterer, I'm also the fabric salesman, bookkeeper, the PU/Delivery guy, and the floor sweeper. So I'm really not interested in selling fabric if I have to take a lot of time doing it. Every minute that I spend showing fabrics to a customer cuts into my labor time for the job.

So if the customer requires a lot of "hand holding", I'd just as soon they go buy their own fabric somewhere else.
Like Mike, I'll just adjust my labor prices accordingly. And also like Mike, no guarantees.

I'm positive that I lose a few fabric sales simply because I show no willingness to babysit the customer while they browse through my sample books.

In other words......if the fabric doesn't "sell itself", I'm OK with COM.

[west coast]

My fabric sales are almost nonexistent as well, I work out of my garage now and love it.

[crammage]

My fabric sales are almost non-existant too.  The only thing I've every supplied has been vinyl, and that has been for commercial customers.  I keep a small supply of blank vinyl on hand for those quick emergency jobs like the beauty salon who's stylist will be out tomorrow but they need to chair back by the next day.

[Mojo]

I can see two things at play. One being that the internet has opened up a whole new world for the consumer. Any Tom, Dick or Susie can open up a store front on the internet and start selling items. Nuts, bolts and yes, fabric. With the advancements in computers and the world getting smaller people can now buy directly from suppliers in China and other countries and then go into business as a supplier.

Consumers are starting to get to the point that they shop for everything on the internet. At the very least they are price shopping. Hell I found myself a few months ago price shopping for prime rib of all things. Rather then drive to Publix and Winn Dixie I just visited their internet sites to see if they had it on sale. I used to depend on flyers which are getting less and less.

Secondly there is something going on in the fabric world that is not good for us. Fabric companies are selling seconds and thirds out their back door. Joe Blow shows up with a pickup and buys a pickup filled with rolls of seconds and thirds or cast offs and they then take it home and sell it on E bay or open up a store front. MiamiMike was telling me that this is going on big time now.

It is getting so bad that even entire container loads of fabric that were flawed were loaded on to ships in NYC and shipped to third world nations at huge discounts for their use since they didn't pass muster in the USA. Guess where it ended up ? Right back in the USA being sold as top grade fabric. The head of a North American fabric manufacturer told me of a ship that sailed from New York to overseas and back to Miami with these type of goods. They hauled a container around the world only to drop this crap right back into the American market.

One of the most abused fabrics that fall into this category is the Marine fabric that is so popular with Marine fabricators. You know which one I am talking about ( I am not going to mention their name ). It is the same fabric that some people think is the second coming. I refuse to have any of this fabric grace my presence. This is the main reason I went to Sattler. It leaves the factory and goes straight to Miami and then straight to my door. No middle men or brokers.

I could relate a lot more of some of the crap thats going on in the fabric world but wont to protect the friends in the industry who have been telling me this story. let me also say it is happening with thread as well. Think your using high grade Poly ? Think again. It is probably Chinese crap that made its way into the market. The reason I standardized on Solarfix, another product that is direct sourced.

I think we have seen just the beginning of a whole lot of headaches with how we conduct our business not to mention the headache of trying to get good products that are not counterfeit or are thirds and castoffs meant for another country. :(

Chris

[sofadoc]

Something else that is prevalent now, 3rd party sellers are popping up online. They buy from the same wholesalers that WE buy from...........at the same price that WE pay...........mark them up 10-20%.........and sell them to the public. They don't even have to carry any inventory. They just have it drop-shipped directly to the customer from the wholesaler.

The wholesaler sells a little extra fabric........the 3rd party seller makes a little money for doing nothing........the customer saves money on fabric...........everybody wins (except ole' Doc).

For all WE know, the 3rd party seller is just a guy with a computer in his mom's basement.

[JDUpholstery]

there are a few suppliers who also sell wholesale to the public, like perfectfit, they have same price whether its a commercial customer or public customer...I voiced my concern about this once and they said they were thinking about going 2 tiered pricing because more than one of their commercial customers are complaining that it is hard to justify our mark-up when customer can see it online the price that we pay...... On COM I charge a $15/yard cut fee, that covers my profit loss using COM and if customer is not happy about that they can find another shop, although in my short time I havent had one walk away after i explain the policy

[Mojo]

Dennis, this scenario is playing out in many different areas. Look at sewing machines on E-Bay. Those sellers never see the machines and instead they are drop shipped to the buyer. It happens everyday across so many different industries.

It kills the Mom and Pop shops. I see why so many strip malls are vacant now. It will only get worse as the new generation which orders everything from clothes to music online becomes our next consumer.

Of course the medium to large businesses do not care as long as they sell....sell....sell.

Imagine what it will be like in 20 years.

Chris

[sofadoc]

I'm starting to notice JD's observation a lot now.

I've called a "new" supplier that claimed to be a wholesaler to check a price on an item. They kept transferring to someone else, until finally a guy picked up the phone, and stuttered and stammered a while before quoting me a price. I could tell that he was just stalling while he looked the item up online.

And like so many suppliers now, the price he quoted me was somewhere between wholesale and retail.

[gene]

There's a wholesale fabric store here in town that sells only to the trade.

They let my customers look through their incredibly big selection of fabrics. They call me with prices and availability.The last customer I sent there came to my studio to meet me after I had given them prices. They had at least 30 pages of fabrics printed off the internet - all name brand, and really low prices. Including the exact 2 fabrics that they had picked out.

IT seems that the only place where wholesalers have an advantage is with new, high end fabrics.

Chris wrote:

Fabric companies are selling seconds and thirds out their back door. Joe Blow shows up with a pickup and buys a pickup filled with rolls of seconds and thirds or cast offs and they then take it home and sell it on E bay or open up a store front. MiamiMike was telling me that this is going on big time now.

I think fabric companies are cutting out Joe Blow and doing this themselves under third party names.

The big question is how do you change with the changing times. How many buggy whip makers hung on year after year while Henry Ford was getting richer and richer?

gene

[sofadoc]

I think fabric companies are cutting out Joe Blow and doing this themselves under third party names.

I only believe EVERY WORD of that, too!

One of my suppliers even suggested a website to me that carries their line of fabrics. The fabrics were all listed at around 15-20% over wholesale. Why would my supplier steer me to a 3rd party outlet, unless they were in cahoots?

[west coast]

This is the latest move by the big boys to get more sales. I ran into this a few years back when I was manufacturing  mattresses as part of my business and was trying not to compete with the big 3 S`s. They  began selling returns and excess to wholesalers who operated out of temporary store fronts, garages, back end of other stores etc. I gave up and sold my equipment because the pricing they were selling for was below my cost although we were not comparing apples to apples the customer only cared about how much and was delivery included. I think some of what is happening today is the society we now live in is instant gratification and nothing has any value only a cost and todays youth know the cost of everything but the value of nothing. My employee that I had for over ten years that I had to lay off in the fall is now trying to scoop my Lazyboy work that I have done for over 30 years. Its true that if you have staff you are training your competition usually they are young and back to the value of nothing comment.