Question: Handling Unpredictable Orders
A Distributor Asks: I’m curious about how other distributors handle clients backing out of orders. It doesn’t happen often, but I have had clients request samples and place the order, and after I send over a proof, they back out of the order. I also have had clients request samples without ultimately placing an order. It’s not a big deal when it’s a small promo item, but when they request a couple of jackets or polos for sizing, it can be a little expensive. I don’t want to nickel-and-dime my clients, but at the same time, these seem like very avoidable and inconvenient expenses for me to eat.
I actually look at it as a cost of doing business.
A&A Specialty Advertising
Fort Myers, Florida
I view it as a cost of doing business, but on the other hand, I don’t let them milk me for free samples. Good, big customers always get free samples as part of the cost of doing business. For smaller or once-in-a-blue-moon customers, I tell them there is a charge for samples and freight, and once they order, I’ll credit the samples that apply on the order back to them on the invoice. If they want similar things and are somewhat serious, I’ll credit those back too. If it’s a somewhat expensive product—over $25—I’ll charge them for it or they can return it, and I’ll keep it along with other samples.
Calibre Sales & Marketing
Raleigh, North Carolina
We run into this sometimes as well, and it can be very frustrating. We always tell the client upfront there is a cost for the samples, but if the order goes through, we’ll eat the costs, but we want the samples back. We don’t mind having the samples here once they place the order, but if they don’t go ahead with it, we’re not stuck with $50 in expenses for an order we didn’t get.
Customers think they have the upper hand and can go anywhere, which they can. I’m upfront with my prospects and clients and tell them I’m not interested in being a quoting tool or creating unnecessary work for myself. Sometimes the client decides to go elsewhere, but an apparel order can turn into a lot of work for fairly thin margins. I tell my clients they also pay for my experience.
We ran into this when we first opened, when we didn’t have the policy written in clear language on our confirmation forms. Afterwards, we let our clients know there was a cost for samples and that any orders cancelled after placement would be billed at 60 percent of the noted confirmation cost. The document, once approved via signature or email, becomes binding. We’ve only had to enforce this policy once in almost eight years. We highlight and bold that the client should read and notate all information in the confirmation. It’s about covering your backside all the time.
Scott T. McCarville
Amplified Image Marketing
Set a policy, leave room for tailoring the policy on a per-client basis if need be, then be disciplined about following the policy. One client’s privileges may not be suitable for another. Your metrics will allow for you to make the distinction on which privileges you can extend. Follow a year’s spending habits with clients, then you can determine what sample budget you allow for the next year.
AB Unlimited Worldwide
Las Vegas, Nevada
If an order is cancelled before it has gone to the supplier and entered production, then no harm, no foul. We always inform customers that once orders have entered production, because they are custom, there are no refunds.
As for samples, the inexpensive promo items are just a cost of doing business. We always inform the customer if we can provide the sample for free, or if it is a more expensive item, what the cost will be for the sample. Customers don’t usually expect a more expensive product sample to be free.
For apparel samples needed for sizing, if the customer doesn’t order, often they can be returned to the supplier for a refund, minus a restocking fee. If they keep the garment(s), depending on the cost and quantity they received, they are usually required to pay for them.
Hi-Tex Flags & Advertising Specialties
San Antonio, Texas
I don’t send wearables without prepayment and shipping. I tell them the vendor won’t send samples at no charge. The costs can zoom up pretty quickly. By the way, they are not returnable. I have never had a client question it.
Judith S. Peacock
JHT Associates, Inc.
I present clients with a Term of Agreement that requests a 50 percent deposit. My terms also state that orders are processed immediately and cannot be cancelled once they are in progress. As for the samples: paying for samples and absorbing shipping costs is part of doing business unless, of course, they’re asking for something expensive and you’ll have to determine how much is too much for you. As for apparel samples, I first share samples I have on hand and try to sell the clients on those. Most of the time this works out fine. Once in a while, I get a client that wants a certain name brand or specialty item, and in that instance, you have to weigh how certain you are of receiving the order. If you’re feeling shaky about not getting the order, then tell the client you’re happy to order various sizes once the order has been placed and inform them that the sizes being ordered will also be embroidered.
TC BEE, Inc.
Plant City, Florida
It depends on how far along the order is. If we are past the acknowledgment of the order, with inventory pulled and proofs sent, there is a 20 percent restocking fee.
Custom Engraving Studio
When a client asks for samples and the item is not inexpensive, we bill them. We tell them when they place the order that we will credit their account for the sample.
Suzan Bolski, MAS
Anything Goes Promotions, LLC
San Diego, California
It’s always a balancing act. How much business is this person giving me versus how many free services and products is he or she requesting? It’s a cost of doing business. Sometimes the cost outweighs the benefits. Is the person using me and going elsewhere for a lower price? If so, I end the relationship.
Clemmons, North Carolina
Do You Have An Answer?
A Distributor Asks: So often I sell an order or work with a client on a promotion but don’t get feedback on how the product was received or what kind of results the company saw from the promotion. This is important information to have so that I can more effectively work with the company and to help me track how our ideas are working toward getting them the results they want. I’d also like to share some of these success stories with my suppliers—then we all win. How do other distributors get clients to share results?
What’s Your Answer? Email answers along with your name, title and company name by March 15 to Question@ ppai. org for possible inclusion in an upcoming issue of PPB magazine.
Danielle Renda is associate editor of PPB.