The ABCs of Company Stores

If you’re in the promotional products, apparel or incentive business, you’ve probably come across the term “company store”. Despite what the lyrics to the traditional folk song might claim, the modern company store is not a place where coal miners sell their souls.

Instead, a company store is a specialized e-commerce web site where customers buy branded merchandise, redeem rewards or fulfill marketing and identity materials.

What a Company Store isn’t

That’s quite a mouthful, so let’s break it down. First, it might be helpful to talk about what a company store is not. A company store isn’t:

A consumer e-commerce web site: Traditional e-commerce stores can be set up with any number of service providers or software, including ShopifyVolusionMagento and even WordPress.

These stores are often well-suited for consumer and even business-to-business e-commerce, and many of them can deal with complexities like apparel colors and sizes and multi-state sales tax requirements. However, they don’t have all the cost control, approval and redemption features that company stores normally require.

A distributor e-commerce web site: Many promotional products or advertising specialty distributors have large e-commerce web sites with thousands of products, where customers can place custom orders for just about anything.

These sites are available from companies like SAGE, ASI or Distributor Central and cater to consumers and businesspersons looking for a product or two to customize and order. Company stores are much more specialized, generally with a smaller selection of products.

What a Company Store is

Instead, a company store is built to handle the special needs of a number of different situations. The use of the word “company” in company store is your first clue: Very often (though not always), a company store sells branded merchandise, marketing goods or incentive products for a specific company.

Instead of you ordering 100 golf shirts with your company’s logo on it when you need it, the company store will have 30-40 products (including the golf shirts), all with your company’s logo (or logos) on them.

The consumer of goods in a company store is, often, that company’s own employees. They need a t-shirt to wear to a company picnic; a polo for the next trade show; a hat or uniform to wear on the warehouse floor.

And for some companies, a store can be more like a “fan” store – employees and customers want to show off the brand with a coffee mug or backpack.

While no two company stores are the same, many of them share similar features:

  • Smaller product selection: Most company stores have anywhere from 10-100 products. Instead of offering 30 different travel mugs, the company will choose the one most appropriate for their budgetary and branding requirements. The final selection of products is often quite limited.
  • Personalization: Company stores often allow customers to select from an approved set of logos, or to add their name to the chest of a shirt. Many can also customize printed materials like business cards (often called “web-to-print”).
  • More payment options: Most e-commerce sites take credit cards (a few take crypto-currency but they are fairly rare) and not much else. Company stores often include a variety of payment methods, including purchase orders, departmental budgets, reward points, or even no payments at all (think a uniform program where employees just have to pick out their style and size).
  • Corporate requirements: Since company stores are often run for, you, know, a company, that company will have specific rules or needs for purchasing items. Many companies only want employees to be able to log in and purchase, often using single sign on (“SSO”) or “punch out”; others only make certain products available to different groups of people (think department-specific products).

There is no typical company store program

Yes, a lot of company stores have a set number of products customers can order, often inventoried in a fulfillment warehouse or ready to be decorated and drop-shipped. But a company store is much more versatile than just that. Here are a few more popular uses:

  • Reward Programs: These programs reward things like attendance, tenure, safety or simple tasks like helping coworkers. Reward programs can include branded items, high-value incentive items (like electronics), or both.
  • Points Stores: Rewards programs are often points programs, and vice versa. But a points store is good for any program where customers don’t want to use currency. Points can be given to users in a variety of ways, then they can bank the points and buy whatever they want.
  • Popup Stores: Popups are short-term stores for time-limited programs like holiday programs, group purchasing, team apparel and uniform purchasing. A popup runs only a month or two, but many of them run at the same time every year. They’re a fantastic way to inexpensively handle any short-term sales need.
  • Micro Stores: Company stores have the unique ability to serve up customized products and content based on groups of users. Your client may want a different set of products or logos for each of a dozen locations. Micro stores allow you to set up a custom experience for each audience without having to pay for a dozen stores.
Colorful apparel dominates company stores sales

What do they sell?

You want numbers? We’ve got them:

  • Roughly half of all company store products are apparel (this tracks reasonably close to the industry overall)
  • 30% is promotional products
  • The rest is mostly printed materials: Business cards, postcards, brochures, banners and so on
  • The average order size is $292.00
  • 66 percent of distributors who operate company stores operate two or more of them

Most popular promotional products, in order:

  • Office and desktop items
  • Holiday items
  • Writing instruments
  • Recognition and rewards
  • Drinkware
  • Bags and totes
  • Golf and sports
  • Hats and caps

Great. What’s in it for me?

You’re probably saying to yourself, “These sound neat and all, but it’s new and scary and I don’t have time for it. Why would I do these when I can just sell my client hard goods or apparel a few times a year like I always do?”

Reasonable question. And very often you don’t have to sell these at all; in fact, your client may come to you demanding one. Many company store programs are initiated by the corporate client – they’ve decided they need to centralize or control the purchasing of the goods (sometimes with procurement systems like Coupa, Ariba and others), or they want to buy in bulk but fulfill in small quantities.

In this situation, you often run the risk of losing the client entirely if you’re not prepared to handle their company store program. So, it’s good to have some idea of the nuts and bolts before you answer that call or email.

But company stores don’t have to be big, high-dollar programs with gobs of inventory and overhead. And that’s where you might want to bring your selling skills to bear.

Creating lock-in

Selling promotional products and custom apparel has always been a relationship-oriented business. Since the other 99,999 distributors out there can acquire the same goods as you, your skills as a salesperson, product expert and customer service professional can all help keep a client with you for years.

Company stores are another way to lock your clients in. You can set up contracts, purchase commitments and other long-term agreements, but more importantly, a company store is going to provide tangible benefits for your client that they might not otherwise get in the normal sourcing-ordering process with you.

Here are a few benefits that will appeal to managers, marketers and bean counters alike:

  • Cost control: Most company stores have advanced features to control spending by users, groups, departments and much more. The benefit? Money saved for your customer.
  • Product access: Many companies don’t want everyone to see everything. Managers might be able to buy more products than regular employees. Company stores allow your customer to tightly control who can buy what. The benefit? Complete control of product purchasing.
  • Quantity discounts: Many customers think company stores are for pre-decorated products stored in a warehouse. But most companies now use them to buy larger quantities of drop ship products, and most company stores can handle both kinds of purchases. The benefit? Cheaper products for your customers when they buy custom products in quantity.

How do I market them to my clients?

We’ve put together a few selling tools, like Powerpoint presentations and emails you can customize for your company store opportunities – they’re all available on our Resources page to download for free.

For many opportunities, the most effective selling tool is asking your company store provider to build a custom demo for your customer. A custom demo is a fully functional store with your customer’s logo and information, stocked with sample products. Custom demos sell programs more effectively than anything else:

  • It gives your customer a visual idea of what their store will look like and how it will work, which is always going to be more effective than you describing it to them
  • It allows your customer to walk through ordering processes, payment, inventory and other multi-step features which are, again, pretty tough to describe verbally.
  • It becomes a selling tool for them to get buy-in within their organization – they can send colleagues to the store to check it out at any time.

The process

How do you get a store going? First, let’s step back a little bit, because before you sell and set up your first company store, it’s a good idea to know what questions to ask.

Six questions about requirements

“Requirements” is a fancy way of saying “what does the store need?” When you sit down with a client to talk about a company store, it’s helpful to ask them a few questions about their needs.

Obviously, this can get very detailed with big clients and complex programs, but a few simple questions can speed the process along. Asking these questions up front will also save a lot of time when you go to your friendly company store provider and ask them to set it up.

  1. What does it need to look like? Is your client a “pixel-pusher” who needs tight control over branding and will nitpick until it looks the way they want? Or will they be happy with a basic template with their logo at the top? You probably already know this if you’ve been working with them, but it’s helpful to show them some examples of custom sites and template sites (and the associated costs) so they can make an educated decision.
  2. Who are the customers? Is it all employees? Can the general public buy products? If only certain people can buy, how do you want to verify that they’re legitimate buyers? Talk about real people and what they need to able to do. Don’t worry about abstract ideas or groups. Individuals will work at this stage.
  3. . What are you selling? Your client may already have an idea of the products they want in the store. Talk about a few real products and the options and customization they would like on them. Ask them if they want these products immediately available (inventoried) or drop-shipped in minimum quantities. Many stores handle both.
  4. Which products can customers buy? Are there any restrictions on what people can buy based on their role, department or position? Do some or all users need to have their orders approved? Walk through a few typical orders with the client. Following the story will often answer the questions.
  5. How can they pay?This is often the trickiest part. Nearly every company will take credit cards, but beyond that the options are almost limitless. Some companies want budgets, debit accounts or even payroll deductions. Others charge nothing and just fulfill gifts or required items like uniforms. And often different groups of customers may have access to different ways of paying (an employee pays with credit card, but a manager can access a budget, for instance). This is where you go back to #1 (“Who are the customers?”) and walk through how those users pay and, if necessary, how those payments are routed or approved.
  6. What reporting do you need? Company stores generally include a ton of built-in reports, from sales to product mix to inventory value. Still, that’s sometimes not enough. A customer may want custom reports, or they may want additional information from you on a weekly or monthly basis. Other customers may not care about reporting as long as no one complains. Ask your client what they want to know about store performance.

The, ahem, process

Here’s the thing about all those questions above: It turns out that they also describe most of the process for setting up a company store. There are a few other niceties, but when you set up a company store, you’ll more or less follow the above steps for most of what you do.

What else do you need to keep in mind? Here’s the timeline of a company store program, from soup to nuts.

1. Gather requirements

See above. Ask questions, get answers. Dig deeper where you need to. Collect all this info and package it up in an email or document. Sometimes this will come to you fully packaged in the form of an RFQ from your client.

2. Bring it to your company store provider

There are a few of them out there, including us, SAGE, ASI and a few others. Ask them for a quote and give them the information you’ve collected, including your thoughts on the design of the store (e.g. template or custom). While many company store providers have standardized pricing, it’s always good to present them with everything the client asked for, in case there are customization fees.

3. Present the quote to your customer

You may elect to mark this up, or pass the cost on directly to your client. If you’ve got good margin and expect decent volume (or your customer has committed to volume), you might even absorb the cost of the store itself (for more information on what you should do with company store fees, check out our ebook on the topic).

4. Sign the contracts

You’ll be signing a contract with your provider, and one with your customer. Make it as long term as they’re willing to go.

5. Source the products

Work with your customer to build the product catalog and options for the store. This is also the time to get fulfillment set up if you’re not doing that in house.

6. Get trained!

Your provider will train you on how to enter and manage products. Take advantage of that time, and ask lots of questions. This is also often when the provider will set up the design/template for you.

7. Set up products, e-commerce options, users, shipping and reports

This is the fun part: Building your product catalog, setting up your payment options, merchant accounts, freight carriers and so on. Lean on your provider to help you get this done right.

8. Review and launch

Once you’re happy with it, send the site over to your customer for review. Work out any data issues, and make sure everything works the way they expect.

9. Run it

After launch, your work isn’t over. You obviously have to operate the store and fulfill orders. But you should also engage in marketing the store and its products to make it a success. While some company stores will chug along with little help because of demand, others need your deft marketing hand to keep products moving. Don’t be afraid to suggest freshening up stale products and clearing out old ones.

Ready for more?

Here are some resources you might find helpful:

  • ABCs of Reward Stores: The lowdown on points, rewards and incentive programs.
  • eBlox Blog: 10+ years of Identity Marketing magazine articles, in-depth feature discussions and more.
  • SAGE Blog: Great general resources on promotional products and technology.
  • Counselor: ASI’s online magazine for ad specialty industry professionals.
  • PromoCorner: Articles, videos and news for the industry.
  • Resource Center: Lots of educational materials, presentations, videos and general training stuff to help you sell and manage company stores.