Locate the Market for Screen Printing Caps

screen print cap

Surveys indicate that caps are the 2nd or 3rd largest selling item after shirts.  Caps
can be an opportunity to increase your screen printing sales and profits.

Selling prices vary widely for caps.  Some sell for about $30, and even the
old mesh back, foam front caps that used to sell for $3-$5 now are being marketed
as “trucker caps” selling for $15 and $18.  These foam fronts
cost under $1, and the 5 and 6 panel caps cost $2-$3.  So there is plenty
of profit potential from caps.

Ask a college student or a teenager what they paid for their cap, and you will probably
be surprised to hear prices that are much greater than are paid for shirts.  The
potential for high profit margins makes caps a product to be investigated.

Companies buy caps for all sorts of reasons.  Hygiene laws require occupations
like food handlers and medical product manufacturers to wear caps.  Soiled
caps get discarded rather than washed.  Restaurants have employee turnover
and need new caps.  Companies like UPS want to project their image, and
the local UPS manager has the authority to buy locally.  Power, gas and
water meter readers need caps so homeowners will not be alarmed by a person
in the bushes at the homeowner’s house.  A company might provide
caps as a morale booster, safety award or advertising bill board.  Companies
have lots of reasons to buy caps.

The cap market is actually a collection of market segments.  The cap
an individual will buy for their own use depends primarily on their age.  Companies
buy based on use.  Knowing the buying habits of individuals and companies
gives the decorator the opportunity to maximize the selling price and order
size.

A Person’s Age

Students typically pay the highest prices.  That
price could be $12-$30 per cap.  However, their parents might only pay
$8-$10 for a cap, and the grandparents might only pay $5-$6.  So age is
the first clue to who pays the highest prices.

Although we recognize people by age, the actual differences are self-esteem
and cost.  To students, wearing the right fashion or look in a cap is
very important.   Young people still growing are concerned about
their self-esteem.  The “right cap” identifies the young
person with their peers.   Only a 6 panel cap is acceptable for
many of these young people.  For a youngster on a skate board, however,
only a foam front  typically worn crooked on their head communicates with
friends that he is one of them.

Students frequently get the money to buy the cap from their parents and therefore
are less cost conscious about price than parents who have to earn the money
before the parents buy a cap.  So students will pay more than their parents.  Grandparents
are the least fashion conscious, and most cost conscious, because they are
retired on fixed income and are the least concerned about what others think
about how they look.

To find the student cap market, we first need to find what interests students.  Their
school, team and images that unify students are good places to start.  During
basketball season a basketball with the name of the team written through the
basketball can be very simple and striking image that conveys a clear message.  The
same approach can be used for all sports.  Artwork that students consider “cool” will
convert compliant buyers yielding to group norms into compulsive buyers who
have to have that cap.

The market segment for the cap can be clearly identified
to minimize sales time and cost.  The school will have a class president, student athletic
association or similar organization that can take pre-paid orders as a fund
raiser using a sample decorated cap put on display.  The same image can
also be offered to older alumni who order the 5 panel cap on a pre-paid basis.

This form of marketing can be extended from a school class or sport to events,
tournaments or any occasion that brings students together.  In each  case,
the sale should be to the students with the students’ agent acting as
your sales agent in return for compensation.

This method of selling allows using a retail price students will pay.  That
price can be determined by seeing what students pay at the shopping mall, or
by asking them what they have paid.  The decorator will yield a much higher
selling price by selling direct to students with a  discount to the sales
agent than by approaching the school administration that does not have funds
budgeted for caps and which would solicit three competing bids.

To sell to parents, we again need to find what interests them.  That
could be golf, fishing, hunting, team sports, patriotism, and a variety of
other themes.  Using golf as an example, golf caps sold in the pro shop
at a public golf course will command a high price with half of that price going
to the pro shop as their mark up.  The selling price should match the
prices being charged currently in the pro shop.  The net selling price
received by the decorator times the number of caps produced per hour will show
this market segment to be more profitable than shirts.  Group and tournament
sales are the best way to get established at golf courses, because custom decorating
that is not in the store inventory will be what the group wants.

A Company’s Use

Companies are not driven by self-esteem, but
rather a corporate purpose and cost.  The purpose might be part of the
entertainment of customers and high priced staff where the corporate image
is more important than cost.  In most situations the cost is an important
consideration, and the decorator may be faced with competing bids.

Marketing to corporations is more complicated than students.  First,
who makes the buying decision?  In a corporation that could be any one
of a number of people.  The Sales Department  may want caps for customers.  Human
Resources may want caps for a group outing.  Production might need to
keep hair out of products.  Requirements like these might be fulfilled
without going to the Purchasing Department.

A purchasing department will be more driven by getting the lowest cost than
the other objectives of the requisitioning department.  A large company
with lots of employees can have numerous potential buyers of caps.  So
understanding the decision making process is important.  Then, once a
decorator knows who to talk with, who has to approve the purchase?  At
each level of approval the caps have to be sold again to finalize an order.

Decorating a sample cap to persuade each person in the approval process is
a measured gamble.  Buyers frequently cannot visualize the product they
are being asked to buy without first seeing one.  A decorated sample of
exactly what the customer will receive can be a strong “closer” to
a sale when the motivation to buy already exists.  However, creating art,
and going through all the other steps to produce one cap is expensive.

Therefore, decorating samples is probably an unwise business decision, unless
you know the sample is being presented to the decision maker(s) and the decorated
sample will substantially improve your chances of getting an order.  When
these conditions do not exist, similar decorating for other customers should
be used.  Those samples may also serve as endorsements by other companies
of the decorator’s capability to produce excellent work for the sales
prospect.

So the starting point with corporations is finding out what their plans are,
and how caps fit those objectives.  Company representatives may have never
considered using a cap to meet their objectives.  Certainly many products
are promoted on caps.  Just watch a golf tournament on television and
almost every golfer is wearing a cap promoting something.  Local businesses
can do the same, and get financial aid from their suppliers that provide coop
advertising money to have their name or brand on the cap.

Easier is going to companies known to use caps, and then displacing the current
supplier.  To displace another supplier the offering will have to meet
or exceed the conditions of the order.  We all think of price as a condition
to an order, but often other conditions are more important.

Many corporations are image conscious, and want the image on the cap to match
the sign at the entrance to their business, stationary, packaging and sales
literature.  That means colors must match PMS standards.  The font
or logo must be a photographic duplicate.  If you can meet this condition,
and the other supplier cannot, then you have a better offering.

Other conditions can be your proximity to the customer, how fast you deliver,
the personality of the sales person, or help you provide to improve the art.  To
find out what conditions are important to the customer, ask.  When sales
prospects talk about past purchases they will frequently reveal important conditions
that were not met well by another supplier.

After the customer has spoken at length about the execution of prior orders
from art preparation to delivery, and you have asked questions about the order,
then ask, “and by the way, what did you pay?”  If the price
was too low, you will have to justify why your price will be higher.  If
the price meets or exceeds your expectation, then you will know to charge what
the other supplier charged, and take the order based on conditions other than
price.  You want always to leave open the opportunity for higher prices.

Notice that no mention was made of contract decorating.  This market
segment requires substantial production assets that many shops do not have.  Also,
contract work usually results in low prices for the decorator and less than
optimal pricing for the middleman.  Financially you will do better eliminating
the middleman and drawing your own conclusions about what price a customer
will pay.  Contract work can also mean competing with foreign production
where labor rates are very low and employee benefits are even less.

Conclusion 

When surveying local decorators you will most likely
find all the decorators – people with transfer machines, screen  printers
and embroidery shops – are decorating shirts, but few sell many caps
by comparison to shirts.  Caps are not as competitively priced as shirts.  Decorating
a cap is different from a shirt, and there is a learning curve to climb.  However,
the rewards can be substantial.

Caps can be that opportunity you are seeking to make this year a better year
than last year.