Episode 197: commonsku Turns 10!

[00:00:00] Intro: Welcome to skucast, the podcast for entrepreneurs in the promotional products industry. skucast shines a light on our industry's best work, features maverick personalities, and discusses what's really involved in running a modern promotional products business. skucast is the official podcast of commonsku.

[00:00:39] Mark: I think the joy that I get out of the business is hearing feedback from our customers as to the impact that commonsku has not only had on their businesses, but also on their lives. And I think for us, that has taken us aback.

[00:00:55] Bobby: commonsku's journey is a journey not just of a software company, but the journey of a [00:01:00] community and an industry.

[00:01:01] Today on the skucast, we are celebrating commonsku's 10-year anniversary, along with you, our wonderful friends and community. We're taking a moment to look back at the industry's growth and changes over the past 10 years, and in typical skucast fashion, we're not just looking back, but we're looking ahead.

[00:01:18] Catherine Graham, commonsku's CEO, and Mark Graham, commonsku's president and chief brand officer, join me to talk about their entrepreneurial journey, the struggles, the low moments, the high water marks, how the industry has changed, what they've learned about building a team, how leaders evolve and adapt, and we explore what it takes to build a bold, future-forward business.

[00:01:38] Hi, friends. I'm Bobby Lehew, chief content officer at commonsku. Before we get to our chat with Mark and Catherine, have you pre-registered for skucon? If you're new to the podcast, skucon is a conference for distributors and suppliers in the promotional products industry who want to connect, learn, and re-energize alongside other progressive, like-minded pros.

[00:01:59] But you [00:02:00] don't need just another business conference, and honestly, we're not interested in creating just another business conference. You need an experience that will revolutionize your thinking, help you find that inner grit, and challenge you to rise higher, go deeper, and reach further than you ever have.

[00:02:15] We are about to unveil the incredible speaker lineup, and I swear, it's like every year after each skucon, I think, "How are we gonna top that?" And I'll be damned if this isn't one of the most exceptional lineups of incredibly creative people. skucon will be held on January 9th in Las Vegas at the Keep Memory Alive Center again.

[00:02:33] Tickets always go fast. Pre-register at skucon.com so you can be one of the first to know when they go on sale. This episode is brought to you by commonsku, the work-from-anywhere platform that powers your connected workflow, enabling you to process more orders and dramatically grow your sales. To learn more, or to begin your free trial now, visit commonsku.com.

[00:02:54] Now, here's my chat with my friends and yours, Mark and Catherine.

[00:03:09] These past 18 months have been the most disruptive year and a half that any of us have witnessed. I mean, everyone knows this, but something that the three of us love to do is look at any disruption in the business, in the industry, through the lens of how does this impact us moving forward, not just what happened.

[00:03:28] But we do have to understand it in context. So Mark, how did you see business change fundamentally over the past 18 months?

[00:03:36] Mark: I think I saw three specific areas of major change with the distributors that we work with, and also distributors across the industry. Number one is that there was a fundamental change in how distributors sold and developed relationships with their end clients.

[00:03:52] I think that's a pretty obvious statement, because when you're not able to meet with your end clients in person, you're not able to collaborate [00:04:00] and do sales calls in person, you have to shift and you have to adapt. And it was really interesting to see which distributors really leaned into that versus the distributors that just buried their heads and kind of went into hibernation for a little while.

[00:04:15] But I think that the distributors that really shifted their approach were the ones that really ended up taking a lot of market share. So the change in how it is they went to market, how it is they sold, and how they embraced digital tools like Zoom and Google Meet and Teams was fascinating to see from our perspective.

[00:04:34] So that's number one. Number two was the sharpening of distributor value propositions, and I'll give you an example. There's a distributor, Joe Sommer with Whitestone Branding, who went through a really interesting change in the last 18 months. I think the first couple of months he was, like a lot of us, really shell-shocked and not entirely sure what was gonna happen with [00:05:00] the future of the business.

[00:05:01] And he took the time to really think about what value Whitestone offered in the marketplace, and did an entire brand refresh and put a ton of effort into their online approach with their website, their social media, and just this overall value proposition to their customers, and really emerged out of this, I think, a lot stronger and a lot more focused and a lot sharper as a distributor.

[00:05:30] So this concept of investing in marketing and investing in this honing of a unique value proposition. And then number three is, I think that distributors really leaned into finding new product and service offerings. There were a lot of the traditional ways that they were going to market that didn't work anymore, and their customers weren't buying the same types of products as before.

[00:05:54] I think the two best examples of this are in kitting, which a lot of distributors had to [00:06:00] learn on the fly and develop some pretty amazing campaigns, and then the second, of course, was e-commerce. E-commerce was dominant outside the industry and certainly within the industry, and those distributors that didn't have an e-commerce foothold really leaned into that, and that was exciting to see.

[00:06:18] Bobby: Yeah. Catherine, how do you see these changes that we've talked about changing our business fundamentally moving forward?

[00:06:26] Catherine: I think what was such an interesting kind of reminder during COVID — and particularly you think about March 2020, when everyone had to go virtual — that the emphasis on physical connection and, in that context, a lack of physical connection, that anything that could be done to make people feel as if they were still connected to their employer, to their customers, to whomever — the value of receiving those boxes, you know, with all the kitting projects that were done — like, the responses from people in that kind of environment [00:07:00] was extraordinary.

[00:07:01] And I think hanging on to what it is that that reaction created, and recognizing that even as we go back to being together in person or in offices or at events, there's still that emotional connection and that feeling that comes from surprise and delight, and ultimately the pride of wearing a brand and how you feel connected to a brand.

[00:07:24] I think the other piece that was a really interesting transition during this time was just the complete shift away from the inexpensive giveaways, and that was just a function of events being canceled — sports and conferences and trade shows and all the typical contexts where you're looking at mass distribution.

[00:07:43] And so this emphasis on curation, both in terms of product but also in terms of recipient, and how that then directly can be translated back into ROI. And that shift resulted in higher-quality products being used, and that plays right into where things have moved in terms of [00:08:00] changing buyer expectations, greater emphasis on sustainability and climate impact, and all the things that are just converging in terms of the trends over the past 18 months.

[00:08:10] Bobby: We're celebrating 10 years as a business, which also means we're celebrating the past 10 years as an industry. commonsku has run parallel to some of the most progressive changes that have happened in the business. So what's fun with a reflection like this is to go back and see the beginnings in light of how that has changed us still moving forward.

[00:08:29] So go back 10 years ago. Mark, let's start with you. commonsku was built for a reason. And for new listeners or folks that might be new clients or new folks in the community, they may not know the story, but commonsku was built fundamentally for a distributorship first. But I'm gonna let you answer this.

[00:08:46] Did it stay true to the original vision? How did it change as the industry changed?

[00:08:51] Mark: So to take it back right to the very beginning, we built commonsku as a business management platform for Rightsleeve, [00:09:00] the distributorship that Catherine and I ran for the better part of 20 years. And we started this in 2005.

[00:09:07] It wasn't commonsku back then. It was purely an in-house solution that we developed from the ground up specifically for Rightsleeve. And Rightsleeve's challenges at the time were very common across the industry, in that we were a fast-growing distributorship, and our systems were very inefficient.

[00:09:29] There was a lot of duplicate entry, there was paper everywhere, and we were really hitting a ceiling. And so we decided to build a purpose-built system for our business to help us grow and scale and sort of break through to that next level. Fast-forward five, six years, to 2010, 2011, we recognized that there was an extraordinary opportunity to reimagine the software and commercialize it for other distributors like [00:10:00] Rightsleeve — so effectively the whole industry.

[00:10:02] And we were very passionate about that, because we felt the problems ourselves. We knew how difficult it was to grow and scale a promotional business without good technology. And so we felt it was a great business opportunity, but outside of a business opportunity, we felt that there was a real opportunity to make an impact on this industry that we had really grown to love.

[00:10:28] And many people say that about the promotional industry. You get in, and at first you're like, "What is this crazy industry?" And then after a few years, you're like, "I love this medium. I love the people that are in this business," whether they're collaborators or competitors. And for us, this entrepreneurial motivation was part of it, but the other part of it was really trying to have an impact on an industry that had been so good to us.

[00:10:54] And so that is maybe a 30,000-foot view as to where commonsku started. But the [00:11:00] answer to your other question is that our North Star at the time — and it still very much remains our North Star to this day — is an incredibly efficient workflow management system that takes a distributor right from the very initial presentation all the way through to the final invoice, and all the steps in between, all entirely within one application.

[00:11:23] That was our North Star back then. It is our North Star to this day. But what has changed is the addition of things like e-commerce, and customer portals, and seamless integration with suppliers via PromoStandards. And those just name a couple of things that didn't exist when we first launched it.

[00:11:41] But we listened and learned from our customers and recognized that these things were important as the business evolved, and we wanted to make sure that we were a partner with our distributor customers right along the way. And so developing these new key features has made the business [00:12:00] incredibly exciting.

[00:12:00] But at the same time, I don't think we've ever lost our focus as to what our true North Star is and what we're absolutely the best at in the market.

[00:12:10] Bobby: Catherine, this is a question I love to ask distributors. Did commonsku customers shape commonsku, or did commonsku set out a vision and shape customers in the industry going forward?

[00:12:20] Or is this a chicken-and-the-egg scenario? Maybe another way of asking this is: commonsku's customers have changed through the years. I remember when I came on board, you could have knocked me over with a feather to know that we were gonna be doing shops in a few years, right? So there are some interesting evolutions happening.

[00:12:35] How much of that was forethought — changing the industry — versus working with distributors close enough to know what their challenges are and adjusting the platform accordingly?

[00:12:46] Catherine: I think it always has to be a combination of the two. I mean, you think back to the classic Henry Ford answer: if you ask people what they want, they would've said a faster horse. And so you need to have a vision around building the car. But at the same [00:13:00] time, you have to be totally tuned in to what the day-to-day experience is like for your customer and how their lives and businesses are evolving and changing. I think that where that future focus comes into play for us is that we are deeply tapped into the technology sector and what's going on in terms of advances in that area.

[00:13:20] But we're also paying a ton of attention to the end client and how it is that their needs are evolving, and therefore what it is that we need to provide to our distributors to support those changing needs. So I think it absolutely has to be a combination of those two things.

[00:13:35] Bobby: Yeah. Something we've all seen in the business is we've seen the complexity grow. It's gotten far more complex than it used to be, particularly over the past 18 months. The customer's gotten more sophisticated. The buyer's gotten more sophisticated. The brands that entered the industry several years ago, or a decade or more ago, have all elevated the industry.

[00:13:51] We have seen the industry, I think, rise and surpass many of the other mediums that are in the advertising world, but it's also been based on complexity. We've also seen this [00:14:00] breakdown of salespeople as the sort of centrifuge, or the central force, of the businesses, and then this sort of democratization, or this leveling, of teams working together more and more.

[00:14:12] So in many ways, the platform has been responsive, the community has grown, and you've seen this sort of interdependence far more, I think, than you would've 10 or 15 years ago. Am I wrong about that?

[00:14:23] Catherine: Yeah. I think what's also happened in parallel with that is that, over the past decade, there has been this incredible explosion of software-as-a-service platforms.

[00:14:33] And that ties into the democratization of tools that enable a team to be able to work far more efficiently. And our focus has always been: how do we give the distributor the flexibility to create a best-in-class modern tech stack that seamlessly integrates?

[00:14:52] And so being able to plug and play all the different pieces that are gonna be unique to their business, to help them grow and shape their [00:15:00] business, is a huge area of focus and will be an ongoing area of focus. I think what is so interesting in terms of how all those things are converging is that tools that in the past would've been completely unaffordable or unattainable without having a big tech team in-house to help deploy and manage — all these things are now available at the fingertips of an owner. And how it is that they can create this tech stack is just completely accessible in a way that it never was a decade ago.

[00:15:32] Bobby: So we have obviously a lot of entrepreneurs who are listening, and I think they're very curious about your journey as entrepreneurs — not only building Rightsleeve, but building commonsku as well.

[00:15:41] And in commonsku's journey, in 10 years, there were low watermarks, there's no question. So what were those struggles like? What were the impasses that you both faced, and how did you move forward? How did you find your path forward, Mark?

[00:15:57] Mark: So I reflect on the early [00:16:00] days of building the business as among probably some of the lower of the lows that we've experienced in our last 10 years.

[00:16:07] And it really just comes down to it being a perfect storm. Catherine and I had three young kids — our youngest child was less than two years old at the time. We were running Rightsleeve, which was a complex business with a number of employees that was growing, and we also were financing this capital-intensive business in commonsku that was very expensive and had a lot of personal stress and impact on us personally.

[00:16:40] Using the house as an ATM is something that I like to talk about back in those early years. And we were also starting a business where, even though we had a very strong vision and extreme optimism that we were solving a problem that was worth solving, [00:17:00] we also needed to convince customers to pay us.

[00:17:02] It was one thing for a customer to say, "Hey, that's a great idea," but then as soon as you ask them to open their wallet, they're like, "Whoa, hey, it's a bit different." And so all of those things really represented this perfect storm. And I would maybe add in that building the product — and reimagining it from Rightsleeve's internal piece of software to something that was enterprise-class and multi-tenanted (can't talk this morning) — was just something that you always project is gonna be quick and easy, but it always takes more in time and always takes more in cost.

[00:17:37] So add all those things together in those early days — it was stressful, to say the least.

[00:17:43] Bobby: Yeah.

[00:17:43] Mark: I think what got us through it is seeing customers sign up and subscribe to the software. The early customers — people like Danny Rosin and Robert Fiveash at Brand Fuel, Dave McLaughlin at McLoughlin Promotions, certainly our colleagues at Rightsleeve — [00:18:00] they became customers, and they were an incredible source of support and inspiration for us as we built the software, and their feedback was critical in helping us build the software.

[00:18:15] And we added people week after week after week, and that's what got us through this — when we saw that there was a real need for what we were doing, and that we were gonna make it out without bankrupting ourselves and having to move back in with our parents.

[00:18:29] Bobby: Right. Catherine, do you wanna add to that?

[00:18:31] What other struggles did you face that seemed like impasses at the moment?

[00:18:36] Catherine: I think, as two non-technical founders building a software company, there's always the challenge of what you don't know, and in those very early days, you're very dependent upon others to guide you in that process.

[00:18:50] And we certainly had our challenges with turnover in the very early days, and we're incredibly fortunate to have been able to attract and retain some [00:19:00] amazing talent shortly after that turmoil period, who are still with us today. So, you know, Michael, our CTO, and Robert, our lead developer, have been with us for almost the entire time.

[00:19:11] And so it's that kind of expertise and vision and guidance that helped us navigate through those beginning phases. And also just not being afraid to ask — in hindsight — probably pretty dumb questions. Like, now that we know as much as we do about building software, the kinds of questions that we were asking of our network and those around us at the time were pretty rudimentary.

[00:19:36] But that was just something you just had to get through. Like, startups are hard, and you can't just kinda start at phase 10. You have to start at phase one.

[00:19:46] Bobby: Yeah. Speaking of — so, you know, we all have kids, and when your kids grow, some folks will put them up against the door jamb there and mark their growth.

[00:19:54] And there are large periods of growth and short periods of growth, but mostly there are very large periods of growth. What were the high [00:20:00] water marks for you, Catherine? What were the "Wow, we've grown this much" moments, or what were the other high water marks? Maybe not in terms of volume, but just in terms of the change of the platform and the community.

[00:20:10] Catherine: I think the overall speed of growth has been the most surprising to me. You know, 10 years seems like a long time, but in the evolution of a business — particularly a SaaS business — it's not a long time. And so being able to see where we've come during that time period has been really exciting.

[00:20:31] And I think the other part of it is just the incredible joy that we get with the team that we have around us. Being able to attract amazing talent, and being able to work with people that care as much as we do every day — that makes getting up in the morning pretty, pretty awesome.

[00:20:50] Bobby: Yeah. Mark, how about you? High water marks, and then what joy do you get out of the business?

[00:20:56] Mark: I think the joy that I get out of the business is hearing [00:21:00] feedback from our customers as to the impact that commonsku has not only had on their businesses, but also on their lives. And I think for us, that has taken us aback over the years — that commonsku, this piece of software that we know is important, what it's allowed for our customers to do in terms of how it is that they run their business, but then accordingly the impact it then has on their personal lives, in terms of either financially, or more free time, or whatever the case may be.

[00:21:32] And just hearing back from customers over the years remains a profoundly humbling moment for us, and not something that we take for granted. I think the second thing is that just the caliber of the colleagues that we have attracted over the years is one of the true great joys of this business.

[00:21:56] Catherine and I have become quite specialized over the last couple of [00:22:00] years in our leadership roles, and just working with people that are so good at what they do is one of the reasons to get up in the morning, and to work alongside these people. And we're really lucky to have had a lot of colleagues that have been with us from almost the very beginning, and that's incredible.

[00:22:17] And we really learn from them, and we absolutely attribute any success that we've had to our team. I know it sounds cliché, but I really, really mean that.

[00:22:27] Bobby: No, I think that when you look back at a career, when you look at a business you've built, it's the cool things you've done together with great people that are usually the fondest memories.

[00:22:37] Catherine, what have you learned about building a team with a SaaS company versus a distributorship? You've done both. What are the differences? Are there similarities? For those of us that are now in this new phase of attracting and recruiting people — and there's this massive talent grab going on, there's lots of changes in the HR world —

[00:22:53] Are there differences or similarities?

[00:22:55] Catherine: I think that the similarities are that you always have the challenges of [00:23:00] attracting, retaining, developing talent. And regardless of what your business is, the people part of it is incredibly core to, ultimately, the success of the business.

[00:23:12] I think one thing that is maybe unique to software companies — and then maybe particularly unique to commonsku — is just the incredible complexity of what it is that we do and who it is that we serve. We've got many different stakeholders, essentially, that we are managing within the business —

[00:23:30] From our distributor customers, to our supplier customers, to the end users that everyone ultimately serves, to the team and all the products that go along with that inside the platform. So you think about the fact that we run events, we have an order management platform, we have an integration platform of suppliers.

[00:23:50] We've got shops, we've got all these different things that are just constantly pulling us in different directions. And so with that comes complexity of [00:24:00] team, having to manage all those different elements — and for me, complexity and having to keep my eye on a lot of different balls.

[00:24:05] So that's the fun part, but it certainly is a whole other challenge for me.

[00:24:11] Bobby: Yeah. Well, speaking of that, in any evolution of a business, the entrepreneur or the founder's roles should grow, should change, and should evolve. How have your roles — both respective roles — changed as the business has grown?

[00:24:24] Mark, let's start with you.

[00:24:26] Mark: I mean, at the beginning we did it all, right? And I think a lot of distributors listening to this, and suppliers listening to this, will be familiar with that stage — when you're the accountant, and you're the salesperson, you're the person defining the product.

[00:24:42] That's what it looked like for us in those early days. Product management, social media, sales, marketing, product testing, product design and development, hiring, managing a culture — all that stuff was really split between Catherine and myself in those early days. And as the business has [00:25:00] grown, each of our roles has become quite a bit more specialized, and — I mentioned this in an earlier answer — we've been able to attract people to head up specific parts of the business.

[00:25:10] So Michael, our CTO; Kate is our VP of Marketing; Aaron heads up our customer success; Sam Kates is our head of sales. It's kind of mind-boggling to think that we were basically doing those things ourselves 10 years ago, and now we're a lot more specialized, and a lot more, probably, strategic — thinking about the future of the business —

[00:25:31] As opposed to minding the day-to-day. I still think that there's some day-to-day, there's no question, but certainly way less of it than in those earlier days. And transitioning to that, I think, has been really fun. It's not been without its challenges, right? Because you like to get involved in the day-to-day.

[00:25:49] But it's been a fun journey, for sure.

[00:25:51] Bobby: Well, I think for any entrepreneur, you love what you've created, and therefore these sort of gradual steps in growth and evolutions are not as easy as they look on [00:26:00] the outside, but they're imperative. Catherine, how has your role changed?

[00:26:03] Catherine: I would say, as the team has grown and different responsibilities have been removed from my plate, it's given me the luxury of time to work on the business.

[00:26:13] And I think that could not be more important now, as the industry as a whole is going through this incredible change, and the world's going through this incredible change, and ultimately what that translates into in terms of where we need to be as a business five years from now — like, that's where we need to be spending our time thinking.

[00:26:31] And so having an amazing team that can be moving forward all the other elements of the business is just so incredibly valuable to me in terms of what that frees me up to do.

[00:26:43] Bobby: Yeah. Let's go back to the future for a minute. If you had to both define the most important priorities for a distributor and supplier to build a bold, future-forward business, what would that be?

[00:26:55] Mark?

[00:26:56] Mark: I think it comes down to three broad areas. The first is [00:27:00] to build a business — and when I say a business, I very much think that this applies to starting a distributor company or a supplier company — so, building a business with a strong area of specialty and a strong market niche. That is very, very important, and I think a lot of distributors and suppliers will start out and they're trying to be all things to all people.

[00:27:26] That, I think, initially is a very attractive approach because, of course, we sell promotional products — there's lots of people who want promotional products, and as a result, you can connect the dots. But I think what happens when you take that approach is that you then become a generalist, which then means that people don't value you as much as if you were a specialist.

[00:27:48] And so staying disciplined, and staying focused, and turning down business that doesn't fit your focus, is something that will pay huge dividends as you grow and scale. That's number one: strong [00:28:00] area of specialty and market niche. Number two is, I think it's essential to have a strong opinion about your client's business.

[00:28:09] I credit this piece of advice to an advertising executive that I had as a mentor many years ago. And I remember he said this to me about how it is that their advertising firm goes to their global clients. And he said, "It's essential to have an opinion about your client's business and the problems that they're dealing with."

[00:28:29] 'Cause if you have that opinion, and you're confident in that opinion, they're gonna listen to you, and they're gonna pay a premium for that — as opposed to being the person who says, "Hey, I have a bunch of stuff. What do you think?" And what that then does is it shifts who is in charge. And now the client is in charge, and I think the dynamic then changes with regard to what it is you can charge and how it is they value you.

[00:28:53] So having a strong opinion about your client's business, about their industry, about the problems they're facing, and how it is [00:29:00] that you can specifically solve them, is the sign of a truly first-class distributor and supplier. And then number three — and Catherine and I speak from personal experience here — is building a business that stands separate from you as the owner or owners.

[00:29:17] There are a lot of suppliers and, I would say, probably more distributors in this particular case, that build businesses that aren't really worth very much unless the owner is there. Effectively, what they're doing is they're building a book of business based on a book of clients, and when they go to sell the business, what they're really doing is selling themselves — and they've now sold themselves into a job at the acquiring distributor.

[00:29:43] And there's nothing necessarily wrong with that, but I think that the really interesting opportunity for financial independence in this industry is if you start a business and you can sell it, and it's separate from you, the founder and the owner. So that means investing [00:30:00] in systems, investing in processes, investing in a brand that can stand on its own two feet, because that's what an acquirer really, really will pay a premium for.

[00:30:10] And again, that's tough. That means investing in things that are longer-term investments. But at the end of the day, if you do that and stay disciplined, it can certainly bear a lot of fruit down the road.

[00:30:24] Bobby: Catherine, what would you recommend?

[00:30:27] Catherine: I'd use a classic hockey analogy here in saying: skate to where the puck is going.

[00:30:32] So you gotta look at how the end buyer's needs are changing, how it is that the way they want to buy and engage is changing — and this isn't the classic "millennials are the new buyer." The buyers of any age have dramatically changed how they want to engage and interact, and what it is, ultimately, they're looking to solve in terms of challenges.

[00:30:53] So we've gotta be constantly moving forward on that and thinking about what the next few years look like [00:31:00] from that perspective. And the other side of that is to be constantly thinking about how it is that you can add value — and that is changing as well in terms of additional services, whether that's things like kitting, being a great example of the evolution of the way that adding value has changed.

[00:31:20] So, constantly thinking about how you continue to move forward on that. And for suppliers, I would say that the "skate to where the puck is going" is just looking at the supply chain, which is moving so fast right now — in terms of not just the challenges, obviously, but where things are being produced and what kind of materials.

[00:31:41] There are a lot more options, I would say, opening up as the world is quickly evolving, and the impact that has happened with relationships with China, with the overall issues on that front, that I think it's an incredibly [00:32:00] interesting time to be in the manufacturing game — and what opportunities that presents in the next few years.

[00:32:07] Bobby: As we're recording this right now, supply chain is the biggest topic, the biggest challenge for everyone on the supplier and distributor side. Are there core fundamental issues? I mean, you have wrestled with supply chain from the beginning — both of you have. You've been at the crux of this. Are there core fundamental issues that we still need to address as an industry to really leap forward in a much more dramatic way?

[00:32:29] Catherine?

[00:32:31] Catherine: Yeah, I think what's been a crazy whiplash experience over the past 12 months is that everything had been moving towards highly nimble, print-on-demand, much more flexible offerings, in terms of being able to be responsive to client needs.

[00:32:51] And what's gone on, particularly within the past six months, moved things in completely the opposite direction, where everyone is focused on: [00:33:00] where can I find deep inventory? How do I get some more predictability, where I can present options with confidence to a client?

[00:33:07] And know that when I go to place that order, that inventory's still gonna be there. Like, all these things that have been shifting sands beneath our feet over the past six months — and it's probably gonna only get worse over the next quarter heading into the end of the year.

[00:33:22] And hopefully we start to see some improvements beyond, as things even out. But ironically, what that has done is it's almost shifted things back in the direction, for distributors, of holding inventory for clients, and being able to have that predictability of being able to deliver on what the client needs.

[00:33:41] And, I mean, that's a big reason why we launched inventory shops a month ago — being able to create flexible, easy solutions where you can spin up an inventory program quickly and wind it down quickly, as opposed to having to think that that's only applicable for these very, very large programs.

[00:33:57] Mark: Yeah.

[00:33:57] Catherine: So, just being able to bring that [00:34:00] nimbleness and flexibility that's not as available on the product side anymore into the solutions that you provide the customer.

[00:34:06] Bobby: Yeah. Mark, how about you?

[00:34:08] Mark: I think what I would add to that is a reminder that it's still very, very important for distributors to think and plan proactively with end clients.

[00:34:19] This is certainly not a new piece of advice, but this concept of understanding what's coming down the pipe for your end clients remains a classic piece of advice, and it's one of the best ways to manage this inventory crisis. Because if you're planning something that is creative and interesting well in advance, and you're able to partner with a supplier to plan production accordingly, then that is one of the best ways of dealing with this — as opposed to waiting till the last moment, when the client's like, "Hey, I need some stuff for next week.

[00:34:54] What can you get for me?" That's where our reliance on this just-in-time inventory with our [00:35:00] suppliers has really been called into question. To be clear, given that we were distributors for almost 20 years, we understand that those last-minute requests are gonna happen. We're not all perfect. But I think in those cases, distributors just have far fewer options these days to supply product just in time, because of the supply chain crisis.

[00:35:20] So I think we just have to adjust our expectations and adjust how it is that we're managing these client opportunities. And I think it's a great opportunity at the end of the day.

[00:35:27] Bobby: Yeah.

[00:35:28] Mark: Educating the client, letting the client know that inventory's a challenge, and the good old days of being able to wait a week before the trade show — maybe they're over. But that's not necessarily a bad thing, from the standpoint of how it is that we can help our clients with their budgets and with their products, that may be better designed at the end of the day.

[00:35:48] Bobby: Yeah. You are both always so optimistic about the future. Even I can say that I think our industry's best years are ahead of us. And when I say that, I mean, any time we've had a massive disruption in the industry [00:36:00] like we have had over the past 18 months, typically the industry changes fundamentally — if we make that shift and if we make that change.

[00:36:08] When you look at what's happened, because of the disruption of everyone working from home and having hybrid workforces, we've been forced to work on better communication with our teams, building better tools, harnessing better tools, just working better with our teams. We've actually been forced to sell better to our clients, to rely on a UVP and not just showing up and being friendly.

[00:36:28] We've been forced to do many things — focus on our operations and supply chain. Over this past year, you could argue, many of us had to dig into our operations more than we used to in the past because of these challenges. So when you swirl a lot of it in a blender, and you realize that there are tons of changes and there is a new cocktail moving forward: how can we harness these changes for the better in the future, as opposed to just going back to the way we used to always do things?

[00:36:54] Catherine, let's start with you.

[00:36:55] Catherine: I mean, to that last point that Mark was speaking about, in terms of clients needing to plan [00:37:00] further ahead — let's continue managing those expectations, that the more time that is given to a project, the better the outcome. And not just because of the immediate inventory challenges right now, but what it is that that enables in the future in terms of creativity of solution.

[00:37:15] So continuing to lean into that would be a great outcome of this.

[00:37:19] Bobby: Yeah.

[00:37:20] Catherine: I think the flexibility that has come with working remote is enabling people to hire talent in areas where they never thought they would before. And I look at our team as a great example of this. We've always had remote people since the beginning of the business.

[00:37:37] But more recently, you know, we just brought on Alison, on our customer success team, who works out of New Brunswick. And Anna just joined us in Denver. And so being able to have that amazing flexibility to find talent wherever they are, and not have this notion of "we all have to be in the office to be successful" — how do we continue to leverage those learnings that have been had over the past [00:38:00] 18 months in particular, to be able to really grow the talent on our teams?

[00:38:04] Bobby: Yeah. To that point, I had a distributor friend and commonsku customer reach out to me yesterday and say, "Hey, I have a key person that's moved to your market. I think we'd like to open an office there. What can you share with us about the market and everything?" And you look at before — you would lose a person, you would lose that talent.

[00:38:19] And now, given the landscape and what's changed, there are no geo-specific businesses anymore. You can do business from anywhere, you can recruit from anywhere, and that reality is happening as we speak for many of us, regardless of our size.

[00:38:33] Mark: I think I'd add just one more point to that, which is that I think we would all agree, over the last 18 months, the respectability of our medium —

[00:38:43] To use a phrase that, Bobby, you coined — the respectability of merch — has never been higher, because our industry has faced all these constraints with regard to production and tightened budgets. When your budgets are tight as an end client, you're expecting [00:39:00] results in a way that you might not have when the budgets were a little bit more loose and it was the go-go days.

[00:39:04] And we've talked about that many times over the last 18 months, Bobby, you and me. And what I hope is that we can continue to ride that wave and then build upon that, as opposed to going back to some of the maybe poorer habits of our industry, which is the "Hey, we can produce that for you in 24 hours, so you can wait until the very end."

[00:39:28] Or approaching projects with a transactional viewpoint in mind, as opposed to a solutions-oriented approach. And so I think that our industry has been given a gift with regard to how it is that end clients see our medium, and I really hope that we don't squander that muscle that we've built as an industry.

[00:39:51] Because sometimes it's tempting. You're a distributor and you're like, "Well, that's a little bit less work for me — to think creatively — if I can just [00:40:00] go and sell that transaction. And I can go pump out that 50,000 widgets without really thinking about it." And I hope that doesn't happen, because I think if we're able to embrace this solutions, creative-oriented approach, it's gonna put us on the path to double the size of the industry.

[00:40:18] And Catherine, we talked about this at commonsku Sessions two years ago: the opportunity is not to take business away from each other. The opportunity is to increase the size of the pie, and we firmly believe that this industry could be double in size in the foreseeable future. So let's do that, and let's not squander this opportunity.

[00:40:38] Bobby: Well, Catherine, Mark, I know I speak on behalf of the team when I say it is a blast working with you and building this business. I mean, it truly is. Everyone on the team is passionate about this, and I know I speak on their behalf when I say thank you for building such a rewarding opportunity for all of us, for the community.

[00:40:54] I also know I speak on behalf of the community when I say thank you for what you guys have [00:41:00] done. You're doing this Canadian thing right now where you're, like, backpedaling, trying to get out of the camera and the spotlight. But I wanna say it has been an absolute joy and privilege, and it's been fun not only to watch commonsku grow, but to watch how much you have challenged the industry — and you challenge us to this day.

[00:41:17] So thank you very much.

[00:41:19] Mark: Thank you.

[00:41:19] Catherine: Thank you to everyone that's allowed us to be on this journey.

[00:41:22] Mark: Here's to the next 10 years.

[00:41:22] Outro: Thanks so much for tuning into this episode of skucast. Be sure to keep up with our latest content by subscribing to skucast on iTunes or to our blog at community.commonsku.com.

[00:41:37] Until next time, friends. Thanks so much for listening.