The Small Business Black Holes with Alan Pentz

Building an Outsourced Fulfillment Empire in the Promotional Products Industry

Jun 18, 2024

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The episode begins with Josh explaining the promotional products ("swag") industry dynamics - how suppliers provide the same products to a sea of distributors who then brand and resell those products. He outlines the challenges of differentiating in such a commoditized space with thin margins.

Josh then walks through his innovative outsourced model, partnering with distributors and leveraging overseas virtual assistants paired with US-based order processing software. This approach maximizes profitability compared to the traditional route of taking on more overhead.

They dive deep into Josh's corporate store offering, setting up custom e-commerce platforms for major brands to streamline their staff's purchases of branded swag, uniforms, etc. Josh shares his framework for selecting vertical industries and perfecting the logistics to deliver seamless client experiences.

The conversation pivots to Josh's growth strategies - consolidating more distributors under his technology-enabled outsourcing system, and positioning as the "Shopify for promo products." His coaching arm, The Swag Coach, emerges as a prime customer acquisition engine by nurturing relationships with distributors.

Josh also explores creating a media empire around this niche industry via newsletters, podcasts, and social media for attracting both customers and recruiting distributors into his ecosystem.

Throughout, Josh emphasizes the importance of continuous learning, surrounding oneself with growth-minded individuals, and embracing an evolving leadership role from a transactional owner-operator to a visionary CEO.

Episode Highlights:

[2:43] Overview of the promotional products ("swag") industry
[6:12] Josh's innovative outsourced model using virtual assistants
[15:20] Unpacking the corporate store concept and revenue streams
[22:10] Sales processes across different verticals like corporations vs schools
[29:45] The "Shopify for swag" vision of consolidating distributors
[33:25] Using The Swag Coach for nurturing the distributor ecosystem
[39:17] Building a media empire around the niche via newsletters, social, etc.
[42:30] Josh's emphasis on growth mindsets and continuous learning

Quotes:

"We've tried many, many, many different things and sort of the lifelong learning, professional development space. We don't really do anything where there is, like a lot of existing services."
"If you can be in more places, there is the opportunity to seize more things if you can staff it."
"I'm trying to get to a much different group of people. I'm trying to talk to the business owners, not people who are just exploring business or, like, kind of wanna talk about a side hustle."

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