Promo Products Prove Profitable for School District In-plant
Trying new things is always a good New Year’s Resolution. As 2023 begins in earnest, it’s worth looking into ways your in-plant can explore new services to maximize profitability. If you’ve ever been curious about adding promotional products to your repertoire, now is a perfect time to start. If you haven’t considered it before, maybe some insight from someone who has ventured into the promo industry and seen positive results will entice you.
Martin James, manager of Print Services for the Deer Valley Unified School District in Phoenix, started including promo items in his in-plant’s services five years ago. Having brought a private sector mentality to his government job, James was not afraid to try something new.
“We’re always looking for additional revenue,” he says during an interview on the show floor of the PPAI Expo, one of the largest promotional products industry trade shows in North America. “So that was the biggest reason to [add promo.]”
James and the Deer Valley Unified School District just needed to find the right opportunity to get started. That came when the person who previously had been selling promotional items for the school district retired, and James saw his moment.
“I’m going in because my competition retired,” he says. “It made it easier to get in when you’re not fighting somebody who has the majority of the business for the district they’re working for. So, we saw the opportunity, came here [to the trade show], joined the association, and started selling promotional items five years ago, and it’s turned into a six-figure side business, or additional revenue for our department.”
After a modest start in 2017, the in-plant’s promo product business grew rapidly, reaching more than $100,000 in revenue in FY 2020-2021. When Erik Hackenschmidt was brought in to handle the business, revenue increased 65% and has continued to grow.
Beyond the Why: The What
The beauty of promotional products is that the sky is pretty much the limit. If it has a surface that you can print ink on, it can serve as a promotional product. That means your in-plant can work with products like apparel, toys, office supplies, stickers, tablecloths, drinkware, even food. Now, it’s still within your best interest to choose products that appeal to the end-user and fit within the context of what you’re doing. For James and Hackenschmidt, that meant starting with basics like pens, pencils, and lanyards — items school employees and students use on a daily basis.
“That’s where we got our feet wet,” James says. The in-plant has expanded well beyond that and now even sells apparel.
“We have our wholesale contracts with two of the biggest blanks distributors in the country for our apparel,” he says. “Promotional items drew us into apparel, so that’s part of our business as well.”
With so many different options for branded applications, having your in-plant serve as the source of promotional products means all of the branding is appropriate and conveys the image your parent organization wants. That means more than just the logo is used correctly.
“It keeps up the brand standards, whether it be our own district or others,” Hackenschmidt says. “It allows us to keep those standards, so somebody [doesn’t] go off and do something entirely outside of what their normal district standard would be.”
That means something as simple as limiting anything relating to alcohol from bearing the school district’s name.
From there, once people know you’re capable of churning out promotional products in-house, you open yourself up to more business. That’s exactly how James’ in-plant went from using promo as a little side gig to a six-figure source of revenue.
“Also, it brings more customers in to what we do,” James adds. “They might be interested in promotional items, and we’ll sell them apparel and we’ll sell them print. We’ll sell them direct mail. It’s just the relationship and seeing the right opportunity to offer enough products to our customers so they come to us first.”
Strength In Numbers
One of the first steps James took was joining PPAI. Frankly, the promotional products world can be daunting to an outsider, so joining an association and taking advantage of trade shows and educational events is crucial to understanding how things work and making your in-plant’s promotional venture profitable.
“In order to be in this business, you have to be in an association to get your foot in the door, to be able to find all of the [suppliers] that are here,” James says.
Some of the big-name suppliers the school district has worked with include Showdown Displays, Hit Promotional Products, and Koozie Group.
There are ways to find suppliers like these without leaving home, through platforms like SAGE, which Hackenschmidt uses to find suppliers for Deer Valley’s promo items.
“There are going to be top-rated suppliers that are on SAGE, and that’s what helps us,” he says. “SAGE does give us the ability to go through the weeds and find the good ones.”
James also uses trade shows to advertise his in-plant to other school districts and associations looking for promotional and print products. Organizations catering to superintendents and school districts are gold mines for potential customers.
“We go to trade shows to promote our business to other school districts and associations that are part of school districts,” James says. “The superintendents’ association, the school districts’ association, ASA, ASBO — each state has its own individual association like that.”
Talking Dollars and Cents
From the actual business side of things, James and the Deer Valley Unified School District found success and revenue growth with their promotional products business by taking advantage of all of the industry platforms available to distributors and creating online ordering platforms that facilitate business. While it’s all under one roof, his in-plant uses different sites due to the sheer volume of products available on the promo and apparel sector of the business.
“We have a promo site, we have an apparel site, we have a print site,” James says. “We’d like to merge them all together, but you really can’t, because this site is unique unto itself with all of the thousands and thousands of different promotional items that you can buy using the SAGE software and being a part of PPAI.”
Once products are selected, James says the in-plant uses a 50% markup for products. Though they’re certainly proud of achieving six figures in revenue from something that started as a glorified experiment, James and Hackenschmidt are not done. Both understand the potential in promotional products and continue to push it as a major service at their in-plant.
“We wouldn’t be here five years later if it wasn’t [revenue-generating],” James concludes. “Again, we’re both private-sector mentality, and that’s why we’re successful. If we’re doing something that’s not making us money, then we’re going to eliminate that from our products.”
Related story: Deer Valley's Ambitious Approach
Brendan Menapace is the senior digital editor for Promo Marketing. While writing and editing stories come naturally to him, writing his own bio does not.