Episode 25: Imprint Genius Takes a New Approach to Sourcing Merchandise
Adam Honig: Since we’re in the AI space, we always like to bring in an AI angle. I don’t know if you guys have any sort of AI approach that you’re using if that’s something you feel comfortable talking about.
Isaac Hetzroni: Our new lead gen agency that we’re using is trying to implement some type of AI chatbot because we mostly do Google ads. That’s how we get most of our clients and we direct people to landing pages and stuff like that and they’re trying to set up. Essentially like an AI assistant that chats with them and qualifies them and asks them a little bit of qualifying questions. Half to qualify and half because it just sounds cool and looks cool. Like, look how cool and forward-thinking this company is. These guys are very different from the company down the street or the sourcing agent in China.
Adam Honig: Hello and welcome to Make it. Move it. Sell it. On this podcast, I talk with company leaders about how they’re monetizing the business of making, moving, and selling products and having fun along the way.
I’m your host, Adam Honig, the CEO of spiro.ai. We make amazing AI software for companies in the supply chain. But we’re not talking about that today. Instead, today we’re talking to Isaac Hetzroni, the founder and CEO of a company called Imprint Genius. Welcome to the show, Isaac.
Isaac Hetzroni: Hey, Adam. Happy to be here.
Adam Honig: Yeah, great to see you. Tell me a little bit about Imprint Genius. What are you guys all about?
Isaac Hetzroni: We are a product-sourcing and merchandising company. We work mostly in the enterprise swag space and we help create supply chain solutions and product sourcing solutions for company merch.
Adam Honig: Gotcha. What’s the problem that you’re solving for your customers?
Isaac Hetzroni: The industry as a whole is pretty archaic and traditional. You have a whole industry built on domestic decorators who warehouse millions and millions of items. Then the items are decorated when they’re ordered and then shipped out. Nowadays you have a very diverse global supply chain that you’re able to go and leverage to get higher quality, lower cost items. Then you have this $25 billion a year industry in the US where almost no one is going directly to the factory. Everyone’s going through these traditional vendors. On top of that, the entire distribution system is also messed up. After they go and use these domestic vendors, the large companies are then going and putting millions of dollars of items into inventory. The inventory sits there. It becomes no longer trendy. The logos change. People then get to pick from 10 different boring items because they can’t take risks. After all, that HR director has to go through and pick items that are gonna work for the whole company.
Then everyone ends up with swag they don’t want that’s overpriced, and not that creative. I think that is a pretty bad way to manage a supply chain. So, I started my company about seven years ago to try to fix that. My background’s in manufacturing. Both sides of my family own factories. Apparel factory on my mom’s side. And my dad owns an electronics factory in China. Once I kind of fell into this industry by accident, I was like, what are you guys doing? This is ridiculous.
Adam Honig: We have customers who sell branded swag with their company name and they give it out to their employees as well. And it’s a nightmare to keep all of that. Think about the sizes and all the different variables that go into that. That’s gotta be a big problem for companies.
Isaac Hetzroni: It is. You’re never gonna have enough. You either have too many extra smalls or not enough. You have to have this huge size variety. People want different cuts. They want different items, and some people want long sleeves. Some people would rather have one high-end polo versus two regular polos. That’s why we’re leaning on on demand. And in that technology, we built our custom app to run our entire swag stores without the need for inventory. We support inventory because there are benefits to inventory in certain capacities. But the idea is that 90% of items that are gonna be within a company merch store and distributed are gonna be printed as they’re ordered.
That triple XL T-shirt, or that shirt in pink that only one girl wants, but needs, that’s gonna be produced as it’s ordered. And we can do all these. We have a unique supply chain, so we can take any of those hundred thousand items, ship to the facility, decorate on demand, put everything together, and then ship it globally.
We think that’s a way better method because you have way less waste and you can give people way more variety. Then people don’t have to collect sizes. You have all these marking directors going and they’re spending their whole day trying to collect everyone’s sizes for their kickball tournament or whatever it is, and that person gets paid a hundred dollars an hour.
Adam Honig: I wonder if it’s an HR issue. Oh, we’re gonna have a database of everybody’s shirt size in the company. That seems kind of weird. I don’t know if HR policies are gonna allow for that.
Isaac Hetzroni: It is weird. You don’t wanna have to ask, “Hey, what size are you? Oh, you’re a triple xl? Oh.”
Adam Honig: And what if it changes or something like that? Yeah, that’s weird. Now, if I think about manufacturing, of course, the reason why the traditional approach was to buy in bulk is to get the cost down. How does the cost compare for doing this individually instead of buying a thousand large t-shirts or something like that?
Isaac Hetzroni: Yeah, Adam, that’s a great question. You sound like everyone that hops on a demo with us, they ask that question as well. And the answer is that it depends on the item. If we’re comparing it and we’re producing water bottles, yeah, there’s gonna be a decent discrepancy in price point if we’re creating one water bottle on demand versus going and producing a thousand overseas, especially. But if we’re comparing it to, let’s say, a higher-end item which is a lot of what we do now, like a Nike Polo or North Face jacket, all these other products, the cost basis is almost identical, because you have such a high unit cost and then your decoration cost is a smaller variable within that space.
Because that’s the case, we can essentially run at the same price without having to go and take the inventory on it. When you’re looking at lower cost items, let’s say like a t-shirt, there are a couple of variables that people don’t think about.
So when you have to go and make a thousand t-shirts versus doing them on demand, you’re going to have a ton of excess normally. So, you have a bunch of extra smalls and extra units that people don’t end up using. It can create some level of waste. You’re gonna have a bunch of people who never wanted the t-shirt in the first place. And now they’re not ordering it at all. And then tons of those t-shirts are gonna end up in the trash anyway because no one wanted that t-shirt. But in comparison, it might be about 20% more to do it on demand. So yes, it might cost you 20% more but you might then save 25%, 30% overall in the project. Without having to now take inventory and collect sizes and do all these things.
Adam Honig: I see. So it’s sort of like the total expenditure is gonna be about the same, even if the unit costs might be higher. That makes a lot of sense. And you mentioned something earlier like, oh somebody doesn’t want a t-shirt.
I feel like a lot of people don’t want t-shirts today. That’s from a trade show perspective or stuff like that. It’s just not a very popular item anymore. What do you see as the hot items that people do want?
Isaac Hetzroni: Technology is becoming a big one. We see a lot more drinkware, probably the biggest category within the industry right now.
Adam Honig: What does drinkware mean?
Isaac Hetzroni: like Yeti-type water bottles.
Adam Honig: Oh, I see. Like a cooler or something like that.
Isaac Hetzroni: Like just a nice premium stainless steel cup, bottle. It’s just been kind of a swell that blew up that whole industry. It’s now gone to the promo space and that’s probably the biggest one. But people just want a choice. Everyone’s different. Some people love T-shirts, some people would rather have a hat, a long sleeve. We have drones that we can do on demand. We have speakers, we have things like Apple AirPods. Now we have custom alcohol, custom plants, all these different product types that a normal marketing director if they were doing inventory, they’re like, we can’t go and inventory a thousand plants*. Are you crazy? Like, how are we ever gonna do that? But now with our demand technology and using these kinds of systems, it’s like, hell yeah. We can offer it to people. If it is the same amount as a Nike polo, cool.
Adam Honig: Wow. That’s amazing. I never thought about it that way. I do have a question because when I think about what you’re describing, you have to manage such a wide variety of items in your supply chain. Tell me a little bit about how you guys handle that.
Isaac Hetzroni: Yeah, we built our order management software and we integrated it into the APIs of some of the top blank apparel suppliers in the industry, as well as a couple of other smaller suppliers. And our app is cross-referencing the inventory levels across all the products.
So the items are getting marked in stock, or out of stock on the stores. And the idea is that the stores have hundreds or thousands of items on them for people to choose from. So if one item goes out of stock, there’s gonna be alternatives already there for people to choose from.
It removes the burden from us to manage the whole supply chain piece. And then we also mix in inventory solutions as well. Every employee still needs to get their starter t-shirt or their new hire kit or all these different other pieces. We’ll inventory that, but let’s not inventory everything.
Adam Honig: Gotcha. Do you find, like you have clients who are interested in sourcing with certain constraints like ethical sourcing or sourcing in various countries and stuff like that? How does that work for you guys?
Isaac Hetzroni: Yeah, for sure. That’s where we have a whole product sourcing division. We work with e-commerce brands as well. We’re able to use our diverse supply chain to make way more sustainable products and make full custom items. Then we also talk about from a sustainability perspective, we sell this as a sustainable solution as well because we understand that the biggest waste within promotional products is not necessarily the fact that the bag that you made is made out of non-recyclable material. It’s the fact that that bag is ugly as hell, and the person who got it threw it away right away and it ended up in a landfill. The biggest issue is the fact that people don’t have a choice, right? How many times do you order something on Amazon and immediately throw it away versus something that you got out of a trade show, and immediately throw it away?
So if you flip the script and you say, hey, you know what? It’d be great if the item’s recycled. But if the backpack is made out of pure oil, but you wear it for the next 10 years, well, that’s way more sustainable than your hemp bag that falls apart.
Adam Honig: Right. So if you give somebody something that’s a hundred percent recyclable, but they never use it, what’s the point? So, it’s interesting. It’s also designed as a sustainability concept. If we’re making beautiful things that people want, that’s much better for the environment than almost anything.
Isaac Hetzroni: 100 %. And we’re adding all these different trackability pieces as well. So it’s integrated into the CRMs, into your different software so that you can get analytics and see from this specific campaign, how many people converted into it. You have more visibility into the entire system of merchandise and swag. Before it was like, we’re just gonna produce a bunch of stuff and we’re gonna hope people are gonna keep it, the swag is gonna convert and work. Now there’s more and more opportunity for this to be like an intelligent way of marketing and making sure that all this stuff that is being produced is actually creating a positive impact in the business and it’s not just ending up in landfills.
Adam Honig: One of the things that I’ve been reading a lot about is the paradox of choice though, that when you give people more options, somehow they feel dissatisfied with what the results are. What’s your take on that as an advocate for choice?
Isaac Hetzroni: Yeah, I’d say that it’s still better than them only having to pick from the boring mug and a polo that doesn’t fit. Giving people the choice is still positive in that’s perspective. We also create solutions where people can pick from, let’s say, 20 items. And there’s like one plant, one polo, one gift card, one pair of air pods, whatever it is. It reduces the choice. It reduces all that headache and noise around it but still makes people pick what they want.
Adam Honig: It’s funny you mentioned the corporate mug thing. There’s a diner near me that’s called the Ugly Mug and if you bring in an ugly corporate mug, you get free coffee for that. Because that’s just like their thing. And you wouldn’t believe how terrible some of the designs are. You would probably believe it, but when most people look at that stuff, they’re like, “I can’t believe anybody ever bothered printing this stuff.”
Isaac Hetzroni: Oh, it’s ridiculous. Our old logo is a broken pen. We were just so against all these boring solutions to swag.
Adam Honig: What’s the craziest thing? Plants are pretty crazy. In Massachusetts, where I am, we’ve legalized marijuana, so I guess we could give branded marijuana plants out here somehow. But what are other crazy things that you’re seeing in this space?
Isaac Hetzroni: I’m trying to think. There are suppliers and all they do is custom, marijuana-related paraphernalia, and stuff. I think the tech side is getting awesome. There are just cool tech gadgets, like I said, like we’re doing selfie drones with full-color imprints and, really fun things on there.
But that’s one of the issues with the industry. People are really scared to do crazy unique products. Because for the most part, the whole industry still works on me. We take a ton of inventory and then we have to sell it through distributors. What we try to do is find cool products that are within the retail space, find the factories, and then produce those directly with the factories.
It’s a win-win for our customers because you’re getting a unique product. That’s actually how our company started. Our company started with me in college bringing those little cell phone fans that you’ve seen that plug into your phone. I brought one of those to a party and a bunch of people and sorority girls came up to me and they’re like, “Oh my God, where’d you get that? I need that for the rush.” Blah, blah, blah. And I’m like, “Oh, you could buy them on Ali Express.” Then eventually I was like, “Yeah, I sell them.” I made up a business on the spot just selling these cell phone fans. Then they blew up into a full-scale cell phone fan business, like e-commerce, different reps around different campuses, all this stuff.
Then we started selling the fans as a promo item. We started getting requests as a promo item and people had never seen this item in the industry. Because the industry was so scared to do this kind of item because it was so unique. That’s how I like dived into the promo industry.
It was just the fact that the items were so boring and I found the direct source of a cool product in the cool new way for people to put their branding on stuff. And that’s how I’m here today running my business.
Adam Honig: Gotcha. What I’m hearing from that story is that our customers and people listening to the podcast who are in a business, not to be afraid to try to kind of branch out with new things, because that level of excitement can just lead you into whole new areas of business. That’s kind of what happened to you.
Isaac Hetzroni: 100%. You gotta have fun with it. Have fun with it. Break some rules, and get creative. You never know what happens.
Adam Honig: Yeah. You’re working with all of these different suppliers. You’re getting a sense of what’s going on. From a customer perspective, what do you find challenging about acquiring new customers for your business?
Isaac Hetzroni: We do a lot of Google ads and stuff like that. It’s intent-driven, which is nice. But it can be tricky. A lot of times, people already have existing vendors. They already have ways of doing things.
They don’t understand that they can go to full-on demand. They don’t understand that you can go direct to factories and source directly. They’re like, oh, it’s just how we do things. You go through the vendors and this and that.
Adam Honig: I’ve always worked with the print shop down the street for the past 30 years or whatever. That kind of concern.
Isaac Hetzroni: Exactly. All of our swags are in our closet here in the office. That can be tricky. Then they have relationships. They don’t say this, but it’s like it’s their brother-in-law’s swag business. And they wanna keep on working with their brother-in-law and it doesn’t matter how great your tech is.
That can be a little bit of a headache. That’s why we went in on the technology side of things. We realized we couldn’t sell just one product. We had to sell a technology solution to break into these larger organizations.
Adam Honig: I know we were chatting a little bit about this before we went on air, but you were telling me that you’re trying to use AI to help you with this as well. Tell me a little bit more about that.
Isaac Hetzroni: Yeah, the lead gen agency that we use, they’re setting up like an AI so that when people fill out a lead form, an AI will start texting the person and start asking them more qualifying questions, telling them more about the business. We’ll see how it goes. I think it’s half of, yeah, I’m qualified, but we already have qualifiers. So it doesn’t matter. But it also is kind of fun. It’s kind of cool. It’s gonna make us look super techie and innovative, so I think it will lead to more conversions and more people working with us, because it’s like, wow, these guys are so advanced. They have an AI chatbot talking to me.
Adam Honig: Yeah. You never know. I wonder how AI will be embedded in the swag in the future. Like, are you gonna be offering an AI-branded something as a corporate giveaway in the future? I wonder how that would work.
Isaac Hetzroni: Yeah, we played around with that a bunch where we were working with this one AI company and we were trying to create a campaign. Essentially it was like a show on Netflix showing the feature of AI. AI would also generate a t-shirt and we’d print those on demand.
We never launched a campaign, but it was kind of cool thinking about every shirt being unique and playing around with that. And I also saw another promo company recently. I was looking through and they had a swag idea generator. They used AI to help you put in a couple of different fields and it would like to give you random ideas for what kind of swag you could do for your brand.
Adam Honig: Yeah. I feel like the image generation stuff is so cool, but I know when I’ve tried to get it to do logos and stuff like that, it just gets kind of crazy. I don’t feel like it’s quite there for that yet. But if you wanted to make a picture of a monkey or something like that, it does that great.
Isaac Hetzroni: Yeah. I don’t know if we’re gonna use that just yet. I don’t know if the AI drawings are gonna pass the design and if the marketing team approves them yet.
Adam Honig: Yeah, probably not. They get a little too crazy. They add too many fingers to hands and stuff like that, but we’ll see. But I think having AI within the way to acquire customers is something that we’re seeing as a trend in the supply chain. A lot of companies are experimenting with that today.
Isaac Hetzroni: 100%
Adam Honig: Cool. Isaac, this has been awesome. So great to have you on the podcast. Appreciate your coming on.
Isaac Hetzroni: Of course. Thanks for having me, Adam.
Adam Honig: Yeah. As a reminder, you can find every episode of the Make It. Move It. Sell It Podcast at spirit.ai/podcast. Please be sure to subscribe and give us a great review.
And maybe Isaac, just before we go, tell people how they can get a hold of you and, and learn more about your company.
Isaac Hetzroni: Yeah, can check us out at imprintgenius.com. Get a hold of me at thesourcingguy.com, which is my personal brand where I talk about supply chains and do supply chain education. But yeah, hit us up. Happy to help.
Adam Honig: Awesome. What do you think? Should people give us a good review on the podcast?
Isaac Hetzroni: Hope so.
Adam Honig: Yeah, let’s do it. I think that would be great. Thanks to everybody for tuning in and we’re looking forward to seeing you on the next episode.