Increased Production & Changes At Shoyoroll
Lately Shoyoroll has increased production of its gis (from both a # of batches per year and # of units per batch perspective), as well as some of its other offerings such as rash guards. What also must be acknowledged is that Shoyoroll has also:- Increased retail prices (for all goods);
- Increased its “shipping” charges to an amount that is far more than the actual cost of shipping;
- Opened up some items (like the recent rash guard drop) to a full day long “pre-reserve” where they’ll take any and every order possible over a 7 or 8 hour period;
- Expanded internationally into Europe/UK and Japan with bases of operations there;
- Opened up its GUMA program to a expansive number of new people;
- Launched an independent European GUMA program;
- Gone as far as offering 2016 UberGuma to FRESHMAN 2015 Guma members. This has upset many hardcore, long-time supporters of Shoyoroll who are pioneer GUMA members from 2012, the only ones offered the elite UberGuma status in its first year, 2015; and
- Increased its “Sponsored Athlete” program dramatically. This is worthwhile to note because only a small fraction of a percent of those “Sponsored” by Shoyoroll actually are receiving their gis and gear for free. Those people are either the elite of the elite, or the ones who spend time every day on social media promoting the brand. All the other “Sponsored Athletes” PAY for their gis and gear. Sure, it’s at a discount and they don't have to fight the public for drops, but it is still at a huge profit to Shoyoroll; approximately 300% of production cost. So what these people are is really SuperUberGuma members. They are not sponsored by any sense of the imagination.
Why is this and how will it impact Shoyoroll and the secondary market?
The why is pretty simple: to grow the brand both domestically and internationally, increase primary market share and with all of that, increase corporate profitability by depressing the secondary market in favor of the primary market.Shoyoroll has not been secretive of their dislike of the secondary market. They feel that all the monies going toward purchasing Shoyoroll in the secondary market are capital market monies that should be going to Shoyoroll corporate. And in some sense they are correct. Now, I don’t know if they realize or will acknowledge the positive impact that the secondary market has had on Shoyoroll over the years. But the fact is, it has.
The Impact
The question is…if Shoyoroll continues to saturate the primary market with all these gis (in both # of batches and, like today’s drop, # of units per batch), what will happen?The immediate impact is that Shoyoroll satisfies the capital market demand via the primary market, leaving nothing for the secondary market. So all the monies go to Shoyoroll, and very little if any go to the secondary market. This will be good for Shoyoroll (in the short term), but bad for resellers and the secondary market.
However, let’s examine these happenings at Shoyoroll one at a time and make logical projections as to how both Shoyoroll and the market will be impacted.
Increase in production - # of Drops
- With this, if people miss out on today’s drop they know that there will be another drop right around the corner. So there is no need to pay more than retail in the secondary market when they just have to wait a few weeks or a month for the next drop.
- More $ for Shoyoroll.
- Less $ available for the secondary market.
Increase in production - # of Units per Batch
- More gis for more people to purchase in the primary market. This means more $ for Shoyoroll, and few if any buyers looking to the secondary market because the primary offering satisfied the demand.
- It also means no resellers (or BJJ’ers looking to flip a single gi (not an official “reseller” by any stretch)), will no longer be buying these batches.
Increased retail prices
- More $ for Shoyoroll.
- Elevates the value of older batches in the secondary market as well.
- Also, will drive away buyers from the brand who are impacted by such high retail prices.
- Exposes Shoyoroll to competition.
- Loss of customer base due to numerous less expensive options in the marketplace.
Increased “shipping” charges
- More $ for Shoyoroll to offset the “other” costs of shipping, such as supplies and increased labor needed for packing and shipping of the gis and gear.
- Pissed off segment of the market who are already wondering why they are paying $30 for a tee shirt, much less $20 to ship it.
- Adds expense to the overall cost of items, resulting in prices beyond the reach of a segment of the market.
Opening up items to a full day long “pre-reserve”
- More $ for Shoyoroll.
- Superior way to determining demand. Hell, it’s better than making 100 units and selling out in 3 seconds. And it’s far better than making 5,000 units and being stuck with 4,500 that didn’t sell.
- Completely obliterates any secondary market for that item.
International Expansion (Europe/UK and Japan)
- Greater visibility and market presence for Shoyoroll.
- Increased ability to penetrate new and foreign markets.
- Increased opportunity to build relationships in forging markets with manufacturers, distributors, athletes.
Opened up its GUMA program to a huge number of new people
- More $ for Shoyoroll (the GUMA fee plus a guaranteed buying public. Guma members tend to buy more than the average ShoyoFan).
- More predictability for production because GUMA members pre-reserve what they want.
- Dilution of the elite GUMA membership.
Launched an independent European GUMA program
- More $ for Shoyoroll
- Gives Shoyoroll a captive audience of buyers in Europe and UK
- Spreads the brand throughout Europe and UK markets
- Less international buyers looking in the secondary market to make purchases.
Increased 2016 UberGuma Membership
- Pissed off a lot of life-long, hard-core ShoyoFans
- I don’t see any upside to this, other than making stronger fans out of those who were offered the elevated membership.
Increased its “Sponsored Athlete” program dramatically
- More $ for Shoyoroll (since these athletes purchase their gis and gear at a huge profit to Shoyoroll).
- Increase market visibility and penetration.
- Secure long-term loyalty of these athletes to the brand
- Blocking CTRL and other brands from these sponsorship opportunities
Is Shoyoroll Ready?
One question that I have is this…Is Shoyoroll prepared for life without the secondary market?The knee jerk reaction of many is, “OF COURSE. It’s more profitable for Shoyoroll and screw those resellers.”
Well that is true, but if Shoyoroll creates an environment where there is no secondary market, then they better step up their game BIG TIME in a few areas, including:
- Customer Service
- Product Quality
- Quality Control
- Sizing Consistency
Why is this?
Well, right now if first time buyer John Q. Roller buys an A2 gi from Shoyoroll based upon their size chart and it doesn’t fit, what does he do? He sells it for a profit on the secondary market and no one is the wiser.The same goes for Hamid E. Armbar who is an UberGuma member and a solid A1L, however the A1L for this recent batch doesn’t fit like the A1L’s that he is used to. So what does Hamid do? He sells it for a profit on the secondary market and no one is the wiser.
Now, in both of these cases Shoyoroll is not impacted by their all-well-to-known sizing discrepancies from batch to batch and even within the same batches. Why? Because the “out” for these ill-fitting gis is a simple trip to the secondary market. BUT, if there IS NO SECONDARY MARKET, then Shoyroll will be DELUGED in returns.
For years I’ve seen post-after-post and comment-after-comment in various groups on Facebook that all say the same thing…. “I’m selling because it doesn’t fit….” And many of those posting are not new to Shoyoroll. In fact many are from the ShoyoTroll gang who so often promote their love of the brand…but I guarantee will be the FIRST in line at the return counter when there is no more secondary market. #becarefulwhatyouwishforsucka
Then there is Product Quality. Well, we all know about those V1 and V2 Absolute pants that ripped open like they were made of cotton balls from Wal-Mart. In the beginning, Shoyoroll was replacing those pants. Then they made a whole new batch of replacement pants because it was happening so often. Later, when they got tired of replacing the pants they simply stopped returning emails and inquiries from customers. Many of whom were long-term customers of the brand, and even UberGuma members. Basically, they started to ignore people. And that’s never a good thing.
Ultimately, most of these now-ignored, Absolute-pants-turned-into-shorts-wearing ShoyoFans have just moved on and written it off because OVERALL, they make $ in the secondary market and don’t want to piss off Shoyoroll. Well, if there IS NO SECONDARY MARKET then these bare-kneed, unhappy customers will NOT just write it off and will work with PayPal or their credit card company to get a refund.
How about Quality Control?
- Ever see an Americana with the hip patch of a Compadre?
- I have had two of them.
- Ever have a gi show up that’s missing a patch?
- I have one here right now.
- Ever have a BNIB gi be delivered that has mismatched sized top and pants?
- It happens.
- Ever have a gi land on your doorstep that has some damage?
- Sure have.
- Ever have a gi show up where the colored embroidery is already bleeding into the white gi?
- Sure have. Got one right here.
- Did you get one of the SGT bags that didn’t have any Velcro?
- Yep. Sure did.
- Ever order an A2H and an A2 arrives?
- Yep, sure have.
- Ever pay nearly $100 for a rash guard, only to have an obvious, visible defect in the sublimation?
- Yes sir. Sure have.
- And on, and on it goes. It’s part of being a large company with poor quality control.
And right now…in ALL OF THE above instances the problem is taken care of by the Secondary Market. But if there is no secondary market, most of those gis or rash guards will be returned for a refund or replacement. And as they've demonstrated time and time again, they are not prepared for this. Not in the least bit. And that's understandable because up until now they haven't needed to be.
As far as Sizing Consistency goes…well that’s a dirty little secret that many people don’t talk about but are aware of. I just sold an Olive Undefeated to a friend. This is his second. And they are both the same size yet they fit differently. Same batch, same size, same body. Different fit. And that’s WITHIN the same batch. From one batch to the next, Shoyoroll is well known for its sizing discrepancy.
I had an A2 Americana…fit WONDERFULLY. That’s batch 10. Then I got a Rio Koi, Batch 12. Tight as a virgin. Same size, but didn’t fit.
Then I got a Batch 17 Competitor, also Size A2. HAD TO BE an A3. Friggin’ HUGE. I was swimming. Measurements were WAY off from other A2's that I had. Even of the same batch.
Then the Batch 16 Forever Rolls hit my doorstep. Shrunk to a hand puppet after the first wash.
Most of these sizing discrepancies are well known in the Shoyoroll community and as such, accepted. We’ve learned to buy a size up with the Rolls for example. And we don’t worry about the Rio Koi not fitting like the prior batch because it’s an easy flip for a profit.
I had this same discussion with a friend close to Shoyoroll once. And his comment hit the nail on the head. He said,
“The secondary market allows him to run a shitty business.”
And that really sums it up. And sadly so.
Finally
If Shoyoroll continues on its path to squash the secondary market, so be it. That’s their choice. Personally I don’t give a hoot because I’m on to a much larger and more meaningful endeavor no matter what they do. But they better be prepared for what happens next.In life, we can choose our actions but we can’t choose the consequences of those actions. Shoyoroll best learn that lesson quickly because the American landscape is littered with the corpses of once profitable and often dominant business that failed to recognize when internal change was needed.
Update
In the Shoyoroll Drama Free Facebook group, one astute member recently asked (in so many words):
How does Shoyoroll's increased production bode poorly for those of us who actually like to buy these gis to train in? If the primary market produces enough gis to negate the secondary market, then the average BJJ'er who is also a ShoyoFan won't have to pay ridiculous prices on the Secondary market to get one. Shoyoroll was never about flipping gis, they're about the Jiu jitsu.
In response I'd say this:
There is no question that these drops of large numbers of units is in favor of the consumer. Especially if prices come down due to oversupply. But there is no indication of that yet on the retail or the secondary market, except for these large drops where there is no secondary market.
That being said, in looking at this situation from a business perspective it is possible for more than one path to be viable and financially successful. The question for Shoyoroll is this:
Do you want to be Calvin Klein? Or do you want to be Fruit Of The Loom? Because right now, with these increased numbers they're headed in the direction of Fruit Of The Loom.
Sure, both make money, but the buyers for one are not the buyers for the other. And for years Shoyoroll has been more like the Calvin Klein of jiu jitsu gis. If they want to compete with Fuji, then go right ahead. But the buyers are different.
And which if these two is the rebel? And which is mainstream?
.jpg)
0 comments:
Post a Comment