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Business Lessons Learned from Thai Tailors

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thai tailorsNow I’m mostly concerned with building online lifestyle businesses but this blog post is really something most people running a business can learn from.

Now as you might know, we spend a few months in Thailand each year, and if you’ve ever been in Thailand you’ve probably also been exposed to the tailors that are located pretty much everywhere there’s a chance that a farang (=> western foreigner – most likely with money in his pocket) will stop by.

Since there’s quite a lot of competition the tailors are often rather agressive when it comes to literally pulling people into their stores.

I write literary because this was my first experience with a Thai tailor back in 2002 when I first visited the fantastic country. It was the first day on Phuket (an island with a lot of charter tourism) that I got exposed to their aggressive marketing techniques. Basically a guy jumps out in front of me and puts out his hand to greet me.

As the polite young man I am, I also put out my hand in order to shake his (apparently he was part of some Thai welcome committee that insisted on greeting everybody). You know that awkward moment when you feel that you really should stop shaking hands? Well it came and went and the guy was still holding on to my hand.

And while he was trying his best to show off all the different Danish words he’d learned, he was walking backwards and pulling me into a tailor shop.

And you might think that I shake myself loose, but again I’m a really polite young man and I thought about how he would react if I just yanked myself free from his grip.

I mean there are a shit load of Thai boxing places and since they’re mostly Buddhists and believe in reincarnation, I didn’t really like my chances in case he got mad at me for rejecting me (now of course I’m a little wiser… ;)).

So, long story short. I ended up getting out of his grip and didn’t end up spending a day in a tailor shop being sold to.

thai tailorAnd I must admit that I even to this day often find Thai tailors a bit pushy, but with that said I’ve become increasingly interested in their business models. Also, they clearly know a thing or two about selling – so this blog post is all about all the ninjakickboxing selling tricks you can learn from Thai tailors.

Marketing

  • Blind marketing – in front of many tailors you can see young boys typically in nice shirts (I guess they get a discount) who are only concerned with getting people into the store. Now the twist here is that they are not really knowledgable about the actual product, but is mostly trying to bond with you by speaking to in your native language (which they only get right half the time)..

    If they mention the product it will most likely just be something with “cheap prices for my best friend”. This leads my thoughts to the term “Blind Marketing” where it’s really about getting a lead without any mentioning of the product or service.

    Now while it might not sound ethical it can be a strategy you would use to optimize the leads you get. Just see how much buzz (and leads) The Segway got even before people knew what it was.

  • Success are in the numbers – The tailors know that the success lies in the number of leads they get. I’m convinced that most tailors have an almost exact number of how many bewildered tourists that need to step through the door before they make a sale.

    So by focusing aggressively on the marketing the pump up that number. It’s super simple but cannot be repeated often enough. The more people who sees your offer the more sales you will have!.

  • Cheap offers to get people in the door – you often see really cheap prices for suits and shirts hanging in the windows of the tailors (and on printed promotion being handed out). Actually this happens a lot with tailors who don’t have people out in front to pull people in.

    The problem is that once you’re in the store the price is most often much more. This is because that the price you saw only was if you selected some really crappy fabric and I’ve even heard bad excuses with the offer had expired and so on.

    So what can you learn? Well try to have some really killer offers (that are real I might add, in Denmark the tailor way of marketing would be illegal) to get people to get into the store and then try to do some up-selling (see next section)

Selling

  • Up-/cross-selling – they are masters of draining you from your last cent. Once you thought that you should buy those three suits, they will ask you if you need two pair of trousers for each suit. They will also offer you a sweat deal on 3+ shirts. And what about your spouse? She should have some really cheap tailor made silk kimonos right? (don’t even get me started on silk kimonos, but it’s safe to assume that we got a couple of them at home that have never been used).

    If you are selling a product or service, how can you get even more money out of your customers? Once they have the credit card out, it’s really easy to get people to buy 10-20% more.

  • Reciprocity – argh the secret jedi mind trick of reciprocity.

    If you don’t know the term, it’s basically that you give someone something of value for free. That individual feels an obligation to return the favor. So guess what. They are picking you up from your hotel or villa (or wherever you’re living) and bringing you to their store. They are also driving you home again if you prefer. And that’s not all. When you get inside they offer you cold drinks while you’re browsing through their model catalogs.

    Ahhhh damn them. How can you say “well thanks for the ride and free drinks – I don’t really want to buy anything from you”.
    We see this a lot online where people are offering stuff for free in order to get something in return at a later time. This is very powerful stuff!

Business Model

  • Competition is good – I often talk with people who have this unique idea with absolutely now competition. WTF? Competition is good.

    It shows that there is a market and money are being spent! You can just copy the business model and focus on improving it 10%. Here you can really see this in effect. So much money is being spent in this market that it’s a good idea to open another tailor even if there are already three other in the same street.

    We used a tailor in Hua Hin (where we have our house) that owned three stores in the same small city. The stores were all in short walking distance of each other?!!!
    So don’t be afraid of competition. A crowded market just means that someone are making money.

  • Minimize fixed costs – the tailors typically operate this way: There are some people owning the stores who buy all the different fabrics. The good thing about the fabric is that it can live a long time on the shelves – they don’t suddenly go “too old”.

    The store owners then hire freelance tailors to do the actual production. Actually the freelancers are typically specialized in just one garment type (such as trousers or well… silk kimonos). So while there is an initial investment to start up the store, the owner can really just employ some cheap labor that really only have to look smart in a suit to greet you in the store. The most expensive employee (or employees) is the tailor who are paid per item sold.

    This also gives the added bonus of getting people who are very specialized in what they do. Otherwise a small store owner would perhaps have just one tailor employed but by only working with freelancers he can get the ones who are best suited for the particular product (and in the end also get the best price as he can play different contractors up against each other)
    I use a lot of (outsourced) freelancers who are only paid per client project and this is one the strategies I use for keeping the fixed costs down.

Do you have any ninjaThaiboxing business tricks?

Have you been to Thailand? And if so what were you thoughts on the tailors?
Let me know you thoughts in the comments 🙂

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2 Responses to Business Lessons Learned from Thai Tailors

  1. Maximilian says:

    This is a cool Article…I wondered at my Thailand Holyday, how this tailor Business Model work. There are so many. Some make awesome suits and some make crab. But they can all life from their work…

    This was a easy but very important lesson for me….
    Thanks

    MAX

    • Rasmus says:

      Hey Max

      Thank you for your comment. Yes and this also mean that most of the tailors “can” supply the same product/quality.

      So the important lesson in selecting a tailor is basically finding someone you trust. 🙂

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