20Jeans Uses Customer Feedback, Outsourcing for Success

There will come a time when men will stop wearing skinny jeans and when that time comes, 20Jeans will likely be the first to stop producing them.

20Jeans.com is aiming to alter the denim marketplace. The Web based denim retailer uses real time data, including sales and customer feedback, on its website to make alterations on its products constantly.

Co-founders Mark Lynn and Corey Epstein claim the secret to their success is low overhead and no middle man. The company sells only from its website and outsources production.

20Jeans offers its denim jeans starting at just $20 a pair. The lowest price tag on a pair of Levis, by comparison, is about $48.

On the company’s website, they explain:

The way we see it, there’s no need to blow their price point out of proportion. With this in mind we design and produce our inventory, then connect it directly to you, the customer - thusly making dual “nice saves.” One, our precious commodities from retail Purgatory. The other, money - both on our side and yours.

The quick response to customer feedback is the key to 20Jeans success, Lynn and Epstein told Bloomberg News recently.

So if 5 customers in a row complain about a certain aspect of a fit on a pair of their jeans, 20Jeans can take that information and have alterations ready for future sales. To do this, the company uses an in-house team of designers to make quick changes and a group of outsourced suppliers and manufacturers to fill orders.

Epstein says he drew heavily on connections in China’s Shanghai garment industry to help the company sell their jeans at affordable prices. The company claims to have sold 50,000 pairs of jeans so far.

How can your small business use customer feedback  and outsourcing to improve performance in a competitive market?

Image: 20Jeans

Owning A Franchise That Almost Everyone Frequently Visits

Unless you drive a vehicle that plugs in, you’re going to be frequently visiting gas stations all of your adult life. Some simple math will help you figure out where I’m going with this - owning a franchise that almost everyone visits.

Let’s say that you start driving a vehicle consistently at the age of 18. Let’s also say that you’ll be filling up your vehicles’ gas tank once a week. Today’s gas prices hover around $3.50 a gallon. Filling up a 12 gallon gas tank will cost you around $42. Multiply that amount by 52 weeks (52 x 42 = $2,184.00).

If you drive until you’re 75 years old, that means that you’ll have driven for 57 years. If you’ve been filling your vehicles’ 12 gallon gas tank up every week for that entire time, you’ll have spent $124,488.00 on gas ($2,184.00 annually x 57 years of driving).

Are you with me so far? Let’s keep going.

As of 2010, there were around 250 million vehicles on the road in the US. If the owners of those 250 million vehicles are spending $2,000 or so a year on gas, that means that $500 billion is changing hands at gas stations all across the U.S. (Hat-tip to Chris Wisbar who helped me with the math.)

Company-owned and franchisee-owned gas stations are doing the selling - and almost everyone goes to a gas station once a week.

How Much Green Is Involved?

If you think that I’m going to be going all green with this month’s franchise article, you’d be wrong. As a matter of fact, this article is focused on fossil fuels…petroleum, and it’s delivery via retail franchises.

According to the National Resources Defense Council (NRDC) retailers-including distributors and marketers, on average made about $0.04/gallon in profit. Some of these are actually the oil company’s themselves (company-owned stores), but many of these are independently-owned and operated stations who make more money selling candy and hot dogs than gasoline. . .gas station franchises.

There’s a lot of markup in the products that are sold by these gas stations. That’s why more and more gas stations have convenience stores inside of them.

Gas Station Franchises

Would-be franchise owners contact me several times a year seeking information about owning gas station franchises. Admittedly, it’s one sector of franchising I don’t have that much experience with.

One reason for my lack of experience is that in the 12 years I’ve been assisting would-be franchise owners, I’ve only worked with one person who was seriously looking into purchasing a gas station franchise. It was a 7-Eleven franchise (with several gas pumps) and it had just become available.

The 7-Eleven franchise model is unique in the fact that it builds out stores well in advance, and then offers them to franchise candidates that qualify.  In other words, the stores are ready before the franchisee even signs the franchise agreement.  In most franchise opportunities, the location for the business isn’t chosen until the franchise agreement has been signed and the franchise fee paid.

Another player in the gas station franchise sector is ampm. There are three distinct ways that you can become a franchisee of their franchise opportunity:

• Develop a new-to-industry ampm facility: What that means is that you build out a new franchise location-including both a gas station and a convenience store, from the ground up.
• Re-Brand Existing Gasoline/C-Store: Opportunities are available to re-brand an existing non-ampm gasoline c-store facility. In other words, you would convert a non-franchise gas-station/convenience store location into an ampm franchise location.
• Re-Brand Existing Gasoline Station: If you only want to own a gas station-no convenience store attached, ampm offers a way for you to convert an existing gas station into an ARCO gas station. (Arco and ampm are one company.)

Qualifications Needed To Buy a Gas Station Franchise

If you want to buy an ampm gas station franchise, there are several things that you’d need in order to qualify for franchise ownership. Here are a few of them:

• U.S. citizenship or permanent resident alien status with a minimum age of 21 years old.
• Personal participation in operating a retail facility (minimum of 40 hours per week).
• Successfully complete all training requirements.
• Good credit record / credit history evidenced by prompt payment of all financial.

In addition, you’d need to have deep pockets. That’s because the total estimated investment (listed on the ampm franchise website) is $1,822,705 - $7,767,767 ( including estimated real estate costs). In addition, the amount of liquid capital needed may be $1,200,000 or higher.

So, in order for you get a piece of the retail petroleum pie, you’ll have to invest a lot of money up-front - especially if it involves building out a brand-new store.

Another Option

There’s another way for you to get involved in this sector of franchising, and your investment could end up being lower.

You can buy an existing gas station franchise. There are always gas stations for sale. If you’d like to investigate buying an existing gas station franchise, the following websites provide detailed listings:

If you decide to look into gas station franchise ownership, know that in your lifetime, it’s doubtful that your petroleum-based business will become obsolete. Just make sure that you have other products to sell along with your gasoline.

Gas Photo via Shutterstock

Enterprise Analytics: Big Data Measures to Better Business

I’ve reviewed books written by one author, but rarely have I come across a good compilation of business experts in one text. Leave it to business intelligence to yield a solid compilation such as Enterprise Analytics: Optimize Performance, Process, and Decisions Through Big Data.  

Edited by analytics expert Thomas Davenport, the book gives an overview of business intelligence that can make or break strategic big data development. This past summer I picked up a free copy from the Chicago stop of a SAS road show for its new data virtualization solution.

Because of the different authors involved, I will highlight the sections that I feel are worth a read.

The first chapters outlay analytics in its various forms.  Davenport begins chapter one explaining the various forms of analytics and their differences, while chapter two, by Keri Pearson, provides a financial example of ROI. A list that appears at the end of the chapter has some great lessons learned that consider an order of potential occurrence.  Such an approach can help organization frame which project to address.

To show what I mean, here’s an example of selecting the projects with the largest ROI (return on investment):

Start with the high ROI project, not with the low or hard-to-quantify one.  The first project normally bears the biggest cost because the start up usually involves setting up the data warehouse. If it can be done with a large ROI project, future projects are much easier to justify…

The most relatable chapter for small businesses is Chapter 4. The author, Bill Franks, gives a good foundation of how Web data is the basis for doing more than accounting Web traffic. He offers a refreshed look at the worth of non-conversion traffic - the 96% of website visitors that do not click an intended button or submit a fill-out form.

This segment is worthwhile for small businesses seeking a deeper reasoning behind the cost to modify an analytics solution or create a custom dashboard. Many still treat analytics as a form of accounting. As they say in commercials “Wait, there’s more!” Well, Franks explains the “more” with the chapter segment, Web Data In Action. He mentions a few models such as attrition and response modeling. I liked how imaginative Franks take is for emphasizing the customer segments that businesses can develop, such as this comment:

Consider a segment called Dreamers that has been derived purely from browsing behavior. Dreamers repeatedly put an item in their baskets but then abandon them. Dreamers often add and abandon the same item many times…So what can you do after finding them? One option is to look at what the customers are abandoning.

Another solid segment is Chapter 12 Engaging Analytical Talent. This was written by Jeanne Harris (who co-wrote Analytics at Work with Davenport and Robert Morison) and Elizabeth Craig. It gives a brief overview of how to set assignment objectives that shows your organization understands analytical talent:

Arming analysts with crucial information about the business is one way to keep analytics talent engaged.

The ideas were spot on to what’s happening.  I recalled a well-known recruitment firm’s study that indicated analysts changing jobs partly from lack of engagement and meaningful support.  Moreover, Harris and Craig show how to identify “4 Breeds of analytical talent” that deftly conveys the value of each talent.

Privacy issues are noted in Chapter 4, but advocates should read Chapter 13, Governance for Analytics.  Stacy Blanchard and Robert Morson lay out the process for establishing analytic management, the processes that ultimately protect data as much as it extracts value:

Establishing governance is a mix of science and art, where the specific power dynamics within the organization play a significant role.  There is no single right governance model for analytics, but a number of good principles and practices are commonly found among the organization with high-performing analytical capabilities.

Concepts, while meant for large organizations, can still fit a medium sized business, such as guiding principles and understanding why governance is important.  The list “You Know You’re Succeeding When…”  can be modified for smaller businesses that uses analytics and have stakeholders remote from their operations.

Later chapters present cases of large enterprises. A few note the impact of analytics on specific industries, such as retail (Sears) and pharmaceutical (Merck).

Again, this is a book meant for managers of large organizations. But for small businesses looking to grow, it can give an overview that encourages a deeper appreciation for detailed books like Web Analytics 2.0 or Performance Marketing with Google Analytics.

Analytics, in general, forces a business to look critically at how it operates.  Books like this one will provide the right framework for managing those operations for your best business performance.

Enterprise Analytics: Big Data Measures to Better Business

I’ve reviewed books written by one author, but rarely have I come across a good compilation of business experts in one text. Leave it to business intelligence to yield a solid compilation such as Enterprise Analytics: Optimize Performance, Process, and Decisions Through Big Data.  

Edited by analytics expert Thomas Davenport, the book gives an overview of business intelligence that can make or break strategic big data development. This past summer I picked up a free copy from the Chicago stop of a SAS road show for its new data virtualization solution.

Because of the different authors involved, I will highlight the sections that I feel are worth a read.

The first chapters outlay analytics in its various forms.  Davenport begins chapter one explaining the various forms of analytics and their differences, while chapter two, by Keri Pearson, provides a financial example of ROI. A list that appears at the end of the chapter has some great lessons learned that consider an order of potential occurrence.  Such an approach can help organization frame which project to address.

To show what I mean, here’s an example of selecting the projects with the largest ROI (return on investment):

Start with the high ROI project, not with the low or hard-to-quantify one.  The first project normally bears the biggest cost because the start up usually involves setting up the data warehouse. If it can be done with a large ROI project, future projects are much easier to justify…

The most relatable chapter for small businesses is Chapter 4. The author, Bill Franks, gives a good foundation of how Web data is the basis for doing more than accounting Web traffic. He offers a refreshed look at the worth of non-conversion traffic - the 96% of website visitors that do not click an intended button or submit a fill-out form.

This segment is worthwhile for small businesses seeking a deeper reasoning behind the cost to modify an analytics solution or create a custom dashboard. Many still treat analytics as a form of accounting. As they say in commercials “Wait, there’s more!” Well, Franks explains the “more” with the chapter segment, Web Data In Action. He mentions a few models such as attrition and response modeling. I liked how imaginative Franks take is for emphasizing the customer segments that businesses can develop, such as this comment:

Consider a segment called Dreamers that has been derived purely from browsing behavior. Dreamers repeatedly put an item in their baskets but then abandon them. Dreamers often add and abandon the same item many times…So what can you do after finding them? One option is to look at what the customers are abandoning.

Another solid segment is Chapter 12 Engaging Analytical Talent. This was written by Jeanne Harris (who co-wrote Analytics at Work with Davenport and Robert Morison) and Elizabeth Craig. It gives a brief overview of how to set assignment objectives that shows your organization understands analytical talent:

Arming analysts with crucial information about the business is one way to keep analytics talent engaged.

The ideas were spot on to what’s happening.  I recalled a well-known recruitment firm’s study that indicated analysts changing jobs partly from lack of engagement and meaningful support.  Moreover, Harris and Craig show how to identify “4 Breeds of analytical talent” that deftly conveys the value of each talent.

Privacy issues are noted in Chapter 4, but advocates should read Chapter 13, Governance for Analytics.  Stacy Blanchard and Robert Morson lay out the process for establishing analytic management, the processes that ultimately protect data as much as it extracts value:

Establishing governance is a mix of science and art, where the specific power dynamics within the organization play a significant role.  There is no single right governance model for analytics, but a number of good principles and practices are commonly found among the organization with high-performing analytical capabilities.

Concepts, while meant for large organizations, can still fit a medium sized business, such as guiding principles and understanding why governance is important.  The list “You Know You’re Succeeding When…”  can be modified for smaller businesses that uses analytics and have stakeholders remote from their operations.

Later chapters present cases of large enterprises. A few note the impact of analytics on specific industries, such as retail (Sears) and pharmaceutical (Merck).

Again, this is a book meant for managers of large organizations. But for small businesses looking to grow, it can give an overview that encourages a deeper appreciation for detailed books like Web Analytics 2.0 or Performance Marketing with Google Analytics.

Analytics, in general, forces a business to look critically at how it operates.  Books like this one will provide the right framework for managing those operations for your best business performance.