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Success Through Strategy

At Champion Awards & Apparel, “we do a lot of stuff to make a living,” summarizes President and CEO Mike Bowen. Champion comprises nine divisions in 40,000 sq ft in Memphis, TN, with $4.5 million in gross sales each year.

Success Through Strategy

Champion Awards & Apparel, Memphis, TN

At Champion Awards & Apparel, “we do a lot of stuff to make a living,” summarizes President and CEO Mike Bowen. Champion comprises nine divisions in 40,000 sq ft in Memphis, TN, with $4.5 million in gross sales each year.

The second generation of his family in the industry, Bowen wasn’t born with a silver spoon—engraved or otherwise—in his mouth. Bowen’s dad, “idea guy” Marris Bowen started a trophy company while working another job, and his mother, “the brains of the operation,” Susan Bowen took it over a year later. She moved the business from the “living room to a barn, and from a barn to a little sharecropper’s store in 1972. It was the only structure standing she could afford anywhere near where we lived.”

“Seven years later, my dad had another brilliant idea—the T-shirt business,” Bowen said. Bowen and his brother, Kenny, worked at both businesses. With their dad, they started turning a profit when their mother warned them in their fifth year of business that she was going to stop letting them cover their losses with the trophy business’s profits.

When they were older, Kenny decided to handle screenprinting while Bowen ran T-shirt transfer stores, and the family merged the T-shirt and trophy companies into Champion Awards and Apparel in 1979. The company joined ASI and added promotional products in 1981.

By then, Bowen and his brother “were fairly addicted to the sale. We grew my mother’s trophies business and my dad’s T-shirt business, which both combined $3,000 to $11 million in 8 years.” Champion made Inc. Magazine’s list of the 500 fastest growing private companies for four consecutive years, he said.

From 1988–1991, Champion was the fifth largest printer in the country with 225 employees working on round-the-clock shifts. “We weren’t making money but wanted to try to get to $20 million,” he said.

Then, lawmakers passed the North American Free Trade Agreement (NAFTA), which essentially turned North America into a free trade zone. “I read what it was going to do to our business. NAFTA was either a blessing or a curse,” Bowen said.

From 1992, when NAFTA passed, to 1995, Champion went from 225 employees to 30. Their $11 million in sales dropped to less than $3 million. “If I hadn’t have sold 11 pieces of equipment and accessories during that period, we’d be bankrupt like most of our counterparts,” Bowen said.

“We grew the company, went backward, survived,” he said. “It would have been easy to declare bankruptcy, but we went back to selling during the day and making T-shirts at night.”

Today, “I tell folks we have 45 employees doing the work of 200,” Bowen says, noting how efficient his staff is. “We work half as hard because we work twice as smart.”

That’s paid off. Bowen bought his brother and mother out in 2000, allowing them to retire, and focused on learning as much as he could to create a true, well, Champion.

The vaulted ceiling in Champions T-shirts & Awards’ Memphis, TN, showroom contributes to the open and welcoming feel of the shop without a hint of the massive on-site production area.

“I had to learn how to become a CEO,” Bowen said. “I was a super salesman. I was pretty good with human resources and financials, but I wasn’t really good with strategy and structure—long-term planning, futuristic planning.”

Today, “I consider myself a futurist,” he said. “Where is this little business going to be in 3 years, 5 years, 10 years?”

At Champion, he also acts as a coach and teacher. “My talent has always been managing, putting teams together, teaching them to work together. A rising tide floats all boats,” he said. “’If you do what I ask you to do, you’re not going to get wealthy, but you are going to make a good living.’ That’s how we interview people. We’re a team, and if you fit, you fit.”

It’s working. “I have 20 employees who have been with me 20 years or over, and I have 10 employees who have been with us 10 years or over. I have 10 employees that have been 2 years or over, 3–5 who have been less than a year,” Bowen said. “That’s intentional. You have to be intentional to be successful.”

Management Champions

“We’re now in trying to take good to great,” Bowen said. “We’re a good company, but to get the true value out of any business, you have to be a great company.” To get where you’re going, you have to know where you are. That requires metrics for qualifying and quantifying.

“We have a win-loss sheet. It’s our scorecard,” Bowen said. This is shared with every employee who has a direct report, 40 of the company’s 45 employees. (Even employees who are away from their computers can access reports through Champion’s 21 iPhones and 10 iPads that travel.)

There is a manager for each of the nine divisions in Bowen’s 40,000-sq-ft plant—customer care, graphics design, prepress, automatic screen printing, manual printing, embroidery, fulfillment, awards, and web services.

“Each manager is the president of that company—that division,” Bowen said. “We run each division as a separate entity. We combine them under one business. I’m just the talking head of a bunch of really smart craftpeople. These managers are the people getting up early and staying late—the ones who actually do it.”

Bowen goes over the company’s profit and loss statements with these managers. “I’m teaching them financials, teaching them the realities of ‘did the division make money?’”

The metrics gathered cover every aspect of the business, including how many orders are served, how many were solicited by the company, and how many incoming calls were received.

“We don’t spend a lot of time. Just because you measure things doesn’t mean you have to browbeat people about the meaning. If you have the right people, they’ll get it. Essentially, you don’t have to ask them if they did their job—managing by walking around, the old-fashioned small-business mentality,” he explained.

Instead, Bowen knows exactly what’s happening through reports. “Twenty-three employees must send a daily report to me with measurements of what they accomplished that day and what they are behind on or need to get done soon,” Bowen said.

At 7 am each morning, Bowen reads the reports from his home office. At first, employees resisted the reports, fearing the data would somehow be used against them. Then, they realized that the reports were their safety net, allowing Bowen to help them when they needed it.

“I’m not above anything. Guess who the delivery boy is for anything east of the plant?” said Bowen, who lives—you guessed it—east of Champion. “The customer doesn’t care what my title is when I take a box out, so I don’t tell them.”

These are the kinds of lessons Bowen shares when he mixes his passions for teaching and bettering his community. Through a local program that has businesses “adopt” local schools, he has been teaching business skills at his former high school 4–5 times a year since 1990 and hiring interns from those classes for his April–September busy season.

Even seasonal staff members go through Champion’s training program in which they work in each department for a day or two, report daily on what they’ve learned, and take a graded test at the end of three weeks of training.

Online Champions

In Memphis, Champion is a big fish in a small pond. “We’re widely known because we’re a ‘small’ town. That’s a good thing and a bad thing. I’d rather be a little fish in a big pond— so we entered the Internet. We must do that to survive.”

Planning for the future, Bowen has purchased domain names that will allow him to launch product-specific sites that keep the company’s branding while focusing on specific product groups Champion offers.

T-Shirt Champions was the first to launch, beginning as a DIY online design platform in 2013. Using product names and the Champion name will help the next generation of customers find them online because “kids can’t spell ‘awards and apparel,’ and they don’t search for those words” when they want trophies or T-shirts. An awards site, with a streamlined method for designing your award online, is next on Bowen’s plate.

The Internet gives Bowen access to new customers but also give his customers more options for retailers. Slashing prices would close Champion’s doors, so Bowen has come up with other ways to distinguish his company. “Instead, we offer awards in 48 hours at no extra charge. We’re that company that will print T-shirts for a good, repeat customer in 48 hours with no rush fees,” Bowen said. “But we won’t sell you on price. We’re not the cheapest person. We’re gambling on the customer remembering. That doesn’t always work. But we’re gambling that our service is going to make dedicated customers, and we’re lucky that we have an 80% retention of customers.”

The website is certainly working. “Over the website proper, this year we’ll generate a little over six figures on T-Shirt Champions,” Bowen said in late 2015. “Internet repeat business—people sending us repeat orders via the Internet—that’s 75% of the company.”

The company’s success is further boosted by an error rate of less than 1%, reducing waste, and not writing off debt customers. “We decided 15 years ago to go back to the 50% deposit, COD. A $5 million company doesn’t need to give a billion dollar corporation credit. We can’t afford it,” he said. “If I can only tell you four words: Cash flow is happiness.”

Customer Champions

“We’re the company people come to when everyone else says no,” Bowen quips of Champion’s capabilities. In addition to screen printing, embroidery, and laser engraving, Champion has contacts to electroplate, create ornamental iron, and fabricate virtually any custom award.

“We fulfill 50–60 orders per day. That’s what we go by. We don’t go by volume anymore,” Bowen explained.

This means that smaller orders aren’t rejected. “Small order? Give them a price that makes it work for you. They can walk if they want. We don’t make financial decisions for the customer. Everyone will push back, but we have to teach them why those prices are fair,” he explained. Recently, a customer wanted to custom shirts with all-over graphics almost immediately. It was a tall order, and Champion quoted an appropriately tall price. The customer agreed without hesitation. “Just because it was expensive to me doesn’t mean that it’s expensive to you,” Bowen said.

Though Champion’s employees won’t make financial decisions for customers, they will help educate them. “I teach my customer care folks that because they know more about our business than 99% of the people walking the earth, it’s up to them to teach the customer why their expertise is needed,” he said. “You are not just there to take an order. Nine out of 10 customers don’t know what they want.”

The most important question to ask is what the customer’s budget is, Bowen said, and to let them know if it’s not realistic. Champion also will work to find out what a customer is trying to accomplish instead of blindly filling an order for, say, 500 T-shirts. “No one wants 500 T-shirts,” Bowen said. “‘Tell me what you’re trying to do.’”

Bowen, too, knows how to scale back to budget his time. At one time, Champion was the licensee for 85 schools, but they’ve scaled back to the Liberty Bowl, Go Daddy Bowl and some schools, including the University of Memphis. In 2010, Bowen sold Champion’s rights to merchandising at University of Memphis games. That year, he’d been at 75% of the schools 155 event days to “hawk T-shirts.” Selling the rights gave Bowen his weekends back.

That doesn’t mean you won’t see Champion selling apparel at live events around Memphis. “If a nonprofit asks us to sell the product for them, we’ll donate our sales services to the event,” Bowen explained. “Have you ever seen a volunteer sell something? Wouldn’t you rather have my folks that are getting paid and know that they’d better sell something?” The nonprofit pays Champion to make the apparel, which Champion then sells at the organization’s event.

What’s Next?

At age 59, Mike is looking ahead not just to Champion’s future but to his own retirement. “My wife and I are working on this,” he said. “I lived to work till about 10 years ago. Now I work to live. That is a marked change in your way of thinking.”

In a way, all of the good hiring and training he’s been part of his exit strategy. “If I’m a good CEO, the business shouldn’t be reliant on the family,” he said. “I have been working on my exit strategy 15 years ago. Now there are written, strategic moves and discussions with bankers.”

Paraphrasing a book he read, Bowen asks, “What’s the best way to form a succession plan? Not show up.” This concept has helped Bowen make the decision to deliberately step back from the business, working to live instead of living to work. He plans a week of vacation each month, for instance. It doesn’t always happen but he had 8–9 weeks off in each of the past two years.

“It lets them know I trust them,” Bowen said of his employees. “Unfortunately, I’m still digitally connected. I skipped my pager across my trout river years ago. I want to do it with the iPhone.”

When Bowen does make his exit, the family will still be represented thanks to a son and nephew who are staying in the family business and Bowen’s lessons will resonate even if his iPhone is buried on a sandy beach.

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