Less is More
RedWhite Apparel is a simple company. On the company payroll there's only 1 staff (me). Corporate HQ is a table in an apartment. And we only make bibshorts.
It wasn't always like this.
Between 2017-2019, RedWhite Apparel made the following products :
- Jerseys
- Baselayers
- Water Bottles
- Gloves
- Socks
Why did I do this? Pursuing Growth.
RedWhite Apparel started in 2014 with a simple mission. We wanted to make bibshorts that help you ride further, comfortably. It was a simple mission and born out of a personal struggle to find bibshorts that just work and don't cost their weight in gold.
2 years in, I started thinking about growth and decided to make other products. Product line expansion is a classic way of growing a business after all. The new products added 25% to RedWhite's revenue.
This came at a cost.
Managing 5 new product lines is expensive. It sucks capital and focus away from the bibshorts that this brand is well known for. At the peak of this product line sprawl, I had :
- 12 Jersey colours in 6 sizes (total 72 SKUs)
- 3 Baselayer colours in 6 sizes (total 18 SKUs)
- 4 Water Bottle colours (total 4 SKUs)
- 7 Sock colours (total 7 SKUs)
- 5 Glove colours in 6 sizes (30 SKUs)
Total : 131 SKUs
Keeping 131 unique SKUs (Stock Keeping Units) in stock and managing them efficiently is difficult. The inventory was expensive with poor ROI. They didn't add enough value to customers' lives. Many other companies do these 5 items well.
They also robbed my focus from what really matters - bibshorts.
Back to Basics
In late 2019, I decided to go back to basics. I ditched all the above products and re-focused the company on bibshorts. RedWhite Apparel only has the following products :
- The BIB Bibshort, 3 colours in 5 sizes (15 SKUs)
- The BIB Women, 2 colours in 5 sizes (10 SKUs)
- The BIB Thermal, 1 colour in 5 sizes (5 SKUs)
- The Entry Bibshort, 1 colour in 5 sizes (5 SKUs)
Total : 35 SKUs
This small number of SKUs allows me to allocate capital efficiently. Including the other products, I used to have 166 SKUs that had to be kept in stock. Capital was stretched thin and not every product could be kept in stock to meet demand. When demand is unmet, sales drop.
Having just 35 core SKUs that we are best known for allowed me to keep everything in stock, more often.
Having fewer core products to manage also freed up more time for me. I am now able to :
- Offer better & more personalised customer service.
- Write more articles like this that gives you some insight into my thinking.
- Spend more time developing products that customers want.
Some of the stuff that I am actively working on are :
Less is More
Simplifying RedWhite's product line and deciding to kill product lines that were contributing 25% of revenue was a difficult decision to make. However, almost 1 year on, the lost revenue has been more than replaced by increased sales of the few products I currently carry.
RedWhite Apparel is also a far tighter company today than what it was in 2019. Capital is deployed more efficiently. Each product has a strong reason to exist. Warehousing costs are down because the number of SKUs is only 35.
Cyclists also seem to understand what we do easily and this has helped me to communicate the brand's value proposition easily, generating more revenue as a result.
Simplifying has yielded more benefits. Less is more.