Fastlane Test: Can you Spot the Need?

[MJ DeMarco]

How many of you can spot the Fastlane need?

Take this test:

1) Read article (the article's link is listed in *official* article below)
2) See if you can spot the "Fastlane" opportunity.

http://www.fastlaneentrepreneurs.com/2012/can-you-spot-the-need-and-the-fastlane-opportunity/

Take aways:

• Fastlane opportunities sometimes take YEARS to solve (Think ZAPPOS); the quick business solutions often have quick business lifespans. (Due to low entry, or no entry.)
• Opportunities can be found anywhere.
• "It's too hard" is the opportunity.

 

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[PatrickP]

hmmmm well I hate to embarrass myself by guessing wrong but here goes.

Sell clothing to stores on consignment?

 

[MJ DeMarco]

Sell clothing to stores on consignment?

Yup, which also lends to the opportunity to serve smaller clothing manufacturers looking to get their foot in the door.

I'm not familiar with the industry, but if all retailers would love to cut holding and inventory costs, and it is easy to do so (at this point, it probably isn't easy) then I can see it being a big opportunity, or one being done, but not well.

 

[PatrickP]

WOW I am genuinely shocked that was correct.

Next time I will wait a before answering

Have you seen that TV show where contestants design clothes and then Nemien Markus, Lourde and Taylor and a third store (I may have the names wrong) bid against each other to carry the clothes if they want them? It is pretty cool as you see right away if they will be bought by a store or not and then they say they have them up for sale online that day.

 

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[BeingChewsie]

hmmmm well I hate to embarrass myself by guessing wrong but here goes.

Sell clothing to stores on consignment?

That is what I saw too.

You'd think this would be common considering they do it with left overs, like Overstock. I'm not familiar with the industry, and maybe I'm way off, but it would seem that if you sold on consignment in smaller quantities (which is what retailers are doing anyway), you could take back the things that didn't sell and then resell them at a discount to countless places like Overstock, ebay, amazon, e-commerce sellers. I don't know maybe the transport costs are so high and maybe the original vendors would require you to buy so much that it wouldn't be worth it. You only need a few to shift to that model though to change the tide.

Maybe smaller specialty stores could collaborate or form like consignment co-ops to buy on consignment from the company that did this. These private social shopping things like Zulily are super popular, well stores are run by people that get caught up in those kinds of frenzies and "gots to haves" too...maybe that model would work to move enough product initially to offset what you would lose taking merchandise back? I love trying to solve problems, it is like a puzzle, you know the pieces are all there, you just got to find them!

 

[Jill]

Consignment suppliers.

 

[MJ DeMarco]

Consignment suppliers.

Sounds so simple and easy -- however I'm sure its a logistical and management nightmare.

 

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[Milkanic]

Do any industries operate like this today in the U.S.?

I worked at a electronics retailer in college and I believe the majority of music and games (CDs) were vendor managed and shipped just in time via UPS/Fedex.

 

[PatrickP]

Sounds so simple and easy -- however I'm sure its a logistical and management nightmare.

This is what I was thinking. My goodness the headaches of taking back various clothes in various sizes some you may only have an XXS and you need a medium for another store.

Ugggg I would not have the patience for something like that.

 

[PopEmersen]

Running this through my head, it sounds simple. I have some steps below, let me know if this correct.

Step 1: Lease a warehouse
Step 2: Advertise that you will pay for clothes (similar to plato's closet)
Step 3: Have people come to the storefront either near the warehouse or attached.
or have people send them to you
or just buy from ebay
Step 4: Find a commercial cleaning company or dry cleaning company.
Step 5: (Probably the hardest) Get your company's name out as a supplier to niche stores

 

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[PatrickP]

The article is about new designer clothing.

Who would be selling you new clothing?

Then you have to send them to stores who do not pay you until they sell. If they don't sell you have to pay to have them sent back to you, then send them to another store on consignment.

 

[PopEmersen]

Sorry, i thought consignment was for used clothes

 

[mlangley]

Sounds so simple and easy -- however I'm sure its a logistical and management nightmare.

Yes and figuring that all out is the Process. Right?

 

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[MJ DeMarco]

Yes and figuring that all out is the Process. Right?

Yup, and that complicated solution is what creates the barriers to entry.

 

[Yussef]

What about the Logistics and cost of moving and storing all of that merchandise to and from, back and forth, sold and unsold, how would that factor into this opportunity?

 

[Yussef]

Oops didnt know someone asked that already

 

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[PopEmersen]

Couldn't you use TJ Maxx, Ross, & Marshall's to balance the risk of bringing inventory back? You sell to retailers on consignment, then anything that doesn't sell, you sell to those 3 stores referenced earlier? Or to Goodwill as a write off?

 

[Yussef]

Someone still has to package, ship and pay for the products to get there in resalable condition. If you are counting on the retailers that are returning it to make sure everything is peachy..you will have big problems eventually. Imagine TJ Maxx receiving 30 cases of water stained polos that just happened to catch the brunt of someones leaky roof. You better have some space ready.

 

[brob742]

I think the difficult part here would be trying to get products on consignment from the manufacturer. They are supposed to just give you products for nothing in return upfront? I like the full scale consignment model where manufacturer is consigning to me who in turn is consigning to retailer, but there must be an incentive to the manufacturer...more than even getting their foot in the door. And I would have a problem consigning to retailer if I am buying outright from the manufacturer because that puts inventory risk on me.
What a great problem to solve though.

Thanks MJ for that post. You helped put my fastlane goggles on. I know you see these opportunities on a daily basis because you have been in the fastlane for so long now. It really helps when you spot those needs and share them. It really helps me to start seeing those same opportunities that you see so clearly.

 

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[PatrickP]

I think they meant the business would purchase the clothing from the manufacturer and then do the cosigning.

Not the manufacturer doing the cosigning.

 

[brob742]

I think they meant the business would purchase the clothing from the manufacturer and then do the cosigning.

Not the manufacturer doing the cosigning.

Can someone clarify? If incentive for the manufacturer could be established, I think the full scale consignment model probably makes more sense. Meaning it's consignment through the entire supply chain.

 

[jeandearme]

I'd love to see more tests like these to practice spoting opportunities. I think more than just me would agree on that. MJ, You said that You spot SEVERAL every day - how did You learned it? Could You show us how it should be done right?

 

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