This article about Knights Apparel by Steven Greenhouse appeared in the paper not too long ago, and I have been thinking about it.
There’s some great rethinking going on at Knights Apparel, and CEO Joseph Bozich is trying to take a “how” trap view at employment practices and wrap his brand around it. He thinks it matters “how” he treats his factory workers, unlike lots of other manufacturers who infamously run sweatshops (and people keep buying their products).
The short of it is that his company is making college logo clothing but they are bucking the trend of using sweatshop conditions and wages. While I think that’s admirable, and the right thing to do, and I think it’s great that they are going to get so much promotion from third party labor organizations to buy these products because of their labor policies (mentioned in the article), I don’t believe that alone is going to sell hats and sweatshirts when one with the Nike swoosh is right next to it at the same price.
Why?
For the same reason people didn’t stop buying Patagonian Toothfish (AKA Chilean Sea Bass) when word got out that the population is at risk. It tastes good, and that fish economy doesn’t directly affect our lives.
For the same reason cars like the Prius aren’t anywhere near as sought after as the Tesla Roadster. Sure we want to help the environment, but if it’s funny looking and slow and it’s not really going to be cheaper in the long run (Prius), then I will go for the Tesla which is really fast and good looking (which also isn’t going to be any cheaper in the long run).
For the same reason Newman’s Own wasn’t primarily successful because it gives 100% of its profits to charity. It was successful because it is a really good line of products and Paul Newman is a great brand. The charity is nice, but that’s not the number one reason they are a big success.
For the same reason that customers don’t care that Costco isn’t making any money selling the products that they sell. They make their profits from their membership dues.
For the same reason that customers (except me) don’t care how alice.com makes money when they are selling consumer packaged goods over the internet at cost with free shipping. See earlier posts about Alice to learn about their model.
So what is the #1 key to success at Knights Apparel?
Just like Newman’s Own, the product has to be good in its own right, and if the product is as good or better than its competitors, only then will secondary issues like working conditions of the employees come into consideration. Thankfully, that appears to be the case as indicated by this quote from Greenhouse’s article:
“Mr. Bozich says the plant’s T-shirts and sweats should command a premium because the company uses high-quality fabric, design and printing.”
If that’s true, then they have a great shot at making a go of this. I can’t help but see the admittedly awkward irony that this is the one place that makes sweats that isn’t a sweatshop. . .
I am rooting for you Knights Apparel, and the next time I am in a college clothing shop (probably not Duke’s – mentioned in the article, since I went to Georgetown), I will look for it.
-Ric
Great article Ric!