Business View Magazine interviews Viktor Kostroub (CEO) and Mike Janssen (Director National Sales) of Fine Designs for our focus on Top Retail Franchises.
For over 20 years, Fine Designs has been providing on-site customization of the latest trending fashion apparel at sporting events, festivals, music concerts, and more, around the world. The company’s innovative business structure delivers quality merchandise, custom embroidery, and screen printing, as well as exceptional customer satisfaction, right at the venue – at no cost to the event host. It also provides complete custom apparel printing services in-house; offering organizations bulk online ordering and wholesale options for all products.
Fine Designs CEO, Victor Kostroub, describes the company’s beginnings and the mantra that has spurred its remarkable growth. “Fine Designs started in 1994 as a simple idea: ‘How do we do something for competing athletes that they will remember through the years?’ Because a lot of those athletes were in school, or in college. But years later when they open their closet now they can share their achievements with their kids. We create quality souvenir apparel that will stay with them for a long time. Just like their medals.”
“Something like this was already in the market,” Kostroub continues, “but my co-founder and our current CFO, Yuli Opalchuk, and I wanted to add something more personal to the level of service. It’s not about the T-shirts, it’s truly about the people. I’ve seen so much of what these athletes do to get where they are; building a road to qualify for the Olympics or to just surpass their own expectations for what they can accomplish. It makes you think about your business differently because you have relationships with the people who host these events, as well as the athletes and their families. Our vision as a company is all about honoring and serving people, whether that’s our employees or our customers.”
In a nutshell, Fine Designs sells souvenir apparel with a unique event logo, on-site, at sporting events and other large gatherings. T-shirts, sweatshirts, tank tops, jackets – the company has their graphic artists create a design and also offers a large variety of sportswear. People come to the booth and see a large collection of logos. They can then decide whether they want to put a small logo on the chest, their name on the back, or another logo on the sleeve; everything can be customized right on the spot.
Before each event, a member of the Fine Designs team contacts, or is contacted by, the host event director. Fine Designs then signs a contract with them agreeing to pay the event a percentage of the sales. Kostroub says, “Of those contacts, 30 percent call us, another 30 percent are set on multi-year contracts, and 40 percent are new business. Each of our franchise offices has a research team that works in our CRM, Salesforce. The research team works by adding new events in Salesforce.” While there are many others competing for sales, Fine Designs does most of the major events throughout the U.S. They attend between 90-200 events each weekend all throughout the United States, Canada, Europe, and Australia. Fine Designs always asks for the exclusive rights to provide customized-on-the-spot official event merchandise. In total, they have close to 700 employees, with 80 percent of business taking place in the United States.
Mike Janssen, Director of National Sales, explains what sets Fine Designs apart from the competition: “As a National Account Executive, I go out and sell our company’s services to what Victor calls ‘the big fish’ – larger scale events and/or sports organizations. I was formerly an event director and used to partner with Fine Designs to come and provide apparel at my tournaments. I was so impressed with the unique business idea that I started working for them. Today, I now co-own our Fine Designs Great Plains franchise office with my business partner, Mark Kramer. Our office services a five-state territory of Iowa, Nebraska, North and South Dakota, and Minnesota. Any given weekend we may be doing tournaments for hockey, dance, basketball, volleyball, indoor track & field – anywhere we can sell official merchandise.
“What makes us different is, we come to the event with much more merchandise than most of the competition. For a middle-of-the-road production, let’s say a $10,000 event sale, we’ll bring upwards of 30 different styles. That’s unheard of in our industry. We also bring a significant amount of artwork graphics for additional customization. We’re always updating our range of styles and selection of generic logos, so the latest ‘cool’ phrases or hashtags that kids and teenagers use will be on our shirts. And they’re available both on-site and online.”
Customer service is another key component. Franchise owners have very strong standards for the kinds of people they actively recruit to represent Fine Designs on event weekends. The company values transparency and, because of that, gives detailed POS reports to their customers. The last few years, they’ve focused on convenience for event directors, providing surveys for customers that contain their event information from the previous year to make the planning process much easier for them. Fine Designs currently has 23 satellite offices, operates in every state and is currently expanding their team in Canada. Three of their satellite offices are in Germany, England, and Romania. A conference in Germany in late April will bring together these three offices for networking and collaborative discussions about the future. Expansion in Europe is a big goal for the firm, this year.
Kostroub weighs in on the company’s culture of teamwork: “The relationship among the employees inside is the same as how they serve outside with customers. The atmosphere in the office is one of truly working together as a team. When we go to events, we offer consistency. People rely on us. Whether we’re on the east or west coast, you see the same setup and service. It takes a lot of training and work on recruiting staff who share the same values that we have as the founders, and as the franchise owners; to serve people and think of others behind the sale and appreciate the event directors, and athletes and their families.”
Average growth for Fine Designs is about 17 percent, annually. Going forward, Kostroub describes how that will continue to increase. “My vision was to have each new franchise owner start with five states that they personally oversee,” he explains. “When Mike and Mark took over our Great Plains region, gross sales for that area were $1 million for all five states. Their job was to take that to the next level – $5 million – with each state generating up to $1 million. The growth they achieved was very organic, it was through hard work, delegating responsibilities and hiring people they could trust. This is how we grew from 23 franchise owners to 50.”
As for new innovations that are impacting operations, Director of Communications Abby Rinzel relates, “Two years ago, we made a big investment and implemented Salesforce as our main CRM. We plan our events and communicate with each of our offices around the world on this one system. It ensures that our level of service is sustained everywhere, and brings together managers, account executives, and people who sell apparel on-site. Switching to a new operating system was difficult in the beginning but worth it because of the difference it’s made in each of our offices, from Texas to Germany, everyone of our staff has benefitted.”
Looking ahead, Kostroub forecasts, “Our company will be almost twice the size, but the vision will be the same. We want to empower our clients and customers to achieve the extraordinary. We do this by adding a personal touch in everything we do. You can see it in the artwork we produce, in the relationships built by our account executives, and the servant leadership you see from each of our franchise owners. We think of the clubs we work with as partners. I heard a saying once that said, ‘It’s not who you know, it’s who knows you and what they say when you’re not around. That’s your brand.’ This is truly what I believe and what I want our company to embody, acting with uncompromising honesty and integrity in everything we do.”
Long-term partnerships create valuable continuity for the company. Janssen reports, “We’ve been partners with the NAIA (National Association of Intercollegiate Athletics) for almost a decade. We do all their National Championship events throughout the U.S., every year. We also do a lot of day-to-day work with large wholesalers where we buy our merchandise, one being Alphabroder, the other is SanMar. We purchase a huge number of T-shirts annually and it’s super important to our business model to keep our margins. Any kind of fluctuation in prices makes a big difference.”
Rinzel adds: “We enjoy being involved with the AAU (Amateur Athletic Union) and other large organizations, but we also exist to work with smaller local clubs. A significant percentage of what we make on-site at events goes back to the club that hosts the event. It boosts their fundraising efforts by helping the club to stay afloat financially and this consequently helps keep local children and teenagers in sports and extracurricular activities. We believe that keeping children involved in sports can change their lives by building character through discipline and teaching them how to overcome adversity.”
According to Janssen, “There’s not another company in America that can serve the grassroots, small-level competitions nationwide, simultaneously, on the same weekend, and then three weeks later go and do a national championship event that does over $100,000 in sales. We support the events in the local communities, but we’re also the best at maximizing revenue generation at the big events, too.”
Says Kostroub, “This is what truly makes our company so attractive.”
AT A GLANCE
WHO: Fine Designs
WHAT: Customized on-site event apparel
WHERE: Headquarters in Tukwila, Washington