Success Stories Ep 108 - "New Goals with Cole"

If there's one true thing in life and business is that nothing ever stays the same; companies and businesses are always evolving. 

On today's Success Stories podcast, we'll talk with Cole Lundstrom about the evolution of a career and business. He's the only guest on this podcast I've invited back for a second interview, and the reason is simple, the lessons he most recently learned with his former company, Shirt Agency, has pushed him into a new direction with a new idea called merch troop. 

This episode is critical to hear, because I think it's okay to stop doing one thing and start doing another. Cole will share his thoughts, and we'll get into some ideas about the industry's future that you probably need to hear.

Transcript

Marshall Atkinson 
On today's Success Stories podcast, we'll talk with Cole Lundstrom about the evolution of a career and business. He's the only guest on this podcast I've invited back for a second interview, and the reason is simple. The lessons He most recently learned with his former company, Shirt Agency, has pushed him into a new direction with a new idea called Merch Troop. This episode is critical to hear, because I think it's okay to stop doing one thing and start doing another. Cole will share his thoughts, and we'll get into some ideas about the industry's future that you probably need to hear so Cole, welcome to the Success Stories podcast.

Cole Lundstrom 
Hey Marshall, thanks for having me again. It's always good to see you.

Marshall Atkinson 
Yeah, yeah, and I'm so excited to get into this. And we had a call just to just a catch up call recently, and you know, you told me about everything that was going on, and I'm like, man, we need to get this. We need to get this on the podcast, because I think it's really important to hear. You know, not everything works in this industry, and sometimes you've gotta just stop what you're doing and kill your darlings and do something different. And if you look at a lot of really super successful entrepreneurs, you know, whatever made them super famous was like their 10th company, you know, it wasn't the first one, right? It's because and they learn, and people learn all the way through about how things work, right? And so that's kind of kind of where the emphasis for the show came from.

Cole Lundstrom 
Yeah, absolutely. I see that in the industry too. Like when I've been letting people know that I shut down my shop, there's been so much support, and also they talk about their own experiences, and they open up a lot more. It's interesting to hear kind of the true side of the industry, and not just the positive spin.

Marshall Atkinson 
Right, right, right, all right. So you were last on the show on episode 85 and if you want to, you could go check that one out, which is way back in January of 2024 and things were looking really good for you with Shirt Agency, but seven or eight months later, you decided to close it down and go in a different direction, just so we can get the elephant out of the room, right. What led you to that decision?

Cole Lundstrom 
I mean, I was really good at being busy. We were very good at bringing in pallets of work, having high volume, getting a lot of orders, but fundamentally, we had issues with our overhead costs. We had issues with how much payroll we needed to stay, you know, quick. And then, besides that, I just found myself not paying myself enough, and I realized that I could make more money, either with a good salaried position or doing things on my own and not being tied to the overhead in the business. And so that was ultimately what it came down to, was I needed to focus more on money for my family and not about constantly being busy with the actual shop.

Marshall Atkinson 
So did you try what did you try to pivot or make it better, or raise your prices, or lower your costs, or all of that stuff? Because I'm sure people out there are thinking that.

Cole Lundstrom 
Yep. I mean, I definitely had plenty of pivot moments. I think fundamentally, what I did is I had built a shop that was kind of premium, kind of high, high end. And I would get opportunities to print for someone like Blink 182 but the problem is, those kind of customers will give you 82 cents aside. So it's exciting that you're doing a known brand, but you also find that when it comes down to a screen printing as a commodity, and you simply aren't going to be able to charge the premium prices on the high volume work. And I think I didn't necessarily understand that as I was building what became a more and more expensive overhead. And since I wasn't building my clients with smaller clients with a higher margin, I was keeping myself extremely busy with relatively low pay work.

Marshall Atkinson 
Yeah, well, you know, you can actually get more money for things. It's just you weren't doing that. So, because I know people who do that, right? So, were you measuring this stuff? Were you did you have KPIs you were tracking? Were you looking at your gross and net profits? You know? Just as a dashboard looking at that every week or every month or whatever.

Cole Lundstrom 
Yeah, we had a bookkeeping service that would give us P and L reports that we could access pretty much in real time. And then, besides that, we also had the basic analytics that are inside of like Printavo, so we were able to able to see our revenue. I think that I one of the issues I had was I would have a month that was $140,000 and then I would have another month that was $68,000 and it felt like a completely wild roller coaster swing. So in one month, I'm wondering how many people I need to hire, and the very next month, I'm at almost half the revenue. And so having that consistent order flow was a challenge that I personally didn't ever really nail down, because I didn't really build the right team around me.

Marshall Atkinson 
And did you have sales people like there were out there hunting and bringing you back business and filling in the gaps for you? Or is it just you?

Cole Lundstrom 
It was me and Joanne, my wife.

Marshall Atkinson 
Right. And I think that sometimes, you know shops, especially where you know the owner wears all the hats, right, we get into a big challenge where there's not enough time in the day to do everything, and then, like, there's so many balls you're juggling, and sales is the life blood of the business. If you're not bringing that in, then you've got serious challenges that show up in other places, right? And so do you think if you had a bigger sales team or a different sales process, you know, just looking in hindsight, that things might have turned out differently?

Cole Lundstrom 
Yeah, absolutely. I mean, I've seen the shops that I admire do really well with the right sales people in place. One of the issues, I mean, we certainly tried at different points to bring people on. What I felt like was to pay a sales person properly. They needed to bring in about 350,000 plus, in new customers. And I didn't seem to get that balance of a person who was actually capable of doing that for the right salary. And we definitely had different people try at different points, but I felt like a lot of times they were kind of just answering my emails for me and handling our existing customers for me. They weren't doing that outside sales thing, and that's what I think people like Kevin are really good at, is training those kind of sales.

Marshall Atkinson 
Kevin Baumgart, you mean?

Cole Lundstrom 
Yes, but his set sales, I every time I talk to him, I'm like, I should have done what you said, Kevin, but I, I guess I'm it was something that I didn't focus on because I was always stuck in my day to day flow.

Marshall Atkinson 
Yeah, that brings up an interesting point. Why do you think people you're a smart guy, right? Why do we not do the things that we know that we need to be doing? Why do you think that is?

Cole Lundstrom 
I think it's a balance of like, high level thinking versus the emergency. So it was always I need to bring in X amount of revenue right now. I need to run this job right now. We're going to run overtime right now. And so I had an infinite list of things I wanted to improve about the business, but it always felt like it still just fell on me. And so I would just be burnt out when I finally was done managing the shop, and so that's where building a team around yourself was something I really needed, and I never did, right.

Marshall Atkinson 
Yeah, as a business coach, one of the things that I talk about all the time is replacing yourself, right, especially with what I call chore work, you know, so like in your house, you gotta cook dinner and take out the trash and mow the lawn and feed the dog or whatever, right? We have those chores in our businesses as well that that has to be done, but it doesn't really matter who does it like doesn't matter who puts the information in the system or who emails the client, or who is doing some of these things that we found yourself always doing. And if we can find people, processes, software, whatever, to handle that, then we can move on to things that are more important. And so anyway, so All right, so let's just kind of pivot right now, and let's and let's talk about your new thing that you're doing, right? So you decided, you know, I'm going to shut down Shirt Agency, I'm going to start a new business, and it's called Merch Troop, right? That's the name of it. So, like, talk about that, like that transformation, where you say, You know what, I'm going to stick with the industry I'm not going to go into, like selling insurance or something, right? I'm gonna stick in the industry. I'm gonna do something else. How do you decide on what to do? Did you write a business plan? Did you talk to people? I mean, what kind of like? How did you filter everything out into okay, this is what I want to do and and move forward. Would you do?

Cole Lundstrom 
Yeah, I mean, so my I wrote a business plan, but not quite the traditional way. I've been getting really deep into like chat GPT. And so I basically would have ranty conversations with chat GPT about how to optimize and what we were going to do. And so what I wanted to do was carve out what I saw as the easiest things that also were the most profitable within what we were already doing. And so ultimately that became live events. So we're doing live events with our partners who are able to show up literally anywhere nationwide. And that is an incredible opportunity, and it pays really well. So the live events have been a big part of it. Besides that, I'm capable of now just brokering jobs with print shops and not having to worry about having any sort of slowness with the brokering. And we also did a DTF solution that goes straight to print shops, which is just a really easy to use transfer. And all I'm essentially doing is showing people that it exists, but I don't have the machines, I don't have the overhead. I simply like connect with print shops. So I basically created merch troops so that I could do things that were relatively low impact as far as my time was concerned, but had, like, healthy margins, and I eliminated all overhead that I had at shirt agency.

Marshall Atkinson 
So essentially, you could be on the beach with a laptop and run your business.

Cole Lundstrom 
Yeah, I mean, I literally was like, in a recliner on my phone the other day for like, three, four hours. I never even got to the point of opening the laptop.

Marshall Atkinson 
So it's the Tim Ferriss Four Hour Work Week, you know, Cole style.

Cole Lundstrom 
Yeah, kind of, I mean, I just want to be able to maximize, like, what I'm good at and what I'm good at, even though I'm perfectly capable being a floor manager of a print shop, it's not going to pay me all that well. And so I wanted to get myself removed from the actual production and get myself on the sales and marketing side.

Marshall Atkinson 
Okay, well, that makes a lot of sense. So when you were thinking about building this right and and you just learned a valuable lesson with the old the old shop, right? Did you earmark the quicksand, the things to avoid, you know, the the danger zones, right? Did you like kind of think about those things that you just went through? So, you know, because if you pay the money and do the stuff, I was odd, chalk that up as tuition, right? And either you learned the lesson or you didn't learn the lesson, right? So did you, like, think about all the negative things that you just went through to make sure that that doesn't happen with the new business? And what did you do?

Cole Lundstrom 
Yeah, I mean, I basically created a business where I have no costs, and so, like, my cost right now for the new business are like a square space subscription and an Adobe subscription. And so what I wanted to do was not have the fixed cost that would eat me alive, because I would have a bad month back then, and I could lose 10,000 $15,000 in a bad month. Now, if I have a bad month, I'm just don't make money. That's it. And so I wanted to eliminate all that risk and overhead with the new business, so the new business has zero debt and it has zero overhead. And that was, like, the main focus with it. I didn't want to, like, go and have a smaller shop. I didn't want to take shirt agency down, downsize to a smaller building and, like, try to make it work, because I already owned equipment. Instead, I wanted it to be like a fresh start where I basically am responsible to no one but myself, and I'm not in charge of, you know, creating the livelihood for an entire team through payroll.

Marshall Atkinson 
Yeah, right. So what processes, KPIs or whatever have you implemented right now to ensure that you're going to have the success that you want? What are you What are you constantly looking at?

Cole Lundstrom 
Well, at the moment, the because a lot of what I've been focusing on is the transfers, I'm actually more interested in the leads coming in at the moment than, like any sort of raw revenue. So I've been playing with looking at the actual returns on any sort of small ad spend, and also just social media posts and what those leads can convert to. So talking to like anywhere from five to seven print shops daily, is my like existing current standard and getting them signed up. Besides that, for the live printing, we've been trying to make sure that we're booked three weekends out of the month, and so going and expanding that to different marketing companies so they even understand we exist, has been another kind of sales focus of mine.

Marshall Atkinson 
Okay, so those are the KPIs you're tracking. Do you did you make a little spreadsheet dashboard? Are you using a software tool? Is it a whiteboard? We just do a click tick mark. I mean, is it just all in your head? I mean, what? What are you doing?

Cole Lundstrom 
A lot of it is in my head. But besides that, I've got HubSpot. So HubSpot is allowing me to do the follow ups, keep everyone organized, and also manage any incoming leads, so that they're automatically in the CRM and they're getting reached out to in basically a consistent to do list for me,

Marshall Atkinson 
Right. And I know you're big on automation, so that's handling that for you, so you don't have to constantly monitor it.

Cole Lundstrom 
Yep. Things like Zapier, allows you to just click, click like a square space, space website form, and it automatically will fill into something like a HubSpot, and it's seamless.

Marshall Atkinson 
What is your biggest challenge right now you think is just making people aware that you exist and what you're doing?

Cole Lundstrom 
Yeah. I mean, my challenge is Shirt Agency had a ton of great SEO value, so I was ranking really well in the past, and so people were finding me organically through Google search, and the new company has basically none of that. So my biggest thing is reaching out and being found without spending an exorbitant amount of money, because people can always just spend 1000s on ads, but they don't necessarily always have a good ROI. So I'm trying to build up that credibility for merch troop, that Shirt Agency used to have.

Marshall Atkinson 
Yeah. So I have a Midjourney newsletter, and so I am currently ranking number one on Google for Midjourney newsletter. It's Midjourney Experience, and I don't pay Google anything, right? And and all of that is through my speaking and showing up and doing things and being active in the Midjourney kind of eco sphere, if you will. Right? I also teach classes over because we live in the internet age, right? I want to leave my house, and I can take classes in Europe, right? And so because of that kind of a thing, when you type in, you know, Midjourney newsletter, my thing is the number one thing that ranks right. And so for those of you guys out there that are interested in building better SEO, it's like, you need to show up. You need to leave bread crumbs out there. So the the little algorithms that Google uses will find you and give you a ranking, right? And so are you do doing that now Cole, where you're like, leaving those bread crumbs and kind of forcing that into the system?

Cole Lundstrom 
Yes, so there's, there's kind of simple things you can do, like submitting yourself to directories, obviously. But besides that, I do things with Impressions. I'm a speaker with them, and I also create some internet contact content with them. I also will be making some content with like dtfprinting.com and so those types of backlinks and relationships work well also with our podcast, the building your T shirt Empire podcast, depending on how you search it, we're typically ranking in the top one to three. And so every podcast episode for that, we have the URLs included as well, and so that allows us to get more faculty traction.

Marshall Atkinson 
Great, awesome. All right, so do you feel like this new venture is like the natural evolution of your career, right? And when you think about, you know, 20 years from now or whatever, how is? Is what you're doing now aligning with your goals that you might have personally, or maybe in the market or maybe in the industry. What do you think about that?

Cole Lundstrom 
I mean, 20 years from now, I don't know that I'll be doing Merch Troop. I've been doing some partnerships with some fairly large companies in the industry, and some of the things we're doing in our partnerships, I'm really excited about so I could see myself ultimately ending up with one of the larger players. Just because I do like working with a team, I don't I spent so long being the boss, and I don't necessarily like being the boss, and so potentially being a part of a team, whether as some sort of, you know, contract person, or, like, a long term salaried position is really interesting to me, as long as I enjoy the project. For me, merch troop was a way for me to find the most possible money for myself. And so that's kind of how I built the pricing and how I built the structure. So we're offering still fair pricing to all the customers, but I created something where I can finally make sure that just my family is getting a large amount of money, and I'm not generating all this gross revenue that essentially breaks even. And so that was, like the clear, obvious, quick focus for Merch Troop was maximizing my own net profit.

Marshall Atkinson 
Right. Okay, so what do you what do you think about next? You know, you know, when you're thinking about what merch troop might be getting into, what is there something that you if you had just two more pieces of information, you might be doing something new. What are you thinking?

Cole Lundstrom 
Well, I mean, what I've always wanted to do was create, like a large scale network where the print shops are essentially working together. So these big companies, like Custom Inc, they have their own network that they keep private for use for themselves, to send out to contract decorators. What I've always wanted to do is kind of build an open version of that, and doing something like that with merch troop would be really interesting, where we're bringing in as many like DTF transfer orders as humanly possible, for example, but the network is helping produce it. So as you expand and grow, you're helping additional print shops be busy and get a constant order flow. But you're not necessarily treating it like your private network that you're going to nickel and dime, which is what happens with some of these larger contracts with at Shirt Agency, we did a lot of work for Fresh Prints, and we appreciated that they would give us like, you know, 30 orders a month, sometimes more, actually, but they were always beating up printers on price, and they were trying to maximize their own profits at all times. It would be very interesting for me to help build a network where it feels healthier for the actual print shops involved. And it's not all about the bottom line on the contract rates, and I've kind of always wanted to do that. So as Merch Troop brings on more and more customers, I'd like to expand a network to support them.

Marshall Atkinson 
All right. Well, you heard it here, call Cole. All right. So last question, right? So I want to chat about the future, right? And it's a crystal ball and it's a crap shoot, and nobody knows, right? So we'll just throw that out of the way, right? What do you see for this year and then maybe a few years from now? Right? So are you doing any to prepare for that? And what I'm thinking about is, of course, DTF, but also AI, the way we sell, the way the markets are working. You know, there's a lot of new things coming down the pike. And of course, there will always be new, the new that we don't even, can't even imagine it, you know. And think, you know. Think six years ago, would you whatever's going on now? Could you even think about it? No, right? So, like, just you crystal ball time for you, right? What do you think might happen with everything that's like today? What's the next step the evolution? What are we going to see?

Cole Lundstrom 
So I think DTF has been a bit of a game changer, and it's finally getting affordable and reliable simultaneously. I do think DTF is a bit of a race to the bottom on price. Fundamentally, from what I understand about the machines, most of them are running, you know, essentially an Epson print head, and then they are built around that. And so there's not necessarily anything about them that doesn't make them a commodity. So I think we'll see the prices of DTF potentially actually come down even more than they are currently. And I also think that a lot of screen printers are going to be accepting more and more that it's not worth setting up most jobs. And so what I saw with my customers is once I stopped explaining inks and asking them their opinion on inks, what they really needed was an image on a t shirt. And so I. The transition to DTF was stupid easy when I didn't explain, like, do you want me to do this? Do you want me to do that? I just gave them their finished garments, and they loved them. And so I think more and more screen printing shops will learn that, because they all take pride in their work. They see it as like an art and a craft. But fundamentally, there's a lot of jobs that simply are more profitable because you can cut your labor down by not doing all the screens, all the cleaning, all the burning. So that'll be interesting to see. That transition screen printing definitely still has a place, especially in volume, but on those, you know, 50 piece, 100 piece orders with a lot of colors, I think a lot of that's going to go away. I think that'll affect the equipment manufacturers, because the environment that I'm seeing doesn't seem very hungry to buy. And so it'll be interesting to see how the equipment manufacturers have to pivot. And then beyond that, if you go like, deep into the future, because of DTF, someone's going to nail, essentially, the Amazon Prime of T shirts, where they're going to have, like, nationwide distribution and DTF or DTG solutions that are getting orders out, you know, in 24 hours, so it's at your door within two days. And I think that kind of solution, which I know they've flirted within the past, and Amazon merch was trying to do something similar, but I think the technology works better now, and you're not dealing with like, the core needs of like 2018 you're now dealing with machines that are far cheaper and easier to use, and with things like inline cutting attached to DTF, you could have some really efficient production facilities that are outputting essentially two day shirts, which would wreck the industry For local mom and pops.

Marshall Atkinson 
Yeah. So those are all really great points to me. I also think we're going to see a resurgence in screen printing, and not for just the DTF thing, you know, because once you know how it is, a pendulum springs one way, sooner or later, there's rebellion, and it swings back a little, right? And I think you're we're going to see there's a craftsmanship question that's going to come up. And of course, this is going to be in larger orders, not smaller orders. But what's going to happen is the newer people coming in the industry aren't going to know anything about screen printing, because they're all going to be DTF people, because you can do that with virtually nothing in the kitchen or your barn or your basement or whatever, and but they can't do a large order. And I think the folks the shops that know how to do screen printing that are set up for larger runs, I think you're going to see a really big resurgence in that as a skill set and, and, and because of that, I think people are going to be able to get more for those Types of prints, because nobody understands this stuff, right? And it's a it is an art and a science and a craft, and there's a lot of really very specific steps you have to do to have a fantastic outcome. You know, anybody can screen print a shirt, but not everybody can screen print a shirt. Well, right? Okay, we've all seen junk. Okay, have you been to Walmart? You know, we've all seen junk, right? But I think the people who really have their hands on it, I think it's going to be just, there's going to be a lot of people interested in that and, but I don't know when that's going to kick in, you know. And I just, right now, everybody's so focused on DTF, and I know a lot of the equipment manufacturers are hurting because of it, you know, I've laid off people, and, you know, friends of ours, you know, I know you you've got friends in a business that have lost their jobs, and so it's like, you know, and that, and they're right to do that, because if you can't pay him, you can't have him on the company, right? But I think it's just going to be really interesting to see how the next 235, years shakes out. And I think we're going to see some consolidation. I think we're still going to see more conversions, where we have more and more companies coming together, because that's what you're going to do, to buy customers or keep the lights on right. And I don't think that's going to go away. So, you know, it's going to be very interesting.

Cole Lundstrom 
I think it is going to be very interesting. And I in no way think screen printing is dead. There's, like, a ton of very valid use cases. And I also think there's going to be an element of, like, the vinyl effect. So in the same way that people still buy vinyl records because of what they prefer, you'll see that where people are like, I don't care that you're. Essentially charging me more. I want a discharge t shirt done right, because that stuff the DTF will never get right. They're also not going to be able to handle most like glows, fluorescence, but they're foils, like a lot of that the DTF solutions for either don't exist or they look bad. So there's a lot of places where screen printing can thrive, but the people who are going to do it will have to be high level screen printers, because the local cheapy work, I think most of that is going to be switching over to DTF.

Marshall Atkinson 
Yeah, yeah. Well, all that's really good and so anyway, so thanks a lot for sharing your stories. Successful today. Cole, yeah. Cole, if I know a lot of your contact stuff has changed, so maybe you need to get that out there about how to call you, because you're no longer with the old email address, right? So if someone what's the best way to contact you? If somebody wants to know how you can help them or get more information.

Cole Lundstrom 
yeah, cole@merch troop.com and merchtroop.com is the main website, and there's also a contact form on there as well.

Marshall Atkinson 
Awesome, awesome. Well, thank you so much for being on the show. Cole, appreciate you.

Cole Lundstrom 
Yeah, thank you for having me, and thanks for everyone listening.