NA0536

Royal Beginnings Bridal and

Formal: Buying For a Boutique
Lisa Eshbach, Ferris State University
Nancy M. Levenburg, Grand Valley State University

“There is good news on the bridal front: the number of women approaching
marital age (roughly 27) will grow tremendously in the coming years.”
HFN Bridal Report1
On a brisk autumn morning in 2013, Anna Oleson, co-owner and founder of Royal
Beginnings Bridal and Formal Shop,2 securely locked the front door and flipped the
sign in the window to CLOSED. She and her co-owner/husband, Jack, were preparing
to embark on their annual trip to the National Bridal Market in Chicago, Illinois. It
was going to be a great day to travel… and they’d packed up some pasties3 for the trip.
The combination of fall colors and bright sunshine would help pass the time on the
six-hour drive from Michigan’s Upper Peninsula. Unfortunately, the beauty of the trip
down the western side of Lake Michigan would be lost on the Olesons. This trip would
be about re-analyzing their current supplier capabilities and selecting suppliers that fit
their business needs.
Typically, attending the Bridal Market meant selecting new merchandise amidst the
excitement of attending fashion shows and being entertained by vendors. However,
Anna and Jack were weary. Recent delivery failures, “miscommunications,” and strictly
enforced minimum quantity purchasing requirements with their current suppliers had
taken their toll on the couple… both financially and physically.
The key, Anna resolved, would be to figure out how to deal with weighty issues
such as these amidst the show’s excitement and glamor.

COMPANY HISTORY
“I decided to start Royal Beginnings 23 years ago after my niece had to travel over 200
miles to look for a wedding gown! My husband had been doing wedding photography
for years, so working with brides and grooms was very familiar to us. It made good
sense, too. My original research showed that there were about 300 weddings in the
area each year,” Anna recalled.

-----------------------------
Copyright © 2018 by the Case Research Journal and by Lisa Eshbach and Nancy M. Levenburg. This
case study was prepared as the basis for classroom discussion rather than to illustrate either effective
or ineffective handling of an administrative situation. The authors would like to thank Anna and
Jack Oleson for their input and assistance in preparing the case. The authors also wish to thank
John Lawrence, Gina Grandy and Cynthia Ingols, and the anonymous CRJ reviewers for their
helpful suggestions on how to make this a more effective case. An earlier version of the case was
presented at the 2013 Annual Meeting of the North American Case Research Association in
Victoria, British Columbia, Canada.

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 She continued,
Step two was doing research in bridal magazines. I opened the store with a
grand total of ten wedding gowns and a lot of bootstrapping. Somehow we
opened without any loans from the bank. Those early years were challenging,
but so rewarding! There were days where we would have customers come in,
but not purchase anything. It was financially draining when we had suppliers,
rent, and utilities to pay. But, we were able to gain traction financially after
word about our business started to spread. I expanded into bridesmaid and
mothers’ dresses, and then prom dresses in 1991. Today, we also carry flower
girl dresses, tuxedos and accessories like shoes, headpieces and
undergarments.
Royal Beginnings leased a building for the first three years of its existence;
however, it was forced to move to another location when the owner decided to sell the
building. When this happened, the Olesons purchased a former jeweler’s building,
which was located two stores south of their original location. Not only did the new
location have more retail space, but as a bonus, there were three apartments on the
second floor. Over the years, the income from these apartments helped to balance the
inherent seasonality in the bridal industry.
Royal Beginnings’ shop layout facilitated a smooth customer flow throughout the
store (see Exhibits 1 and 2). Upon entering the shop, shoppers were greeted with a
variety of dresses, from wedding gowns and bridesmaid dresses, to prom and special
occasion dresses on rounders. This provided shoppers with the opportunity to view
the array of dresses and accessories prior to making their selections and entering the
dressing/fitting room areas. The fitting rooms, bridal stage and alteration areas were
situated behind the sitting/consultation area. Enormous glass cases holding jewelry
and accessory items (e.g., jewelry, headpieces, purses, etc.) lined both sides of the store.
In addition to Anna, Royal Beginnings employed two consultants during the peak
sales periods (February-September), one consultant during the slower periods
(October-January), and a full-time seamstress who also served as a consultant when
necessary. In the slower periods, Anna and the seamstress often worked in the shop
alone. Over the years, the consultants had been steadfastly loyal to Royal Beginnings,
so Royal Beginnings had experienced little turnover. In fact, the only significant
turnover that occurred was when college-aged consultants graduated. Based on the
sales history, Anna felt that two consultants were sufficient to serve the shop’s clientele.
Prom dress customers constituted most of the business from January until mid-
May. Bridal gowns, tuxedos, and mother of the bride dresses provided the majority of
the June through September sales. Starting in October, the business slowed
significantly; during this time, formal dresses and tuxedos for infrequent special balls
and formal community events represented most of this business.

RECENT SUPPLIER ISSUES

Service – Delivery
As they were driving south on US 41, Jack inhaled deeply and commented, “Well, one
thing is certain… we don’t want a repeat of that February incident.”
Anna wanted to say “Thank-you for once again stating the obvious,” but she didn’t.
She knew Jack was just trying to be helpful… and he was right. Fiscally, they could
not afford to have another “oversight.” The unfortunate “February incident” had
threatened Royal Beginnings’ excellent reputation she had spent the last 20+ years

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 establishing. Reputation was everything with any type of business, but particularly with
a small regional business. And bad word-of-mouth publicity traveled like wildfire.
The “February incident” had begun innocuously enough, Anna recalled. A
customer had ordered five bridesmaid dresses within the supplier’s recommended
eight-week lead time. The vendor had previously provided Royal Beginnings an
acceptable ordering and delivery timeline. However, when the dresses failed to arrive
on time, the supplier refused to accept responsibility. Their contention was that they
could not be held responsible for an “international scheduling variance.”
The problem, as Anna subsequently learned, occurred because while the supplier’s
corporate office was in the United States, since 2005, its manufacturing facilities were
located overseas, mostly in China. The product flow interruption was due to the fact
that the manufacturer did not work during the Chinese New Year, a 14-day holiday.
So while the corporate office in the U.S. had created the delivery timeline and required
strict adherence to it from retailers, they refused all accountability for what they deemed
a mere “publishing mistake.”
In an effort to fix the problem, Anna had spent the majority of the profit from that
sale trying to appease the frazzled customer. While she had tried to explain the cause
of the delayed supplier shipment, it was to no avail. So to mollify the customer, she
expedited the delivery of the dresses at an expense of $300, offered $325 in free
alternations, and finally ended up discounting the dresses by $60. After the wedding
(which, thankfully, occurred on time!), the customer went out of her way to express
her extreme disappointment with Anna and the service at Royal Beginnings. It had
been a nightmare.
Service – Ordering Mistake / Miscommunication
The Olesons agreed that effectively communicating with all of their suppliers was
important and an ingredient for successful business partnerships. They visited their
suppliers at the bridal market annually. Additionally, they were proactive in calling
their suppliers either to request and/or confirm orders and information.
One of Anna’s long-time favored suppliers was Alfred Angelo. She preferred
Alfred Angelo because of the designer’s quality of materials, pricing, style, and
customer service. One specific area that she saw as important was that Alfred Angelo
didn’t charge more money for plus-sized dresses, which was a standard business
practice among other suppliers. She also appreciated the fact that this designer’s gowns
always came with generous seam allowances, which helped immensely when it came to
alterations. Alfred Angelo also offered reduced prices on dress display samples and
had the ability to coordinate bridal color themes using a 55-color palette.
While Alfred Angelo had been a relatively good supplier to work with for 23 years,
Anna had been taken aback by an incident that had occurred shortly after “recovering”
from the February incident. Initially, Anna was excited to learn about a new customer
guarantee policy that Alfred Angelo was offering; however, was greatly disappointed
after finding out that the guarantee’s legal jargon was very limited and indemnified only
highly specific situations. It was not the “grand guarantee” that Alfred Angelo’s sales
representatives had verbally promised it would be. The misunderstanding led to
another costly situation for Anna, similar to that February incident. As Anna recalled,
I ordered five dresses that arrived in the wrong color. The agreement stated
that they would replace the dresses. The agreement did not state that I would
have to pay the replacement costs. They [Alfred Angelo] did not cancel the
order. I had to pay to correct their mistake… not only to return the five
dresses back to Alfred Angelo but also to pay the shipping fees to expedite

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 the correct shipment. As a long-time retailer, I thought we would have been
able to work it out, but it just didn’t happen.”
Minimum Order Quantities – Transactional Supplier Relationship
Late shipping and ordering mistakes were not the only issues the Olesons had with
their suppliers. Royal Beginnings relied on approximately 15 suppliers for their
assorted products. Ten of those suppliers comprised 80 percent of their orders. Anna
tried to choose the best designers to offer stylish selections at affordable prices for her
customers (Exhibit 3).
Each company stocked products in an assortment of colors, styles, at varying
prices, and in an array of sizes. The majority of the companies were also very good at
adhering to their sizing charts. If, for example, the measurements of a dress were not
in accordance with the sizing chart, most suppliers would take the dress back and
provide another properly sized dress at no additional cost.
Historically, the bridal gown designers that met Anna’s exacting standards were
Alfred Angelo, Mori Lee, Mon Cheri and Maggie Sottero. She liked the Maggie Sottero
and Mon Cheri lines because they were highly sought after by brides and she had an
exclusive territory (i.e., the firm would not sell to another retailer within a 90-mile
radius). On the con side, though, both suppliers required a minimum order of 12
gowns. For bridesmaid dresses, the most popular suppliers included those same
designers, as well as Alexia, Bill Levkoff, and Avalon. The bridesmaid dress suppliers
required an order minimum of 18 dresses. Anna used Ursula and Adrianna Papell
specifically for their large selection of dresses and separates4 for the mother of the bride
and mother of the groom.
Royal Beginnings primarily used two tuxedo suppliers to adorn male customers.
Jim’s Formal and Nedrebos provided the newest styles of rental tuxedos for men. A
special customer incentive offered the groom’s tuxedo without charge if accompanied
by five tuxedo rentals. The tuxedo business was an easy – and profitable – one for
Anna to incorporate into the store, since it did not require Royal Beginnings to carry
any inventory of either tuxedos or men’s shoes. Instead, tuxedos were specially
ordered for the specific occasion (wedding or prom).
The Olesons believed that their business relationships with all their suppliers
should be collaborative. They believed that Jim’s Formal was the supplier that best-
reflected Royal Beginnings’ business practices. “It began the very first day the shop
opened,” Anna recalled. “A representative from Jim’s was there to show us how to
measure gentlemen for tuxedos.” From the Olesons’ perspective, the 23-year
relationship with Jim’s produced a high degree of professionalism and reliable
customer service that had been advantageous to both parties – Royal Beginnings
provided Jim’s with tuxedo orders and Jim’s provided Royal Beginnings with stylish
rental tuxedos, on-time delivery, and competitive pricing. Consequently, it wasn’t
surprising that Royal Beginnings had received the time-honored Elite Retailer of the
Year award from Jim’s multiple times in the past. Additionally, they had a prearranged
early shipping status for tuxedos, which was especially important during the busy prom
and wedding seasons.
Anna viewed 90 percent of her suppliers as transactional partners (money for
products)5, rather than collaborative partners. “Sometimes they seem to be out to feather
their own nests,” Anna declared. This was because it had become an industry standard
to require “block purchases” from all buyers annually. This required buyers –
regardless of the size of their business or customers served – to purchase specified
quantities of their garments. For example, Royal Beginnings was required to buy a

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 minimum of 12 wedding dresses and 18-24 prom dresses – from each of their suppliers.
While Anna felt these requirements might be inconsequential to shops in bigger
municipalities with larger markets (e.g., New York, Detroit, or Chicago), for smaller,
regional retailers, mandatory minimum purchase order quantities could be suffocating.
Additionally, the wedding gown suppliers, mandated that eight of the 12 wedding
dresses ordered had to be “higher-priced” gowns, while the remaining four could be
“lower-priced” gowns. From Anna’s perspective,
Smaller shops should be able to buy a smaller quantity altogether, or at a
minimum, they should reverse the order requirements and let small shops
purchase eight ‘lower-priced’ gowns and four ‘higher-priced’ bridal gowns.
They say that we can’t sell effectively without having a good selection of their
products. I know what I can sell and that doesn’t always coincide with their
minimums. The quantities should be determined by community size and
economic conditions. These larger quantities and order requirements are
running us into the ground financially! We only have approximately 650
formal attire purchase orders annually (350 dresses and 300 tuxedos). Why
should the suppliers treat a small shop exactly the same as a large shop? We
turn6 some dresses three to four times a year while larger, metropolitan shops
can turn them 12 times. They [the suppliers] are financing their ‘next season’
start-ups7 on the backs of the small retailers!
The minimum quantities became a larger financial issue when the supplier
discontinued a dress style within six months of ordering it at market. Suppliers offered
a particular dress style as long as it was producing the targeted level of revenue for
them. However, it was frustrating to the retailer when the supplier discontinued a style
that sold well in their region.8 Anna stated,
A ‘bread and butter’ dress for our shop may be discontinued because it is not
popular nationwide. These leaves us with a lot of extra dresses. At any given
point in time, we probably have about 150 wedding gown samples in the store
along with another 300 bridesmaid dresses and about 150 mother’s dresses,
from about ten manufacturers’ lines and ranging in price from $110 to $1,500.
Our pricing is different from the large, nationwide stores due to styling and
our location. Nationwide, store dress prices averaged from $200-$10,000.
Our customers just don’t have that kind of money to spend on wedding attire,
so we just don’t need that many high-priced dresses. Our average cost of a
wedding gown at Royal Beginnings is $800, for bridesmaid dresses it is about
$100-$250, and for mother’s dresses it’s about $150.
At the 2012 show, however, Anna recalled having spoken to representatives from
three other firms – Clarisse, DaVinci, and Milano Formals – and resolved that she’d
have to keep an eye out for them this year. Clarisse and Milano offered high fashion
bridesmaid and prom dress styles at a price that her customers could afford. Likewise,
DaVinci offered not only the stylish bridesmaid and prom dresses, but also bridal
gowns at reasonable prices. And the best thing she remembered from her
conversations with them was that none of them required minimum quantities! She was
also impressed that each of these suppliers had followed up with her four times over
the last year, which seemed to signal their interest in having her as a customer. So,
although she hadn’t ordered anything from them yet, maybe it would make sense to
talk with them again to find out more about their styles, quality, service, and delivery
offerings.

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 THE WEDDING MARKET AND SHOPPERS’ BEHAVIOR
Within the U.S. approximately 2.1 million marriages occurred each year, representing a
proportion of 6.8 marriages per 1,000 people.9 It also represented a sharp decline in
the rate of marriages over the past few decades. Previous measured rates were
9.8/1,000 in 1990 and 8.3/1,000 in 2000. The decline in marriage rates was attributed
to the increase in cohabitation rates.10
Conversely, the mean age of both brides and grooms in the U.S. had trended
steadily upward. In 2013, the mean ages were estimated at 26 years for women and
27.6 years for men. Statistics also indicated that nearly four million people would turn
27 years old before the year 2030, suggesting that there would be “an ample supply of
brides and grooms for the next 20 to 25 years.”11 This applied to those people born
between 1979 and 1998.12
The average cost of a wedding was estimated at $28,000,13 with most couples
spending somewhere between $20,000 and $33,000 on various wedding expenses (see
Exhibit 4). This represented more than $100 billion in wedding-related business
annually.14
As the children of Baby Boomer parents, the “Millennials” (also termed the ‘Net
Generation, Echo Boomers, or Generation Y) had been described as:
 Being engaged, on average, for 16 months.15
 Being “… older, more established and savvy shoppers who have created
individual identities and are now merging households… [they] are
members of the most brandable generation ever (they want good stuff).”16
 Rejecting “items that they feel everybody else has and, raised in an age of
Internet shopping, they are not averse to waiting if it means getting exactly
what they want.”17
 Seeking unique products and experiences, so customizing products to
their individual lifestyles or desiring to see a “broad selection before
they’re willing to plunk their money down.”18

BUSINESS PRACTICES AT ROYAL BEGINNINGS

Royal Beginnings was a full-service shop, designed to help customers create their
customized look for their special occasion. Royal Beginnings provided bridal and
formalwear services. Specifically, they catered to a clientele in search of bridal gowns,
bridesmaid dresses, mother of the bride dresses, tuxedos, prom dresses, invitations,
and accessories.
Sales revenues were attributed to: bridal gowns (25%), bridesmaid dresses (25%),
prom dresses (20%), tuxedos (17%), and mother of the bride dresses (10%).
Invitations and accessories (shoes, headpieces and undergarments) made up the
remaining three percent of sales (See Exhibit 5). Demographically, about 20 percent
of the business came from the area’s university and college students. Nearly 80 percent
of the business was directly associated with clients located within a 90-mile radius of
the shop’s location. Customers were willing to drive long distances to Royal
Beginnings, as most in Michigan’s Upper Peninsula lived in communities with
populations of 700 to 7,600 and did not have this type of store in their small town.19
Anna’s 23 years of experience led her to formulate a consumer model that was
based on three factors. In no particular order, her customers appreciated: (1) style, (2)
price, and (3) service. She identified this as her core business model and refused to

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 compromise any aspect of it, crediting it for the shop’s longevity and awards. To wit,
Royal Beginnings had been voted the area’s best bridal shop six times over the years.
It was vital to the Olesons that they maintained excellent service. Anna and Jack
used a very specific set of standards to prepare new employees. Although it was
sometimes difficult to convince a new salesperson that each person who walked in the
store wanted to be viewed as special, training them how to graciously approach each
customer was imperative. Other principles incorporated into the culture of Royal
Beginnings were:
A consultant can never assume that an older shopper is the mother of the bride
(or groom); she may be the bride.
 A prom dress shopper will spend as much money on a prom dress as a
bride will spend on a wedding gown.
 Wedding shoppers were hesitant to buy a gown off the rack because they
perceived it as being “shop worn.” Instead, they wanted to try on the
dress in the store and (if they liked it), place a special order from the
manufacturer. (See Exhibit 5 for the percent of sales that were generated
from in-stock merchandise versus special orders by dress type.)
 Requesting the right quantity of the right merchandise in the right place
at the right time at market was an essential skill that everyone at Royal
Beginnings must possess. In order to accommodate this, consultants
were expected to have a good understanding of what customers sought in
bridal and formalwear, and anticipate what they would want to buy.
A bride’s first visit to the store typically included a wedding and formal consultation
with the customer. Anna acknowledged that every customer was different. “Some
ladies make their decision almost instantaneously – within 30 minutes – while others
take up to 12 hours (four hours for each of three visits when they bring in their family
and friends). Some customers use Royal Beginnings as their closet. They spend two
to three hours trying on $8,000-$10,000 worth of gowns and then go to Joe Schmo’s
Bargain Bridal to buy their gown.”
Anna, with input from her employees, felt she chose the best looks from the
country’s leading designers. These choices were based on research, current style
standards and instinct. Everyone who worked at Royal Beginnings had spent years
scrutinizing the whims of style. From magazines to manufacturers’ websites to
designer runway shows, Anna insisted on keeping her finger on the pulse of fashion.
This knowledge was invaluable in the wedding business. It created the ability to
compromise price for fashion. “Many times the customers come in with Cadillac tastes
and a Yugo budget. Our consultants use the customer’s ideas to achieve the look they
desire. The wedding will still look fashionably similar but with a budget they can
afford.”
Another key service element in Royal Beginnings’ success was the shop’s expert
seamstress. Anna viewed each customer as special and physically unique, and she
worked hard to engrain that attitude in each consultant and excel with their alterations
service. As she recalled,
Many of the girls will come into the shop with a $50 dress that they bought
on the Internet and end up spending $150 in alterations to get the dress look
like what they really want. We truly can make a silk purse out of a pig’s ear!
Ensuring that this special dress fits perfectly is important to every customer.

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 With our excellent seamstress (who works in the store year-round), I definitely
consider us to be a full-service bridal shop.
In an effort to keep pricing competitive, Anna and Jack recently developed a
Consultation Agreement for customers (see Exhibit 6). The agreement was presented
to brides on their first visit. The $25 fee allowed the bride and her party to meet with
a trained consultant for two hours to determine style, color, budget, and other features
appropriate for the bridal party’s personality. The brides were very receptive to the
agreement. According to Anna, “The mother of the bride saw the real value [in the
consultation] and generally offered to pay the fee.”
This $25 fee could be applied to the bride’s and bridesmaids’ dresses if a dress
order was submitted through Royal Beginnings. Otherwise the $25 fee was simply
absorbed into the business. Anna believed the fee was appropriate in the small,
economically challenged town. Jack had concurred, “Having the fee is a deterrent to
helping us not be viewed as just a ‘try-on shop.’” The Olesons considered the
agreement a success. To date, 50% of the brides who signed the agreement ordered
their dress from Royal Beginnings.
In addition to implementing the Consultation Agreement, Royal Beginnings had
recently launched an appointment system. While they still welcomed walk-ins, the
appointment system ensured that all customers would receive the necessary assistance
they were seeking. For example, if a customer wanted to be fitted for a dress, it ensured
that the seamstress had sufficient time available in her schedule to work with her.
Brides were given a discount on their wedding invitations if they purchased their
wedding gown from Royal Beginnings; however, Anna viewed invitations as a declining
part of the business. This was a trend that she and her husband had seen with the
photography part of the business as well. “Wedding photography used to be a big part
of our business, but now everyone has a friend who can take pictures of their special
day. The photography computer software programs are easy to use,” she shared. “We
still sell invitations, but more brides seem to be making them on their own these days.”
Keeping pace with the changes in technology helped keep Royal Beginnings at the
forefront of the region’s formal attire retailers as well. Initially, only television
commercials were used to advertise to the potential customers in the area. However,
development of a Facebook page and then a business website had increased the
business’ exposure with tech-savvy shoppers. Royal Beginnings’ website was
constructed purely for the customer to view the shop’s selection of products and
services. This option streamlined the overall experience as customers could have
knowledge of products prior to their visit to the shop. Anna recalled, “About two in
five customers, or 40 percent, said they visited our website before coming into the
shop.”
While the Olesons used a computer in the store and valued technology, they still
did many things the old-fashioned way. Anna, in particular, believed that ordering and
inventory tracking was best done with a manual system, and she still called in orders
from a hard-copy purchase order book. In addition, a card and file system was in place
to manage clients’ orders and activity (e.g., day of visit(s), what they did during the visit,
orders, etc.). While much of the supplier-customer communication was done over the
telephone or through e-mail, the Olesons preferred that vendors visit their shop in-
person. As Anna stated, “We prefer the quarterly face-to-face visits we receive from
our main accessories supplier, J.L. Johnson, and tuxedo supplier, Jim’s Formal. As a
result of their visits, they better understand our shop’s needs. They also provide
valuable feedback to us… for example, detailed sales spreadsheets during their visits.”

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 Anna had been a member of the National Bridal Service (NBS)20 for 17 years. This
meant that in addition to taking wedding consultant classes, she could obtain specific
dresses that her customers requested even if she did not carry the line. However, this
service was provided at an additional cost to Royal Beginnings and frequently turned
out to be an extra service for the customer, but was not a profitable sale for Royal
Beginnings. Anna paid $1,200 for the NBS annual membership, $80 to ship each dress,
and an additional 20-30% markup from the wholesale dress price. She used the service
to assist approximately two to three brides annually. Before joining NBS, she had
explored the idea of creating some type of consortium, where small bridal boutiques,
such as hers, could buy dresses from other bridal shops in the U.S., thereby avoiding
buying the 12 dress minimum quantity from each supplier. However, she discovered
that was considered trans-shipping,21 which was viewed as unethical in the bridal
industry – a practice that could result in a shop’s buying privileges being revoked and
future orders not being honored by the supplier.
Royal Beginnings engaged in annual community and sales events, as well as
philanthropy. With local pageants, for example, Anna sponsored the queen/winner’s
participation, paying her pageant entry fee. She also offered discounts to pageant
contestants on their dresses. Annually, she hosted multiple in-store sales events to
decrease her inventory using the local radio station to promote the events.
Additionally, she donated dozens of dresses to missionaries in Mexico. To date, Anna
knew that her donated dresses had been used for at least 20 weddings in small Mexican
villages.

THE COMPETITION
Royal Beginnings’ nearest brick and mortar competitor was 90 miles away, although
that hadn’t always been true. Several other bridal shops had opened and closed over
the past two decades: three competitors in the same immediate area failed to survive,
in addition to three more within 30 miles. Anna credited the competitive edge to the
Royal Beginnings’ customer service model that resulted in repeat customers from
several generations (a.k.a., the cross-generational effect).
“We have done quite well with respect to other brick and mortar competitors over
the past 23 years,” she proudly asserted. “Our service is fair, customized, and we
provide excellent alterations. It is the personal service involved in developing the
relationship that eventually results in a sale. Now the daughters of former customers
are buying their wedding dresses from us.”
The competition that concerned the Olesons most was online shopping. The rapid
growth of online purchasing had them looking for ways to capitalize. They’d spoken
with an Internet service provider about boosting the site’s search engine rankings, but
it proved to be too expensive for their shop size. Then there were also the
consequences of blind ordering. Too frequently, Internet shopping had resulted in the
customer receiving the wrong color of dress, inferior material quality of the dress, or
the wrong dress altogether.
“Generation Y brides are drawn to and accustomed to shopping on the Internet,”
Anna explained. “We had about 20 percent of our potential bridal customers purchase
through the Internet instead of through our shop. But many of these customers have
had negative experiences. We hear about these experiences when the bride comes in
to purchase a dress from our shop or wants us to fix the inferior dress she purchased
through an online retailer. Overall there seems to be a high dissatisfaction with the
bridal online experience. Customers are learning that it’s not a smart way to go.”

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 Royal Beginnings suppliers, in particular, Mon Cheri, were well aware of the
fraudulent Internet e-commerce issues. According to Steve Lang, CEO of Mon Cheri
Bridals and president of American Bridal and Prom Industry Association (ABPIA),
“These sites are set up to confuse and cheat consumers. In order to lure brides, they
pay to get prime ad placement on popular search engines, and then use keyword
optimization so they appear every time someone searches for, say, ‘cheap Allure bridal
gowns.’”22
Lang stated that the majority of the factories producing the fake gowns were
located in China. The number of websites dramatically increased from 20 to over 300
in a short period of time. They became quite masterful at including the “correct
information” by showing stolen photos of designer dresses, as well as using correct
brand names and style numbers to convince potential buyers that they were getting a
real designer dress for a fraction of the retail price.
Several of Royal Beginnings’ designers, including Alfred Angelo and Maggie
Sottero, along with Mon Cheri, had responded to the counterfeit issue by creating
“buyer beware” education warnings on their websites. The suppliers explicitly stated
in their educational warnings that the only way to ensure that the dresses were authentic
was if they purchased through an authorized retailer, such as Royal Beginnings. They
did not sell to the customer directly. While purchasing bridal and formal products sold
through an unauthorized retail location online was cheaper, it often resulted in
customers feeling greatly disappointed and later regretting their “bargain” find.
An additional positive step in response to the counterfeit online issue was the
creation of the American Bridal and Prom Industry Association (ABPIA) in 2013. The
not-for-profit organization was created as a way to fight the counterfeit online e-
commerce battle. Since its creation, it had grown to over 400 members that included
designers, manufacturers, retailers and others in the formalwear industry. To date, the
ABPIA had filed lawsuits against 1,500 different websites that were suspected of
counterfeit practices. Several of the lawsuits had already been resolved, resulting in
websites being shut down and assets totaling $2.2 million in Paypal accounts being
seized. In fact, according to the ABPIA,
These decisions are a landmark for our organization. But it’s only the first
step in an aggressive path we are taking to cut off the flow of counterfeit
formalwear products into this country, because those fake goods harm both
consumers and the legitimate designers and manufacturers who invest
millions each year in offering their creative work to those consumers. With
these recent victories, the ABPIA will be intensifying its efforts in the coming
months to battle counterfeits, educate consumers about the dangers of
counterfeit products and work with the state and federal agencies and
legislators to both enforce and improve the laws protecting customers and
designers.23

GOING TO THE MARKET

The National Bridal Market was an annual trade show that offered retail buyers the
opportunity to view merchandise from a multitude of suppliers and to meet with
company representatives. There were approximately 50 bridal and bridesmaid dress
companies represented, 35 prom companies and ten tuxedo companies. Royal
Beginnings relied on approximately 11 of the 95 exhibitors at the show.

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 The National Bridal Market was on the 8th floor of the Chicago Merchandise Mart
building. The scene inside always reminded Anna of a typical trade show, with the
floor filled with rows of booths where sales reps promoted their offerings and were
always poised to answer questions and take orders from retail buyers. The
manufacturers’ merchandise was available for buyers’ perusal and hands-on inspection
at each supplier’s booth, which was extremely important to Anna. She judged the
material quality of every design by running it through her hands to determine if she
approved of the material. Assuming it passed her quality test, she then considered the
price, style, and the supplier’s service and minimum quantity standards.
Throughout the two-day event, designers, manufacturers and suppliers showcased
their offerings in a series of flashy, well-attended fashion shows - see Exhibit 7. These
shows provided buyers with an opportunity to see how various outfits hung and moved
on real people. They also informed buyers about style trends in wedding gowns (e.g.,
sheer overlays, peplum,24 lace, beading/sequins, color and unique neckline styles). The
glamour of these shows was another sales pitch in itself. Many of the suppliers also
sold bridal veils, shoes, jewelry, and other accessories, due to their high mark-ups.

THE DECISION
Six hours later, as Jack slid into a parking spot in the North Wacker Garage, just a few
blocks away from “the Mart,” Anna ate the last few bites of her pasty and tried to
organize her thoughts. The National Bridal Market was always a great opportunity to
find out what styles bridal and formalwear customers would be looking for in the
upcoming year. However, they could not afford to be distracted this year by the show’s
glitz and excitement. Instead, they needed to have some heart-to-heart talks with their
current suppliers – and, depending on how that went, search out new suppliers that
would assist them in delivering on-time customer service without decimating their
personal profits. Suppliers, Anna reasoned, should be partners through thick and
thin… in both good and bad times. But that certainly hadn’t been the case over the
past year.
With many thoughts swirling in Anna’s mind, they stepped out of the car, exited
the parking garage and began their walk up Franklin Street. How could they avoid
these types of situations in the future? Anna knew that Royal Beginnings was a smaller
shop, but she desperately wanted to think that suppliers would be willing to work with
her – regardless of her shop’s size. She recalled her prior experience as a direct sales
representative for a large organization in which incentives were offered for level of
business and customers’ years of loyalty. After 23 years, would Alfred Angelo and her
other current suppliers be open to negotiating with her on the minimum quantities and
improving customer service?
Strolling along the bridge over the Chicago River, Anna reasoned that suppliers
should understand that the order volume should be customized to the economy of the
retailer’s community… shouldn’t they? Why should Royal Beginnings be bound to
comply with mandated order quantities and pricing structures? The sheer nature and
volume of business varied drastically between Royal Beginnings – a store located in a
relatively rural area in northern Michigan – and a store in downtown Chicago
surrounded by millions of people!
And, what about the failed customer guarantee from Alfred Angelo? While she
liked the idea, the agreement implementation obviously didn’t match what had been
communicated. Would the suppliers be open to her input on these types of
agreements? Anna hoped that the conversations she planned to have with her existing

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 suppliers would help determine if she should retain them as partners for the upcoming
year. While she believed she had a good relationship with each of her suppliers, for
the sake of her business, she knew she needed to work with only the best suppliers…
and “best” meant that they needed to be sensitive to the needs of a smaller shop.
Although she preferred to not change suppliers, Anna wondered if Clarisse, DaVinci
and Milano Formals’ “no minimum quantities” policies might be a better fit with her
store. In any case, she needed to get some concessions from her existing suppliers to
continue doing business with them.
Anna and Jack entered “the Mart.” As they rode the elevator to the 8th floor,
Anna’s thoughts were interrupted by Jack’s question, “Do you have your show map
(see Exhibit 8) ready to go? Keep in mind that our decisions this year need to be
especially focused on our prospective customers’ needs… we can’t be swayed by
market trends.”
They stepped off the elevator. The entrance to the National Bridal Market (see
Exhibit 9) loomed directly in front of them… wow! All the new gowns looked as
impressive as ever! Just beyond the entrance, Anna spotted the Alfred Angelo
showroom/booth and inhaled deeply.
“Well, Jack, we’ve got a lot of factors to consider. There’s that saying in the
industry… ‘It’s not about brand – it’s about style.’ But I’m beginning to think it’s not
even about style – it’s about selecting suppliers that have the capabilities to service our
needs.”

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 Exhibit 1: Royal Beginnings Store Layout

Alterations Area
Additional Wedding
Dresses and Shoe
Inventory

Fitting Rooms

Consultation/Sitting Area

Check out
Ordering/
Wedding Bridesmaid
Dresses Dresses
Jewelry and Accessories

Jewelry and Accessories

Short
Dresses
Special
Occasion
Dresses
Special
Occasion
Dresses
Tuxedos

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 Exhibit 2: Royal Beginnings Store

Source: Company Photos, used with permission.

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 Exhibit 3: Royal Beginnings (RB) Supplier Information – Current and Proposed*
Number
Type of Price (P), Minimum Order
Current/Proposed of Years Number of
Formal Attire Quantities (MOQ), Service (SVC)
Supplier (C/P) as RB Locations/Retailers
RB Orders** and Style (S)***
supplier
Adrianna Papell 10 years MOB, MOG, P: L-H MOQ: SVC:M S: M ~1,250 Retailers in U.S.
(C) and SO L and worldwide
Est. 1979
Alexia Designs (C) 8 years BM, MOB, P: L-M MOQ: SVC:M S: M ~540 Retailers in the
Est. 2004 MOG, FG, PD, H U.S. and Canada
and SO
Alfred Angelo (C) 23 years BG, BM, MOB, P: L-H MOQ: SVC: L S: H ~2,500 Retailers
Est. 1935 PD, FG H worldwide; 62 Alfred
Angelo Bridal Signature
Stores in U.S.
Bill Levkoff (C) 18 years BM P :L-M MOQ: SVC:M S:M >200 Retailers in U.S.
Est. 1950’s H
J.L. Johnsons 23 years Headpieces, P: L-M MOQ: SVC: S: H >200 Retailers in U.S.
Bridal (C) Jewelry, and L H
Est. 1983 accessories
Maggie Sottero (C) 5 years BG, BM and P: M-H MOQ: SVC:M S: H ~774 Retailers in U.S.
Est. 1997 PD H
Mon Cheri (C) 8 years BG, MOB, P:M-H MOQ: SVC:M S: H >300 Retailers in U.S.
Est. 1991 MOG, SO, FG H
Mori Lee (C) 10 years BG, BM, MOB, P: M-H MOQ: SVC:M S: H 5,000 Retailers in the
Est. 1956 SO H U.S. and worldwide
Jim’s Formal (C) 23 years Tuxedos P: L-M MOQ: SVC:H S:H 5,000 Retailers in the
Est. 1922 L U.S.
Nedrebos (C) 23 years Tuxedos P: L-H MOQ: SVC:M S: H 400 Retailers in U.S.
Est. 1945 L
Ursula of 8 years MOB and P: M-H MOQ: SVC:M S: M ~5000 Retailers in the
Switzerland (C) MOG M U.S., Mexico, Canada,
Est. 1965 England and Australia
Clarisse (P) BM and PD P: L-M MOQ: SVC: S:H ~350-400 Retailers in
Est. 2013 L U.S.
DaVinci (P) BG, BM, and P:L-M MOQ: SVC: S:H >500 Retailers in U.S.
PD L
Milano Formals BG, BM, and P: L-M MOQ: SVC: S:H >200 Retailers
(P) PD L
Est. 1910
*All Suppliers Attend National Bridal Market – Chicago, IL
**BG: Bridal Gowns, BM: Bridesmaids Dresses; MOB/MOG: Mother of the Bride/Mother of the Groom Dresses;
PD: Prom Dresses; FG: Flower Girl Dresses; SO: Special Occasion Dresses (e.g., Party, Prom, Quinceanera
and Homecoming dresses, Short dress suits).
***Pricing: Low: $; Medium: $$; High: $$$; Minimum Order Quantity (MOQ): L= Low or No Minimum Order
Quantity; M= Medium: Requires an order of 6-8 dresses in a variety of bridesmaid, prom and bridal dress
combinations; H = High: Requires an minimum order quantity of 12 bridesmaid/prom dresses and 12 bridal
dresses regardless of the bridal shop’s geographic location. Quality of Service (SVC): L= Low (Does not respond
in timely manner to customer’s requests/concerns; M= Medium (Responds to customer requests/concerns,; calls
once/quarter. H = High (Very timely in responding to customer requests/concerns; calls more than once/quarter.
Style: L: Low Demand; M: Medium Demand; H: High Demand.
Source: Created by the authors from information provided by Royal Beginnings

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 Exhibit 4: Wedding Costs Analysis

AVERAGE WEDDING COSTS

ATTIRE & ACCESSORIES 1629
BEAUTY & SPA 129
ENTERTAINMENT 1889
FLOWERS & DECORATIONS 1563
GIFTS & FAVORS 702
INVITATIONS 789
JEWELRY 4133
PHOTOGRAPHY & VIDEO 2835
PLANNER/CONSULTANT 827
VENUE, CATERING &… 11944

0 4000 8000 12000

Source: Adapted from

http://www.costofwedding.com/index.cfm/action/search.weddingcost/zipcode/00000/

Exhibit 5: Percent of Sales and Stock vs. Special Order at Royal Beginnings
Customer Customer Purchases
Purchases from through Royal
Percent Royal Beginnings Beginnings Special
Sale Type of Sales Store Stock Order
Bridal 25% 30% 70%
Bridesmaid 25% 0% 100%
Prom/Special Occasion 20% 60% 40%
Mother-of-the-Bride 10% 75% 25%
Tuxedos 17% 0% 100%
Accessories (headpieces, 3% 70% 30%
jewelry, shoes, etc.)
Source: Created by the authors from information provided by Royal Beginnings

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 Exhibit 6: Royal Beginnings Consultation Agreement

I hereby agree to pay $25 in consultation fees for the following Royal Beginnings
services:
 Up to 2 hours of professional in-person consultation time.
 Discussion of theme, color, style, and complete wedding design.
 Provide professional guidance and suggestions in making the final dress and
accessory selections.
The $25 fee will be applied towards the purchase of a wedding dress if ordered through
Royal Beginnings. Otherwise, the $25 fee will be retained by Royal Beginnings for the
services provided.

Accepted:

Bride’s Signature: __________________________________________

Date: __________________________________________

Exhibit 7: National Bridal Market: Mon Cheri Fashion Show – Chicago, IL

Source: Anna Oleson’s personal photographs, used with permission

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 Exhibit 8: Merchandise Mart 8th Floor - National Bridal Market – Chicago

Source: Buyer National Bridal Market Registration Packet Materials

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 Exhibit 9: National Bridal Market Entrance

Source: Anna Oleson’s personal photographs, used with permission

NOTES
1
As cited in Miller, R.K., & Washington, K. (2013). Chapter 20: Bridal & wedding
market. In Retail Business Market Research Handbook (pp. 94-97). Richard K. Miller
& Associates.
2 While the company name has been disguised, all descriptions about the small business,
its location, and characters mentioned in the case are authentic.
3 A pastie (or “pasty”) is a crimped, baked pastry, typically filled with beef, diced
potatoes, rutabaga, and onions, and seasoned with salt and pepper. Pasties are popular
in Michigan’s Upper Peninsula, particularly among those of Finnish descent.
4 Separates are items that are sold individually. Typically, customers can “mix and
match” separates, thereby creating a look, customized for their style and body shape.
5 Royal Beginnings uses a firm fixed price basic contract with its suppliers. This means
that the pricing included on the order placed at market does not change even if other
market or economic conditions change.
6 Turns: The number of times that a shop orders a dress from the floor sample.

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 7 Start-ups: Costs associated with designing and marketing new dresses (e.g., designer
and marketing costs).
8 The average time for a dress style to be offered by a supplier was two years. Royal

Beginnings, however, might keep a dress displayed on the floor for sale for three to
four years. Bridesmaid dresses were kept for three years; bridal gowns, prom dresses
and mother of the bride dresses were kept for four years.
9 Miller and Washington (2013), op cit.
10 Copen, C., Daniels, K. & Mosher, W. (2013). First premarital cohabitation in the

United States: 2006–2010 National Survey of Family Growth. National Health

Statistics Reports, 64. Retrieved from
http://www.cdc.gov/nchs/data/nhsr/nhsr064.pdf#x2013;2010%20National%20Surv
ey%20of%20Family%20Growth%20[PDF%20-%20227%20KB]%3C/a%3E.
11 Brown, R. (2007). The matrimony market. Shopping Centers Today, 28(2), 23-24.
12 Graff, M. (2010). Here comes the millennial bride. National Jeweler, 104(9), 8-16.
13 Condé Nast Bridal Media, as cited in Miller & Washington, 2013. This does not

include either an engagement ring or honeymoon. The data collected by Condé Nast
reflects couples who are more likely to have had more expensive weddings, and does
not include couples having a civil ceremony or no-frills reception.
14 Brown, 2007, op. cit.
15 Miller & Washington (2013), op. cit.
16 Moran, M. (2001). Competing for today’s bride. Gourmet Retailer, 22(7). Retrieved

from http://web.ebscohost.com.ezproxy.gvsu.edu/ehost/detail?vid=3&sid=ee13f46c-
e66e-
41c9b03c8e3336692e09%40sessionmgr198&hid=125&bdata=JnNpdGU9ZWhvc3Qtb
Gl2ZSZzY29wZT1zaXRl#db=bth&AN=4829301, para. 1 and 3.
17 Graff, 2010, op. cit., para. 2.
18 Ibid. para. 11.
19 The total population in the Western Upper Peninsula is estimated at 174,771. Source:

https://datausa.io/profile/geo/western-upper-peninsula-puma-mi/
20 National Bridal Service started in 1951. It aims to provide continuous support their

members, which enables them to continuously improve their business, and their service
to all customers and especially their brides. Source: http://nationalbridal.com/htm
21 Transhipping occurs when one bridal store (Bridal Store A) who does not carry a

particular supplier line, purchases a dress from another bridal store (Bridal Store B)
who carries the requested line. The bridal industry views this as high risk and
unethical. Bridal Store A does not have the backing of the manufacturer to correct any
problems/issues. They have to rely on Bridal Store B to resolve the issues. Also,
Bridal Store A is avoiding the 12 dress investment requirement. They are benefitting
by offering a dress style to the customer at manufacturer’s cost plus standard shipping
costs from Bridal Store B to Bridal Store A.
22 As cited in Tudino, C. (n.d.). The real cost of a counterfeit wedding dress: Believe it

or not, there’s a whole black market behind these white dresses. Read this before you
go shopping so you don’t get duped. Retrieved from
https://www.theknot.com/content/buyer-beware-the-real-cost-of-a-counterfeit-
wedding-dresses, para 2.
23 Lang as cited in American Bridal and Prom Industry Association (ABPIA). (2015).

ABPIA wins $2.2 million against bridal and prom counterfeiters. Retrieved from
http://www.abpia.org/author/admin/ , para. 4.
24 Peplum is an angular ruffle that juts out from the dress, creating a unique and modern

look.

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