Since the Civil War, S/M/L sizing has been the pre-eminent sizing system used for men’s shirts. Back then, it was used to effectively get soldiers into uniforms. A hundred and fifty years later, retail is still using the same system. Stantt has questioned the idea that you can only pick between a few generic sizes. Currently, only 15% of men get a great fit from off-the-rack casual shirts. In contrast, Stantt has created a sizing system that gives 95% of men a great fit. The operating and business model is built around a focus on the consumer, with an efficient supply chain to support it. Stantt differentiates itself by offering quality, value, speed, service, style and convenience to its clients.
Using millions of data points and measurements from 3D body scans of over 2,000 men, Stantt build a new approach to sizing. Using this 3D modelling software, Stantt digitally tested sizes on thousands of guys and came up with a new sizing system, but with 75 different sizes.
So how does this work? They are not an off the rack store, but they’re also not your average custom shirt company, which might require 10 to 15 measurements from every client. Using nothing more than a tape measure, Stantt allows a client to enter 3 simple measurements: chest, waist, and sleeve size (with sizing demonstration videos on the website) and type these measurements into the algorithm provided on their website. The website then tells the consumer what his size is. What if you don’t feel like you can accurately measure yourself? You can head into one of Stantt’s three retail locations in New York or New Jersey where you can book a fitting or walk right in. There, in addition to being measured by a professional, you can try on the 75 different sizes to ensure that you have found the right fit.
Once a shopper knows his size, he can choose his preferred style (casual, dress, or premium dress) and then he can pick from one of Stantt’s 40 different patterns. If the shirt, which costs $88 for casual and $98 for dress, is in inventory, it will ship in a day. If not, it will ship within a week.
Here is where the business model and operating model effectively integrate. While an average custom-fit shirt costs around $200, and can take 3-4 weeks to ship on average, Stantt shirts ship in 7.5 days on average, at a significantly cheaper price, but with the same high quality material, and in a much more convenient manner. If a client decides to measure himself and order off the website, and the shirt he receives does not quite fit right, a form is provided that allows him to return the shirt, change the size, and receive free shipping both ways. Stantt’s return rate is under 5%, versus the industry average of 30-40%.
All material is sourced directly from Europe, and it is sold directly to consumers, avoiding the over 100% markup you will find at specialty retailers. By cutting out the middleman, Stantt is able to provide incredible quality at a fair price. Orders are routed through Stantt, which compiles them and then relays them directly to their factory in Central America. The one variable with this operating model is that Stantt has to be somewhat accurate in predicting demand month to month so as to order enough raw material from Europe.
Stantt currently has 60% of its sales from retail, and 40% of its sales from online. The current business model acquires customers through the small footprint, high traffic retail spaces, and retains clients through online repeat. The company currently has over 25% costumer repeat and their average customer has spent over $200.
Their robust supply chain allows them to reinforce this business model. With the new factory the company just built in Central America, the lead time on orders has gone from 6-8 weeks when the company first launched, to 7.5 days. This just-in-time ordering system and industry-leading lead time is accomplished through pre-existing orders and sizes, and with the benefits of economies of scale, which enables the factory to make multiple cuts of the same pattern, this lead time should continue to decrease as order volume increases. The current capacity of the factory allows them to scale to $10 million in annual revenue and capital has already been allocated to scale that capacity to $30 million by 2016. The defect rates firm wide remain below 1% and are expected to continue to decrease. Over 4,000 shirts have been made at the new factory with an average turnaround time of only 30 hours. The company’s current focus is ensuring that their supply chain can continue to ship custom made shirts in 7.5 days at larger volumes and with greater shirt offerings. The hyperlink to their marketing video is attached below:
Stantt just raised a bridge round and will begin raising a Series A in the beginning of 2016. Now that they have proof of concept and are projecting revenue next year of $3-5 million from around 10,000 costumers, they are currently in phase 2 of their strategy and are focusing on online/offline testing and expanding their shirt offerings. They have recently secured distribution at a major department store. While the current focus is men’s shirts, the team at Stantt believes that they can apply their fit technology and best-in-class supply chain to other lines of clothing going forward.
- Stantt 4Q Investor Update Presentation
- Hornbuckle, Matt. “Interview with Founder Matt Hornbuckle.” Telephone interview. 05 Dec. 2015.