The June issue of INC Magazine features an article about one of my favorite companies, Threadless.

Threadless is technically a T-shirt company, but in actuality it’s much more than that. It’s a community of artists, buyers, and evangelists all committed to and interacting about T-shirts. The description on their website states that Threadless is a community based tee shirt company with an ongoing, open-call for tee design submissions.

In the INC article, Jake Nickell, one of the founders of Threadless talks about the unique and innovative business model:

Threadless, he explained, ran design competitions on an online social network. Members of the network submitted their ideas for T-shirts — hundreds each week — and then voted on which ones they liked best. Hundreds of thousands of people were using the site as a kind of community center, where they blogged, chatted about designs, socialized with their fellow enthusiasts — and bought a ton of shirts at $15 each. Revenue was growing 500 percent a year, despite the fact that the company had never advertised, employed no professional designers, used no modeling agency or fashion photographers, had no sales force, and enjoyed no retail distribution. As result, costs were low, margins were above 30 percent, and — because community members told them precisely which shirts to make — every product eventually sold out. Nickell’s company had never produced a flop.

As the article goes on to explain, what Threadless is doing- giving the customer a critical role in “idea generation, marketing, sales forecasting” goes against the basics you’ve learned about how a business should be run.

And it’s working for them.

‘Chelle Parmele
Social Media Marketing Manager
Palo Alto Software