The Role of Innovation in Driving Growth for UK Manufacturers

Small and medium-sized enterprises (SMEs) make up a significant portion of the manufacturing sector in the UK, and they play a crucial role in driving economic growth and job creation. However, with increasing competition and rapidly evolving technologies, it’s becoming more important than ever for SME manufacturers to innovate in order to stay competitive and achieve long-term growth.

Innovation can take many forms, from developing new products and processes to improving existing ones. By embracing innovation, SME manufacturers can unlock new markets, enhance their production capabilities, and create more value for their customers. Here are some key ways in which innovation can help drive growth in SME manufacturers with two approaches discussed in each section:

Product Innovation

Product innovation is a key way for SME manufacturers to differentiate themselves from competitors and capture new markets. This involves developing new products or improving existing ones in response to changing customer needs, market trends, or technological advancements. Product innovation can take many forms, such as improving product performance, adding new features, or developing new product lines.

One approach to product innovation is to engage with customers to understand their needs and pain points. This can involve conducting market research, surveys, or focus groups to identify gaps in the market and areas where innovation is needed. SMEs can also leverage social media and online platforms to gather customer feedback and insights.

Another approach is to invest in research and development (R&D) to develop new technologies or materials that can be used to create innovative products. This can involve collaborating with universities, research institutions, or other companies to access new knowledge and expertise. SMEs can also explore government funding and grants to support their R&D efforts.

Process Innovation

Process innovation involves improving manufacturing processes to increase efficiency, reduce costs, and improve quality. This can be achieved through the adoption of new technologies, automation of processes, or the streamlining of workflows. By implementing process innovation, SMEs can become more agile and responsive to market demands and achieve higher levels of productivity and profitability. (For further reading on process innovation or improvement – click here)

One approach to process innovation is to leverage digital technologies such as artificial intelligence, machine learning, or the internet of things (IoT) to automate processes and enhance decision-making. This can involve implementing smart sensors and devices that can collect and analyse data in real-time, enabling SMEs to optimise their processes and identify opportunities for improvement. (For further information about Digital Technologies check-out 7 Digital Technologies that will Transform Your Factory)

Another approach is to adopt lean manufacturing principles, which refers to eliminating waste from the production process. One way to do this is through continuous improvement programs like Six Sigma or Kaizen. These programs enable you to systematically identify areas for improvement and implement changes.

Business Model Innovation

Business model innovation involves developing new revenue streams or business models that can drive growth and increase profitability. This can involve exploring new markets, developing new distribution channels, or offering new value-added services.

One approach to business model innovation is to develop a subscription-based service that offers customers ongoing value and generates recurring revenue for SMEs. This can involve offering a service that complements existing products or developing a new product that is sold on a subscription basis.

Another approach is to explore online marketplaces or e-commerce platforms to reach new customers and expand the SME’s reach. SMEs can also leverage social media and other digital marketing channels to build brand awareness and generate leads.

Collaborative Innovation

Collaborative innovation involves partnering with other companies, universities, or research institutions to access new ideas, technologies, and resources. This can help SMEs develop breakthrough products or processes that would be difficult to achieve on their own.

One approach to collaborative innovation is to engage in open innovation, which involves collaborating with external partners and crowdsourcing ideas. This can involve setting up innovation challenges or hackathons to encourage the development of new ideas or products.

Another approach is to develop strategic partnerships with other companies or research institutions to access new knowledge or resources. This can involve forming joint ventures or licensing agreements to share expertise and resources.

Open Innovation

Open innovation involves collaborating with external partners and crowdsourcing ideas to accelerate innovation efforts. This can involve engaging with customers, suppliers, or other stakeholders to tap into a broader pool of knowledge and expertise.

One approach to open innovation is to engage in co-creation, which involves collaborating with customers to develop new products or services. This can involve setting up user communities or customer advisory boards to gather feedback and insights.

Another approach is to leverage open innovation platforms or networks to access a wider pool of ideas and resources. SMEs can also participate in industry events or conferences to network with other professionals and share best practices for innovation.

In order to successfully implement open innovation, SMEs should create a culture that values and encourages innovation. This can involve setting up an innovation team or department, providing training and resources for employees to develop their innovation skills, and incentivising and rewarding innovation efforts.

Conclusion

In conclusion, innovation is a critical driver of growth for SME manufacturing businesses in the UK. By adopting an innovation mindset, SMEs can stay ahead of the competition, create more value for their customers, and achieve long-term success. Whether through product innovation, process innovation, business model innovation, collaborative innovation, or open innovation, SMEs have many options to explore and unlock their full potential.

Best Times to Post to LinkedIn, Twitter & Facebook 2019

Most Marketers, Business Owners, Social Media Associates are always trying to find the magical time to post on each platform, unfortunately there is no magical time, there is no cheat, no silver bullet.

It depends on your ideal audience, industry, products/services, content, consistency (always be mindful of consistency), there are multiple variables in play when posting to LinkedIn, Twitter, Facebook, etc.

Knowing the best times based on overall engagement will certainly give guidance and may even help to strengthen your social media strategy, but as with all things marketing, test it.

Sprout Social (based on their data of 25000+ customer interactions) have listed the best times to post on some of the major platforms.

Here’s an overview of the engagement reports for LinkedIn, Twitter and Facebook

LinkedIn

LinkedIn has seen significant increase in overall engagement, potentially making it a bigger consideration for your B2B marketing posts.

Sprout’s data shows the best time to post on LinkedIn is Wednesday, between 9am and 10am, and then at 12pm.

A quick overview of each weekday shows that; Monday is between 1pm-3pm; Tuesday is 9am, 1pm & 3pm; Wednesday 9am, 12pm; Thursday 9am, 1pm-3pm; Friday there seems to be a shift in morning to 10am-11am. (this is just my view but you can see the image for each platform and make your own judgements)

Best engagement is Wednesday with the least engagement occurring on Sundays.

Sprout LinkedIn

Twitter

It still looks like Wednesday and Friday are producing results as previous data, with Tuesday to Friday at 9am being a big block, but you can see that there is a band covering Tuesday to Friday from 9am-11am as well. The Twitter engagement I do find interesting as there are quite a few views you could take on this. Again, try and test!

Sprout says that Tuesdays and Wednesdays are the best days to post your tweets overall, which you can see from the image, a big band cutting across 9am-3pm, Saturday sees the least engagement.

Sprout Twitter

Facebook

The data suggests that updates posted on Facebook on Wednesdays, between 9am and 3pm, see the most engagement, Sprout narrows this down slightly from their analysis to between 11am-1pm. Thursday sees a good band between 9am-2pm and Friday also seeing high engagement between 9am-11am.

Sprout’s data also suggests that Sundays see the least amount of Facebook engagement overall.

Sprout Facebook

Excellent data from Sprout and you can view the full report ‘here’ for more on their opinion and analysis.

£1.5m Order Lost – Growth Mindset

An SME Manufacturer £8m turnover, LOST an order worth £1.5 Million to a competitor that didn’t even manufacture, just outsourced. Due to their continuous learning, performance and mindset of not concentrating on what to shrink, but rather concentrating on what to grow they had no issues in recovering the situation. Now there may be a million and one reasons why they lost that order, but their growth mindset, drive to be the best and ability to react as team in the face of that situation is what counts. Their thirst to continually be better.

No matter how well you do what you do, someday somebody is going to come along and try to do it better. That’s the nature of competition.

growth mindset

I’ve spoken to so many businesses over the past few months where complacency seems to be present, we’re doing alright, we’re making money, why do we need to improve. FOR EXACTLY THAT REASON ABOVE. You cannot predict the future, but you can ensure you are giving yourself, your team, and business the best opportunity to react to the positive and negatives that come along. It’s been fantastic to support, work with and see the transformation of the team and business above, remember…

Strive to be better today than your were yesterday, plan to be better tomorrow than you are today.

#UKManufacturing #GrowthMindset #Improve #Leadership #manufacturing

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Miss that moment – and you start to decline.

“There is at least one point in the history of any company when you have to change dramatically to rise to the next level of performance. Miss that moment – and you start to decline.” – Andy Gove

My personal view and experience is that it’s more than one point in time.

SMEs are characterised by their ability to adapt easily to market changes and their lean organisational structure (not as in Lean Manufacturing), which results in a more dynamic environment and a quicker decision making process. Although SME businesses vary widely in size and capacity for growth generally they will all follow a similar path: going from Owner/Entrepreneur with two or three employees to a business aiming for £10m or even £20m per year, and experiencing 20%/30% year on year growth and upwards along this journey. The sketch below illustrates an example of this, showing where most businesses may feel the pinch points of growth at key intersections.

SME Journey and Growth

Zero to £5m

The hard work really kicks in here. This part of the journey is often the one that is the most lonely, but often the most exciting. But it is here that most business owners feel the pains. Because it can be a lonely place, it is easy for owners to doubt themselves, they also don’t know what they don’t know which can be a limiting factor. And as an owner one of the main areas of responsibility is simply getting things done, which means you are working in your business as a manufacturer, and not working on it as a strategic leader.

In smaller SMES, management structures are also small with most owners being very hands-on. People are stretched across all functions all processes. Systems are not in place, IT is minimal or non-existent and there is a lack of standard processes. Utilising the Continuous Improvement and Management graph we can see that all levels are being worked with a very lean structure. Small customer projects, odd-job shop style of working.

SME Zero to £5m

As we get closer to a turnover of £5m, it becomes clear that things need to change. We are then moving from that odd-job, one off customer delivery to a mix of bigger projects, possible increased volumes and an increase in market share from your customers. As we start to scale-up from the initial start-up, decisions have to be made about the organisational structure, the company’s technology infrastructure, its business and marketing strategy, etc. With regard to organisational structure, you might now start to see the requirement for supervisory position(s) to take on more of the owners duties, the labour force growing, new machines, loans, investment, functional departments, Operations, Quality, Sales, Technical, Finance. This is where it can be rise or decline with those decisions. In scaling and growth and the opportunities it also brings its own set of problems, (albeit they are nice problems to have because its growth).

£5m to £10m

IT Systems and Planning may start to become an issue here, Microsoft Excel may no longer be good enough to manage your shop floor requirements (although I have seen £100m business still using excel but it was beginning to creak), and you are likely at this level to be considering MRP/ERP implementations. You may also look at outsourcing some functions, like Sales, Human Resources, Engineering Support, Quality, Quality Accreditation. All this requires a lot of investment in terms of time, money and energy. You need to do your homework to avoid costly mistakes, especially where IT is concerned, but it’s all opportunity.

And this stage, the business owner is now becoming more removed from the day to day operational tasks on the shop floor. This can be a very uncomfortable feeling in one or two ways. Firstly, the owner may want that hands-on role and not relinquish that part. It could be that the business is now at the stage where the owner is stopping it from growing, the entrepreneurial side is restricted as they are tied to the business. There a number of factors and variables in play, and having the right people is key, being a good leader is fundamental (at all stages).

SME £5m to £10m

£10m upwards

Financial Audits are required at this point (although some companies can be exempt if they satisfy certain criteria), so businesses need to be aware of the UK Audit requirements. Similar issues and opportunities still arise, but on a grander scale. Organisational structures are still fundamental, we might now start to see the need for Middle Management. We may also be looking to diversify into new markets, take on bigger orders, and higher volume. From £5m and up, some of your customers may not be the ones you want to deal with now, the one-off, low volume, job shop may not be your ideal customer. You might be seeing more of a need for Product Flow and Cells (Lean Manufacturing is a must from when you first start up), competition is high so you cannot stand still, even if your decision is to stay at a certain level. You will need to be driving for improvements to maintain the status quo, and your service has to be exceptional. Collaboration with a network of Manufacturers and or Partners, in my opinion, is key in this new world, and can bring some fantastic opportunities for growth. Again, IT infrastructure comes into play as the business is getting bigger: more employees, management leadership. The addition of new premises or additional buildings on the same industrial estate (this is where having a world class logistics operations pays dividends in not impacting your efficiency/productivity). The opportunities may now open up bringing the out-sourced services back in house, Sales and Human Resources, etc. At this level, you are likely to be making informed decisions based around data. Strategy alignment throughout the organisation is required, communicated and disseminated so everyone in the organisation knows the direction the company is going in and what the priorities are.

SME £10m upwards

Every business is different. One business’s pinch point may be at £3.5m another’s £7.5m but there will be very similar decisions to be made, but at this level the advantage is that businesses are likely to be able to make these decisions in a more informed way through data. Companies may not achieve sustained profitable growth unless they draft in the specialist skills required at the right time for the business. It’s the maxim that we don’t know what we don’t know. And the best advice is to seek advice from the experts in order to shift the dial in the right direction. This is something we can certainly help with, just contact the number below.

Ask yourself:

How much will it cost you not to resolve the issues that you are currently facing now or in the immediate future? How much will it cost you not to eliminate that pain? What are the lost opportunities on not taking your business to the next level or indeed keeping it at the level you want?

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Attention! – your Customers could be gone in 60 secs or less

Sales and Marketing

None of this is new and you probably heard it all before, but in my eyes that’s why it’s so important.

Sales and Marketing go hand in hand within any business, and every leader/owner should be working on their business (not in it) for a few hours a day.

But what do I mean working on your business.

Most businesses want to grow, so, you will have stated somewhere “I’m going to get from here to there by then”, now as an example this may be “Sales from £1m to £1.25m by end of 2018”.

So the working on your business (couple of hours/day), is all about the things you are going to do to get there. Now, you may have sales people, teams, etc.. this does not excuse you or absolve you of all responsibility in how, what, when, where, who and why in getting to that £1.25m.

Getting and Keeping Customers

This about your existing customers, new customers, finding new customers. (and attention is key, at 60 secs half your audience will have gone)

Examples may be:

  • Email campaigns, content, using the AIDA formula. (Attention, Interest, Desire, Action)
  • Sniper Marketing
  • New Products and Services
  • Reviewing your Social Media Impact (Google Adwords, facebook, twitter)

And don’t not underestimate the power of social media all because you are manufacturers, first port of call is having a website that is optimised and use friendly, something I’m currently sorting.

Sales Stats and Tips:

  • Over 60% of traffic is through mobile (phone/tablet). So, ensure optimised Mobile view first.
  • Over 50% of email is managed from mobile. Again, optimise for mobile viewing
  • At 60 secs half your audience will have gone (Attention is single most important word in marketing)
  • Your website load speed matters, big impact on ranking with Google.
  • Optimise your Linkedin profile, it’s not a CV, tell them where you add value.
  • 50 million Small Business on Facebook, 1.86bn active users, 66% log on every day. Search options are superb, but only 49% will support a brand liking, so how do we get in front of the others?
  • 56% of people would rather chat online than phone, you can now add chat boxes, Facebook messenger button, and more.
  • 67% will interact online with businesses.

But above all

DON’T FORGET TO ANSWER THE PHONE OR MAKE A CALL! (again remember attention, don’t answer in more than 5 rings and they’re probably gone.)

PS: It’s not the responsibility of your customers to keep you in mind, it’s your responsibility to keep you in their mind.

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Understanding your Competitive Performance

Understanding your Competitive Performance can be used as a differentiator as well as a enabler for growth.

Analysing where our business sits compared with our competitors (order losing, parity, advantage, superior) across the six categories of Quality, Cost, Delivery, Agility, Tech & Innovation and Customer Experience is an excellent way of highlighting where you need to focus.

Competitive Performance Analysis

If you’re sure your competitors are doing something better than you, you need to respond and make some changes. It could be anything from improving customer service, assessing your prices and updating your products, to driving process capability and performance.

Exploit the gaps you’ve identified. These may be in your product range or service, marketing or distribution, even the way you recruit and retain employees.

Customer Experience reputation can often provide the difference between businesses that operate in a very competitive market. Renew your efforts in these areas to exploit the deficiencies you’ve discovered, listen to the Voice of the Customer.

But don’t be complacent about your current strengths. Your current offerings may still need improving and your competitors may also be assessing you. They may adopt and enhance your good ideas.

Don’t stand still!

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We’re different it won’t work here

It’s been an interesting month, great meetings, new contacts and one of the most interesting presentations I‘ve given regarding Operational Excellence and Problem Solving.

The presentation was given to the Manufacturing and Construction sectors as part of a Seminar/Workshop.

The comments at the end we’re ones I have heard over and over again, “We’re Different, it won’t work here!

Is “we’re different” an excuse not try to improve?

This got me thinking in one of my reflective moments, what is it that naturally creates this push back? Do we think that Business Excellence, Operational Excellence, Lean or Six Sigma is a technical tool and technique, only applied to manufacturing, high volume processes, etc? Is it we naturally assume that it’s for the automotive industry?

There are a number of answers you can come up with that can be assigned to this emotion and push back.

So we have to ask ourselves

Do business improvement principles (as that is all they are) apply to pretty much every process? Yes, I’d say so. Does that mean its easy to put in place? Absolutely not. But that, along with being different, should be no reason to not try.

Which leads me on from last month’s article REFLECTION! and into OPERATIONAL EXCELLENCE TRANSFORMATION

We must first seek to understand what is it we are trying to solve, what problem? This could be as an organisation, function, sub-process.

Then we must ask,

What process improvement needs to be done? What do I need to design, re-design, improve to solve our problem and achieve our objective?

Next,

Do I have the capability in house? Do I have the skillset within my team?

We then come to,

What mindset do I need to have? Growth? (One of learning as we do not have the capability in house), Implementation (I have the capability so execute, or get support if you don’t), Experimental (try and test)

Remembering that Leadership behaviour and Programme Management are the key. The governance process you apply.

Final thought – it’s often said that “Operational Excellence doesn’t succeed or fail… it’s just a set of principles. What succeeds or fails is the organisation or the leaders who try.” Success isn’t guaranteed — it requires hard work and creativity to figure out how will work in your setting, because you are different!

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Manufacturing Websites, to web or not to web?

Recently I started a discussion regarding SMEs and their websites, the discussion started with this quote “an interesting observation this week whilst working, how many SMEs lack an all singing all dancing website. What’s the reason, with 90+% of people now looking on line this should be a priority.” Now all singing all dancing to me means bringing a Return on Investment. Here some excellent extracts and comments from the people involved, I’ve tried to get a balance within the discussion, and this is not my area of expertise.

Ashley Pearce: “In research I conducted recently an overwhelming number of those involved with Business Development in the UK Manufacturing Sector didn’t understand the actual function of a website.
Where does it fit in? Is it just a standalone item? Is it our “Digital shopfront“? Is it relevant in our industry?
These were common questions that we arrived at after a short discussion with most. It’s what inspired a number of articles explaining the “System of Modern Sales & Marketing” over on the Manufacturing Network UK Blog.
Fundamentally a Website is often NOT, but SHOULD be seen as, “Part of a System” for attracting, nurturing and converting leads into customers. Can you see the many ways your website & web presence CAN contribute to the system?”

Ashley Pearce: “For me, the most effective way to explain how a website “Fits in” has been to direct them towards the subject of “Inbound Marketing” – with FAIR WARNING. As we say over on the Manufacturing Network Blog almost weekly, “Wear Your Manufacturing Industry Blinkers” when reading anything about marketing your business online.

Most of the information, content and articles out there explaining how it works is NOT written for you, the UK Manufacturer. I think this is why an Integrated approach to Online Marketing and Offline Sales for UK Manufacturing has been very slow to evolve. Lack of “Context” – Explained in the UK Manufacturing Industry context, we may start to see some savvy marketers leaping ahead of the competition”

Garry Taylor: “There is a feeling that unless you can get on the first 2 pages of Google there’s no Point having a Web page. as we don’t actually do sales transactions over the Internet we view as an online brochure with the blog giving any up to date info and an opportunity for feedback plus, small companies are being pushed to pay per click. Everyone knows most people clicking on your sight are not buying so you pay for nothing.”

Richard Stinson: “I spent many years in the engineering sector, from toolmaker to technical sales and I had the privilege of working directly and indirectly with many SME’s as well as the giants like Rolls and BAE. I came to realise quite quickly that the big boys have regular web trawls looking for potential suppliers, just in case their current suppliers let them down or become swamped with work. They literally have a file of reserve suppliers on their list found online. The moral of this story is that unless the SME’s had an effective web presence they were overlooked for many of these lucrative contracts.”

Alan Kent: “Whilst I can appreciate that having a web site might bring you some business, not having one will definitely bring you none. I do feel that it is becoming a bit BS5750-ish though as having a fancy web site costs money that many SMEs would rather channel into capital equipment or a decent salesman who will definitely generate revenues. I can recall putting in a lot of effort into attaining BS5750 in the 1990s which cost a lot of time and money and brought in no sales leads whatsoever. At the time no-one had realised that it was simply a way of showing that you had a process and was never expected to generate leads but without it, you would definitely get no leads.”

Chris Davis: “There are loads of things you can do here. Small web site intelligently constructed .. put stuff on eBay and Amazon have a blog use social media .. Wiki presence .. the list goes on but none of these are difficult or really expensive. It’s not an option to not have a cyber presence?”

Jeremy Wisner: “The topic concerns the need for an ‘All singing/dancing’ website. For many SMEs, operating in specialist niches, it is questionable about the return on such a site. Absolutely, a solid and informative web presence is a must (largely for contact information and credibility). However, it is in the nature of many niche-SMEs that they will know who their potential customers are and will be cultivating B2B relationships via more direct approaches, rather than hoping to WOW website visitors. Niche products and services, by nature, often require specialised knowledge to explain to USP to potential buyers. Of course, retail is a whole different discussion.
90%+ will look online, yes. However, I’d argue that for the niche players, the hard yards have already been covered by the ‘song and dance’ created offline – backed up by effective SEO work – which again strengthens credibility.”

Adam Payne: “Disagree with you Jeremy, when I look at the SMEs including two that we were looking to acquire in a niche market, had limited website presence and no sales and marketing function, relying on word of mouth and guess how they were performing. If you are looking to expand your business you need an online presence, again as an example, recently I was supporting a company to try and source stretch forming, the search was not easy due to again lack of online presence and SEO setup, I ‘m sure to god there are businesses in the UK, but they missed a big opportunity. Now this is not my area, but if you are happy as a business then you stay as you are, but rest assured someone will be around the corner waiting to pounce if you are not bringing in customers, if you are looking to expand you need multiple marketing pillars and a top website is one of those with an inbound marketing approach (blog showing expertise, contact form with call to action, etc).”

Ashley Pearce: “This discussion thread has done a great deal in exposing the core beliefs that sit behind the reason / purpose / ultimate aim behind a website for a B2B Sales focused business.

The purpose of a website for B2C or retail is completely different. The website can have more to do with sales and sales fulfillment than it can with building the confidence of a prospect and developing a relationship.

Just because they look the same on the outside and are accessed via a web browser does not mean they are the “same thing”.

Fact 1: You are not going to receive sales through your company website in the manufacturing industry. You’re not selling products, you’re selling capability.

Fact 2: Buyers do their searching a researching online before EVER reaching out and asking for information, requesting a quote or expressing interest.

Lesson: If your website doesn’t start a conversation with the Buyers and Engineers visiting it, you will be overlooked…”

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Managing the Product Lifecycle: Forward Planning for Business Longevity

What is the product lifecycle?

Many of us have heard of the Boston Matrix, “cash cows” “rising stars” and so on, however whilst we understand the principle do not build it in to our day to day business. Managing the product lifecycle and using your understanding of this to ensure the longevity of your business is critical to long term success.

For each of our products and services, we should have a thorough understanding of where they are in their product life cycle, is the market for them still growing and developing, is it at its peak or is it already in its downward spiral? We should also have an understanding of what this means for the future of our business, if the product or service which we rely on to make the majority of the profits in our business is on a downward trajectory, that spells trouble and we should be focusing our efforts on other areas of our portfolio and product development.

Determining your place in the product lifecycle

Here are 3 questions you can use for assessing your products and services using the product lifecycle;

What pattern are you seeing in your sales? Are they rising, stagnant or falling?

What are your profit margins doing? Are they rising, stagnant or falling?

How profitable are you products and services? Which ones make you the most money?

Use the answers to these three questions to prioritise your product/services when you are allocating resources. By resources I mean time as well as money. If you have a product or service which is extremely profitable and has a growing market, this is where you should be spending your time, not on one of your older, potentially “classic” products which no longer has a stable market. This may seem like common sense but it can be incredible hard to be that brutally honest with yourself and your business and let go of the products or services that you are emotionally invested in. Use the numbers and the patterns to drive your behaviour, and be brutal about it! If you need help our Business Accelerator Programme might be of interest.

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