There’s an uproar in the toy world and I want to give you my take on it – be sure to read the whole article.
One of my major vendors, a long time player in the specialty toy industry, just gave a whole bunch of exclusives to Toys R Us. Many independent toy stores are understandably upset. Not only does it cut into our margins, it makes us no longer look like the experts – one of the factors we use to compete against the big box stores.
Someone asked my opinion on it. I figure I’d share it with you, too. It’s pretty simple.
S**t happens…
Yeah, it was the specialty stores that helped build this brand in the US. So what? Yeah, it was a major difference between us and our big box competitors. So what? Yeah, it was a huge customer draw for us. So what?
If I had a dollar for every toy that used to be exclusively sold in specialty stores that eventually found its way onto the shelves at TRU, Wal-Mart or Target, I’d be retired by now.
Unhappy Customers Equals Unhappy Store?
No, it’s not fun when a customer comes in wondering why the “school” you’re selling is almost twice as much as the “school” at TRU. She doesn’t care that their school is smaller and doesn’t have all the accessories. She also doesn’t understand why you can’t get all the other stuff she saw at the other store. And she really doesn’t care that some of the price difference is because of their buying power – heck, that’s reason enough for some customers to go running from your store immediately.
All she knows is that she has a problem and you’re not being part of the solution.
But like I said before, this happens all the time. And there are pretty much only two reactions I can have.
- Be pissed and angry and let everyone see how unhappy I am with my lot in business (life).
- Accept it as part of doing business as an independent retailer and put a smile on my face while trying to show the customer what I do have and what I can do.
Of course you are going to choose #2. That’s what the smart retailers do.
Not Their Fault
It isn’t the vendor’s fault. The vendor needs to make money. Selling to the big chains is one method of doing that. And you don’t know what is driving their actions. Maybe the indie stores haven’t supported them enough. Maybe there is pressure from a silent partner or parent company. Maybe there is enough demand that going big is a necessity.
Whatever the reason, it happens all the time in the toy and baby industries, and I would guess it happens in your industry, too. It just isn’t worth getting your panties in a bind.
Take the High Road
You can choose to drop that vendor. Just don’t think it will show them any lessons. If anything it will embolden them that they made the right choice going mass.
You can choose to evaluate the vendor financially. Are they still drawing customers and making you money? Then keep ’em. If not, drop ’em.
You can choose to tell your customers what a horrible company they are in doing that to you. You might win some sympathy, but you might also come across as sour grapes. Remember that it is about the customer and her problems, not you and yours.
The better approach is to see if what you have will fit her needs. Focus on solving her problem with what you have, not what you don’t. Focus on what you can do, not what you can’t.
Bottom Line
In the end you have to take care of your own bottom line. That means first and foremost taking care of the customer, making sure she has a positive and rewarding experience in your store and that you do whatever you can to solve her issues and make her happy. No matter what a vendor does, there is no excuse for a poor attitude from you.
It also means evaluating your vendors from a strictly financial sense. Is their product still drawing customers and making you money? Good. Don’t let your emotions get in the way of a proper evaluation of a potential profit center.
At some point a vendor’s actions will not be in your best interest. Rarely do those actions cause major damage to your business. Your reactions to their actions are usually the culprit. So take control of your actions now, and reap the benefits later.
-Phil