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Earning Trust One Holiday at a Time

I walked into a large chain furniture store. There was a line of salespeople waiting to pounce on anyone walking through the door. It reminded me of the scene in L.A. Story where Steve Martin’s character was waiting in line to use an ATM while another line of muggers waited to mug everyone after they got their money. It was almost that comical.

I wasn’t there to buy anything, just to gather information. (I’m the guy. Of course I don’t get to make final purchasing decisions on furniture. If they had been trained on personas, they might have suspected that in the first place.)

The sales lady was pleasant and helpful, finding all the information I needed. She was also trying all the closing techniques you read in all those books on sales. She definitely was trained in the Always Be Closing mindset. When it looked like I really wasn’t going to buy, she played the trump card.

“Do you know, our No-Payments-for-6-Months sale ends today?

I thanked her for her time and kept browsing. Then, as the playbook would dictate, her manager came over to try to close the sale she couldn’t close. It wasn’t happening. He left me with this …

“Do you know, our No-Payments-for-6-Months sale ends tomorrow?

For more ways to earn your customer’s trust, buy this book!

This is why customers don’t trust us. They know we are all about the sale. We’ll say anything to get that sale.

Thanksgiving is one of those opportunities we used to earn back some trust by showing we cared about more than just the sale. We posted every year on social media that we were choosing to stay closed on Thanksgiving and open at our regular time Black Friday morning. We did it so that my staff could enjoy the holiday and/or go shopping for Black Friday deals themselves. We’d have coffee ready when the shoppers visited at our normal hours.

This willingness to forego opportunities for sales paid off long term because it strengthened our reputation of caring more about people than money. Lose the battle to win the war.

Plus, that post went viral almost every single year.

Twice our local newspaper wrote about it. The radio and television news people talked about it several times.

Trust is fragile, yet it is a critical element for winning customers’ hearts and minds (and eventually their pocketbooks). When you sacrifice sales for the purpose of serving your staff, your customers, and/or your community, you build that trust up. When you say or do anything just to get the sale, you lose that trust. Your choice.

-Phil Wrzesinski
www.PhilsForum.com

PS If you are in a mall, you have no control over your hours. If you are in a strip mall or shopping center where there is a big draw that brings in a lot of traffic, it behooves you to be open for all those customers the other store is attracting. That’s smart customer service. But if you are a stand-alone or in an area where no one else is drawing traffic, you can choose to not be open early. It won’t cost you as much in sales as you think, but it will win you a ton in trust.

PPS If you cannot control your hours, there are other things you can do and state publicly such as pay your staff overtime, grant them extra comp time, have food for them while they are working, serve coffee for staff and customers, and donate to charity. Show the public what you truly value. Those that share your values will find you.

What is Worse Than That? The Lower Bar of Customer Service

This morning my bladder woke me up about twenty minutes before my alarm was supposed to go off. (TMI?) I am not a morning person so I was not pleased.

When something like this happens, you only have a few options. Tell your bladder you’ll get up when the alarm goes off and hope you don’t wet the bed. Get up and go, then try to get another fifteen minutes of sleep before the alarm sounds. Get up and start the day twenty minutes earlier than planned. (Or in my case, try to go back to sleep and instead write a blog post in your head.)

Can you think of anything worse for a non-morning person than having their bladder (or their dog or someone honking the horn) wake them up twenty minutes before they planned to get up?

How about going through the checkout with a cart full of groceries, have everything bagged and back in your cart, and then be told the cash register is frozen and you’ll have to go to the next register, and scan it all over again because they haven’t updated their hardware or software since Y2K, and then when you get to the other register the scanner isn’t working there either so you have to cart everything one more time and try a third register?

How about going to the big department store where you have been buying the same turtleneck for the past twenty-three years, getting to the department and finding the place trashed, having to sift through tons of shirts tossed everywhere until you finally find one in your size, going up to the checkout to find there are only two cashiers in a store of 150,000 square feet, and after waiting twenty minutes in line you learn that the shirts are an extra 30% off today only (if you can find another one in that mess in your size by yourself and are willing to wait another 30 minutes to checkout)?

How about reading an ad in Sunday’s paper, seeing an item you have been wanting for a while, and it is now on sale at a price you can afford, heading to the store that afternoon only to find your store never had any in stock in the first place?

How about walking into a store about 20 minutes before closing time and being told by the greeter (and I use that term loosely), “We’re closing soon so if you have a big purchase that is going to be a hassle you need to do it right away,”?

How about holding an item in your hand that is the right size, wanting a second one, and being told by a sales clerk too lazy to look something up, “They don’t make it in that size,”?

How about trying on a shirt, asking for a new size, and when the clerk comes back with the new size, asking if they have any more styles in that size and being told, “I don’t know,” before the clerk walks away never to return?

How about ordering a food item at a fast food restaurant and being told that it is cheaper to get a bunch of other items you don’t want with that item, so that you end up wasting food just to save money?

These are just a handful of situations that cropped up for me in the past few days. I asked the audience at the MAEDA presentation if any of them gave poor customer service, just treated their customers like crap. Not one person raised their hands. Then I asked them if anyone had received poor customer service in the past two weeks. Most every hand went up.

I tell you this to point out what is happening in terms of customer service and how that will affect you and your business.

The good news is that poor customer service is so rampant that it lowers the bar of expectation and makes the service you are striving to give look amazingly good.

The bad news is that as the bar of expectation gets lowered, so does the tolerance of the general public for getting worse and worse service. If you get complacent in the service you offer, you let the other guys win. You let them set the bar. Your slightly better service will seem outdated and expensive.

If you ramp up your service to such an amazingly high level that you surprise and delight customers at every turn, then you reset the bar in your favor and expose your competitors for the non-caring companies that they are.

The minimum would be to …

  • Make sure you have ample supply of anything you advertise on sale.
  • Make sure you have proper signage on the displays of items on sale explaining the deal.
  • Make sure you keep your merchandise neat and tidy and sorted and easy to find.
  • Make sure your hardware and software is up to date and functioning properly everywhere.
  • Make sure you have enough staff to make the shopping experience fun and easy.
  • Make sure your staff are trained to never say, “No.”

If you do the minimum, you’ll get the minimum. The maximum, however, has exponential returns.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, all of those experiences happened in major chain stores, but not all big box discounters. A couple happened in a store that has had a few rounds of closures. A couple happened in stores that should know better. I would like to say that I had some surprise and delight moments, too. Unfortunately, the only surprise was that they didn’t suck as much as I expected. Not exactly reassuring.

PPS Yeah, that’s how my brain works at 5:41am.

Robots Replacing Workers

I’ve been following the minimum wage hike debate for years. As a store owner, minimum wage had a direct impact on our bottom line. I never wanted to pay minimum wage to my team because I never expected minimum work. Yet, in retail, there are only so many dollars to go around. Add more to the payroll and you have to subtract from somewhere else, or grow your business enough to cover the added expense.

One of the arguments often used by those opposed to minimum wage hikes is that it would lead to more automation. I can envision that reality in big corporate chains for two reasons. The first is that many retail corporations don’t do anything to train their employees to maximum effectiveness. The second is that these same corporations also don’t value their employees or expect anything out of them. (Does anyone see the vicious downward cycle in this thought process?)

Robot scanning shelves in a Walmart pharmacy
Picture from Walmart’s blog

The reality of automation is coming to a Walmart near you. Walmart is testing robots in select stores in Arkansas, California, and Pennsylvania to help scan and stock shelves.

Jeremy King, chief technology officer for Walmart U.S. and e-commerce, said that the robots were 50% more productive than their human counterparts but would not replace workers or impact worker headcount.

Are you buying that? Do you really think Walmart is going to invest in robots that are 50% more productive and still pay all the displaced workers at the same time?

Automation is coming to the big stores and it will have a huge effect on their bottom line. First, they get a tax break for investing in capital infrastructure. Second, they get to replace less-efficient employees with robots who have no restrictions on hours worked, overtime, vacation pay, healthcare, etc. That’s a win-win for them.

It can also be a win for you. The more they automate, the more you differentiate. Automation is designed to give a consistent, expected, reliable outcome. It isn’t designed to surprise and delight. (Then again, neither is an untrained team, like what the big corporations are using now.)

Our payroll at Toy House was not only a higher percentage than any of our competitors, it was higher than most independent toy stores. Why?

Amazing customer service from a well-trained staff is the best, most effective form of advertising and marketing you could ever conceive.

What’s more powerful? Me telling you on the radio to shop at Toy House or your best friend telling you why she likes shopping at Toy House? What’s more persuasive? Me on a billboard on your drive home or your co-worker saying you should visit Toy House?

You don’t have the resources to invest in robots like Walmart does. But you do have the resources to invest in training for your staff. You do have the resources to pay your staff more (and expect more out of them in return). You do have the resources to make your customers’ experiences so wonderful they have to tell their friends. Call it your advertising budget if you want. But put your money into your staff. That’s where your ROI will be highest.

Investing in your team will always beat automation and minimum wage hikes. Always.

-Phil Wrzesinski
www.PhilsForum.com

PS Not sure how to raise the bar on your customer service to the point that people talk? Here are two free resources from my website:

Use those as a starting point for crafting your own training program.

If you need more, I can suggest a few good people to come in and work with you and your staff, including one guy who used to run a pretty cool toy store with a huge payroll.

Other Uses for Market Share Knowledge

The first time I was truly introduced to the idea of calculating my market share was from Roy H. William’s second book Secret Formulas of the Wizard of Ads. It was 2003 and I was trying to learn all I could about marketing and advertising. My math was rudimentary. I didn’t adjust for local economy or youth population. Simply raw numbers. I came up with our market share at about 12%.

At first I was a little disappointed. Roy teaches that the gold standard for any business is 30% market share. That’s a big number. Despite its dominance, even Walmart only has 25% of the grocery market. The optimist in me, however, said 12% was a good starting point and now I had a goal to shoot for. I had just read an article (which 14 years later I cannot find—go figure) that said only 9% of the general public was inclined to shop at local indie stores in the first place. I was already 3 points above that number.

I never did reach 30%, but I did have some other revelations about my Market Share number.

Image result for upward trend free clipartFirst, after going back and adjusting my market size for economy and youth population, our 12% was really closer to 16%. It stayed in that neighborhood until a Walmart Supercenter opened in 2005. We dropped into the 14-15% neighborhood and stayed there until Amazon became a serious player in the toy industry around 2010-2011. We stayed around 12.5% for the next several years until we closed. Even though you can beat a big guy head-to-head, the more big guys in town, the more businesses taking a piece out of the same pie.

Second, that original 12% number got me thinking. A full eighty-eight percent of the market were NOT currently shopping with me. That’s almost 9 out of 10 people. When you look at it that way, it changes your perspective on a lot of things.

In terms of marketing and advertising I realized I didn’t need to reach the entire market to grow my business. If I could just convince 1 more person out of 20 people to shop with me I would have growth beyond my wildest dreams. I really only needed to convince about 2 more people out of 100 to shop with me to have double digit growth. If you only are trying to sway two people out of a hundred you might say something totally different than if you’re trying to sway fifty out of a hundred. With two you can say something direct and personal to a small audience that gets right to the heart of the matter. Trying to reach fifty, you say something generic and non-offensive hoping other forces will come into play to swing them to your side.

In terms of product selection I realized I didn’t have to be all things to all people. I could pick and choose the products I wanted based on my beliefs in the products and how they benefited my customers. Not only does that help with the buying decisions, it helped us stay true to our core values in terms of what we sold and why.

Speaking of Core Values, we didn’t have to be someone we were not.

Meg Cabot said it best when she said, “You’re not a hundred dollar bill. Not everyone is going to like you.” We didn’t have to be liked by everyone. Sixteen percent is a pretty low approval rating. Yet it was higher than any other single store in our market.

Knowledge is power (France is bacon). Knowing your market share might be the piece of knowledge that finally liberates the way you think about your place in the market and the risks you can now safely take with your business.

-Phil Wrzesinski
www.PhilsForum.com

PS Let me first admit that 16% is actually pretty high for an indie retailer. Many of you might do the math and find yourself in the 3-5% range, especially if you have other indie retailers fighting for the 9% that skews shop local. But before I pat myself on the back, you should know that in the early 1980’s we were at that mythical 30% gold standard and then some. Of course that was before Jackson got Walmart, Target, Toys R Us, Sam’s Club, a second Meijer, a new KMart, and a whole slew of other big chains in town (without a population growth to match), and well before Al Gore invented the Internet. We were the large store that was here first. That’s what gave us much of our edge. But even if you do find yourself in the 3-5% range, if the market is big enough, you can do a lot of business with only 3-5% of your market. Plus, when you only have to convince 1 more person out of 100 to get 33% growth, advertising becomes a whole lot more fun.

PPS It used to upset me that about half my friends were not regular shoppers at my store. My parents saw about that same percentage from their friends. Then it dawned on me … Fifty percent of my friends versus twelve percent of the general population. I was ahead of the game. I slept much better that night.

Taking a Deep Breath of Perspective

We all meet interesting people from time to time. For one year I had a person enter my life that gave me a world’s worth of perspective. At the time he was the store manager of one of the big-box discounters in town. While our sons shared activities together, he shared amazing information not only about his store, but about all the big-box discounters in town. It was eye-opening to say the least.

If you have only recently found this blog, you should know that I am a big believer in calculating and understanding your overall market size for your category and knowing your share of that market. The easiest way to find the size of your market is to find national numbers for your industry, divide by the US population and multiply that result times your market population.

For instance, if you are in a $20 billion industry, divide that by 323 million people in the USA to get $62/person. If your market is 150,000 people, then multiply $62 x 150,000 to get a market size of $9.3 million. You can adjust that number up or down based on your local economy (your average household income versus the national average). You can also adjust for other factors like geography (more boats are likely to be sold in Michigan or Florida than Nebraska), or demographics (your percentage of children compared to the national average if your category is marketed primarily to children). It gives you a rough estimate, that if you calculate the same way year after year shows you exactly where you stand in your market.

I’ve been doing this in the Jackson market for decades and measuring our share over the years.

My big-box friend handed me numbers of what the big-box stores were doing in toy sales in our market. Adding them up, the math fit what I already knew about the size of the market in Jackson. The part that made my heart flutter was knowing that I was doing more in my single store than any one of those big guys.

 

Is it a Vase or Two Faces?

Here’s the perspective part … 

All of these stores do way more volume overall than I do because they also sell grocery, clothing, hardware, electronics, and household goods among other stuff. All of these stores have way more traffic on a daily, weekly, monthly basis than I could ever imagine. All of these stores run weekly sales and discounts with huge flyers in every Sunday’s paper to go with their national TV campaigns and other advertising efforts. All of these stores focus on the hottest TV-advertised toys every year, adding the vendors’ marketing efforts to their own. All of these stores get full-blown media coverage, too.

Think about that last one for a second. This holiday season you are going to hear stories about Amazon, Walmart, and Target. All. The. Time. You are going to hear about their sales. You are going to hear about their overall volume. You are going to hear about their strategies to draw more traffic (more discounting—you read it hear first!) Your customers are going to hear all that, too.

Yet locally, without the discounting, without the hot items for your industry, without the national TV campaign and Sunday flyers and vendors marketing for you, without all the grocery-driven traffic, without all the media hype, you’re going to stand toe-to-toe with these big giants and still do amazing numbers in your category, maybe even equal or better than they do individually.

When people tell you it is all about price, and that discounting is the only way to get sales, go ahead and nod your head in agreement until those uninformed people walk away. Then remember that a guy in a small, depressed, blue-collar city in Michigan with all the inherent disadvantages was able to beat all the big guys through better service, better staff, product knowledge, smarter marketing, and higher prices.

You will, too!

-Phil Wrzesinski
www.PhilsForum.com

PS Calculating Market Size and Market Share can be incredibly helpful, even if your business is growing. If your market is getting bigger, but your share is decreasing, then even though you are growing, you are still losing out to competitors. Something needs to be fixed. It can also help you understand why sales are decreasing and when to get out of the market. We saw our market shrink to a size that wouldn’t sustain us in our current model. Our options were to shrink to fit the market, move to a different market, or close. We chose the latter so that I could spend my time helping a bigger market … you!

PPS That store manager left Jackson the year after we met to run a larger store in another part of the country, but not before leaving me with a wealth of knowledge and a perspective for which I am eternally grateful.

Who Killed Black Friday?

I was never big on shopping on Black Friday. I don’t think it was just because I was a retailer. Many of my staff would be up before dawn hitting all the sales before coming in for their shifts. I knew other retailers who would also hit the streets looking for early-bird deals. Since I wasn’t a bargain hunter in general, it wasn’t a big attraction to me.

I also knew a secret. I knew that the same retailers filled with door-busters that day would have similar or even better discounts the week before Christmas. Such is the nature of the season year after year.

Image result for black friday doorbustersAccording to Wikipedia, “Since 1952, [Black Friday] has been regarded as the beginning of the Christmas shopping season in the U.S.” What most people don’t know is that it wasn’t the “busiest shopping day of the year” until 2003. The Saturday before Christmas regularly held that title most years.

If the new study from Market Track LLC is right, you might see Saturday, 12/23 reclaim the title as fewer people in their surveys say they will be out shopping Black Friday this year. Is this the end of Black Friday as we have known it? And if so, who killed it?

The easy answer is eCommerce. The article linked above is already calling it “Cyber Friday”. More people reported in the survey that they would be shopping online. The online sellers are no fools. Rather than give up on Black Friday and wait until Cyber Monday, they are going after the customers’ dollars all Thanksgiving Week and especially on Friday.

The other culprit is the big retailers themselves. In a quest to win the Black Friday customers, they started opening earlier and earlier until a bunch of them decided to do sales on Thanksgiving, which led to sales on Monday, Tuesday, and Wednesday, too. You do all that and you take away the frenzy of Black Friday. The problem is most employees only have Thursday through Sunday off. Twenty-five states actually have Black Friday as a government holiday. Start offering your deals Monday through Wednesday and you lose some of your customers. They figure they might as well go online since they can’t get out of work.

Some want to blame the media. News reports of fights and people getting trampled will dampen any crowd. The reality is that those stories don’t match the experience for most people since those events are few and far between.

Last but not least, some are saying that American Express with it’s Shop Small Business Saturday campaign also had a hand in Black Friday’s demise. We certainly saw that in our last few years of business. Small Business Saturday beat Black Friday for us in 2013, 2014, and 2015.

Add it all up and you might think Black Friday is on life support. Before you pull the plug, however, think about this.

Twenty-five states still have Black Friday as a government holiday. Many corporations also give their employees that day off. That puts a lot of shoppers on the streets ready to get started on their Christmas shopping. Whether they shop online, in stores, Friday, Saturday, or Sunday doesn’t matter.

What does matter is one thing and one thing only—are you the store where they want to spend their money?

The big chains, in their race to the bottom to win the Transactional Customers, only have one tool in their tool box—the red markdown pen. You have a whole bunch of tools at your disposal to win everyone else, the Customer Experience being one of your biggest.

If you are a toy store you could have a whole bunch of toy expert stations with people ready to show off the hot, new toys and answer questions parents might have (many toy stores I know already do this earlier in November for Neighborhood Toy Store Day.)

If you are a clothing store you could have a fashion show with real fashion experts on hand to share tips and help people explore new wardrobes for everyone in their family.

If you are a shoe store you could have certified orthotic fitters on hand to do demonstrations and talk about foot health and the importance of proper support.

If you are a caterer you could partner with a local retailer and offer food to their customers creating a festive atmosphere for the shoppers that becomes a win-win-win for everyone.

There are many ways to win customers during Thanksgiving Week. You know already what the big box and online sellers are going to do. There are a whole bunch of people actually happy that Black Friday won’t be as mobbed with bargain hunters as usual. Go talk to them and show them how shopping at your store will be different, better, and tons more fun.

-Phil Wrzesinski
www.PhilsForum.com

PS It might seem weird to talk about Thanksgiving already. It is only 6 weeks from today. I want you to have enough time to plan something amazingly cool to maximize your weekend sales. If you’ve already seen your sales shift from Friday to Saturday like we did, then plan something special for Saturday to win the Relational Customers. But if you can, plan something special for Friday, too. There are a lot of people not working that day that still want to go shopping.

PPS Don’t read too much into your Friday or your Saturday numbers. Look at the week as a whole. The retail world is changing. Black Friday is no longer the sole focus of the week. But attracting customers hasn’t changed. Go find a way to capture your share of the market.

How to Teach a Class in Your Store

You know why you need to teach classes in your store. Here are the six steps you take to create a class that draws traffic, builds excitement, gains you followers, sets you up as the expert, and makes people want to buy from you.

  1. Determine which product(s) you sell that takes the longest to explain or takes the most trips before the customer pulls the trigger. These are the items to build your class around because these are the items that require an expert. The more questions a customer asks about a product, the more likely you’ll find people wanting to attend a class to learn more.
  2. Write down all the questions a customer typically asks about the product. Then add in two more questions you think they should be asking. This will become the outline of your presentation. (You can brainstorm this list with your sales staff.)
  3. List all the benefits of the products (remember, a feature is what the product does, a benefit is why that helps the user).
  4. List all the downsides of the product. Everything has a downside. If you don’t tell your customer up front, she will think you’re hiding something. Being honest about the downsides wins you trust.
  5. Get the customer to visualize using the product in her home or in her life. Ask questions like, “How would you use this?” Where would you use this?” “Do you see yourself using this?” “How would this affect your life right now?” This moves the customer from being in analytical mode to being in ownership mode. We only do in real life what we have already visualized in our minds. Get your customer to visualize owning the product and you will be more likely to win the sale.
  6. List all the reasons why someone should buy this product from you. If you offer services like layaway or financing or delivery or assembly, this is when you share that information. If you truly have answered all the most important questions including the ones they forgot to ask, and you have helped them visualize owning and using the product, then you have their permission to sell them. Just remember that you aren’t selling a product, you are selling a solution.

That’s the class. It is no different than selling to one person while a bunch of other people sit in and listen. You can decorate with comfortable seating, snacks & prizes (ask your vendors for giveaways), cool signs, etc. Just make sure you follow the steps above so that you offer a true benefit to your customers. They’ll thank you for the effort with their pocketbooks.

-Phil Wrzesinski
www.PhilsForum.com

PS Don’t worry about attendance. You might get 30 people, you might get 3. Make them feel special. Go above and beyond what they expect. Not only will you get the sale, you’ll get the referral, which is often a more powerful sales tool than the class, itself.

PPS Just a reminder that it doesn’t have to be that expensive to advertise. Social media, email, your website, some in-store signage, and a few online community calendars will draw a crowd. Make it worth their while and they’ll help you draw the next crowd.

Hinkley Donuts, Or How to Go Above and Beyond

I had a Hinkley Donut this morning. My favorite is chocolate frosted cinnamon, but I could eat any of about a dozen of their different donuts with equal pleasure. Those of you in Jackson know what I mean. In a statewide competition Hinkley’s Bakery won Best Donuts in Michigan (if they hadn’t there might have been an uproar – or at least a road trip to see if it was true that there existed something better).

When I eat Hinkley Donuts I often think about Ernie.

Hinkley’s Donuts – Best in Michigan!

Ernie sells chairs. Not just any chairs, but fully customizable, fits everyone, incredibly comfortable, office chairs. I put Ernie in the hot seat and asked him about his sales process. He led me through the cold calls, the visits, the dog-and-pony shows, the follow-ups, the closing of the sale and the delivery.

At each point of contact I asked Ernie what his staff was instructed to do. Then I stopped him, and everyone else in the class, and asked, “What does the customer expect out of you at this point?”

This was an eye-opener for everyone in the class. We know what we do, but we rarely stop to think about what our customers actually expect and want. Yet, that is the secret to great customer service – meet your customer’s expectations. In fact, that is critical in today’s connected world where if you fail to meet their expectation, all 962 of their friends on Facebook will know by tonight, and visitors to Yelp and Google will read about it for years.

If you aren’t doing this exercise, you might be missing a critical problem in what you thought was your awesome customer service that has been holding you back.

Once we established the customer’s expectations I asked Ernie a second question. “What would it look like to exceed your customer’s expectations?” If you want to take your customer service to the level where it generates Word-of-Mouth, you have to exceed your customer’s expectations. 

Ernie’s sales team did early morning or early afternoon visits to show off his chairs. We wondered what would happen if the sales people showed up with Hinkley Donuts (well, okay, the equivalent in that town) for morning meetings or Klavon’s Pizza for afternoon meetings. All it would take is a simple call to the local Chamber of Commerce to find out which local bakery or pizza joint is best known in town. A good salesman could probably find a way to get that info in a conversation. I told Ernie, don’t announce you’re bringing the yummies. Make it a surprise. As Roy H. Williams says, “Surprise is the foundation of delight.” It was a simple change, an inexpensive change, but one that would pay high dividends.

By the time Ernie was out of the hot seat he had several ideas of how to meet and exceed what his customers expected. I’m pretty sure he’s been doing that ever since.

When you go above and beyond what your customer expects, you will delight her and win her as a customer. No matter what competition you face, no matter what technology disrupts your future, that will always be true.

That’s what I think about when I eat a Hinkley Donut.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, I can be bought with food. But it isn’t so much the food itself as it is the gesture. You went above and beyond because you found the local source and made the effort to ply me with something unique, not generic or mass-produced. That’s a powerful statement that earns a lot of trust.

In Retail it is All About Location

Let’s get the elephant out of the room right away.

How can I write a blog about being a successful retailer when I closed my retail store? I can sum that up in three words…

Location. Location. Location.

Yes, we were having a tough time with cash flow. That’s the usual culprit behind any store closing. Much of that was due to our location.

Location Issue #1

The population of Jackson has been stagnant at best the last several years. The youth population, however, has shrunk considerably over the last several years as birth rates declined for all groups but teens, and school enrollment is down huge since 2007. On top of that, average household income in the city fell from around $35K per household to $27K per household (well below the national average of around $56K).

I have constantly talked about paying attention to your Market Share. To know your Market Share you first have to know your Market. Ours has shrunk over 40% since 2007. Fortunately, our share of that market only dipped a little. We still had our piece of the pie, but our pie had turned into a tart.

Location Issue #2

We own and occupy a large building on the north edge of downtown. We have been a large toy store for decades, carrying toys, hobbies, baby products, sporting goods, scouts, and more. When the market could bear it, we had a ton of inventory, but scaling back inventory to match the needs of the community meant less efficient use of space and less of the “impact” of being that large store that had everything.

We discussed converting to a smaller store, more in alignment with the population and income, but that would have led to many long-time customers lamenting that we just weren’t the store we used to be or the store they remembered. Better to close while the memories were still positive.

Location Issue #3

I am a big believer in downtowns. Call me naive but I still believe downtown shopping districts can be successful. It takes dedication from the shop keepers, the landlords, and the city leaders to make it work. It takes smart policies, united fronts, and strong relationships to make it work. We have some of that in Jackson, especially among the retail owners. We also have a city council dedicated to improving the streets and sidewalks and green spaces in our downtown. Unfortunately, that also means a ton of disruptive construction. Two years of it! (and counting.)

Our city leaders are not retailers and don’t understand how construction affects retail. They saw an opportunity to get roads fixed and attract new development (all good things), but didn’t see the consequences to the existing retailers and restaurants. When you are trying to dig out of a cash flow hole, having the busiest street in town – the one that goes right by your building – be restricted from three lanes to one with backups that stretch for blocks for an entire spring and summer is not a good recipe for success. At one point we had so much construction downtown that one detour actually led you to another street closure dead-end, and only if you had local knowledge would you know which alley would get you back to open road.

In a couple years, our downtown is going to be new and fresh and repaved and ready for business. But the last two years were pretty tough on the businesses already here, especially for us as our market declined.

Yeah, Amazon is a deal-changer for many retail categories. Yeah, our own vendors are making decisions that hurt the indie retail channel. Yeah, customers are as fickle as ever and have power like never before. None of those are insurmountable. You can still compete. Even as we closed, we were holding our own for our market. We just didn’t like the direction our market was heading.

If your market is your problem, you can do one of four things, Move, Close, Change or Wait. We chose to close.

Now you know.

-Phil Wrzesinski
www.PhilsForum.com

PS I’ll discuss the other three options and what would make them attractive in future posts. Right now I have to go let the big elephant in the room out to roam the savanna.

Friends With Benefits

Align yourself with charity. Pick one or two local organizations (or more if you’re up to it) that you feel strongly about. Do something special for them. Help them out. Be their friend and ally.

You’ll both benefit from the friendship.

Santa Paws 2015 #1

This is a picture of the Cascades Humane Society doing their annual Santa Paws event – pictures of your pet with Santa Claus. They called me a few weeks ago looking for a space to take the pictures. I have a stage. I love dogs – especially rescued dogs. I said yes.

They coordinate getting Santa here. They hire the photographer. They set up the backdrop. They sign up and schedule the photo shoots. They work the tables. They get the profits.

We get the traffic. We get the goodwill. We get the customers telling us how nice it is that we are doing this for them. We get the social media exposure. We get exposed to everyone on their mailing list. We get our name mentioned in their press releases (and non-profit press releases get picked up far more often than for-profit press releases).

Our friendship with them brings benefits to both of us.

When you partner with a charity, you expand your reach. You get exposure to a crowd of generous people who love to give to charitable causes (can you think of a better demographic for the independent retailer?). You get touchy feely goodwill because you are helping out. You don’t just look like a greedy merchant. You strengthen your community (the better the non-profits do, the better everyone does).

Make friends with a charity or two. You’ll reap the benefits.

-Phil Wrzesinski
www.PhilsForum.com

PS Your charity doesn’t have to be aligned with what you sell. We don’t sell pet toys or pet food. Pick charities based on a few different factors such as…

  • Do they have an active base of followers?
  • Do they want to “partner” with you (or simply have you do all the work)?
  • Do they align with your own personal core values?
  • Are they well-respected in the community?

Those are all good reasons for making friends.