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Author: Phil Wrzesinski

Be Special at Your Specialty

I was sitting in a new restaurant last night and it dawned on me that sometimes as business owners we get so caught up in cash flow, marketing, inventory management, competition, staff training, worrying about the Internet, etc. that we forget to be special at our specialty.

If you are a toy store you better have absolutely wonderful toys.

If you are a baby store you better have the most sensible or fantastic products available.

If you are a jewelry store you better have sparkle.

If you are a brewpub you better have wonderful beers.

If you are a clothing retailer you better have the right fashions.

Yeah, maybe that goes without saying. But sometimes we get so caught up in the trees that we do not see the forest.

Your customers will not care that a vendor does not have a Minimum Ad Price.

Your customers will not care that the sales rep screwed up the order.

Your customers will not care that you have to pay more in property taxes or income taxes or business taxes.

Your customers will not care that shipping costs have gone up, health care costs have gone up, utilities have gone up.

Your customer will not care that you did everything else right.

Their first and foremost concern is that you are special at your specialty. Make it so and the other stuff is much easier to accomplish or work around.

-Phil Wrzesinski

http://www.philsforum.com/

Is Self-Serve Checkout a Good Option?

Rick Segal posted a blog talking about the pros of self-serve checkouts. The cost for them is coming down. They never have a lousy attitude. They are cheaper to maintain than paying an employee. Rick even goes so far as to say that all retailers should be utilizing every option that saves them money.

Do you agree?

I don’t.

As a specialty independent retailer the one advantage you have over the competition is service. Incredible, over-the-top, WOW service. Sometimes that costs money.

The checkout is the final memory your customer has of your store. It is the takeaway, the lasting image they will have. Are you willing to give that over to a machine?

Sure, I get Rick’s premise that a bad attitude at checkout can be harmful. Equally so, an awesome experience at checkout can cement a customer for life. A machine cannot give an awesome experience.

At its best, self-serve checkout is neutral. It didn’t piss off the customer. But you and I have had plenty of experiences where self-serve checkout has been less than its best.

My wife has learned not to send me to Kroger. I will not go. I have had such horrible experiences with their scanners that I cannot stand the thought of shopping there. Yet almost every time I have gone the only lane open is self-serve. Apparently other people are complaining, too. Kroger is taking out their self-serve lanes in Texas as an experiment.

Albertson’s grocery is also removing their self-serve lanes. They have seen average transactions drop at their stores since they put those lanes in. I would venture to guess it is because people would rather buy less than have to scan so many items themselves.

To give WOW service to your customers you just need to train your cashiers the same way you train your sales staff. Get everyone on the same page with the same goal. Give the customer an experience so wonderful she has to tell her friends.

You cannot get that from a cold, impersonal video screen.

-Phil Wrzesinski

http://www.philsforum.com/

PS I outline exactly how to give WOW Customer Service at the checkout in my free eBook Customer Service: From Weak to WOW!



PPS I hate the Kroger experience so much that I have been begging my local grocery store to carry the three items we eat regularly that we can currently only find at Kroger. I know they can get those items for me. But they don’t. Hmmm… Might be another blog post in there.

“No” is Not Acceptable

“Do you carry this product?”

“No.”

End of conversation. End of interaction. End of sale. End of business.

There are millions of products out there. You have 5,000 in your store. The chances are pretty good that your customers will ask you for something you do not have. How your staff answers goes a long way towards your success.

Do they ask why?

“No we don’t. What exactly are you looking for in that product? Why do you want that product? What are hoping that product will do for you?”

Do they offer alternatives?

“No we don’t but we do have this other product that I actually like better because…”

Do they give explanations?


“No we don’t. We used to carry that product but had too many problems and switched to this other brand.”

“No we don’t. That brand is only mass-produced for large chain stores. Let me show you something of which you probably haven’t heard that does the job better.”

Do they offer help in finding the item?

“No we don’t carry anything like that. Would you like me to call this other store for you to see if they carry anything it or anything similar?”

If you are hiring friendly, helpful, caring people they might already do this just because of who they are. If they are not, then you need to train them that when the customer asks, “Do you have…?” they need to know how to respond.

-Phil Wrzesinski

http://www.philsforum.com/

PS You are probably thinking, “Aren’t we all hiring friendly, helpful people?” In theory, yes. But in practice most store owners tell me this is the hardest part of their job. It was for me, too. Until I learned a secret. Quit hiring for experience and start hiring for character traits. You can read all about it in my book Hiring and the Potter’s Wheel: Turning Your Staff Into a Work of Art. The book is $19.99 plus S&H. Far less than the cost of one more hiring mistake. You should buy it. You can read it in one sitting. Yes, one sitting. It will make a difference.

Growing in a Shrinking Market

Our market is shrinking.

The 2010 census showed that we have 3200 fewer children in the county than we did in 2000. For four straight years the number of births in the county has dropped from the previous year. Plus, people are spending less on toys than ever before thanks to the economy and the electronics market.

The toy-selling pie has shrunk considerably. (In fact, it is more of a tart than a pie right now.)

Yet, I still have all the same competition. More, if you include the explosion of ecommerce websites. My expenses like utilities, health care, and property taxes continue to go up. And my access to profitable lines of products gets smaller each year as vendors use discounting sites to move their products or choose to sell direct online.

Sounds like a recipe for disaster.

There are three ways to combat this disaster and stay profitable as a company.

Right Size Your Business

Rather than focus on growth, focus on being the right size for your market. Shrink your overhead by moving to a smaller location. Trim the fat out of your staff by letting the poorest performers go and training the remaining staff to do more. Bring some of the outside services like payroll and accounting back in house.

Rather than lament the losses, figure out exactly what the market will bear and what your take of that market should be. Then build your business around that size.

Grab Market Share

When the pie is shrinking, you need to get a bigger piece of it. You do that by hyper-focusing on your strengths. Carry exclusive brands that cannot be found everywhere. Ramp up your customer service beyond any level previously seen in your area. Make your marketing stand out so that it moves people to want to shop with you.

That last one is easier than you think. You can take greater risks with your marketing when your back is against the wall. Go ahead and be remarkable and memorable and moving. What have you got to lose?

Expand Into New Markets

You can do this two ways.

First, consider moving into a different geographical market. Go find a town that is growing or under-served in your category and move or expand your business there. Or add eCommerce to your website and see if you can grow sales all over.

Second, find new complimentary product markets into which you can expand. If you sell toys, can you sell books or hobbies or baby products? If you sell furniture can you sell decor, wallpaper, paints, appliances? If you sell jewelry can you sell scarves, hats, or purses?

Both expansions are tough and can be costly. You’ll have new competitors, new costs, new headaches. But when times are tough, you have to be tougher.

If your market is shrinking you can still grow. You just have to do it and measure it differently.

-Phil Wrzesinski

www.PhilsForum.com

PS For the last few years we have focused on grabbing a bigger piece of the pie through better customer service. Right now our market share is over 11% in both toys and baby products. This year we have been right-sizing, too. Next year? Expansion? Yeah, in some way, shape or form. Stay tuned…

How Much Retail Shrinkage Do You Have?

According to the National Retail Federation, in 2010 Retail Shrinkage rose to 1.58% of all retail sales.

(Note: Retail Shrinkage is the difference between your physical inventory and your “booked” inventory, divided by your total sales)

What is more interesting is to what NRF attributes all that shrinkage.

  • 44% is due to employee theft

  • 33% is due to shoplifting

  • 23% is due to other errors (billing, receiving, cash register, etc.)

Think about that…

Two-thirds of your shrinkage is caused by your staff either intentionally or unintentionally.

Here are some ways to shrink your shrinkage.

Shoplifting

Make sure you greet each customer coming through the doors. Shoplifters love anonymity. Saying hello can sometimes be the best deterrent. Wal-Mart has an amazingly low 0.75% shrinkage and I’m sure those greeters at the front door play a part in that.

The next best thing is to be available. If your staff is always walking the store working with customers then would-be shoplifters have no place to hide. In fact, make sure you design your store so that there are no hidden places. And if you cannot avoid them, visit them often. Just as a policeman on patrol deters crime, an employee on patrol deters shoplifting.

Video cameras are helpful, too, but they come with a couple downsides. As a deterrent, they have to be visible. Would-be shoplifters have to know they are being taped. But that can cause some of your better customers to feel uneasy and not want to shop in your store. Plus there is the added expense of the system. But if you are in a high-crime area or sell a lot of high-ticket items that can be easily pocketed, cameras can be your best investment.

Employee Theft

The three biggest reasons employees might steal…

  1. They are thieves to begin with – you should have done a background check!

  2. They do not feel any ownership of the store.

  3. They are pissed at you and want to get back at you.

Take care of your staff. Empower them to make decisions for the store and they will feel ownership. Reward them for great behavior. Treat them with respect as human beings. Be aware of their time, their needs, their families. When you talk about the staff as “we” instead of “they” your staff will feel like part of the family and most of them will not steal the merchandise.

Errors

Check, double check and triple check.

Check that the order confirmation from the company matches the order you requested and entered into your computer. (You do request order confirmations, don’t you?)

Double check that the packing list matches what is in the boxes.

Triple check that the invoice matches what you actually received.

Our shrinkage has averaged about 0.3% for our sixty-two year history. With an inventory as deep as ours, a store as large as ours, and the number of employees we have, we’re pretty happy about those numbers. What is your shrinkage?

-Phil Wrzesinski

www.PhilsForum.com

PS For more on keeping your inventory under control, check out my free eBook Inventory Management. Thirty seven businesses downloaded it last week to help improve their cashflow. What do they know that you don’t? (Hint: download the book and find out)

What is Your Eustress?

I learned a new term.

Eustress – (yoo’-stress) A stress that is healthy or fulfilling.

Think of Eustress as the opposite of Distress.

We all have stress in our lives. As store owners, we often take on added stress that outsiders cannot comprehend. But not all stress is the same. Stress falls into those two categories – Eustress and Distress.

The key to your success is to make sure you have enough Eustress on your plate to offset all the Distress.

For instance, I find teaching classes like the Shopping For Baby 101 classes at the store and the New Dad classes at the hospital to be in the Eustress category. I love prepping for them and teaching them. I feel better after they are done.

The same is true with writing this blog, giving talks to other retailers, writing my eBooks and reading business books. Only if those things get in the way of doing my job do they shift over to Distress. But since many of them augment my job, I will keep on doing them.

Distress for me includes meeting with bankers and lawyers, dealing with unhappy customers, and mediating staff disputes.

So I try to make sure I have enough of the one to offset the other.

If ever you have a friend, spouse, mentor or advisor tell you that you have too much on your plate, list all of your stresses and label them as either a Eustress, Distress or Neutral (something that doesn’t even feel like a stress and does not move your needle one way or the other.)

Then you will know exactly what to do. Delegate all the Neutrals and drop one or more of the Distresses. Keep all the Eustress that does not get in the way of your job. Your problem will be solved.

-Phil Wrzesinski

www.PhilsForum.com

PS Aahhh… I’m feeling better already:-)

Are You Google?

Yes you are! (or at least you should be)

Google is a search engine that helps you sort billions of pages of information into the most relevant answers to your question.

Just like a smart salesperson.

Customers now have more information than ever before. They have spec sheets, reviews, pricing, and a whole lot more. In fact, they are overloaded with information, some of which is not as helpful as it could be.

The smart salesperson works like Google to sort that information so that the customer hears only the most relevant and important information needed to make a decision.

Here is how it works.

The smart salesperson starts by developing a relationship with the customer, getting to know her. Then the smart salesperson begins asking questions to find out not just what the customer wants, but why she wants it. The “why” is the search box, the question that sorts the information. From there, the smart salesperson uses his or her product knowledge to find the most relevant reasons why a certain product solves her needs.

To find the why, the smart salesperson pays close attention to the underlying problem needing to be solved.

“I need a new curtain for my son’s bedroom. The sunlight in the morning is waking him up too soon.” (I need something to make a room completely dark.)

“I need a new TV for the man cave before the playoffs begin.” (I need a TV that shows off sporting events superbly.)

“I am looking for a gift for my seven-year old nephew that lives in California.” (I need something for a young boy I rarely see because he lives so far away that I can ship easily.)

When you understand the why behind the purchase you are better equipped to answer that why with the product and benefits of that product that are most relevant.

Google is only as good as the info you type into the search box. The salesperson is only as good as his or her ability to find out the why behind the purchase. The smart salesperson, therefore, actively seeks out the why.

-Phil Wrzesinski

www.PhilsForum.com

PS To learn more about the power of WHY check out this TED Talk video by Simon Sinek

Is This Happening In Your Business?

My friend, Chris, had an interesting experience with a specialty retailer the other day. I’ll let him tell you in his own words…

I went for a long bike ride the other day and stopped at a bike shop I’d never been to before to buy a mirror. Asked a question, got an adequate (if cursory) answer, bought the mirror, and left to assemble it in their parking lot.

And as I did I thought: I am a new customer with a new bike, with more gear to buy, and they made ZERO effort to get to know me. No questions about my bike, or where I was going on it, where I was from, nothing.

Yet, I heard a radio ad for them yesterday. …they will invest money in an ad but will not invest two or three minutes getting to know me. It makes no sense, and speaks to an enormous lack of curiosity, a laziness, that plagues our age.

And here’s the thing: they sell commodities. Even their nicest bikes and gear can be found elsewhere, in other shops or online. The only thing they can do to become something more than commodity brokers is, as Seth put it, to be more human.

Why won’t they do that?



Chris tried to answer his own question with the thought that maybe they didn’t want to put forth the effort for somebody they didn’t believe would ever be back in the store. Or maybe they didn’t want to put the effort into educating the customer only to have that customer take the info and go online to save a few bucks.

Are our customers training us to give poor customer service for fear if they get good information they might never come back?

My response to Chris was that education is the bond that brings customers back because they will have more questions. If you answer their questions well the first time they will be back the next time.

About 50% of the retail customers in any category shop based on trust first, then price and all that other stuff next. The other 50% shop first on price. And every person has categories where trust is our number one decision maker and categories where price is our number one factor.

People talk about the Internet as being this vast wealth of information. And it is. What people need, however, is a guide to sort through that info and pull out only what is relevant.

In retail that relates to not just knowing your product info (features & benefits) but understanding your customers so well that you consistently find the benefit that makes the most sense to them. That is how you earn their trust.

Sure, some of your customers will be price-first. But some will be trust-first. And you never know which is which. So try to earn trust with ALL of your customers and consider that 50% of them will simply be training fodder to help you be better so that you can win the hearts (and pocketbooks) of the other 50%.

-Phil Wrzesinski

http://www.philsforum.com/

PS To understand more about how Trust and Price play a role in customer buying habits, read this post.

What if They Stay?

Most retailers know that we have to train our staff. The question is often how much should we invest in this process?

The answer is Everything You Can!

You can have the best product selection in the world at the best prices, but if your staff cannot lead the customer to those products and match the customer to the right product, all you have are full shelves (for which you don’t have the money to pay).

You can have the most fun displays and activities in your store, but if your staff is a real downer no one will be having a good time.

You can be the highest-tech, energy-savingest, greenest store on the planet but if your staff is texting their friends instead of greeting the customers, you’re still just wasting valuable space and resources.

Your staff is the make-or-break difference in the profitability of your store. They either point customers to products and get out of the way or they create meaningful, lasting relationships that make your customers bring you more customers.

Roy Williams was once asked “But what if I train them so well they leave?” His response was, “What if you don’t train them and they stay?”

The fourth quarter is right around the corner. Now is the time to start training, and training, and training, and training.

Rule of thumb… If you can do more training, then you haven’t done enough.

-Phil Wrzesinski

http://www.philsforum.com/

PS Don’t know how to train? I laid it all out in an easy-to-understand format in the eBook Staff Meetings Everyone Wants to Attend. Be sure to also download the one-page worksheet I use for planning fun, informative and effective meetings.

PPS Don’t know what to train? Check out my latest eBook Customer Service: From Weak to WOW! If that doesn’t at least spur on some interesting conversations, I’ll be surprised.

Four Steps to a Killer Radio Ad Campaign

You’ve tried radio advertising. Bought some package the sale rep offered. Ran a few ads that sounded “professional” and got little return out of it.

That’s because you didn’t do it my way.*

Here are the four steps to running a Killer radio ad campaign.

  1. Figure out your core values.

  2. Pick one core value that will have the deepest connection with your customers (and one that your competitors most likely don’t have).

  3. Write a killer emotional ad that touches on that core value.

  4. Keep the ad running changing only the copy, not the core value, now through Christmas.

Core Values

These are the values both you and your business hold dear. Values that you will never change. Values so strong that you would rather close up shop than change them.

My store’s core values are Fun, Helpful, Educational, and Nostalgic. Ask me to drop any of those and it is a deal killer. If you are struggling to figure out your core values, download my free eBook Understanding Your Brand and the accompanying worksheets.

Deep Connection

Believe it or not but it isn’t income, education or marital status that drives loyal customers into your store. Your best customers are there because they share the same values or belief system that you do. Those shared values are the bond between you.

The deeper that connection, the stronger the bond.

When you pick a value to use for your marketing, either pick the one that is the most emotional or the one that is least likely to be found in your competitors.

For example, as a toy store, one of my values is Fun. But all of my competitors also have some claim on the concept of Fun because we all sell toys. Nostalgia, however, runs much deeper and more emotional. Education is a missing component in the big box competitors, and Helpful has never been their strong suit either. So I tend to focus on those values in my ads.

Killer Emotional Ads

Remember that the goal of your ad is to move someone to action. That someone is the person who shares your values. Write an ad directly at her heart. Speak to her and only to her. Speak about her values and how you understand them. Speak to her concerns, needs, and beliefs.

Forget about everyone else who might be hearing your ad and just write it to that one person. You will be amazed at how many of those “one persons” there are out there.

Killer emotional ads do not sound like any other ad on the radio. That is good! No one likes ads so we tune out anything that remotely sounds like an ad. Here is an example of a killer emotional ad…

He left Detroit 9am Christmas Eve… Someone somewhere had to have the one toy his sweet little six-year old wanted. Six cities…seven stores later, he stood, travel-weary, across the counter from me. “I suppose you don’t have any Simon games either.” As I handed over the last of our Simon games he smiled and said, “God Bless You!” Believe me, He already has. Merry Christmas from the Toy House in downtown Jackson. We’re here to make you smile.

Keep it Going

Radio advertising is not a sprint. It is a long distance run. If you want this campaign to give you great fourth quarter results, you have to start running now.

At the same time, radio ads can get boring really quickly. One superbly written, emotionally-driven, killer ad can turn boring in only a matter of weeks. So you have to write a whole bunch of ads all around the same value. Figure out how to say the same thing five different ways and you have the makings of a killer campaign.

There are eighteen weeks until Christmas. Five ads all about your strongest core value running three to four weeks each will connect you powerfully to your best customers and get them to choose you over your competitors this fall.

Killer.

-Phil Wrzesinski

www.PhilsForum.com

*PS My way is really Roy’s way, as in Roy H. Williams, aka The Wizard of Ads. He taught me. I did it. I saw the results.

PPS For more on how to use radio the right way, check out this post I wrote in 2009.