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Analogies, Ideas and Making Money

Learning through the mistakes of another

The newspaper article told the story of a small business in a medium size city. The size of the article would equate to an ad that few stores could afford to buy. It actually covered the majority of one page, and a good part of another. However, it was not the type of article that any store would like to have written about it. This article told of the closing of the store.

The article was interviewing the young man about the history of the store, and his thoughts as to why the store was closing. The current owner of the store was the son of one of the two founding partners. He had been the owner for only a few short years. His father had bought out the partner when the partner was ready to retire. The partner had no children that were interested in the business, so it was the logical choice for the one who had a son working in the business to become the sole owner.

The store was somewhat of an institution within the city for it was the only one of its kind for many years. While there were other stores within the city, this store had the most complete inventory, and a sales staff that was second to none; knowledgeable and friendly people. Customers walked out with what they needed as compared to many stores that allowed customers to settle for what they wanted.

But as happens in many areas of retail, the chain stores had arrived. These chain stores were not located on Main Street as was this business. As you might expect, the chain store did not have a staff that would compare to the smaller store. And, there were all the products that only the smaller store stocked; items that the smaller store staff was known to have used and could demonstrate to the customers.

Of course, the chain stores were much bigger, did a lot of advertising, and as compared to the smaller store were open on Sundays and evenings. The chain stores had neat displays, with banners and signs hanging from the ceiling.

Going back to the article, there was a quote from the young owner about competition. He explained that he had taken very good care of the customers for many years, as had his father and his partner during the time they had owned the store. He thought he would be able to carry on their tradition after they retired and operate a business that took good care of a certain segment of the community. But there came a point where he noticed that something had happened. The occasional decline in sales had really turned into a downward spiral.

He stated that he had lost too many customers to the chain stores. The competition had arrived and made a place for themselves. "When the horse is out of the barn, it is too late to shut the barn door", or so the old saying goes. The young owner was also quoted as saying that he had shopped the chain store and lowered his prices to compete. He even thought that he had better prices. Unfortunately, the perception of this soon to be former business owner is that the new competition had made a place in the community by promoting their prices. And to think that the chain store has lower prices on everything is a quick way to become an unprofitable store.

For this situation, the analogy is, "When the bear gets into the water to fight the alligator, the alligator usually wins the battle." And in this case, the old institution of a business is closing.

The last analogy that we offer is, "You do not achieve success by doing one thing 100 percent better. You achieve success by doing 100 things one percent better." The question that usually follows is to ask what are the 100 things that you need to do better. And the real answer is that there are hundreds of things that you can do. You don't have to invent all of them, or even very many of them. You do not have to be the most creative merchant in regards to merchandising and promoting.

You will find that there are many ways to find these ideas of which the three easiest to access are trade magazines, other retailers, and books. While this magazine is tailored to the specific needs of those selling shooting sport supplies, there are also a number of magazines from other industries that have great management tips that can be adapted to your situation.  (Many of these magazines offer 'no charge' subscriptions to retailers. Look for these cards in their magazines.) The best way to find these magazines is to visit with other retailers and offer to exchange some copies of the magazines you read with them.

In addition to trading some of the magazines that you receive with the other retailer, you will probably see a couple of ideas in their store that can be applied in your store. Offer to take the retailer out for a cup of coffee and ask what business ideas they have tried. (Find an accountant that shops in your store. Take him to coffee, and ask the same question. Taking him to coffee means that you probably won't pay for an office visit.) It doesn't matter whether or not the idea was a success for the other merchant because their failure may be your success.

Make a point to carry pen and paper with you whenever you travel. You'll be sure to get ideas whenever you go in stores. (Are their front windows clean, are they covered with outdated posters for community events?)

If you watch the experiences that shoppers have in other stores, you can sometimes gain ideas from their bad experience that will assist you in doing something special for your customers when they shop in your store. (When was the last time you saw a customer service policy that was designed to assist the customer and wasn't just a rule that the store created for their own benefit?)

As for books, the topics will usually fall into one of two categories:  management or positive mental attitude. You will find a large selection of both types at a library, (Sure, you can go to a book store, but you have to pay for the books there.) But be cautious in your selection of reading material.  Retailers, like most other people, have difficulty in getting to find the time to sit down and read. Over 60% of the books purchased are never read. Going to the book store and selecting three or four books will probably do little more than help to empty your wallet.

Select one book, and try to read three or four pages while you are standing there. If the book can't hold your attention for this long, it will probably only collect dust on your desk. When you find the type of book you like, read it and then return for another.

Whether it is from adapting an analogy or an idea, finding ways to make more money in your business is like a lot of other things in life; not easy, but often simple.

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This article is copyrighted by Tom Shay and Profits Plus Solutions, who can be reached at: PO Box 1577, St. Petersburg, Fl. 33731. Phone 727-464-2182. It may be printed for an individual to read, but not duplicated or distributed without expressed written consent of the copyright owner.

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