Small business promotion with retail speaker Tom Shay
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Jeff, Jerry and David

The changing landscape of business

Once upon a time there were three businesses owned by local families. All of the businesses were in the same community but did not compete with each other because of their locations and product mix. There were several things they shared in common. All had been started about the same time.

The three businesses enjoyed their best years at a point in time when neighborhood businesses were at their best and mass merchants were only coming onto the retail scene. The businesses were all known by many people within the community and drew their customers from areas that were larger than most similar stores. One of the biggest challenges each faced was what to do when the mass merchants were enlarging their realm of influence. While each of the three businesses enjoyed growth for many years, none of the three looked about the community to see the changing landscape of retail.

All were started by couples that later brought their children into the business. The second generation did not enjoy the same success their parents had and eventually closed their family businesses. The second generation owners, Jeff, Jerry and David,  demonstrated the same great personal skills with customers and vendors that their parents had shown over the years. The second generation members each worked hard and many hours each week within the business. Why did they fail?

One observation that could be made of Jeff, Jerry and David was that perhaps they spent too many hours within their businesses. None of the three made any effort to visit the competition; be it other independents or mass merchants. They had little or no idea of what the competition was doing.

It could be said that David had the best clue given to him about visiting the competition. When being interviewed by a newspaper about the closing of the business, David said, “We always take good care of our customers. Our customers say that if they can’t find it anywhere else, they know they can find it in our store”.

Unfortunately David took this as a compliment from his customers. David never stopped to wonder, or investigate, why the customers were choosing to do their first shopping in another business and coming to his business as a ‘last resort’. The hint was there from the customers; David just was not hearing it.

Jerry observed that his part of retailing was changing. His father operated the business in a time where customers would buy something and then call to have it serviced or repaired as necessary. Over the years, the type of products they sold required less and less repair; many customers simply discarded a product instead of repairing it. The business was also challenged by mass merchants that sold similar products at lower prices.

They simply kept the doors open and took a beating in sales and profit until the point where all of their reserve money had been spent. Jerry closed the business and took a job working for another independent business where selling products and providing service and repair was still an option.

The story of Jeff and his family business was such that they never quite seemed to be into the idea of operating a retail business. Pulling into a parking space in front of their business, you always recognized a couple of cars near the front door; they were the vehicles of Jeff and his father. Customers had to walk past their cars just to get in the front door.

The floors were always dirty; dust was everywhere; ceiling panels were missing; and you could always expect to see at least a quarter of all the lights not being turned on when you walked in their business.

Three short stories of three families and their businesses. All three examples could be in any town; at least one of them is likely to be a part of every town. Each of them, Jeff, Jerry and David, were the second generation in a family business. We could anticipate they would have an advantage over many others because of their being around a parent that had many years of front line and retail management experience. Research has shown that coming from the entrepreneurial background accounts for up to 40% of the success of those that make a ‘go’ of a small business.

Each of these three appear to suffer from the ‘do as we have always done it’ syndrome. This is an illness that can affect individuals and businesses. Just like a doctor asks questions of a patient and their symptoms, let’s ask some questions to see if we have a patient/business with a problem.

When was the last time the business gave the interior a new look? How about determining the customer base? Has the business engaged in research to determine who the customers are, where they live, and learned more about their spending habits? The result of this will be a business that has more products and services that are targeting the right customer.

When was the last time the retailer exposed themselves to components of education? Perhaps the easiest form of education comes from reading business oriented books. Another aspect of education is that of attending live events. The small business owner should be attending the trade shows, conferences, and continuing education events that are geared toward their specific trade.

Our communities have enough representation of Jerry, Jeff and David; we don’t need to create any more. We do need to do plenty to stop us from having any more. They are not helping our communities.

Tom Shay is a fourth generation small business owner providing proven management and business building ideas through his Profits Plus Seminars, Profits Plus Solutions coaching, books authored, and articles written. Tom can be reached at 727-464-2182 or through his web site:

Profits Plus Solutions, Inc.
PO Box 1577
St. Petersburg, Fl 33731
(727) 464-2182
Fax: (727) 898-3179