Changing what a store sells
Looking for new products and services
Dorothy uttered those famous
words many years ago in the movie, "The Wizard of Oz".
The scene was one where Dorothy was looking about at the landscape
and deciding that she and her dog, Toto, were not in the Kansas
that she knew.
Perhaps, that type of scenario
could also be played out today in our hardware stores. If we had
closed our eyes some twenty or thirty years ago, and were to open
them in the summer of 1997, few of us would recognize our own hardware stores.
One
of the hardware adages is that if a store were completely and
freshly stocked, and then closed its' doors for seven years, then
the store would have 40% of the stock outdated when it reopened.
We might agree that the majority
of our inventory would be different - fiberglass handle tools, sophistication
of the latex paints, pvc in plumbing and electrical, and the various
chemicals - added and deleted to the lawn and garden departments,
just to name a few of the changes in the past twenty years.
There
are also a number of changes that have affected the physical layout
of our store. Remember when in the early 1980's, the loop became
the newest idea in store design? Then, we went to the power aisle.
There have also been many changes that show up in regards to staffing,
hours, advertising, cash registers, and services offered.
Some
stores, and they appear to be few, have remained as hardware purists.
It would probably be a safe assumption that those that have been
able to remain as purists in the face of competition, are even
fewer.
Those that have made the change
have done so in many various ways. There is the story of the hardware
dealer in Australia that, when faced with new competition, decided
to staff his store with women - all topless. One of the reports
stated that this store had a sales increase of 700%. Most of us
would agree that this retailer is no longer a hardware dealer.
There
is also a recent report of a hardware store operated in the United
States by a woman, who has staffed her store entirely with women.
The article went on to state that "suggestive or tight fitting" clothing
worn by her staff, met with her approval.
Looking past these
two examples that have appeared in the trade press, let's take
a further look at the mainstream of the stores today.
During
the first six years of the 90's, we found that our store became
more than a hardware store. We had to. We first became a fax and
copy center. Our fax machine was placed under the counter at the
front check out area, and our copy machine was placed at the rear
of the store. To achieve add on sales from copies, our register
receipt printed a coupon for a 50 cent discount on each $10 purchase.
When the coupons began to show up on a regular basis, and neighborhood
business people printed our fax number on their business cards,
we knew we had a success. By the Christmas season of 1996, we added
a full service post office that was open all of the hours that our
store was open. The post office was even located in what
had been a storage closet.
We created a drop off point
for vacuum and sewing machine repair. A customer that owned a vacuum
and sewing machine shop decided to retire and close his store. But
in retirement, he wanted to keep busy. A new service was created.
Bicycles were next. When the
bicycle shop in our shopping center moved, we added that department,
including repairs also done by
a customer.
One of the most unique was our
addition of cookies and coffee. The uniqueness was that the cookies
were baked in our store using an air oven. The fresh aroma of baked
cookies and brewing coffee was much more pleasant than the smell of lawn
chemicals.
From an community and ecological
standpoint, we added oil recycling and fluorescent bulb recycling.
Although neither produced much in revenue, they did show to our
community that we were active, concerned, and on the leading edge
of products and services.
Truck rental and United Parcel
Service were two that were added by eliminating our warehouse space.
With truck rental gross income projected to be over $250,000 within
three years, surely this made the warehouse more profitable. For
each of the first four years of our parcel shipping, we showed a
double digit increase over the previous year, and with a handsome
profit.
There are several others that
we looked at, that were done by other stores that we did not add:
grandfather clocks, hot tubs, fine china collectibles, pager and
cellular phone sales. The store that had the pager and cellular
phone sales reported that their profit from this unique sales niche
was in excess of $50,000 per year.
With each of the stores that
we asked why they added a new area, the answer always came back
to the need to have product areas that were not carried by the mass
merchants or warehouse stores, as well as to minimize the number
of areas in their store where they were forced to have single digit
margins.
With falling margins, or situations
where a warehouse store or mass merchant had developed an overwhelming
product selection, the dealers made these choices of deleting products
and services in their effort to continue to maintain margins. Some
of the most frequently dropped departments were lawn mowers, ceiling
fans, water heaters, and light fixtures.
"Looking for the electrical tape, m'am?
Let me take you there. It is just past the clothing and deli departments.
I will be glad to help you" No, Toto. This sure isn't like
the hardware store used to look.