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If You Were to Close Your Business Tomorrow, Who Would Care?

In today’s competitive business landscape, we must be customer focused. It doesn’t matter what you sell; if you know how to build relationships then you will be a success at any business. Ask yourself the following questions:

• What else can you do to build a long-term relationship with your customer?
• How much do you know about your customer?
• Do your employees call the customer by their first name? How much information do you have about the customer?
• Do you have a system in place that can help you collect information about your customers?
• Do you know what your customer’s preferences are and what you could say on a phone call that would have them stop by the store as soon as they could?
• Do your customers tell you that they love shopping in your store?

If they do, then that comes from their hearts. If they tell you that they love your prices, that comes from their head and be careful there. You don’t want customers loyal to just price because when someone cheaper comes along, they will switch their loyalty in a matter of seconds. Become the expert in your field. Become a resource, not just another store. That is the perfect segue to my second question.

Where would your customers go if your business closed? The more stores or businesses you mention, the more you need to rethink who you are. If customers can easily find what you sell or service at many different outlets, then it’s time for you to sit down and start listing what makes you different, unique, and the reasons someone should shop with you. I closed my store eleven years ago, and to this day, I can’t go anywhere within my store’s marketing area without someone telling me how much they loved my store and how much they miss it. Then they go on to explain why. They would start with the words, “You carried the best that was perfect for me”. Or, “You always knew what I needed or wanted”. Or, “I miss Tiny, or Sadie, Ruthie or Margie”. I had spent thousands over the years to collect data about my customers that predicted their buying patterns. I always had a promotable item on display, markdown sections, and a constant assortment of various price promotions. But I also noticed that rarely does anyone ever mention price.

If you’re wondering why I closed the store that I worked at for 25 years and that was a 58 year old family business, here’s the short story explanation. It’s simple. I started speaking in 1991. By 1995 my speaking schedule hit 100+ engagements a year. I worked in the store with my wife who started helping me coordinate all of the bookings. In short, Mom and Pop were not running the Mom and Pop business. So we decided to sell it. Unfortunately, the offers to buy the business were many but the prices didn’t make any sense, compared to running a store closing sale. The bottom line return was over 7 to one plus most prospective buyers also wanted me to stay there for between 1 and 2 years, which was impossible.

Customers were upset because of the relationships we had built. We kept on hearing the same question over and over, “Where are we going to go now?” We could not be compared to any other single store. The reasons are the key to successful retailing.

1. Unique products and unique specialties. Our merchandise had to be different and not found at the mall.

2. Service that was unparalleled to any other retailer. We employed 6 dressmakers that insured perfect fits. On a Saturday we would have 4 dressmakers working without any work scheduled for the day. Most of the day, all four dressmakers worked on rush jobs for that night or the next day.

3. Longevity of our staff. The majority of our staff had worked at the store for more than 10 years, and many over 20. We also had longevity of customers as well.

4. We knew our customers very well. We collected data, preferences, sales information, and even customers’ birthdays so that we could send a birthday card and a coupon for the store on their birthday. We knew who our customer was, what they liked, when they liked to shop, and how much they wanted to spend.

Those 4 rules should be universal for all specialty retailers. Many of you have also been in business a long time and have your list of reasons why you have been so successful. Stay focused on this list, and keep adding to it!

Editorial provided by Rick Segel, CSP, a seasoned retailer of 25 years, owned one of New England’s most successful independent woman’s specialty stores. He is the marketing expert for Staples.com, a contributing writer for numerous national publications, and a founding member of the Retail Advisory Council for Johnson & Wales University. Rick is the Director of Retail Training for the Retailers Association of Massachusetts. He is the creator of the Retailers Association of Massachusetts Awards of Excellence Program (RAMAEs). Learn more at www.ricksegel.com