The independent retailer lives on

Jun 27, 2016

Through a special arrangement, what follows is a summary of an article from Retail Paradox, RSR Research’s weekly analysis on emerging issues facing retailers, presented here for discussion.

One undercurrent I felt very strongly at the recent Internet Retailer Conference and Exhibition (IRCE) in Chicago was the presence and predicament of the small, independent retailer.

Sure, some of the technology providers there could scale up to tier one and tier two proportions, but a notable focus was on the small retailer as well — rightfully, and necessarily so. While technology has changed and evolved, the independent retailer — even without storefronts — still works far more than the 40-hour week (or even 50-hour week) of his larger brethren.

As the daughter of an independent retailer, I saw my father get postcards pre-printed when he’d run a sale. He would address them by hand and I would fill in the zip code on the front. We’d mail them to all his existing customers, whose names he gathered by hand from sales receipts. Today, all kinds of e-mail programs can send targeted (and all-too-often untargeted) e-mails with the offer of the day. If you buy online, the retailer automatically gets your name, address and e-mail. Challenges now are more about having a single customer list for all the channels where business is conducted.

While my father would also run small ROP (run of paper) ads in local newspapers from time-to-time in hopes of attracting new shoppers, the independent internet retailer focuses on search engine optimization (SEO). I have a client who built a business from zero to a $300,000/year run rate in eighteen months by spending 70-80 hours a week working on Search Engine Optimization (SEO). That’s right, 70-80 hours of his own time to go along with the money he spent on SEO providers.

The long and the short of it is that the independent retailer still works really, really hard. Sure, some challenges have been solved by technology. But those same technologies create shiny new challenges that require hours of work, thought and effort. I, for one, appreciate their efforts and make every attempt I can to support them whenever possible. I hope you will too!

DISCUSSION QUESTIONS: How have you seen independents take advantage of retail technology to undercut the advantages of their larger chain rivals? What other advantages do independents have that big chains fail to match, even with technology?

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"Independents have an advantage over most of their bigger brethren -- they are in close and personal touch with their customers."

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13 Comments on "The independent retailer lives on"

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Bob Amster

Certainly the nature of many technology offerings today, along with their attractive pay-as-you-go and pay-for-use pricing structures, make it possible for independents to have access to sophisticated solutions that enable the independent to compete with larger retailers. But the independents have an advantage over most of their bigger brethren — they are in close and personal touch with their customers and they often have access to unusual (unique) items that are not available in mass-production quantities.

Gene Detroyer

… and they should see themselves as completely different business models. Despite what larger retailers say, they are not about person-to-person connections. Certainly not with 67 percent turnover at the brick-and-mortar level. The KPI for independents should be the antithesis of those large retailers. Measure person-to-person connections with the customers and the revenues will come.

Tony Orlando
Excellent subject, as this is my entire life. I watched and learned from my dad since the age of four, and back then we were “thee” place to shop, and my dad knew how to run a great store where custom meats, a strong perishables department and groceries displayed stacked to the ceiling kept the customers coming back for more. Wow have times changed, but there are still some old-fashioned values I learned that never go out of style, regardless of technological advances. Top-notch service with a smile is number one, as it is something my employees have seared into their brains when they are hired. I have been to many retail stores and, generally speaking, a well-run independent store owner provides better service than the big box stores by a wide margin. Many of the big box stores no longer have a meat cutter and we need to take advantage of this, and many stores do, but it goes beyond that for a store to succeed. We have worked hard on social media, with… Read more »
Ross Ely

Today’s technology, including e-commerce and loyalty systems, is easy-to-use, powerful and affordable even for independent retailers, who usually lack the in-house IT departments of their larger brethren. The leading independents are using this technology to match the capabilities of the largest chains.

In addition to being closer to their customers, independents also can move quickly in their adoption and deployment of new technology. They can experiment, test and fine-tune programs and be more nimble compared to the larger chains.

David Livingston
5 years 10 months ago

Not sure about technology. My dad was in independent grocery. He could kiss and hug customers, carry a gun and leave work to take vendors for a ride in his airplane. He was judge and jury for all shoplifters. I’d like to see a corporate chain store manager try that and keep his job.

Karen S. Herman

I see many independent retailers embracing social media and building their client list with Facebook, Pinterest, Twitter and YouTube. One of the advantages of being small is the lack of silos and bureaucracy that larger retailers have to contend with, and with social channels alone an independent can grow a loyal client base organically. Personal attention and dedicated service in-store follow right along. Great article, Paula. I’m with you in supporting independent retailers!

Mel Kleiman
5 years 10 months ago

The one major advantage the small retailer can have that the large retailer will never be able to duplicate is quality of customer service. The only caveat is that this requires the skill and ability to find, hire, and retain STAR employees. Something that, I am sorry to say, most small retailers have never mastered the skills necessary to do.

But those that have end up winning the war for customers.

Ralph Jacobson

Independent retailers are not always small organizations. That’s the first myth. Independents are some of the most innovative retailers in the market, and around the world, by the way. They tend to be far more agile and can respond to emerging trends immediately. Yet, other independents have some aversion to innovation. They feel it’s a risk to their organization. I think there are plenty of tools they can leverage to take small steps and make effective progress.

Ed Rosenbaum

When a subject such as this comes to us I anxiously wait to read Tony’s comments. Tony is an Independent in the battle that we are only observers to. Read what he tells us and you know he has the “scars” to prove it.

All of us whose parents were in the retail world, no matter the products, will never forget the long hard hours they put in on a seven day a week basis. All of us remember our parents knowing the customers by name and knew their families.

This is yesterday. Sadly, yesterday can’t come back as we knew it. But it has to come back in the sense of how customers want to be treated in order to bring them back. Why does this not happen in today’s retail world? Because the owners do not put in the time or training commitment to make it happen. In too many cases, “when the cat is away, the mice will play.”

Tony Orlando

Thanks Ed. My scars are earned, and proud of all of them. They are kind of like a business tattoo.

Jeff Hall

In our Ann Arbor market, we have a very strong ecosystem of independent retailers. More than utilizing technology, these brands excel at relationship-building, recognizing and appreciating their customers, supporting the local community, staying visible on social media and offering unique in-store experiences. These are the qualities consumers crave — a personalized shopping or dining experience and interacting with genuine, authentic business owners.

Brian Numainville

Independent retailers can focus on service as an advantage, they can be more agile without the red tape and layers of approvals needed to implement things like social media and new technology, and they often are deeply woven into the fabric of the communities that they serve. As far as technology, there are consortiums like the Center for Advancing Technology (CART) that can help them achieve the benefits of scale of larger organizations while doing what they do best in serving the customers.

Joan Treistman

An independent retailer once shared with me how he could foresee an economic downturn. We were at a conference where huge corporations were telling the audience about their sophisticated data bases and their ability to track and anticipate change.

The retailer was apologetic because he didn’t have the complex processes of the speakers. So I asked what information he used to forecast changes in the marketplace. And his insight was a huge “wow” for me. It was simple. He told me that when he noticed that in his store “Haagen Dazs” ice cream sales went down he knew there was an economic downturn that would affect his revenue overall.

And it didn’t take him long to figure it out. I think that’s another real advantage of independents. They live, feel and touch their business every day and are able to see signposts that others in larger corporations might easily miss or see too late to properly deal with.

"Independents have an advantage over most of their bigger brethren -- they are in close and personal touch with their customers."

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