Retailer Shuts Shop – Why Retailers Fail


I was sad to read a story in my local newspaper, North Shore Times about a Glenfield hardware store McPherson’s Hammer Hardware, which is going to close in a couple of months. Firstly I as going to share a link with you, but the aforementioned newspaper has a system that requires you sign up to their digital version if you want to share a story, and likewise, probably if you want to read from a link. I do not provide links for my readers to sites like that.

I used to live in Glenfield and visit this story and I remember asking them how they stay in business. The owner, John MacPherson told me it was about community, having those little things that the big stores make you buy in bulk, advice on how to do things, friendly service, remembering people’s names, the little things that come with community retail.

The newspaper story goes on to quote that he has probably hasn’t been making a profit for 6-7 years, but hung in there. He points out that the DIY super-stores and Internet have changed the game and that even the major stores/chains suffer from sluggish consumer spending.

He’s not wrong, but the key word is change. I love the world of retail, I used to have the privilege go to the NRF in New York and FMI Connect in Chicago and bring back ideas to write about in retail magazines, share with my resellers and speak about at conferences around the world. This was important because many of our retailers couldn’t afford to go to those conferences, but learning new ideas, particularly from people who have proven experience, is how business evolves.

It doesn’t really matter what business you are in, you have to evolve to meet the demands and opportunities presented as society evolves. As John said in the North Shore Times article, “In Glenfield we had a haberdashery (incorrectly spelled in the newspaper, I had to look it up to find out what it was), greengrocer, butcher, it was a great mix”. It went on to say they were boom times.

So here’s the thing, it is still boom times for those businesses that want to keep up with the times. The problem that retailers used to tell me was that they didn’t have time to keep up with the times. They were too busy starting early in the morning cleaning the shop, doing stock takes, placing and chasing orders, talking to merchandising reps, ringing customers to say their widget had arrived, preparing the float and a myriad of other things. In hindsight, those retailers, from John McPherson’s Hammer Hardware in Glenfield, through to Borders and other retailers should have found the time to look at how some businesses were thriving, while others weren’t.

When they went on their holidays, they could have combined them with visits to businesses and conferences that showed how some retailers were managing in the new world of mobile and tablet, of connected customers. They could have seen new products that aren’t available in NZ, they could have combined bricks and mortar with online themselves. I appreciate how hard it is to run a business, I have run several businesses over the years and worked in companies from small to multinational and the common thread is that those who looked ahead continue to do well, those who looked to their original training and just repeated what they had learned, which may have been best practice in the 70’s or whenever, will have done well for a while, but aren’t there any more.

People still want to have experiential retail, they still want to see and touch, ask questions, they even want to see people like John McPherson stick around and stay in business, but they can’t advise him on what to do to stay in business and get back into the black.It’s tough, but the time to get ahead in business is when you are ahead and you have the resources to go and do some training, bring in a consultant, go attend a conference. I used to speak regularly at retail conferences in New Zealand and what was really frustrating was that the people attending were those that needed it the least, because they were looking ahead and staying up with the times. The ones that needed it the most didn’t go, probably didn’t read the specialist trade magazines, ask their suppliers for knowledge or go to the trade shows. They were too busy. Now they are either out of business or heading out. Is it too late, not necessarily, but it will be much harder, even to change the mindset. When things get tough, many go even farther back into doing what they used to do, even doing it harder. That’s not the answer.

Back when business was booming for people like John McPherson, Bob Dylan was singing The Times They are a Changing. He was so right. “You better start swimming or you’ll sink like a stone.” Listen to the lyrics, they are prophetic. But this is no different to 200 year ago. The times are always changing.

We are still buying all the things we used to buy and more. Some business models have been and gone, but others are growing in a big way. We are still a DIY country, that’s why we have the mega stores, but there is still room for specialists, room to be a community and have community involvement in business, there are so many opportunities. Whether it is classes at the back of the store teaching people how to do things, or a new section selling 3D printers and teaching kids how to make things, using location based mobile services to find people who are looking for what you have, supplementing your business by selling items you can’t afford to stock, online.

I’ll finish with a question. Why is it that I can buy a set of my favorite guitar strings online from a retailer in the USA, 75% cheaper than the same product in New Zealand? The local retailer will say that’s because the guy in the USA doesn’t have a shop to run. But the fact is they do, Elderly Instruments has a bricks and mortar store in Lansing, Michigan, they have bands playing in it, they have workshops for musicians, they just supplement that with online sales. I recently contacted them because I couldn’t get help from local retailers to fix a broken part on my Dobro. I had personal emails, just the same service that John provides in his hardware store and I’ve managed to repair it myself with the parts they sold me. Doing business with them was so easy. If I lived in Michigan, I would go and by from their store and I’d even be prepared to pay a little more, heck I’d buy more anyway just because I like doing business with them and they like what they do and know what they are talking about.

So I’ll finish on a saying that is one that has killed many a good retail business. “If it ain’t broke, don’t fix it.” Have a look around you right now and ask yourself how many of the things you take for granted would be there if everyone had said that back in 1970, let alone 1870?

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One thought on “Retailer Shuts Shop – Why Retailers Fail

  1. Pingback: Kindle Buyers at Dick Smith Beware if You Want to Read Library Books | Luigicappel's Weblog

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