Posts Tagged : Jon Schallert

the Hartville Hardware Store: The World's Largest Hardware store
Retail Isn’t Dying & the Retail Apocalypse Isn’t Coming

In the last 2 months, there have been multiple articles written about the “Retail Apocalypse”, the term journalists use to describe the many retail stores and malls that are closing.

One article in Bloomberg magazine by Matt Townsend and others was titled: “America’s ‘Retail Apocalyse’ Is Really Just Beginning”.  The article detailed the debt that major chains are carrying and the history of chains going out of business.

My favorite article was written by Bart Higgins in the Wall Street Journal that showed the Rolling Acres Mall in Akron, Ohio with the headline “What to Do with Dead Malls?” Bart wrote: “Brick-and-mortar stores are closing at unprecedented rates”.  To drive home the point, the WSJ used a photo of the mall at center court showing boarded-up stores, dying trees in the planters, and broken lights and tiles dangling from the ceiling.

All of these articles sure make it sound like the end is near for retail.

But nothing could be further from the truth.  What we’re witnessing is not the end of retailing. We’re witnessing the results of years of rapid retail growth of copycat stores who thought the way to grow profits was to add more locations, adding their stores to developer-created clusters of additional copycat stores in any city or county that seemed viable.

What we’re really witnessing is retail reinvention in a massive way. And the winners will be those proactive retailers that make themselves true Destinations for consumers, complete with one-of-a-kind product, services, experiences and surprises.  These retailers will continue to grow and thrive, despite any competition that comes from Amazon and other online retailers.

Want an example?  Look a mere 17.2 miles away from where the Rolling Acres Mall in Akron stands as a wreck of its former self and you can find the Hartville Hardware store, the world’s largest hardware store at 305,000 square feet, thriving in a city of 3,020 people.

What?  The world’s largest hardware store profitably exists in a city of 3,020?  Yes!  And though this store is unusual because of its size, there are hundreds of Destination retailers in North America whose locations are even more demographically-challenged, not nearly as large, with often lower populations, that are attracting both local customers and shoppers from miles away.

All of these stores are living proof that Consumer Destinations are avoiding an Apolcalypse and proof that as Destination retail thrives, so can small towns and urban areas prosper when a developer would never have considered their marketplaces viable for a mall of any kind.

So, when you hear someone say that “retail is tough”, remind them that it’s never been an easy vocation, and when someone says that Amazon is going to kill all retail stores, just smile and walk away because retail isn’t dying. It’s simply morphing. And those smaller communities, savvy developers, proactive downtowns, and retail entrepreneurs who recognize that ‘location, location, location’ is no longer the key to retail success will be the true beneficiaries of this retail shift.

That’s it for this post. Feel free to call if you’d like to talk more about your business becoming the most powerful version of itself, a Destination Business.

Jon Schallert
President, The Schallert Group, Inc.
(303) 774-6522

Something to Smile About: There’s Retail Opportunity Here

Several years back, I did the keynote speech for an economic development conference on my Destination Business principles.

When I was done, the next presenter got up and it was obvious he wanted to show that he was a well-traveled expert.  To illustrate this, he began by flashing up on the screen photographs he’d taken of small businesses that he found particularly amusing.

Most of the photographs were similar to what I have posted on this page, a small business that combined two or more products or services under one roof that you’d never expect to be together.  Now, to be fair, he didn’t flash the photo I have here of the quilt shop/liquor store, but he did show similar examples of unexpected combinations of products in the same business.

With each photo, the audience laughed, as he poked fun at the businesses being shown on the screen.

And all I could do was sit there thinking: “This guy’s totally missed the point!”

I’ve spoken in hundreds of cities and small towns, and I’ve never been to, nor seen the quilt shop/liquor store shown here. Someone sent me this picture.  And just to be clear, I’m not making fun of this business.  Actually, there’s brilliance in this business.

You see, in the world of retail development, this quilt shop/liquor store is called a “multi-focus business”, meaning that it has two or more unique business models operating under one roof.

So when I find a business like this that has an unusual combination of products in it, I know it’s often because it takes multiple product lines (often diverse ones), combined together, to generate enough revenue for a business in a small town to actually make money.  I also know that smart business owners try to meet the needs of local customers, while also trying to grow their revenue, while identifying consumer demand, hopefully discovering and capitalizing on unsatisfied niche categories to produce a greater return-on-investment.  (Basically, I’ve just described the fundamental rules of the most successful businesses.)

Plus, most independently-owned businesses in a smaller marketplace can’t operate like a retail store on Rodeo Drive in Beverly Hills.  They don’t have millionaire customers walking in everyday and they aren’t located in a retail district that pulls customers from around the world.

Finally, when I talk to community leaders who complain that recruiting retail businesses is difficult, I point out that a multi-focused business is the first thing to look for.  This is because it’s always easier to grow an existing retailer in a community who’s already there, who already understands the marketplace and who’s already committed to the area.  Yet you’d be surprised how many retail development professionals look first to import a new business or poach one from a nearby community.

Personally, when I see multi-focused business, I start thinking: “How can we maximize this business into a stronger Destination, or even two separate Destinations?”

So remember: If you’re ever at an economic development conference and someone gets up and starts showing photos like this one, it’s OK to chuckle.

Just realize that inside that business, a creative, risk-taking entrepreneur came up with something that no one has ever seen.

And that looks like untapped opportunity to me.

A New Attitude Beats a Positive Attitude

You’ve probably heard motivational speakers talk about the need to have a positive attitude.

With all due respect to Norman Vincent Peale, a positive attitude for independent business owners isn’t enough.

Today’s entrepreneurs need a New Attitude.

When business owners tell me they are dissatisfied with their business performance and they want more customer traffic and higher sales, I tell them this:

When you step into your business this morning, take a look around and realize that the business you occupy is entirely your own creation. Sure, maybe someone passed it down to you through the family, or you bought someone else’s business, or you’re running a franchise that has limits not of your own design, but the bottom line is:  The business that surrounds you is what you’ve built, with your money, hard work, and vision.

You, as the owner, are the only one capable of changing your business in any significant way, and it begins with singular NEW moments of vision. These moments will only happen if you are willing to question what you have in front of you, and come up with something better. Something totally NEW.

As the owner, you cannot focus on all the reasons you feel your business hasn’t succeeded. You must focus on what you can control. It might be absolutely true that your city isn’t as business friendly as somewhere else, or that your Mayor has never spent a dime in your business, or that your downtown doesn’t have the parking garage that you feel it should have.  But you must ignore these things!  You are going to focus on what you can do right now that will increase your business performance and you are going to quit focusing your energy on areas that are out of your control. Doing so is a waste of time, and when a business needs help, time is a critical commodity.

Let me take a step back for those of you reading this who don’t know me:  For the last 12 years, I’ve conducted a Destination Business BootCamp where business owners spend over two straight days with me, learning techniques to reinvent their businesses. And while the owners in that BootCamp class are as diverse a group as you’ll ever find sitting together for two days, there are two things these owners have in common:

#1: A willingness to learn, and

#2: A nagging dissatisfaction with their businesses.

And #2 is critical:  For owners to move forward, they must reach a point of discontent where they want change to happen now, not sometime in the future.

If you’re a business owner, developing a NEW attitude is easy. Just look at those concrete components of your business that make you unhappy. Your store interior.  Your front windows.  Your advertising. Your marketing message.  Your website.  Your energy-sucking, waiting-to-be-told-what-to-do employees (I’ve heard some owners have these). You name it.  Look at these tangible components and decide how you would like them to be.  See them NEW and don’t compromise with your NEW vision.  Be demanding!  Be unreasonable!  Be unrealistic!  See it in your mind like you want it to be, and don’t settle for what you have.

Notice that I said look at those concrete components that you want to change.  Don’t look at your sales growth and say, “I’m dissatisfied with my business sales and I want more revenue.” Wrong!  Sales are a function of the concrete components you’ve created that aren’t operating effectively, and a reflection of the strategy you’re using to draw customers to you.

When owners change their components and change their strategy, guess what happens? Owners start walking in their doors every morning with a positive attitude.

But seeing your business NEW is the first key and this demands you bring some creative thinking to the table, taking a step back, and not settling for the business that’s in front of you.

You brought this business into the world. If you’re unhappy with the results, reimagine it as the business you’ve always wanted.

Coming to a Town Near You: Destination Business Mobile Office

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Coming to a community near you: the new Schallert Group Destination Business Mobile Office.

Now when you bring Jon Schallert to your town or city to help your business owners, Jon’s going to be bringing his entire office with him. This allows you to have access to all of Jon’s resources right in your town!

Look for this little powerhouse coming to your city in the future months!

Quit Worrying About the Size of Your Marketplace

When I consult in communities around the country, I often hear business owners say things like: “My marketplace is too small”, or “There aren’t enough of my type of customers around here to support my type of business”, or “When more people move here, my sales will improve.”

When I hear words like these, I realize that the owners I’m talking to have not embraced the idea that their business can become a Destination. Instead, they are running a business that is location-dependent.

The truth is that no one can accurately measure the financial potential of a community today, and where your business is currently located does not have to limit the sales your business generates.

As for measuring the potential of your demographic area, an accurate measurement of its potential cannot be done. Sure, I know that there are really smart people out there who can run demographic numbers that show the statistics of a marketplace. But the problem is these statistics then are correlated to the potential dollars that can be spent in that same area.

Unfortunately, these studies do not take into account the potential impact of a business that makes itself a Destination, a business that is so decidedly different that it consistently pulls consumers from outside its marketplace.  In fact, every analysis of every marketplace focuses on who is living there, not the potential spending power of everyone who could buy there.

Here’s why any analysis of a marketplace falls hopelessly short of the real potential of an area: Let’s start with every shopper who is walking around with a credit card, giving that customer exponential spending power. Do you accurately know the spending power of the customers who walk in your doors? You can guess, but you’d be wrong. Even in today’s economy, some of those credit cards are still tied to home mortgage lines-of-credit, and even though credit card spending has declined, some consumers still have gargantuan impulse- buying power.

Then, there are the tourists, who also carry credit cards, who visit your area, and these consumers are never measured or factored into traditional statistics. Plus, studies don’t take into account consumers from cities outside of the traditional 15 miles who don’t think they can possibly find what they are looking for in their city, so they drive somewhere else, thereby participating in Road-Trip Retailing. And studies don’t take into account the spreading of the wealth that occurs when consumers in your city, who logically should buy from your business, drive illogically away to spend their money elsewhere.

Now, I haven’t mentioned consumers who spend money over the phone, via catalogs, with infomercials, on the Home Shopping Network, or via the Internet. Those numbers cannot be accurately measured; they can only be guessed at.

And let’s not forget those consumers in your city or town who walk in, and say, “We’ve lived here 20 years and we never knew you were here.” Suddenly, your business has discovered incremental business in your backyard.  And remember:  Don’t slap that walking-around-in-a-daze, advertising-avoiding, living-in-a-vacuum consumer. This person is your neighbor!

Add all these groups up and even the smartest statistician can’t tell you the potential spending power that you can capture from the consumers who you could lure to your business, IF you were marketing your business as a Destination.

Here are 5 simple tips that should give you piece of mind about the potential of your marketplace:

  • Worry less about the limits of your immediate demographic area.
  • Focus more on creating a business that is so different, that you literally remake the demographics of your marketplace, and the share of it that you claim for your own.
  • Don’t simply focus on the consumer walking down your street, or driving by.  Focus on a consumer hundreds of miles away, and make your business so different that this distant consumer longs to visit your business in person. If you position your business to capture  that person and keep him or her interested, the ones walking down the street will be easy to pull in.
  • Think about attending our Destination BootCamp and learn how to reposition your business into a Consumer Destination.
  • And one last thought: Your “marketplace” is always larger than you can imagine, and most of us don’t imagine large enough
In Praise of Slackers

The last time I wrote in my blog, I wrote about complaining business owners who don’t make changes to improve their businesses.  If you don’t remember what I wrote, you can read it by clicking here.

Looking back, I was wrong about them.  I admit it!

I am now ready to embrace the complainers!  Here’s why:

My revelation on this point occurred when Alisa, our new Business Development Manager, left during the morning for a dentist appointment, but later returned a couple of hours later, resuming her regular duties.  Thinking about my own dentist appointments that are often filled with needles of Novocain shot into my gums, making it impossible for me to talk when I return to work, I couldn’t help but notice that she seemed quite functional.

So, I asked her: “How are your teeth?  Are you in pain?  Are you still OK to be at work?” But Alisa assured me she was totally fine.

She then said to me: “My dentist told me that if all his patients took care of their teeth like me, there’d be no need for her.  She’d be out of work.”  She explained that she took great care to clean and maintain her teeth after being told how important it was, and how her dentist appointments were non-eventful checkups absent of the pain I regularly came to associate with my visits.

We talked a little more and then, my light bulb moment occurred. It came to me in a flash that if everyone with teeth, brushed, flossed, and cared for them like Alisa, what a huge impact that would have on the dental industry! How would these dentist offices stay open, if all of their patients gave them nothing to do?

Let me use my dentist as an example.  I think my dentist’s office employs about 5-7 people, and I’d guess they are all pretty well paid professionals, all doing their work on people who don’t brush and floss as well as Alisa does. What if these people had no work?  For example, my dentist is a great dentist and a great guy, but I bet he doesn’t have any other marketable skills besides dentistry (maybe watch repair, with those tools he’s accumulated and his steady hand). But the rest of his staff? Not so talented.  I foresee “Will clean teeth for food” handwritten signs by the interstate.

Now, take this idea a step further. Multiply the impact if every dentist office in the country closed because everyone took care of their teeth like they should. Think of the massive unemployment problems that would result.  I bet most of these dental workers would be out on the streets, forced to selling their stash of free toothbrushes and mini toothpaste tubes. And think about that loss of revenue that previously circulated in our economy from people paying for dentures, implants, cleanings, oral surgery, x-rays…all of it gone!  What an economic downturn our country would experience, if everyone cared for their teeth like Alisa!

And that’s when it dawned on me that I’ve been looking at this the wrong way.  All those business owners who don’t attend my workshops, who don’t make their businesses unique and distinctive…these are people I should be thanking!  The owners who complain all the time and do little to help themselves while remaining stagnant, I should hug!  These owners are the ones who are maintaining the below-average business standards that allow the rest of my clients to stand out.  These owners are the people who set the low bar! These are the entrepreneurs who make it possible for any other company to look so good, by them being so bad at what they do.  These are the people whose poor service gets anchored in the minds of customers, so when my clients’ employees go just a little above and beyond the call of duty, their efforts seem Herculean.

I am the first one to admit when I am wrong, and I was wrong about the slackers.  It was wrong for me to have berated them.  The slackers, malcontents, and complaining business owners have done nothing wrong.  Granted, they haven’t done anything particularly right either, but they don’t deserve to be flogged into changing.

I’ve changed my mind!  Immobile owners like these should be praised. They should be encouraged to “Do nothing, move nowhere, change not!” Their businesses are perfect, in their most imperfect states, and the rest of the proactive business world needs them to maintain their business inertia.

So to all owners out there who are constantly working to improve yourself and your business position, do this: The next time you see one your business peers who fits this slacker/complainer description, don’t avoid them. Don’t look away. And certainly don’t berate them with those positive suggestions of change you typically heap on them. Next time, give them a hearty pat on the back and a cheery “Carry on!”

Their mediocre business is crucial to your creation of the Destination Business of your dreams. Without them, your challenges would be much more difficult.