Insanity?

“One definition of insanity is to continue to do the same things over and over expecting different results.”

They say that you should never mix business and religion, but frankly I don’t see how you can separate the two.  If you were to ask me the one thing that might make a business successful I would say, “Do unto others as you would have them do unto you”, the “Golden Rule” as stated by Jesus of Nazareth.

But the thing that brought the association between faith and business to mind was the above quote on insanity.  I don’t know who first said it, but I stumbled onto it last night in a reflection for Lent.  The author’s point was that if you want to improve yourself, you can’t just keep doing what you’re doing.  You have to change.  It’s a good thought for Lent, but it’s also a good thought for running your business.

If you’re completely happy with your results, then you shouldn’t make major changes, except to keep up with changes outside your control.  You have to adapt to the economy.  You have to adapt to new technology.  You have to adapt to changes in the market place.

On the other hand, if you’re not happy with your results, it is insanity to think that things will improve if you just keep doin’ what you’re doin’.  Because if you do keep doin’ what you’re doin’, you’re going to keep gettin’ what you’re gettin’.

While many of us will be using the next six weeks to reflect on our personal habits and to try to improve, maybe a “Business Lent” might not be such a bad idea either.  After all, our businesses are a vehicle for you and I and our families, for our employees and their families, and our customers to have better lives.  Striving to make those lives better by improving our businesses is something that I think the Lord Himself would endorse.

Stay tuned to Mining the Store  and we’ll do our best to help.

Have a great weekend!

Independent Businesses Get Organized

amiba-bumper-sticker

As a follow-up to yesterday’s post on independent business, here are some interesting figures from the American Independent Business Alliance (AMIBA).  According to their January 15, 2009 press release, a survey of 1,142 independent retailers found that holiday sales at independents declined an average of 5.0% from the same period last year compared to a 9.7% decrease in all retail.

The survey was conducted for AMIBA, so it’s not surprising that the results were favorible to their cause, but it’s still impressive to note that independent retailers in cities with “Buy Local” organizations saw sales drops of 3.2%, much better than the 5.9% decline in cities without such organizations.

I swear that I read the press release after posting yesterday’s article.  The following quote certainly backs up what I said.  It’s from Jeff Milchen, AMIBA co-founder:  “While most economic recovery stories focus on national policy, finding ways to recycle money within the local economy is the most effective economic stimulus for most communities.

Milchen recently published a feature in the San Francisco Chronicle, “The Next Bubble to Burst?” urging communities to enact laws that encourage the growth of small, local  business.

Yesterday I mentioned some reasons why consumers should support local business, but here are some more that you might highlight in your store from an handout called “The Hometown Advantage.” from the New Rules Project, another group that promotes local business.

  • Jobs and Tax Revenue. New chain stores create jobs and pay taxes, but at the expense of existing local businesses.
  • Public Costs. Spread-out land use patterns raise the cost of roads, sewers, and police and fire services.  The costs of retail sprawl can exceed additional tax revenues, if any.
  • Local Economy. Mom and pop keep the money local.  The big bux stores send it out of town.
  • Consumer Choice. Centralized buying reduces the number of suppliers, limiting choice for consumers and opportunities for small suppliers.
  • Long-term Prosperity. Research is showing that trading a vibrant downtown for cookie-cutter development reduces the attractiveness of a community, limiting the prospect for future investment and well-paying jobs.
  • Environment. Chain store sprawl is harmful to the environment, increasing automobile usage, air pollution, and stormwater runoff.
  • Community. Local business owners are often very involved in community activities.  They give more money to charity.

Check out AMIBA’s web site, or the New Rules Project, or the Institute For Local Self-Reliance. There may already be a “Buy Local” organization  in your town.   If not, starting such an organization is a fairly simple project, especially if you can involve other like-minded members early in the process to share the work.

Clearly many Americans want to buy from you.  All you have to do is give them a little nudge.

AMIBA window decal

AMIBA window decal

Buying Locally–Are There Limits?

A regular reader and former coworker emailed me over the weekend with an interesting question about buying locally.  He asked, “At what point is price an issue?” He cited a couple of recent instances where he paid more to buy something locally rather than buying it online.  The price difference wasn’t enough to be a problem, but is there a point where price trumps doing business with a neighbor? It’s not unlike the question, “Can you be a little bit pregnant?”

The question raises still more questions!

Aren’t some mail order businesses run by independent business people? In the past I have written good things about Heather Gorringe and her “Wiggly Wigglers” online gardening business. (A Small Business Owner Who Knows How to Use Social Media. A Big Award for Wiggly Wigglers) You can’t lump her into the same category as Amazon.com.  I’d buy from Wigglers if I were into gardening (and if she weren’t in England, making shipping very expensive.)  It’s a global mom-and-pop operation, something that would have been impossible just a few years ago.

What does “local” mean? Here in Saint Louis, at least until last year, Anheuser-Busch was a local business.  Was I supporting local business by buying Budweiser?  Yes I was.  But what about local micro-breweries?  Wouldn’t drinking a beer from Schlafley (a local micro) be more in line with a Buy Local philosophy?  And what about Guinness which is unique and only brewed in Ireland?

Then there’s the issue of determining what’s local and what’s not.  McDonald’s is a national chain, but the individual stores are locally owned. Then again, all of their raw materials come from McDonald corporate.   On the other hand, there are some similar operations, like White Castle, where the company owns all the stores.  How many people know that?  How do you know which is which?  Given the addictive taste of a White Castle burger, and their low cost, does it really matter if I eat there?  Like Mickey D’s, they bring the stuff in from out of town.

Does buy local trump buy American? Chances are that you’ll be more likely to find American-made items at your local hardware store rather than at Lowes or Home Depot.  But, what if you don’t?  What if the chain has an American-made drill and everything at the local True Value is made in China?  Which is the better choice?

bookstoreWhat about unique items? Again, the local merchant is more likely to have the really unique items, but not always.  Books are a good example.  Sometimes the only place to find an off-beat book is at Amazon.com.  Let’s say that the local book store (if you can find one) doesn’t have the book, but can order it for you.  It will cost $50.00 and take two weeks.  Amazon can get you the same book in two days and it will cost you $40.00 (including shipping and handling).  And you need the book for an important project that’s due in a week.

This one is pretty easy.  You have to go with Amazon because of the deadline.  But what if there is no deadline.  What if you just want to read the book?  Is it worth ten more dollars and twelve more days to support the local business?  Nobody said this was going to be easy.

Buying locally takes some effort.  But it’s worth it.  You wouldn’t be reading this if you didn’t have a vested interest.  If you want your friends and neighbors to do with business with you, you have to do business with them.  It’s as simple as that.  That’s the short-term answer.

Long term, if you want to have a neighborhood hardware store hardware-storeto answer your questions, and to have the part for your twenty-year-old lawn mower in stock, then you’d better do your part in keeping them around.

A lot is being written and said about economic stimulus.  I’m not an economist, but I do think that stimulating the national, and even the world, economy starts with stimulating the local economy.  We all know that small business is responsible for the lion’s share of jobs in the United States.  A sign of a healthy economy is a lot of “help wanted” signs in the windows of our local stores and restaurants.  We can make that happen.

I just realized that I’ve written quite a bit, 698 words and counting, and haven’t answered the question, “At what point is price an issue?” First, I think you have to look at value rather than price.  And value includes the services and potential services that the local business offers.  What looks like a better price may not be.  In the case of on-line purchases, have you considered shipping and handling?  What about the hassle of receiving the merchandise (for example, taking off work to be home when the package is delivered) and the possible hassle of returning something that isn’t right?  Can you trust the vendor to deliver the product as ordered?  All of these come at a price.

If you’re comparing a local store versus a chain, are you comparing apples to apples.  The big guys often have products that are built to their spec, which may not be your spec.  An items that’s ten percent cheaper but wears out twice as fast as a similar one isn’t much of a bargain, is it?

If an item requires assembly or technical knowledge to operate, who’s going to help you out if you have problems, the “helpful hardware man” or the guy in the blue smock who just started to work yesterday?

To wrap this up, you have to make up your own mind what you value and what you don’t.  Everything has a price.  You get what you pay for.  (Insert your own cliche here.)

As a business person you might want to do unto others as you would have them do unto you.  But what about your customers?  How do we get them on the “buy local” bandwagon?  It’s all about education.  Show them why your product is worth more than your big box or out-of-town competitors.  Use in-store signage, advertising, your web site, and your presence on social media (you are on social media, aren’t you?) to tell them why it’s in their best interest to buy from you.  Because, when all is said and done, people do what’s in their best interest, not yours.

I’d especially welcome comments on this important topic.

Why the Big Three Don’t Deserve a Bailout

OK, we’ve heard Detroit’s tale of woe.  They’re going broke because we aren’t buying their cars.  It’s not their fault.  It’s our fault.  Let me say, in the spirit of full disclosure that I drive a Mitsubishi Eclipse, built by a Japanese company in Illinois.  My wife drives a Toyota Highlander, made in Japan by a Japanese company.

Don’t get me wrong.  I’d love to buy American and, in fact, I’ve tried.  But I just haven’t been able to get any of the American dealerships to sell me a car for as long as I can remember.

A brief history.  In 1997 I bought a Chrysler Sebring.  I bought it because I wanted an American-made convertible and the Sebring was the one I liked.  I bought it.  Nobody sold it to me.  They didn’t have to.  I went into the closest Chrysler dealer, pointed to the car, and they wrote it up.  No selling required.

Sadly,  two years later a hopped-up semi-truck driver decided the Sebring was invisible and moved into my lane at 60 mph.  The result:  One totaled Sebring.  Considering that the car was totaled and that my wife, son, and I walked away under our own power, I decided I wanted another one just like it.

Back to my local dealer (who had since moved and wasn’t quite so local anymore).  This time I couldn’t afford a new car so I needed a year-old used car.  The dealership had none but the “salesman” promised he would “check around” and call me back.  He didn’t.

So I tried my luck with another Chrysler dealer in another part of town.  They had the car I wanted but really didn’t want to be bothered with taking my money.  The “salesman” was new, having moved over from the cell phone business.  Oh boy!

After finally convincing Skippy that it was ok for him to take my money, I had good luck with the car.  But like all cars, it eventually wore out.  I’m not sure exactly why, but I went back to the Chrysler well one more time.  This was two years ago.  I knew exactly what I wanted.  Not one, not two, but three Chrysler dealerships wouldn’t give me the time of day.  Guess what?  Two of the three are now out of business.  Imagine that.

Mitsubishi Eclipse (Not me driving.  This guy has hair.

Mitsubishi Eclipse (Not me driving. This guy has hair.

On a whim I went to check out the new Mitsubishi rag top, the Eclipse.  I liked the car but they didn’t have the color/engine combination I was looking for.  The salesman (no quotes this time) moved heaven and earth to find me a car.  Mitsubishi ended up building the car I wanted.  The car was built on a Monday and I picked it up on Wednesday.

We had the exact same experience with Ford and General Motors when we went to buy my wife’s SUV.  It was the end of the year and all the American companies were offering big rebates and running huge ad campaigns.  But the dealers all dropped the ball again and we bought the Highlander.

As Paul Harvey would say, “Here’s the rest of the story.”  One of my adult children (a contradiction in terms, I know) owns a Dodge pickup which recently failed the state-mandated emissions test so we took it back to the dealer where he bought it, a place called South Town Dodge, last Thursday.  Normally I wouldn’t get involved in my kids car repairs, but I loaned him my car while his truck is in the shop.  I’ve been carless for seven days.

Not only is the truck not fixed after one full week, they won’t even return his calls.  The deal was that they would call him and let him know what was wrong with the thing before they fixed it so I’m guessing that they haven’t even started.  At a time when the parent company is begging for more of my money to keep from going out of business, you’d think that the service department might be a little more customer-centric.

At this point you can be sure that my son will never buy another Chrysler product.  His mother, father, and three siblings will never buy another Chrysler product.  His numerous friends will never buy another Chrysler product.  Thousands of readers of this blog may never buy a Chrysler product. Even if any of us would, they probably wouldn’t take the time to sell it to us.

Here’s the thing.  The economy is tough right now.  Every sale and every customer are important whether you’re asking for a government handout or not.  I intend for my next car to be American but if the “Big 3” don’t get their sales and customer service acts together, all the bailout money in the world won’t make a difference.  “If you build it they will come” may be true for baseball fields, but for anything else, not so much.

REAL Economic Stimulus

My wife was born there.

St. Elizabeth Hospital

In the midst of the kerfufle concerning the government’s attempt at stimulating the economy, a local hospital has decided to take real action.  St. Elizabeth Hospital in Belleville, IL is giving it’s employees a $100,000 bonus.  There’s just one catch.  The money must be spent at one of the thirty-eight local businesses that line Belleville’s central business district.

Rather than count on the geniuses in Washington, the hospital is taking immediate, effective, and concrete action.  The first half of the money will be distributed equally to all employees.  The second half will be given proportionally, based on length of service.

The hospital wins by having happier employees, a more prosperous community, and some very positive PR.  The employees win by having more money to spend.  The local merchants win by gaining extra business.  And the city wins by having an additional $100,000 circulating in the local community, generating additional tax revenue.

Ask yourself, what can you do within your local community to generate this kind of win/win/win economic stimulus?  Any ideas?   Let us know.

Score One for Local Business

I’m going to let you in on a little secret.  When it comes to promoting independent, local business, one of my toughest sells is my own lovely wife.  She gets the principle and has shifted most of her business away from the chains, but I often get the feeling that it’s just to humor me.  The thousand-roll pack of toilet paper from Sam’s Club still shows up in the basement once-in-a-while.

One issue that’s been pretty cut-and-dried is grocery shopping.  For whatever reason, the St. Louis area has rejected national grocery chains in favor of two locally-owned operations, Dierberg’s and Schnucks.  There are a couple of national discount chains and specialty chains like Whole Foods and Trader Joe’s, but by and large, the two locals own the full-line grocery business.  We’ve had Kroger and A & P, and others through the years, but the local chains have run them all off.  With the exception of Sam’s Club and their mega-roll toilet paper and their giant boxes of laundry detergent, and the other exceptions mentioned above, most of our grocery dollars have stayed at home.

The issue came up recently when Wal-Mart opened  a “Super Center” about a mile from our house.  Of course Mrs. B. checked it out.  “It’s such a nice store.  Their prices are lower.”  The usual arguments for sending money to Bentonville. I went and looked at it and it is nice.   Besides, who wouldn’t want to buy their baked goods and their transmission fluid in one stop? But she dutifully continued to patronize the local chain though I know there were a few things that she was picking up at Wally World.

Then something strange happened.  Last week the bagger at Dierberg’s  called her by name and said, “Mrs. B, we know you have other choices and we really appreciate your shopping with us.  You’re a loyal customer.  Thank you.”

“Thank you.”  No free loaf of bread.  No bonus coupons.  No complimentary cup of coffee.  Just a sincere thank you.  Imagine that!

And guess what?  As far as my wife is concerned, the Wal-Mart grocery department is no longer in the hunt.  No one at Wal-Mart has ever said thank you.  In fact she says the checkers are “grumpy”.

I know she’ll continue to buy paper products and cat litter from you-know-who.  And I’ll still go to Trader Joe’s for frozen Orange Chicken and giant cashews, but the bulk of our grocery business will stay at Dierberg’s where it’s been for years.

In the past few months, the local grocers have spent a fortune remodeling stores, running ads, and even cutting prices.  Some of that cost was necessary, but don’t ever let anyone tell you that service is dead or that all that matters is price.  People still appreciate service and they appreciate being thanked.  And, folks,  it doesn’t cost a thing.

They’re Talking About You

Friday I wrote a post, Word of Mouth, where I praised Holiday World Amusement Park, Santa Claus, IN, for great customer service.  Rather than use high-margin soft drinks as a profit center, they use them as a perk for their customers.  Soft drinks and other beverages are free, both at the amusement park, and at the adjacent water park.

Just a couple of hours after I posted the article, I received a comment from Paula Werne from Holiday World’s PR department thanking me for the “love” and pointing out the parks also offer free sunscreen, free parking, free innertubes at the water park, and free ponchos when it rains.

Obviously Holiday World isn’t leaving their on-line reputation to chance and you shouldn’t either.  Using free tools like “Google Alerts” you can become instantly aware when someone mentions you, your business, or any other topic of interest on the web.

By following her business’ name Paula was able to build on my positive comments by adding facts that I didn’t know.  Even more important, if my comments had been unfavorable, she could have joined the conversation, turning a negative into a potential positive.

People are talking about you on the Internet whether you know it or not.  Shouldn’t you be part of the conversation?