Creative Leisure News - Benny da Buyer

A view of the industry through the eyes of a chain buyer.

The Craft Industry: Slipping & Sliding

The cause? Computers instead of creativity.

by Mike Dupey (October 17, 2005)

(Note: Mike is the founder of the Michaels and MJ Designs chains. He has been honored by HIA (now the Craft & Hobby Assn.) as the founder of the craft superstore and was considered the most innovative, creative retailer in the industry. He was also known for his strong opinions.)

Thirty-five years ago owning a craft store was an individual trial-and-error method. It took eight years to do $1 million in sales in the first Michaels store in Dallas. We then found the answers and in three years sales increased to $6 million in that small 9,000-sq.-ft. store.

Now two large chains, Jo-Ann�s and A.C. Moore, are struggling for sales and profit. Michaels and Hobby Lobby are in better condition, but they also will be struggling if they do not change.

What are the problems? We are in 2005 not 1995, we rely too much on computers, we use the same old advertising, there's a serious lack of new ideas and departments, and it's the same old merchandise each year. Seasonal departments are the same in all chains. Nobody changes.

Michaels did change for a new Christmas look. They now have some of the ugliest ornaments I have ever seen. All chains mark up Christmas goods to the highest retail, only to mark it 50- 60% off their retail; that equals a 73% markup. A.C. Moore brings out last year's goods at normal retail and how long do you think the customers are going to look at that sorry mess? Jo-Ann�s brings in Christmas with no consistency and it looks cheap even before they even mark it down. Yet Hobby Lobby can buy and sell without a P.O.S. system.

If you can�t find anything new, there are thousands of people in the U.S. to design and create excellent lines for your company. To succeed you must change your look completely. Find, discover, and build new and profitable departments. There are many areas in which to grow and still have your own identity.

A craft store is not a 40%-to-60% off everyday sensation. Selling the same inferior merchandise in every chain will not increase sales and profits. This isn�t competition, this is retail slipping & sliding. The same ad circular 40 times a year makes a great fish wrap.

Suggestions.

1. I see scrapbooking as huge, but new, fresh samples and ideas are needed.

2. New floral items are available all the time; why not try?

3. Home Dec � more can be accomplished in this area then all others. All craft chains have failed in this department. Why? Cheap junk does not sell.

4. People do not have time to do a lot of crafts! Offer ideas and trends that do not take a lot of time.

5. Expand your make-a-bear, stuffed toys, or Sponge Bob departments. (I never thought I would say Sponge Bob; I hate him, but my young granddaughters worship him).

Today craft stores are machine driven and calculated. The last time I looked at my computer it offered only numbers and totals. The computer does not show the feeling, touching, or respect that goes in creating departments. It is a machine, cold hearted and lacking design capabilities. Use it for only for numbers; the computer is not a creator; never has been, never will be.

I love and enjoy crafts but I have learned there is much more to sell in this world with crafts that will increase sales with higher profits.

People in this day and age read and look at suggestions about changing, but do nothing as the sales and profit keep slipping & sliding away.

(Note: Is Mike right? Email your thoughts to CLN at mike@clnonline.com. To read previous "Benny" articles, click on the titles in the right-hand column.)

xxx