A view of the industry through the
eyes of a chain buyer.
The Craft Industry: Slipping &
The cause? Computers instead of
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-Annís 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
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-Annís 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.
If you canít 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 isnít competition, this is retail slipping &
sliding. The same ad circular 40 times a year makes a great fish
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 Ė 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
People in this day and age read and look at suggestions about
changing, but do nothing as the sales and profit keep slipping &
(Note: Is Mike right? Email your thoughts to CLN at email@example.com.
To read previous "Benny" articles, click on the titles in
the right-hand column.)