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Challenges, problems, and triumphs -- from a manufacturer's perspective.

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Is Mike Dupey Right?

The industry's retail pioneer's criticism of chain stores elicits strong reactions.

by CLN Subscribers (November 7, 2005)

(Note: The last issue of CLN included an article by Mike Dupey, the founder of Michaels and MJ Designs and the creator of the modern craft superstore. Mike's article, which was a harsh criticism of the current state of the industry's chain stores, is still available at "Benny Da Buyer." The article elicited a variety of responses.)

When did we stop creating?

I happen to agree with Mike Dupey. There is not much new being developed in NEW merchandise! Why? probably because the manufacturer today is being raped by the chains, and in order to stay in business he has to sell the same old junk. Vendors have no R&D monies. There are no new creations. And the buyers are not demanding any nor will they accept any. Buyers are no longer merchants but mere computer specialists. Like Mike said, NO FEEL, NO TOUCH, NO UNDERSTANDING OF THE CONSUMER EQUALS NO NEW MERCHANDISE. It seems as soon as we wiped out the independent retailer we stopped creating. – Name Withheld, Manufacturer

The "modern" industry.

Mike, as usual, is right on the beam; that is, if it were still circa 1970-80. I called on Mike when he just had two stores in Dallas. His stores flourished because each store had his personal attention and he was without a doubt the most inventive, customer- and market-sensitive merchandiser in the industry. And, if arts & crafts would have stayed the small, personal, and folksy industry it was, Mike would still be the industry's kingpin.

Mike's demise was he did such an outstanding job of merchandising that he attracted the big guys who only think in terms of numbers. Thus, it was the beginning of not only Mike's demise, but the demise of the entire arts and crafts market channel as we old, old (that's two olds) industry people remember it.

I'm reminded of something my mother use to say when she heard some old guy expounding on how things should have been done. She would say, "If he's so smart, how come he's not rich." – Gerry Garri, retired.

Fines and margins.

I had a great many thoughts after reading Mike's comments in your latest edition:

1. Gross margins. When did it get to the point that retail had to have this enormous markup, plus, as they say, "incentives"? Could it be that they have this giant overhead that must be supported ?

You and I both can remember when a 50-10 or better yet a 50-25 was fabulous and a retail person could work with all of that and make a very decent living.

2. Just received another letter from a company fining us for this, fining us for that. You know it's just getting to the point of vendors need to fine the chains for sloppy remittance checks, for slow payment, for never returning a call, for no answers on why a payment has not been made, for a purchase order that is not correct, and for, well, need I go on? – Name Withheld, Mid-size Manufacturer

Pulling punches.

I love this guy!! He never pulls any punches and just says it like it is!!! I particularly like the comment about the Michaels ornaments!!! – Name Withheld, Importer

Computers and creativity.

Mike he IS right – the computer drives too much today. Every Sunday when I pick up the newspaper I can always go to the Michaels ad first – it always looks EXACTLY THE SAME EVERY WEEK, WEEK AFTER WEEK. NO creativity in the ads for a chain who bases its business on CREATIVITY? Name Withheld, Importer

Same old, same old.

I have to agree with Mike Dupey on some items. He is on the right track about the same merchandise all the time. In our local Michaels the Christmas ribbon is in the same location and displayed the same way it has been since the store opened. The same thing for the Christmas Village Building in Jo-Ann's. I see Michaels still has the same ivy bowls in different sizes as they did four or five years ago.

I was delighted to see Michaels stock the new fashion yarns from several companies to offer a wide range of textures and colors. But the department didn't get bigger; they simply offer a small selection of core yarns like knitting worsted. Hobby Lobby, on the other hand, brought in the fashion yarns while keep most of the core yarns. They considerably expanded the shelf space for yarns.

There are other examples of the "same old stuff," but it's too late at night to get upset by them and then not be able to go to sleep at a decent hour. – Name Withheld, Service Provider

POS = history.

I particularly agree with [Mike Dupey's] thoughts about the use of a POS system. I know it is impossible to run a business the size of a Jo-Ann's or a Michaels without it, but little do they know that their POS systems are what gives independents their advantages over the chains – if we will do it. So many of my business associates have ridden their businesses into dust because of their blind allegiance to history. Isn’t that what a good POS system is all about, history?

What happened yesterday or last week or last month or year is one thing, but in reality, what the consumer wants from a craft store is what is new, exciting, and fresh, not what happened yesterday. Even worse is the fact that the practice-makes-perfect edict in operation for most businesses precludes buyers from being creative, innovative, or bold. God help the buyer who does not repeat last year’s successes; therefore risk tolerance is low and new ideas become even bigger risks.

I would also echo Mike’s thoughts that most every craft store today looks just like the one down the street and there is no identity that differentiates them. If you took the sign down from over the front of the store and substituted a sign from any of the other three craft stores, the customers would never know the difference. The layouts were the same, the advertising done was the same (40% off anything anytime, or it was going to be 50% off next week?), no customer service, checkouts backed up during busy times, no models, no ideas etc. All in all, no creativity: boring, boring boring! – Bob Ferguson, Ferguson Merchandising

Education?

Mike Dupey is right on; everyone talks change, but nobody is doing it except to cut out the designers and continue to do less and less education of products. There really is no reason to create new products if no one knows how to use them or even knows they are for sale. Bottom line has become the only important factor.

Three cheers for Mike Dupey to tell it like it is and three cheers for you being courageous enough to print it. I wish I knew how to "fix" the problems.

I know for sure we need education!!!!! Who wants it, who is capable of teaching, and how to do it since there are only about 12 buyers in this U.S. Any ideas? Doxie Keller, designer/author

(Note: Well, do you have any ideas? Is the lack of education and creativity the problem? If so, what can be done about it? Email your thoughts to CLN at mike@clnonline.com. To read previous "Vinny" columns, click on the headlines in the right-hand column.)

xxx

 

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