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The trends, the issues, and productive business strategies.

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Why Independents Aren't More "Loyal" to Small Vendors 

Large vendors: Can't live with 'em, can't live without 'em. 

By Lisa Kanak The Cropper’s Corner (August 15, 2005)

(Note: In the previous issue, a vendor complained that, while she tried to stay loyal to independents – not selling at consumer shows or online, etc. – independents did not return that same loyalty.)

What this manufacturer says is true, the majority of independents are not building relationships with manufacturers by ordering consistently (or reordering at all). Unfortunately, the feeling out there is that independents have to "product hop" to keep consumers interested. And, to be fair, a little product hopping is necessary – but we independents probably do far too much.

Independents need to be looking for solid performers to keep sales chugging, but many of us don't know what those are. Unfortunately, this often means committing to a large manufacturer for those items, because they offer the depth and variety that stores need to stock.

While the big manufacturers do things that can hurt stores (product dumping, QVC, etc.), this is really more of a communication problem (manufacturers don't tell their stores what's going on) than anything else. When companies sell off product, the appropriate thing to do is let their retailers know that product line X has been sold to Big Lots, and give the stores time to discontinue it BEFORE it's on the shelves (as EK Success recently did).

Big manufacturers are many times the back-bone of an independent's sales; 40% of our store's sales in embellishments and stickers come from EK Success, K&Company, Sandylion, and Making Memories. The other 60% of sales come from a myriad of small-to-medium companies that help round out the business, but none of which could hope to replace those four.

The argument goes, if the "big boxes" have it, independents shouldn't. But the fact is, most scrappers don't head to a box store with their 40% OFF coupons to pick up stickers and embellishments. They usually head there – coupon in hand – for big ticket items. It's a fallacy to think independents cannot compete with the boxes when it comes to these smaller items.

It's these smaller items that keep us in business. In fact, there is a penny difference between Wal-Mart's price on Jolee's and our store – and that holds true for pretty much all of the "big boxes" and pricing on smaller items.

Re-ordering product is just as much a problem for large manufacturers as it is for small manufacturers. Roughly 70% of all retailers don't re-order most products. That's frightening. It means we're gambling way too much, period.

We need to make more decisions based upon sales figures than feelings. Sometimes, the sales figures favor a large manufacturer; sometimes they favor a small- to mid-sized manufacturer. But the real issue is that it is the retailer's job to sell. That means we have to stock what customers purchase.

As a larger independent retailer, I can honestly say that our store could not survive without the core product lines of the larger manufacturers – nor could we survive without the innovative, unique products from the smaller manufacturers. We need them both to create a diverse and interesting product mix in our store.

(Note. The Cropper's Corner is at 1621 Carl D. Silver Parkway, Fredericksburg, VA 22401. To contact Lisa, call her home office at 540-752-1935 or email lisakanak@adelphia.net. To read previous Memory columns, click on the titles in the right-hand column. To comment on this or any other issue, email CLN at mike@clnonline.com.)



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