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The trends, the issues, and productive business strategies.

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What's Happening to Scrapbooking? 

Readers offer complicated, tough answers.

Compiled by Mike Hartnett  (September 5, 2005)

(Note: CLN asked, "What's going on out there?" – and readers responded. These comments relate specifically to scrapbooking. To read other readers' analyses, click on Business-Wise in the left-hand column, or click HERE.)

Industry consultant.

1. Lack of operating capital to stay in business and compete generally due to a lack of business plan or strategy.

2. Discouraged by the number of the "big box" stores bringing in product and more product with a specific focus on the paper arts; therefore they don't feel they can compete so they close.

3. Exhaustion from the everyday business. Mainly due to creative people getting into business and not finding any joy in the mundane, everyday issues and challenges of the retail business; therefore they have chosen to close.

4. Year 3 and 4 stores are in the "Help me I'm drowning" stage; they don't know how to handle it, panic, and close.

5. Many stores, instead of selling, have chosen to simply close. Not because they did not have successful stores, but that they want to try something new.

6. Many multiple store owners are closing their additional stores to manage the first one better. Another factor playing into this has been that they copied the formula of their first store but this has not worked in the second and/or third location.

7. Many stores did not change with the way the scrapbook business is going and stuck to the "cookie cutter" store mentality. The stores failed to establish a strong ownership of their retail corner and supply to what their demographic called for. Many did not keep up with the changes in the industry. Unfortunately, these stores simply ran out of customers willing to shop at their stores.

8. Failure to be able to maintain the high pace of demand for the latest and greatest product driven by the idea magazines. This often led to poor buying and merchandise decisions, then they were too late clearing them out, thus forcing the store to take a great loss on products. This reduced the store's profitability and often crippled the store, ventually leading to closure.

The good news is that we are still seeing new stores opening up, generally by business minded owners. Many solid and strong independent stores are doing very well. The stores doing well have a similar formula. That information, however, is why we are in business! – Pamela Grimm, President, Ideaco. (Note: Ideaco is an independent firm that works primarily within the craft industry with independent retailers and manufacturers. Call 519-798-9930; email gottaidea@aol.com; visit www.bizzyretailer.com.)

A Craft Designer/Memory Manufacturer.

To respond to your question on the decline of independent stores, I had an interesting conversation with an independent store owner at the CHA Summer Show, who had decided to close her store. She told me that she could make more money with less cost and time by using her knowledge to consult for manufacturers and help them connect with independents. She also said that other store owners were doing it as well.

I thought it was interesting that there’s this trend to educate the independents, but independents are quitting to do it.

A Scrapbook Independent.

Lisa Kanak only references the "40% off coupon" as the problem with the chain stores and their prices. While it is true that this particular marketing ploy may apply more to big ticket items and not the paper and stickers, she didn’t mention at all the "50% off all scrapbooking" sales like Hobby Lobby is doing this week. The sale covers everything from stamps and inks to papers, embellishments, and tools. This DOES impact us. Although I don’t sell much of the same stuff that Hobby Lobby carries, it diverts $$ that scrapbookers would normally budget to spend in my store.

A Scrapbook Independent.

I am a scrapbook store owner. I have been opened almost 5 1/2 years. I seem to be getting deeper & deeper in debt. I think the problem is too many stores are taking a piece of the pie. I now have nine places in my small town that have an aisle of scrapbooking products. Sure, none of them carry a lot (although Wal-Mart is getting more & more!), but every sale somewhere else where hurts me.

Also, new products are being introduced to often. I just get a few pieces of the newest paper sold and my customers want the new stuff they saw in a magazine. OUCH.

I am in the process of trying to find a product to sell that will support my scrapbook store. Possibly high quality baby furniture.

Small Distributor.

As a small distributor, we have a close relationship with our regular customers so we usually hear why they close or if they are thinking about closing. Needless to say, dwindling sales is the reason.

One of our healthiest accounts constantly works on new ideas and what they can sell. If

they like a product, we can be sure they will be out there promoting it. But it's hard for a small independent to maintain the high level of activity and enthusiasm that's need for continued success. And it seems as soon as someone gets discouraged, others start slumping.

Yes, there is competition for the same piece of the pie, but I think small retailers have to recognize that they get stale after awhile and their customers slow down. One shop has trouble filling their classes, but the class that did fill had a teacher showing new products and new techniques. In fact, the same teacher did not get a good sign-up for the first class and changed the project. The new project had a good sign-up considering it was a substitution that did not receive the advertising the original class did. Many teachers have had no particular training and many don't know how to promote product. The chains might have the advantage here of knowing what category is not performing and moving on to devote more space and classes to whatever is "hot".

A large store can easily make a transition whereas the average independent probably doesn't even have a POS system and tries to hang on to what used to sell well.

I'm not sure the old adage that it's cheaper to get an existing customer to buy more than it is to attract a new one is true anymore. The chains may be able to keep a customer because they are able to offer a new craft when the customer is ready to do something different. The independent who is specializing in something like scrapbooking doesn't have that option. They aren't going to start selling expensive yarns when knitting is hot and they aren't going to bring in a line of beads.

Basically, I think there are different reasons behind a slowdown for the independent and one for the chains. The chains should be able to answer the question, "Are there less customers or is the average ticket sale down?

(Note: Where does scrapbooking go from here? What should be done to improve the situation? Email your thoughts to CLN at mike@clnonline.com. To read more comments on the state of the industry, click on Business-Wise. To read previous Memory, Paper & Stamp columns, click on the titles in the right-hand column.)



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