Retail Details Again!!

While we cannot be all things to all people, sometimes we miss details that cost us many customers due to our reluctance to be anything to somebody. 

Confusing statement?  Should be.  There are many confusing things in retail.  All the basic elements they teach us in B school.  All the theories on price, promotions, placements etc.  I think it was driven home to me last year when I was overseeing a chain of stores in Texas.  In any food driven business, cup sales are the first and foremost profit driver.  A little syrup or a little coffee and a container and we have liquid gold.  Very low waste factor, low labor cost and low cost of goods.  Magic.  But yet I watched numerous chains mess up this very simple formula.  How can you?  By not listening.  It wasn’t even a cost saving initiative.  It was just not caring about your customer.  And this turns into a bit of a rant here.  When you have lived your entire life in a market you do business in, market research should not be an extensive or expensive proposition.  Should it?  I hope not but this story proves that premise wrong.  When I first moved to the state to take on this challenge, margins were crap, food presentation and offering was erratic and attitudes were, how shall we say, laissez faire?  Nice combination for disaster.  Of course, the easy way to rectify many of those issues is with a simple food offering such as cup sales.  Fountain and coffee.  And considering our sign had a very good trademark for these categories, we should be golden.  But we made just a small mistake.  We identified the wrong menu for the fountain offering and then made a major capital investment in equipment to dispense that offering.  In the western part of Texas, ice is a very personal choice.  It happens to be, that in this part of Texas, a small pellet or crushed ice is the ice of choice.  By about 99.9% of any fountain consuming segment.  Unfortunately I discovered this after my arrival and after the purchase of the equipment.  And I was informed very firmly that small ice was the choice and why did you not know that and why did you not serve it and why did you ignore your customer and why and why and why and why.  Big trouble to say the least.  Here I am in a cash strapped organization, investing in a program that is intended to give us a very quick return on investment and improve our cash flow and I screwed it up.  I let a major purchase be completed without enough research.  Research which consisted of asking some of my friends and neighbors what their preference was.  And this was a very unanimous market research conclusion.  SMALL ICE NOW!!  This was such a strong preference that I had seen customers turn against traffic to purchase their preference.  On a regular basis, several times a day.  Imagine how I felt counting all those dollars go to the competition.  So, question or comment, what would you do?  Would you suck it up and replace all the equipment?  Would you leave it in and try to capture your customers with some other hook?  What would that hook be?  Would you discount price?  Try to capture a different age segment?  I can tell you now, suck up your mistake and do it the right way.  Even if you have to borrow at a higher cost of capital to achieve it.  By the time you re-educate the tastes of your target market, you will be dead.   Remember Coke 2? Why are we so stubborn and so reluctant to learn from history and other peoples mistakes?  Here we are in our thirties and forties acting as if we are five or six and having to do it on our own. 

Listen to your customers.  Learn your lessons from history.  Admit your mistakes early on.  And for God’s sake, get the ice right!!