Auto Service World
Feature   June 1, 2008   by Auto Service World

Onboard With Retail?

The retail marketplace continues to baffle many jobbers.

Taking a follow-the-leader approach (the leader being major retail chains), too many jobbers react to pricing only, and fail to understand the plan behind the big retailers’ actions.

For example, they tend to pick the lowest advertised price for a product, peg their price for that product at that level, and then leave it there. This misses the point that a promotional price is designed to exist for a limited time only, and that it is about advertising that price.

Many jobbers simply knock down their price on the product and fail to promote it at all.

Another misconception is that customers are only interested in price. There are always customers who will drive half a city to get a product for a bit less

(I once overheard a couple arguing over a jug of orange juice that was less than $2 more than at a warehouse club across town), but that is human nature–or at least some humans’ nature.

Unless you have “discount” in your name, customers are probably in your store because they feel you’ll have what they need, not just at the lowest price.

The point of promotional pricing is to get the customer into the store; once in the store, the focus must shift to selling them other items they need to build the retail ticket and make that whole promotional pricing thing worthwhile. This point is often lost on the less savvy retailer.

Another point that many jobbers fail to capitalize on is their competition. When was the last time you walked into your retail competition, looked around, and even asked a few questions? Visit stores in the U. S. too. Perhaps you should actually buy something and see what they do well and what they don’t.

Frankly, the number of misconceptions about what the truly expert retailers are doing continues to astound me. Lunchroom myths, rumours, and assumptions can be deadly. Forget everything you think you know and really check it out.

Do not just sit in your office and decide on what you think the facts are. You need to go out and get the real truth, statistics, data, and experience. Spend some money and some time to find out what a plan would cost. Look at the data, consider what your experience and knowledge tell you, and decide what your plan will be. Then stick with it.

That is the most important point: commitment. If a counterperson tells you that a customer won’t do business with you if you go retail, consider what that really means to the business in dollars. Don’t react on emotion. Stay committed to your plan.

The retail marketplace is not built on relationships. It is built on delivering a retail experience to customers who will be perfectly happy with what you sold them and how they were treated, but who may never walk in your door ever again.

In that way, it is totally different from the wholesale side of your business and, if for no other reason, requires a special approach.

The real clincher is that those who have been able to make that leap have done well, and what they have learned has made them better wholesalers too. –Andrew Ross, Publisher and Editor

In July, we profile the 2008 Jobber of the Year, and look at the latest in Tune-Up Parts, Coolant Technology and A/C Replacement Parts.

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