by, Jeremy Lesniak

It’s clear to anyone that has spent time in “small-town America” that we’re starting to lose the traditional small stores that have long comprised our downtowns. Many are quick to point the finger at the internet or large corporations. The issue, though, is that many of these shops have resisted change to their business model for years and are now feeling strong effects from it. I know the effects quite well, being a business owner. In this month’s article I will outline how traditional store owners can fight back against the competition of the internet.

Internet shopping has come to stay. By offering (typically) a better selection, better prices and shop-at-home convenience, internet stores have become the first choice for many shoppers. Brick and Mortar operations have struggled to keep up, and many of them have folded under the pressure of decreased sales and margins. The response from many has been to point the finger: at the internet, at those who buy online, at the governments for enforcing sales taxes locally that aren’t mandated on the web. Yet, with each technology that comes into our lives we must adapt. The stores that choose to survive must adapt to the times or become obsolete.

Even the most internet-savvy shopper doesn’t buy everything online: few of us buy our groceries online. There is yet a process for an “internet oil-change” for your car. Thus we cannot live without our downtown stores. They have a place in our lives that cannot be ignored. That, then, is the key – our downtown stores need to find ways to fit into our lives, not the other way around. If the stores want our money they must appeal to our needs.

Groceries, nails for that project you’re building or parts for your car will always need to be stocked locally. The things we forget about, too, have their place on our local store shelves: paper, ink, and other office supplies. There are plenty more, but I won’t fill my space with a list. This is the first niche the local stores can fill: stocking the products we need often and cannot wait to have shipped from an online merchant.

It’s a myth that the internet always has lower prices. I shop online for a lot of things, and I know that often times shipping and handling charges pushes the cost of items far beyond the price I can pay for local goods. Many of us don’t realize that, though, and the stores do little to educate us.

Downtown merchants have their best opportunity by positioning themselves differently from their internet counterparts. If both are constantly screaming about price and selection, it can be hard for the customer to know who’s right. If the local stores change their tune, so to speak, and promote quality customer service and a better shopping experience, people will listen.

What constitutes a better shopping experience? Think of it in terms of fun. Stores that make shopping enjoyable will always do well. LL Bean in Freeport, Maine comes to mind. Snowsville General Store is another destination depot. By becoming something greater than the products they sell these businesses have developed loyal, even cult, customers. Many businesses do this and don’t realize it: bookstores that have children’s story hour or coffee shops with free wifi build value into their product. Value that businesses like Borders.com or Gevalia can’t touch.

How else can the downtown stores defend themselves? We’ll keep with the evolution theme. The same business model that worked in the past doesn’t work as well anymore.

1. If a store is open Monday through Friday from 9am to 5pm you’ve already alienated the majority of your potential customers. The world turns seven days a week and your open sign should be lit that often, too.

2. Consider expanding your product offerings. Most businesses can have products delivered to them they wouldn’t normally carry. By not stocking the item they can offer it at a lower price than they normally would.

3. Become a destination store. Anything you can do that gets customers in without buying something will translate to sales. It may feel costly, but just like businesses that offer sale product below cost; it’s a loss leader that does increase sales.

4. Find ways to develop long term relationships with your customers. Frequent buyer or discount card programs work wonders. Stores that sell consumable products can send reminders to their customers at predetermined times – “Are you out of yarn? Come in and stock up today!”

5. Offer low-margin “special order” products. By not keeping them in the store you can afford to expand your product lines. This works best with expensive items and add-ons.

6. Increase your marketing. Most businesses, especially downtown retail, don’t do enough with their marketing. The internet has dramatically increased competition and invalidated the “if you build it they will come” mantra of days past.

7. Solidify your image. Most small operations have no clearly defined personality. Whether they know it or not, the shopping populace responds to this, which explains the success of retail chain stores. The image doesn’t have to be overly specified, but having consistent colors, fonts and logos can make a big difference.

Downtowns aren’t dead, but they could be soon. Good businesses face the facts and make difficult decisions. Businesses that refuse to change, like a shark that stops moving, will die. I don’t pretend to be an expert on this subject, but I have spent most of my life in the retail industry and I know these things to be true. Keep in mind, you’ve got a wonderful group of supporters that will offer advice if you just ask them – your customers.

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