Pruning is needed for the overgrown retail landscape

Hendrix is seven years old and has a great green thumb. We began planning for the upcoming gardening season last winter. We researched the types of vegetables and fruits we wanted to plant together, and then we plotted them against our garden footprint.

Hendrix took great care to ensure that each plant was healthy and able to produce a large harvest. The garden was flourishing and was growing at a faster rate than we could have imagined. As the season progressed I began teaching him how to prune overgrown branches to encourage plants to grow larger fruits and vegetables.

He was skeptical immediately. He wanted to find out how a plant could be made healthier by cutting its branches. He was skeptical that this would make our garden produce better. He was actually convinced that it would not only slow down, but even kill our garden.

As we started to prune our garden, I encouraged him to trust me. Hendrix began to realize the importance of maintaining a garden as we harvested new fruits and vegetables throughout the season. Every week, our garden produced more and better food and we enjoyed a feast like kings.

Hendrix is adamant about deadheading our garden. He knows that this will allow him to spend more time on the plants that are best suited to produce the greatest harvest.

The U.S. Retail Market is like an Overgrown Garden

The internet is abuzz with prophecies about a retail apocalypse and the doom-and-gloom of retail. Over 10,000 retail stores have closed in the past 12 months and almost 60,000 associates lost their jobs.

While it is obvious that some stores have closed, more are likely to follow. However, I do not believe in the total death of retail as many people proclaim. Here’s why: America has the highest retail square footage per capita of any country. The delta is not even close. According to Forbes in 2015, the U.S. had approximately 50 square feet per capita of retail space. Europe, however, had 2.5 square feet.

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The consumer has changed what he or she buys. There are more products to choose from, and they have instant access to more information on what to purchase. You can search the Internet for gardening tools, food and watering cans. The options are limitless. How can you choose the right product? To make matters worse, consumers aren’t sure who to trust to help them choose the right products for their needs. Only 4 percent trust traditional advertising.

Finally, many retailers are trying too hard to compete with and try to be their own e-commerce giant. Instead of leveraging the power and convenience of brick-and mortar shopping experiences, retailers are raising stock levels while simultaneously decreasing prices to their own demise. They will lose this battle.

The U.S. retail gardens are simply too overgrown and need to be pruned. Overstocked, obsolete, and overpriced retailers will be exposed and beaten down. As the retail landscape changes, only those retailers that meet the needs and expectations of the customer will survive the challenging season. They will thrive over time.

2 Ways to Flourish In An Overgrown Garden

1. Be consumer-centric

When he bought OK Rubber Welders in 1952, Les Schwab created The Les Schwab Tire Company. Les Schwab is today the second-largest independent tire retailer in America with 410 locations across eight Western states.

My wife recently needed an emergency tire repair. Our two-year old son was with her when she left the house and went to Les Schwab. She was greeted at her car by the assistant manager, who helped her get them in the store.

The staff took 45 minutes to work on the car because it was an emergency visit. After the tire was repaired, the assistant manager offered to drive my son and her home. All this without any extra cost.

Les founded his company around the motto “Our business is earning you trust.” The Les Schwab Tire Company has now secured our business for life by providing top-notch service. This story has been shared with many friends, neighbors, and colleagues.

Although it seems obvious that you should put your customers first, many retailers fail to implement this universally agreed upon principle.

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reported that Macy’s was the fifth-worst customer service retailer in 2014 with a score 76 from the American Customer Service Index. It’s not surprising that Macy’s reported a 4.3 percent sales decline last year and closed 68 stores. Macy’s is currently trimming the excess but closing the doors won’t be enough. Or, the retailer will have to make fundamental changes in the way it interacts and communicates with customers.

2. Own your differentiator.

While McDonald’s may have served billions of people, Wendy’s has a mission to create an army of believers. I’ve joined them. Brandon Rhoten (Wendy’s former vice-president of marketing) explored the marketing strategy behind Wendy’s fast-food chain at the 2017 WOMMA Conference.

Rhoten explained that the first step in understanding Wendy’s was to understand what differentiates Wendy’s from its competitors: one, they never freeze hamburger meat, and two, their ice-cream machines never fail.

This was the second step. We needed to leverage these two differentiators at each touchpoint while staying true to Wendy’s brand. McDonald’s misspoke on Black Friday and tweeted a broken message. Wendy’s quickly responded, and there were many likes, comments, and shares across the internet.

I’m not suggesting that retailers should criticize each other (unless it fits within your brand voice), but it is important to understand what distinguishes your brand from others.

The Sports Authority attempted to compete with Amazon, by stocking an inexhaustible product range in its stores and simultaneously cutting prices deeper and deeper into its margin. The Sports Authority shut down its operations in 2016 because of this bad decision. If the company had tried to compete with Amazon and offered something Amazon couldn’t, this could have drastically changed the fate of the once-mighty retailer.

Bringing It All Together

Sephora, REI, and Flight Club all work hard to offer a unique shopping experience that is consumer-centric. I have previously written about some of these efforts. These retailers, and others doing similar things, are showing positive year-over–year results despite the predictions of retail’s decline.

It shouldn’t be surprising that retail outlets have closed recently. Retail is overgrown and crowded. Consumers can help to prune out unnecessary retailers. Those who work to create a dynamic, consumer-centric experience will reap a bounty.

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Starbucks to Increase Worker Pay and Benefits due to the New Tax Bill

Starbucks today announced it will use some savings from the U.S. corporate tax cut to give domestic employees pay rises, stock, and other benefits totaling more than $250,000,000 for more than 150,000 employees. The plan includes the following:

  • All eligible U.S. hourly or salaried workers will be entitled to a second wage rise in April. This is on top of the annual increases they already received this fiscal.
  • Starbucks will offer additional stock grants to eligible employees in the U.S. on April 16 for full-time, part time, hourly, and salaried workers across all stores, support centers, and plants. All Starbucks retail employees will be eligible for a minimum $500 grant. Store managers will each receive $2,000 grants. Grants to plant and support center partners (non-retail) will vary depending upon annualized salary.
  • All eligible employees will have the option to receive a new employee and family sick leave benefit. This will allow partners to accumulate sick time based upon hours worked and then use it if they or a loved one need care. Starbucks has also increased its parental leave policy, offering non-birth parents up six weeks of paid time when they have a child.

These new offerings add to the $7 billion in capital Starbucks will use to construct and renovate U.S. stores, manufacturing plants, and technology platforms over the next five-years. Starbucks stated that it is committed to offering opportunities to thousands of Americans with disadvantaged backgrounds.

Total Retail’s Take: With the announcement, Starbucks joins Wal-Mart and Apple as well as Comcast, Comcast, American Airlines, and other companies in sharing tax savings with their employees. This is even better news for Starbucks employees who receive more generous wages and benefits than mass-market retailers and restaurants. Starbucks actually pays more than the minimum wage in every state. In the coming weeks, we will keep an eye on how the new tax bill impacts other retailers, particularly if they are using the savings for their employees.


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