Oct 31, 2003
Survivor: Mom-and-pop stores
Some small shops resist the force of big retailers
By Wayne T. Price
FLORIDA TODAY
Not long ago, Buck Buchanan of Merritt Island asked his daughter if she
could locate some small compression springs for his favorite La-Z-Boy chair.
The daughter went to nearby orange-and-white Home Depot for her 80-year-old
father's errand and was slightly shocked by two things.
The huge store, bragging thousands of items in stock, didn't carry the springs.
Even more surprising was the associate at Home Depot suggested she visit the
independently owned S.F. Travis Hardware in Cocoa Village.
Buchanan, a lifelong customer of the 118-year-old Travis hardware store, laughed
at that. He could have saved his daughter the trip.
"I've never gone to Travis looking for something that they didn't have," said
Buchanan, a former insurance-company owner.
Buchanan's experience is telling. While so-called big-box retailers -- also
known as "category-killers" -- continue to change the shopping landscape
for many of consumers, a few small, independent businesses have been able to
maintain a sustainable, if not healthy, market share.
As the holiday shopping season, expected to be one of the most competitive
in recent memory because of a struggling economy, nears, national retailers
are expected to heat up the marketplace with special sales and other inventory-clearing
strategies.
That's only going to increase the pressure on the shrinking number of mom-and-pop
operations that each years struggle from the massive competition put to them
by the likes of Wal-Mart, Home Depot, Lowe's, Walgreen and Staples.
Although it's difficult to pin down a true definition of what constitutes a "mom-and-pop" operation,
the U.S. Small Business Administration said there were approximately 22.9 million
small businesses in the United States in 2002. Those companies provide nearly
41 percent of all private sales in the country.
A look at how three Brevard County independent businesses -- S.F. Travis Hardware,
Cocoa; Meehans' Office Products, Melbourne; and Liggett Drugs, Rockledge --
show that one way to succeeded against the corporate Goliaths is to continually
stress a few Business 101 lessons.
For example, all three businesses fanatically stress developing relationships
with their customers and specialize in going the extra distance to provide
personalized service that is rare at many major retail operations.
And it's not done as a nostalgic throwback to a bygone era. They do it for
one simple reason: To stay in businesses against competitors that have thousands
of employees, sales that top the billion-dollar mark many times over and the
ability to offer steep discounts to customers.
"The small business must offer superior service," said Debbie Allen,
president of Allen & Associates Consulting Inc. in Tempe, Ariz. "That's
the only way they will be able to survive."
Godfrey Phillips, a nationally recognized small-business researcher, said businesses
like Travis, Meehans' and Liggett, are successful because their small size "allows
them to adapt quicker to changing business conditions."
"Those businesses are often more flexible than the big retailers," Phillips
said. "They have their ears to the ground and usually have a good sense
of what their customers want."
Part of being more flexible means providing services for customers they're
not likely to get elsewhere, a fact etched in the playbooks of local small-business
operators.
"If you order something from me by 2:30 p.m. today, it will be sitting in
your office tomorrow or whatever time you want it there," said Dennis Meehan,
co-owner of Meehans' Office Products.
Meehans' was a three-store operation a decade ago, with a commercial division
selling desks, chairs and other office accessories, and a retail division that
sold the smaller items likes pens, envelopes, paper clips, etc.
When large office-supply retailers like Office Depot and Staples entered the
scene with their huge inventories of supplies, it signaled a sea of change.
Meehans' retail side shrank, and two of the three stores closed.
"That really was a blow to our company," Meehan said, adding that it
wasn't only competition from Staples and Office Depot, but also Wal-Mart, Walgreen
and Sam's Club.
"Once that was over, we were able to analyze how we were doing business
and went after more niche business in particular areas that we concentrate on," Meehan
said.
James Nance, founder and senior partner with the Melbourne law firm of Nance
Cacciatore Duryea & Hamilton, quickly list numerous reasons why his firm
has always done business with Meehans'. He cites service, friendship and loyalty,
but also a dislike for the major retailers.
"I really resent them putting the little guy out of business," Nance
said. "But being friends with Meehans' and getting good service and good
prices that satisfy us is enough. It overwhelms what those concerns could ever
possibly offer us."
David Ray, owner of Liggett Drugs in Rockledge, strives for a similar one-on-one
relationship with his customers. He has owned the business for 33 years and,
in that time, has gotten to know his customers' medical conditions, stories
about their families and where they live.
"We know them on a first-name business," Ray said. "I'm beginning
to know the grandchildren on a first-name basis."
Ray, who said he fears mail-order drug suppliers more than he does the CVS
or Walgreen operations, is part of a growing nationwide group of independent
pharmacists joining together so they can negotiate with the same power as the
chain retailers.
The group has 70 members in Florida and 1,600 across the nation. In a few years,
he predicts the group will grow to 4,000.
"We can compete with them on prices because we can buy right," Ray
said.
Though some customers and business consultants say the chain retailers tend
to homogenize shopping and can be impersonal, they still have lessons to borrow
from.
Ironically, the 118-year-old Travis Hardware borrowed a key lesson from Sears,
once one of the top-selling chain retailers, said Mac Osborne, great-grandson
of hardware store founder Samuel Franklin Travis.
Travis speaks with a slight Southern twang, and the store still uses a freight
elevator with grinding gears and chains that probably are the oldest in the
county.
"Sears used to say 'Satisfaction guaranteed or your money back,' " Osborne
said. "That's the way our company operates. You're not going to leave here
unsatisfied. We're going to take care of you on a one-on-one basis. I'm either
going to beat you to death with service or find out why you're not happy."
Osborne, who hopes to see his 26-year-old daughter, Sally Osborne, take over
some day, also has a few tricks to ensure that his store's 28 employees know
their product.
Every few months he'll order whole sections of the store changed around. By
the time the employees finish lugging the different pieces of inventory to
another site at the store, they'll know that product fairly well, Osborne said.
That's why, on more than one occasion, he'll get a customer who was referred
to him by Lowe's or Home Depot.
"You can't buy that kind of advertising," Osborne said.
Travis flirted with the idea of opening another location in Viera several years
ago, but after running the figures, Osborne scotched the idea.
"The best I could come up with was 8,000 feet in a shopping center," Osborne
said. "We would have had to do $1 million a year just to break even. And
with only 8,000 square feet, what were we going to put down there to do that?"
The store does have a Web page, a homage to modern ways of doing business,
but Osborne doesn't sound too excited about it.
"We're on the Internet, but who cares? Pick up the phone and call us," he
said. "We'll bring it to you."
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