Survival Strategies for Small Town Retailers in a Big Box World

Poster

Speaker:
Sherri Gahring
612-624-1708
sgahring@che.umn.edu

Kim Johnson

Seahee Lee

University of Minnesota

Ken Stone (1995) identified big box retailers as the single largest threat to the survival of small-town retailers. In order for small stores to be successful, Stone recommended specific strategies be implemented by retailers, however, he did not conduct research to determine the success of his recommendations. Therefore, the purpose of our research was to investigate whether small independent retailers located in three communities were implementing any of the marketing, merchandising, customer service, or business operation strategies recommended by Stone.

Twenty-seven independent retailers were interviewed. Participants were asked to answer open-ended questions concerning their marketing, merchandising, customer service, and business operations. Data were analyzed using content analysis. All of the retailers knew some information about their customers (age, gender, income). Fifteen percent of the retailers carried the same or similar items at lower prices than the big box. Most of the participants had a liberal return policy, over half had a featured location for promotional items, and slightly over half shopped their competition regularly. Overall, these retailers carried similar products to big box but higher in quality and higher priced. Slightly over half of the participants indicated their sales associates were very knowledgeable about the merchandise. A third of the participants offered delivery/pick-up service. Few participants empowered their employees to solve customers' problems and less than half of the participants kept track of financial ratios regularly.

Findings from this pilot study are intended to provide baseline data for the Retail Analysis and Development Program being implemented by University of Minnesota Extension Regional Extension Educators.

Stone, K.E. (1995. Competing with the retail giants: How to survive in the new retail landscape. New York, NY: John Wiley & Sons Inc.