Indepependent retail businesses can succeed and thrive

Our unfriends at Reason Magazine (I say unfriends because they publish anti-transportation screeds with undue regularity) have a halfway decent piece about successful independent retail stores, in "Big Box Panic." Slate Magazine also had a story on this in terms of Starbucks not killing off the independent coffee shop, "Why Starbucks actually helps mom and pop coffeehouses."

The Reason article chalks up the success to "localization, customer care, and authenticity." But I think that the hidden agenda of the article is to denigrate legislation putting restrictions on chain stores, which is part of their general pro-extremely large business anti-government regulation agenda.

Further, the article misses the point I think, in determining why independent retail can be successful. It isn't just "localization, customer care, and authenticity" but a fully realized concept, and robust store operations systems. (Not to mention financing.)

Independent retailers (and restaurants) without fully realized concepts and weak operational skills and systems fail with great regularity.

I wrote about Store operations and systems in this blog entry last September, "Why ask why? Because," and since March I have been working up the pieces of a fully realized store concept. This is what I have so far:

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Principles for creating complete concepts/identity systems for retail businesses*
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• Understand the needs, preferences, habits, and aspirations of the target audience.
• Good design sells. It is a competitive advantage. Design is systems and processes, not just graphics.
• A disciplined, coherent approach leads to a unified and powerful brand presence.
• Create a distinct position and complete identity for your store/concept.
• Experience and study the competition and learn from their successes and failures.
• Understand traffic flow, the volume of business, and economic considerations of your location.
• The storefront is a mass communications medium that works 24/7 and can attract new customers, influence purchasing decisions, and increase sales.
• Logo and signage expresses the brand and builds on understanding the needs and habits of users in the environment.
• Exterior signage must consider both vehicular and pedestrian traffic.
• Design an interior space that is sustainable, durable, easy to maintain and clean, and is energy efficient.
• Consider the dimensions of space: visual, auditory, olfactory, tactile, and thermal.
• Understand the pyschological effect of light and lighting sources.
• Consider the needs of handicapped customers and those of different ages.
• The shelf is the most competitive marketing environment that exists.
• Align merchandising strategies with displays, advertising, and sales strategies.
• Create an experience and environment that makes it easy for customers to buy, and that inspires them to come back again and again.
• Create an environment that helps the sales force sell and makes it easy to complete a transaction.
• Align the quality and speed of service with the experience of the environment.
• Benchmark the quality and speed of service against the competition.
• Consider all operational needs so that the store delivers on the brand promise.
• Anticipate future growth. Measure, evaluate, change. Constantly ask: is the message clear?; is the content accessible?; is the experience positive?

* This table was built from the section on "creating touchpoints" from Designing Brand Identity (second edition) by Alina Wheeler

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Chains have many advantages in other ways, in terms of financing, in terms of negotiating master leases, in reaping build out allowances, in garnering financial incentives from localities, in things like financial engineering of store leases and trademark licensing, in demanding rebates from suppliers, etc.

And as the Claremont Institute points out in "Lattes at the Regulatory Cafe," chains have the money and the staff to deal with the often onerous regulatory requirements of municipalities. (I saw a similar article on this topic, about Alexandria, VA.) A sole proprietor doesn't have this luxury.

Still with a complete and robust store concept and identity system, topnotch store operational systems, and localization, customer care, and authenticity, independents can thrive.