Know: ‘timing is everything.’

smile, do not open a shop.”
The three success factors in retailing used to be “location, loca-
tion, location.” With the advent of the Internet, physical location is
less important. Millions of people buy books from Amazon.com
without knowing the company’s physical location. All that is needed
is an Internet address.
Companies need to solidify their relationships with their ven-
dors. A company should form a vendor council that meets a few
times a year. The vendors should be encouraged to critique the com-
pany’s performance and make suggestions. The company needs to
send its experts to visit and help vendors improve their business prac-
tices. The company should learn from its best vendors and inform
other vendors of best practices. And the top-performing vendors de-
serve recognition and better terms.
Today’s retailers must adopt new practices to survive in the bru-
tal marketplace. First, retailers need to spend more time in learning
who their customers are. They should give their customers a club
card and capture information in their customer databases. By analyz-
ing customer purchases, they will know which ones buy a lot of wine
or fish or ice cream, and can then announce and run special events
for these customer segments.
Second, retailers must invest in making retailing an experience
Retailers and Vendors
155

---

rather than a chore. Brand experience counts for much more than
brand image. By designing a distinctive brand experience, store own-
ers encourage people to come back more often, as has been demon-
strated by Barnes & Noble, Stew Leonard’s supermarket, and other
top retailers.
Third, retailers must move more aggressively into private brand-
ing. Private brands make more money for retailers than national
brands. At one time, store brands were considered inferior to na-
tional brands. Then along came President’s Choice introduced by
Canada’s Loblaws supermarkets, a store brand that exceeded the
quality of some national brands. The next step was for retailers to
carry two or three store brands pitched at different quality and price
levels. The main requirement was to create trust in the retailer and to
give good value to the customer.
Fourth, a retailer should open up a web site and offer customers
more information and opportunity for contact and dialogue.