High and Dry
Getting a handle on the dry goods segment of the store is key to a retailer's bottom line.
Many years ago, when my partnership was in a period of flux, I made one of the smartest decisions of my retail career. I took over responsibility for the dry goods—we like to call it deadstock, as opposed to livestock. It had been the purview of an outgoing partner, and I felt I could do a better job than he had. It also appealed to my sense of order and organization, and I knew that what for many people would be deadly dull would give me great satisfaction.
It is, in fact, no surprise that many retail chains have given up on livestock altogether. Livestock is subject to disease and death, and it takes up absurd amounts of man-hours. In a world of bottom-line decisions, the profit motive demands that as little space and time as possible be devoted to that which our business actually revolves around: animals.
That my store has not gone that route speaks to our very different reason for being. We actually like animals and want to work with them. That said, day in and day out, the overwhelming money key on our register is dry goods, both in gross dollars and in percentage of profits. It behooves me, as owner, to pay as much attention as possible to that key—it is what allows everything else to go forward.
So, for the past 15 years or so, I have been the deadstock buyer for my store. I have learned a thing or two in that time. Much of what I have learned has come out of the mouths of company reps, inadvertently. For instance, my rep from my favorite company was in the other day, taking returns, placing an order and showing me new products. This is a company for which I have a deep and abiding respect, and I take its latest lines and innovations seriously. But every once in a while, even it comes up with a clunker. On this day, it was an unattractive, unnatural-looking, gimmicky product that did not offer a single benefit to the pet or owner. I didn’t say anything. I just looked at my rep, raised my eyebrow and rolled my eyes. “Owen, it’s my job; I have to show these things to you!” he sputtered, and we both laughed.
What I am getting at here is that you need to take a critical and proactive role in deciding what ends up on your shelves. Your customers depend on your good sense and experience, and they need to trust you.
I recently overheard one customer telling another: “This place doesn’t have a single iguana leash. There must be something wrong with those leashes.” That is our belief, and it was a joy to hear someone unprompted evince that level of trust in us. What they didn’t say was, “Let’s go elsewhere for a leash.” They got it: if my store doesn’t sell it, it’s not worth buying. That’s the reputation I aim for. Sometimes I succeed.
A wholesaler recently revealed what had been happening before she took over inventory for her business. The company had previously let manufacturer reps do its ordering and stocking. She was quickly overrun with sluggish inventory that she didn’t want, but for which she had to pay—and it nearly bankrupted her business. I have had many a rep try to do the same for me. I view that practice as letting a fox into your henhouse. Think about the rep’s motivation: the more he can jam onto your shelves, the more his own profits go up. And you will be stuck with a lot of redundant, slow-selling, and often bad products stuffing up your shelves.
Here’s another gem I recently learned from a rep speaking out-of-school. I was talking with him about a product from a few years ago that ended up being a disaster. It was a line of aquatic plants given a shelf-friendly package scheme that, in the end, had a ridiculously high die-off rate. I complained that the product had clearly not been properly tested before being introduced to the marketplace. He admitted to me that many manufacturers would rather do minimal testing and get the product on the market as soon as possible than have the product well-tested and truly market-ready. Why? They are in constant fear that being second on the market will garner them an inferior market share.
Frankly, that floored me. That philosophy puts the onus of responsibility on those of us on the front line, the retailers. The buying public rarely thinks to get upset with manufacturers. They expect us to handle whatever problems their purchase might bring to them, and I don’t blame them. I now have a new level of cynicism for new products, and I take it upon myself to approach each new offering with a critical eye. If it doesn’t make sense to you, you probably shouldn’t carry it.
Yet another rep recently admitted something to me that seemed obvious for years, but which, whenever I asked, was stridently denied by rep after rep after rep. I have always wondered how online retailers and box stores can so often beat me so badly on prices. I can battle that by offering a level of service and expertise that they can’t; plus, I have everything on hand, so my customers can walk out educated and ready to go. Still, it has bugged me, especially when reps have assured me over and over that I am getting the very best prices available. Well, of course, we aren’t. And one rep finally admitted this obvious truth. After all, if you are spending $100 a month on a product line, and a box store is spending $100,000 a month, they should be getting a better deal. But what it also means is that the prices that independent pet specialty retailers pay are, in fact, a little more negotiable than a lot of our suppliers are often willing to admit.
Of course, you will have to give a little as part of this equation. For instance, target a product with which you do well, and offer a commitment to an even greater volume on it if you can get a better price. Keep in mind that you cannot do this across the board. This kind of negotiation has to be specific and targeted, and it requires that you honor the commitments you make. But you might be surprised at the results.
The point of all this is: pay attention to your dry goods. They are the most profitable thing you sell. Focus in on a strong line of products that you can believe in, avoid redundancy, and be willing to negotiate on the products most important to you. Keep your shelves fastidiously stocked, and pay attention to what moves and what doesn’t.
Oh, and one more thing, and this is something I need to remember myself: keep those shelves dusted. That is all.
Owen Maercks has enjoyed being immersed in the world of professional herpetoculture for nearly 30 years. His store, the East Bay Vivarium in Berkeley, Calif., is one of the oldest and largest herptile specialty stores in the U.S.