Experiential is that way to go in terms of marketing, and any business must think of the “END USER” and their needs as they seek sustainable profits through serving those needs in engaging ways.

This conversation has further validated the creation of my business that does just that, support and grow local businesses.

Thanks for the insight, it’s 2011 as I write this post and unfortunately things have gotten consistently worse for most businesses.

Rick

I just wanted to mention that the small guy or gal does not get a good discount if any on goods. They are usually not even offered overstock’s or closeouts because of the Costco’s & TJMaxx. But, remember, the small business owner’s are the ones who usually support the local fundraisers for your kids etc. Don’t even think of asking Costco or TJMaxx to do such a thing. Yet,the small business often participate in such an activity to watch people run to TJ’s for a deal.

Everyone should take a moment to consider the ethical standards such companies abide by. Walmart can be dirt cheap because of using the cheapest materials and cheapest labor. Try to find something made in the USA there. TJMaxx swoops in on a cheap wholesale buy when they are desperate to get rid of the goods.

Retail is a very competitive business. But, it has gotten out of control over the last 20 years. I drive down the main street of my town & remember when small retail use to thrive. Now I wonder if anyone will take the chance & open a business in the many vacant store fronts I see everyday. So, support your local small business. The big box stores don’t give a crap about you and your community.

As you say, economy of scale and purchasing power are valid concepts. I would go to the small store and buy the Lego bricks if I get better service and have a greater buying experience. But you shouldn’t feel obliged to run around all over the town to get all your stuff. Stores like Walmart has an important function that you could get plenty of cheap stuff in one place. I don’t think you shouldn’t describe this company as a villain.

As a side note, if you really want to have a special experience, take a trip to Denmark and buy Lego from the source! They have a special amusement park with Lego brick.

Costco and other big box general stores are certainly villains. Can’t think of a better term.
Costco gains economies of scale by cherry picking the best items that the 50 various small outfits in town carry.
For simplicity sake, let’s talk Legos. Costco will carry the two most popular sets. A small toy store would carry a nice variety of 8 different Lego sets. However, Costco has a lower price on the two most popular sets, and the small store loses 60% of their Lego sales. Little store can’t stay in business. Now, there are only two Lego sets in town.
One Costco / Walmart in town can put many different specialty stores out of business. Those little stores would have carried a large variety of products, even some local products. Once Costco / Walmart outprices small stores on the most popular items, entire industries wither away.
It would be nice to think small stores can survive on selection and service, but being outpriced eventually kills the small store. Economies of scale are great, but they lead to tiny selections of products that only.

As for Neal’s comment that that a small business needs to achieve economies of scale or fold, I disagree. The local merchant is never going to achieve the economies of scale of a big box merchant, but some local merchants will survive. The ones that will survive will be the ones that provide value in a way that the big box stores cannot. In some cases, the “value” will be convenience, in others it will be service, in still others it will be ambiance and atmosphere. There are always going to be people who will pay more money for the right reason.

The local merchants that can’t find and deliver that extra value will be in trouble, however, particularly when money is tight.

I went and bought my son a Lego(tm) at the local toy shop rather than a big box for just this reason. He likes the store, so do I, and the couple of extra bucks is not going to crush me. Well, maybe it will and i’ll be eating plain rice and beans for a while. Oh well, a small price to pay for doing our part. Toys was not on your list, though… Hmmm.

As for flowers, my wife’s birthday is coming up…
Thanks for the reminders (not about her BD), but about thinking about our fellow small biz owners.
TJ

But honestly, it isn’t a wonder for them to be really affected because all of us right now are really tight on budget and whether they’ll like it or not, the industry to where these florists belong is a business that people can obviously live without.