This is the question I ask independent retailers.
Being famous for something is not just about having a point of difference. The brutal fact is that you might be different, but not in a way people care about.
Being famous for something means that your point of difference has connected with the needs, values and aspirations of the people in your market.
In a retail world that’s becoming more convenient, curated and multi-channel, it’s important to be able to answer this question and form your business strategy accordingly.
There are seismic shifts underway in retail. The doomsayers were wrong about the absolute death of bricks-and-mortar, but the landscape is changing more quickly than ever before.
Store formats are in a state of flux, logistics and infrastructure are at a crossroads, demographics are shifting towards a denser, more urbanised population. Consumers are searching out local, premium goods and curated experiences through a mixture of online and offline channels.
When it comes to purchasing, infrastructure, transport, logistics and marketing, independent retailers are at a disadvantage. They cannot leverage the immense market power or economies of scale available to national or multi-national conglomerates. But indies have advantages of their own they can exploit.
Agility, community and authenticity: The advantages of independents
Small and independent retailers are not encumbered by the vast networks, bureaucratic structures and many layers of management that large players can contain. A disruptive environment means moving quickly in the right direction is a distinct advantage.
For a major supermarket to re-organise a store format takes months or roll over from one year to the next. For an indy, the execution can be completed in a week.
One of my favourite independent retailers is Ritchies in Dromana on Victoria’s Mornington Peninsula. It sources amazing products and introduces visitors not just to a retailer, but to a whole network of independent businesses across the region – cheesemakers, mussel farmers and more.
It would be incredibly difficult for a major chain to duplicate this kind of authenticity. While big retailers spend a lot of time, money and effort creating a community around their products, outlets like Ritchies can connect with a desire for community simply by operating as an authentic part of one that already exists.
That’s what they are famous for. That’s why people will put the name of their business into search engines, and that’s why they’ll get in the car to go visit them, driving past many larger outlets on their way.
For independent retailers looking to plug into the advantages of a larger network, co-operatives like IGA and Foodworks can provide an avenue to do so. They offer collective procurement – not just buying from suppliers, but also store fit-outs, transport and logistics, store design and merchandise.
Tips for independent retailers to succeed
But whether as an independent retailer you join a co-operative network or go it alone, you should keep a careful eye on the trends and movements at both the small and big ends of town.
Other local independents can tell you a lot about customer preference, local culture, location and more. Sharing this information locally is one way to balance out the playing field with the big supermarkets.
Being aware of movements in nuts-and-bolts areas of retailing like logistics, store design, product range curation means you can effectively have the big end of town performing market research for you that you could never afford yourself.
Try to reverse-engineer the logic that you see behind choices made by major retailers. For instance, if they’re opening smaller stores, you might see that as increased competition for you.
But it doesn’t end there. Ask yourself why they’re opening smaller stores. What does this tell you about changing demographics? Is there an increase in apartment dwellings in the area?
If so, what does their strategy tell you about how they’re trying to meet the preferences of these consumers, and how can that be fed back into your own business strategy?
Good independent retailers take advantage of their agility. They have the upper hand when it comes to connecting with consumer desires for local, sustainable authentic products and experiences. And they keep their eyes and ears open so they can make sense of the movements in the broader retail space and make the right moves more quickly than their bigger, slower competitors.
Craig Padoa is country manager of Wanzl Australia.