It?s a fact. There are less independently owned small retail stores today than there were 20 years ago. In some industries, the difference is dramatic. Independent clothing stores are at about 20% of what they were just 15 years ago.

WHY?

Think about what it took to run a successful retail store 20 years ago?.

You had to be there, in the town.

People needed to know you were there

It helped if you were not a convicted felon.

That was about it. You could concentrate on inventory, being friendly with your customers, and enjoying the ride.

You got the business because you were the only choice available. If a part took 3 weeks to get here?..the customer waited.

Then the Big Box Stores entered the picture.

Now something was different. Now the consumer has choices. Now we have competition. The game has changed.

So the Big Box Stores are the problem, Right? No.

But we could still survive because we had better quality products, and we serviced what we sold. Right? So we could hum along doing well (at least most of us).

And then the Internet came. Now we?re not the only game in town...any town.

So the Internet is the problem, right? No.

?So, Claude...what IS the problem, & what can be done about it??

I suspect the answer I give will make a few retailers angry. I will lose a subscriber or two over this. I don?t care. You pay me to give you real answers...not answers that make us feel good.

I am a Marketing Guru, specializing in the small retail Niche. One of my main Mentors is Bill Glazer. He is also a retail Guru specializing in a different niche. He just sent me a letter answering this question. It hit me like a ton of bricks. Here you are

The difference between small independent retail, and most other businesses?

There is very little ?churn?? in retail. I mean the owners themselves. Most of my readers have been in retail for 20 years or longer. Few people enter the retail trade every year, and few people leave. Many ?Brick & Mortar? businesses are like that.

Now here?s why that?s bad?. We do our business the same way we did 20-30 years ago. We are doing business as if nothing has changed.

We are selling the same way we did 20 years ago...but people aren?t buying the same way they did 20 years ago.

Every year, retailers are running the same sales, advertising the same way, offering the same selection?...but the buyer has moved on. They are getting used to a new way of buying.

For example, have you noticed that many companies now have some sort of ?Club? you join? You get a high end credit card an you??re in the ?Platinum club?. You are in the ?book of the month club?, etc. Many businesses call their customers ?Members?. Why?

Because more people are shopping at big box stores and on the internet. The local hardware store isn?t the place to gather, drink coffee, and gossip with the other town folk anymore.

People still crave belonging?.they want to be part of something. It?s in our DNA.

So ?virtual communities? are replacing real ones. It?s a slow process, and one I?m not looking forward to either. But that?s the trend.

If you can offer your customers a ?preferred Membership Card?, they get the feeling that they are part of a select group. There is even a little snob appeal thrown in for good measure.

McDonalds calls their customers ?Guests?. Smart. It changes the way the company looks at the customer and the way the customer looks at McDonalds.

Preferred membership cards, work....so do repeated mailings to your customers. A customer newsletter is useful, it maintains the bond we share even after the sale.

How do you thrive in the shadow of Wal-Mart? Offer what they can?t. Build product packages that can?t be shopped. Give value building product demonstrations (pointing to a product and saying ?There it is? is not a demonstration. )

When was the last time you were at Wal-mart, and a clerk had a complete knowledge of what they sold? When was the last time someone (besides your doctor) asked you a series of questions to be able to make a recommendation...one that perfectly fit your needs? When was the last time someone sent you a gift after you bought from them?

These are all things you can do...to build an impenetrable force field around your customers...so they wouldn?t even think about going anywhere else.

?But Claude...what about that darn internet??

Well? Do you have a website? Why not? You can go to www.godaddy.com and register your website name for under $10 a year, and host a site for about $5 a month. Just go to www.sweeperstoreonline.com to see my local website. You?ll notice that my website is bland, amateurish, and you can?t order from it. But it consistently generates $2,000-$4,000 a month in high end sales. People print out the page on the product they are interested in, and bring it into the store with them. The sales volume goes up almost every month from our little website.

We also have a commerce website at www.sweeperstore.com. We sell mostly vacuum cleaner bags & belts (and a few parts). This website generates about $20,000 a month in sales...at about a 25% net profit.

Of course, I have several websites for my seminar & speaking business.

It?s shamefully easy to get your local website listed on every local search engine. Just go to www.google.com to submit your website.

At the Las Vegas event, I heard a vacuum cleaner dealer complain that customers weren?t loyal to him. How sad.

My question would have been (if his statement was directed at me) ?What have you done for your customer that is so awe inspiring, that you deserve their loyalty??

See? You have to act first. You have to earn your customer?s loyalty & trust before they give it to you. You don?t get it just because you are local.

That?s just the way it works.

Back to the internet?. I predict that in the next 5 years or so??.. Half of your sales will be orders on the internet, or at least generated from the internet.

These sales are inexpensive to generate (advertising on the internet, or getting internet listings, is cheaper than local print advertising), and the orders can be filled by cheap, semi-trained labor (your brother-in-law will have a use after all). You will still have your retail store. You will still profit from a local location?...but you need to have an internet option for your customers.

Amazingly, there are still retailers who fight this. As little as 10 years ago, I heard someone at a seminar say out loud ?Anyone who buys from the internet should be shot!??.and nobody laughed.

Guys, it?s 2008. I know, I?m as surprised as anyone. But the future is here.

I?m working on a seminar on how to profit from internet use as a retailer...but that?s a year off or so.

You can complain about that new fangled internet...or you can embrace this media & profit from it. It?s your choice.