Comments on: Hoopla To Close at End of March

By: Charlie

Charlie — Fri, 05 Mar 2010 03:07:20 +0000

Noooo! If a toy store can’t make it in Decatur something is wrong! Now I have to shop for my gifts at Target??? I loved that place!!! This stinks!

By: SAACJack

SAACJack — Thu, 04 Mar 2010 20:23:24 +0000

Heliotrope is, IMO, a GREAT example of doing it right. The devil is figuring out what “it” is to do “it” right. There is very little impulse buying online, or should I say ADD-ON purchases,wherein you go in to the store for one thing and come out with three. In-store purchases also lend themselves to last minute type shoppers ( men customers, anyone?). And there is not shipping cost, as you leave with your purchase. There is a formulary in which you factor in a minute portion of every expense you have to cover ( rent, utilities, marketing, payroll, etc.) and, accordingly, each item you sell has its’portion of those expense to cover. For example, you sell a ten dollar item that costs you as the owner $3.50 at cost. Subtract the cost ($3.50) plus these other COGS (cost of goods sold), say $3.00, and you are left with $3.50 “profit”. If you sell other items on that SAME transactions, your costs of overhead are not repeated(within the same transaction), only the true cost of the items, so your margin of profitability is increased. Granted, this is an extreme simplification, but hopefully you see how it works, and why effective salespersons/owners are always suggesting other items, accessories etc. A good retailer knows the importance of a higher “average ticket”, or units per transaction. Heliotrope gets it and capitalizes on this by offering many wonderfully unique and affordable “treats” and that is why you leave with three things instead of one. The grocery store equivalent is seen with all the “goodies” surrounding the checkout. Even HOME DEPOT does that now around their registers.

Sorry for retail 101, but…I got skills.

By: karass

karass — Thu, 04 Mar 2010 20:01:30 +0000

Ok, I understand better. So it’s not just about where the shopper prefers to shop–in-store or on-line–but also the extra revenue that a brick and mortar box can generate through shelf space rental or spontaneous purchases. Maybe that’s what non-grocery stores need to try to emulate. Could they get their major brands to rent space too? Certainly they could try to affect spontaneous purchases but grocery stores have hunger and smell going for them. Those human elements probably entice more spontaneous purchases than just sight and greed do. Although Heliotrope does a great job of enticing ME–I often go in there just for fun because I am walking by and then come out with several items I never planned to buy. They have a formula that’s working and maybe could be applied elsewhere. (Unless we’re about to get a posting that they are closing too!)

I like the idea that on-line grocery stores may have just been too early in the tech curve. Would someone who knows what they’re doing please get a successful one up and running soon? It might be only second to good public schools in improving family life in Decatur.

By: Paula

Paula — Thu, 04 Mar 2010 19:42:13 +0000

I don’t know if this is the answer to the question, but I do know that the grocery business has one of the slimmest profit margins of any businesses – sometimes as low as 1%. On top of that, your modern chain grocery depends on major brands “renting” shelf space for additional revenue, which can’t really happen online (although I suppose they could purchase premium ad placement on a homepage…). Also, a big part of in-store marketing is encouraging spontaneous purchases, which probably wouldn’t happen quite as often online.

By: SAACJack

SAACJack — Thu, 04 Mar 2010 19:18:32 +0000

Many folks ( and I am an old retailer) often don’t know what they want until the run across it, especially for gifts. Online wedding registries have also impacted the need to go into the store to get the bride and groom something they wish. Clothing and many textile purchases…sheets/towels/ etc….most folks want to touch see feel. If you have kids, you know how important they feel it is to go to the toy store. So there will always be need for brick and mortar. The challenge comes in financially assessing how much “in person” business you need or can capture to offset the extremely high overhead of rental retail space, none of which is present with an on-line business (other than storage space).

Groceries: again folks employ their senses. I, too, loved PeaPod when I lived in Dallas, and found the goods I received as good or better than what I could pick out in person. But we are all acclimated to having myriad choices in fresh and canned goods, and stocking the right assortment to support consumer needs proved ultimately the death knell. I also think these services were ahead of the tech curve and suburban saturation that we now have with computers in almost every home.

This is an interesting discussion, no?

By: karass

karass — Thu, 04 Mar 2010 18:12:55 +0000

Hmm, re effect of Internet: I can’t figure this one out. Why hasn’t Internet grocery shopping ever taken off? I was a Webvan addict and gave its gift cards to new Moms and sick friends. All to no avail. Now, schlepping every 5-10 days to the grocery store with kids, wandering through the aisles, waiting on line to check out, loading the car up, and then unloading it, often in the rain, has got to be one of the biggest drags on a family’s time.

So I guess some folks just have to pick out their food in person or can’t even plan 2 hours ahead of time. Why isn’t that true for their purchase of other goods like toys, crafts, clothes? Until goods can be delivered by wireless instantaneously, don’t those same folks need a brick and mortar store? I guess the trick is to figure out what goods folks just must buy on short notice or have to browse in person.

By: SAACJack

SAACJack — Thu, 04 Mar 2010 16:36:49 +0000

I think one must REALLY be careful going into any retail effort whether in Decatur elsewhere, not only because of the economy but also as our shopping culture has changed with the Internet. If you don’t have a strongly executed business plan that matches well to your target market, your odds of success are EXTREMELY slim. Margins in food establishments are even slimmer. In a city well-saturated with many fine food choices already, anyone wishing to slice that pie even more thinly is really taking a huge risk.

By: Marla

Marla — Thu, 04 Mar 2010 15:27:55 +0000

I was in Taste yesterday – still open!