Could you use the Golden Triplet?

recent article in these columns discussed the response a small business has to take to compete effectively against the Amazon steamroller. It isn’t price certainly and it isn’t selection. The answer is customer experience and trust.

In the meantime I ran across another article with a different take. The title was particularly compelling. Its author called his theory the Golden Triplet of small business.

Now it’s one thing to read about theory but another matter to put it in to practice. I’ve been witness to a retailer doing exactly that, and who happens to be a CEDF client. I’m not going to name him to allow his business to stay confidential, although he’s very forthcoming and helpful to his industry colleagues and even competitors outside his market which includes locations in two of Connecticut’s wealthier communities.

You might think this makes his business easy but it actually means there’s more competition because he customers all have enough money to shop where they want and to demand the instant gratification of next-day online fulfillment, whether through Amazon or any other source that fills the order.

Here’s how he goes up against the giant.

First, my client epitomizes the idea of excellent face-to-face service emphasized by the article’s author. His staff are at your side and available when needed on the sales floor and they are knowledgeable about the products and genuinely happy to be of assistance. Naturally, they can’t always fulfill every request because there are limits to what a local store can carry. But they know the logical substitutes and they are willing to bring inventory from the other location on request. 

The second element of the Triplet is an online presence.  But it is just enough of an online effort to be in the race without exhausting precious resources trying to out-Amazon Amazon. What’s important to my client is to provide an adequate informational substitute for being in-store when the local customer can’t conveniently make it there– Maybe because of a snowstorm, or just because they are shopping off hours from home in pajamas. So he uses a product feed from an industry service to populate his website with a catalog of what he carries. But instead of trying to build a nationwide customer base and get beat every time by you know who, he offers local delivery in a manner that particularly appeals to his time-impoverished customers.

The third part of the Triplet is targeted volume but premium price. This means pricing your goods to recognize the value of the in-person, personal shopping assistance but never gouging your customer. The crucial point is too always generate enough gross profit to support the bricks and mortar that makes face-to-face service possible.

And as a sweetener, it helps that he has pretty decent selection too.

— Frederick Welk
CEDF Business Advisor

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