People will only shop local if it is in their immediate best interests to do so.
That’s human nature. No amount of guilt, persuasion and appealing to the greater good will convince anyone to spend money with a business that is rude, providing an inferior product or not interested in giving their local customers a great experience. This is especially the case in local retail.
Although local consumers shop in the city and larger regional centres when drawn there by kids sport, education, work etc. (plugging these leaks is another story), in a country town one of the major reasons people leave town to shop is when they don’t get the quality, choice, service and respect they expect and deserve. This is fundamentally in the control of the business owner.
There are numerous examples of country retailers who do well, despite the perceived hindrances that other, less successful businesses, use as excuses for not being successful.
For example, I hear all the time that, ‘the people in this town just don’t care about supporting local business.’
That’s not true. They do care…but that care will only go so far.
They don’t care enough that they’ll let the business get away with out of date or out of fashion stock. They don’t care enough to continue spending money with a business that does the same things now as they did 30 years ago, or 10 or even 5! They don’t care enough to allow owners and staff to get away with not smiling at them when they walk in the door, or owners berating staff in front of customers or arguing in the main street with another business owner.
How many country consumers reading this are nodding their heads right now?
People in the city can simply go elsewhere when a business they find isn’t up to scratch. Why should country consumers be denied this? Do country businesses have a god given right to local custom, simply because they are local?
If locals aren’t supporting your business ask yourself why. It probably is more than simply that they don’t care. Do you really think if you were offering something amazing word wouldn’t spread in town? We all know how quickly word gets around in our communities!
Then there is the problem of country consumers who aren’t happy with what their local shop is offering but don’t want to see an alternative open up because they don’t want to see the local shop owner (who’s business they complain about all the time) go out of business.
In country towns, business owners who offer respect, something remarkable and of value, don’t fear more local competition, they revel in it because they know it will help their business.
Competition can do a number of things. It can make you improve your offering. It can provide choice for consumers and if they aren’t up to it, yes, it can put under performing businesses out of business.
But think beyond the individual business owner and think of the community. If theirs is an anchor business, that would keep people spending in the rest of town if it was run well, then the whole community is suffering from its lack of performance.*
However, small town businesses that work together to keep spending local and grow the pie do better than businesses that cut each other’s throat to get more of a small pie. After visiting many towns and talking to successful business owners and unsuccessful ones I have concluded that competition encourages active passionate owners to improve their business and jaded, tired owners to complain.
Let me give you an example. I was told a story, by a young community leader, about a group of wine industry representatives from several different countries who were visiting India. The size of India’s wine market is only about 9 million litres (as comparison, Australia with a population only 2% that of India’s is about 4.5million litres.)
The Indian high commissioner wondered and asked the delegation from places like France, Australia, New Zealand and the US why it was they were all competiting over 9 million litres of wine? Surely, it made more sense to collaborate and increase the size of the market? If it was increased to 18 million litres or more, there would be more for all, wouldn’t there?
The same applies for country towns. Why be afraid of competition? Embrace it! The consumer is less likely to travel to a regional centre to shop if the standard and choice available at home is of a high quality. This is less likely to be the case if there is only one operator in town.
Don’t believe the numbers would stack up? Let’s look at a real world example.
Toodyay has a green grocer AND an independent locally owned supermarket selling vegetables. Consumers can also choose to travel only 24 km to a larger town with two large chain supermarkets and a fruit and veg market, or they can choose to shop for food in Toodyay.
Not only is the supermarket expanding its operations but the local grocer is very profitable. How can this be?
The answer lies in the ability of the grocer to lift the bar in terms of quality, price, service and shopping experience.
The thriving green grocer outsells the supermarket but in doing so, it actually helps the supermarket. How so?
Because of the choice available to local consumers, they don’t bother driving to the Coles and Woolworths stores in Northam. They can get quality, affordable fruit and veg from the grocer and while in town, their other grocery items from the supermarket.
By plugging the leak of fruit and veg dollars from Toodyay by providing a high quality product, great service at a good price, the grocer increases the total size of potential spend by locals in Toodyay.
Even though the owner of the supermarket may not realise it, the grocer and the butcher and baker help to keep people in Toodyay and not leave to do all their shopping in Northam.
The biggest mistake he could make is to try and kill off his local competition in these areas. It would kill his business too.
So here are some starter principles for a thriving retail sector in your town.
- If locals aren’t supporting local businesses, don’t apportion blame, ask why and see what local businesses can do to improve the local offering before coming up with excuses.
- Don’t be afraid of competitors. They keep you on your toes and help you improve your offering. They can also help to keep more people from leaving town to shop by giving people choice.
- Work with other businesses and especially your competitors, to increase the size of the spend in your town. Co-ordinate a “think local” campaign through your chamber of commerce or your local Living Communities group.
- If any businesses aren’t performing – even competitors, try and help them. Give them some tips on what has worked for you. Bring retail marketing experts to town if there are no locals who can do the job. Workshop with business owners to come up with ideas and offer guidance and help.
- Remember, you can lead a horse to water etc. If underperforming businesses are happier complaining about their situation rather than solving it, move on and focus on what is best for the community.
- You don’t have a god given right to the local consumers spend. You have to earn it too.
As I’ve always said though. Maintaining a healthy economy is a mutual responsibility. My next post will be on the responsibility of local consumers to support local businesses and think local.
*A great example of this is the debacle of the Bridgetown (WA) supermarket that was run so badly just about everyone HAD to shop in the nearby town of Manjimup. There was literally no stock on the shelves in Bridgetown.
The result was other businesses in the main street were going under. The whole retail sector of Bridgetown was under threat. Luckily the problem seems to have been solved with a new supermarket owner.
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