Tune Up Your Business Machine
The tried-and-true business model for selling plants is gone. What questions do you need to ask yourself to rev up your garden center for success?
October 18, 2011
Hi, this is your friend Sid. I’m writing this from my home office, which sits at the top of a hill. Every once in a while when I’m here at my desk, I hear an old car or truck chugging violently and moving ever so slowly up that hill.
Having owned a clunker a time or two in my lifetime, I imagine the owner is just hoping it doesn’t break down before reaching the top of the hill – as if the problems that are creating the chugging are not going to still be there when it gets to level ground.
This is similar to what I see happening with small businesses during these “uphill” times. Many business engines are in need of an overhaul, yet the owners are hoping to chug along long enough to make it to a better economy where more sales will once again mask the under-the-hood problems.
Most of these businesses have been held together over the years with baling wire and bubble gum. After priming, pulling and yet another jump-start, they sputter to life, possibly for the last spring. They’re kept from squeaking with the equivalent of WD-40 – one more good sale or a supplier that gives them terms.
Prep For An Overhaul
In the past owners have taken pride in what they built from scratch with guts, grit, determination, elbow grease and no debt to a fault. But the tune has changed recently as everyone searches for answers for the same questions. It’s time for that tune-up or rebuild. Take a look at these questions and see if yours are similar. Then take a look at my answers and think about what you should do about them.
Q: How can we get more people through the doors?
A: This is the wrong focus. The question that should be asked first is, “How do we keep our customers coming back?” Every one that doesn’t come back has to be replaced by a new one before any growth can occur.
So, why aren’t customers coming back? I’ve found two answers to this question. The first is that the weather was bad the past three springs in the majority of areas. The “fair-weather” friends just didn’t come out. The business is made up of a lot of those.
Second, the reason new customers don’t come is often because the marketing message (not the media) is not attracting them. Low prices, discounts, and coupons do not and will not convince people of the value of buying what they have not already decided to buy.
Q: Will young new homeowners shop anywhere but in chain and box stores they grew up with?
A: They won’t if garden centers don’t learn how to communicate with them in new ways to help them see real value in plants and gardening. Younger people have different media habits than older people do. This is not new. It’s called the Generation Gap. Admit it. Get over it.
Word of mouth, direct mail and signs were all the media that existed in the world for a long time. Then televisions and radios came along and marketers learned how to use those media (although it took longer than anyone still in business now remembers).
Now there are new forms of media. Anyone who ignores social media is systematically cutting off a growing percentage of the population they are not communicating with. The new media are not the same as broadcast media and must be used in new ways. As it becomes increasingly more effective for others, laggards and the ignorant will suffer. They’ll be missing communication with a growing share of the market that others will already be connected to and engaged with.
Q: Is this healthy-eating, veggie, organic trend a fad or a long-term trend?
A: It doesn’t matter. You don’t get to choose, so ride this and every other wave as long and hard as you can. You’ll get good at it and make it a part of your DNA, or it will end and you’ll get out.
Q: Will any bank be willing to refinance my operating line of credit?
A: Figure out how to operate without an operating loan. That means subscribing to and following the Merchant Advantage Mantra: Don’t buy what you can’t sell before you have to pay for it.
Q: Should I change my product mix to offer products such as food and ready-to-go containers?
A: If you want to sell the same stuff to the same people the same way, and you can’t sell enough to make ends meet given your present obligations to debt and staffing, something will have to change. You must figure out how to stay in business with a downsized sales volume or find new things to sell to your old customers.
Q: Should I just walk away from the business and start over?
A: It depends on the severity of your situation and what options you have. Many businesses I encounter have dwindling working capital and have depleted their equity. Their one option remaining is to get help to run their business correctly based on knowledge of sound principles and solid plans of action.
But too many people have too much pride and won’t seek help even if it’s the last choice before walking away. Walking away from financial and employment obligations would be embarrassing and the last thing you’d ever do. But not doing so may just delay the inevitable and inflict even more pain and suffering on yourself and others. The cost of ignorance is greater than the cost of good help.
These questions and answers are far from inspiring if you’re chugging along with a clunker, but they are real questions. The “get real” answers may be coming at you. Are you ready for them?
Sid Raisch is founder of Horticultural Advantage, a consulting firm to independent garden centers and Service Provider to The Garden Center Group. He has created the Advantage Development System to help client companies increase effectiveness to earn greater profits. For more, visit AdvantageDevelopmentSystem.com, call 888-339-7456 or eMail firstname.lastname@example.org.