Retail Stores Best Quotes

As an old-time small-town merchant, I can tell you that nobody has more love for the heyday of the smalltown retailing era than I do. That’s one of the reasons we chose to put our little Wal-Mart museum on the square in Bentonville. It’s in the old Walton’s Five and Dime building, and it tries to capture a little bit of the old dime store feel. But I can also tell you this: if we had gotten smug about our early success, and said, “Well, we’re the best merchant in town,” and just kept doing everything exactly the way we were doing it, somebody else would have come along and given our customers what they wanted, and we would be out of business today.

In the copy he brought to Kathryn Dalzell, he had underlined one particular passage in which Walton described borrowing the best ideas of his competitors. Bezos’s point was that every company in retail stands on the shoulders of the giants that came before it.

And frankly the people who seem to best understand that we are creatures of love and desire, not thoughts, are the current giant tech companies of the world. Think about how Apple exists with a temple-like space (tell me their retail stores don't feel so "set apart" from the ordinary retail design that it doesn't immediately conjure up sacred feelings) where you go to sacrifice (enormously large portions of your money) to obtain that which you are looking for - connection, meaning and depth. People stand in line all night, some even camping out on the sidewalk, for the latest device that offers those implicitly understood benefits. This phone can, and will, be more than a phone. I think it's even fair to say that Apple is a religion with Steve Jobs as a priest (who has become a venerated secular saint after his death), mediating between man and God to give us what we want. Connection. Power. God-like knowledge of good and evil. And we take the phone, and we crouch and bend over. Usually with heads bowed. Laser focused on something. Blocking out all around us. We are silent and solemn. Tending not to speak. And then we perform a certain behaviour over and over and over again. Sound familiar? Swipe.

me to be honest about his failings as well as his strengths. She is one of the smartest and most grounded people I have ever met. “There are parts of his life and personality that are extremely messy, and that’s the truth,” she told me early on. “You shouldn’t whitewash it. He’s good at spin, but he also has a remarkable story, and I’d like to see that it’s all told truthfully.” I leave it to the reader to assess whether I have succeeded in this mission. I’m sure there are players in this drama who will remember some of the events differently or think that I sometimes got trapped in Jobs’s distortion field. As happened when I wrote a book about Henry Kissinger, which in some ways was good preparation for this project, I found that people had such strong positive and negative emotions about Jobs that the Rashomon effect was often evident. But I’ve done the best I can to balance conflicting accounts fairly and be transparent about the sources I used. This is a book about the roller-coaster life and searingly intense personality of a creative entrepreneur whose passion for perfection and ferocious drive revolutionized six industries: personal computers, animated movies, music, phones, tablet computing, and digital publishing. You might even add a seventh, retail stores, which Jobs did not quite revolutionize but did reimagine. In addition, he opened the way for a new market for digital content based on apps rather than just websites. Along the way he produced not only transforming products but also, on his second try, a lasting company, endowed with his DNA, that is filled with creative designers and daredevil engineers who could carry forward his vision. In August 2011, right before he stepped down as CEO, the enterprise he started in his parents’ garage became the world’s most valuable company. This is also, I hope, a book about innovation. At a time when the United States is seeking ways to sustain its innovative edge, and when societies around the world are trying to build creative digital-age economies, Jobs stands as the ultimate icon of inventiveness, imagination, and sustained innovation. He knew that the best way to create value in the twenty-first century was to connect creativity with technology, so he built a company where leaps of the imagination were combined with remarkable feats of engineering. He and his colleagues at Apple were able to think differently: They developed not merely modest product advances based on focus groups, but whole new devices and services that consumers did not yet know they needed. He was not a model boss or human being, tidily packaged for emulation. Driven by demons, he could drive those around him to fury and despair. But his personality and passions and products were all interrelated, just as Apple’s hardware and software tended to be, as if part of an integrated system. His tale is thus both instructive and cautionary, filled with lessons about innovation, character, leadership, and values.

Drinkers at social events will tell you they don’t need to drink. But, when the next bit of anxiety comes up, they grab another glass. Smokers will tell you they enjoy lighting up. They’ll tell you they feel better right after a cigarette. And nearly all of them will tell you they really want to quit—they’re just not quite ready yet. Workaholics will tell you they enjoy what they do, or at least feel a sense of purpose, while stretching themselves to the breaking point. They’ll tell you they have to do it. Some will even admit that it makes them feel important. They’ll promise to get control of their schedules… as soon as the next project is done. Compulsive shoppers love to hit the stores. They call it “stress management” or “retail therapy.” For a few hours, they’ll say, everything is perfect. After they get the goodies home, though, some will tell you they feel empty or even disgusted. They’d love a simpler life—but only if they first can buy the best of everything. People who misuse prescription drugs will tell you the pills ease their pain. The pain from a surgery or disease was so extreme that they got prescribed a medication, and soon they had to take more and more to keep the pain away. They’ll say they hate being constantly constipated and forgetting where they are, but it’s the only way they believe they can function and feel normal.

Of all organizations, it was oddly enough Wal-Mart that best recognized the complex nature of the circumstances, according to a case study from Harvard’s Kennedy School of Government. Briefed on what was developing, the giant discount retailer’s chief executive officer, Lee Scott, issued a simple edict. “This company will respond to the level of this disaster,” he was remembered to have said in a meeting with his upper management. “A lot of you are going to have to make decisions above your level. Make the best decision that you can with the information that’s available to you at the time, and, above all, do the right thing.” As one of the officers at the meeting later recalled, “That was it.” The edict was passed down to store managers and set the tone for how people were expected to react. On the most immediate level, Wal-Mart had 126 stores closed due to damage and power outages. Twenty thousand employees and their family members were displaced. The initial focus was on helping them. And within forty-eight hours, more than half of the damaged stores were up and running again. But according to one executive on the scene, as word of the disaster’s impact on the city’s population began filtering in from Wal-Mart employees on the ground, the priority shifted from reopening stores to “Oh, my God, what can we do to help these people?” Acting on their own authority, Wal-Mart’s store managers began distributing diapers, water, baby formula, and ice to residents. Where FEMA still hadn’t figured out how to requisition supplies, the managers fashioned crude paper-slip credit systems for first responders, providing them with food, sleeping bags, toiletries, and also, where available, rescue equipment like hatchets, ropes, and boots. The assistant manager of a Wal-Mart store engulfed by a thirty-foot storm surge ran a bulldozer through the store, loaded it with any items she could salvage, and gave them all away in the parking lot. When a local hospital told her it was running short of drugs, she went back in and broke into the store’s pharmacy—and was lauded by upper management for it.

The company even drew unlikely customers. From rural Arkansas, operating just five comically cheap-looking stores—a rounding error compared with the largest retailers—Sam Walton made his way to an IBM conference for retailers. While he shied away from investing anything in any emotional aspect of retailing, delivering the lowest prices meant mastering logistics and information. To one speaker at the conference, Abe Marks, modern retailing meant knowing exactly “how much merchandise is in the store? What’s selling and what’s not? What is to be ordered, marked down or replaced? . . . The more you turn your inventory, the less capital is required.” Altering his first impression, Marks found that Walton’s simpleton comportment masked his genius as a retailer, eventually calling him the “best utilizer of information that there’s ever been.” A little over two decades later, Sam Walton would become the richest man in America; he would attribute his competitive advantage to his investment in computing systems in his early days. The small-town merchant who expected that knowing his customers’ names or sponsoring the local Little League team would give him some enduring advantage simply didn’t understand the sport. American consumers, technocrats at heart, rewarded efficiency as reflected by the prices on the shelves, not the quaint sentiments of a friendly proprietor. To gain this efficiency, information systems were seen as vital.

The audience for Channel 28, the PBS station in Los Angeles, was demographically perfect for Trader Joe’s. In those days, however, PBS did not accept overt commercials. Alice had been quite active as a volunteer at the station. Through her contacts, we made arrangements to sponsor reruns of shows that tied to Trader Joe’s, such as the Julia Child shows, The Galloping Gourmet, and Barbara Wodehouse’s series on training dogs, which proved very effective! These reruns were not expensive compared with sponsoring first-runs and they had very good audiences. All we got was a “billboard” announcing that Trader Joe’s was sponsoring the show, but this was a cost-effective way of building our presence in the community. Another way we promoted ourselves on public TV was to “man the phones” during pledge drives. Our employees, led by Robin Guentert who was running advertising at that time (Robin became one of the most important members of store supervision after 1982, then President of Trader Joe’s in 2002), would show up en masse at the station. They loved being on TV, and we got the publicity. Promoting through Nonprofits Most retailers, when they’re approached by charities for donations, do their best to stiff-arm the would-be donees, or ask that a grueling series of requirements need to be met. In general they hate giving except to big, organized charities like United Way, because that way they escape being solicited by all sorts of uncomfortable pressure groups. At the very beginning of Trader Joe’s, however, we adopted a policy of using non-profit giving as an advertising and promotional tool. We established these policies: Never give cash to anyone. Never buy space in a program. That is money thrown away. Give freely, give generously, but only to nonprofits that are focused on the overeducated and underpaid. Any museum opening, any art gallery opening, any hospital auxiliary benefit, any college alumni gathering, the American Association of University Women, the Assistance League, any chamber orchestra benefit—their requests got a very warm welcome. But nothing for Little League, Pop Warner, et al.; that was not what Trader Joe’s was about.

Six key themes The real reset has gone much deeper and encompasses six key themes, all of which are linked: 1) The shift from a push system, based on producer dominance, oligopolistic competition, limited supply and restricted access, to a pull system driven by consumer dominance, near-perfect competition, perfect knowledge and ubiquitous access to goods. 2) The change from mass marketing, based on a few research and segmentation studies, to personalized marketing, based on individual customer data. 3) The realization that the e-commerce revolution and the communications revolution (social media, user reviews, influencers, etc.) has broken the traditional supply chain, with its multiple players – manufacturers, branded wholesalers and retailers – all supping from the margin cup and adding their mark-ups to prices, and replaced it with a shorter and more direct route to market. 5) The realization that the stores channel was not the only, or even best, way of moving goods from factories to consumers. Indeed, that it was inferior to the e-commerce channel in many respects as a pure goods-transmission mechanism. 6) That putting the consumer at the heart of the business model required seeing the different channels as the consumer saw them – not competing, but complementary to each other. 7) That based on this, the traditional model of the store, as a ‘warehouse’ piled high with stock and with just a narrow fringe of branding and customer service on top, was obsolete and that only a ruthless attention to the remaining added value of physical stores could ensure their continued relevance and survival.

The electronics effort faced even greater challenges. To launch that category, David Risher tapped a Dartmouth alum named Chris Payne who had previously worked on Amazon’s DVD store. Like Miller, Payne had to plead with suppliers—in this case, Asian consumer-electronics companies like Sony, Toshiba, and Samsung. He quickly hit a wall. The Japanese electronics giants viewed Internet sellers like Amazon as sketchy discounters. They also had big-box stores like Best Buy and Circuit City whispering in their ears and asking them to take a pass on Amazon. There were middlemen distributors, like Ingram Electronics, but they offered a limited selection. Bezos deployed Doerr to talk to Howard Stringer at Sony America, but he got nowhere. So Payne had to turn to the secondary distributors—jobbers that exist in an unsanctioned, though not illegal, gray market. Randy Miller, a retail finance director who came to Amazon from Eddie Bauer, equates it to buying from the trunk of someone’s car in a dark alley. “It was not a sustainable inventory model, but if you are desperate to have particular products on your site or in your store, you do what you need to do,” he says. Buying through these murky middlemen got Payne and his fledgling electronics team part of the way toward stocking Amazon’s virtual shelves. But Bezos was unimpressed with the selection and grumpily compared it to shopping in a Russian supermarket during the years of Communist rule. It would take Amazon years to generate enough sales to sway the big Asian brands. For now, the electronics store was sparely furnished. Bezos had asked to see $100 million in electronics sales for the 1999 holiday season; Payne and his crew got about two-thirds of the way there. Amazon officially announced the new toy and electronics stores that summer, and in September, the company held a press event at the Sheraton in midtown Manhattan to promote the new categories. Someone had the idea that the tables in the conference room at the Sheraton should have piles of merchandise representing all the new categories, to reinforce the idea of broad selection. Bezos loved it, but when he walked into the room the night before the event, he threw a tantrum: he didn’t think the piles were large enough. “Do you want to hand this business to our competitors?” he barked into his cell phone at his underlings. “This is pathetic!” Harrison Miller, Chris Payne, and their colleagues fanned out that night across Manhattan to various stores, splurging on random products and stuffing them in the trunks of taxicabs. Miller spent a thousand dollars alone at a Toys “R” Us in Herald Square. Payne maxed out his personal credit card and had to call his wife in Seattle to tell her not to use the card for a few days. The piles of products were eventually large enough to satisfy Bezos, but the episode was an early warning. To satisfy customers and their own demanding boss during the upcoming holiday, Amazon executives were going to have to substitute artifice and improvisation for truly comprehensive selection.

Another thing you need to understand is what we now call the “core competencies” of your organization. What are we really good at? What do our customers pay us for? Why do they buy from us? In a competitive, nonmonopolistic market—and that is what the world has become—there is absolutely no reason why a customer should buy from you rather from your competitor. None. He pays you because you give him something that is of value to him. What is it that we get paid for? You may think this is a simple question. It is not. I have been working with some of the world’s biggest manufacturers, producers, and distributors of packaged consumer goods. All of you use their products, even in Slovenia. They have two kinds of customers. One, of course, is the retailer. The other is the housewife. What do they pay for? I have been asking this question for a year now. I do not know how many companies in the world make soap, but there are a great many. And I can’t tell the difference between one kind of soap or the other. And why does the buyer have a preference—and a strong one, by the way? What does it do for her? Why is she willing to buy from one manufacturer when on the same shelves in the United States or in Japan or in Germany they are soaps from other companies? She usually does not even look at them. She reaches out for that one soap. Why? What does she see? What does she want? Try to work on this. Incidentally, the best way to find out is to ask customers not by questionnaire but by sitting down with them and finding out. The most successful retailer I know in the world is not one of the big retail chains. It is somebody in Ireland, a small country about the size of Slovenia. This particular company is next door to Great Britain with its very powerful supermarkets, and all of them are also in Ireland. And yet this little company has maybe 60 percent of the sandwich market. What do they do? Well, the answer is that the boss spends two days each week in one of his stores serving customers, from the meat counter to the checkout counter, and is the one who puts stuff into bags and carries it out to the shoppers’ automobiles. He knows what the customers pay for. But let me go back to the beginning: The place to start managing is not in the plant, and it is not in the office. You start with managing yourself by finding out your own strengths, by placing yourself where your strengths can produce results and making sure that you set the right example (which is basically what ethics is all about), and by placing your people where their strengths can produce results.

This shows that price is imperative for all FMCG retailers. They must always do two things well: Be genuinely price competitive on the top 100 best-selling products where the shopper is most likely to make direct comparisons. Perpetually make efforts to manage their price image and must consider the impact of all marketing actions on that image. Wal-Mart still advertise their price Rollbacks even though everyone has known for decades they are good value.

Okay, a couple more: I happen to believe that economic success lies in the hands of SMEs, small and medium-sized enterprises. Four books I give away on SMEs are: George Whalin’s Retail Superstars: Inside the Twenty-five Best Independent Stores in America (Favorite line: “Be the best, it’s the only market that’s not crowded.”), Bo Burlingham’s Small Giants: Companies That Choose to Be Great Instead of Big, Bill Taylor’s Simply Brilliant: How Great Organizations Do Ordinary Things in Extraordinary Ways, and Hermann Simon’s Hidden Champions of the Twenty-first Century: The Success Strategies of Unknown World Market Leaders. I love giving books away! I bet,

gaining shelfspace has become a more strategic challenge for manufacturers. Shelfspace has to be won by planning product offerings to satisfy not just consumers’ needs but also the retailers’ objectives. Because the retailer is overwhelmed with offerings that claim to have consumer appeal – that is now a given – it is in being seen to best meet the retailers’ needs that has become the battleground. Store management wants to increase category sales, improve average margins, provide a good range to shoppers and perhaps offer exclusive products, all the while looking to increase operational efficiency and reduce inventory costs by minimising the number of lines stocked and the workload involved in getting products on the shelf. Manufacturers now have to win shelfspace by working through these complex and sometimes conflicting needs.

Promotion stocks came to the retailer ahead of the rest of the market. Also, they usually got an extra lot even after the end of the promotion Newly launched products came to the retailer first. The customers got more choice, faster, leading to favourable word-of-mouth publicity Local display and consumer sampling budgets were always directed liberally at the retailer Vendors ensured that no slow moving inventory was stuck in the retailer’s stores; they wanted nothing to choke the pipeline The retailer also received the best in-class margin from the distributor If some items were in short supply, the vendor would ensure the retailer was the last one to go out of stock In effect, the consumers found more products, fresher stocks and more promotions in the retailer’s stores compared to the general market. This wasn’t something actively created by either the vendors or the retailer, but was a byproduct of good trading practices. Just one move based on a trading community insight— everyone has less money in the bank than needed — hurled the retailer into a virtuous growth cycle, with all the vendors pushing in one direction, with them. Most people in the business would not give a second look at changing these trading practices. If the payment norm is eight days why modify it? Surely the wholesalers, too, know what they’re letting themselves in for? And the vast volumes offered by organised retail should offset the stress of extending credit. Isn’t that how it works? One retailer managed to peep behind the curtain of wholesaler business practices and understood what a boon more money in the bank was to the trade. And look at the gains they reaped for this seemingly insignificant insight!

One of the best types of groups you can join is a buying group. Retailers organize as a group to buy from manufacturers.

Of all organizations, it was oddly enough Wal-Mart that best recognized the complex nature of the circumstances, according to a case study from Harvard’s Kennedy School of Government. Briefed on what was developing, the giant discount retailer’s chief executive officer, Lee Scott, issued a simple edict. “This company will respond to the level of this disaster,” he was remembered to have said in a meeting with his upper management. “A lot of you are going to have to make decisions above your level. Make the best decision that you can with the information that’s available to you at the time, and, above all, do the right thing.” As one of the officers at the meeting later recalled, “That was it.” The edict was passed down to store managers and set the tone for how people were expected to react. On

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Q: Where did the dog go when he lost his tail?  A: The retail store.

Those retailers are simply fated to live in the inflexible world of racks and aisles, where products must obey the uncompromising physics of atoms, not bits. One of those unfortunate rules of corporeal matter is that it cannot transcend time and space. Obviously, a physical item can be in only one place at any given time. For instance, a can of tuna cannot exist simultaneously in multiple categories, even though the interests and browsing paths of each shopper might suggest many: “fish,” “canned food,” “sandwich makings,” “low-fat,” “on sale,” “best-selling,” “back-to-school,” “under $2,” and so on. A physical store cannot be reconfigured on the fly to cater to each customer based on his or her particular interests.

As you may know, shrinkage, or unaccounted-for inventory loss—theft, in other words—is one of the biggest enemies of profitability in the retail business. So in 1980, we decided the best way to control the problem was to share with the associates any profitability the company gained by reducing it. If a store holds shrinkage below the company’s goal, every associate in that store gets a bonus that could be as much as $200. This is sort of competitive information, but I can tell you that our shrinkage percentage is about half the industry average

Owning a small business is like getting married. You're in it for the long haul, for better, for worse, for richer, for poorer. And like marriage, there's a learning curve. You learn it's best to keep your mouth shut more often than not.

Walton described borrowing the best ideas of his competitors. Bezos’s point was that every company in retail stands on the shoulders of the giants that came before it.

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Being an unstore meant, in Bezos’s view, that Amazon was not bound by the traditional rules of retail. It had limitless shelf space and personalized itself for every customer. It allowed negative reviews in addition to positive ones, and it placed used products directly next to new ones so that customers could make informed choices. In Bezos’s eyes, Amazon offered both everyday low prices and great customer service. It was Walmart and Nordstrom’s. Being an unstore also meant that Amazon had to concern itself only with what was best for the customer. The conventions of the jewelry business allowed routine 100 or 200 percent markups, but, well, that just didn’t apply to Amazon. In that meeting, Bezos decreed that Amazon was not in retail, and therefore did not have to kowtow to retail. He suggested that Amazon could ignore the conventions of pricing in the jewelry business and envisioned customers buying a bracelet on the site for $1,200 and then going to get an appraisal and finding out from the local jeweler that the item was actually worth $2,000. “I know you’re retailers and I hired you because you are retailers,” Bezos said. “But I want you to understand that from this day forward, you are not bound by the old rules.

This focus on humans rather than money is best illustrated by the Apple store concept, which was the first to include the Genius Bar, a children’s play area and other features that critics thought were a waste of time. When the first Apple store designs were announced, Bloomberg reported: “(Steve) Jobs thinks he can do a better job than experienced retailers. Problem is, the numbers don’t add up. I give them two years before they’re turning out the lights on a very painful and expensive mistake.”15 However, after opening, it was obvious that the stores were engaging customers in an even more immersive, brand building experience. Eight years later, Apple’s New York store became the highest grossing retailer on Fifth Avenue.

This last question may seem innocuous, but think about it this way: In 2006, retail was booming. Sears was worth $14.3 billion, Target $38.2 billion, and Walmart a whopping $158 billion. Meanwhile, an upstart retailer named Amazon was at $17.5 billion. Now fast-forward a decade. What’s changed? Hard times hit Main Street. By 2017, Sears had lost 94 percent of its value, ending the decade worth $0.9 billion, before promptly going out of business. Target did better, finishing up at $55 billion. Walmart did the best, going up to $243.9 billion. But Amazon? The Everything Store closed out the era worth $700 billion (today $800 billion). And it’s a fairly safe bet that your life changed as a result.

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