Seasoned retailer offers lesson for the New Year

Guest commentary by Jeff Cooksey, buyer for Altum's Horticultural Center & Landscape.

After months and months of talks with a national grocery store chain, it was about to happen. The owners were going to sell the property that the garden center and landscape design business sits upon.

The current location was a state-of-the-art garden center in its heyday. The building became iconic to the Indianapolis area because of its vastness: It was the dreamwork of the founder, who made sure it had an education center, an indoor cafe, an outdoor patio, a tropical plant conservatory, a children’s playground and amenities for customers that had not been seen in the Indianapolis area ever before.

It was built in the mid 1980’s when everything was “super-sized.” Sprawling on 23 acres, it reigned in daily inefficiencies because it was so spread out. The retail center sat up front by the road, the receiving area sat mid-property and the landscape division was on the furthest acreage in the back of the property. Beautiful, yes, but a logistical nightmare. The land this garden center sits on has a huge price tag as well: not only in property taxes, but with the monthly mortgage payment, too.

After years of working with The Garden Center Group and their professional consultants, we were doing everything in our power to become profitable. We managed expenses, had excellent gross margins, product turns and GMROI’s (gross margin return on investment). Everything we were doing internally was working. But when you came to the final line of the balance sheet and plugged in “rent” and “property tax,” it ate up any profits that we had worked so diligently for. This became an annual disappointment, not only for the owner, but for the employees who had put all they could into making each season profitable.

The news that the grocery store was going to buy our property was exhilarating for us all. We knew if we could get onto a smaller, more efficient piece of property, we could be profitable and not have to “bust our brains out” for empty coffers at the end of each fiscal year. We began our marketing campaign to share all of this wonderful news with our customers and the two surrounding communities that provide most of our customer base. Our marketing firm developed a micro-site (www.alwaysgroundbreaking.com) from our existing website (www.altums.com) to give customers the most up-to-date information regarding our pending move and what was happening on that new piece of property. The respected Indiana Business Journal as well as the town and city papers printed news releases about the pending sale of the property. And so the buzz began…

As the 2010 spring season at the garden center budded, we quickly realized that customers thought we were going out of business, not simply moving to a new location. Regardless of how much information we submitted to the press, daily questions of “When are you closing?” and “When is your big moving sale?” became almost irritating.

We had our marketing company incorporate a “Moving” theme to our postcards and newsletters to try to put the questions to rest and focus on where our new location would be and what it would provide to our shoppers. A very high percentage of our customers did not make purchases because they were expecting things to be at discount moving prices, even though the move was not scheduled until July. Everything was supposed to be on sale in their opinion, and if it wasn't when they came in April or May, they were asking for discounts. The pillaging mindset had begun.

Finally June came and we hosted our planned Moving Sale and our inventory was shopped down to nothing by our bargain hunting shoppers. Then—guess what? The grocery store sent word that there was going to be a delay for a multitude of reasons, so we pushed our moving date from July 4th weekend to Labor Day weekend. We then re-stocked the sales floor appropriately for that time of year and continued battling the perception that we were going to close.

Unfortunately, our proper inventory levels for July on a 23-acre spread do appear as if there is little or nothing to shop from. Battling those rumors was tough at that time of year. We began yet another campaign to let our customers in on the delay of the move, and let them know Labor Day weekend would be our anticipated opening at the new location. Everyone coming into the store by then still wanted discounts galore. Fall mum season came and went with pumpkins, cornstalks, colorful nursery stock and changing-leaf-colored trees with still no move.

We now were literally in boxes, packing and ready to move in a couple weeks. Then again, the national grocery store sent word in the 11th hour that they were NOT going to be making the land purchase after all. Our long road of negotiations for a prosperous new site, which lasted for several years, had come to an abrupt end. The owner was heartbroken, but with grace and professionalism led us with a firm demeanor full-throttle ahead. We have just finished up our 2010 Christmas season at our still-existing location of 15 years now. Yes, all 23 acres are covered in snow and we now look toward another spring in our same location.

What I have learned from this experience (and please note: this is my personal opinion) is that sometimes you can dole out TMI, "TOO MUCH INFORMATION." Our intent was completely honorable. We wanted to embrace our customers and let them feel the excitement we all felt, as our dream was taking shape. We live it every day. This is our home away from home and our dream, not the customers. Customers really don't care about this kind of stuff: They just want to know where they need to go, to get what they want, when they want it.

I would simply caution other retailers about sharing too much emotion with your customer base. Separate what you feel and what they NEED to know before putting it in print. We pride ourselves on building relationships with our customers, however every good relationship has permissible boundaries. I believe that as long as we continue to provide excellent service, product and trust with integrity to our customers, they will shop our company, regardless of where we are located.

We have a very long history of doing just that. We have taken a pledge that should we have the opportunity to make a move again, the only thing we are going to do is send a change of address card to everyone involved once the move has taken place!