I am often accused of elitism in the
sense that some of what I espouse in my writing seems appropriate only for
high-end golf shops. I plead guilty. Custom ball programs, retail sales training
seminars and birthday cards from the staff, are all top tier concepts that
attempt to show how service and good retail programs can be differentiators. This
“white paper” will be more generic in scope but more poignant in focus. I want
to talk about why some shops fail or decide to fail in a retail sense and
define to some extent that failure. Any such conversation demands definition
also as to what type retail operation is in fact being attempted. Golf and its
stat counters – AGM, Data Tech, PGA, etc., generally categorize golf retail
into the following:
A.
Public B. Private C. Resort
D. Off-course
It is easy to decipher your shop in
these terms but perhaps not so easy would be to classify yourself in more
general retail terms. Are you looking to provide with the space, staff and
inventory you have devoted to retail, 1) A specialty store 2) A convenience
store or 3) A super store?
It is easy to pigeon-hole your shop as
Public or Semi-Private but perhaps not so easy to lump yourself in the
self-service convenience store bracket, especially after just coming from a
meeting where the purchase of a launch monitor was discussed for the range. It
is important to determine exactly what you want from your shop in terms of
image and profit before making some of the following pertinent marketing
decisions:
·
Amount of service
–
o
Self-service
o
Limited service
o
Full service
·
Product assortment
o
Life-style, boutique
o
Logo driven
o
Limited to needs
of the game
·
Price decisions
o
High markup, low
volume
o
Low markup on
higher volume
o
High-low pricing –
full retail plus sales and promotions
o
Every-day low
pricing
Only after one has seriously dealt with
these issues and defined what they really expect their shop to represent can
one judge success or failure.
According to an AGM member survey the
following table is probably a fairly accurate gauge:
2010
|
PRIVATE
|
PUBLIC
|
RESORT
|
OFFCOURSE
|
RETAIL $/ROUND
|
$17.65
|
$9.97
|
$28.40
|
N/A
|
GROSS
PROFIT
|
30.30%
|
30.70%
|
43.20%
|
38.30
|
Let’s suppose you have determined you
are at a public facility that only wants the shop to be a successful
convenience store. You have limited staff and budget, you have limited your product
assortment to golf essentials and have priced the inventory you do have very
aggressively so as to be super competitive. If this is what and who you have
decided you are content to be, then realize also that you obviously cannot
judge your success or failure against $10.00/round and 30.7% profit margin. What
you could be weighing against your savings in time and effort at the retail
level is whether that limitation has affected your facility’s image enough to
reduce rounds and their revenues. In other words you would be back at the
fundamental golf profitability issue of total dollars per round.
Now let’s assume you have decided to not
abandon retail and do want to understand the difference between success and
failure. Sometimes the important decisions start with knowing what not to do. Often
the following issues need to be addressed:
Lack
of empathetic (level five) leadership
Jim Collins in his book “Good to Great” introduced the
concept of “level five leadership” as someone
who blends genuine personal humility with intense professional will.
Lack
of understanding of the target market
Know your demographics and assume a love of the game.
Lack
of skilled sales staff
Set the bar high concerning service expectations at
hiring and then on an on-going basis train salesmanship
Lack
of product knowledge
Use vendors to help educate staff as to product
knowledge. There is nothing more telling than staff who not only don’t talk
about products in inventory but truly don’t know how.
Lack
of service culture
If you are - or hire a level five leader you will have a service
culture.
Lack
of proper inventory levels
Inventory levels that make your space “well
merchandised but not over inventoried” give you the best chance for retail success.
It is like being on second base with no outs.
All of these points have been discussed
in previous entries and are worthy of repeating as they are the heart and soul
of retail. There is also nothing so constant as change – what was great
leadership and knowledge of target markets five years ago did not involve
today’s technology and internet. Product knowledge had nothing to do with polyester.
People and planning still make for successful retail, but not with yesterday’s skill
sets and not without thinking outside the box regardless of your facility’s
stature. Future installments will detail
more closely some of these points in as non-elitist way as possible. I thought
this white paper approach important because all pertinent determinations regarding
identity and realistic goals should be seen as the primary exercise.
