Skip to content
Previous article
Now Reading:
Great Independents Can’t Be Beat
Next article

Great Independents Can’t Be Beat

Over the past twenty-five years, independent dealers have shown amazing resilience. They have thrived despite dire predictions about their demise due to the expansion of big box stores, followed by the online shopping onslaught. In many cases, they ended up watching corporate competitors come and go. Let’s analyze some of the reasons why.

Community Integration

Established independents have natural advantages. They are part of the fabric of their communities. The owner might coach the local hockey team, volunteer at their child’s school, or organize community charity events. Locals also know that profits will be re-circulated in the community, benefitting all that live there.

Employee Stability and Local Relations

Employees in independent stores tend to be longer serving and more established and secure than their corporate cousins. They skew older, which means there is less turnover as well as greater stability and predictability for customers. Independents have also forged strong relations with local contractors and builders that are difficult for new corporate players to break.

Importance of Personal Relationships

In large urban centres, sheer traffic and relative anonymity benefit the large-surface corporate stores. But outside large cities, retail customers and contractors put high value on personal relationships and service regardless of market.

Evolving Product Lines and Business Strategies

Strong independents have often evolved their product lines through years of trial and error. Customer preferences, competitive landscapes, vendor relationships, and ongoing analysis of product turns and profitability has helped them define their business and fine-tune their category emphasis and assortments. They have also made choices that suit their own personalities and interests, which ensures their continued passion for their businesses. This contrasts with corporate stores, whose need is consistency in support of their purchasing commitments, logistics, and marketing programs.

Thoughtful Investments

Independent dealers tend to be more cautious by nature. When making improvements to their store, they are spending their own money and making sure they are spending it on the right things. Their stores are more likely to be appropriately sized for their specific market, whereas corporate stores are often built to a fixed footprint for reasons of efficiency.

Long-Term Focus

Corporate decision-makers typically have a shorter-term view than the independent dealer. Their goals may be to maximize volume through a distribution centre or to open a promised number of new locations in a tight timeframe because of commitments to shareholders. Pressure to open new stores on a schedule can cause chains to settle for suboptimal locations.

Sustainable Growth

During periods of rapid expansion, corporations build robust support departments dedicated to perfecting all aspects of construction, merchandising, and operations. They invest heavily in inventory and staffing at the store level. This can give them a leg up on their independent competitors, but the advantage is often short-lived. Once expansion is complete, these extra resources become an unsustainable overhead expense.

Less Outside Pressure

Corporate chains tend to have less patience when new stores underperform. They start to cut staff and reduce inventory to get closer to their budgeted bottom lines. This creates a downward spiral that leads to lower service levels and out-of-stock items, which further erodes sales and the store’s reputation in the community. Independents don’t have the same outside pressures for short-term results.

Buying Group Strength

Buying groups that serve the independents have evolved and grown to neutralize the purchasing power of the large chains. They strive to keep their operating costs low by utilizing third-party support services on an as-needed basis. They also organize networking events and work with industry associations to help dealers learn from each other.

When you combine the natural advantages independents have in their own communities with the neutralizing benefits of their buying group associations, it should come as no surprise that independents have survived and thrived through the many challenges of the last few decades.

Leave a comment

Your email address will not be published..

Cart Close

Your cart is currently empty.

Start Shopping
Select options Close