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The world economy is in a tizzy. I don’t know if tizzy is even the right word. Tail spin might be better but complete surprise would probably be the unanimous feeling. No one ever anticipated a world wide financial collapse. BUT despite all of the negative press, the world is still turning and businesses are still doing business.

Last night I took my son in law and my grandchildren out to a new Japanese Steak House - the kind where they prepare the food in front of you. I wish someone would have told all the people who jammed the restaurant (and it was a big place) that we just had a financial melt down. I also wish someone had told the ski shop that was having their pre-season sale about a recession that’s coming because you couldn’t get near the parking lot.

It’s too bad no one told my friend, a real estate broker, that the world is in a crisis because she is finishing one of her best months in almost 3 years. By the way, no one told the children’s shop and the gift store owners that they shouldn’t have such big inventories… but of course they were pretty busy.

Lastly, what is wrong with Barron’s, the prestigious financial publication, whose headline on October 20th was “The Economy May Be Better Than You Think”? That’s a pleasant surprise but when you go to the article the headline gets better. It says, “Sorry Chicken Little”. Let’s get something straight. There is business out there to had and the sharp retailers are going to see sales increases that will become unprecedented?

Why?

Larger stores have all the classy high priced economists who are going to advise the buyers to cut back. Guess what? Their business will fall off. That’s sort of a self-fulfilling prophecy. Then the economist will take credit for their accurate predictions. Then we will see stores go out of business and they will blame the economy. Sorry, I will NOT buy it. Poor management puts stores out of business. Recessions reward the flexible and nimble. Last week on my weekly Question and Answer session on the Retailers Advantage, a store owner gave us the best line that all of us need to say. He said, “We choose to NOT participate in the recession”. Right on!

OK, so what do we do? It’s back to the basics. It’s really pretty simple.

1. We need to have merchandise that will make a customer want to buy. That generally falls in to two categories:  merchandise that wows the customer with that feeling I have to have it! Yes! the buyer did their job.  Great merchandise and the HOT item are the trump card to any recession. Don’t ever forget it.

   The other type of merchandise also creates a buying frenzy and that’s the merchandise that is such a great buy. You know that great buy we just can’t live without.  I was at the airport in Louisville and I walked past the PGA store. Right in front they had a table with some terrific buys. I was shocked when I saw the price of the sweater of only $9.99. I quickly tried it on and it was mine. Of course the only employee that was there suggested another sweater that was $39.99. I bought it.
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   Look at it like the classic bell shaped curve. It’s the merchandise at the ends of the curve that people talk about. There are some great buys available today because vendors are more willing to negotiate due to the fear factor. Trust me, there will be some very shrewd vendors as well who aren’t panicking.  

2. We need to have promotions, do window displays, have contests, and present our merchandise that people TALK ABOUT! Businesses are built on word of mouth advertising, but if you want word of mouth advertising, give people something to talk about. People talk about what’s different–what makes your business special, unusual, or a skill that you do that no one else does? Are you the first, the only, the best at something?  People talk about that. You don’t have to give the store away to bring people into the store. The key to having your existing customer come back rests with the Art of The Friendly Reminder. I have seen stores have huge increases just by requiring their employees to call customers on the phone. The key is to just leave a message on their answering machine. That is putting a different twist to marketing.

The last basic point I want to share is that it is our job to maximize every customer who walks through the front door. That means we work as hard as possible to sell every customer. That’s impossible I know but if we change our attitude that everyone who walks through your front door has the potential to buy, it makes it easier to sell more. However, just selling one item to one customer is NOT good enough. We make money when we are selling multiple items to the same customer. That only occurs when someone suggests another item. It does not take place when someone says to a customer, “Is that it for today?” or “Did you find everything you were looking for?” or ” Is there anything else you need” Those terms have never sold a thing.

I believe the glass is half full. I believe we are about to observe an unprecedented period of growth. It will take a while to get started but it will. When Warren Buffet says to buy. I BELIEVE HIM. After all, he owns some of the best retailers in the country. Let’s not forget that he loves the retail business and knows how to make it work.

Just remember, even on the darkest of nights we can still see stars. Who will be the next retail star that is reading this column? Is it YOU?