Have we seen this challenge before?
“David, there is nothing new under the sun.”
And with that brief message, my mentor Carl, shared the first lesson about this challenging issue.
I am very fortunate to have Carl as my mentor. Besides being blessed with remarkable business acumen and a wealth of experience leading companies and divisions in the food, electronics, housewares and fashion industries, Carl possesses the most important traits that a mentor must have. He is a very giving person with a strong desire to share, better others and educate.
Carl went on to explain that in the 1940’s and 1950’s, the food industry experienced the very same issues that these houseware companies are going through now. When his mother shopped at the local grocer, he made the decision about what brands she could be purchasing. Choices were limited. Yet, less than a generation when his wife shopped, she was the one who chose the brands.
What had occurred in the intervening years was a change in how food was sold. The grocer of the past was replaced by the retailer. This new brand of retailer stopped being a merchant and became more of a landlord. In reality, he was selling space and his “tenants” were the products that he sold. Those who paid more for their position and location received more favorable space.
To compete, the supermarket owner had to leverage a different kind of appeal, one of better selection and lower price. Their key measure was the return on investment against cost per square foot. Their goal was to stock the floor with products that gave them the best return.
There were some exceptions and those retailers although new at what they were doing, learned about these exceptions very quickly. There were certain items that, even if they didn’t meet the ROI criteria, still had to be carried in the store. If these staples were not in the store, the consumer would have to go to another store. If the consumer did, the storeowner risked the possibility that the consumer would begin to shop in another place for not only those staples but for other items as well.
Sounds familiar, huh? A large store model replacing the mom and pop stores and more items competing for the attention of the consumer. The retailer controls the space and influences price and margins. Customers flock to these stores for convenience and better price.
So the first lesson then was that there is historical precedence to this dramatic change. In our next post, we’ll learn about the methods that Carl used to meet this challenge in the very same industry that our housewares executives are working.
Explore posts in the same categories: Leadership, Sales, Strategic Plans, StrategyTags: Change, consolidation, food, Housewares, industry, Leadership, Management, Strategy
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Strategy Insight 
March 20, 2009 at 3:36 pm
Right on, David. This is what I talk about. How can you think differently about where you are, what you have, who your target audience is (or can be) and how you can create value that is seen as relevant and a MUST HAVE by your current and potential audience? How can you think in an integrative way about what web 2.0 apps give us to position and make more visible what we have to offer? How can we think differently about not only who we are today vis a vis our clients but how else can we be seen by them that will make them think about us first or in a highly connective way?
“There’s nothing new under the sun.”? Perhaps that’s because there’s nothing new happening in the interiors of the way people are thinking about themselves, their businesses, their target audience and their marketplace. Even creative inventor types can get stuck in a “rut of creativity”. I know that sounds almost like an oxymoron but all of us get stuck in loops of thinking which therefore limit our ability to shift and realign ourselves with the vast potential for success that is out there. We end up “knowing too much” about our area of expertise or industry and find ourselves viewing everything through the same lens. I’ve certainly held myself hostage in that way at least once or twice during the time I’ve owned my business. Just as our eyesight changes and every once in a while we need to get new glasses or contacts to see things more clearly, we need to shift our minds to see things through a new, mental lens to achieve clarity and fresh insight for possibilities and to remain contemporary and relevant for our times. I know I have…How about you?
More later.
March 20, 2009 at 4:10 pm
What’s really neat about this process that we have undertaken is that we’re bringing in different orientations about a singular challenge. My working assumption is that this dialogue will give us a much more holistic and well-rounded approach to addressing it.
So it seems appropriate to let you know a little more about Karla so that you can see the lens through which she is viewing the challenge. Karla is an executive coach and her particular expertise is helping others look at their challenges and develop a new way of approaching them. You can learn more about her by checking out her site http://www.shiftinggears.biz/