Retailer of Distinction: Aikenhead’s Home Improvement Warehouse
Reason: Merchandising
‘Stack it high and watch it fly,’ is the merchandising philosophy of Aikenhead’s Home Improvement Warehouse, according to President Stephen Bebis.
The warehouse-style retailer opened a massive, 138,000-square-foot store in suburban Toronto last April. Two more outlets are under construction and scheduled to open this fall.
‘We buy in truckload quantities and merchandise the goods in a warehouse format,’ Bebis says.
‘It’s not very labor-intensive,’ he says. ‘Goods come right off the truck and go right on the rack. It’s not fancy, but it’s effective.’
‘We buy direct from the manufacturer, offer excellent service and make the distribution process as efficient as possible. We then take those savings and pass them on to the consumer.’
‘Consumers today are looking for value. They shop around for that, as you can tell by the amount of cross-border shopping. But they will shop locally, if you provide them value.’
Q. In what order of importance do you place the following categories: merchandising, trade and supplier relations, product innovation, customer service, advertising, database marketing and staff relations?
A. Customer service, merchandising, trade and supplier relations, staff relations, advertising, product innovation and database marketing.
Without customers, you don’t have a business. In our company, every decision we make is based on whether the customer will accept it. If it’s right for our customers, it will be right for Aikenhead’s.
As far as advertising is concerned, the customer is the best advertising you have. If only more companies invested heavily in customer service, they could cut their ad budgets pretty significantly.
Q. From where do you get your inspiration?
A. Every time I see a customer come in the store and buy a product, I don’t look at it as a sale, I see it as a vote of confidence. And I guess that inspires me to do more for them.
There are some retailers who have inspired me – such as The Home Depot in the u.s., Walmart and Toys R Us – these are all retailers who believe in service and quality.
Q. In your opinion, what have been the most startling changes in retail over the past couple of years?
A. Other than Aikenhead’s, there’s not much that’s startling out there.
Q. What trends can you see on the horizon that will most affect your business?
A. I think ‘cocooning’ will continue to grow. People are establishing offices at home. And people are going to be spending a lot more money improving their home. We’re in the right business for the future.
Q. What qualities does one need to stay ahead of the pack?
A. A focussed vision, meaning focus on the customer, and develop a complete strategic plan around the customer, not around the bottom line, or some extraneous object.
Too many companies say ‘we need to make 35%,’ instead of saying, ‘we need to have satisfied customers, what do we do to make satisfied customers?’ If companies would pay attention to making their customers satisfied, the bottom line would come.
The first thing that companies do when they have a financial problem is say ‘let’s cut people, let’s cut payroll,’ instead of saying, ‘let’s cut expenses, let’s cut overhead, let’s find a way to do things better.’ I think a lot of companies start out with good intentions, and then they end up blowing it.
We could sell razor blades in our store, we could sell panty hose, we have that much traffic, but we don’t. We stay focussed on what our business is, and we don’t waver from that.
Q. How do you stay on top of your concept?
A. We evaluate it daily and monthly. It’s a constant review. We have management meetings on a monthly basis. We review the complete business plan – how we’re doing, how we could get better. We’re never overconfident. We have our own research based on the customer surveys, and we have systems that analyze the numbers.
Q. Tell us how the recession has affected your business .
A. I’m sure it’s had some effect, but we’ve only been open since April and we haven’t suffered too much. Sales have been way beyond our expectations.
We are also recession-resistant in our business because people are still going to work on their homes. And really, I think retailers that focus on the customer are retailers that will be successful in the ’90s.
