Merchants get preview of changing marketplace
Local merchants gathered Thursday night in the State Room tohear an economist explain ways to co-exist with big-box merchants,such as Wal-Mart, Home Depot and Lowe’s.
Dr. Kenneth Stone, professor emeritus of economics at Iowa StateUniversity, gave merchants tips for survival and what to do whenfaced with competition from a big-box merchant.
Stone focused his presentation primarily on Home Depot andWal-Mart. Brookhaven is home to a Wal-Mart Supercenter, and HomeDepot is under construction on the west end of BrookwayBoulevard.
A wide range of area business owners and managers attended theseminar, including those in hardware, real estate and furniture, aswell as an electrician.
Attitude is everything, Stone said.
“Don’t engage them in a price war,” the professor warned ofbig-box merchants. If you do, a local merchant replied, “you’lllose.”
Stone said Home Depot had $71 billion in sales in 2004, placingsecond behind Wal-Mart, which had $280 billion in sales. Heencouraged area merchants to shop and learn the big-boxcompetitors.
“How are you going to compete if you don’t shop them?” heasked.
Home Depot has 1,515 stores in the United States, including 11in Mississippi.
Stone said the American economic system is a capitalistic one,and each business is allowed to do what they want.
“It’s hard to compete item for item,” he said.
Local businessman Tommy Smith, of T-Tommy’s T-Shirts and Caps,said, “Competition is good. It keeps the price down.”
Stone told merchants they needed to get back to basics byfocusing more on merchandising, customer service and sharpeningtheir pricing skills.
Ann and Lester Manning, of Tools and More, attended the seminarhoping to find out more about what’s going on in the town.
“Home Depot is not going to affect what we’re doing,” saidLester Manning, who went on to say that if the new store did havean impact it wouldn’t be much.
Stone suggested that merchants analyze their businesses anddetermine what type of competition they will face.
“Find a niche,” he said, by servicing the product and providingproducts the big-box stores don’t provide, such as replacementparts.
Many merchants who attended the seminar said most of what wassaid was things they already new, but hearing them again reinforcedthem.
Ed Norton and Randy Ratcliff, of Brookwood Gifts and Antiques,attended the seminar. He said many small businesses lack theresources to bring in outside experts on their own.
“Who can we hire to come in and teach us what to do?” askedNorton. “We came here to get educated.”
Norton expressed his appreciation to The DAILY LEADER forhosting the seminar, saying “I wish they could have had somethingsimilar 10 years ago.”
Guy Nix III, of new business All Electric, said big-box storesoften are given a leg up.
“We feel like we’re at a disadvantage,” he said. Nix also saidhe didn’t think it was fair to small businesses that big-box storesoften are given special economic incentives.