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Archive for March, 2009

Now Is The Time To Fire Them All

Recession numbers continue to be bleak.  Glimmers of hope are showing up with each week but clearly it will be a long haul. And you still have Bitter Betty or Silent Suzy working for you. Why?

My advice instead of cutting hours? Fire the lazy. Fire the quiet. Fire the shy. Sorry, you had your chance.

I was at one of the best restaurants in Hudson, NY, Mexican Radio yesterday for lunch.  We sat down, no one bothered to come over to say a word. No menus. Nothing. Yet two girls stood at the hostess station talking.  There were five tables with diners and us.

When the girl finally came over, she spoke so softly I hardly knew what she was saying.  She was as limp as the rag she used to wipe off the table next to us. She was memorable and not in a good way.

This type of employee is in every service business and retailer across the U.S.

Sales have been soft and we continue to let the neediest on our sales floor. It is killing you! Wake up!

I don’t care if she is your daughter’s best friend, your boyfriend’s mom, your husband, whatever. Customers are not willing to return if they have to put up with mediocre.

You are doing nobody any favors keeping them.  In fact, you are doing yourself a big disservice because the better employees will leave. You’ll end up with a culture of the dead, instead of a vibrant business.

Restaurants in particular are an event to go out. We expect the food to be great; that is a given. But when our desire to have a great experience is watered down by the lonely, quiet, introverted, we won’t be back.  And you can’t blame that on the recession.

Where does the leadership responsibilty come into this? Who hired them to start with and didn’t performance manage till now? You.  The only way to start over is to raise your own standards.

Give them a chance to change certainly. Give them training, absolutely.  But don’t give them shelter in the storm.

If you have to, fire them all and start again. I know those are bold words but they are what you’ll find in the book that started my business You Can Compete: Double Sales Without Discounting. Heck, I fired a guy on Christmas Eve because he had crossed the boundaries too much. And my sales increased.

Employees expect there to be standards and rewards but they also expect consequences. That’s what makes you money – a committed team.

Look around you today.  If you find your employee behind a rack or consistently behind the counter, they should be behind the 8-ball.

Take no prisoners – you are fighting for your retail life! Do everyone the courtesy of putting the right people in the right place.  Otherwise, your regulars will be looking for the door, when it should be your wimpy employees.

Women’s Apparel Sales Off Because Nothing Fits

An article in today’s WSJ by Rachel Dodes entitled, Neiman Presses Designers for Cuts, subtitled …Searching for ‘Value’ to Sway Full-Price Sales, covered how the Neiman Marcus buyers are convinced they must be able to show ‘value’ in their clothes.  Their buyers are telling designers to cut out pleats and save money to hit price points. I have news for them: value is not the real issue women’s apparel sales are so low; nothing fits anymore.

Years of going overseas have meant shave a bit here on the pattern and shave a bit there on consistency.  Who cares if the pattern varies one to the other as long as it looks OK on the hanger. Most sales clerks don’t wear the garments they sell so they aren’t telling the buyers. Well now is the time to change this women’s apparel retailers!

To find out if I was on base, I chatted with an audience member Patty. She told me about her recent shopping experience at an upscale women’s boutique going out of business in Waco, TX. She purchased a 6, an 8 and a size 10 pant. These were not cheap garments, they were the type found at Neiman Marcus.

Patty turned to me and said, “Do I look like a 10 to you?” OK guys, you know the right answer to that but it also was true, “No you don’t.” Patty is an attractive woman who I would think a size 6 would fit easily. She even tried on size 12s.

“Wouldn’t you think,” she started “that I should at least be able to pull the size 8’s on? I couldn’t even get them zipped!” And this is at the crux of what I think retailers should be working on during the recession. Women’s clothes don’t fit. It’s a trend that only got worse in the past five years; there is no consistency in the manufacturing.

Is the rise different? OK, but if she’s a 6, she should still be able to get a different cut of a size 6, not have to go two sizes higher to get it buttoned. A woman should never vary by more than one size to get a good fit.

It’s funny people always say guys are the ones who hate to shop yet we have the easiest fit. I can go into any store, high or low-end and pick up a shirt 15 ½ x 34 and it will fit, same with my pants and jacket sizes. Men’s clothes fit.

If a woman is a 6 and has to try on the 8, she’ll think, “I must’ve put on weight.” As Patty shared with me, “Buying clothes in front of a mirror makes you already down on yourself to begin with. If it doesn’t fit, my self-esteem goes under the rug.”

This is a HUGE issue women’s apparel retailers.

As more more manufacturing has gone overseas, the thought must have been we’ll flatter women and give them smaller sizes. And we really don’t have to cut it to fit, they’ll buy it anyway. Heck, women were buying shoes and not even wearing them. It still sold. Those days are gone for Neiman Marcus, Saks and all the others.

Patty was on a roll, “Hey I work. I make a good living. I want to look nice. I will spend money on clothing that I feel is worth it. When I feel I have to settle just for what fits, that’s just crap.”

I saw a video interview with Michael Kors on the New York Times website, “In this day it has to whistle Dixie if it’s going to go off the shelf.” But again, that is based on the belief that it is the fashion that will make the difference – the real issue appears to be women’s frustration with shopping.

A woman doesn’t want a roll of the dice when she picks up garments to try on. Since many stores have cut both personnel and training, no one is going to help her – she knows she’s all alone. She’s got to get undressed, try it on, go back out if it doesn’t fit, etc.

Patty went on, “You would think if you pay more money for it that you would get a truer fit. Wouldn’t you? That would be my expectation, but that’s where you get very frustrated.”

She continued, “If a salesperson knows how a garment fits on your body, then shopping’s fun – all you have to worry about is ‘Do I want it in green or black?’, not trying to get it to fit. I don’t remember the last time I had that experience.”

I asked Patty, “Well jackets aren’t so finicky right?” Patty had a story for me, “My husband and I were walking through Dillard’s and I saw a beautiful long black designer coat on sale from $600 to $173- it was a medium. Wouldn’t you think I’m a medium? Wouldn’t you think I’m a medium? Well I thought this coat was really pretty.

About that time my husband’s beeper went off and he had to go. I didn’t feel like staying. About an 1 1/2hr later he came home and asked, ‘Did you get the coat?’ and I told him, ‘No, we were having fun and I just didn’t feel like shopping once you left and I didn’t go back’. He turned to me with a smile on his face, ‘Well here you go.’ And he handed me the coat! He had gone back to Dillard’s and bought it for me.

Do you know what? It didn’t fit! I couldn’t even get my arms through it. And I’m a medium! It was cut like an extra small! A $600 coat in a medium didn’t fit. The media is full of stories saying ‘women don’t want expensive items anymore.’ No, it’s about being able to buy a medium or a 6 or an 8 or a 14 and know it will fit.

How are we supposed to be able to go shopping? You have to use more of your time and it becomes a chore. When it’s fun I’ll do it again.”

I asked her about legendary service store Nordstrom  – surely they are better. Oops.

Patty had a story there too, “ I went into Nordstrom’s in Dallas with $1000 for my professional suits, but I couldn’t find any suits. I’ve read about the Nordstrom way, but never gotten it. Anyways, I finally found this little girl and I said, ‘I’m a businesswoman I’m looking for clothes for work. I must be in the wrong department.’ She said, ‘No problem’ we walked over to a display and she said, ‘This will look darling on you.’ It was one of these tiny, tiny jackets with pencil legs. I said, ‘That would look great on you but a train wreck on me. I’m 55 yrs old. I don’t want to look like I’m 55 trying to look like 25.’

I would have thought that would be a slam-dunk for Nordstrom. I walked out without buying a thing and I haven’t been back.”

Women’s apparel retailers, now is the time to fix it for the Pattys of the world. This is the real opportunity to compete, not saving $25 here and there.

By the time we were finished with our chat we had a table full of women sharing similar stories. Notice it wasn’t about the discounts offered or retail price of things- it was a simple message: shopping isn’t fun anymore.

Fix that by buying better, developing an across-the-board consistency in sizes and train your sales crew about every garment, fit and how to work a dressing room and you’ll be able to entice this sought-after customer.  If you need help, contact me

Miss this opportunity and you’re toast -concentrating on saving a few bucks on pleats, rather than saving the entire category of women’s apparel.

Fear Feeds the Cable Beast – 5 Keys How To Manage

I found this quote from Blackstone Group CEO Stephen Schwarzman buried at the bottom of the article Blackstone’s CEO: ‘Keep Away’ From Real Estate by Aaron Elstein in yesterday’s Crain’s New York Business, “he suggested people turn off their televisions and pull the plug on their computers, saying that media and the Internet have made the crisis worse by giving everyone the same bad news and gossip simultaneously. “The business stories went on to the front page,” he said. “That is never a good thing. Business stories should always be on the business pages.

In an apparent reference to CNBC, he observed that there isn’t enough news in the day to fill ’14 hours of programming, leading TV personalities to ‘beat the drum.’”

When the Great Depression hit, my parents both lived in rural Virginia. They knew hard times were out there but kids were still able to be kids, businesses were still able to do business and life went on, not as it had and not as it would in the future. It wasn’t the Waltons but it also wasn’t the disaster of the day.

Is it because they didn’t know how to monetize news of the Great Depression?  Maybe.  One thing’s for certain, the media know how to hype fears during a recession – it is what feeds the beast.  And many times is the dog with the bone.

YouTube Preview Image It was about a year ago Heath Ledger died tragically.  Montel Williams was a guest on FOX and when they wanted to beat the drum endlessly about Heath’s death, Montel tried to get the focus on what he thought was important. The hosts got upset. The woman host said, “We’re just trying to feed the beast.”

Likewise reporters can all say, we’re not doing anything but reporting the recession. Yeah, along with a hell of a lot of “what ifs” thrown in for good measure.  What if China stops buying our debt? What if the DOW goes to 1000? What if GM goes bankrupt? What if (fill in the fear)?

5 Keys How To Manage  the Beast Within Your Own Mind:

  • 1) Know you have a choice what you listen to and what you don’t. If you are reading a story, make yourself find a glimmer of hope – even if it is buried 7 paragraphs down. Don’t linger on the headlines.
  • 2) Concentrate on one thing you will do to move your business forward before you get out of bed.
  • 3) Don’t watch the news before going to bed
  • 4) Just before you fall asleep, recount three good things  that happened that day -no matter how small.
  • 5) Get and listen to the greatest motivational recording ever made by Earl Nightengale, “The Strangest Secret.” There’s a reason millions have been sold because he shows how we are all about as happy as we make our minds up to be.

I agree with the head of Blackstone  – if we are going to be able to do anything with our lives or our businesses this year, we need to manage the space between our ears and stop feeding the beast.

Are They Doing Enough to Help Small Business?

Georgette Mosbacher & Bob Phibbs

Georgette Mosbacher & Bob Phibbs

I was on FOX yesterday with Georgette Mosbacher and host Alexis Glick. Georgette had written an article in the Financial Times. I was asked to come on the program and talk about what I thought of the Stimulus Plan as well as tips for retailers.

For the record, I found Georgette and I had a lot in common and I admire what she has achieved and all the help she has given women to own their own business. We agreed at the start, this was just business, nothing personal. That didn’t mean her gloves wouldn’t come off. In fact at one point she called me “Robert.” No one called me Robert unless it was my mom – when I’d done something stupid like play her new piano with my red bow and arrow when I was nine. But I digress.

Alexis posted the clip which you can watch on her blog and said, “If you want to see SPARKS FLY, watch this!!!!!! This may have been one of the most heated debates on my morning program and it had to do with what I believe is the number one issue in this economy; are we doing enough to help small business owners in the wake of this recession?”

My point on Alexis’ show was simply that I don’t think small businesses are clamoring for more SBA loans – loans of any kind. What I am hearing is employers are scrambling to find customers; how do they incent, convince now is a good time to buy and upgrade their sales staff. That goes for my $3 billion dollar clients and my $3 hundred thousand clients. They are looking for glimmers of hope – anything that says we are heading onward, not waiting for the next shoe to fall.

Georgette’s point was governments are not doing enough; that SBA should be a cabinet position and then said it needs to be scrapped altogether and redone. To me it seemed like whining, “We want our bailout too.”

What precisely would be enough for small business? Knowing the variety of small businesses out there, how they are run, capitalized, etc – how would you know what to do and apply it fairly? I don’t think you would. And I think it is a distraction from the main issue: confidence.

The most important thing we have got to get in the system is the end to the doomsday approach to news. We have got to have confidence.

After 9/11, did we hear unending stories about what else, who else, how else someone somewhere would try to kill us? No.

The news media focused on digging out, the volunteers, the fact the nation was taking steps to secure us. That’s what we needed to hear.

Compare that to now.

Yes, I heard Rep. Kanjorski on C-SPAN talk about the electronic run on the banks last September. I got it, very scary, out of our control, did significant damage to the system.

But the dog-with-a-bone atmosphere pervading every story with an angle on our worst is yet to come is killing small business. Any good news is tempered by bad news. It reminds me of the Smother’s Brothers skits, “That is not a compliment.”

The endless “B” roles of foreclosed houses hide the reality the New Yorker magazine unmasked in their article by George Packer, “The Ponzi State.” There were felons who caused this, not all were well meaning homeowners – far from it.  But the images are that no one is paying their home loans.  No wonder the National Federation of Independent Businesses says business owners are incredibly pessimistic. Garbage in garbage out.

And you can bet when they release the unemployment numbers this morning, they’ll have a field day of “worst since” descriptors to make sure everyone notices.

Small businesses are not looking for more loans, they are looking for hope. Something we can put our teeth into without being hit on the head so hard a tooth falls out.

Hope. It’s what drove the election, it is what is continually being removed. That is what I think small business is looking for, plain and simple. I’m willing to stand up and say it anywhere – even on the news.

What say you?

Retail Sales Won’t Increase With Hidden Tags

Can we just all grow up and admit that the merch won’t fly off the shelves if the price tags are hidden?

You know how it is, you walk into a jewelry store, look into the cases and find a ring or watch you like. Then you have to ask the priveledge of the guy or girl with the scrunchy key wristband to unlock the case.

They ask you, “Which one?” and then demurely take out the item and finally reveal the price. Does this work? Did it ever?

I think this must be a holdover from the Eisenhower administration.

Maybe it came about because a salesperson was trained only to give a final price after the customer had to have it. The thinking was the great salesperson would make the customer fall in love with the product so much that the final price wouldn’t really matter all that much and they would just charge it.

Times have changed.

I was in Nordstroms this past week looking at men’s casual clothing.  I had to hunt and pick every item to find where the tag had been tastefully hidden behind the placket, the button, the collar?  And I wasn’t looking for the price, just the size!

How childish do those employees feel going item after item, rack after rack to tuck in each and every tag?

In this economy, if shoppers find it interesting enough to consider trying it on, give them the courtesy of not having to be treated like a fourth-grader playing Hide N Seek.

With necessary reductions in labor budgets, train employees how to sell, not hide tags.  We’re all adults here, just treat us that way.

Who else do you know plays this game of hiding the tags?