Birding Business September 2014 - Local Retailing

Local Retailing

By Michelle Z Donahue Contributing Editor

Boosting the Neighbors, Buoying your business

A MERCHANT WHO APPROACHES BUSINESS WITH THE IDEA OF SERVING THE PUBLIC WELL HAS NOTHING TO FEAR FROM THE COMPETITION.
– James Cash Penney


On a warm July afternoon in an outlying suburb of Washington, D.C., Debi Klein stood in the middle of her bustling shop and peered around her, sizing up items for sale on her many overflowing walls, tables and shelves.

Hand-glazed ceramic tiles by a husband-and-wife team in a neighboring Maryland city. Bird-and-botanic tea towels and spice-filled mug coasters from just over the nearby Catoctin mountain range. Bird boxes painted in jewel tones by Pennsylvania Mennonite craftsmen to look like wee human homes. Wind chimes from Virginia.
These are just several of the items Klein identified in her inventory at The Backyard Naturalist in Olney, Maryland that come to her from über-local sources. Some of them, like the tea towels and bird houses, virtually fly off the shelf, carried away by customers delighted by the one-of-a-kind nature of the thing.
Especially around the holidays, or whenever someone is gift shopping, pointing out that an item is locally produced often helps clinch a sale in Klein’s store when the customer is on the fence.

“We’re very interactive with our customers, so if we see them looking at something, we’ll tell them it was made just down the road,” Klein said. That frequently tips the customer from “just browsing” to “gotta have it,” in part because they feel they’re purchasing something with character that mass-produced items often lack.

The local-made movement
“Shop small” appears to be riding an ever-expanding groundswell of popularity.

The trend is growing even in the face of competition by bulk discounters and big-box stores—perhaps partly in response to them. “American Made” is still a bright selling point, but increasingly, customers are also seeking out items made in their communities and regions.

Visit any Saturday farmer’s market and alongside the standard honey, fruit and vegetables from area merchants, there’s also usually an array of art, jewelry, woodworked crafts, soap and furnishings. Restaurants, too, have piled on with gusto—more and more, even some chain restaurants now feature items on the menu sourced from a nearby farm.

In Connecticut, Jim Flood, president of specialty glass art company Bovano, has watched many retail trends come and go over the course of his company’s 60 years in business. A once-hot love affair with big-box retail is fading, and support is building once again for smaller businesses.

“The desire to buy local is both growing and sustainable,” Flood wrote in an e-mail. “Visit any local craft festival, which are growing in number, and you will see evidence of this trend.”

Especially when they are located in well-traveled shopping districts, retailers like bird-supply stores are uniquely positioned to showcase a variety of goods from other small enterprises.  Klein greets many of her customers with a bright smile, a hug and a greeting by name; her store doubles as a neighborhood gathering place, and she champions her locally made products as a way to foster a greater sense of community.

Just as education on bird-oriented products increase a customer’s understanding of avian life and ecology, a retailer’s ability to talk about locally made products gives patrons a sense of investment in the vitality of a region and its human inhabitants.

“We know intrinsically if we turn people onto birds in their back yard, they’re going to develop a broader interest,” Klein said. “We’re trying to keep people in touch with nature so they take a proprietary interest in what’s going on --on their block, in their community and then in the world.”

Flood agrees. Many retail customers have a “strong passion,” he said, to buy locally made products. “They have come to understand the benefit to their community,” Flood said. “It takes a lot of work by the artisan, the retailer and the customer, but the benefit is worth the effort.”  And, consumers increasingly link ‘quality’ with geographic proximity, as well as equate local-made with products being fresh, distinctive and crafted with care.

Harvey Barlow, who has owned and operated Wild Bird Garden in Frederick, Maryland for the last 22 years, said he’s noticed a virtual explosion of higher-quality items coming onto the market in recent years, mainly from American sources.

“I think it’s just people looking at what was out there, and saying to themselves, ‘Well, we can do that,’” Barlow said, which lead to a proliferation of small companies that specialize in offering better products. He observed one other notable side effect: an improvement in the quality of internationally made items, as well.

Sleeper Economic Effects
The benefits of the “creative economy,” as culture- and arts-related enterprises are labeled by government list-makers, also serve very practical economic purposes.
According to a report by the National Governors Association, arts and culture are huge reservoirs of revenue for state economies. In 2006, these industries contributed $3.9 billion to North Carolina’s bottom line, while in Massachusetts, healthy growth in the creative arts sector pumped $4.23 billion into the state’s economy.  In 2012, Maryland arts industries rang up nearly a billion dollars in gross sales.

Many creative crafts businesses are home based, and so lack storefronts in commercial areas. As a result, arts and crafts industries are often overlooked as contributing significantly to the local economy. Closer studies reveal a different story, such as a 2007 look at the impact of creative activity on North Carolina’s economy by Regional Technology Strategies. The presence of local creative industries directly contributes to increased household income and area job growth, the survey found.

“Small Business Saturday,” a campaign launched by credit card company American Express to encourage more consumers to patronize their nearby independent retailers, has grown steadily in awareness and participation since its inception in 2010.  Spending on this day, slated each year for the Saturday following Thanksgiving, increased from an estimated $5.5 billion in 2012 to $5.7 billion in 2013.

In bird hobbyist stores, the bread-and-butter items that pay the rent are still directly related to birding. Sales of high-quality seed mixes and products like nest boxes, feeders and baths are still the core of her business, Klein said. But since customers typically don’t buy a nest box each time they come into the store, savvy retailers must find creative, value-added ways to bring their customers back. Capturing part of the locally produced economy may be part of that dynamic.

Developing Local Partnerships
The formula for finding neighborhood and regional partners to bring in fresh products has evolved over time for both Barlow and Klein. While they’ve both stocked locally made items from almost the very beginning of their operations, hyper-local still does not represent even a large minority of products they carry—though both merchants said they’re interested in taking greater advantage of the growth possibilities offered by tapping the locally made market.

Klein explained that initially, her decision to carry items made by nearby producers was part of an ongoing campaign to set her apart from chain retailers and big-box stores. But it’s also been an effective way to scratch an itch.  “I want people to come in here and have a different experience, and that’s part of what draws them back,” Klein said. “So it’s very practical. It satisfies my need for creativity within my store and the world.”

Large regional craft shows are a rich source of inspiration, such as the Sugarloaf Craft Festival, one of the largest and oldest in the Mid-Atlantic region. Though these shows are a big draw, small community shows, such as those held in recreation centers and churches, can also be an unexpected well of possibilities for finding unique items to carry.  Plus, once the local arts and crafts community gets wind that a store carries hand-made items by smaller vendors, potential partnerships often begin walking through the door.

Barbara Loesch, a ceramics artist who creates folk-art inspired waterfowl, said she got the idea to approach Barlow at his store after talking with her peers at the pottery studio where she frequently works. They initially suggested that Loesch try selling her wares online, through sites such as Etsy, a popular marketplace for handmade goods. Rather, Loesch said, she found herself thinking of places where she would shop herself.

“I thought, no, I’d be better to do something locally,” she said. “I thought about Harvey and Wild Bird Garden, and took some birds in to see if he had any interest in selling them.”  The two now have an agreement to sell her ducks and geese in his shop on consignment.

Klein said she tries to engage prospects in a frank discussion on how retail works and pricing—if the situation calls for it.

“The goal is a win-win,” she said. “If it’s a product I like, and I like the people and can tell they’re really talented, earnest and honest, then I want to be sure that any advice I give them is solid, and not give it if it’s not called for.”

Retailers and vendors sometimes experience the sting of differing prices, such as when a vendor undersells his retail partners at craft shows or online. Keeping an open channel of communication to discuss the shop’s pricing standards and listening to the vendor’s needs can help forge a mutual middle ground.

“Local artisans must respect the pricing requirements for a local retailer,” Flood said. “Too often they sell online below the retailer’s price. Very large national retailers have cut profit margins making it difficult for independent retailers to survive, so this is an opportunity for local artisans to gain entry into the market.”

Barlow said that for his part, he hopes the trend helps keep more small businesses alive.

“Everyone seems to be more conscious of shopping and eating locally, but it’s getting harder and harder to operate small stores,” he added. “Maybe the trend is going to help sustain smaller stores when people start buying more locally.”