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When small businesses compete for the same customers as Big Box  retailers, the story goes, they lose. But a small paper goods, office furnishing, and gift shop located near a Staples megastore in the Boston area has managed to achieve great results.The small store offers niche products that cannot be found in Staples. Its product assortment ranges from a 35¢ ballpoint pen to a $3,500 fountain pen by Graf von Faber-Castel. To its upscale customer base, the retailer offers special products available only in the store, including top-of-the-line stationary, invitations, leather goods, art supplies, and writing utensils.

This small retailer manages to keep 35,000–40,000 items in inventory, but its assortment differs significantly from that of Staples, which appeals to the mass market. Whereas Staples offers convenience for customers shopping for basic office and school supplies, the small retailer stocks a more emotionally valuable product like a $2,500 ergonomic leather desk chair.

Customers value the special service that they receive from the small retailer; it knows its clientele better, so it not only stocks products they desire but also helps them navigate the product selection. As another perk, customers feel as though they are supporting local businesses rather than a national chain. The local retailer makes contributions to local schools and ballet activities—investments a national chain is not likely to support.

Both the Big Box retailer and the small local retailer thus appear to have found room in the market. Depending on what the customer is searching for, he or she prefers one retailer over the other. However, the service and unique, high-end products that the small retailer provides appear to be offerings that prompt true customer loyalty.

Discussion Questions:

1. How can a small retailer compete with a mega-store like Staples?

2. Can any small retailer embrace this strategy to survive?

Davis Bushnell, “Thriving Retailer’s Personal Stamp,” Boston Globe, April 12, 2007.