Ways small retailers can thrive in a world of retail giants

May 7, 2018


Imagine the following retail scenario. You discover beautiful piece of furniture only to find that it is a "one of a kind." You discover where you can order one only to find out that it could take four to six months to receive your order. So, how does this retailer manage to survive in the age of free two-day shipping? Salt Creek Farmhouse is an example of a vertical furniture retail shop that has found ways to develop customer relationships to thrive in an omnichannel world. Retail survival requires transformation to new paradigms. Lesson one starts with focusing on doing what the giants are not doing.

Why this is important: When you don't have the resources or infrastructure, the best way to compete with Amazon is do something different. Some of the smallest retailers are deploying strategies that other retailers can leverage for differentiation.

Salt Creek Farmhouse – a success story of how the tiny can compete

Salt Creek Farmhouse is a story from "fly over country." It is a great story of a young couple's passion to develop a business around their purchase of a farmstead. A story of a woman, Ashley Welch, who made the time to understand her core customers and build a business and products to fit them. A story about quality, not quantity. A story about connecting with customers online, and engaging them to tell the "Farmhouse Story."

I heard about Salt Creek Farmhouse the same way that most of their new customers learn about them – through word of mouth marketing from a very satisfied customer that had just purchased some of their products. The rest of the story is how they have developed ways to reach customers. This is also a much larger story about how the smallest of retailers can compete and thrive in the age of giants like Amazon and Walmart.

Lessons learned from grass roots for thriving in an omnichannel world

Retail is an expensive business to launch in terms of physical locations. First, there is the space, purchased or leased. Then there is a sizable investment in inventory to stock a store. Another major cost are the people to staff and operate the store. It, perhaps, should not be surprising that many new retailers start online where the costs are lower and their reach can be greater, even international in scope. Many startup retailers are creatively leveraging digital assets to reach core customers before they consider building any stores.

Salt Creek Farmhouse literally started selling products without a storefront. Social media was a natural medium. Customers helped lead the way by posting photos of their Farmhouse purchases on social media like Facebook and Instagram. Salt Creek Farmhouse's first "store" was actually a digital presence on Etsy. Like many retail startups, Salt Creek Farmhouse has leveraged digital to now come full circle and open a physical retail store.

Many businesses can leverage lessons from the smallest in retail

Salt Creek Farmhouse is literally a "retail shop" of old main street, with a limited selection of focused products. They certainly do not compete on breadth of selection, speed or two day free shipping. With all of the types of furniture sold online today, it is in fact remarkable that they can compete at all. Yet, the very reason for their survival is a counter strategy of doing things that the giants are not doing, or not doing well.

Some might argue that the story from a "small shopkeeper" is not relevant and will not scale. Yet, the smallest of retail must literally win customers from those who turn to Amazon and online first. They must also compete with national chains who have broad selections in store, with home delivery in days. Whether it be Salt Creek Farmhouse or Warby Parker, todays emerging retailers are deploying digital strategies before opening stores to sell "things."

Five lessons from Salt Creek Farmhouse

1.  Telling your story is as important as the products you sell

In the age of mass merchants, much of retail lost its "soul". Stores merely became places to sell products. Salt Creek Farmhouse is a small business and retail shop with a great story. Their story creates a unique brand identity and differentiation for their products. You can read their story under the "Our Story" tab on their website.

2.  Engage your customers to help tell your story

Far too many retailers use social media as another way to advertise products and promote sales. One of the most powerful aspects of visual social media like Instagram is having customers posting photos of how they are using products in their home. Social media is the new WOM (Word of Mouth), and it is most powerful when customers lead and speak about their experience. To quote Salt Creek Farmhouse's Instagram page: "Lovely pieces should come with a lovely story.

3.  When you can't compete on price, compete on value and personalization

If it comes down to selling products at a price, game over, Amazon and Walmart win. People still value quality. Salt Creek Farmhouse competes on quality artisanship. They also create personal relevance by designing things for customers, and pieces that you cannot purchase everywhere. Even giants like Nike are realizing the power (and gross margin) of enabling customers to "create" and personalize their own shoes.

4.  Know your customers and go where they are shopping

Salt Creek Farmhouse's production volume is currently too small to fit the needs of Amazon or Walmart. Moreover, their products would get lost and never be found in the millions of SKUs online. Etsy was a perfect digital format for Salt Creek Farmhouse. Their products fit the artisan style of the other digital stores on Etsy. Salt Creek Farmhouse found core customers would organically search for products like theirs on places like Etsy. It is more important to be where your customers are, than to be on sites or in stores with the most traffic.

5.  Lack of inventory can be managed as an asset

Historically, retail operated on the premise of purchasing items inventoried on the shelf in store. This requires substantial capital investment in inventory and distribution systems. Salt Creek Farmhouse literally carries almost no inventory. In order to sell pieces as they build them, they focus on other value propositions of customization and exclusivity. This requires breaking the old paradigm of "mass merchandising". It also requires developing an intimate relationship with customers who appreciate quality and service beyond the expected.

There is no apocalypse … retail is transforming

Those forecasting a "retail apocalypse" are typically focused whether on historical models will survive. Retail stores that are no longer relevant die. Innovators who transform replace them. Kudos to women like Ashley Welch, who brought Salt Creek Farmhouse to market based upon a vision and new paradigms … including using stay at home dads as a primary labor force.

Could not connect
October 26, 2018
$100,000 Hunger Mountain Co-op Investment to support VCLF’s Food, Farms & Forests Fund
October 25, 2018
VRGA: New Association Health Plans Available to Retailers and Grocers
October 22, 2018
Halloween spending could reach $9 billion
October 19, 2018
Mental health professional turns to retail therapy
October 17, 2018
Make the Most of Small Business Saturday – November 24
October 17, 2018
3 out of 4 Small Business Owners Support the Trump Tariffs, BizBuySell Says
October 15, 2018
H&M UMall store opens to eager crowds
October 12, 2018
On the Hunt for Help: Upper Valley Employers Fight for Workers
October 11, 2018
One-stop business portal will simplify government for small businesses
October 10, 2018
Kroger to phase out plastic bags at all its grocery stores over 7 years
October 8, 2018
Minimum Wage Re-Emerges as Debate in Race for Vermont Governor
October 4, 2018
VPR and Vermont PBS team up for debates
October 4, 2018
Patagonia, Walmart, Gap work to get out the vote
October 1, 2018
Hannaford Stores to Charge 5 Cents Per Paper Bag
September 27, 2018
Women in retail among Fortune's 'Most Powerful'
September 27, 2018
Trump’s Tariffs May Hurt, but Quitting China Is Hard to Do
September 25, 2018
Grand opening of ReStore in Milton
September 25, 2018
C&S Wholesale Grocers Announces Hunger Action Month Contributions
September 20, 2018
Scott joins national workforce development initiative
September 20, 2018
Mike DeSanto: Amazon’s market dominance a threat to retailers, workforce
September 19, 2018
The Rural Advantage: Rural Retailers: The Risks, The Rewards
September 13, 2018
Vermont governor: Canada is crucial to our economy
September 13, 2018
September 11, 2018
Commission Discusses a Taxed-and-Regulated Cannabis Market for Vermont
September 10, 2018
Casella acquires two Rochester, NY, businesses
September 10, 2018
New program to help Vermont female entrepreneurs
September 5, 2018
Prepare for Emergencies
September 4, 2018
NATION Why the retail industry isn't struggling as much as you think
September 4, 2018
Price Chopper matching donations for Red Cross disaster relief in September
September 4, 2018
Windsor County Economic Report: Jobs many, workers few across several industries
September 3, 2018
Hard Lessons (Thanks, Amazon) Breathe New Life Into Retail Stores
August 31, 2018
Grocers Get Set for September Family Meals Month
August 29, 2018
How to craft a successful SMB retail customer experience
August 23, 2018
Vt. Allstate agencies aid Foodbank BackPack Program
August 22, 2018
Employees at C&S Wholesale Grocers Corporate Headquarters Pack 100,000+ Meals
August 21, 2018
Health Plan Enrollment Rules
August 21, 2018
Women Grocers of America – Making a Difference for the Future
August 20, 2018
Retail Is Coming On Strong: What's Trending Now
August 20, 2018
Member of the Month: Stowe Mercantile
August 17, 2018
Target hiring 150 people for October opening in South Burlington
August 13, 2018
Sarah Kaeck: Beyond recruitment: What keeps workers in Vermont?
August 8, 2018
Vermont Bans 'No Rehire' Clauses
August 2, 2018
Scott: Vermont's labor force is growing
July 26, 2018
What is This? A Retail Apocalypse 'Near Me': How Local Search Can Revive Your Business
July 25, 2018
July 25, 2018
Member of the Month: Keeler's Bay Variety
July 24, 2018
As Amazon Moves to Capture Local Government Spending, Here’s What You Can Do
July 24, 2018
AG: New recreational marijuana law does not legalize selling in any method
July 19, 2018
A Vermont Road Trip: 8 Places to Stop on a Drive Through the Green Mountain State
July 19, 2018
Ten ways to outperform 2017’s Black Friday retail success
July 17, 2018
5 Ways AI is Impacting Retail Marketing
July 17, 2018
Which Federal Employment Laws Apply to My Company?
July 16, 2018
Vt. Economic Rank Depends on the Poll
July 16, 2018
July 13, 2018
Vermont marijuana: How new law compares to Maine, Massachusetts and other states
July 12, 2018
New law curbs abuses by credit card terminal lessors
July 10, 2018
What does the Supreme Court sales tax decision mean for Vermont?