One of my favorite television shows is "Tiny House Hunters" (#TinyHouseHunters) on HGTV. The tiny house movement is all about living simply in truly tiny houses that are typically less than 500 square feet in size. It fascinates me that people can truly downsize that much and then live comfortably…off the grid.
Radical downsizing of this nature may be a pipe dream for many, but those who thrive in this lifestyle have learned a thing or two about living the good life and making the most of what they've got.
As retailers we are often guilty, I think, of forgetting to slow down and savor our successes. We keep pushing for more, more, more, and we forget that sometimes less can truly be more.
Here are seven things I've learned from watching people live in tiny houses that I think may apply to how we manage our retail business:
Pay attention to the things that make you great. What little things do you do every day to make a difference in your world? Do your customers know you appreciate them? Sometimes something as simple as hand-wrapping a purchase can make a customer feel appreciated.
In today's retail environment sales per square foot really doesn't mean what it used to. Think about ways to maximize what you have and even downsize your stores' footprint. Consider showrooming as opposed to carrying a full line of inventory. Buy Online and Ship to Store and Endless Aisle are ways to expand your product offerings without increasing your overhead.
Inventory can be both your best friend and your worst enemy. Learn how to make your inventory work for you. Analyze all your data and look for the exceptions. Almost 80% of your inventory is going to work just like you expect so focus your attention on the other 20%. What are you about to run out of? What do you need to consider closing out?
Recognizing risk before it becomes a reality can turn liabilities into profits.
For tried and true brick and mortar retailers this can be a tough concept. But really, must you have four physical walls in order to sell your product?
I recently talked to a group for whom retailing is a significant part of their business, but it's not the core of their business. They have multiple retail-like outlets across their physical footprint. They surprised me when they told me that every sales location they have is uniquely identified and carries its own inventory.
Why is that surprising? Because they have people who walk their facility selling items, (sometimes food, sometimes trinkets or souvenirs), and each person is considered a unique sales location, each with their own unique inventory.
This model made me think about the companies that struggle with the shared inventory concept: Could overcoming their struggles be as simple as having unique locators for every stop along the supply chain?
Every retailer knows that doing business in a brick and mortar environment is costly. The Four Wall profit concept has closed many a store, especially recently. As large enclosed malls begin to struggle, the cost of square footage is decreasing rapidly as the retail real estate bubble pops. But conversely, does that mean you should run out and open a bunch of pop-up mall locations?
You should probably not act without considering the additional costs. Remember, as tiny house inhabitants know only too well, sometimes less really is more.
When downsizing you have to really dig deep. You have to identify all the things in your life that really matter and leave behind all the other "stuff." Retailers need to do the same thing from time to time. Whether it's a long standing style that has lasted through several seasons or an old business process that consumes more time than it should, we need to take time to reflect and trim excess.
For me, one of the hardest things to leave behind as a merchant was Excel spreadsheets. I still remember how I used to love those Monday morning notebooks, each at least three inches deep. But I hated all the work I had to do on Sunday night just to feel prepared on Monday morning.
Even when we eventually adopted modern analytics tools, and I began to realize that integrated and automated dashboards could dramatically improve my work/life balance, I still felt the pain of losing some of my favorite stuff.
In 2004, Lego was on the brink of bankruptcy. They had sold off the theme parks and anything else that wasn't nailed down. They knew the end was near. Digital natives (oh those blasted millennials!), didn't want to play with things that didn't require batteries.
At least that is what all the big data models said…and Lego was listening. Thank goodness they also took the time to listen to their customers. Real customers, like a 12 year-old boy in Germany. Without him and others like him they would never have created the huge kits, like the 5,900 piece Taj Mahal, that is now a mainstay of their multi-faceted business.
So the next time you are thinking of ways to take your retail business to the next level, stop and think of lessons you can learn from people who live in Tiny Houses. They seem to have a handle on making the most out of what they've got.