The Big Box Theory

Dec 3, 2009

It’s a common problem. Many of today’s new and existing restyling customers believe the big box stores will give better price and service on Bluetooth, video, audio and other restyling items. And by big box, we mean everything from Lowes to Costco to Best Buy and similar stores.

People tend to buy into the big box perceived theory of value that the bigger the retailer is nationwide, the better its discounts are from manufacturers and, therefore, better prices are naturally passed on to customers.

But those in the trenches know better. And part of that is because that for every brand and store that is on the big box side, there are another brand and another store opposing them. It’s almost like guerrilla warfare, with isolated pockets of shops and manufacturers that seemingly have one goal in mind-to beat the big box stores with better pricing and service.

We asked some of our modern-day warriors from both sides of the fence (suppliers and shops) for their input on going toe to toe with “the enemy.” Their answers might just help you in your own business battle.

Why suppliers choose restylers

We started off by answering one of the most common questions: What do you tell your customers when they think they can do better at the “box”? And we’ll start with the manufacturers and distributors we culled for info.

Yoni Kellman from Madison Heights, Mich.-based Motovicity advises a good basic war room strategy: “As an independent shop, you need to promote your own strengths, which may be superior customer service, better attention to detail, or a more personal relationship with your customers, as some examples,” he says. “These are a few of the things that I see as weak areas for the big box stores. So hit them where it hurts, by showing customers where you can outsell or out-service the big box stores.”

Jim Chick of Bestop, Broomfield, Colo., illustrates how the walls separating big box stores and smaller businesses work both ways. He says, “We don’t tend to supply big box stores due to their lack of expertise to sell and service, inability to handle and apply specific product well and their pricing payment requirements.” He goes to explain those huge points that are truly opportunities: “It’s better to have somebody who is acquainted with the market and different vehicles. Even though, they may sell tires, it’s been mechanized. If you walked into a Costco and wanted to put 40s on your Jeep, they’re going to send you home. They sell oil, and if you ask for differential-slip lube, forget it.”

From the manufacturer’s side, it’s also about how the boxes work their money. Chick says, “Payments. They have scan payment, where the vendor is not paid until the piece is sold to the consumer. This differs by chain, but there’s not enough profit to absorb that.

“We don’t get nine months [payment] from our vendors,” Chick continues. “We have ready customers, customers that don’t work their [payment] systems that way either. Our existing customer base is almost 55 years and we love to deal with them. We’d rather pursue those relationships than take a chance on decreasing our brand.”

Partners with restylers

Are those differences definite deal-breakers, we asked. Chick says, “I’m not saying we’d never do it. I’d say, in general, there’s a mutual disinterest. There’s always exceptions. But, in general, Bestop’s products don’t lend themselves well to the big box due to application-specific products. It’s kind of a mixed bag for us. We won’t rule anything completely out, but we tend to be tentative.”

With that in mind, we asked Kellman how Motovicity’s marketing reflects the firm’s beliefs.

“At Motovicity, we have always been a partner to our customers,” Kellman notes. “We only sell at the wholesale level, so we don’t compete with our customers by selling to their customers. This makes us more a part of their team, and allows us to work with them to help grow their business.”

And how is that proven to those customers? His answer keys on the most important point in this battle: “Our customers can buy products from us at profitable and competitive prices, which they can turn around and pass to their customers.

“But everyone needs to get past the pricing wars. As a specialty shop, you need to explain why you can service a customer better than the big box stores. It could be as simple as knowing your customer’s name when he or she walks in the door. Relationships with your customers can help to smooth over a few-dollar pricing discrepancy if you are good at what you do, and ensure that the customer is happy with the products or services you have provided them.

“It’s always safe to follow the simplest of mantras: Under promise, over deliver. Customers remember service that was more than they expected. So surprise them.”

Is it really about price?

What, then, should shops do to be competitive? “Specialize,” Kellman says. “The beauty of being a specialty shop versus a big box store is that any customers in your store came to you specifically for your services or products. They didn’t just walk by a mobile electronics department [in a big box store] and thought they would look around while their spouse shops for washing machines. You need to treat each customer as someone who has already made the decision to consult a specialist. So give them the attention and knowledge that only a specialist can.”

We turned to the other principals in the trenches – those with restyle shops- for some examples of what they are doing in their battles against the boxes.

Brady McCoy from Pickups Plus, Lewis Center, Ohio, agrees about pricing and explains his company’s philosophy: “We try to emphasize that pricing alone should not be the only buying decision. There are plenty of examples to prove this point, as well. Circuit City is a great one currently. A lot of people saved money with them, but now, if there is a warranty problem, it is more than likely going to cost a whole lot more than they expected, especially on the labor side.”

Jared Pugh from Wichita Falls, Texas-based Rock And Roll Offroad, laughed when we told him of our “big box” story. He says, “We are gearing up for our biggest move yet. We are re-locating to the Dallas/Fort Worth area to be a big-box-style store.” He knows about competing with the boxes, and now he has to keep himself from looking like one.

Pugh went on to give us his viewpoints when it comes to battling the boxes: “Big box stores obviously sell in volume so, for smaller brick-and-mortar stores, try picking different lines than what the big guys sell. But don’t compromise or cut corners; sell good quality components.”

And how does he make himself different?

“Rock And Roll Offroad usually offers a free gift: a free Rock And Roll Offroad T-shirt or a pair of Spy Optic sunglasses with a big purchase,” he says. “Our customers are usually familiar with the big chains, and we let them know we will see more eye to eye with them.

“It’s a great selling point when you tell your customer that you offer the same services as the big guys but on a more personal level. After all, the customer is looking for good service and quality product. Sometimes, price isn’t the issue.”

Show customers you’re one of them

We wanted to know just how does their marketing reflect their beliefs.

McCoy from Pickups Plus says, “We tend to focus our marketing more on people that are focused on quality rather than people focused on price. We sponsor a couple of car clubs that are full of more discriminating people when it comes to quality, and the focus on price tends to fall a little to the wayside.”

Pugh described the marketing beliefs his company is best known for by saying, “Rock And Roll Offroad is constantly marketing in an aggressive and lifestyle-oriented manner. We have a target audience- the fan. Make your customers aware of how passionate you really are about this industry. In the end, you will have a following, and the work and fun seem to mix together.”

Theory is great, but how does a shop actually prove its stance to its customers?

McCoy says, “If you are going to sell yourself on customer service and quality, you have to be able to stand behind it. That means when a questionable issue arises, the ball is in your court; and when quality issues arise, they are handled quickly and to the customer’s satisfaction.”

Pugh adds, “Proving your stance to the customer is all about perception. If you have nothing in stock, how can you compete? It’s important to go above and beyond, and take time to ask your customer questions. Asking questions – and not ‘soapboxing’ – allows you to get to know what your customer wants from the project at hand. Who knows, you may make a customer for life or, even better, a friend for life.

“To compete is to stay a cut above the rest. Know your competition.”

Be a competitor

And now the tough question: Just exactly how do you compete?

We want concrete examples.

Pugh says, “Rock And Roll Offroad sends out mass e-mails at least once a month and has a complete customer data base. We stay active within the industry, go to trade shows, and sponsor events. Also, we try and make follow-up phone calls when we complete a build for a customer to make sure they are truly happy. Or when an online order comes in, we make personal calls to make sure each sale is valid, not a stolen credit card or spam. It helps us to get to know the customer.

“It’s all too easy just to check your e-mail and ship out orders. Customers feel a sense of trust when they hear you checking the order. It’s all about molding your company [in a way] to have fun and get the task at hand completed.

“Do your best and put pride into each step and you will succeed.”

Pickup Plus’ McCoy goes for the strong points when he says, “While you still are going to lose customers to the big box store, we are able to compete by offering more complete service with a better, knowledgeable staff.”

“A big box store may be able to do bits and pieces of a vehicle, but we have the ability to complete the entire project in a one-stop shop with a quality warranty and fair pricing. In the end, there really is no comparison.”

So it all comes down to what you are already doing and just doing it better.

And don’t forget about all the products and services the big boxes don’t have. Like all sales happen one at a time, there is safety in numbers.