Osceola Sentinel Tribune, IA
02-01-07
Locals discuss how to compete in post-Wal-Mart business climate
by S-T Staff
If you build it, they will come, the movie cliche says.
In the case of Wal-Mart, expected to start construction on a nearly 100,000
square foot building west of town perhaps as soon as March, some local retailers
may be asking, “Will they keep coming?”
Wal-Mart announced plans late last year to build a new Supercenter at the
intersection of Highway 34 and Interstate 35. The store is expected to employ
between 175 to 200 people.
American State Bank sponsored a business workshop Monday night, hoping to
educate local business owners about how to work and compete with the retail
giant. About 55 people attended the workshop.
The bottom line: Competing against Wal-Mart won’t be easy, but it’s not
impossible and small businesses can survive if they can differentiate their
business, products and services.
“Competing against Big Box retailers is an awesome task. So don’t try to do it
alone,” says a “Between the Aisles” magazine article titled, “Big Box Super
Stores: How can independent retailers compete?”
“Form community partnerships with non-competitor retail stores. Share
information and experiences about what marketing techniques work with
customers in your area....No idea by itself is a magic bullet, but all ideas together,
applied in a consistent manner, can bring forth results that will give independent
retailers an enhanced position against the competition in today’s market,” the
article states.
Jeff and Patrick Edwards, owners of Osceola Farm and Home and Knoxville
Farm and Home, have been there. When Knoxville’s Wal-Mart announced a
store there in 1999, their family-owned business was located on the opposite end
of town.
Their dad had his own Wal-Mart philosophy: “If I have to compete against WalMart, I want to be right across the street from them.”
And that’s what the family-owned business did, though it took months to meet
that end.
Jeff Edwards said they re-evaluated their business, adding some products and
services, including letting customers rent power equipment. He urges local
businesses to experiment, try new things and don't be afraid to admit failures if
you try something and it doesn’t work. At Knoxville Farm and Home, he said,
they tried servicing Wal-Mart’s lawn mowers, but stopped after it didn’t work in
soliciting new customers.
“The fact is Wal-Mart will create traffic,” Jeff Edwards said. “If you play your cards
right, you’ll get a chance to get a crack at those customers when they come to
town.”
It’s all about marketing, customer service, being knowledgeable about the
products and giving the customer something they cannot get at a big box store,
including in-home installation, delivery or other value-added services, they said.
“The easy days of retail are going behind us,” Patrick Edwards said.
Another warning: Don’t engage in price wars with Wal-Mart. Be in the ballpark,
and give the customer a reason, such as quality, for buying your product.
The two-hour workshop at American State Bank also included presentations from
Curt Borcherding, of Boyt Harness Co. in Osceola, and Dave McLaren,
Southwest Commmunity College’s Small Business Development Center director.
Borcherding talked about his experience in selling Bob Allen Sportwear to the
retail giant. McLaren offered small businesses help, including how to differentiate
local services and products.
Kevin Klemesrud, executive vice president at American State Bank, said he
wanted local business owners to be able to draw on experiences from other local
business owners on how to approach the post-Wal-Mart business climate.
“It’s different for every business when it comes to what they’re going to have to
do,” he said.
And some may not survive. Leon resident and business owner Marilyn Saxton
worries about the small retail businesses there. Saxton, her sister, Marcia Stone,
and Alan Couchman, all attended Monday’s workshop. Saxton's family owns
McGahuey Implement in Leon, and said they have already implemented some of
the business strategies discussed. While she thinks their business will be OK,
she worries about smaller stores in Leon closing.
“It’s pretty much the way of the world,” Saxton said. “You got to be on the
offensive instead of the defensive.”
Another educational workshop about the effects of the retail giant is set for 7 p.m.
Feb. 19 in the Clarke Electric Cooperative meeting room with Iowa State
University Professor Ken Stone. Osceola Chamber-Main Street and Clarke
County State Bank is sponsoring the discussion with the economics professor.