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									1070 Tested Ideas That Move Merchandise

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1010 Tested Ideas That Move Merchandise

An appliance retailer gets an idea—keep the store open until the wee hours for several days running and stage a special price event; "the late bird gets the worm." For reasons rooted perhaps in psychology, the idea clicks. In short order, several giant manufacturers are giving their appliance outlets complete programs for "Sellathons." A druggist concludes that it would be a nice gesture to present a little package of baby necessities to mothers of newborn babies. Soon several giant manufacturers are packaging these gift assortments at the factory and building complete marketing programs around them. A food outlet, in its nonfood section, bands certain soft-goods items in lots of twos and threes and gives them a special price. The "twof er" idea is born and this, in time, leads the giant Coca-Cola to the development of the six-pack as well as leading innumerable manufacturers in other merchandise classifications to the development of new concepts in size of sales unit. Some nonfood outlets get the notion that, since food produces enormous traffic, why not add food? The direct result—the fastestgrowing outlet for food today is the nonfood outlet and die food processors have had to adjust their marketing programs accordingly. The vast suburban shopping center started as a retail idea. It has revolutionized the total marketing process of practically every manufacturer of consumer merchandise. The food super decides it would be a good idea to supplant the



store buyer with a buying committee. Initially, this buying committee concerns itself with new products exclusively. Then it concerns itself with new propositions of any and all types. Then it lays down rules with regard to reorders for the buyer to follow. Now all giant retailers are turning to the committee concept of buying. This is compelling manufacturers of consumer merchandise to make an agonizing reappraisal of the functions of their sales forces. Clearly, the manufacturers' salesmen, when they call on the buyer, are not calling on the decision-maker. And they can't get into the meetings of the buying committee where the buying decision is made. Starting in 1961, some small retailers got the idea that the time was ripe to broaden the rental of a wide range of merchandise, rather than limit themselves to the sale of merchandise. Then Hertz, of car-rental fame, sees in this idea an opportunity for a nationwide chain of stores devoted exclusively to the rental of just about everything under the sun. Then Sears dips a toe into rental waters by arranging to rent sickroom supplies. Several variety chains follow suit. The end result—manufacturers must now plan special lines for consumer rental; must sell these lines to new types of outlets. Several very young men conclude that it should be possible to sell major and traffic appliances at one-third traditional margins. They start the present-day discount revolution—a revolution that has left its impact on practically every manufacturer of consumer merchandise from foods to drugs, from hard goods to soft goods. And, as one unanticipated consequence, fewer and fewer manufacturers are featuring list prices. As another consequence, many manufacturers of presold brands are producing special brands for the discount outlet. A handful of our giant retailers gets the idea that the sale of services—laundry services, dry cleaning services, optical services, etc.—is reaching a dollar volume that actually challenges the dollar volume achieved by the sale of merchandise. These retailers are putting in coin-operated laundries, coin-operated dry cleaning devices, beauty shops, optical shops; they are even selling insurance and mutual funds and travel. And a number of manufacturers and various service businesses find themselves contending with a marketing revolution. Some West Coast food retailers begin to promote the Hawaiian luau. Before long, some food processors are packaging Hawaiian



foods and offering retailers complete promotional packages for luau sales events. A men's wear retailer stages a turkey-carving demonstration on weekday evenings—offers turkey slices on rye free to shoppers. The turkey growers decide the idea warrants broader exploitation. The outdoor display of merchandise in front of retail stores is staging a comeback. Manufacturers find that display material prepared for indoors is not suitable for outdoors. Also, different promotional themes are needed for outdoor sales events. Retailers are beginning to show increasing interest in the vending machine—and for a spreading variety of merchandise. The age of the automatic vendor will not be ushered in by manufacturers of general merchandise; it will be ushered in by the makers of vending equipment and by retailers. But manufacturers of general merchandise will be profoundly affected by the coming age of automatic vending. In early 1962, several manufacturers of food, drugs, hosiery, cosmetics, had set up special divisions to prepare for the automatic vending age; right now special packages, special sales units, etc., are being developed by these manufacturers for the automatic vendor. A smart retailer reasoned that children had fewer opportunities to see the disappearing circus. He brought a miniature circus to his parking lot Now several manufacturers travel a miniature circus as a regular promotional event tied up with their retailers. Another retailer got the idea of having customers pan for gold in a plastic wading pool. He got the idea while thinking about the enormous popularity of Westerns on television. A maker of plastic wading pools refined the idea—offers it to his outlets as an exciting promotional event. More and more retailers, especially giant retailers, have concluded that the private brand can play an important role. The consequence; manufacturers who never before made private brands are now turning out these special brands—and some manufacturers are even giving their retailers private brand promotional programs that include special fixtures, special advertising, etc. A sales executive in charge of private brand sales is no longer unusual among manufacturers. Many retailers now have a so-called Courtesy Booth where checks are cashed, etc. The idea became big enough for big American Express to develop a complete program for these service booths:



layout of the booth, its construction, its various services, how to promote it, etc. And some manufacturers have found that this is a good point at which to question shoppers regarding new products, etc. A druggist decides that, while customers wait to have prescriptions filled, sales might be made if special items are displayed in the adjacent area. Now many manufacturers have specific programs designed to get their merchandise into this section as a second location. A food retailer tacks a small aluminum tray in front of his meat counter and displays packaged seasonings in the tray. He tries the same idea at the produce section displaying bottled salad dressings in the tray. Thus the idea of the shelf extender is born—and scores of manufacturers now offer the trade shelf extenders. A department store concluded that the fashion show really need not limit itself to ready-to-wear. The result—manufacturers of fine china, conversational furniture pieces, silverware, are now horning in on the fashion show. Retailers find that shoppers are increasingly inclined to trade themselves up. These retailers must actually pressure some suppliers to bring out higher price lines which then do extremely well for retailer-manufacturer. Retailers begin to use a P.A. (public address) system. They suggest to manufacturers that they would like to get competent "commercials" for use on the P.A. system. The manufacturers who oblige get effective promotion at the very best spot—the point of sale. A retailer, years ago, got the notion that special gift wrapping might be appreciated by his customers. Today, gift wrapping is a huge business—and has led many manufacturers to develop special factory gift wraps. Giant shopping centers have a giant problem—attracting sufficient shopper traffic. They begin to stage entertainment programs for the mall; for the parking lot. Before long, several manufacturers are traveling acting troupes and building around these entertainment programs complete promotional programs. A home furnishings dealer decides it would be an idea to bring rugs to the prospective customer—bring rugs right into the customer's home. Thus the era of in-home selling of home furnishings, appliances, etc., is ushered in. In time, manufacturers develop complete in-home selling programs for their retailers. (In early 1962, even some of the variety chains were beginning to send out in-home



crews and several department stores retained an outside firm specializing in in-home selling to operate a type of leased department selling cosmetics, hosiery, etc., to customers right in the home.) A discount chain gets the idea that the shopper would like to have her car serviced while she is doing her shopping. Pronto—the gas station discovers that it has a powerful new competitor. Even such corporations as Humble, Sinclair, Pure Oil, and Gulf have felt the reaction and have begun to develop plans early in 1962 to convert the gas station into an outlet selling nonautomotive merchandise. When 50,000 gas stations sell nonautomotive lines, it will have to be reflected in the marketing programs of a broad range of manufacturers—and of wholesalers, too. These incidents could be multiplied endlessly. What do they add up to? They add up to the inescapable conclusion that as the retailer goes—so goes the wholesaler, so goes the manufacturer. As the retailer thinks—so, in time, must the wholesaler and the manufacturer think. And, most importantly, as the retailer indulges in imagineering—as he comes up with grand concepts such as self-service (which certainly revolutionized the total world of marketing by manufacturers and wholesalers) as he comes up with small ideas, and as he hatches out hundreds of in-between ideas—the manufacturer and the middleman must begin to think, to plan, to act, to capitalize on these retail strategies, these retail innovations. Marketing by manufacturers and by middlemen doesn't start in their offices—it starts in the retail store! And the closer the manufacturer, or middleman, watches the retailer, checks his strategy, checks his ideas, checks his store innovations—and then applies this knowledge to the development of appropriate programs—that much closer will the manufacturer come to meeting planned sales goals. In connection with the middleman, it is significant to note that the food wholesaler was compelled by vast changes in food retailing to make enormously radical changes in traditional wholesale food operational procedures. Now the drug wholesaler finds that the revolution in drug retailing compels the wholesaler to turn to totally new selling concepts; even to cash-and-carry wholesaling. At this very moment, some important retailers are beginning to ask themselves whether it is really necessary any longer for the



shopper to take her purchases to a central check-out point or to a cash-wrap desk. Isn't it possible to plan a retail store in which the shopper sees merely samples—indicates her purchases by button pressing, or by inserting keys in a slot or by other mechanical electronic means? And isn't it possible to arrange this system so that, after the shopper has completed her shopping tour, her purchases are ready and waiting for her, plus a tape that recorded her purchases? This isn't a Buck Rogers dream. This is the next great step in self-service retailing. We already have several stores operating precisely this way. When the concept is refined, it will blaze across the retail scene—because it will cut retail costs enormously, will reduce shopper-employee pilferage sharply, will cut out-of-stock conditions, etc. And, when this comes about, the impact on manufacturers and middlemen will be just as enormous as was the impact of present types of self-service retailing. In a 1962 talk, Geoffrey Baker, Vice President of the Ralston Division of the big Ralston Purina Company, specifically declared: "Many of the major contributions onto which we grocery manufacturers have latched have been made in recent years by the retailer. I am referring specifically to developments in packaging, in point-ofsale techniques, and in other ideas developed by retailers to persuade customers to buy more and better products." This, then, is the fundamental reason for this collection of 1010 ideas that move merchandise more profitably. Each one of these merchandise-moving ideas was developed by retailers—by retailers inventorying every conceivable type of consumer purchases from specialties to staples. Each one was used by a successful retailer. Each idea has been used successfully. They were culled from a total of over 10,000 merchandise-moving ideas that we collected over a period of several years from retailers in every part of the nation. This is the cream of the idea crop. As we put these selected 1010 ideas into final form, even the authors were regularly impressed with how many of them have already been adopted or adapted by manufacturers and middlemen as the basis of marketing strategy. It would be no problem at all to pick out from the total over 200 retail-inspired ideas that have already shaped the sales planning of manufacturers and middlemen. And there is no question whatsoever that, over the next two or



three years, at least another 200 of these ideas will be reflected in the marketing programs of manufacturers and middlemen. In addition, these ideas will be used by manufacturers in their house organs edited for their customers. Here is a wealth of tested idea material for the usually hard-pressed house-organ editor. The ideas will also be used by manufacturers for training salesmen and for bulletins to their salesmen. After all, the function of the manufacturer's salesman today, and even more so tomorrow, is "resale" work, not selling work. In other words, his function is increasingly that of helping the retailer (and the wholesaler, too) to move his company's inventory. That demands ideas—a steady flow of practical ideas. Competing merchandise is dismayingly similar; prices are quite similar; it is no longer newsworthy that a product or line is being advertised. But the salesman who can bring competent ideas to his customers is in position to offer something that is different—and necessary—and valuable to the customer. What is more, it is imperative that the salesman calling on retailers know at least as much about promoting his particular line at retail— and know more, if possible—than the retailer. This is not common among salesmen. But the salesman who studies these 1010 ideas, ranging from the great strategic concepts to the everyday ideas, will be vastly better able to help his wholesale as well as his retail accounts to move more merchandise, more profitably. And that is the very heart and soul of a good deal of present-day selling by manufacturers' salesmen. (After all, most manufacturers today actually perform more retail functions on their lines than does the retailer—and these retail functions of the manufacturer must filter to the retailer through the manufacturer's sales force.) This is, if anything, even more true of the wholesaler's salesmen, the broker's salesmen, the salesmen for the sales agent, for the manufacturer's representative. The whole trend for these middlemen has actually been to take over more and more of the retailer's function—practically to run the retailer's business for him! Indeed, the very survival of the wholesaler and certain other types of middlemen depends on the astute, imaginative, and practical way in which they run the stores of their customers. This book could very well become a guidebook for the management of voluntary chains, cooperative chains, other wholesaler-retailer combina-



tions. And certainly, if there is one function that the wholesale salesman simply must perform, it is the function of bringing helpful ideas to his customers—new and still newer ideas, time and time and time again. Of course, we anticipate that retailers, also, will find this collection of 1010 ideas to be a strong right arm in the development of grand strategy concepts, and ranging down from there to everyday ideas that move more merchandise every day. Never before has the retail fraternity had made available a collection of 1010 tested ideas covering the broad spectrum from top-level strategy to store-manager concepts to stock-boy ideas, covering every field of retailing and every merchandise classification—interpreted and explained for broad application. It is entirely plausible to suggest that this volume could very well become a textbook used by retailers in their training programs for executives, for store managers, for rank-and-file salespeople. And we are hopeful it will also be made available to students of retailing in our universities as one method of seasoning retail theory with practical retail imagineering. It has been said that one of the most effective ways to develop ideas is to jump into the sea of ideas. Here are 1010 tested ideas that move merchandise—big ideas, medium-sized ideas, little ideas. Each one tested in use. Each one proved successful. Manufacturing executives, manufacturer's salesmen, wholesale executives and their salesmen, retail executives and store managers and their salespeople might benefit by donning a scuba outfit and diving into this sea of ideas. As for advertising agencies, publishers, the broadcast media—their lifelines are inextricably bound in with the retail function. Each of these factors operating in the world of marketing communications could benefit by jumping into this same sea of ideas. E. B. and Richard E. Weiss




Section 1. 32 "Grand Strategy" Concepts That Move Merchandise 1 2. 64 Ways Science Will Help Move Merchandise 121 3. 31 Master Strokes That Move Merchandise 133 4. 180 Tactical Ideas That Move Merchandise 165 5. 581 Everyday Ideas That Move Merchandise Every Day 231 6. 122 Infant Trends That Will Play Adult Roles in Moving Merchandise 277



32 "Grand Strategy" Concepts That Move Merchandise

The Coming Era of $10 Billion Retail Giants

When the A&P hit a $5 billion annual turnover rate, it marked the first time in this country that a retail organization passed that gigantic turnover total. Twenty years ago to have predicted that a retailer would achieve an annual volume exceeding $5 billion would have been rated as idiotic. Even ten years ago it would have been greeted with considerable skepticism in most retail circles. Moreover, Sears will—before too long—get close to and then move past that $5 billion annual volume figure. And it is not at all improbable that mergers now being planned will lead to several retail organizations with an annual volume reaching up between $2 and $4 billion. But this is by no means the end of the line so far as giantism in retailing is concerned. Not only will we have more, and still more, billion-dollar organizations in retailing, more and still more multibillion-dollar organizations in retailing, but the day is coming when we will have several retail organizations with an annual volume hitting a fantastic $10 billion rate!
Here Is Proof That It Can Happen:

And if you think that is impossible, we might point out that if an American retail organization were to achieve in this country the per capita volume hit by T. Eaton & Company in Canada, we would have a $10-billion retailer in this country right now. Yes indeed, Eaton's per capita volume in Canada, projected against our vastly larger population, would mean a volume in this country perhaps in excess of $12 billion! So, the multibillion-dollar era of retailing is here. And it promises to hit billion-dollar goals faster during the next five to ten years



than it did over the last five to ten years; and the rate in recent years has been amazing. Naturally, manufacturers will be profoundly affected by the emergence of true giantism in retailing. Clearly, the development of giant retailing has had a very powerful influence on all presold brands, up to date—and, as retailer giants assume still larger stature, their influence on all brands will become still weightier. How Real Retail Giantism Will Come About: Still larger—very much larger—retail organizations will come about through: 1. Mergers and affiliations. 2. The coming together of retail organizations from different fields. 3. The eventual appearance of a retail organization that will em brace under one corporate roof department stores, variety stores, drug stores, and food stores—large units and small units and every gradation in between. 4. The eventual appearance, under one corporate roof, of retail giants that will intensively cultivate an all-channel approach to the shopper—retail stores of all sizes located everywhere; telephone selling; in-the-home selling; selling around the clock, including Sun day in some communities; selling perhaps via new concepts of TV in the home; warehouse selling; vending machine selling; leased departments in noncompeting stores; development of new types of store locations. 5. And these developments will be true not only of the corporate giants; they will be true also of voluntary chains, co-op groups, and other forms of retail alliances. It is vital not to overlook the fact that in the food field the independent chains are about as large as the corporate chains, and this trend is now extending into the drug out let, the hardware outlet, etc. 6. In brief, we will have in retailing true corporate giants and true giantism achieved by independents by giving up parts of their independence through voluntary chains, etc. 7. The true independents will tend to become fewer and fewer.



What Giantism Means to Merchandisers: Essentially, the coming era of true giantism in retailing means that our present large retailers must look upon their present size as merely a stage in the march toward immense size. It means also: 1. That large retailers must turn increasingly toward nonmerchandising functions—corporate holding companies, mergers, real estate, etc.—for larger and larger slices of total net profit. 2. That retailing must make still better financial connections—the ready dollar will be one of the great tools of modern retailing. 3. That retailing must invite into the organization men of great financial and legal acumen—the era of merchandising control of mass retailing is waning! 4. That mass retailers must turn more to the engineer, to consult ing firms of infinite variety. In this respect, they must borrow a leaf from the experience of our giant manufacturers. 5. That mass retailers must, in particular, turn to automation and to electronic control. 6. That mass retailers must make retailing less and less dependent on manual labor. 7. That mass retailers must be able to compete for the most ca pable executives in every branch of business management. This means new incentive systems for executives and probably other per sonnel. 8. That the controller's function in mass retailing will become still more vital, but along new and more dynamic lines. He will no longer be the watchdog of the treasury but rather the executive who provides dynamic financial leadership.
A Look Back:

Many years ago, a great Supreme Court judge wrote an opinion dissolving the New Haven Railroad "empire." He was one of the greatest judges ever to sit on that august bench, yet in his written opinion he stated flatly that the New Haven organization of that era was too large to be managed capably by any man or group of men. Since then, General Motors has achieved a size that makes the New Haven "empire" of that day look like a toy pooch! It would be wise for merchandisers to take a similar look back,



because the fantastic growth of manufacturers is now about to be duplicated by mass retailers. And the figures of annual turnover that seem so unapproachable today will be the verities of tomorrow! Indeed, it is entirely probable that within ten years we will have more retail organizations of all types with a turnover exceeding $1 billion than manufacturing organizations that top that awesome figure! In brief, in the near-term future, mass retailing may become the big business of our economy! This will be quite a turnabout—and it will profoundly influence not only retailers, competitively, but it will also profoundly affect supplier relations. International Retailing: As one aspect of true giant retailing, there is every reason to believe that giant retailers will turn to the world as their oyster—not merely to our own country. Of course, Sears and a few others have already taken steps in this direction. But the present state of international retailing is a kindergarten state. Today, there is no retail organization that can boast of even a half-billion-dollar volume in foreign lands. Tomorrow, some of our giant retailers will be accounting for—each one—over $1 billion in their foreign outlets. When that happens mass retailing will again go through vast changes. Example: When a giant retailer achieves a great volume abroad, something will surely happen to the merchandise he imports into this country for his own stores operating within our shores. As a matter of fact, a complete revolution in the domestic retailing of imports will be brought about when giant retailers hit big figures in stores located abroad. And mass retailers who do not have these foreign sources will be at a competitive disadvantage. The End of the Family Era in Retailing: Over the last several years there has been a dwindling of large retail operations that are family owned. This process will accelerate. Family retailing will too seldom be competitive in this coming era of $10 billion retail organizations. It also will bring about new requirements of identity with the public. The larger retail organizations become, the more they tend to lose the local touch, the personal touch. And, while the shopper



will not object to the passing of some of the personal approach in retailing, its total disappearance is hardly in the cards—for the foreseeable future. Conclusion: Mass retailers have tended almost to drift into giantism. But from this point forward, mass retailers will develop long-term plans for growth toward volume totals that dwarf current figures. The era of truly great retail giants is not merely coming; it is here. And it is developing with extraordinary rapidity. Next stop—$10 billion retail organizations. Get ready for it.
Getting the Shopper to Shop More of the Store

One of the great problems of retailing today is to get the shopper to shop over more of the floors, more of the aisles. This is true of the department store—with particular reference to its upstairs floors and only to a lesser extent of its main floor, downtown especially. It is true of the food super, which finds that only a tiny percentage of its daily traffic ever walks through more than one-third to onehalf of its aisles. It is true of the drug chain, of the hard- and softgoods chains. And as practically all of the newer outlets of the mass retailers become larger and larger, the average shopper covers less and less of the total store area. The one-stop outlet cannot obtain the required number of onestop shoppers until it is able to induce more traffic to cover more of the store area. This is the basic route to a larger average ticket, and, without a larger average ticket, the giant one-stop outlets simply cannot throw off a satisfactory net. How can the retailer prevail upon more shoppers to shop more of the total store more of the time? Let's address ourselves to that fundamental problem, and let's start, as logic tells us we must, by asking ourselves why more shoppers don't expose themselves to larger store areas, more frequently. Why the Shopper Restricts Her Shopping Area: 1. Time is, of course, a great factor in this basic shopping problem. Shoppers have less and less time for shopping, and, more fre-



quently, they are less eager to shop. This tends to cut down the store area the shopper can cover. 2. The fatigue factor enters into the picture. Giant stores must con tend with a concrete fatigue factor on the part of the shopper—com plicated by the increasing tendency for women and men to shop with children. 3. The physical factor (as differentiated from the fatigue factor). Here we refer to the physical problem frequently involved when making more than one purchase. Even in the food super, it is com mon experience for a few large nonfood items to crowd the shopping cart, and making two trips through the check-out, out to the car, etc., is hardly attractive to many shoppers from any standpoint. Where shopping carts are not available, and where the purchases are take-withs, then the physical problem is indeed a taxing onetry it yourself, sometime. 4. The problem of locating floor personnel who may be free to serve the shopper. During peak hours, which is when the retailer pulls in the lion's share of his week's volume, this consumes so much time that the shopper simply cannot cover much of the total store area. 5. The impact of crowds during peak hours. Crowded aisles are both an advantage and a disadvantage. They certainly tend to cut down the shopper's "mileage" inside the store. 6. Poor visibility throughout a floor is also a factor—plus poor departmental signing, poor directory facilities. 7. Inadequate vertical transportation from floor to floor plays a considerable role. 8. The lack of excitement on so many mass retail floors, caused by excessively uniform displays, almost total dependence on the orderly display of vast areas of merchandise for attracting the shopper, and a paucity of exciting signing, is also a factor. 9. Poor floor layout that fails to encourage and smooth out traffic flow. The science of traffic flow on the retail floor is sadly neglected. 10. Poor housekeeping. In all of its aspects, poor housekeeping dampens shopping ardor, and shopping ardor is needed to get around a larger part of our new giant outlets. 11. Inadequate check-out facilities which consume an inordinate part of die shopper's limited shopping time, improper location of cash-wrap desks and other check-out facilities, archaic methods of



writing up orders, and archaic techniques for wrapping purchases also impinge on shopping time. These factors do not constitute the sum total of the obstacles that discourage the shopper from covering more of the store, more of the time. Improper merchandise assortments, poor location of departments, failure to relate merchandise categories properly, the common inability to get satisfactory locational help from salespeople, etc.—these and other factors make their contribution to the toorestricted travel of the shopper on too many of her shopping trips. But they surely total up to a sufficiently impressive showing to make it clearly evident that if one-stop outlets are to get somewhere nearer their theoretical goal of creating one-stop shoppers, much must be done. How to Increase Shopper Mileage inside the Store: Obviously, many—if not most—of the shopper problems listed above are self-answering when it comes to seeking solutions. Thus, when we remark that poor traffic flow layouts are one cause, the solution is obviously to make proper engineering studies that will smooth out traffic flow. Similarly, improved vertical transportation, better housekeeping, more scientific location and setup of check-out points and order books and wrapping, better signing, improved floor directories, etc., are all obvious objectives. But let's see if we can at least get the ball rolling on these and some of the less obvious trouble spots: 1. Stores that do not now have shopping carts—some that use baskets, for example—may find it wise to consider the shopping cart. And those that ordered shopping carts originally for small-ticket items may now be called on to order shopping carts that can trans port more bulky big-ticket merchandise. The motorized shopping cart may be on its way! 2. The whole subject of creating more merchandising-promotional excitement on the warehouse type of floor display calls for review. Merchandise set out as books are set out in a college library is not at all its own best salesman. 3. Maybe it is high time to give serious thought to the moving aisle—at least in some sections of the store. 4. Making a number of purchases under a charge-account system still takes too long—the writing done by the salesperson in order



books consumes so much time that it is impossible to make a number of purchases in a reasonable time. 5. The check-out facility is still entirely too dependent on manual operations. It is a horrible bottleneck particularly during peak hours. Ditto for the cash-wrap desk. More mechanical and electronic de vices—and more competent personnel—are required at these stra tegic points. 6. New arrangements for housekeeping are necessary. Depending on regular floor personnel for this vital function offers no hope for improvement. Housekeeping in the home is now serviced by highly efficient organizations; similar developments must come in mass retailing. 7. Facilities that will lessen the burden of shopping with children demand attention. These include nurseries, etc. 8. Store advertising, instead of being controlled by allowances, should be inspired more by concepts that will induce the shopper to cover more of the store, more of the time. Any check made of actual customers of many of the new giant store units will show that they have an amazingly foggy notion of the variety of merchandise classi fications available—and where they are located in the store. 9. Better facilities for making an inquiry within the store concern ing the location of wanted merchandise are called for—telephones, special floor attendants, etc. 10. The wiser use of extra personnel during peak hours demands deep study. Solve this problem and the shopper will automatically cover more of the store. 11. And, finally, we suggest that more of the time of various executives should be devoted to checking typical experiences—as shoppers—in making multiple purchases, in multiple departments and on multiple floors. And, for many executives this floor experi ence could be an eye opener. Conclusion: One-stop outlets demand more one-stop, or at least more onehalf-stop shoppers, more of the time. The mere addition of merchandise categories put out on open display won't solve this problem. But a concerted attack on it, from all of the fronts we have mapped, will surely help.



Your Uncommon Common Shopper

In his day, Baraum was right. A sucker was born every minute! Today, we still have shoppers who are easily misled. But we have fewer than in Barnum's day. And well have still fewer tomorrow. In brief—more shoppers are becoming more sophisticated more rapidly than ever before in the history of modern mass retailing. Our younger generations of shoppers in particular are keen—and their buying edge is being sharpened constantly. Question: Is the modern merchandiser as sophisticated as the modern shopper? The common shopper is becoming uncommonly smart. But some modern merchandising tends to continue to appeal to a low level of intelligence. So, let's address ourselves to the uncommon common shopper—after all, can there be a more important study for many executives than the customer? The New Era of the Sophisticated Shopper: All business executives are thoroughly familiar with the remarkable economic progress of millions of our families. These executives can pour out family income statistics in a never-ending stream— and these figures are, of course, happy statistics. But what about the cultural progress of the shopper circa 1962 and circa 1965? Ah, there's the rub! Few retail executives have pondered the simply fantastic uplift in the cultural standards of our people over the last decade. And even fewer have attempted to translate this remarkable social change in terms of modern merchandising. Now it so happens that, over the next few years, the cultural progress of the American shopper may outstrip his economic progress. Is this of importance only to social scientists, to eggheads? No it isn't. It is of great importance to merchandising. Why? Because the more knowing, the more understanding, the more sophisticated the shopper becomes—the more sophisticated merchandising must become. But when we look around it is self-evident that too much mass retailing continues to be directed at audiences that presumably haven't changed intellectually since the Indian medicine fakir strummed his guitar!



Shopper sophistication isn't merely marching ahead; it's leaping ahead. It is leaping ahead both qualitatively and quantitatively. It is in a stage of explosive growth. But too much modern retail merchandising continues to be premised, so very obviously, on the theory that a sucker is born every minute. What Is Changing the Shopper? Economic and social progress go hand in hand. The family that is better financed achieves a higher educational standard. It travels more. It reads more. It thinks more. It becomes more sophisticated. For most mass retailers, the bulk of their volume comes from approximately one-third of our families. These are the families with the larger incomes. These are the families—and note this well—who enjoy perhaps 75 per cent of this nation's total discretionary dollar. It is this discretionary dollar—this dollar available for wants above mere subsistence—that is the great target of all mass retailing. As we've just said, this discretionary dollar is lodged primarily among one-third of our families. And these are the very families that have become so much more sophisticated in their shopping! We have larger and larger numbers of our "shopulation" with higher education. In another decade, practically all of our younger people will be high school graduates. College enrollment, which has already jumped ahead fantastically, will leap ahead still more dramatically. Adult education, which right now has over 30 million enrolled, will be embraced by over 50 million of our people. Education and sophistication go hand in hand! The egghead is assuming a new position in our society. His very numbers make this inevitable. Once he was a queer—because he was so unrepresentative. Soon, the various degrees of eggheadedness will be so common among our people as to assume proportions of a norm. Why was TV rocked to its foundations recently by the quiz and other scandals? Answer: Because it underestimated the intelligence of the shopping public. Talk to newspaper editors (who are doing a vastly better job of reflecting changes in the sophistication standards of our people).



These editors know that their audiences are more sophisticated than were the audiences ten years ago. Comparison Pricing: Take the comparison price promotion. We wouldn't for a moment contend that it has lost all of its original persuasiveness. But certainly the more outlandish of the comparisons are not believed by the more intelligent shopper—and it is the intelligent shopper who controls the discretionary purse strings of the nation. Millions of intelligent shoppers even have an understanding— vague perhaps, but still a fair grasp—of "margin" and "mark-up." They know that mark-downs of 70 per cent are not quite likely! Yet, by and large, comparative price advertising by many retailers continues to scream its "bargains" to an audience that presumably is moronic—because only a moronic audience could accept some of these price claims. Another Example: This is now an age of credit retailing. But some retail merchandisers seem unaware that millions of educated shoppers have come to have at least an inkling of the cost of credit. An astonishing number of shoppers now know that credit may cost them 18 per cent, and more. (This is why one large department store recently announced a lower interest charge.) Indeed, even among the least fortunate among our people, knowledge of credit costs is spreading. This has become painfully evident to merchants operating old-style credit apparel stores in several parts of the country. These stores really made their profit on credit— and it was a generous profit based on mark-ups of 100 per cent and more on apparel. Most of these credit clothing chains are doing poorly because now even their customers can no longer be fooled; these customers are now turning to other outlets where credit charges are not outrageous. Other Examples: The more sophisticated shopper is beginning to wonder a bit about the benefits to her of self-service retailing. Some shoppers, for instance, are wondering whether the time, trouble, hazards, and costs



of car shopping raise a question about shopping in some self-service outlets. These shoppers are being heard to remark: "We have taken over much of the retailer's former function, but his margin is higher than ever before. Why should we continue to do it?" (Maybe this will start a shopper rebellion that will encourage more telephone shopping, more shopping by mail, etc.) Still another instance: Every retailer knows now that few shoppers today consider shopping to be entertainment. (Decades ago, shopping was one of the great entertainments of the week.) Today, it is generally looked upon as a bore and a chore! Clearly, a less sophisticated people were entertained by simple shopping; a more sophisticated people find their entertainment in other directions. This has led to faster shopping, to fewer shopping trips per week, to still more sharply peaked hours in retailing, and to nocturnal shopping (and in some areas to Sunday shopping). More sophisticated shoppers demand better design. They show signs of rebelling against the dictates of fashion—remember the rebellion against the chemise? They rebelled against cars that were too big; they clearly pressured the production of compact cars. They are beginning to rebel against excessive style obsolescence in many merchandise classifications. Conversely, they are flocking to the concept of style correlation in ready-to-wear, in home decor, etc. They rebelled against a standard diet. Because they are sophisticated they have accepted convenience foods, foreign foods, exotic foods. They accept new drugs immediately. The antibiotics were introduced more quickly than was aspirin! They are even so sophisticated that they now buy drugs not solely for cure, as was the case for centuries; they now buy drugs for prevention. Conclusion: No sensible observer of the modern shopper would contend that every last one is highly educated, sharp, sophisticated. That's sheer nonsense. But let's remember that when the early autos were introduced, millions insisted the auto was just a gadget. Today, our people accept space travel as being just around the corner! This marks the difference in sophistication.



Television came into homes faster than did radio. Stereo is coming into homes infinitely faster than did Edison's early phonograph. Home air conditioning is coming faster than did central-heating systems. People who bought strictly by the seasons now buy more and more out of season (a change that has yet to be properly reacted to by some retailers). Eye make-up came in many times faster than did lipstick years ago. (A sophisticated people accept change faster—accept new concepts faster.) A sophisticated people want better quality; they want to trade up. So—check into this new sophisticated shopper. Too seldom has basic strategy been adequately adjusted to the new requirements of these shoppers whose discretionary dollar is really the target of modern merchandising.
The New Importance of Secondary Locations

For the entire decade of 1950 to 1960 the great locational objective of most retailers has been to seek out top locations. This has taken the form of top location in the most modern shopping centers and top location in the most heavily trafficked highway locations. But in every decade there are only a limited number of the choicest retail locations. Consequently, not only has the rapid expansion rate of mass retailers, plus their concentration on one-stop outlets, brought about something of a scarcity in top locations—but the price for a top location is beginning to reflect a scarcity value. Now it is axiomatic in business that every headlong rush in one direction automatically creates a real opportunity in precisely the reverse direction. The opportunity in the reverse direction may not be as large, in total, as the direction that everybody is taking, but, since so few will take the reverse direction in the early stages, the "pickings" can nonetheless be extremely lush. The First Signs of the New Locational Trend: Consequently we began to see evidence of the beginning of a new interest in secondary locations for retailing—and even in tertiary locations. These include retail locations in run-down areas and in downtown and neighborhood sections from which other retailers are actually fleeing. They include less desirable shopping centers—bear



in mind that at least 75 per cent of the shopping centers opened over three years ago are now "secondary" locations! They also include the less desirable locations out on the highway. Indeed, on the highways some solo locations have proved out beautifully which, by traditional standards, would have been termed "dogs." Several newly organized chains have achieved a fantastic growth in just two or three years by deliberately avoiding the best locations; these new low-margin chains won't accept a top location as a gift. They seek the run-down location, the has-been location. They will even take locations where parking may be difficult if not impossible—and, even in these presumably "impossible" locations, they turn in amazing volume performances. What is more, several food, drug, and variety chains are experimenting with secondary and tertiary locations. For these down-atthe-heel locations these chains are developing special store blueprints that involve a total outlay considerably under the cost of their luxurious new giant units in top locations. They figure that the low site cost, low rental, low building cost will enable them to turn in a satisfactory net on a fairly small volume. As a matter of fact, a number of downtown sites that "nobody wants at any price" have been taken by some of these new lowmargin chains and operated with great success. Moreover, some of the great established chains are developing new programs for the rehabilitation of some of their poorer downtown units that entail low costs but which achieve modern appearance and modern efficiency nonetheless. A Historical Look Because memory is both faulty and tricky, we tend to forget that the original downtown location, especially in the larger cities, was not a top location in innumerable instances. Thus, when the first several department stores in New York, several decades ago, moved up from 14th street and 18th street to 34th street—those 34th street locations were not then top locations. Naturally, when the big stores moved to 34th street, they automatically rated up the area, and, as more stores followed them, 34th street West became a choice location. But die first move to 34th street involved what was then a secondary location; it became a prime location only later. Similarly, when some top stores moved at later dates up to Fifth



Avenue locations at 50th street and then farther north on Fifth Avenue—those were not then choice locations. Again, when Sears adopted the policy, several decades ago, of locating on the outer periphery of great retail trading areas, it was clearly moving into secondary locations. This turned out to be one of the most successful store locational programs of modern times— but too few in retail management remember that this remarkable program was based explicitly on a flight from top locations. It has also been forgotten that the first food supers were opened in locations and buildings that defied almost every retail tradition. Those early food supers opened in abandoned garages and movie houses in the Great Depression of the 1930s. These were in many instances the poorest kind of retail locations—lower even than third rate. But they brought in traffic! Similarly, when Frank Woolworth and J. C. Penney opened their first stores they were not interested solely in top locations. Indeed Woolworth in particular could not get into some top locations in its early days for the same reason that it could not buy from some top suppliers (who lived to regret their decision!). Again—think back to the "pineboards," those crude outlets that marked the start of the drug chains. Those pineboards seldom got an "A" location. A More Up-to-date Look: We have already referred to the new low-margin chains (in soft goods particularly) that will not accept a choice location rent free. There are other examples of retail locational policies premised on a disregard of top locations. The farmers' markets seldom enjoy a location that can be compared with a great regional shopping center. But hundreds of these farmers' markets do extremely well. The new store locations in railroad and bus terminals were not originally considered to be "A" locations (although some have since acquired top rating). But those merchants keen enough to assay the true value of these transportation locations have enjoyed a distinct competitive edge. We mentioned the highway location. Thousands of merchants have opened successful stores in highway locations that even five



years ago would have been considered as totally lacking in store potential. These were, indeed, the lowest rated store sites. They still offer many "bargains,** especially to the retailer who does not limit his highway sites to the choice interchange locations. The hotel store has only recently come to be recognized as a location justifying a high rating. Ditto for the hospital store. More Mobility: It is trite to say that our shoppers are more mobile than ever before in the history of modern retailing. But maybe because it is so trite, it tends to be overlooked when appraising retail locations. In other words, the tendency is to rate retail locations on the basis of shopper habits that may have been correctly analyzed some years ago when these standards were fixed, but which no longer have the same degree of validity. Shopper mobility tends to demolish these fixed concepts, but too often those who fixed these concepts try to close their eyes to shopper mobility. Shoppers will travel 20 miles today to shop—and think nothing of it. Shopping trips of 30 miles and more are by no means unusual anymore. And, when our great new highways are finished, shoppers who now travel perhaps no more than 20 miles to shop will travel 30, 40, and even 50 miles. We forget, too, that our working population has become extraordinarily mobile. Millions of workers now travel daily by car from 20 to 50 miles each way. They include women as well as men; and bear in mind that male shoppers are increasing enormously, and they, too, compel changes in established notions of locational ratings. And, finally, we forget that the vast increase in shopping after 4:30 P.M. has necessitated great changes in locational concepts. Twenty years ago, not over 15 per cent of our total retail volume was done after 4:30 P.M. Today, over 50 per cent of total retail volume is done after 4:30 P.M. Nocturnal shopping has changed locational sleepers into top locations! (If downtown were open six nights a week it would not need malls to protect shoppers from traffic because vehicular traffic downtown is at a minimum at night.) Nocturnal shopping also adds to and benefits from mobility—shoppers can get to places at night with their cars that they could not reach years ago by mass transportation.



Playing It Safe Can Be Expensive: There may be too much formula in the selection of retail sites. And, while following a site locational formula may appear to be playing it safe, this safety may be bought at a prohibitive price. Formulas are based essentially on past experience. Real estate formulas in particular tend to worship the past. But retailing itself is in a state of ferment never before experienced. This is because the shopper is more "open to buy" new retailing concepts than at any previous time. The consequence is that locational "dogs" are changing, almost overnight, into highly desirable locations. But equally important is the new realization that when a store is smartly planned—architecturally, merchandising-wise, promotionally—with a specific relation to the location, then it may be that these techniques can be made to more than balance out any locational weaknesses. Conclusion: Basically, the mobility of the shopper has made almost any site that can be conveniently reached by the shopper, especially by car, a potentially desirable retail location. Basically, the pat locational formulas are no longer quite so pat. Basically, the shopper will go almost anywhere if the value offered, plus perhaps the service, conforms to the shopper's concept of what is wanted or desirable. A retail location, in other words, that by traditional standards may be poor can house a highly successful retail operation if the total store is properly geared to the requirements (and the opportunities ) of the location.
Service Is Not Dead

Service is not dead; it is simply moribund. It's anemic, apathetic, and pathetically dismal. Service is not inimical to mass retailing. Service is a necessary part of mass retailing. And service will come back to mass retailing. But when it returns, it will come back in startling new forms. Moreover, it will be service at a profit!



And, oddly enough, its return will be speeded by the low-margin retailer! Why? Because the low-margin retailer rightly looks upon entertainment as a vital factor in mass retailing today. He is bringing back fun into shopping—with fun centers, with miniature circuses for children, with hookups with bowling alleys, skating rinks, miniature golf courses, even facilities for fly casting with live fish as the prize. Entertainment is a part of retail service. It was a part of the services of large retailers years ago—remember the concerts in store auditoriums decades ago? So, with entertainment leading the way—entertainment of modern types—service is destined to stage a comeback in mass retailing. But it will be service of a new type—service involving new concepts. As for Example: This is the point where readers are privileged to ask: "As for example?" Well, in providing the examples, we would like to preface the incidents that follow with these two comments: 1. Each of the services enumerated in the paragraphs that fol low is being provided by one of the great stores of the world. 2. We propose withholding the name of the store until the con cluding paragraph—because we think that, if you are overwhelmed by some of these service ideas, you will be still more overwhelmed when you read the name of the great store that provides these serv ices, and manages to turn in a neat profit report, too! Now—for some of the unique services being offered to its customers at this very moment by one of the outstanding department stores of the world: 1. For a bridal couple, in addition to the typical bridal registry, it will book honeymoon tickets through its travel bureau, and arrange for automobiles through its car-hire service (including chauffeur if desired)—and it should be noted that even Sears is just now com ing to some of these particular services. It will also make photogra phers available from its Portrait Studio. 2. It offers a gigantic catering service—anything from a small formal dinner to a huge banquet. And it will also stage a reception that includes everything from wines to waiters, from silver to furni ture. 3. Its lamp department will send an expert in home decor up to



50 miles from the store to advise on the proper position for a lamp— and the expert will also advise on electrical details; no charge. 4. Its special children's library sterilizes every returned book to lessen the possibility of mumps, measles, etc. 5. A proud boast of its telephone service is that "you can order the bacon at 4 A.M. and have it delivered for breakfast." 6. Its pet shop isn't just a tiny little section. Indeed, it's called the Zoo. It includes over 200 varieties of animals, birds, and fish. It sells a blue macaw at $700. It has sold bears, chimpanzees, and filled an order for a camel at $1,456. Every conceivable pet service is offered. 7. Its lending library includes over 150,000 books—and its proud boast is that no title is ever out of stock. Customers have their own librarians who pick titles for them and deliver the books. 8. Its sporting goods department includes a fine miniature golf green and a golf pro who gives instruction—free. 9. Its school service advises parents on school apparel—and its word on this subject is the last word. 10. It has kennels, where it houses customers' dogs—free—while the customer is shopping. (Ever hear of that before?) 11. It includes a bank that remains open whenever the store is open. 12. It even separates listening booths for Pop fans and Classical fans—they are kept as far apart as possible. 13. It has its own auction rooms—auction retailing is on the rise. 14. It even has an escort service—if a hostess needs a man in a hurry, the man will also be provided. The list is almost endless. One might ask: Is there anything this store doesn't offer by way of service? And the answer is: Probably not Moreover, when they hear of a service they are not currently offering, it isn't long before it's added. Now—what is the name of the store? The name is Harrods—Harrods of London. London, England. Does It Pay Off? Does this remarkable range of service pay off? Harrods says "yes— emphatically yes." And that despite the fact that most of the services are free. Does Harrods take a longer margin than do major stores here in the States? No.



Does Harrods worry about low-margin competition? Not particularly. So—Restudy Service: Yes—take a new look at service. Reexamine all traditional services. Reexamine them from at least three viewpoints: (1) to determine whether they are worth continuing in any form, under any circumstance, (2) to determine whether each service can be modernized, improved, changed for the better, refined, made more dramatic, (3) to determine whether old and new services can be charged for—and how much. Bear in mind that credit is one of the outstanding store services. And when both Sears and Ward adopted a no-money-down credit policy in April, 1961, they really challenged all other forms of retailing either to duplicate that type of credit service, and/or to offer other and perhaps even more attractive refinements of present credit programs. With every mass retailer offering a credit service—including the discount department stores—credit per se is no longer much of an inducement. A competition in credit services is clearly developing—rapidly. Then, having really put your traditional services through the wringer—check into the newer services being offered by stores everywhere, including stores in some countries abroad. It is interesting to note that Harrods, in London, is offering some services (such as a travel service) that some of our big retailers are just now beginning to adopt. So it is entirely possible that service ideas that are new can be picked up abroad. Check Discount Stores for Services? Yes! Take a new look at the low-margin outlets. Most mass retailers, when they study the newer low-margin outlets, either view them through the dark glasses of bitterness, or concentrate on their low margins. Few traditional retailers seem aware that some of the newer discount retailers offer services of a type that is extremely appealing to many shoppers. As we mentioned earlier, the discount department stores are leading the way in bringing back fun into shopping. And that is a service—nothing else. When a discount store opens up a shopping center that includes a skating rink, a swimming pool, bowling alleys, miniature golf, or a putting green, it is once again making shopping



fun. And it should be noted that each of these "play services" is planned to operate at a profit—and each one usually turns in a net profit. So these newer forms of mass retailing are developing new concepts of service that not only are appealing, that not only bring in traffic, but that are actually contributors to net profit. Decades ago, services offered by stores were almost all offered gratis. But starting perhaps 20 years ago, stores began to charge for some services—on deliveries, for example, under a certain minimum. More and more stores have since charged for more and more services. The net result is that the shopping public has been conditioned, as never before, to accept the basic idea that services should be paid for. Consequently, charges for services will be much more easily made to stick than would have been the case several generations ago. Moreover, more of our shoppers are quite sophisticated today. They tend to comprehend that there can really be few "free" services—they usually know nowadays that every service must eventually be paid for, in one way or another, directly or indirectly. And many shoppers would rather pay for services directly—or have the privilege of foregoing the service. Conclusion: Services originally were overhead. Today, services can be net income. This means that retailing can once again turn to services—and that retailers can merchandise services precisely as they merchandise inventory.
Could Shoppers Buy Faster in 1952 than in 19627

In mass stores as of this moment, can the shopper really buy faster than in 1952—ten years ago? Indeed, can today's customer shop faster than grandma did when, as a young-married back in 1928, she read off her want slip to a clerk who functioned from behind a counter? Sound like silly twin questions—don't they? But are they really so absurd? Do present-day shopping facilities really save time for the shopper? Or is it not merely possible but actually probable that the slashes in shopping time originally achieved by modern retailing techniques are now in the process of being washed out?



Let's see: 1. In 1952, delays at the check-out points or at counters were less time consuming than is true today. There are few outlets that can accurately contend that, in 1962, less time is required than in 1952 to pay for the purchase and to have the purchase wrapped. Waits at check-out points today tend to be longer than waits for salesperson attention back in 1928! 2. In 1952, most store units of mass retailers were smaller. Less time was required merely to walk through those smaller units to make purchases than to make precisely the same total purchase today. And, of course, this was even more true way back in 1928. 3. In 1952, inventories of most mass retailers were not only less diversified by categories, but assortments were smaller, brands were fewer, price lines were fewer. The larger the total inventory, the more time required by the shopper to find wanted items and to make a buying decision. In 1928 this was even less of a time problem than it was in 1952. 4. In 1952, retailing was not so amazingly concentrated into a few peak hours as it is today. Retail inefficiency is at a peak during these peak hours. Also, crowded aisles slow down the shopper—so does the need for doubling back because a section is jammed with shoppers or shelves are bare, etc., etc. Peak-hour shopping in prac tically all mass stores requires more time in 1962 than in 1952. And since in 1928 peak-hour shopping had not become nearly so concen trated as today, this time problem was then of minor importance. 5. In 1952, neighborhood shopping was more common than in 1962. Neighborhood shopping took less time than shopping center shopping because the latter involves getting the car out of the garage, driving some miles to the center, parking, walking to the store a distance sometimes equal to the distance from one's home to a neighborhood store—and then there is the time involved in leav ing the center and getting home. In 1928, neighborhoods were the shopping centers. Shopper Time Savings Are Ebbing Away: Maybe the comparison with 1928 is not entirely valid—although it has some merit. But it seems quite proper to conclude that somewhere around 1950 mass retailing had reached its maximum achievement in saving shopper time. Since then, time saved at the spigot is more and more being wasted at the bung!



It still takes too long to pay for the purchase. (Even order books are time wasters.) It still takes too long to have the purchase wrapped. It still takes too long to get the purchase out to the car. It still takes too long to get in and out of some parking lots—especially at peak hours when shoppers must circle and circle around to find a parking stall. Someday, a large retailer will trail a cross section of its shoppers with a stop watch. And that retailer will clock the time involved in each step of the typical shopper's schedule of movements involved in a shopping trip—travel time, parking time, walking time to the store, time spent in the store (section by section) in assembling purchases, time involved in paying for the purchases and taking them out of the store or arranging for delivery, getting the purchases up to the home, and, finally, getting the purchases into the home. The resulting figures will be eye-openers and leave little room to doubt that so-called high-speed shopping, when properly analyzed, is not high speed at all. It's been said that, in our big cities, the horse and wagon made at least as much speed as the present high-speed auto and truck. Similarly, in 1952, the shopper made somewhat faster time in shopping than she does in 1962—and, in certain instances, she could shop faster in 1928 than in 1962. Now this is—or should be—of real interest to merchandisers for several reasons. A major reason is that, today, all large retailers are so much alike in store architecture, store size, store layout, store fixturing, store inventory, store service, and store location that there is a desperate need for brilliant new concepts that will restore to large retailers some of the distinctly different and superior characteristics that were originally their trademarks. Maybe this major point of difference will be found in the development of a program that will involve a truly major slice in the total time required for shopping—especially at peak hours (we say "especially at peak hours" because these few hours will become still more acutely peaked). Certainly the mass retailer who can say "we have made it possible for you to shop in comfort faster than you can shop in any other outlet—from the moment you leave your home to shop until you return with your purchases" will have a major selling argument and a point of differentiation. (Incidentally, the more time the customer saves when shopping —the more time that customer has for shopping. For example, at



least 50 per cent of the shoppers in mass outlets during peak hours buy from 25 to 50 per cent less than they set out to buy—and some make no purchases at all because their time has run out. So this achievement of cutting down total shopping time involves more than merely a distinctive service—it can increase the average sales check and that, of course, is the royal road to a better retail net profit percentage.) How Can Time for the Shopper Be Saved? There are many ideas that offer hope for saving shopper timeranging from major ideas to minor ideas. Let's list them, but not in any particular order: 1. Maybe it's time to think more seriously of improvements in the parking lot—moving sidewalks, for example, improved pick-up sta tions, methods for moving traffic more efficiently, better layout to bring the shopper nearer the store, etc. 2. A few major retailers are experimenting with small store units. Properly located, properly stocked, properly set up (including per haps true drive-in or curb service facilities ) they may provide a ma jor answer to the shopper's time problem. 3. The application of modern engineering techniques to assem bling orders, wrapping orders, and getting orders out to waiting cars. Order books can be simplified—so can all of the other proce dures involved in recording the sale, checking credit, etc. The proc ess of writing out orders with customer name, etc., etc., is painfully archaic. Electronic tabulators will play a role in this connection. 4. New floor layouts that will simplify the location of wanted merchandise and that will speed traffic—maybe the store-in-theround is one of the answers. 5. Improved signing can be quite a help. Section signs, for ex ample, tend to be inadequate. 6. Improvement of the shopping cart and the shopping basket. Getting purchases out of the shopping cart and onto the check-out apron, for example, is an almost ludicrous procedure—not only time consuming, incidentally, but backbreaking as well! (It might be re marked here that shopping in some of the new self-service units of some of the drug and variety chains where even baskets are not provided is a chore that challenges the patience, the skill, the muscles, and the time of the shopper. One wonders whether the ex-



ecutives of these chains have ever made a shopping trip themselves of their stores and tried to balance more than two purchases in their hands and then waited in front of a jammed-with-merchandise cash desk while an inefficient cashier tries to ring up the purchases.) 7. Maybe it's time to check into new store locations. Perhaps loca tions out on the highway will not only save time for the shopper, as compared with shopping-center locations, but may offer other advantages as well (there is reason to believe that the big locational trend in mass retailing is out on the great new highways now building or planned). 8. It is not impossible that telephone ordering will stage a come back. Right now one food super reports considerable success with a program that involves telephone shopping exclusively. Certainly telephone shopping can be a great time saver for the customer. Ditto for mail order. Conclusion: The essence of modern shopping is time. This is particularly true when we bear in mind that few major retailers today offer anything unique in values or service. The shopper has less time to spend on shopping, and the shopper intends to spend less time shopping. Moreover, the shopper intends to make fewer and fewer shopping trips—and simply must be enabled to buy more in less time in these fewer shopping trips. Ever since roughly 1950 the great changes in mass retailing— larger stores, larger inventories, larger shopping centers, larger distances from homes—have all combined to reverse whatever trend may until then have decreased shopping time. Now there is a real opportunity for some mass retailers to develop a unique advantage by developing a practical, broad, brilliant program for enabling the shopper to cut down her total shopping time —her portal-to-portal time. It can be done. And we suspect it will be done.
Needed: An Improved Batting Average on New Products

The introduction of new products by manufacturers in every category will be at a constantly stepped up pace. The gigantic investments made by manufacturers in scientific product research, the



mounting pace of competition, the common objective among manufacturers toward fuller lines—these and other factors make it positive that the retailer will have to contend with an ever-cresting flood of new-product offers. And competition among retailers will necessitate a careful consideration of most, if not all, new products. No retailer can afford to be an also-ran in the introduction of new items of merit. But the introduction of new products by the retailer involves substantial expenses. A low batting average, consequently, can easily make the whole new-product operation a loss operation (few retailers have any notion of their net-profit-performance on new products). Management Policies Are Needed: For these reasons, many merchandisers are devoting concentrated attention to the development of new policies that will accomplish the following: 1. Encourage manufacturers of desirable new products to con sider a specific retail organization tops in new-product introduction 2. Reduce the expenses of new-product promotion 3. Reduce the number or percentage of duds 4. Build a larger total volume on new products—at a higher net profit percentage Are New-product Committees Old Fashioned? The New-product Committee—in one guise or another, under one name or another—is, of course, one of the basic procedures adopted by many types of retailers to achieve the above four objectives. But some managerial executives of large retail organizations have, of late, begun to wonder whether new-product procedures—even where centralized under a New-product Committee—are the ultimate answer to the problem. And the more they have wondered, the more inclined they have become to conclude that the New-product Committee (under whatever guise it may function) tends to have these weaknesses: 1. It tends to lack specific directives for the consideration of new products. 2. Or the directives it has received are painfully inadequate.



3. Or the time the members of the committee, or whoever may be involved in new-product consideration, can spend on new-product analysis tends to be one more case of "too little, too late." The time factor is, of course, primarily an organization problem. But it is also true that better directives for new-product consideration could not only improve the aim of the buyers—but could cut down the time factor. A 35-point Check List for New-product Consideration: How then might a retail organization arrive at a higher standard of directives for guiding new-product decisions either by a store group or by an individual buyer? Clearly, the ultimate set of directives will vary as between one type of department store and another, between a drug chain and a food chain, a variety chain and a hardware chain, a soft-goods chain and an appliance chain. But as we examine what management executives are lining up as the basic essentials to be looked for when considering a new product, we find an interesting similarity in the basics. From department stores and chains in every field we have compiled the following fundamentals, which management executives have become convinced should guide new-product buying decisions: 1. Does it offer something new and exciting to promote? 2. What additional costs will we incur if we add this new item or line? 3. Does the new item or line offer substantial volume potentials? 4. Does it largely duplicate items, or sizes, or prices already stocked? 5. What about quality standards? Will the customer get a good value? 6. Will we get an exclusive? Do we want an exclusive? If so, what kind and for how long? 7. Can we be assured of adequate inventory? How about reorders? 8. What are the terms? Discounts? Mark-up? Other details? 9. Is a special deal involved? What are the details? 10. Does it carry a strongly presold brand? If not, what will the supplier do to presell it? 11. What are the details of the advertising program? 12. What are the details of the retail promotional program?



13. Is cooperative advertising offered? Any other alowances? 14. Does it fill a genuine need? Is it truly superior in a demon strable way? 15. Does the suggested retail price offer a better consumer value? 16. Will it be "opened up" promptly to other types of retailers shortly after we help to put it over? 17. What about the package? 18. What about fixtures? 19. Are the requirements on the initial order economically sound from our viewpoint? 20. In how many of our stores should we put it initially? Does the supplier have a specific testing program? Are we in a position to work intelligently with that testing program? If the test fails, to what extent will we be involved? 21. Will any sticky inventory be returnable? 22. What are the new profit potentials? 23. What about the integrity of the supplier—what have been our past experiences with this company? 24. Will the new item simply switch volume from present inven tory or will it, in whole or in part, represent additional volume? 25. Does it fit in with our trading up program? 26. Are the new virtues of the item or line easily recognized by the shopper—or do they require demonstration? 27. What is our inventory of similar or competitive items? 28. Are we getting in on this too early, too late? Should we wait for "calls" for the new item? 29. Will we have to throw out any part of present inventory to make room for the new item or line? 30. Will it add to our average sale? 31. Are any case histories available on what the new item or line has done in a few other outlets? 32. What local advertising will appear in our markets? Local ad vertising is vital for new products. 33. What specific economies are offered—handling economies, transportation economies, warehousing economies, etc.? 34. Could the new item or line take us out of a bad price-slash ing situation? 35. What can we expect per store, per square foot, rate of inven tory turn, etc., etc.



Obviously, all of these questions would not be flung at all newproduct proposals. But it is highly worthwhile to run down that list of 35 questions and mentally compare it with the new-product buying procedure that is typical in any organization—and for this reason: Such a comparison almost inevitably leads to the conclusion that solid new-product procedures are almost nonexistent or are largely inadequate. Even in chain stores, which have formally organized New-product Committees, these 35 questions have spotlighted the fact that the committee usually considers only a few of the fundamental points. Conclusion: One large retail organization arranged to keep a precise check on major new-product introductions by its stores during one year. Results were quite shocking. It was found that the end result on the major new products promoted during the year was a tiny net profit —a net-profit ratio smaller than on established lines! And management concluded that the basic cause of this unsatisfactory showing was lack of sound directives to those responsible for new-product decisions. The increasing flood of new products that will come on the market over the next several years can be a problem to large retailers —or a fine opportunity. Which it is to be will depend, in considerable measure, on the soundness with which a check list is drawn up by management to guide line executives in their new-product buying decisions.
Why Multiple Locations for Some Items and Lines?

Every mass retailer—department store, food chain, drug chain, variety chain—is giving an increasing number of brands, items, and lines multiple locations, displaying these brands and items in more than one section. Department stores tend to call these multiple locations "outposts." The chains tend to call them "related" displays. Why this broad trend to break down departmental barriers? Let's see: 1. The spread of increasing degrees of impulsivity in the shoppers' purchases of more and more merchandise classifications: The more impulsively the shopper buys, the wiser it is to expose fastmoving items to her more frequently.



2. The increasing speed with which shopping is done: The speed ier the customer shops, the more likely she is to walk by a display. But she may not walk by the second display, or the third. 3. The general requirements of the broad trend by all major retail ers toward the department store concept: This creates many more opportunities in many more outlets for related selling—and that often involves multiple locations for an item or line. 4. The really amazing similarity in the current inventory of our mass retailers: As these mass retailers added new merchandise clas sifications, and as they all turned toward known brands in these new categories, it became inevitable that their inventories would achieve a striking similarity. The newer store units of the food supers, the drug chains, the variety chains, and the discount chains tend to stock much the same merchandise, much the same brands, much the same price lines—in more and more of the total number of merchandise categories. Moreover, these startlingly similar inven tories are displayed in stores that are, architecturally, very similar, and in fixtures that are remarkably similar. This has compelled these retailers to strive for points of distinction, for points of differentia tion. Individual ideas involving more flexibility in traditional de partmental rigidities give at least a modicum of individuality. 5. Shopping in giant self-service and self-selection units with mer chandise out on open display tends to become too automatic: There are too few of the necessary interrupting notes, as the shopper walks down bowling-alley aisles lined with meticulously precise displays. An item or line presumably out of place, in this kind of setting, at tracts an extraordinary amount of attention, almost stops the shop per dead in her tracks. (We will cover this facet in more detail later.) 6. Some of the newer merchandise classifications added are not stocked in either breadth or depth: Instead, merely a few fastmoving numbers may be inventoried. Consequently, there may not be a large enough stock to constitute a "department"—and these miniature inventories fit in well in highly specialized "related" dis plays that may be somewhat removed from the "parent" department. 7. The enormous size of the newer store units, combined with the acute shortage of shopping time, points to the advisability of en abling the shopper to buy related items, or even unrelated items, without being compelled to walk miles and miles: Why should the woman who is buying coffee, and who needs a percolator, be com-



pelled to trudge from one end of a giant store (and maybe down and up stairs) in order to make the twin purchases? This matter of shopping time plus shopping fatigue is a critical element in the current merchandising scene at retail. Multiple-locations for certain items and lines can turn these disadvantages into advantages. 8. As mass retailers add more merchandise classifications, it is vital that more shoppers in these stores make more purchases—and buy a larger average ticket: If the average sale does not rise, then the net profit percentage is not satisfactory. And, with few excep tions, this broad trend toward more departments in mass outlets has not resulted in the anticipated increase in the number of trans actions in total, or in the anticipated increase in the average ticket. 9. Imitation of the food super: The food super, which has led mass retailing in so many ways, has done more than most other large retailers to stage related food promotions. The basic principle of related promotion has been sufficiently exploited by the food super to suggest to other outlets, which ape the food super, that related merchandising via the multiple-location route might be de sirable. 10. Large retailers have come to understand that the competition they do not give themselves will be given to them by their rivals: Thus the department stores eventually learned that they did not prevent a drain on main-store volume by refraining from opening branch units—competitors in the suburbs took volume from them just the same. Similarly, store management now tends to accept the conclusion that—within its stores—it may as well give its regular departments competition by giving certain items from these regular departments multiple display. Mass retailers have found, generally speaking, that the volume done in an outpost display seldom cuts into the volume done in the regular section. This tends to be largely, if not entirely, extra volume—and therefore highly profitable extra volume. Some retailers have reason to conclude that the secondary and tertiary locations tend to function to a degree as "reminders" to the shopper—who, perhaps not satisfied by the meager outpost offering, seeks out the regular department in which to make a pur chase. 11. Delaying the shopper: Retailers are finding that these multiple locational displays keep the customer in the store longer—a clearcut gain in this age of less-time-per-shopping-trip.



12. The shoppers* tendency to use shopping lists less and less: Or put that another way—shopping lists tend to become smaller and smaller, because they tend to include only the staple purchases. Multiple locations encourage the shopper to buy those items that are wanted but not listed, half wanted, quarter wanted. 13. Poppa is doing more shopping: Food stores report that over 30 per cent of their traffic consists of men—and during late after noon and evening hours and on Saturday the percentage of male traffic in the food super is much higher. Variety stores report a posi tive increase in male traffic. Drugstores, which have always had a large male traffic, report a further jump. Department stores have a much higher percentage of male traffic than ever before—espe cially in their suburban units and especially during certain nocturnal hours and at week ends. Poppa is a much more impulsive shopper than Momma. And multiple locations cater effectively to the im pulse shopper. 14. Cutting the serious loss of volume that occurs among our mass retailers during their peak hours: Lump together the total volume done by department stores, variety stores, food stores, and drug stores—that is, the new giant units of these mass outlets—and it will be found that at least 60 per cent of their total week's volume is done during 12 store-open hours. These are the hours when walk outs and half-walk-outs and quarter-walk-outs reach their highs— among other reasons because the counters or bins or gondolas in the regular departments are so crowded. Multiple displays help make an extra sale during these enormously important peak hours—a gain of decided value to mass outlets. 15. The family is shopping more and more as a unit: Where the family walks through the store, the multiple-location concept ex poses them more frequently to reminders of current needs—so that, with more frequency, one or the other of the family members is apt to recall and point out to the others a needed purchase. With the family right there as a group, the decision for the extra purchase is made more easily. When the family splits up in a store there is a competitive rivalry of sorts that is well capitalized by multiple dis plays. 16. Smart retail merchandising has always consisted in—among other factors—giving top location to items in season: Many years ago merchants placed special tables near the store door featuring "spe-



cials" taken out of a regular department. The modern multiple-location concept is simply a modernized extension of that age-old proved practice. 17. The store-wide promotion: Many years ago department stores developed the so-called "store-wide" promotion. They displayed an item or line in many parts of the store during the event. During the lush war years that practice almost disappeared. Now, on a highly modified basis, it is staging a return engagement. The store-wide promotion is simply another facet of the basic concept of multiple location. 18. Multiple locations permit the use, at times, of floor space that might not lend itself to full departments: Every square foot of space picked up in this way can be extremely profitable in this era of extraordinarily high square-foot costs in new store units. (In down town locations, outposts on the main floor permit faster shopping by noon-hour shoppers—a decidedly important factor.) Conclusion: The fundamental objective of mass retailers today—especially in one-stop outlets—is to sell more to every shopper in the aisles, to lift the average ticket. The shopper is quite willing to cooperate— impulse buying is the rule, and impulse buying means that more shoppers will buy more—if they are properly persuaded when they are in the aisles. A hugely effective persuader to the shopper in the aisles is the appealing display of merchandise, and, therefore, by displaying in multiple locations those categories that appeal most persuasively to the impulse-shopping fervor, the average ticket is lifted. That is the sum and substance of the breaking down of rigid departmental barriers. It is an enormously important development.
What Will the 3-day Week End Mean to Merchandise Turnover?

A director of the highly conservative Twentieth Century Fund predicts that, by 1975, we will have a 32-hour, four-day work week. This prediction was not yanked down from the ceiling—it was based on a precise study of man-hour productivity and its relationship to the work week. What will a 3-day week end mean to distribution?



It's a fascinating subject to explore. And not too remote to warrant spending some time with it right now. As a matter of fact, it is entirely probable that—within jive short years—a considerable body of workers will be enjoying a 3-day week end. The rapid introduction of automation techniques into factory and office will bring that about—and, in this connection, bear in mind that only a few years ago the very word "automation" was practically unknown! Moreover, bear in mind that—at this very moment—many people have 3-day week ends either for a part of the year or year round. For example, any number of people who own week-end places are taking their vacations in extended week ends. Moreover, in the larger cities, it is becoming common practice for people to leave their places of employment earlier and earlier on Friday in order to escape the outward week end traffic jams, and they are returning later and later Monday morning for the same reason, thus having a 3-day week end to all intents and purposes. In brief, the 3-day week end will not become a sudden overnight reality at the crack of dawn on January 1, 1975. It will sneak up on us with each passing year, and it has actually been sneaking up on us for the last few years. So we repeat—what will a 3-day week end mean to distribution? Well—let's put our imaginations to work, like this: Imagination at Work: 1. The two-day week end encouraged people to move farther out. The three-day week end will accelerate this trend. With three days to spend at home workers will overlook commutation problems. (Moreover, there is every reason to expect that hand-in-hand with the lure of three days each week at home will come faster transpor tation via helicopters, etc., which will make the more distant suburbs still more alluring.) Thus, retail locations will move still farther out. 2. The two-day week end encouraged people to do less downtown shopping on Saturday in the downtown areas and somewhat more Saturday shopping in the suburban areas. The three-day week end will tend to make Saturday less important both downtown and in the suburbs. Thursday, Thursday evening, Friday, and Friday eve ning may become the peak shopping periods (Sunday, too). 3. The first two days of the week—particularly during the day-



time hours—may become even more slack than they are right now. This may encourage retailers to remain closed on Monday and perhaps on Tuesday, too. (It will hardly be possible to keep retail employees on a six-day week, or even a five-day week when the fourday week becomes common for other workers. Under these circumstances, retailing will really get only the last sifting of employees.) 4. The trend toward night shopping will accelerate. It is odd but unquestionably true that the more time people have for shopping, the less time they want to spend shopping, especially daylight hours. In food, at least 50 per cent of the volume is now done at night. In many suburban shopping areas, where stores are open four, five, and six nights a week, these stores are right now doing over 50 per cent of the week's volume at night. Nocturnal shopping will be enor mously accelerated by the three-day week end. So will couple and family shopping. 5. The three-day week end will encourage still more married women to work. With three days to spend at home, taking care of the home will not be such a tough job for the working wife—espe cially with Pop to help, and wonderful new labor-saving appliances also. When married women work, their shopping needs and shop ping habits change. (Also, as more married women work, men do more shopping, either by themselves or with their wives.) 6. More leisure time increases consumption of just about every thing under the sun. The three-day week end will do wonders for retail volume. 7. The peaking of retail volume into fewer and fewer hours will continue. The three-day week end may finally compel retailers to cut down the total number of store-open hours. 8. The trend toward more children per family will increase— longer week ends help to bring this about, for more reasons than one! 9. The trend toward home ownership will pick up still more— week ends and home ownership go together. Home ownership means the purchase of an infinite variety of merchandise. 10. The trend toward the ownership of two homes will increase —and it is amazing how many people right now who live in subur ban homes also own week-end homes in more distant areas. Apart ment dwellers will, of course, increase their ownership of week-end retreats. The week-end homeowner develops a whole flock of new needs.



11. With the jet age here and supersonic planes now being planned, longer week ends will mean still more week-end travel by every type of conveyance. Travel also produces a host of mer chandise needs. 12. The nearer suburban areas will tend to become cities and will develop their own satellite groups of suburban towns; this trend is now in evidence. This, too, will change retail store locations. 13. As people in their travels cover a wider geographical area, the national retail chain becomes still more feasible. Some of our chains that right now are sectional will undoubtedly go national. Department store chains covering the country will be fairly com mon. 14. Because of increasing problems in getting labor, because re tailing will spread out still more broadly, because of the growing need to cut costs, the three-day week end will compel mass retail ing to turn to automation, to electronics. Communication and trans portation will become as much of a retail problem as it is a manu facturing problem. 15. For reasons which nobody has as yet defined, when people have more leisure time they seem to lean toward at-home shopping as well as toward store shopping. As a consequence, the gains that have been made during the last several years in mail-order, tele phone, and other forms of at-tome shopping will continue. 16. The farther people get away from downtown, the greater is the inclination to go downtown for shopping, for entertainment, etc. That inclination can, of course, be canceled out by poor or hazardous transportation and similar negatives. But now that down town is staging a positive comeback there is full reason to believe that the central business districts will promote in ways that will bring more shoppers downtown over the long week end. 17. The present shopping centers, in large numbers, will be obsoleted by the three-day week end precisely as stand-still downtown areas were stymied by the two-day week end. 18. The rate of store obsolescence, which has quickened somewhat faster than is generally comprehended by store controllers, will pick up a few more notches as a direct result of changes brought about by the three-day week end. 19. The three-day week end will make it still more difficult for re tailing to attract competent talent. At least two of those three days will be shopping days, and giving salespeople other days off will



not appeal. Consequently, retailing will be compelled to turn to still newer forms of self-service and other techniques for cutting down on floor help. 20. Everything connected with outdoor living—including sports, picnics, barbecues, etc.—will be enormously stimulated by the longer week end. 21. The week-end promotion itself, which has been a standby for many retailers for many years, will get a new lease on life. 22. The three-day week end will come in coincidentally with the development of family air transportation—the number of pri vately owned planes of new types, including the helicopter and the convertiplane, will zoom. The air age could bring about merchandise and merchandising changes as profound as those brought about by the automobile. Indeed, engineering studies recently made leave no doubt that the present commuting limit of some 30 to 35 miles will be expanded to 100 to 125 miles. These two developments, coming together—that is the mass use of air travel and the three-day week end—could shoot distribution through a real revolution.
A Mass Attack on Stock-handling Costs

There is not a single large retailer who could not cut his stockhandling costs by at least 10 per cent with a minimum investment —and by as much as 25 to 40 per cent with a maximum investment. But no matter what the investment, inventory-handling costs will not be slashed on the lowest-investment basis unless and until every executive and every department in the retail organization is enlisted in a mass attack on inventory-handling costs. This is not a problem for retail management executives alone. It is not a problem for the store superintendent or engineers alone. It is not a problem for the receiving department alone, the marking department alone, or the shipping department alone. The controller and the merchandise manager, the warehouse manager and the buyer plus a host of other functionaries on the selling floor and off the selling floor—each and every one has under his jurisdiction stock-handling motions that add to the total cost of physically moving merchandise. Supplies also play a role. Here is where an extra per cent can be added to the net profit percentage—and that could mean anywhere from 25 to almost 100 per cent more net profit. But the true potentialities of the economies



inherent in materials handling at retail won't be achieved unless and until the entire retail organization and its suppliers are lined up in a concerted drive to cut materials-handling costs. The Engineer Can't Do It Alone: It is highly encouraging to note that retailers are finally turning to automation to cut handling costs. It is highly encouraging to note that the conveyor—mechanical, electrical, electronic—is becoming as much a part of modern mass retailing as selling fixtures on the floor. It is highly encouraging to note that mechanical lifts, improved and enlarged receiving docks, peripheral reserve stock areas, pushbar conveyors, pipe slides—all these and other modern devices for cutting merchandise handling costs are finding their way into retailing. But because of the nature of the retail function, the engineer cannot perform the same miracles of handling economy that he has achieved in manufacturing or even in wholesaling. His role is vital, and retailing took too long to turn to the engineer for his materialshandling cost-cutting contributions. However, there are too many steps in retail stock handling that must for some years—in some types of stores in particular—involve individual handling to permit the engineer to apply electronics and mechanics in every step of the innumerable operations that constitute the retailing of merchandise. How to Launch a Mass Attack on Handling Costs: This is why the entire retail personnel must be alerted to the high cost of materials handling. Now, how can merchandise managers and buyers, for example, be made acquainted with the potentials for cost cutting in their specific areas by giving appropriate consideration to inventory-handling economies? Here are some specific suggestions: 1. Make it clear that retailing today involves more handling op erations than selling operations. Line up each handling operation that comes within the scope of the merchandise manager or buyer —and attach a cost factor to each one. Compare these costs with the other costs that go to make up total expense and overhead. These figures will open the eyes of the merchandise divisions. 2. Explain the limitations in any efforts to cut retail floor selling costs—that is, so far as other than strictly staple small items are con-



cerned. Point out that floor selling isn't the only "manual" operation in retailing. To the contrary, the stock-handling functions that occur within the jurisdiction of the merchandise divisions are almost entirely "manual" and can be mechanized only to a limited extent. (The greater area for materials-handling savings is in those steps involved before merchandise gets to the merchandise divisions.) The bald fact is that—other than in true robot retailing—retail floor selling costs probably cannot be reduced emphatically. But retail inventory-handling costs that occur within the merchandise divisions can very definitely be reduced emphatically. 3. Then go on to make clear that inefficient inventory handling within the merchandise divisions is costly not only in man-hours— but, perhaps at least equally important, in adding to high inventory costs. In other words, more efficient techniques for handling inven tory in the merchandise divisions could enable the merchandisers to operate with much smaller inventories. That would, of course, speed up turnover. And it would help to alleviate costly out-of-stock or understock conditions—the truly grave problems of mass retail ing. 4. The merchandisers should also be made aware that inefficient physical handling of inventory is costly also in lost sales, paper work —and, of course, in cost of square footage. Take that last item—the cost of square footage. It is not at all impossible that square-foot floor costs with relation to volume could be brought back to eco nomical levels by truly modern inventory-handling techniques within the merchandise divisions. 5. Encourage the merchandisers to send in specific suggestions for reducing handling costs within their domains. And ask for their thoughts on some of the more modern techniques, for example: A. The use of walkie-talkies or intercom systems for more efficient floor restocking B. Mechanical and electronic sorting devices that automatically sort packages, etc. C. Electronic recording devices—tape recorders D. The trend away from hand-written sales slips and away from manual sorting of tags E. The broad trend toward prepackaging in classifications where this has not been common—from furniture to bras, from lamps to china F. The broad trend toward preticketing and prepricing



Try a Handling-cost Suggestion Box System: That is merely a rough indication of how the merchandise managers, divisional managers, buyers, etc., might be brought into a mass attack on cutting stock-handling costs. Naturally, the same type of approach would be in order for other personnel. In this connection it should be pointed out that one of the highly effective techniques used in manufacturing to get ideas for cutting the cost of materials handling has been through the "Idea Suggestion Box." As a matter of fact, probably the majority of employeesubmitted ideas in most manufacturing organizations are in the category of materials-handling economies. A few retailers have developed an incentive system to encourage ideas from all employees on cutting inventory-handling costs. More will follow suit. The cost would be low (prizes ranging from $10 to $100 have been found entirely adequate). And the returns could be amazingly high. A suggestion box in the receiving areas—in the dock area, for example—would unquestionably bring to light economy ideas that might shave costs considerably. A suggestion box in the receiving room, in the marking room—ditto. A suggestion box in the shipping room—ditto. Suggestion boxes in the warehouse, in the reserve stock areas, in the forward stock areas—suggestion boxes for stock clerks and for salespeople. Leave nobody out—even the sales-promotion department has "materials-handling costs" that could be cut through intelligent thinking. This is what we mean by a mass attack on stock-handling costs. The Merchandising Approach: "Merchandise" stock-handling economies; "promote" stock-handling economies; "sell" stock-handling economies. And don't permit anybody in the entire organization to be unaware of (1) the enormous cost of handling merchandise and (2) the role each one can play in cutting those costs. In this regard it will be found that few employees—and this includes many retail executives—have the faintest notion of "materialshandling" costs at retail. In the food field, when employees are told that over one-quarter of the total gross margin is gobbled up by handling costs, they tend to be quite startled. In the department



store field, when employees are told that the store "handles" up to 20 tons of merchandise for every one ton actually moved into consumption, they are amazed. It is worth mentioning that retailing tends to pay too much attention to the economy trivia of retailing's costs (like stationery, bags, etc.) and too little to the major economy potentialities—such as inventory-handling costs. This becomes especially noticeable when one studies the retail economy ideas collected by various business publications. At least 90 per cent of these ideas make only microscopic contributions to cost cutting. And it is rare, indeed, to find a single idea involving materials handling among them. Conclusion: The day of the engineer in retailing is here. And the retail engineer is focusing on materials-handling economies. But just as manufacturers have found that a mechanical or electronic device can be no more efficient than those who use these devices—so retailers will find that the engineer cannot carry the entire load of achieving economies. That is why manufacturers have gone to great lengths to develop and promote their employee suggestion systems—and that is why a company like General Electric, which surely has engineers aplenty, has paid out several million dollars over the years for employee ideas on economies. And in retailing—for the next few years—there will be definite limitations on the application of mechanical-electronic developments to innumerable retail functions. This is the particular area where the best progress will be made by getting the most employees to contribute their thinking.
Finding More Selling Time for Hard-core Salespeople

In most retail organizations there is a hard core of salespeople who are competent. They constitute from 10 per cent to 30 per cent of the total floor selling force in the majority of stores. One of the major current objectives of some of our most progressive retail managements today is to develop a program that will enable this hard core of competent salespeople to write up still larger orders during the peak hours—those 12 to 18 hours of the week which account for up to 60 per cent and more of the total week's volume.



The only way these above-average salespeople can sell more nearly up to their talents in the hurly-burly of the peak hours is by being provided with more time. Each peak-hour minute must be stretched—to two minutes, to three minutes if possible. Doubling the peak-hour selling time of hard-core salespeople will achieve more volume, more quickly, more economically, than any conceivable training program for the remainder of the floor force. The mathematics are quite simple: Hard-core salespeople, even though they may represent only 10 per cent to 30 per cent of the total floor force, will account for from 50 to 75 per cent of the volume that can properly be attributed to creative selling. These are the salespeople who plus the sale, who make the highly profitable extra sale, the highly profitable big-ticket sale, the highly profitable big-margin item sale. These are the salespeople who really squeeze both volume and profit out of the golden stream of traffic that jams store aisles during peak hours. Now, how can their time be stretched? How can they be so set up as to enable them to serve still more customers, still more intelligently and effectively, during the enormously important peak hours? Mass-production Techniques Applied to Retail Selling: Some top retail executives have concluded that the solution lies in what is really the application of mass-production, assembly-line techniques to floor selling. And they are moving in these directions: 1. The hard-core salespeople are being given extra incentives, in centives based on performance achievements. 2. The hard-core salespeople are being given assistants of several types. In the main, these assistants "take over" after the sale has been made. They write up the order; they arrange for wrapping, change-making, etc. This is an important development—to date it has shown considerable success where it has been tested. It stems from the knowledge that, during peak hours, up to 65 per cent of the time of these hard-core salespeople is spent on nonselling func tions. The objective is to arrange matters so that, at least during the peak periods, they can concentrate up to 90 per cent of their time on selling. 3. The hard-core salespeople are being assigned, especially during peak hours, to those sections where they can best put their talents to work in moving the more profitable merchandise. It is amazing



how frequently the most competent floor personnel works in sections that represent the smallest net profit percentage. 4. The hard-core salespeople are being scheduled on a particu larly mobile basis. The assumption here—and it is generally correct— is that an above-average salesperson can sell almost any category effectively. Therefore, within reason of course, they are moved from one section to another as promotions dictate—and, also, as rushhour emergencies dictate. At least one store is experimenting with a sort of shock-troop technique—that is, a reserve force of hard-core salespeople is kept available to be rushed into emergency areas as these develop during the peak hours. This is an interesting concept in view of the known fact that retail volume is often amazingly un predictable. Every retailer knows that surprise is the very essence of retailing. 5. The hard-core salespeople are being exposed to training pro cedures offered by suppliers. It is being reasoned in this connection that too few of the total selling force tend to be benefited by these training programs and that much more can be achieved by having the manufacturer's representative concentrate on those best able to absorb and apply the training techniques. 6. The hard-core salespeople are being encouraged to submit their own ideas for improving their performance. One store reports that this has proved to be a splendid source of ideas for getting more volume from these talented salespeople. These men and women are above average in intelligence. They have energy, drive. They are eager for better earnings. And they tend to have pretty keen notions concerning (a) the factors that are braking their best efforts and (b) what can be done to enable them to function more efficiently. 7. The hard-core salespeople are being urged to concentrate on helping at least one other salesperson—usually picked by the person nel director in collaboration with the competent salesperson—for training. Under proper conditions, which would include arrange ments that promise the competent salesperson some suitable incen tive for training an associate, this could lead to increasing the size of the hard-core competent salespeople. That, in turn, increases the time factor of all of the competent salespeople. 8. The hard-core salespeople are being given a degree of in creased authority on the floor over other salespeople. This is a some-



what new concept. It presents many difficulties. However, it also offers some very interesting potentialities. 9. Obviously, better fixturing will enable competent salespeople to save time, sell still more effectively. The relationship between fix turing, stockkeeping, stockchasing, etc., and the effective utilization of the abilities of the top-flight salespeople is pretty obvious. 10. One retail executive sums up his policy with respect to hard core salespeople this way: "We aim to automate all of their nonselling work so as to give maximum impact to their selling ability." That is an apt summation. Fewer—but Better—Salespeople: If this fundamental concept of concentration on hard-core salespeople develops as it should, it may wind up with a store having fewer people who qualify as salespeople. The remainder of the floor force will then, perhaps for the first time in modern retailing, be properly classified by the more limited functions these other floor people perform. Under such a system, it would be possible for retailing to pay more for competent salespeople, to offer them more attractive incentives, thus attracting still better talent and thus holding on better to competent talent. Both of these represent vital problems in modern retailing. Analyze the Floor Function: The bald fact is that too few retailers have ever made a deep analysis of the floor function. The tendency has been to consider (1) that everybody on the floor is a salesperson and (2) that the major part of the time of the floor personnel is spent in selling. The unfortunate truth is that only the hard-core salespeople do any real degree of competent selling. This was once again demonstrated in a study made by the managing director of the American Gas Association. It appears that the gas industry had developed a thermostatic top burner that has unique advantages. This executive visited 30 appliance stores in 11 cities before he could find a single salesman who had even the vaguest idea as to what a thermostatic top burner was, what it did, how it benefited the customer. What is more, some of the explanations given by the salespeople were totally wrong!



In soft goods as well as in hard goods, in drugs and in innumerable other classifications, every check ever made over the years has demonstrated time and again that only a small group of floor people really sell. And this is not merely the result of lack of talent; it is also the result of floor people being compelled to devote as much as half of their total time to nonselling functions. A Twin Drive: Retailing has tended to concentrate on the development of selfservice and self-selection techniques. This was, of course, entirely proper. Indeed, self-service and self-selection still have a long, long way to go in many stores, in many merchandise classifications. But now at least certain types of mass retailers must recognize that even now under self-service and self-selection procedures there is not only opportunity for, but a positive need for, truly creative selling by those members of the floor staff who are competent, the hard core of salespeople. Therefore, a twin drive is just about currently getting under way. It involves still further improvement and broadening of application of self-service and self-selection techniques. It also involves a more rational, a more comprehensive approach to the opportunities inherent in hard-core salespeople.
More Autonomy for Managers of One-stop Stores

Giant stores need giant merchants—not giant automatons. Giant stores demand more executive power closer to the wheels. And since the basic move in all types of mass retail organizations is toward giant store units, the organizational charts of most chains and department stores either are undergoing or will undergo drastic redrafting. This is vastly important to manufacturers. Either through deliberate policy change, or through desperate improvising necessitated by bitter competition, the manager of the huge new store units of chains—and the manager of big department store branch units—is becoming, or will soon become, a true retail executive, with local management authority. Moreover, he will be given a staff of executive associates that bears a close resemblance to the executive staff of a capably run independent store of similar size and turnover.



18 "Reasons Why" for Store Manager Autonomy: Let us check the fundamental reasons that compel lifting the executive staff of giant store units of chains and department stores to a true executive level. Without attempting to list these factors in any particular order, here are the circumstances responsible for this present and pending dramatic change in chain-store and branch-department-store procedure: 1. Huge store units cannot be efficiently operated by remote control. The manager of a giant store unit is the captain of a siz able retail enterprise, with an annual turnover running from perhaps $2 to $20 million and more. Stores with this kind of turnover necessi tate high-level executive ability—and authority—right on the spot. 2. Organizational red tape—with which most chains and depart ment stores are fearfully burdened—will cause giant store units to flounder. Only a competent executive can cut red tape—and only a competent executive, having cut himself off from red tape, can function efficiently largely on his own. 3. The net profit record of many, and maybe of most, of the giant store units opened by chains and department stores has been unsatis factory. It is now taken for granted that it will require two to three years for a new giant unit to be put on a profit-making basis. Most giant store units opened in 1959 and 1960 by chains and department stores even failed to achieve planned figures in the first year or two of operationl This rather dismal profit and volume performance of the giant store units leaves little choice other than to give the store manager both larger executive powers and a more effective execu tive staff. 4. The competition between giant store units of chains and de partment stores is becoming intensified. Day-by-day competitive maneuvers are a vital necessity. Time is of the essence, and distance to headquarters is the great creator of time drag. 5. To date, the one-stop outlet of most chains, and only to a lesser extent of department store branches, has been more one-stop in in ventory than in customer buying habits. Only a tiny percentage of the daily traffic ever covers more than a minor percentage of the total aisles. With more and more one-stop store units, the problem of getting shoppers to shop more of the aisles, more frequently, is



becoming acute. This calls for competent local personnel plus local autonomy. 6. Per-square-foot volume in many, and against maybe most, of the newer giant one-stop units is poor. This situation (of which an inadequate average ticket is a part) must be improved if the giant store unit is ever to contribute a giant new profit. Headquarters control could do well with per-square-foot figures in small store units, but that performance cannot be duplicated by headquarters control of huge stores. 7. The number of families per giant one-stop outlet is clearly on a rapid decline. This statistical change will become still more acute as more chains and more department stores open still more huge stores. An adequate traffic count, under these circumstances, is prob ably impossible to achieve unless a giant store is operated by local executive talent. 8. Giant store units tend to show a shocking increase in nonselling areas. And selling areas show a discouraging waste of space. A com petent executive operating on the spot can shrivel nonselling areas and shrink wasted selling areas. 9. In huge store units the problem of out-of-stock, of understock, of unbalanced inventory is obviously much more serious than in a small store. The larger the inventory in a store, the more difficult it is to achieve effective inventory control from distant headquarters. 10. Headquarters control inevitably leads to stores with all of the floor excitement of a law library. Big store units simply must live and breathe merchandising-promotion excitement. There is a dis tinct trend among the newer types of discount retailers to put fun, as well as promotional excitement, back into shopping—and they can do this because their managers have authority. Headquarters control tends to lead to the lackadaisical. 11. Most of the new giant store units boast of larger fashion de partments. Fashion not only continues to have local overtones and undertones, but fashion moves too rapidly to permit a cumbersome headquarters organization to keep step. Moreover, the traditional chains seldom have a really competent headquarters staff for fashion lines. Big fashion departments in big stores demand big executive talent on the spot. 12. Competitive changes at the local level can be not only sud den—but of sizable proportions. Example: The manager of a giant



variety chain unit suddenly discovers that a discount chain will shortly be opening a 150,000-square-foot unit nearby, and that an adjacent department store branch is about to double its selling floor area. He can't wait until headquarters tells him how to react to this new competition. 13. Most of the newer giant store units are similar in location, in architecture, in inventory, and even in services. The Ike and Mike similarities of most giant store units cannot be changed by Ike and Mike store managers! 14. The discount chains tend to give vastly more management leeway to their store managers than do most of the traditional chains, and department stores. That's why they are dynamic. Dynamism is lost through distance. 15. For years it has been said of the main store of department stores that 70 per cent of total volume comes from 30 per cent of the inventory. Obviously, the figures could never and will never achieve a 50-50 balance. But in too many giant stores of the chains (and in too many big new branch units of department stores) the inventory-to-sales picture, in this particular respect, is even more dismal than the traditional state of affairs. That situation can be im proved only by competent executive talent right in the store. 16. Giant store units demand merchants, at the store level—highly competent merchants who can merchandise with all of the flair, all of the talent, all of the "imagineering'' that was true of the found ing fathers of mass retailing—John Wanamaker, Richard Sears, F. W. Woolworth. Small-store talent, willing to function as puppets to headquarters, cannot successfully operate giant stores. These stores need imagineering executives. 17. It is a bit difficult to believe, but it happens to be quite true, that in some chains, for some years, store housekeeping was con sidered the vital function of the store manager! Giant stores must have managers willing and able to throw away the book and create one of their own! 18. Mass retailing had lost most of its flexibility. That was not a critical weakness—until two things happened: (a) the discount chains opened huge stores with managers able to, and willing to, move rapidly, (b) the giant store units of all mass retailers began to compete with each other, rather than with small independents. Now mass retailing, particularly in its giant store units, is seeking to



recapture flexibility at the local level. It is clear that this can be achieved only by giving the local store manager autonomy, and giving him the staff needed to function as a store that is primarily autonomous. Recapitulation: It has been said that department stores, when they began to open branch units, attempted to run what had obviously become chainstore organizations with department-store organizational procedures that had never been intended to apply to more than the downtown store. Similarly, when the various chains began to extend credit, they tended to bog down in traditional central office red tape—shoppers could get a loan more quickly at a bank than a credit O.K. at some chain stores a year or two ago. Similarly, chain stores have effected total changes in their store units—in size of the store, in diversification of inventory, in size of store staff, etc. What is more, most chains are doing a rapidly mounting percentage of their total volume in a rapidly declining percentage of their total number of store units. Yet, until very recently, many chains tended to control store units of 50,000 and 100,000 square feet precisely as they controlled store units of from 7,200 to 12,000 square feet. Also, until recently, department stores tended to look upon their branches as little children who had to be closely tied to Mom's apron strings—and when department stores began to open branches as large as 300,000 square feet, the inclination was to control these branches from downtown precisely as had been the case with the early branches of 50,000 square feet. Now mass retailers are becoming cognizant of the fact that giant store units cannot be run by Pygmies. Giant store units necessitate store executives of stature—of giant stature, in some instances. That type of executive personnel cannot be attracted to—or long held by —an organization setup that makes them robots. They will not function as automatons—and they will, and do, demand autonomy. Giant store units opened in 1960 and 1961 by many, if not most mass retailers, turned in a poor net-profit showing, and an even poorer return on investment. The record for 1962 on new giant store units will not show any dynamic improvement. More and more huge new stores now require two and three years to turn the net-



profit comer—and, by that time, the local bloom may be off the local peach! All this unmistakably pinpoints the urgent need for a high-level executive as store manager—who will be given almost complete autonomy—whose compensation will include a share in net profit earned by the store—who will be given a competent staff of executive associates—and who will function as a merchant, not as an automaton.
A War on Paper

In industry, there are now several large service organizations that concentrate exclusively on the elimination or shrinkage of unnecessary paper work among manufacturers. In almost every instance, their savings have been quite remarkable. In mass retailing, little progress has been made in this direction. With only a couple of exceptions, mass retailers have yet to embark on a dedicated war on paper. To the contrary, in ratio to its size, mass retailing is today buried much deeper under a buzzard of paper control than industry. Over in England, where large retailers presumably have much to learn from their American counterparts, a giant retailer (by English standards) recently embarked on a program to cut deeply into paper work. It has achieved enormous economies—and more are on the way. Example—it eliminated its time clocks. In one stroke, that eliminated 22 million pieces of paper a year from its administrative operations. Example—a bulletin of administrative information, formerly published weekly, now is issued once or twice a month, as circumstances warrant. Example—it was discovered that a million so-called "catalog cards" were being filled out each year. Nobody knew for what purpose they were currently used. They were discontinued and the accumulation thrown out. Nobody as yet appears to have missed them. Example—more than 10 million "goods received" slips were eliminated when it was decided to allow salesgirls to go into stockrooms themselves to get needed items.



Example—half a million very costly complaint reports were eliminated by a new policy of exchanging without question any item returned by a customer. (Returns have not increased.) Example—illness and tardiness reports have been eliminated. Example—an "antipaper" committee has been set up. It keeps a hostile scrutiny on every request sent by any department to the company's printing plant—particularly requests for forms. The New Philosophy in the War on Paper: A new philosophy is emerging in the slowly mounting retail war on paper. This new philosophy takes the following concepts into consideration: 1. It is too expensive to try to make employees honest through paper controls. 2. It is too expensive to try to make customers honest through paper controls. 3. Losses through dishonesty, chicanery, and similar character faults of employees and customers are an integral part of the cost of doing business. Cut the overhead by curtailing paper controls, pass these savings on to the shopper in lower prices, and the resulting increase in volume should more than balance out any increase in losses. In brief, the new philosophy is based on the calculated risk. And it takes the position that so long as the risk is ably calculated, then the costs involved in losses due to less paper control will be more than balanced out either by greater volume or by the savings inherent in the reduced program of paper control. A Paper Lesson from Self-service: This is much the same philosophy that mass retailing has come to accept with respect to self-service and the open display of merchandise. It will be remembered how the drug chains, the variety chains, the department stores (even the food supers on nonfoods) objected to self-service, self-selection and the open display of merchandise "because we will be stolen blind." Today, all mass retailers display practically all categories for selfservice and self-selection. The shrinkage rate from shopper pilferage —so far as this can be traced—has scarcely gone up. But volume has indeed moved up.



In much the same way, this large English retail chain reports: 1. No increase in stockroom losses as a result of permitting sales girls to go into the stockroom. 2. No increase in tardiness since the time clocks were thrown out 3. Everybody seems much happier under the less-paper system. It's not only nicer to trust people, but more economical. Larger Retail Organizations—More Paper: The fundamental trend in mass retailing is toward giant retail organizations. And not only are retail organizations assuming giant size in dollar volume, but the number of store units under one parental roof is growing and the stores are spreading out over much greater geographical areas. This seems to call for more—and still more—paper control. And that is precisely what is happening in mass retailing. The total volume of paper used in the control of mass retailing is not merely at an all-time peak at this very moment—but it is growing at a much faster rate than total dollar volume. One Extreme or the Other? It would not make sense to advocate that mass retailers eliminate paper controls at one fell swoop. That is hardly apt to happen anyhow. But it does make sense to adopt a rational approach to paper controls. When paper economically controls the retail operation, it makes sense. But when the retail operation is burdened by paper control—and this is by no means unusual—then paper becomes the master (and an expensive master to maintain) rather than the servant. Moreover, the paper controls referred to are not merely time clocks and other employee checks. They include those paper controls that sometimes hamstring and hog-tie the store manager, buyers, etc. For example, it is not unusual in some large retail stores to find that seasonal stocks come into the store units too late, that reorders cannot be put through in time, etc. This can be due to policy, but, more often, it is because somebody, somewhere along the organizational line, has become buried in a blizzard of paper.



Channels of Communication: In addition to excessive paper control, there is also a tendency in large retail organizations for an excessive amount of information to be distributed—on paper—through established channels of communication. We refer now to such bulletins as the bulletin of administrative information whose frequency of publication was cut by that chain in England from weekly to once or twice a month. In many retail organizations there are too many bulletins issued or written by too many people. And most of them are too wordy! Store managers in particular have more reading to do than a book critic! Since most store managers have not learned the art of fast reading, and since they tend to be overburdened with too many details at best—this reading burden is another case of being buried under a paper blizzard. Publishers have good reason to know that, by and large, businessmen are not exceedingly facile readers, quite the contrary! But in retail organizations, there is singular evidence that this principle is either not comprehended or is largely ignored. Keep open those channels of communication—and one way to do it is by preventing them from becoming clogged by a flood of paper debris! Check Those Files: It would pay almost any retail organization to check its files of filled-in paper forms for usage. So many file clerks could testify that those which they file from that moment forward rest undisturbed in the files for ever and a day. As a matter of fact, one retail executive reports that every so often he arranges to have a research group dig up some data he requires— and later discovers that the facts have been reposing in files for months or years. Files tend to be burial places! Cemeteries of information! One giant retailer reports that when it was decided recently to put some of its filed material on microfilm for safekeeping in a cave, it was discovered that the files were bulging with material that nobody other than the file clerk knew was being filed. So a good place to start in a war on paper is right there in the



files. The librarian or the manager of the files may be disturbed; so may whatever insects feed on filed paper. But the final outcome could be a sizable victory in the war on paper. Conclusion: The new low-margin rivals of established mass retailers achieve an amazing annual sales volume—with an astonishing minimum of paper control. Maybe they carry lack of paper control to an extreme, but they prove that a retail business with a volume as high as $50 million and in two cases exceeding $100 million annually can be carried on with what some established retailers would call a shockingly small amount of paper work. Long-established giant retailers accumulate paper as inevitably as they accumulate years. The basic objective must be to slow down the rate of paper accumulation. Electronic data processing will help. An Antipaper Committee sounds like a good idea—so long as it does not issue a regular report, on paper!
The Comeback of the Leased Department

In 1962, the total volume done by leased departments in all types of mass retail outlets will dwarf all previous figures. By 1965, the total volume done by leased department operations will show a 50 per cent increase over the 1960 total! Moreover, the number of merchandise classifications involved will broaden tremendously. This will be true of traditional department stores, traditional chain stores, and the older discount chains. It will be even more true of new retail types—the so-called discount "mill stores," the new selfservice discount department stores, etc. The leased department has staged a remarkable comeback. It is necessary, therefore, for all merchandisers to reappraise the leased department concept. The Forces Pushing Leased Departments Ahead: Why is the leased department spreading so rapidly? Basically, because the diversification of inventory by classification by all retailers has brought them into categories that they ultimately find they cannot merchandise profitably. In other words, the stronger the trend to one-stop store units, the stronger the trend to



leased departments. And the one-stop store unit is the great trend in major retailing. At one time the leased department was almost an exclusive with department stores. Today it is becoming common among variety chains and drug chains, among hard-goods chains and discount chains, among soft-goods chains, furniture chains, etc. And, of course, the rack jobber (a leased department operator) does a gigantic volume on nonfoods in the food super, in the drug chain, and elsewhere. Some Facts on Leased Departments: According to a survey made by the Controllers' Congress of the National Retail Merchants Association, the 10 most commonly leased departments, by percentage to the total, in 203 reporting department stores and 21 specialty stores are: Beauty salon, 55.2 per cent; better and lower-priced millinery, 46.3 per cent; photography studio, 44.3 per cent; shoe repair, 39.9 per cent; jewelry and watch repair, 36.9 per cent; sewing machines, 34.0 per cent; women's and children's shoes (main), 31.5 per cent; millinery (basement), 23.1 per cent; lending library, 22.2 per cent; and women's and children's shoes (basement), 18.2 per cent. Rack merchandisers supply about two-thirds of the food stores' nonfoods, according to a survey. Since nonfoods in the food supers will soon total over $2 billion annually, the leased department operator is a giant factor in this area alone. The discount chains in most instances are deeply involved with leased departments. In some instances up to 75 per cent of the total selling floor area is leased and the discount chain may derive the major part of its net profit from leased rentals! The leased department concept is growing here at a fantastic rate. Why the variety chains are going into leased departments is well indicated by a single example: A J.J. Newberry Co. store gave up the ghost on its ready-made slip-cover department and turned the operation over to a concessionaire. Sales had been so poor, and the percentage of returns so great, that, according to a spokesman, "We wouldn't have kept slip covers unless a concessionaire handled it." One of the major problems encountered was lack of inventory control. Many broken sets and incomplete pattern lines mitigated against large unit sales, or any sale. Another problem was a high



ratio of refunds to sales, because covers did not fit, etc When the concessionaire took over in this Newberry store, he found "nothing but odds and ends in a $14,000 retail stock—nothing matched." Phonograph records are complicated merchandise. There are 1,400 different labels on the market. Hit singles stay in demand only four to eight weeks, according to a West Coast rack merchandiser. Only a few tunes and artists have steady, long-range appeal. The rack jobber merchandises records more efficiently than most retailers. The head of a retail book outfit played host to a group of publishers, poured drinks for them, and served an elegant luncheon. He had arranged this luncheon because he had news for them, good news. He proposed to sell 15 to 20 per cent more of their books during the current year. The host operates leased book departments in 62 department stores. Retailers as Leased Department Operators: While E. J. Korvette, Inc., promotional department stores, does a bang-up job in merchandising such home-goods items as major appliances, housewares, radios, and television, it does not operate its furniture and floor-covering divisions. Food chains are running food departments in discount chains. Drug chains are running drug departments in food chains. Shoe chains are running shoe departments in discount chains. This promises to become a major trend within the broader trend toward the leased department. Some Specific Predictions: With regard to the future of the leased department, it may be accepted as basic: 1. That more large retailers will soon turn to the leased depart ment concept in more departments—especially those departments showing poor net-profit ratios. 2. That large retailers will analyze their present leased department operations to determine how they may be made more profitable to all concerned—including, of course, the shopper. 3. That new areas of service by leased department operators will be explored jointly by large retailers and these outside operators. These operators are becoming bigger, stronger, better organized, more ethical. The whole leased department concept will achieve



a new integrity as well as efficiency. The business men in this field have their own associations. They are developing codes of practice. If some of them have been in the shadow, they are coming out of the shadow. 4. That more willingness to experiment with, to test new forms of, leased departments will be shown by big-store management. 5. That the leased department operator will develop his own con trolled brands. This is already a fact in several merchandise cate gories. He will also become involved in manufacturing. 6. That national chains of leased departments will come into being. 7. That the mix-match marriages of various chains through leased department arrangements will multiply. This will become one of the great trends of the next few years. It means that very often the leased department operator will himself be a retailer! 8. That big independent stores with a prestige background will in creasingly go into franchise operations which are, actually, leased departments. This, too, will develop into a sizable trend. Leased Departments and Store Control: There is an assumption that the leased department tends to water down the control over its own store by the store owners or store management. This is not entirely theory. Unquestionably, this has happened in the past. However, where it has occurred, this loss of control has come about because of the short-sightedness or lethargy of the store management rather than because it is an inevitable part of the leased department concept. The leased department compels control measures by store management. Where these control measures do not exist, or where they are not carefully thought out, or where they are not effectively policed— then havoc can develop. But the leased department is, really, nothing more than an extension of the paid demonstrator concept. Store management has certainly found out how to control the paid demonstrator—and also how to make certain that the demonstrator functions so that the shopper cannot really tell the difference between a regular store salesperson and the paid demonstrator.



Precisely the same can be, should be, and indeed must be done with the leased department. Today there is no excuse, in a leased department operation, for failure to have clauses in the contract that give store management the proper degree of control. Unfortunately, too often store management has been concerned with percentages—to the exclusion of the control factor. Control must be spelled out in the lease contract. And then store management must set up, within its own organization, procedures and personnel adequate to cope with the policing problem. Another point—it is entirely possible to retain and even to enhance a store image despite the number of leased departments. The discount chains have certainly proved this. Some discount chains, as already mentioned, are primarily leased department operations—yet, so far as the majority of shoppers are concerned, the stores of these chains are completely operated by the chains themselves. Similarly, with respect to other problems inherent in the leased department concept, these problems unquestionably exist. But problems can usually be solved, and since the leased department can offer more advantages than disadvantages, it is really up to store management to learn how to live with the leased department concept, not to turn it down simply because it presents some headaches. Conclusion: Keep a close eye on the leased department—and an open eye and mind, too. It promises to become one of the major retail merchandising developments of the near-term future. Retailers will become both lessors and lessees—a fascinating development.
New Management Thinking about the Store Window

At one time, the store window was evaluated as one of the most valuable areas within the total store perimeter. But as shoppers tended to do less window shopping, especially in shopping-center and highway locations, store management tended to conclude—and correctly—that the window had lost some of its traditional values. In some extreme instances this led to stores with no windows. In other instances, it led to reductions in total window area, and occasionally to cuts in the window display budget.



But now a totally new concept is just beginning to take hold with respect to the window. The thinking behind that new concept may be summarized in this way: 1. Fewer shoppers stop in front of our windows. 2. These fewer shoppers spend less time in front of our windows. 3. There is too much of a time gap in this era of split-second shopping, between exterior window shopping and in-store pur chases. What the mind registers in front of the window it tends to forget by the time the store interior is shopped. 4. Traffic inside the store is more important than traffic outside the store. 5. Ipso facto—why not plan the window area primarily to appeal to shoppers inside the store. Not Theory: This is not merely theory. It is being considered for use in several department stores of the newest type in some of the great regional shopping centers. And it is actually being adapted for use by some food supers, which is rather interesting since the food supers had permitted their windows to fall almost into decay. The point should be made promptly that applying this reverseEnglish thinking to the window does not carry with it the implication that the appeal to the shopper outside the store is to be totally disregarded. In some instances, this may be the case. But more often there will be a distinct promotional concept involved that plans the window area so that outside traffic will continue to find some draw in the window—but the main lure will be aimed at traffic inside the store. Management Must Issue Directives: It should be pointed out that this new concept tends to be applied only when store management issues appropriate directives. As might be expected, those in the display department who have been brought up in the traditions of the window display craft, are not likely to revolutionize their thinking of their own accord. There is no question that many stores continue to invest funds in windows in a way that no longer provides a sound return on the investment. This happens not because the window art has dwindled in these stores, but rather because the fundamental thinking about the window has fallen behind the shopping times. It has been diffi-



cult for window specialists to accept the premise that shoppers in fewer and fewer numbers find traditional windows an important part of the shopping expedition. Only when management arrives at this conclusion and lays down the required guide lines for the display department, will the investment in window maintenance be used in modern ways for appeal to the modern shopper. It Started with the Open-front Window: When the open-front window began to assume popularity, the assumption was that it would make a window display of the entire store interior. But this concept still rested on the outmoded concept of outside traffic spending time looking in. Now it is just beginning to be understood that the windows are really exposed to more traffic more of the time (and this is actual buying traffic) from the interior—rather than from the exterior! So, in effect, the window may indeed be staging something of a comeback—but its new role is not so much to tempt traffic to come into the store as it is to make an additional sale to the traffic that is buying right there in the store. This is quite a turnabout—and it suggests that many retailers, in their window display programs, might do well to begin thinking of their windows from the standpoint of its appeal to in-store traffic, rather than for its appeal to outside traffic. Increasing the Average Ticket: The grave, basic, fundamental problem of all giant retailers today is to increase their average ticket, to sell more to every customer in the store, to win more one-stop shoppers for one-stop store inventories. The window can contribute to this goal—by turning it inside out, as it were. Certainly, in most great one-stop store units of the food outlet, the drug outlet, and the variety chain outlet (and in the great discount chain outlets, too) the window can never hope to roll up the sales volume through appeal to outside traffic that it can achieve by an appeal to buying traffic inside the store. Much the same is true of some department and specialty stores. Highway Location Windows Are Usually Reverse English: As a matter of fact, windows in stores located out on the highways have tended, almost through happenstance, to be planned



more for interior traffic than for exterior traffic. In these highway locations, the car that stops in the parking lot means a shopper is on the way inside the store. There is little need to appeal to that shopper while she walks from the parking area into the store—all of this has been done, really, before she ever left home. As a consequence, while the early highway stores automatically planned their windows in the historic way—with the outside traffic in mind—it was soon realized that a new concept in store location called for a new concept in store window programs. The result has been that, in the highway location, the store window still presents an attractive front to the exterior traffic;—but the fixtures, the displays, are all aimed right on target, which in this case is the traffic inside die store. And Shopping Center Windows Also Tend toward Reverse English: In shopping centers, the early store tenants tended toward the open-front window. But here it was discovered not only that even mall traffic did little window shopping—but that a substantial store traffic came into the store through rear entrances, directly from the parking area. Experience soon proved that window shopping from the store exterior in most shopping centers is at a very low minimum. So it was soon concluded that the open-front window concept, with its theory of opening up the entire store to examination from outside the store, had little basis in practical fact. It was also reasoned that shopping center traffic tends to attract, in the main, the same shoppers—and to these repeating shoppers, the store interiors soon become so familiar that there was little lure in them for the shopper outside the store. Shoppers tended to know these store interiors almost as well as they knew their own living room. Therefore, in shopping centers, too, the trend has been toward planning the window so that it does a better job of selling more to traffic inside the store. Downtown Stores Lag—but Isolated Examples Appear: Downtown stores tend to continue to follow historic window display patterns. But here and there examples are to be seen of downtown store windows that are obviously planned with very much of an eye on traffic inside the store. It would unquestionably be worthwhile, in many downtown areas,



for the merchants to subsidize jointly a study of window shopping by downtown shoppers. This study should be planned to determine what percentage of shoppers entering each store really pause to examine the windows—how long they pause in front of each window—and what a really objective analysis of turnover figures pinpoints as the precise relationship between window display and additional volume, after allowing for all other factors that stimulate volume including, of course, newspaper advertising. Such a study would very certainly lead many (not necessarily all) downtown stores to conclude that here, too, the windows should be angled to sell the traffic inside the store first and foremost The No-window Trend: A few years ago, a small trend developed in store architecture which involved either a minimum of window space or no windows at all. In some instances, these windowless, or minimum window area, stores have apparently done well enough. However, we take the view that the store window has been ingrained part of shopping tradition for generations, and that for their appeal to shopper instinct and habit, windows usually are indicated (even though total window area may be reduced). But this shopper instinct or habit can be catered to just as well with windows that beckon to the shopper inside the store, without totally neglecting the traffic approaching the store. Conclusion: It used to be said in retailing that the window area was the most valuable selling area in the entire store. With the decline in window shopping, this became less and less true. Yet many stores have continued to increase their window budgets—costs for windows have tended to jump. Now it is being found that windows can be so planned that they perform adequately for exterior traffic—and do a bang-up job for interior traffic;—on a lower budget! The funds thus saved, put into newspaper advertising, provide a combination of window selling and print selling that stimulates volume on an economical cost basis.
The Coming Era of In-home Retailing

Will retailing done off the retail floor grow faster than retailing on the store floor?



Before examining this startling concept, let's agree that: (1) there will always be a retail store, (2) moreover, retail volume done away from the retail store will not in our time challenge the volume done on the floor of retail outlets. But let's face it—the percentage of total retail sold away from the retail floor has been mounting for the last decade! And the trend is dynamic. Example—mail-order retailing has been on the rise for ten years. Example—telephone retailing has shown sufficient growth potentials to encourage ATT to go all out in encouraging more retailers to cultivate telephone volume. Example—in-home selling has moved ahead on an enormous scale. The variety of merchandise, as well as total volume, sold by a vast army of in-home salesmen has broadened in a remarkable way. But shopping from home—as differentiated from shopping in the retail store—is destined for even greater growth during the 1960s than was recorded during the 1950s. This will take place for two sets of reasons, one set involving some traditional factors and the second set involving some new factors. The Traditional Factors: The first group would include the following reasons: 1. Most shopping long ago lost its lure as fun, as entertainment, and as diversion. With the exception of some shopping, most shop ping today is a chore, a bore. This encourages shopping from the home—where, incidentally, shopping can sometimes really be more fun, more entertaining. 2. Shoppers are being subjected to more inconveniences (as at the check-out in the modern food super), more hazards (as in park ing and in traffic), more physical problems (as in toting merchandise to the car, up into the home, etc.). Shopping from the home can, at times, be much more convenient, involve less hazards and less physical problems. 3. The time factor is also involved. In-store shopping involves con siderable time, particularly when every step of the shopping expedi tion is clocked. Shoppers want to shop fast, in split seconds. The very fact that so many millions of shoppers have time to shop only



at night spotlights the time problem. Shopping at home can save time. 4. In-store shopping involves many costs to the shopper. These include car costs, baby-sitter costs, wear and tear on garments (as well as on patience!). In-home shopping can be a real economy. The Newer Factors: The second group of factors includes the more exciting developments. These would take in: 1. The vast increase in the number of giant-sized stores, each of which is, in effect, a department store. Clearly, the number of po tential shoppers per store of this type has declined. These giant stores now compete more with each other. Expressed another way, the number of department-store-type outlets has increased much more rapidly than has our population. The number of store units with floor space running from a minimum of 100,000 square feet up to 300,000 square feet (and higher) has increased much more rapidly than has our population. Moreover, this trend is right now accelerating; the number of potential shoppers per store of 100,000 square feet and higher will continue to decline. This will come about despite the obvious fact that these big store units will draw traffic away from smaller stores—in other words, this draw of the big store unit will not be powerful enough to balance out the great increase in the total number of giant one-stop outlets. Consequently, the one-stop outlet must reach out to the shoppers who won't come to the store—or who won't come often enough—or whose average ticket is not large enough. 2. The grave problem that is so evident in most of the new giant outlets still stems from the fact that the shopper covers too little of the total store area, makes too few purchases. The average ticket in too many giant outlets simply has not kept pace with the larger inventory. While this problem must be solved within the store itself, it can at least be alleviated by a sort of backdoor approach which, in this instance, means reaching out to the shopper when she is not on the store floor. 3. There is a growing recognition of the fact that our people really are ready to shop at almost any time of the day, any time of the night, and even on Sunday. If it is not profitable to keep the store open during these hours or days—or during all of these hours and all of



these days—then, modern retail management asks itself, why not find other techniques for catering to these customers during some of these hours and during some of these days? The promotion of telephone order service on Sunday was one of the early answers to this situation. Soon we will see more evidence of 24-hour telephone order service—after all, we are becoming a nation of night owls, and it is logical that a people who will stay up to watch the late-late show may also shop during late-late hours, provided it is made convenient for them to do so. Obviously, mail-order shopping can be done any hour of the day or night—Sundays as well as week days. 4. The number of hours available for couple shopping is limited. This is particularly true of working couples, of homes where baby sitters are too costly or unavailable, etc. These are the very homes in which accumulation of possessions is at a peak. And these are the very homes where so much of the buying is done as a decision by the couple, rather than by the woman or the man. To make these limited number of shopping hours by couples less limited, it is ob vious that in-home, mail-order, and telephone selling offer decided advantages. (And let's bear in mind that couples buy big-ticket mer chandise. ) 5. As we have more senior citizens, many of whom may find instore shopping, especially in giant stores, a physical problem, we clearly have more "prospects" for in-home, mail-order, and telephone retailing. Surely the figures of coming growth in numbers of elderly people need not be repeated here. 6. The standardization of merchandise, the preselling of brands— all the developments that led to self-service and self-selection—also encourage telephone and mail-order shopping from the home. As a matter of fact, come to think of it—telephone and mail-order shopping are simply forms of self-service and self-selection! Right? 7. The eventual use of the home TV set as a shopping facility has been predicted for some years. We may be slightly closer to it today than we were a decade ago. Ultimately, it will play at least as much of a role as shopping via the telephone—indeed, it will be tied into telephone ordering from the home. (Since ATT has shown such a keen interest in exploiting the potentials of telephone shop ping, it is probable that the vast facilities of this great communica tions system will be employed to accelerate the advent of the even tual era of shopping via the telephone and home TV screen.)



8. The vast extension of the credit and the credit card system facilitates in-home shopping. 9. The use by large retailers of electronic data processing and handling equipment will also make the various forms of in-home selling more economical to handle and therefore more feasible. The data processing equipment can record orders from the home (mail, telephone, etc.) and can also be hooked into the electronic handling equipment that sorts out and assembles the order. And, of course, this equipment can work round the clock—a considerable advantage in view of the great trend toward nocturnal shopping and Sunday shopping. A Look Back—and a Look Ahead: Centuries ago, a substantial percentage of retailing was done right in the home. The Yankee Tin Peddler typified this era. Then for decades the trend was toward doing less shopping from the home— a trend that was only temporarily decelerated by the appearance early in the century of the great mail-order houses. But now, for at least a full decade, there has been mounting evidence of a strong groundswell involving a return to shopping from the home. Modern social conditions (the working wife, etc.) modern technology (the whole spectrum of electronic communications), and modern marketing (the presold brand plus universal credit) all combine to make in-home shopping (by mail, by telephone, by TV screen, by the in-home salesperson) thoroughly logical. In-home shopping and the vending machine (which, is big apartment houses, will permit a form of in-home shopping from within the building) promise to be two of the fascinating marketing developments of this decade. (Further evidence supporting this prophecy is found in the fact that, in 1960, more mail-order catalogs were distributed than ever before! And Sears reports that its mailorder business is once again in a true growth situation.) Conclusion: During the 1950 to 1960 decade, mass retailing made little progress in stepping up its sales per square foot. Indeed in many of the newest giant one-stop store units, the square-foot performance record in many departments is downright disappointing. As the number of giant one-stop store units continues to multiply,



and as they compete more vigorously with one another, it will become a still tougher problem to lift the square-foot performance (and the average ticket) in these huge outlets. We are not suggesting that this problem should not be met head on. It should be; it must be. But simultaneously, advantage should be taken of the fact that giant store units make feasible, as well as necessary, mail-order selling, telephone selling, in-home selling. These techniques for reaching out to the shopper cannot be adequately developed by small stores; they are almost the exclusive opportunity of the giant store. And that opportunity is made still greater (1) by technological developments to which we have referred, and (2) by the changes in public shopping habits to which we have referred.
Coming: True One-stop Outlets

For generations, department stores were considered—and properly so—to be one-stop outlets. They were certainly the first one-stop outlets (other than the early crossroads general stores). More recently, other types of mass retailers turned to their own versions of a one-stop outlet. The food super announced its type of one-stop outlet. So did the variety chains. So did the drug chains. And so did the big mail-order houses. Most recently, the discount chains began to open their versions of a one-stop outlet. But the fact of the matter is that there are but a tiny handful of true one-stop stores in this country. We have one-quarter stop outlets, one-half stop outlets, three-quarter stop outlets, but very few outlets planned and geared to cater to all of the requirements of the modern shopper. Modern-shopper Wants Have Multiplied Fast: Now it would be ridiculous to take the position that a store can claim to be a true one-stop outlet only when it inventories every blessed item that even the lunatic fringe shoppers might think it needs. But it happens that the requirements of modern mass shoppers—that is, the day-by-day requirements of those of our shoppers with ample discretionary income—have expanded and diversified more rapidly than has been true of the expansion and diversification of inventory of most of our so-called one-stop outlets.



Thus, the department store did an inadequate job of keeping up with the modern-shoppers' requirements in appliances, in boats, in various services (travel, for example), in autos, auto accessories and parts, gas and oil, etc., etc. Yet these newer categories and services have been accounting for a rapidly growing percentage of the shopper's total dollar. Consequently, whereas the department stores of the early part of the century may have catered to the bulk of the shopper's requirements of that era (other than food), today most department stores have fallen farther and farther behind in this respect. The newer so-called one-stop outlets of the food supers, the variety chains, and the drug chains are even less equipped to cater to the hugely diverse requirements of the modern shopper. And this is also true, although to a lesser extent, of the largest stores of Sears, Ward, etc. Perhaps 50 years ago, when living standards were so much lower and so much more simple, a 100,000-square-foot store might have been able to cater to practically all of the needs of the shoppers of that era. Today, however, even a 200,000-square-foot store really cannot perform this function adequately—and even the vastly larger downtown stores of the greatest department stores fall quite short of that achievement. But it isn't merely size of store that qualifies an outlet as a one-stop outlet. It is also its ability to pack into its total square footage the remarkably diverse merchandise and service requirements of a population whose needs have exploded. And this is something that precious few giant store units have been able to do to date. The Supercenter: There will soon loom on the retail horizon, a new mammoth retailing unit that will come quite a bit closer than 99 per cent of existing mass retailing units to lay claim to being a true one-stop outlet. An example would be a truly giant supercenter that was being built, at the time of writing, in the suburb of a Midwestern city. Under one roof and one management there will be a complete department store, a 60,000-square-foot food super, a complete drug and hardware store, a big range of service facilities (beauty shop, barber shop, shoe repair, dry cleaning, etc.). In several other sections of the nation, a few similar stores are



going up. They will run from 350,000 square feet (all on one floor) to 600,000 square feet—and all under one roof. They may not be as huge as a very few of our largest downtown department stores— but, insofar as the current requirements of the modern discretionary shopper may be concerned, they will probably come nearer meeting these needs than the few older stores that overshadow them in size. The true one-stop outlet is not to be judged exclusively by its square footage. It must be judged equally by die diversity of its inventory and by the degree to which this inventory is able to cater to the existing and the expanding needs of mass shoppers. When a gigantic store does an inadequate job of merchandising garden equipment and supplies, an inadequate job of merchandising the newer services, an inadequate job of merchandising rentals, an inadequate job of merchandising the rapidly expanding fields being invaded by coin-operated devices, an inadequate job of merchandising home repair and modernization requirements—then it just isn't a modern-day one-stop outlet, no matter if it occupies 750,000 square feet in a single building. Moreover, when such giant stores cannot furnish adequate parking places, when they are difficult to reach by car, then they are also not true one-stop shopping centers because these facilities are part and parcel of modern one-stop shopping. Actually, the nearest that retailing has ever come to true one-stop shopping has been the Sears catalogs. And even here there have been big gaps—for example, until recently, the Sears fashion lines, as featured in the catalog, have trailed behind modern requirements and have still to catch up. Even the huge shopping centers have not provided true one-stop facilities because the enormous areas they occupy are not compatible with true one-stop shopping. When it becomes necessary to move one's car to shop various stores in a giant shopping center—and this is commonplace—then to this degree as well as from other aspects, that gigantic shopping center is not a modern one-stop outlet. How Many True One-stop Outlets? Actually, there will not be more than perhaps 100 true one-stop outlets in this nation. And we may not have that many before 5 years or more. (But, since these 100 outlets will probably do a volume



well in excess of three billion dollars, they will be major factors in mass retailing.) Why will the number be so drastically limited? First—in the 60 years of this century during which department stores have grown, no more than 100 ever became really giant stores. Indeed, no more than 50 would qualify as giant store units by present-day standards. Second—it is very much of a question how many shoppers really want to do even the bulk of their shopping in a single store, under a single roof. While shopping may no longer be entertainment, while the shopper may want to buy more and more of her total requirements in less and less shopping time—the desire to compare, the desire to look elsewhere, will continue to exist. There probably are more one-stop shoppers today than ever before. But the total still does not constitute anything like even a significant minority of our discretionary shoppers. Third—a mounting percentage of shopping requirements today involves big-ticket items. It is difficult to remember that 50 years ago really few families made big-ticket purchases more than once in a lifetime. But today, and even more so tomorrow, a wide variety of consumer purchases represent and will represent big-ticket categories. Big-ticket purchases are shopped—and the more big-ticket purchases a family makes, the more shopping that family will do. Fourth—a vast amount of shopping is done impulsively. The total grows all the time. This of course benefits the one-stop outlet; it is a basic reason for its existence. But it also works against the one-stop outlet because the shopper is apt to make an impulsive purchase wherever she may be. Thus, it may be properly concluded that while the total number of the true modern-day one-stop outlet stores will be quite limited (even the locations suitable for this type of operation are limited), they will nonetheless become major facts in mass retailing. Moreover, they will compel many of the present so-called one-stop outlets to become ever larger. The Coming Era of Giant Store Units: There is no question at all that mass retailing faces, over the next five years or so, the following probabilities:



1. There will be many more stores of over 100,000 square feet than ever before. 2. The number of stores over 300,000 square feet will triple. 3. The number of stores over 500,000 square feet will multiply by five. And the total number of stores carrying inventories geared to the immensely broad needs of the masses of our discretionary shoppers will increase greatly. Of course, as always happens, a major trend of this dimension will produce a reverse trend—a trend toward small specialty stores. This is inevitable. But insofar as big volume is concerned, insofar as the dominant objectives of mass retailers are concerned, the great trend will be the trend toward great store units.
The Coming Trend to Luxury Stores

With the net-profit percentage in mass retailing showing few signs of dynamic rise, and with return on investment in mass retailing showing an even more dismal performance—will a trend set in for a new form of store that could lift sharply both net-profit and investment-return ratios? The answer is "yes." A new type of store is now emerging among mass retailers. It is a luxury store—a store that makes no pretense of battling it out on the price front. Neither does it make any pretense of being a mass outlet in the true sense of that term; its appeal is to those shoppers who are particularly well heeled. Oddly, it is coming along at precisely the same moment that mass retailers are either opening their own discount stores or opening leased departments in discount outlets. Thus we see two directly contrary approaches to some of the current problems of mass retailing. We propose analyzing the new approach—the luxury store unit. Where It Started: As has been true of so many of retailing's great trends in recent years, this concept of a luxury store unit operated by a mass retailer got its start in the food outlet. The food supers found they were getting a fantastic response to their gourmet sections. They also found that their more affluent customers were beginning to object to ordinary selections, to self-service, to no credit, to lack of the priv-



ilege of telephone shopping. So they added two and two and came up with the formula: A modernized version of the old-fashioned specialty food outlet catering to the wealthier families and offering most of the services of a previous era. One of the food chains in the East started such a store in the socalled silk-stocking area of New York. It clicked immediately. Not only was its volume above expectations—an unusual experience for the food super these days, since most new store units in the food field tend to do less than the planned figures—but the net-profit ratio and the return on investment were highly gratifying. The consequence was that this food chain has since added additional stores of this same type. Moreover, at a stockholders' meeting, its chief executive officer told stockholders that "We are placing particular emphasis on the rapidly expanding luxury areas of Manhattan where we are opening luxury-type stores." Since then, in other areas, other food chains have made similar moves. The first steps have been cautious. Now, in at least a dozen major cities, the food supers are moving quite rapidly toward these luxury units. About the same time, several department stores began to open so-called "twig" store units, some of which were also designed to appeal to what was once called the "carriage" trade. Then a few of the drug chains tested luxury-type outlets. Since then, chains in almost every retail field have been testing these affluent store units for affluent shoppers. Interestingly, one top executive of a large chain is firmly convinced that shopping in luxury-type stores may become a new form of social status. His point is that many people are always looking for something to flee to that will enable them to flee from what everybody else is doing. He concludes, therefore, that the time has now arrived when many shoppers will want to disassociate themselves from self-service shopping—from standing in long check-out lines. He believes they will tend to turn to modern versions of the old-type luxury stores which delivered their packages in carriages pulled by a spanking team of high-stepping horses and manned with even a footman in livery! In brief, on the one hand we have too few retail outlets today in which the more affluent of our affluent shoppers can achieve so-



cial status by shopping for the everyday requirements. On the other hand, even aside from social status, it is believed that enough shoppers to constitute a good market would like once again to shop for everyday needs in a genteel atmosphere, with full service, and for qualities and grades of everyday supplies not generally available. So these two factors are being played to the middle—and the middle is a new type of luxury store. Obviously, if this reasoning is sound—and there is little question that the appeal of these carriage-trade stores is strong, whether or not the philosophical reasoning of the causes is correct—then the trend to these luxury stores will spread out. We think it will. Now, Some Questions: Question 1—Will these carriage-trade type of stores ever assume really big proportions with respect to total volume? Probably not. Some chains could conceivably account for perhaps 10 to 15 per cent of their dollar volume through this type of store unit. However, the net-profit ratio and the return on investment could be excellent— and it is not improbable that, for some chains, these luxury stores could account for up to 25 per cent of total net profit and could lift quite considerably the chain-wide return on investment. Question 2—In what locations will these carriage-trade type of stores do best? The easy answer would be "in carriage-trade areas." But that is not necessarily entirely so. Fifty years ago, the lines of demarcation between carriage trade and the horse trolley trade were sharply defined. That is no longer true today. We are still not a nation of superaffluents. But we are a nation of affluents. Moreover, for various reasons—including that hugely potent reason of social status—shoppers cross over that line of demarcation between the wealthy and the not-so-wealthy much more easily than was the case years ago. This is why even Bergdorf-Goodman has a special shop now for "working gals"; they are called "career women" these days, but they are sisters under the skin. So—don't conclude that only the highest-income areas can support this sort of store. It ain't necessarily so! Question 3—Will these stores have much "transient" trade? Yes they will. They will, of course, have a hard core of regular shoppers, but they will also draw trade from other shoppers who will want to patronize the store on special occasions, for special purposes—



and these transient shoppers will come from considerable distances, assuming the merchandise selection is unusual and will warrant the extra travel. In other words, traditional formulas for measuring the potential market for one of these stores just won't work—new yardsticks will have to be developed, and at the start, the retail executive will have to fly by the seat of his pants. Question 4—Will these stores have to be full services? Yes they will. Moreover, they should feature new services, super services, services that are not generally available. Incidentally, in this connection, it should be remembered that among the unexpected shoppers in this kind of store, will be many women who work. These women will be particularly attracted to these stores by some of the services—they clearly find it extremely difficult to find the time to shop in huge self-service outlets; and even when they have the time, they tend to be too tired. Moreover, those millions of men who have been doing the shopping because their wives haven't the time are beginning to rebel also. So in some instances, it will be difficult to tell whether it is the luxury of the inventory or the luxury of the services that is more appealing to the shoppers. The object, of course, should be to make both extremely appealing. Question 5—Can these stores be run under the same name as the name of the parent chain? In some instances, yes. In more instances, where, for example, the parent organization has been operating at a pretty low social level, a different name may be advisable. Generally speaking, since the snob appeal will surely be a factor, a different name would probably be preferable. Some mass retailers who have opened discount outlets tend to do so under a different name. There may be more reason for this same decision with respect to the luxury type outlet. Question 6—Must all of these stores be identical? Not at all. They will vary in size, in decor, in type of inventory. Surely it is logical to conclude that where one is planning a type of outlet to be distinctive, uniformity is hardly the fundamental way to achieve that touch of snobbish distinction. Question 7—What about the age bracket of the typical customer? In the first place, there is no such thing as a typical customer; not in any kind of store. In the second place, it will be found that in these stores, customers will vary remarkably by age groups, by income levels, by all standards of measurement. They will probably



tend to be older than die customers in traditional mass outlets—but here again, this will vary among the regular customers of the outlet and the transient customers. Maybe it would be safe to conclude that the regular customers will be somewhat older—the transient customers of almost any age. Question 8—What about price lines? The object is to get above traditional price lines in the regular stores. This is part of the snob appeal—it is part of the entire appeal of the store. And there should be some price lines stocked as much for window dressing as for actual volume. The basic objective is to create a carriage-trade atmosphere, and this can't be done when mass price lines are too much in evidence. Question 9—How about staples vs. specialties? Clearly, there will be staples—although they will be above the traditional level of staples. But emphasis should be strong on the specialties—indeed on superspecialties. New merchandise should also be liberally represented. The markets of the world should be scoured—the object in inventory is to find the unique, the extraordinary. These stores, to some degree, should be a store-wide application of the boutique idea so successfully developed by department stores and which, come to think of it, was also a sign of the times that led to the trend toward the carriage-trade type of store. Conclusion: We have frequently remarked that one great trend inevitably leads to a trend in precisely the opposite direction. The great trend in mass retailing has been toward uniformity, toward low margin, toward huge stores. This trend will continue. But right now there is evidence that a reverse twist is setting in. It won't replace the existing trend. But it will complement the existing trend. And once again, it will represent a full turn of the circle. Just as mass retailing went from the crossroads general store to the specialty store and then back to the general store—so now mass retailing, to some degree, will begin to move back to the specialty store.
Consumer Goods Leasing—a Fast-growing Retail Service

When the giant Hertz Corp., leaders in auto-truck renting, announced the opening of three "rent-all" stores in Chicago, and de-



clared that this was the forerunner of a nationwide chain, there was no longer any doubt that consumer goods leasing or renting had jumped into a stage of explosive growth. (When the giant Sears Roebuck announced a similar plan for hundreds of its stores, consumer goods leasing leaped ahead.) The Hertz program contemplates both its own national chain of stores renting a wide variety of consumer goods and operation of franchised stores in smaller communities. This corporate giant obviously has the financial muscle to develop consumer goods renting to the stature of a truly big retail function. Indeed, it is entirely probable that, in time, the Hertz chain of car-renting stations will become part and parcel of the consumer goods renting operation— which means that this could become one of the great chains of the nation. In addition, there are scores of other consumer goods renting services. One of the larger ones is United Rent-Alls, Inc., of Lincoln, Nebraska, which has some 315 franchised rental stores in 46 states. As a matter of fact, if autos are included, it is reckoned that perhaps three out of ten American families right now rent one or more items of consumer goods. The organizations that are operating in this field believe that this figure will soon become five families out of ten—and ultimately nine families out of ten. Moreover, it is anticipated that the variety of items rented will increase even faster than the number of families renting consumer goods. Thus, this market is growing from both ends, so to speak. Tart of the Trend Toward the Retailing of Services: Our major retailers are planning a vast acceleration of departments offering services. Sears has announced this as a specific new policy and program—and Sears has stated that service departments offer mass retailers unique opportunity for dynamic expansion. Renting consumer goods is a service department. It fits right into this trend. It is entirely probable, therefore, that all types of mass retailers will take a new and open-minded look at the renting of consumer goods as a potential source of additional volume and additional profit It may very well develop—and rather quickly—into the fastest growing of the newer service departments and the one with the largest potentials for substantial dollar totals.



It is estimated that in 1962 consumer renting hit a $100 million annual pace. Projected figures indicate a billion-dollar potential within five years. There aren't many of the newer service departments with such a potential—and this is why consumer goods renting merits prompt and deep study. Where It Started: The renting of consumer goods has, of course, been a retail service for many years. Fifty years ago, in the larger cities, there were a few retailers who rented formal evening clothes for men. For many years, bridal gowns have been rented. It is probable that the renting of autos was preceded a century ago by the renting of a surrey with a fringe on top. Slowly the scope of consumer goods renting services expanded. Then came Hertz and the idea of renting autos. Then came truck rentals. Most recently, it has become possible to rent airplanes. Small retailers opened up here and there offering a variety of consumer goods on a rental basis. One of the early services of this land was the floor waxer. Then came little shops offering larger garden tools for rent. Women's fur coats became pretty popular as a rental item. So did color TV sets, pianos. But it has been only for the last two or three years that some large retailers have begun to indicate an interest in the rental of consumer goods. And this interest by large retailers has stemmed, in turn, from a clearer understanding of the social and economic trends that have made it logical for more and more families to rent more and more of the total home inventory. Where It Is Heading: The rental market is clearly heading toward the objective of making available to the American family on a rental basis a substantial percentage of the total home inventory. At the moment, the principal new rental items are being found in those products that involve a fairly substantial investment by the public, and which may be used rather infrequently during the year. Garden tools, for example. Much the same would be true of many items involved in vacation trips. For example, luggage of certain types is doing quite well as a rental category. Then there are those special events staged in the home. Home



bridal events will call for the rental of an amazing variety of items ranging from candelabras to chinaware to carpets and rugs (a full dinner service for eight, including china, silverware, tableware, and napkins can be rented for about $9.00). An interesting example of consumer goods rental potentials is found in the rapidly growing "second home." More often than otherwise, the second home is a temporary abode—usually a summer home. It may be in use for only three to five months. As a consequence, it is entirely probable that a substantial percentage of the owners of second homes could be persuaded that it will be less costly, less troublesome, to rent more of the total inventory of the second home than might be the case with respect to the inventory of the primary home. However, the proponents of consumer goods rental services claim that the public ferrets out more ideas for new areas of rentals than do the retailers offering the service. Their experience has been that the more the public rents—the more it thinks about the whole rental idea. Clearly, auto renting has played a role in the increased willingness to rent candelabras. Clearly, the renting of home linens has increased the willingness to rent chinaware and silverware. Clearly, the use of home catering services (which is really a form of rental) has increased the willingness to rent many items. Certainly the rental of baby diapers increased the public's willingness to rent not only other baby items but a wide variety of consumer goods. And certainly the renting of innumerable items for the second home will make that family that much more amenable to the idea of renting innumerable items for the primary home. Why Is the Public Renting Consumer Goods? Why is the public increasingly willing to rent a wide variety of consumer goods? The reasons can be summed up as follows: 1. Some segments of the public are concluding that "possessions'' are for the birds. They'd rather rent than possess. 2. Many people have concluded that it is "foolish" to tie up money in items that may be used for only a small part of the year. 3. Lack of funds, or lack of credit, or both may be a common rea son for renting. In other words, this may really be a new form of credit!



4. The growing multiplicity of products and services required in our affluent society may compel many families to rent. 5. In many instances, the solid economics of rentals will encourage some families to rent rather than to buy. (A good factual story can be developed proving that rental charges will total less than the total cost of possessing certain items—clearly this has been one of the reasons for the phenomenal growth of car rentals.) 6. The increasing variety of activities of so many families prac tically compels rentals. When the members of one family have am bitions that encompass two autos, a boat, golfing, fishing, hunting, multiple vacations—rentals become logical. 7. Storage or space problems in the home frequently necessitate rentals. 8. The trend toward two vacations a year plus longer week ends, which are very often vacations, combine to make rental of certain consumer goods sensible. 9. Even the trend toward larger families plays an important role. 10. More leisure hours have brought about more leisure-time ac tivities—many of these activities involve consumer goods which per haps one would do better to rent. This might be particularly true of "new things" that families plan to test. 11. Very often the purchase of a new home makes such a dent in the family budget that the home cannot be adequately furnished or equipped for a considerable time. Rentals may alleviate this prob lem—the home doesn't have to be "bare" or underequipped. These are by no means all of the factors that are combining to lead the public to give increasingly favorable consideration to the rental of a spreading variety of consumer goods and services. But they make clear that powerful socioeconomic forces are propelling big segments of the public in this direction—and these socioeconomic forces are still gathering momentum. (Even resignation to despair over nuclear warfare may lead some families to conclude "Why should we buy—let's rent.") How Retailers Will Move into Renting: Retailers will move into the renting of consumer goods by: 1. Tying up with one or more of the franchise services now avail able. This could involve a leased department operation. 2. Bringing together the rental services now operating into one



department—and then planning for the expansion of that department. 3. Combinations of these two plans may be developed—in a giant store unit, the retailer may run the rental department himself; in a smaller store unit, the rental department might be a concession. But whatever procedure is adopted—every sign of the times points to a vast expansion of consumer goods rental.
Expansion Ahead for Service Departments

For many giant retailers, the fastest-growing (and perhaps the most profitable) departments for the next few years will be departments merchandising a mushrooming variety of services. This promises to assume the proportions of an extraordinary development. It means that some large retailers whose service departments have represented only 1 or 2 per cent of total volume will be reporting, within a few years, up to 10 per cent of their total volume from these departments. And it may mean, for some large retailers, that service departments will be contributing as much as 15 per cent and even more of total net profit. The service department is by no means new in mass retailing— optical departments, beauty salons, watch repair departments have been common for many years. But top management has tended to give small executive consideration to service departments. Now, however, an era of vigorous competition in the development of service departments looms directly ahead. Consequently, store management will be compelled to train its sights on these departments and this, in turn, will compel a marketing reappraisal among some manufacturers. First—what is the range of the service department? The service department, traditionally, included the big three— beauty salon, optical, watch repair. These three will become larger. Then the secondary and tertiary service departments will expand. These will include various repair services—ranging all the way from handbag repair to fabric mending. Areas for Service Department Expansion: But these represent merely the beginning. From these points, the service departments will be broadened to include such areas as: 1. Supervision of home construction—especially with respect to



the second home for the two-home family, and especially involving prefabricated homes. 2. Extension of the home decorator service and other professional and semiprofessional services—for example, bridal service may be extended to include the wedding itself. 3. Addition of merchandise departments which formerly were either nonexistent or were laggards because they involved some de gree of service—the recent growth of auto tire departments would be an example. 4. New types of home-aid services. Rug-cleaning service would be just one example. In hundreds of communities, small services have sprung up which supplant the domestic servant: dusting, wax ing, window washing, etc. These will be taken over by large retailers. 5. In addition to selling garden supplies, mass retailers will ar range to mow lawns, take care of the garden, offer professional planning services for gardens. 6. Diaper services will be offered. Ditto for linen services—per haps complete laundry services. 7. Insurance and mutual funds will be sold both over the counter and in the home. Estate planning will become a function of the large retailer. 8. Now that dry cleaning services are to become available via automatic machines, some mass retailers will definitely offer this service, as well as automatic washer or launderette service. 9. The various service chains that have sprung up to service the automobile—seat cover chains, muffler chains, etc.—will be dupli cated by large retailers. 10. The credit card will be sold by big retailers. Why not? 11. The rental concept will be exploited as a service function— this will include not only rental of home appliances, power tools, etc., but even auto and perhaps truck rental. 12. Home repair and home modernization services will be offered by retailers. The list of existing and potential service departments is a long one. It is reported that Montgomery Ward has under con sideration no less than 69 types of consumer services! (The Chair man of the Board of Sears Roebuck has publicly announced that Sears will concentrate strongly on the expansion of present and new service departments.) And, with respect to Sears, it is pertinent to point out that Allstate Insurance Co. (a service department) will



pay $20 million in dividends to the parent Sears organization this year—a larger net profit than the net profit of most mass retailers. Service departments tend to offer the following advantages to mass retailers: 1. The requirements for space on the selling floor are usually small. The dollar volume per square foot of selling space is usually extremely high. 2. The need for reserve stock area and for warehouse space tends also to be low by traditional standards of regular departments. 3. Mark-downs tend to be considerably less than store average. 4. Margins tend to be particularly attractive. 5. The various types of discount chains may eventually get into most of these service departments. But they will tend to lag behind in their service department expansion, which means that, to some extent, at least, large retailers will be relatively free from discount competition in this area. 6. As the public's discretionary income increases, its funds avail able for services actually multiply. The larger the discretionary in come, the greater the demand for services. Thus, the service depart ment is right in line with the great trend toward a larger discre tionary income by larger segments of our population. 7. As the housewife continues to double in brass by working away from home—and as various types of leisure-time activities remove the man of the house from time-consuming do-it-yourself activities —the demand for home services also increases rapidly. These two trends are, obviously, running at full tide. Their importance in con nection with home services cannot be overestimated. 8. As home life and home inventory become more luxurious and more complicated, the demand for services increases. Thus, home catering services have grown enormously in recent years. Thus, the demand for repairs to home equipment has mushroomed. Both of these trends are really in their infancy—actually, machines for the home will approximate some factory machinery in complexity. And just as women either don't have time or inclination for diaper wash ing—so they will tend to have neither time nor inclination for so many other home duties. There are other advantages for the retailer in these service departments. Service retailing, for example, may bring the retailer into the home, where a merchandise sale may then be made. Serv-



ices may be sold on an annual basis, thus producing a predictably annual gross. Leasing Arrangements Will Be Important: The service department will, in the case of perhaps most retail ers, become a leased department. The general trend will be toward turning service departments over to concessionaires. This will be especially true during the initial introduction of a new service de partment. The service department has, traditionally, been a leased depart ment. The beauty shop, for example, in most department stores is concession-operated. Ditto for the optical and watch repair departments. The service department tends to offer logical reasons for leasing. The service department calls for specialized knowledge, and—most particularly—for well-trained personnel, both of which are more likely to emerge from a special organization. Conclusion: As we have indicated, the service department involves merchandise in many instances. But even when it does not involve the sale of merchandise directly—as in home maintenance services—it can have a profound impact on marketing. So—coming up, a service department era for large retailers. And coming up for many manufacturers, a need for new concepts in distribution, promotion, selling, etc.
Why Retailers Weigh Private Brands

The store-controlled brand is receiving deep study by many, if not most, large retailers. Some large retailers have already stepped up their private-brand programs—in certain instances quite substantially. Others are about to expand their controlled-brand programs. What are the circumstances that are propelling so many mass retailers toward own-brand exploitation on a larger scale? The persuasive factors may be summarized as follows: 1. The first and foremost reason why mass retailers are giving greater attention to their own controlled brands stems from their very size. When more retailers reach an annual volume of $2 billion and $4 billion and $5 billion—the more strongly will these giant re-



tailers concentrate in more merchandise classifications on their own brands. In brief, retail financial power begets store-controlled brands. It's just as simple and inevitable as that. Moreover, as the retail giants flex their financial muscles, via the development of store-controlled brands, they compel the next size rank of retailers to follow suit— and these in turn compel still smaller retailers to follow suit, via voluntary chains, wholesaler-controlled groups, etc. Thus the circle spreads out wider and wider—and this process is already very clearly in evidence. 2. The vast similarity in construction, ingredients, and pricing of competing brands definitely encourages the retailer to bring out his own controlled brand. 3. The larger the retailer becomes, the better known his name be comes and the more specifically does his name stand for a guarantee of value. These twin developments obviously are excellent starting points for the store-controlled brand. 4. The very multiplicity of brands put on the market today by manufacturers tends to result in sharper brand confusion. This, too, provides a fine opening wedge for the retailer-controlled brand. 5. Very few manufacturers' brands have a true national distribu tion. Perhaps not 5 per cent and certainly not 10 per cent of the manufacturers' brands can claim a true national distribution. These holes in the distribution pattern of manufacturers' brands provide a great opportunity for the store-controlled brands to infiltrate through these distributive holes. 6. There has been a definite drop in total marketing in shopper brand loyalty. This cannot be disputed. The less shopper loyalty, the greater the opportunity for the store-controlled brand. 7. Shopping for many basics is becoming a split-second affair, and even big-ticket items are being bought in amazing volume in jig time. The faster and more impulsively the shopper buys, the greater the opportunity for the store-controlled brand. 8. Self-service and self-selection clearly make in-store display a major factor, if not the major factor in the volume done by the large majority of manufacturers' brands. The retailer controls the disposi tion of his display space. By giving preferred display space to his own brands, the retailer can back up his own brands with a power ful selling force. 9. The retailer is in closer proximity to the shopper. This enables



the retailer's brand to adjust somewhat more rapidly to changing consumer demand. That is a plus factor for the store-controlled brand. 10. As retailers become larger and larger, they are better able to finance every step of own-brand development, including manu facturing. 11. The large retailers believe that their pricing on their own brands enables them better to nail down their reputation for low, low prices. All but a few of the larger brand manufacturers put most of their pressure on the public outside the retail store. When the re tailer promotes his own labels, he puts most of the pressure on the shopping public inside his store. This may or may not be unfair competition so far as the manufacturer of advertised brands is con cerned, but it certainly is an extremely effective competitive posture for the larger retailer. 12. As new stores involve larger and larger sums, it becomes in creasingly necessary that planned figures be met. It is reasoned that controlled brands will help to this end. 13. A rather interesting reason for controlled brands is the grow ing need among giant retailers for substantial financing. Here it is reasoned that a strong posture with respect to controlled brands may impress investment houses—and there is some merit to this convic tion. 14. Some retail giants believe that their controlled brands are of help in getting new stores off to a faster start. As large retailers spread out geographically, this point has some validity; after all, our shoppers have become exceedingly mobile, and their mobility is increasing daily. 15. As giant retailers develop increasingly complex corporate structures—and this is a positive trend—profits taken on the manu facturing of controlled brands become important in the total netprofit picture. This is part of the trend among giant retailers toward getting a larger percentage of net profit from nonmerchandising functions. Some large retailers earnestly believe that their controlled brands reflect market conditions, and shopper attitude changes more quickly than do many manufacturers' brands. This point is not al ways incorrect. 16. The ultimate aim of giant retailing is control of every step of the manufacturing, distributing, and retailing process—a position



toward which Sears has clearly pointed the way. Just as Sears has found controlled brands the very essence of this long-term strategy, so will more and more giant retailers lean on distributor-controlled brands for the same reason. 17. Their saturation of certain territories makes feasible the ex ploitation of their own brands in those territories on an economic basis. And their trend toward national coverage by smart location of store units makes feasible national exploitation of their own brands. 18. They know that the enormous multiplicity of brands plays into their hands. Thousands of manufacturer brands means brand confusion among shoppers. To sneak a store brand through this fog of confusion is easy. When one giant retailer turns to controlled brands, competing retailers feel compelled to meet this program. There is no question that some large retailers are much more deeply into their own brands than they would like to be—but they feel they cannot ignore their competition in this respect. Thus, distribu tor-controlled brands feed upon themselves—the more active giant retailers become in own-brand promotion, the more deeply involved all large retailers become in own-brand merchandising. 19. These large retailers also know that showing their controlled brands alongside manufacturers' brands tends to accelerate the movement of their own brands. This has been proved thousands of times. 20. The vast similarity among competing manufacturers' brands —similarities in construction, in ingredients, in appearance, in pack aging, and in pricing—also encourages the retailer to conclude that he can successfully market his own brands, particularly when he can feature a lower price. That matter of shelf price differential is crucial—among some food items the retailer's own brands tend to be priced from 8 to 17 per cent lower than the competing brands of manufacturers. 21. Years ago, the retailer was at times hard put to find a supplier for his own brands. That is no problem today. The new merchandise categories into which drug chains, variety chains, food chains, and other large retailers are going include lines in which manufacturer advertising is weak. In these classifications, the giant retailer be lieves he can develop his own brands with relative ease. He is not entirely wrong in this assumption.



22. The net profit picture among most mass retailers has been far from satisfactory. This is especially true of department stores and of variety chains. The food super also complains bitterly about its low net-profit percentage. Private brands may help here. Conclusion: So when it comes to own brands, the giant retailer has clearly concluded "Can do." And he can do, too. Does this imply a flight from manufacturers' brands? No, not really. It may mean that pseudo national brands will be weeded out. It may mean that manufacturers' brands that are weakly advertised will be dropped. But basically, in most classifications, the mass retailer's prime reliance will be placed on manufacturers' strongly presold brands. Moreover, manufacturer brands will continue to predominate for years to come in the higher price lines. However, presold controlled brands of mass retailers will unquestionably take over a growing percentage of the total volume of these outlets. And, in a few classifications, the controlled brand will outsell all others—with the total number of these classifications tending to increase. The controlled brand is on the move. And the time for merely "watching" is already gone by.
More Retail Profit from Nonmerchandising Functions

Traditionally, retailing has looked to the merchandising function for its net profit. Today, retailing is beginning to look to nonmerchandising functions for more of its net profit. Tomorrow, some mass retailers will be getting from 25 per cent to 50 per cent of their total net profit from the nonmerchandising function! And when this comes to pass, those mass retailers who have neglected the nonmerchandising aspect of modern retailing will be at a serious competitive disadvantage. Net profit is the lifeblood of retailing. Net profit on the merchandising operation for most mass retailers either has declined or has barely held its own.



Net profits from nonmerchandising functions, where skillfully and energetically sought, are in a true growth stage. Clearly, the mass retailer who can plus his merchandising net profit with substantial nonmerchandising net profit wins a distinct competitive lap. So let's take a look at this enormously important new revolution in the long-term strategy of mass retailing. What Are the Sources of Nonmerchandising Income? 1. Many, if not most, allowances granted by suppliers constitute nonmerchandising income. This is especially true where the allow ance is really related to the buying function—not to the selling func tion. Some allowances give the retailer the aspects of a landlord; clearly, the landlord is not a merchandiser. Despite Robinson-Patman, it is amazing to note the variations in allowances granted to competing retailers making purchases of equal size. Allowances tend to be very loosely managed in most mass retail organizations. They are too seldom meticulously planned, checked, followed through. 2. The more effective use of capital can be an extraordinarily potent source of nonmerchandising income. The larger a retail organ ization becomes, the more dominant becomes its management of finances as a contributor to net profit (we will discuss this in more detail in the section on real estate). Example: A large chain has reduced the time from site selection to store opening from two years to one year. Consequently, its land inventory dropped from $49 mil lion to $22 million—thus freeing some $27 million for other pur poses. It also obviated the need to go to banks for loans. 3. When mergers are analyzed, it will be found that nonmerchan dising considerations may play as big a role as the merchandising function. Example: A drug chain buys a women's apparel chain. The latter has a $5,000,000 tax loss carry forward. Another exam ple: A chain buys out a manufacturing company in process of liqui dation. Here, also, tax loss considerations played a big role—plus the fact a large financial institution, deeply involved in the defunct manufacturing company, made substantial financial investments in the new organization. 4. That last example involved a retailer going into manufactur ing—this retailer will sell the output of the factories acquired not only through its own chain but through other retailers as well. Some



food supers have set up subsidiaries that handle nonfoods not only for the parent organizations but for other noncompeting food outlets as well. This is a nonmerchandising function. 5. The development of the holding company concept in mass re tailing—which is a strong trend—involves corporate maneuvers that can throw off an extraordinarily large net profit primarily through the exchange of pieces of paper. This is a nonmerchandising func tion. 6. Making choice financial connections is becoming a matter of top importance in the vast expansion plans of giant retailing. This is a nonmerchandising function. In combination with other nonmerchandising functions discussed here, this puts a new spotlight on the store controller. He emerges as a top executive with great au thority. It also raises a question whether, in future, the heads of great retail organizations will be selected more for financial acumen than for merchandising acumen! This, of course, has already hap pened. 7. We have referred to the entry of retailers into manufacturing. This promises to become a powerful trend. Profits from the manu facturing operation are not retail merchandising profits. So here is another source of nonmerchandising income. 8. The store-controlled brand, in many of its aspects, provides nonmerchandising income. Since the store-controlled brand is right now being almost feverishly expanded by large retailers, it promises to become a substantial contributor to nonmerchandising income. (In some instances, retailers will sell their controlled brands to noncompeting outlets—this, obviously, will throw off net profit that can not be classified as retail merchandising profit.) 9. The wholesale-warehousing function performed by many re tailers is not a retail merchandising operation strictly speaking. It is only indirectly related to the movement of merchandise off the retail floor. In some instances, this function is lodged in a subsidiary organization, which means it receives its own accounting analysis. 10. Credit retailing involves financial aspects that are not strictly retailing merchandising. Here, again, the trend is for retailers to form a credit financing subsidiary. Since all mass retailing is turning to credit—the astute management of the retail credit function is ex pected to throw off a net profit apart from the merchandising opera tion. 11. Real estate is, of course, the great source of nonmerchandis-



ing income for retailers. Because it so clearly marks out the remarkable role that real estate is—and will be—playing as a source of retail net profit we propose explaining in some detail the real estate program of a large food chain. There is no question that this plan will be adopted and adapted by many other large retailers. This food chain formed a shopping center subsidiary. After just four years, this shopping center subsidiary was able to claim that it is the largest developer and operator of shopping centers in the entire country! The food chain owns approximately 44 per cent of the common stock of the shopping center subsidiary and 100 per cent of its preferred stock. Thus, the major part of the real estate profits will go into the food chain. The chain has the exclusive right to lease the portion of each shopping center developed by its subsidiary for a supermarket. The shopping center subsidiary, in late 1959, owned or leased 35 shopping center land sites in eight states. Eighteen of these locations, on that date, had centers in full operation. By the end of 1961, the shopping center subsidiary had doubled its 1959 rentable square footage. (No less than 33 shopping centers were in operation by the end of 1961; rentable space jumped from 2.4 million square feet to an estimated 4.8 million square feet.) Does this vast real estate program require great working capital? No, it doesn't! Bank loans are used to finance the construction program. Long term debt finances the completed and operating centers. Original equity and bank loans might be utilized to construct, for example, $10 million worth of shopping centers. These can be mortgaged for some $8 million. That $8 million is used to build additional centers. These additional centers are then mortgaged for more millions. Actually, the original $10 million of equity money could finance perhaps $50 million in shopping centers. Then, of course, as the shopping centers are opened, the real estate subsidiary develops additional equity from cash flow, and from any appreciation in the value of its operating centers. Thus, still more construction financing may be obtained. Conclusion: It is not improbable that this food chain will report in excess of 20 per cent of its total net profit from "other sources" by the end of 1961 or 1962. And it may be that, by 1965, when the shopping



center subsidiary is in full swing, the parent corporation may report "other sources" income equal to 40 per cent and more of its total net profit. Now the food super chains are not doing too well with the net profit on their merchandising operation. There is little reason to expect any dramatic improvement in net from merchandising. But, clearly, if one food super chain obtains a dramatic improvement in its net from nonmerchandising functions, it will win a decided competitive advantage. What is true of the food chain is true of most other chains; it is equally true of most large department stores. The mass retailer, with few exceptions, cannot look to the straight merchandising operation for a big gain in net profit. But the mass retailer can—and very likely will—look to many nonmerchandising functions for a sizable jump in net This need not mean a slighting of the merchandising function. But what it does mean is a realignment of organizational functions so that the organization is properly staffed for nonmerchandising as well as merchandising functions (and, from the corporate standpoint, properly planned for subsidiaries, holding companies, etc.). It means a clear-cut strategic program by top retail management for intensive exploitation of nonmerchandising, accompanied by equally intensive exploitation of merchandising. Here may be a major answer to the mass retailers' great and even desperate need for a sharp upturn in net profit.
What Do Retailers Know about Walk-outs?

The great X factor in mass retailing is the walk-out—the customer who walks out either without making a purchase, or who buys only one-half or one-quarter of what she set out to buy. Few retailers can answer, without making the rankest kind of guesses, such questions about walk-outs as these: 1. What percentage of the traffic on the floor walks out without making a single purchase? (Among department stores the figures run up to 70 per cent; among variety stores—up to 40 per cent. Ditto for drug chains.) 2. How does that percentage vary by the day of the week, and by the hour of the day? And what accounts for these variations? 3. Do as many men walk out as women?



4. Are feminine walk-outs more common among older women, middle-aged women, young women—married women or single women—and why? 5. Of those who walk out on any given day, what percentage came in looking for something specific? Of these, what six mer chandise classifications being sought accounted for the largest per centage of walk-outs? 6. What connection could or might there be between price lining in certain departments and walk-outs? Do more customers looking for higher price lines walk out, etc.? Why? 7. If only 10 per cent of those who walked out without a single purchase on a single day made an "average" purchase—how much would this add both to gross and net? 8. Few retailers have ever stationed someone outside the store doors and scientifically interviewed walk-outs—at the very moment they are taking a walk. Few have ever taken the names and ad dresses of walk-outs—and arranged to put them through deep in terviews in their homes. Another Look at Walk-outs: All retailing is geared, today, to cater to the impulse shopper through the mass display of merchandise under self-selection and self-service techniques. And these mass displays consist primarily of brands that have been presold in varying degrees. One could easily conclude, therefore, that walk-outs—full walkouts, half walk-outs, one-quarter walk-outs—should be at an alltime low. After all, this gigantic exposure of brilliantly packaged presold brands that can be picked up with merely a flex of the wrist —plus enormous public purchasing power, etc.—seemingly guarantees a sharp reduction in customers who walk out unsold or only partially sold. Yet there is every reason to believe that in most stores today, more customers walk out without making a purchase—any purchase at all—than ever before in the history of modern retailing! And even more walk out without buying half of what they set out to purchase. What's the Explanation? Why? Certainly it isn't because the public wants to spend more time shopping. Certainly it isn't because shoppers don't have faith



in known brands. Certainly it isn't because purchasing power is anemic. Certainly it isn't because the public hasn't faith in mass retailers. No, these aren't the reasons at all that account for full walk-outs, half walk-outs, quarter walk-outs. Call in the Research Expert: And the reasons never will be known unless and until retailers make as scientific a study of the walk-out as they have made of the application of automation techniques to the paper work of retailing. The unfortunate fact is that the latter is, indeed, being scientifically studied; the former isn't being studied at all. The unknown customer of retailing is the customer on the floor who makes no purchase—or who doesn't complete her predetermined shopping requirements. And she happens to be the most numerous of all the customers of modern retailing. This is self-evident because when even 60 per cent of the traffic walks out minus any purchase then the retailer has more nonbuyers than buyers. When 80 per cent walk out without making a purchase—and this is not uncommon—then there are 4 times as many nonbuyers as buyers! Another Approach: Let's twist this around a bit. Most buying of retailers is premised on a study of what the customer has bought. Correct? This is particularly true of reorders— reorders are premised almost completely on the buying action of the customers who have bought. But what of the 30 per cent, or 50 per cent, or 70 per cent—or more—of customers who came, saw, listened, and looked and who didn't buy? Retailers like to believe that "We give the customer what the customer wants—our sales records tell us exactly what the customer will buy." But looking at last year's or last season's sales records merely tells what a minor percentage of the traffic wanted. Don't Be Misled: Of course, walk-outs must be analyzed with common sense. For example: 1. It is utterly impossible to sell every shopper who walks into



a store. Some shoppers, especially for certain purchases, still want to shop. (No store can stock everything any customer may want— and it would be silly to try.) 2. Or maybe a final decision must be made by "Pop," or by the teen-age son or daughter, or by the family as a group. 3. Or maybe the budget just won't permit a purchase that par ticular day. But the fact still remains that every solitary walk-out, every minute of every day, must be suspect. Just like the child who is forever asking "Why"—so retailers must everlastingly ask "why" with respect to walk-outs. And that "why" must be a scientifically posed query. Any other kind of approach could be, and probably would be, totally misleading. For example, simply to buttonhole walk-outs and ask them: "Why didn't you make a purchase?" would lead to totally misleading answers. Maybe the shopper thought prices were too high or is ashamed to admit that her purse may be lean. Maybe she is the type who doesn't like to offend anybody—so she won't make any criticism. This calls for modern research techniques—developed and applied by capable research technicians. Anything else either will fail to find the correct answers—or may prove downright false. What is more, research into the shopper who purchases only half or a quarter of what she set out to buy is even more demanding than research into the shopper who walks out without any purchase at all. Look at it this way: When a retailer adds to the shopper who makes no purchase at all, the shopper who buys only half or a quarter of her requirements, the merchant may wind up in many outlets with almost 100 per cent walk-outs! That's right, in the stores of most retailers, almost 100 per cent of the daily traffic walks out either with no purchase or with smaller total purchases than it had set out to make. This is an extraordinary situation. And it is especially extraordinary in this era of presold brands, of mass display of merchandise by ingenious techniques, and split-second shopping, etc. Some Possible Approaches: Here are some possible explanations for the various types of walkouts: 1. Buying policies that compound the initial error in merchandise



selection because they follow the dictates of the minor part of total floor or departmental traffic—basing buying on the 20 per cent or even 40 per cent of shoppers who buy is unquestionably one of the great culprits. 2. Too much time lost in completing the buying transaction— probably more purchases are deferred in certain categories because time ran out than because funds ran out! 3. Unbalanced stocks, poor assortments, etc. 4. Failure to have the right merchandise, at the right price, at the right time. 5. Inadequate "silent selling"—meaning poor signs, poor pack ages, etc. 6. Inadequate personal selling—where personal selling continues to be a factor. 7. Stores that are too orderly, that have too few interrupting notes. 8. Inadequate facilities during peak hours—the very hours when most mass retailers account for the major part of their total volume.
Be Flexible: Grand Strategy for Mass Retailers

Recently, an executive head of one of our largest traditional retailers remarked: "If we conclude that enough of our shoppers want to shop in a discount type of outlet, we'll open that kind of outlet." When that retail executive made that remark, such retail giants as Woolworth's, the Allied Department Store chain, the Federated Department Store chain, a score of giant food chains, several big drug chains, a number of women's and men's specialty chains, had all decided to open discount outlets. It would appear then, as though this retail executive and his giant organization had been dragging their feet with respect to this potential change. And that underscores what we consider to be today's major strategic requirement for mass retailing. Summed up in just one word, that major strategic requirement involves: Flexibility. Too Little, Too Late It may rarely have been strategically wise in retailing (or in any business) to lay down a grand strategy and then determine to stick with that grand strategy through thick and thin. Even a Lord & Taylor is moving powerfully into the suburbs and will soon be doing a larger volume in the suburbs than at its Fifth Avenue store.



Even a Bergdorf-Goodman opens a Career Girls Shop and an Infants Shop—and incidentally, enjoys a great success with both. Sears switched its emphasis in the 1930s from mail-order to retail stores; now, without deemphasizing its stores, it is clearly putting vastly more muscle behind its mail-order and related telephone-order business. And, as we have just mentioned, most mass retailers are already involved in discount-type outlets or soon will be. So, to this extent, retailing has been flexible. But the question may properly be raised whether most retailers have been adequately flexible—or whether their grand strategy has not too often been a case of too little, too late. For example, the current deep interest of so many mass retailers in low-margin stores might better have come into evidence at least 5 years earlier. Certainly it was evident five years ago that lowmargin retail techniques would profoundly affect our most powerful retailers. Yet, even two years ago, several of the very giant retailers who announced discount store programs in the spring of 1962 were saying publicly that this concept was hardly worth paying attention to! In fact, a well-known department store executive, in a public speech, specifically said that it was the lethargy and the closed-mind of department stores and other mass retailers that held open an umbrella for the newer forms of low-margin operations. Also—Ike and Mike: Moreover, not only has flexibility among mass retailers in their grand strategy tended to be a case of too little, too late—but it could also be correctly charged that when grand strategy has been modified or changed, they have all tended to make almost precisely the same modifications or changes! Thus, up-to-date, the grand strategy changes of so many mass retailers consist almost entirely in moves not only into the discount operation—but into discount operations involving an Ike and Mike similarity. Between 1955 and 1960, our mass retailers all flocked toward the one-stop store concept with a remarkable (and discouraging) degree of unanimity and similarity. Ike and Mike were never more alike than the new one-stop store units of so many mass retailers opened during the last five years. Now the same thing is happening with respect to so many of their



latest discount type of store units. These stores have no identity, no point of departure, no difference, no image. Is it any wonder that so often the new store units of mass retailers now require two and three years before they operate in the black? And is it any wonder that Wall Street gives a low price-earnings ratio to the securities of so many giant retailers? After all, with store and store location obsolescence moving at such a fantastic pace that a five-year span may mark the peak of the profit potential for any number of new stores—and with two to three years now being required to turn the net profit corner on these new store units—the financial future can hardly be bright. No—flexibility in grand strategy cannot throw off an adequate return on investment when it revolves primarily around doing exactly what most major competitors are doing. In the early decades of the twentieth century, our present retail giants were created by merchants who had grand strategies that involved pioneering. Too few mass retailers are pioneering today. Flexible Flexibility: We believe that flexibility in mass retailing, as a grand strategical concept today, involves reaching out to the shopper not exclusively in the same ways as competition—but also in diverse ways that are different, daring, pioneering, and wise. For example, there are few mass retailers today who have been as flexible as Sears. This is why so few retailers have moved into mail-order until very recently (through tie-ups with such mail-order specialists as John Plain). This is why so few retailers have gone into auto tires, parts, and accessories as has Sears—or into gas and oil. This is why so few retailers have studied the potentials for new service departments as has Sears—and why even fewer have even begun to do anything about these departments although Sears is now moving rapidly into service areas. A flexible grand strategy for a retailer today might include such a variety of store types (plus the Sears variations just mentioned) as: 1. Various types and sizes of low-margin outlets, ranging from giant department store type of store units to small specialty store units. 2. Leased departments in various types of outlets.



3. Leasing out departments in some of the present store units. 4. Superluxury store units (an affluent society makes these types of stores particularly logical; why leave this market to the specialty shop owners?). 5. Warehouse types of stores—stores stripped of luxury fixtures, located in tertiary locations, etc. 6. In-home selling on a vastly expanded scale. 7. Experiments with departments in new types of outlets—the gas station, for example (a mail-order house is testing a catalog in gas stations). 8. The franchise operation is ripe for expansion. 9. Expansion of mail-order and telephone volume. 10. Opening specialty service stores—dry cleaning stores, for ex ample. 11. Expanding new service departments and bringing in leased department specialists to run them. 12. Opening specialty stores of various kinds—for example, chil dren's specialty stores, garden shops, tire and auto accessory shops. 13. Opening "fun centers" that would include bowling, miniature golf, swimming, kiddie facilities, dancing, club rooms, etc. 14. Further development of real estate activities. One of the big food supers which has a big real estate subsidiary is planning a huge housing development for one of its land holdings. 15. Acceleration of testing with automatic vendors, including the automatic vendors that provide such services as dry cleaning, etc. Sell Everything, Everywhere, Every Moment: Grand strategy for giant retailers should really involve selling everything, everywhere, every way, every moment (night and day, seven days a week). And "everything" includes services as well as merchandise, lowprice lines as well as luxury lines, pipe rack operations as well as gilded fixture operations, giant stores and bantam stores, department stores and specialty stores—everything, everywhere, every way, every moment. It will include mergers, affiliations, interlocking arrangements, holding corporations. It will include a broadening variety of nonmerchandising functions. It will include affiliations with some suppliers; it will include af-



filiations with some wholesalers. As a matter of fact, it will also include some interesting new corporate affiliations between some large retailers. For example, a large operator of millinery department concessions is exploring the possibilities inherent in forming a mutually owned corporation with a variety chain. It will make fuller use of electronic data processing, fuller use of the new marvels of communication. But over and above all, it will be the opposite of playing follow the master. It will include improvisation, pioneering. Pygmy Giants: What this means is that our present retail giants will, in time, look like Pygmies. We are coming into an era of $10 billion retailers, of more $5 billion retailers, of many more retailers with an annual volume of between $1 billion and $4 billion. They will achieve this volume by selling to the masses through every feasible mass technique and by selling to the upper classes of our affluent society through every specialty technique. They will be all things to all people all of the time, everywhere. And through this flexibility, the first few mass retailers to operate a grand strategy of this kind will achieve a unique image. Conclusion: Will this be the ultimate in mass retailing? Hardly. The fact is that the only permanent thing in business is change. But this could be a potent grand strategy, applied in programs of varying scope, by mass retailers of various sizes.
Next: 24-hour 7-day Mass Retailing

Next stop for mass retailing—a 24-hour day, 7 days a week! But this doesn't mean that the store units of mass retailers may as well throw away the front-door key (although some food supers proudly boast that they "never close"). What it means is that the shopper will be able to buy—from chain stores, department stores, etc.—7 days a week and 24 hours of each day. This will be done not by keeping stores open 168 hours weekly, but rather through: 1. Rearrangement of store hours—a process that is currently picking up momentum, with nocturnal hours taking over up to 60 per cent of total retail volume in many trading areas.



2. 3. 4. 5. 6.

Stepping up in-the-home selling. New techniques for selling by mail. Improved procedures for selling by telephone. Development of still newer concepts of retail locations. Extension of vending machine selling.

Full-time Shoppers—Full-time Retailing: Now, what we are saying is that more and more mass retailers will be intensifying their usage of all of these basic methods for reaching out to the shopper every solitary moment of the entire week. And the goal will be to make it convenient, attractive, desirable, for the shopper to order anything, at any moment of the day or night, any day of the week, from any one mass retailer. We even now see department and some chain stores stepping up their in-the-home selling—and increasing their night openings. We even now see some department and chain stores stepping up the technical and personnel efficiency of their telephone order boards. We even now see some chain stores, in particular, turning to vending machines in their windows, in parking lots, etc. And we even now see one or two chain stores putting vending machines into basements of huge apartment houses on a test basis. The Next Great Trend for Mass Retailing: But we have yet to see one mass retail organization concretely committed to a long-term program involving the intensive development of all of these various procedures for eliminating a single "dead" moment from its retail operation for every one of the 168 hours of the full week. And that is exactly, precisely, what we foresee as the next great move by a multiplying number of mass retailers. This is the next great trend for mass retailing. And it is premised on a very simple fact, to wit: Shopping demand never stops. It is only retail service that stops. Perpetual shopping demand calls for perpetual retailing! Proof That Shopping Never Stops: We see the truthfulness of the assertion that shopping demand never stops in such developments as:



1. Stores that never close their doors. 2. The amazing success of the 72-hour "Sellathon" in hard goods, etc. 3. The remarkable volume done on Sunday by various types of stores in various locations. 4. The simply gigantic jump in total retail volume done after 4:30 P.M.—in some trading areas up to 60 per cent of total retail. 5. The rush of many types of chain stores into the Christmas cata logs sponsored by the department stores. 6. The enormous growth of in-the-home selling—appliances, TV, home furnishings, soft goods, even food and drugs (not to mention cosmetics, greeting cards, housewares, etc., etc.) are being sold in rapidly expanding volume by big department stores and chains. (Total retail sold in the home in 1957 approximated five billion!) 7. The remarkable volume done by some vending machine instal lations in store windows when the store itself is closed. 8. The very interesting volume done on nonautomative volume by some gas stations, especially at night. 9. The plan of a big developer of shopping centers to make large vending machine installations in parking lots, etc., and another plan involving a portable store that can be put up and stocked in 24 hours in any temporary location. 10. The recent testing of new types of telephone order boards by several large stores and the testing of voice recorders as order takers (a development with vast potential promise). The telephone order board that never closes is undoubtedly on the way. Why Shoppers Want to Buy Any Moment of the Day or Night: The shopper isn't perverse in showing a growing desire to shop during any of the 24 hours, any one of the seven days of the week. The shopper's reasons for this attitude are simply explained—they line up about like this: First—with more married women working (the time is coming when we will have as many women, married and single, at work as men) a change in shopping hours as well as shopping locale is inevitable. Second—with brands so strongly presold, with family income so strong, people buy more impulsively, and they can become impulsive almost any moment of the day or night. Third—as working hours shorten, people stay up later at night.



This is an overlooked point; when the work day started at 7 A.M., the worker was in bed at 9 P.M. The later people stay up at night, the later they want to shop at night. Fourth—shopping is becoming less and less of a source of entertainment, more and more of a chore. We like to do chores mechanically, quickly, painlessly. This is one reason for shopping in the home. Fifth—husbands and wives share work, share home duties, share shopping. They can best share shopping at night—or in the home. Sixth—everybody has a phone today, and uses it. Telephone shopping will increase for all of the reasons already mentioned. Seventli—domestic help is scarce. Baby sitters are expensive. The family car is frequently gone all day because Pop uses it at work. Transportation sometimes is expensive as well as time consuming. Children can be a burden when shopping. All of these factors tend to encourage shopping at home, shopping from a catalog, shopping via the telephone, maybe shopping in the basements of large apartment houses. Eighth—when out for a ride, a family is easily tempted to "park and shop." And millions of families go for a ride, especially on week ends. One large shopping area reports over 5,000 visitors by car every Sunday just to gaze—only the drug store is open! Ninth—the more time people have for shopping, the more they want to devote the "least desirable" time for shopping. And, the less time in total they want to spend shopping. And the fewer shopping trips they want to make. All of this encourages buying at home from in-the-home salespeople, buying at home from catalogs, by telephone, etc. Tenth—we have more "emergency" shopping needs than ever before, by far. Catering to these emergency shopping needs is, indeed, becoming almost a form of retailing by itself. There are other factors at work to induce more millions to do more shopping more of the 168 hours of the week. And, of course, there are factors that the astute retail merchandiser can concoct and sell to shoppers, to the same end. How to Plan for 24-hour 7-day Mass Retailing: It is quite imperative for the retailer to approach full-time 168 hour a week retailing with a completely open mind. Established policies will not necessarily fit the new pattern. Neither will estab-



lished procedures. This will be a case of experiment and test, test and experiment. New merchandising procedures will be indicated. The merchandising requirements for mail-order, for telephone, for in-the-home selling (as well as for selling via vending machines in the window, etc.) can be quite different from on-the-floor merchandising. Ditto for buying procedures. Organizational charts will require changes. Executives will have to be put in charge of these new avenues for reaching out to the shopper; this cannot be a "spare time" project for a busy executive. Careful records will have to be kept—and the figures, not opinions based on habit or prejudice, will have to prevail.
The Accelerating Rate of Store Obsolescence

A retail store used to be "forever"—almost. Obsolescence was strictly a problem for manufacturers. Today, obsolescence (as applied to the total retail plant excluding inventory) is a serious problem. Tomorrow it may well become a critical problem—certainly the obsolescence rate for the total physical facilities involved in the mass retail function, and particularly in the retail store itself, is accelerating. Today, retail stores have an obsolescence rate (when locational obsolescence is included) that at least equals the obsolescence rate of many manufacturing plants. And, store fixtures may become obsolete at an even faster rate. Today, the amazingly rapid pace of locational change for retail stores produces an obsolescence factor of major dimensions (early shopping centers are now obsolete; highway locations may obsolete many other shopping centers, etc.). Manufacturers do not contend with this obsolescence factor to nearly the same degree. Today, new electronic communication techniques for retailing (including electronic tabulators, etc.) are compelling huge investments that will obsolete rapidly as this young science matures. Tomorrow—every facet of large-scale retailing will be affected by major developments that, if anything, will produce an obsolescence rate for the total plant of the mass retailer that will be



considerably higher than the obsolescence rate of most manufacturers! Has Retail Accounting of Obsolescence Lagged? Whether the accounting techniques of most retailers have made proper allowance to date for the current rate of depreciation m physical assets (as differentiated from inventory) is highly questionable. And whether the accounting techniques of most retailers have shown any hopeful indication of properly appraising the obsolescence factor for the next few years is even more of a question. Here is a fundamental situation for study by all top management executives as well as the store controller of retailers. That study involves such factors as: 1. The proper statement of the asset value of the physical proper ties of retailers (in at least some instances these may be consid erably overstated due to inadequate allowances for modern-day de preciation). 2. The proper statement of the capital position of the retailer— this, too, may be overstated because of improper allowance for ob solescence. This would be especially true of the working capital position. 3. The proper statement of profits and loss. 4. Proper depreciation deduction for taxes (maybe it's high time that the various associations of mass retailers united in a comprehen sive study of the modern-day obsolescence factor in mass retailing and then fought on a united front for a new attitude on the part of the Treasury Department). Why Is Obsolescence of the Retail Plant Speeding Up? There are many factors responsible for the acceleration of the obsolescence of the total retail plant involved in the operations of the mass retailer. Let's see what at least some of these factors are: 1. The current trend among all retailers is toward larger store units—even department stores are now committed to much larger branch units. These larger units tend to obsolete the older units at a much faster rate than would be true if the new units were the same size as the old. 2. The imperative need among retailers to use all available capital



resources in opening new store units in new locations—suburban and regional. This has made it difficult for many retailers to keep their downtown and neighborhood store units in the most modern condition—and a neglected store unit obviously depreciates at an ever-accelerating pace. 3. The trend among all large retailers toward more luxurious store units. This speeds up the obsolescence rate of the older units. More over, a luxury layout itself involves a higher obsolescence rate than a more staple layout. 4. Retailers originally made their own decisions concerning loca tion of new store units. But now, in many areas, the promotors of shopping centers have certain retailers "over a barrel." Sometimes leases are signed almost as much to keep out competition as to achieve profit-making sales figures. Naturally, such locations have a high obsolescence rate. 5. The public is more mobile than ever before in history. People move their homes at an unmatched pace. And they travel about daily at a remarkable pace. The ability of our people to cover more and more miles when shopping and the factors of population mobility have combined to create new shopping areas at a breath-taking rate, and to mark down older areas at an equally breath-taking rate. Obviously, this mobility of our total population is playing a direct role in the acceleration of store obsolescence. 6. Retailing was the last of the great economic trinity—manu facturing, wholesaling, retailing—to turn away from almost full de pendence on manual labor. Retailing is turning to the mechanical, to the electronic, in warehousing, in stock rooms, in floor operations, in communications, in transportation. The early stage of a revolu tion of this character is always more dynamic than the later stages. Consequently, the dawning day of the engineer in mass retailing means a still further acceleration of the obsolescence factor. 7. New architectural concepts are coming thick and fast in re tailing. (The store-in-the-round is getting some attention.) Here is a potent factor in giving the obsolescence rate another shove up. 8. As part of this architectural revolution in the retail store, fixturing is in a high state of flux. One large retailer claims that, from the day a blueprint of a new store is OK'd until that store is opened, over 25 per cent of the fixtures have become obsolete! Cer-



tainly changes in fixturing have come about in the last ten years at a rate that combined to produce a larger total of fixture changes than in the previous 30 years! This is accelerated obsolescence with a vengeance. 9. Vast social changes have occurred among the shopping public. Increases in our total population. Changes in income levels. Changes in size of family. Changes in home location. Changes in living habits. Changes in working habits—including the vast increases in women at work. Changes in the man's role in the home and conse quent changes in his shopping habits. Changes in the position of the teen-ager in our society. Changes involving nocturnal shopping, and now changes involving Sunday shopping. (Sunday shopping will favor the highway location, and this may tend to obsolete many present-day shopping centers, thus introducing still another obso lescence factor; and the Federal Government's gigantic road building program will play an enormous role in creating new store locations and obsoleting many old locations.) 10. The trend among all mass retailers toward an increase in the number of merchandise classifications stocked. This trend for all mass retailers to become new types of department stores clearly speeds up the obsolescence of older stores. 11. The parking situation and traffic congestion combine to ac celerate store obsolescence. Thus, many stores opened five years ago have inadequate parking areas today. Also, many shopping centers opened five years ago "out in the sticks" are now in congested locations with as many traffic problems as downtown. 12. Vast changes are sure to occur in railroad commuting and in passenger service. Within ten years, some big railroads will be en tirely out of passenger business. These changes will play havoc with some established home areas. Here, too, a direct impact will be made on store obsolescence. 13. New forms of transportation may be coming in—perhaps the helibus. The auto transformed the world of retailing. Maybe the helicopter and the vertical-rise plane will do the same to tomorrow's world of retailing. Here is a potent factor in obsolescence calcula tions. 14. Self-service today is essentially a manual operation. The next step is to make self-service mechanical (vending machines, etc.).



After that self-service will become electronic in certain aspects. Selfservice in its present form can no longer make a dramatic contribution to larger volume, lower costs. In new forms it may once again. These new forms of self-service will change store architecture, store layout, store fixturing to the same gigantic degree as self-service in its present form originally did. 15. Mass retailing must cut its payroll costs. It must learn how to meet new forms of low-margin competition. This will involve more than merchandising; it will involve new store concepts. Maybe the smaller store will eventually become popular again. What could that do to the obsolescence rate? Conclusion: The store obsolescence factor must be examined with a new attitude, with a new understanding of the impact of the present-day and near-term-future trends on store obsolescence. The whole capital position of retailing is involved in this major development—the acceleration of the obsolescence of the total retail plant. It's time that it got the top-drawer attention it demands.
Voice-command Shopping

Bell Laboratories have made it known that the future of the science of telephonic communication includes a dial telephone that will be operated by voice command. Apparently, laboratory models of such a device have been developed to a point where they represent considerably more than mere scientific curiosities. However, the fundamental scientific theories from which a voicecommand dial telephone will emerge are by no means limited in their potential application to telephone dialing. Research and development now in progress are directed toward voice-command-operated machines. To the scientific world, the voice-command machine, as a concept, is no longer considered to be in the stage of theoretical contemplation, but it is assumed to be at the stage of practical development. In brief, the voice-command machine, as a device, is beyond even the blueprint stage and is now in actual existence, if still being tested. That got us wondering about voice-command shopping! Oddly, shopping originally was voice-command. The shopper told



the clerk what she wanted—the clerk picked out the purchase as instructed. That was clearly voice-command shopping. But it was voice-command between two humans. Then, self-service practically eliminated the human voice in shopping. Now, we are faced with the probability that voice-command techniques, involving an oral command by the shopper directed to, and recorded by, and acted upon electronically by a machine, will bring back the human voice to shopping. The voice-command machine will be easier for the shopper to operate than some of the more complex button-pushing automatic vendors that have been predicted for the future.
Next Leap Forward in Self-service

The next great leap forward in self-service retailing must—and will—make it unnecessary for the shopper to cart purchases to a checkout point. This final step in the shopping process is a vestigial hang-over from centuries of retailing tradition. It is as old as retailing itself. In the ancient bazaars, the shopper handed her selection to the merchant. In more recent eras, the shopper relayed her wants to a clerk who brought them to the cash counter. In the modern era of self-service and self-selection, the shopper has really returned to a modernized version of the ancient bazaar—she collects her purchases and takes them to one of several types of checkouts. This traditional procedure must go—and it must go for a variety of reasons. These reasons include: 1. It is a major factor in both employe and shopper pilferage. Un der self-service, inventory shrinkage has become a serious factor. For every dollar pilfered by the shopper, at least $5 to $10 is pil fered by employes who frequently are in league with professional outsiders and with customers. So long as merchandise remains out on open display, so long as hundreds and thousands of people in the aisle may walk around with selections in their hands or in carts— just so long will the shrinkage rate continue to climb. But it cannot be permitted to climb much higher. 2. Shopper fatigue is a definite, concrete problem that bites deeply into the sickly average ticket in one-stop stores; it costs stores more than does both shopper and employe pilferage combined. But, be-



cause it is hidden beneath the surface, it has never been evaluated by retailers. 3. Shopping time is becoming increasingly limited. For the vast majority of purchases, shoppers make fewer shopping trips and are desperately eager to cut the total elapsed time for each shopping trip. Carting merchandise to a checkout point involves shopper time in collecting purchases, time in bringing purchases to the checkout and, of course, there is the fearful waste of shopper time at the checkout—especially during the vital peak hours. The less shopping time available, for these reasons, the smaller the shopper's purchases. Here, again, retailers who worry about shopper-employe pilferage would do better to worry about the "pilferage" of potential purchases directly traceable to the time the shopper wastes under the archaic present system. 4. The peak-hour problem is the gravest problem in mass retailing today. Yet, in scores of meetings of retailers held during the first quarter of 1962, we failed to note one session given over to a discus sion of this situation. Most large retailers account for 60% to 75% of the week's volume in from 12 to 20 hours of the week. What is more, the peak hours are becoming still fewer, still more sharply peaked. 5. Bringing inventory to floor shelves, stocking those shelves, and checking inventory on those shelves involves great retail costs. In the food super, for example, perhaps 25 per cent of total margin is consumed in this fashion. Clearly, if the floor inventory were to consist merely of samples not to be moved by the customer—if the floor inventory were to constitute a new type of merchandise show room—then this gigantic, and constantly growing cost monster would be just about totally eliminated at one stroke. 6. Out-of-stock conditions on the floor, as well as the equally seri ous condition involving inadequate or understocks on the floor, would also be eliminated. Every mass retailer knows that his losses from this source, if done away with, would add enormously to store vol ume and store profit. While there can be, and are, backroom and warehouse shortages, these in no way compare with floor shortages. Moreover, the former are more easily controllable. 7. Total selling floor area could be sharply reduced. This would cut the cost of new stores—currently a fearful problem.



8. Retailing must emerge into the era of electronic data processing. The point-of-sale recorder in particular, tied into electronic data processing in the backroom and at the warehouse, simply must be put to work in mass retailing. Without it, the cost of distribution cannot be sharply reduced. To date, this application of automation processes to retailing has been thwarted by the complications inherent in the process of shopper handling of merchandise. But, when sales are recorded automatically as the shopper moves from one shelf to another—then the first vital step toward electronic data processing for retailing will have been taken. This will be—this must be—the next great leap forward in self-service retailing. In any event, the carting of merchandise by the shopper to a checkout must go. It will go. And we earnestly believe the trend has just begun. This will usher in a new form of self-service. There is no doubt whatever that when this takes place, it will affect the marketing programs of manufacturers every bit as dramatically as did the present era of self-service retailing.
Rental Retailing Picks Up Steam

By the end of 1962, Sears Roebuck expects to have in operation, in no less than 200 of its stores, a rental service on sick-room needs. This will include rentals of wheel chairs, crutches, humidifiers, hospital beds, mattresses, and a wide range of similar items (all also offered in the Sears catalog on a regular resale basis). Sears is also testing rentals of garden equipment and certain other lines in some of its stores as part of its new emphasis on the retailing of services, as differentiated from the resale of merchandise. Another development—at least one department store is testing a car rental service. This could touch off a fascinating rental trend. Still another development—rental retailing has grown sufficiently to justify the formation of an association consisting of smaller retailers specializing in rental retailing. It's called the American Rental Association. Retail members of this association report a rapidly mounting rental volume on power tools, floor-care equipment, home furnishings, TV sets, flatwear, china, and glassware. Only a small handful of manufacturers are paying particular attention to the expanding rental market. But there is every reason to expect that there will come a time when a large number, and a



wide variety of manufacturers, will have a marketing-sales executive in charge of distribution through rental outlets. Certainly when a giant retailer like Sears plunges into a rental department (with the likelihood that, within three years, practically every one of its stores in the States will have a rental service, plus offering a rental service via the catalog), the potential must be huge. Montgomery Ward is believed to be experimenting with rentals. So are several of the variety chains, and some discount chains. Indeed, the discount chains may become leaders in rental retailing; their traffic is ideal for rental promotion. A few food supers have had a small rental service and more will be added. And bear in mind that the giant Hertz would hardly be experimenting with rental stores if it considered this business to have only peanut potentials. Many manufacturers will, in time, make special models, special designs, special price lines for the rental outlet. And, eventually, some manufacturers will be advertising the availability of their brands in rental outlets. Right now is the proper time for many manufacturers to study this rental market—to conduct actual experiments with it—to begin developing a program and an organization to capitalize on rentals. After all, if giant retailers are convinced a sizable potential exists in rentals and are willing to experiment with this market, can manufacturers afford to be less inclined to test rentals? Manufacturers tend to charge retailers with being laggards in testing new markets. This certainly has not been true with respect to the rental market. Only a few manufacturers (International Silver is one) have moved toward rental volume as energetically and as openmindedly as our giant retailers.
Next: The Unattended Retail Store

Do those several straws we see moving in the breeze point to a fascinating new development in retailing—the unattended retail store? We think so. And we propose to explain why we have come to this forecast—a forecast which, experience leaves no room for us to doubt, will be greeted with total incredulity, and even total hilarity in most marketing circles.



So for the incredulous, we should point out, at the outset, that we already have several forms of unattended retail stores. For example, the unattended automatic laundry and automatic dry cleaning store operates in many states. And these unattended, automatic cleaning stores retail not only service—but also include automatic vendors that vend a growing list of merchandise. For example, the unattended quick-lunch restaurant is making remarkably rapid progress. There are some filling stations offering self-service that are, basically, unattended. There are satellite branches of some banks that are unattended; indeed, for years many banks have offered an unattended night depository service. And there are unattended "newsstands" in several cities; some have been operating successfully for a number of years. We might also point out that the major part of telephone service is really unattended. Also, the check-in and baggage phases of Eastern Air Lines shuttle service to Boston and Washington are unattended. Elevators are unattended. The public is becoming conditioned to unattended facilities of a wide variety—and the fantastically growing era of automation guarantees that this trend will accelerate and will touch every phase of our lives. A wide variety of vending machine installations actually involve unattended retailing. These include automatic vendors operating outside retail stores, in store windows, at filling stations, in apartment basements, and in dozens of other locations. Indeed, the coming age of automatic vending will be one of the great forces that will push unattended retailing into high gear. On a vastly larger scale, the catalog-order stores operated by Sears and several other mail-order chains are very close to being unattended retail stores. Certainly, the personnel in these catalog stores is only a fraction of the personnel in traditional stores selling general merchandise in similar volume. What is more, the shopper who has had some experience in a catalog store soon does most of her catalog shopping "unattended." Come to think of it—mail-order retailing itself really was one of the original forms of unattended retailing. The shopper going over a catalog in the home is part of an unattended retailing operation and many billions of dollars' worth of merchandise of every conceivable description has been sold this unattended way. Similarly,



the shopper making up a mail order from newspaper or other advertising by a retailer is shopping unattended. Currently, a variety of stores are putting in catalogs. The catalogorder desks in many of these stores are unattended. Clearly, a vast amount of merchandise bought in discount outlets is purchased on an unattended basis. Ditto for most of the volume done by the food super. Even the variety chains and the drug chains, in their new self-service outlets, can trace the bulk of their volume to unattended shopping by the customer. What is more, in all of these outlets, the percentage of total volume done on an unattended basis—or on a so-called attended basis so utterly inefficient as to be tantamount to being unattended—is rising rapidly. But these outlets are not set up for modern electronic, unattended retailing—a point of vast importance. Another development that involves unattended retailing is based on the new concept under which the shopper will no longer take merchandise to a checkout point. A number of discount chains have operated some of their departments this way for some years. Now several other types of retailers are testing this technique, under which the floor stock consists only of samples. The customer records her purchases from these samples in several semi-automated ways. When she gets to the checkout, her purchases are ready for her and the total sales automatically recorded. This particular form of the unattended technique will mark the next new and great wave of discount retailing! There simply is less and less logic to the traditional process of compelling the shopper to cart self-selected merchandise to a checkout point. It is costly, time-wasting, and inefficient. It encourages shopper and employe pilferage and causes out-of-stocks, etc. Under this new technique of shopping from floor samples for everything from big-ticket appliances to food, from soft to hard goods, from drugs to toys—the unattended store becomes a practical reality. Throckmorton's remarkably successful hardware store in Dayton, Ohio, is an example. Here is the basically unattended basis on which this unique store operates: 1. The customer studies items wired to pegboard displays to make a selection and then picks an IBM card that corresponds to the item from a nearby rack.



2. The number and price on the merchandise correspond to a number and price on the card. 3. The customer takes the IBM cards, one for each item she wishes to purchase, to a cashier. The cashier's section houses six IBM machines. 4. One of these machines coupled with a cash drawer serves as a cash register. The cashier prints an invoice in triplicate, gives one copy to the customer, sends another through a blower to a stock boy, and keeps the third for tax records. 5. Unless the order is large, it usually has been made up and de livered to a nearby pickup window before the cash transaction is completed by the customer. Unattended retailing is the next logical extension of self-service retailing—and both are the logical extension of the presold brand. It now becomes feasible in this electronic, automatic vending age.
Next: Rooftop Retailing

We have penthouses on apartment house roofs. We park cars on the roofs of some commerical buildings. We will have a heliport on the new Pan-Am building in New York. We have apartment houses with swimming pools on the roof. Will we, some day, find retail stores adding a floor—by utilizing the roof area for retail merchandising—for actual shopper use? We think so. And, to make clear that this is not just a wild stretch of the imagination by one who does imagination-stretching, we want to mention promptly that in several West European cities, store roofs have been turned into shopping areas—and very successfully. We understand, also, that some of the large department stores in Japan have turned their rooftops into recreation centers for youngsters. The youngsters are supervised while their parents shop. One of the stores even has a small zoo on its roof. The engineering problems we leave to engineers. The architectural problems we leave to architects. But let us address ourselves to the merchandising situation involved in rooftop retailing. First—we have had a remarkable resurgence of outdoor retailing on the ground level over the last decade. Merchandise is being displayed—and sold—in areas outside the store. Merchandise is also being displayed and sold in the parking area.



There is not the slightest difference between offering merchandise for sale on a store's rooftop and offering it for sale in the parking lot, or in front of the store—other than elevation. AD of these areas are outdoor areas. And, with vertical transportation of shoppers now something of a science, bringing shoppers up to the roof, and down from the roof, surely presents no problems. As a matter of fact, in some downtown locations the rooftop may very well become the modern form of the old-time bargain basement. The bargain basement has been battered severely by discount competition. New ideas are being developed in attempts to breathe new life into this ancient institution. But, in the end, these new concepts really aren't very new at all. They tend to wind up simply as a downstairs type of discount operation—with self-service, checkouts, etc. But a bargain basement up on the roof could start off with truly new concepts. Even more important, however, would be the advantages that are inherent in a new retail location—and the rooftop would, obviously, constitute a new retail location. It is entirely possible that some older department store branches, built in the era in which department stores had concluded that suburbanites were all hugely affluent and would stay out of bargain basements in droves, and which consequently have no basement selling areas, may arrange for rooftop retailing in these store units, as well as in their downtown stores. Another development that points to the advisability of considering the roof as a logical retail area is the trend toward retail merchandising of such lines as boats, prefabricated homes, swimming pools, bulky items for the garden, home, etc. These space-demanding lines may benefit substantially from low-cost "found" space on the roofs of certain retail stores. We think, also, that the trend involving the use of the parking lot for merchandising and public relations programs may be overdone. At peak hours, parking lots tend to be overcrowded. Some retailers will, therefore, decide to transfer these programs up to the roof— including twist contests for teen-agers. And, as usually happens, manufacturers who work closely with their retail accounts in the development of fixtures for rooftop retailing, special departmental trims, special inventories for this location, special promotions, etc., will pick up a competitive lap.



Will Banks Become Merchandise Retailers?

About five years ago, we sent the great petroleum refineries into a tizzy by suggesting that they would soon be compelled to retail nonautomotive merchandise at the filling station. Today, practically every major refinery is committed to precisely this program. Now we are suggesting that many banks will eventually find it sound economics to distribute general merchandise in, or adjacent to, the bank building. We are sure that this suggestion will also send the banks into a tizzy. Yet, oddly, many of the selfsame circumstances that, in time, compelled the major refineries to take the plunge into nonautomotive merchandising at the filling station will also march many banks, step by step, no matter how reluctantly, into certain classifications of general merchandise retailing. In analyzing this potential development, it is necessary to start off by comprehending that, with the exception of a few great "wholesale" banks like Morgan-Guaranty, most of our banks are "retail" banks. They perform a retail function. Now, with that premise comprehended, let's proceed to examine the march of events that will compel many banks (commercial banks, savings banks, savings and loan institutions) to become retailers of merchandise and of nonbanking services: 1. The banks are now selling certain services not associated with the banking function. They are selling insurance in some instances; they are selling travel services in other instances. Certainly it is not a far cry from selling a travel service to selling merchandise: books on travel, passportholders, etc., for example. 2. Branch banks are now being opened in other types of retail outlets. In some states, there are branch banks in some food outlets and in some department stores. In Stamford, Connecticut, one of the banks has a branch in the railroad station. The First National Bank of Cleveland is testing branches in Standard Oil of Ohio gas stations. If a bank service can be properly merchandised in resale merchandise outlets, then why shouldn't the bank, itself, in its own building, or on its parking lot, sell certain resale merchandise? Is there anything any more sordidly commercial about selling mer chandise than about selling a banking function? 3. The gas station is now going into nonautomotive merchandise.



Every type of retailer is going into the merchandise classifications of every other type of retailer. Wherever there is traffic, merchandise can be sold. The public is always shopping—always. Banks have traffic. Why should banks turn away this traffic simply with the sale of a banking function? Gas stations are finally learning that they, too, have been wasting traffic. Our banks, in due time, will learn the same lesson. 4. A bank could make a very simple start with a vending machine. For example, why not a cigarette vending machine in a bank? It would be completely logical. 5. Why shouldn't banks sell books on business, on economics, on financial problems of the homeowner? Since some types of banks sell mortgages and home improvement loans, why not also sell books on home care and home maintenance? Of course the objection could be raised that a bank would not want to compete with its customers—in this case, its retail store customers—by offering for sale, on or adjacent to the bank premises, merchandise or services that are being offered for sale by its retail store customers. However, banks are now selling travel services— and certainly, travel agents are customers of banks. When a bank offers a premium to bring in new depositors—and at least one savings bank here in New York offers a variety of a half dozen premiums, some of them fairly big ticket items—it is also competing with its retail customers who may be selling these very items over the counter! (And when a filling station sells any kind of merchandise, it is competing with some of its customers, some of whom are also now servicing cars.) Since conceiving this admittedly startling idea, we came across a news item that seems to lend interesting verification to this prediction. This news report, which appeared in Home Furnishings Daily, is to the effect that the nation's largest bank, the Bank of America, is arranging with the White Front Stores to mail to the bank's credit-card mailing list of about 250,000 names in the Los Angeles area, a 48-page catalog, put out by the White Front Stores. The idea was tested with the mailing of a four-page brochure offering Polaroid Land cameras to Bankamericard credit-card holders. The bank handled the mailing. (White Front is a subsidiary of Interstate Department Stores.) This, very obviously, is one way in which a bank can go into the



merchandising of resale merchandise. With the largest bank in the nation showing an interest in selling merchandise, by one technique or another, directly or indirectly, the concept has clearly received mighty powerful support. Maybe someday Western Union will sell merchandise at its telegram counters—why not? Maybe the telephone companies will sell a few items in their telephone booths. We can't escape advertising, day or night, no matter where we turn. Ditto for the distribution of resale merchandise and services. Pepsi-Cola is cultivating barber shops and shoe-repair shops. Both of these retail forms are coming out of the dark ages of retail merchandising. The beauty shop, for several decades, was only a small step ahead of the barber shop as an outlet for resale merchandise. But here, too, the tide of change is in evidence. Even the shoe-repair shop is just beginning to emerge as a potential outlet for certain resale merchandise. So, too, is the bowling alley. All of these service retailers see that established mass retailers are moving into service areas. Sears has announced that the sale of services offers a more dynamic area for volume expansion than the sale of merchandise. Department stores, variety chains, food chains, drug chains are all adding new service departments, ranging from beauty shops, barber shops, and gas stations to shoe-repair shops, travel bureaus—and certain banking functions. Consequently, the retailers offering these services are concluding that they must get into general merchandise if they are to compete. The bank is a service retailer. We believe it will join the march of service retailers into merchandise retailing in logically limited areas.


64 Ways Science Will Help Move Merchandise

Scientists themselves have thrown away their traditional caution—and, with almost total abandon, predict that science will make greater progress in the next ten years than over the last full century! How will these fantastic achievements of science in the next decade reshape the movement of merchandise into consumption? Let's see—let's take a peek at not one, not two, not three, but a whole armful of coming retail revolutions—most of them destined to take place from 1965 to 1970. 1. A volume of $10 billion by at least one major retailer will have been achieved. Perhaps a half dozen retailers will have built a volume of be tween $3 billion and $5 billion. We will have almost as many billion-dollar retailers as billion-dollar manufacturers. New techniques for electronic communication and electronic control over vast distances will make these huge, far-flung retail empires entirely practical. 2. Science will make world-wide retailing feasible. 3. The helicopter or other vertical-rise planes will emerge as a new form of mass transit. This will push retailing out farther and farther, geo graphically speaking, not only from the city but also from the suburbs, because it will enable our people to live farther and farther out. The entire technique of short-haul transportation will be revolutionized—and, just as the auto revolutionized retailing, so will these new techniques of short-haul transportation change the face of retailing. 4. The manual handling of merchandise will be lessened enormously. A whole new science of electronic materials handling, specifically engi neered for the requirements of retailing and wholesaling, will have been perfected. Push buttons will replace muscle in the handling of merchan dise at every step of the distribution process. 5. The air transport of merchandise will have assumed proportions that can scarcely be conceived today. This will bring about great changes in inventory practices. 6. Inventory practices will also be revolutionized by instantaneous elec tronic control from the precise moment each sale is made. Systems similar to that under which each call is electronically tabulated by the telephone company will be adapted to retailing.



7. Stores of the future may tend to the "round." And some stores of the future may revolve—with the customer sitting in front of merchandise that is conveyed in front of him for push-button recording of purchases. 8. Self-service will have been extended to practically all categories of merchandise. The check-out counter will be in use in most types of stores. It will be electronic, however—the check-out girl will have disappeared. Merchandise will be electronically marked in code, electronically read at the check-out, electronically totaled, recorded, etc. In many cases, mer chandise will not be brought to the check-out—only a record of purchases will be made. 9. The moving sidewalk will bring vast changes. It will bring shoppers from parking lots to the store. It will be used inside the store as moving aisles (stores are already so big that shopper fatigue is becoming a prob lem) . It will make every floor (basements, too) a main floor. 10. The vending machine principle will have been extended to a broad range of merchandise. With atomic-radiated food freed from spoilage problems, food will be sold in mounting volume from electronically con trolled batteries of vending machines. Ditto for innumerable other small items. 11. Certain categories of merchandise will arrive at the retail store on their own shelves or fixtures. Merchandise will be price-marked with electronic devices—the cost of price-marking will be slashed. 12. The electronic conveyor for merchandise will be performing mir acles in every stage of the distribution function. 13. Closed-circuit television will be used to instruct store managers, floor personnel, warehouse personnel, etc. Headquarters will be able to "see" every step of the distribution process through electronic eyes. 14. The shoplifter problem will be solved by electronic eyes. 15. Store window displays will be "installed" by the use of screens on which setups are flashed from a central closed-circuit TV control room. 16. The private-wire telegraph-telephone network systems now so broadly used in industry will be broadly used in retailing and wholesaling. 17. Some shopping will be done electronically from the car—the car will pull up to a huge electronic bulletin board on which merchandise will be featured; remote controls in the car will permit the shopper to record her purchases. This will be electronic drive-in shopping. 18. Electronic store directories will help shoppers find their way around the huge stores of the future. 19. Parking lots will become multistoried, especially downtown. Cars will be parked automatically. Shoppers will be conveyed by moving side walks to the retail store. 20. Downtown areas will have hit high gear in their rehabilitation of



the core of the city. Billion-dollar plans for the modernization of downtown will be common. Downtown will become a new type of shopping center—with all the latest electronic devices. 21. The manual handling of "paper" in retail control work will be vastly reduced. 22. The electronic recording of telephone orders will surely become common—and telephone ordering on a 24-hour basis will be common place. 23. Store hours will have been shortened—perhaps to 40 store-open hours a week. Morning openings will be rather rare. Over half of total retail volume will be done in most categories at night. And the new types of vending machines will make 24-hour retailing a practicality in certain classifications. 24. Electronic systems will make it more practical for more stores to develop practical mail-order systems. 25. Selling in the home will have become a much more important fac tor—and will be controlled from headquarters by electronic communica tions. 26. The concept of "continuous flow," now universal among modern manufacturers, will take over the mass distribution function. 27. The peak in diversification of inventory by category will have been reached by 1965—and a strong reverse trend toward new types of oneman or even unmanned small specialty stores will be in evidence. 28. The gasoline station will have emerged as a new form of retailing for many nonautomotive items. 29. Batteries of vending machines will be dispensing many items in huge new apartment houses. 30. Electronic techniques may make it possible for reserve stock per sonnel to "see" the shelf inventory at all times, and thus rush fill-ins in plenty of time. Out-of-stock should be reduced to a minimum. 31. Much of retailing's "paper" work may be handled by huge elec tronic control centers serving a number of retailers. 32. In very large stores, the shopper may be moved about by small individual busses—these may very well be the "shopping cart'' of the future. 33. Walkie-talkie communication in warehouses, retail stores, and of fices will be common. 34. The telephone company is working on vocal dialing. This should be perfected by 1965. From the vocal dialing of a telephone number to the vocal recording of retail orders by the shopper is not a great jump. 35. Shopping expeditions will be less frequent; this trend is very much in evidence right now.



36. In all merchandise categories, the presold brand will be even more dominant than it is today. 37. The store-controlled brand and the wholesaler-controlled brand will assume much greater importance and will be strongly presold. Giant retailing will inevitably tend toward own-brand exploitation. The great brand battle of 1965 will be between manufacturers' brands on the one hand and retailer-wholesaler brands on the other hand. 38. In certain categories, manufacturers will short-cut their route to the retailer—this means the elimination of the middleman in a few cate gories. Also, as retailers develop their own brands, manufacturers in some lines may feel forced into the operation of their own retail stores—espe cially as retailing becomes increasingly an electronic proposition. 39. Prepricing, preticketing, and prepackaging will be well-nigh uni versal. 40. Trips to market may be revolutionized. In some classifications, the retail buyer may be able to "go to market" via the television screen (in color). This may revolutionize trade shows, etc. 41. The obsolescence rate of not only the retail store itself but also of all of the retail office, warehouse, etc., will have been greatly accelerated. This will affect the whole basic concept of retail accounting practice. 42. Margins in many merchandise categories will have been reduced. This will prod retailers into ever-newer techniques for low-cost retailing. 43. The full-line trend among manufacturers will compel retailers to develop their own policies of strength vis-a-vis the giant manufacturers. 44. The peak periods of retailing each week will become still more peaked. 45. Store personnel ratio to volume will be cut considerably. 46. Turnover rates will be accelerated. 47. Retail net-profit percentages will be reduced; but volume will be greater. 48. Our universities will be instructing students in electronic retailing precisely as they now instruct students in industrial applications of elec tronics. Retailing will be able to attract a better type of executive per sonnel because the retail function will be on much the same level as the manufacturing function. 49. Retailing will achieve a vastly improved knowledge of the shopper —facts will supplant much of retailing's present-day guesswork, opinion, and old-wives' tales with respect to the shopper. And retailing will know much more about market potentials—it will look ahead rather than back to last year's figures. 50. Retailing will have developed new techniques for testing and intro ducing the torrent of new products that will be hitting the market.



51. The frozen-food cabinet will disappear from the food store. Ir radiated food, bombarded by atomic particles, will require no refrigera tion. This will change not only retail floor selling practices but will alter radically many of the traditional steps involved in getting food from the processor to the wholesale warehouse, to the retail warehouse, to the re tail floor. Inventory practices, which are now controlled on certain foods —delivery practices, too—by problems of preservation, will change com pletely as preservation becomes less of a problem or is totally eliminated. (Maybe certain drugs now requiring refrigeration will also be irradiated.) 52. The automatic recording of the shopper's buying decisions must be accompanied by mechanical and electronic devices for recording sales by totals, by classifications, by item, brand, etc. (Department stores are making progress here.) A big step in this direction will be the electronic check-out counter. 53. With the electronic check-out counter, merchandise will be marked in a code (automatically) that can be picked up by an electronic scanner. This will actuate electronic computers and other devices which will not only instantaneously record the shopper's total purchases—but which will also instantaneously record sales, inventories, etc., etc. Some of these devices are appearing right now. 54. The moving sidewalk will permit vastly larger parking lots, since the customer will not have to walk from car to store, or from store to car. It will also facilitate the movement of purchases from store to pick-up station or to car. The moving sidewalk will permit larger shopping centers —the shopper will not have to walk from store to store. It will become a moving aisle inside the store—the shopper will be transported from sec tion to section. It is entirely possible that the moving aisle will include fix tures into which the shopper will place her purchases, thus eliminating the shopping cart. Moreover, a small electronic computer on each one of these moving-aisle-connected fixtures could very well automatically tote up all purchases—thus eliminating the bottleneck of the check-out counter. 55. The moving sidewalk or moving aisle concept will also make feasible the use of multistore buildings for the food outlets and other single-story mass outlets. These moving aisles can move up or down with the same ease that they move horizontally. This will permit stores, in sections where ground costs are high, to be as large in square footage as those outlets located in less costly areas. 56. The electronic conveyor will bring merchandise from the truck to the warehouse, from the warehouse back to the truck, from the truck to the various stock areas within the store. Today, most inventory is handled manually. The enormous cost of manual handling of merchandise in a



high-wage era simply can no longer be tolerated. (The food store right now probably handles 10 tons of merchandise for every ton it actually moves into consumption. This will be cut back to a ratio of perhaps three to one by electronic techniques and by new means of transportation, packaging, fixturing, etc. It will also be cut by electronic conveyors.) 57. Remarkably new techniques for catching shoplifters will be de veloped. Closed-circuit TV is right now being used for this purpose; so are gamma ray detectors. Unquestionably, atomic radiation offers unique methods for detecting shoplifters—devices will pick up impulses from packages that have been suitably treated. This is important because shop lifting is becoming professionalized. 58. The new techniques for electronically recording every step of the buying transaction will also sharply cut losses that are now due to errors —intentional and otherwise—at the check-out point and other forms of internal or employee pilferage. 59. Closed-circuit TV will enable headquarters actually to "look in" on the floor of any store unit—see what is going on. It will also enable head quarters to "look in" on various internal departments of each store unit. Some, if not most, of the present-day field forces will be done away with— headquarters control will be via the electronic eye. 60. Also through closed-circuit TV, it will be possible to flash promo tions from headquarters, not merely to each store, but actually to "set up" these promotions within each store automatically and instantaneously. Sound impossible? It's being done at this very moment. It is entirely probable that there will also be small screens placed within the various shelving areas that will sell—with sight, sound, and color—as the shop per's hand is reaching out for merchandise. 61. Intercom systems will have a much broader use in distribution outlets. Right now, inventories are being taken with the aid of walkie-talkie systems. Once it is possible to have the human voice actuate electronic recording systems—as Bell Telephone is endeavoring to do right now with the oral type of dial system—then inventory will be recorded by voice, instantaneously. Communications between the store selling floor and the reserve stock areas with the offices, receiving points, warehouses, etc., will be enormously improved. 62. Vending machines will be given a voice. Recording devices right now enable the vending machine to "talk back." One such device now instructs the short-change artist to fork up more money! And the vending machine, too, can incorporate a closed-circuit TV screen that will do some fascinating selling. And now we propose discussing in detail two vast technological developments that will profoundly affect the movement of merchandise:



63. No more "bad weather" explanations: Is the time coming when retailing will no longer be able to fall back on its time-honored explanation for failure to meet planned figures—to wit: 'The weather was against us"? Twill be a sad day—but it's surely a-coming. A new "weatherless" era for retailing is dawning. It will take three great basic forms: A. The total retail area—including entire shopping centers, entire downtown areas, entire parking areas—will be weather-protected and air conditioned year round. B. The automobile and all mass transportation vehicles will be air conditioned, fog conditioned, and better able to travel safely in snow and ice with new techniques including radar. C. Weather predicting is finally to become a true science, thanks to electronic techniques including the electronic computer—and actual con trol of the weather, over considerable areas, will come in time. Let's analyze each of these three vast developments, with their enormous implications for mass retailing—and when one bears in mind what science has achieved over the last five years, surely there are few executives who will today take the position that "it can't be done."
A. Weather-protected Shopping Areas:

The store units of most mass retailers are air conditioned right now. But too few stores have efficient year-round temperature-humidity control. Many factories have achieved absolutely perfect year-round temperature-humidity control (dust control, too). These techniques must be adapted to the total retail function, including of course, the selling floor. This will come rapidly. However, much more will be done to free the shopper from the vagaries and vicissitudes of the weather. For example: (1) The total parking area must be made as free from temperature, humidity, snow, ice, mist, etc., as is the store interior. Every winter, thousands of shoppers have accidents in the parking lots due to snow and ice—and millions stay home to avoid those accidents. Consequently, the next step in the parking lot must be to put it under a roof—and also to provide temperature-humidity control in the roofed parking area. (Step ping into a car parked in the summer sun for several hours is horrible tor ture.) (2) The shopper must be brought by air-conditioned vehicle from the parking area to the store. And, if she walks, she must walk in weatherprotected comfort from the car to the store—and back again. (3) Walking from one store to another must be free from all problems of weather. This means that the total shopping area must be roofed in and provided with year-round air conditioning—as has already been done in several shopping centers.



(4) In general, every inch of the shopping way will be free from any problem of weather. There are too many torturous shopping inches right now.
B. Air-conditioned Transportation:

There is little question that both the individual car and all means of mass transportation will be air conditioned within a few years. This means that the shopper will travel in comfort from home to store—which is another good reason why the total retail area must be weather protected. It should also be pointed out that more and more homes will be air conditioned year round. So, with home and transportation having yearround air conditioning, the total shopping area must provide the same comforts. And it will! Moreover, not only will highways be made more free from the hazards of weather'—right now the great new highways clearly are made more free from weather problems than the older highways—but great new scientific progress will be made in a very few years in this phase of transportation. Car radar is entirely probable. Today, millions travel by car in weather that would have kept them at home just twenty years ago. Within the next five years, millions will travel by car and by mass transportation in weather that keeps them home today! In brief, the hazards of weather are to be considerably lessened with respect to individual and mass transportation. This obviously means that bad weather will tend, less and less, to "keep 'em home."
C. Weather Prediction:

The art of weather prediction is now destined to become a science. This is a development of enormous potentialities. Already, short-term and long-term weather predictions are considerably more accurate than they were a short decade ago. But this is nothing when compared to the scientific progress that will be made in weather prediction within the next very few years. The electronic computer, the giant electronic brain, will permit completing enormously complicated mathematical computations in minutes that now require days. Moreover, these electronic brains will come up with their own weather predictions—the automation weather man is very much on the way. Consequently, the retail merchandiser can look forward to a time—and it is not far distant—when he will be able to plan with less fear of unexpected foul weather fouling him up. (The new problem will be to determine the new extent to which bad weather may be ignored by the shopper —due to better highways, better cars, better parking facilities, etc.)



But the truly great development that may come about within ten years —and bear in mind that interplanetary travel was "science fiction" for most business men just ten years ago—will be the forthcoming control of the weather over large geographical areas. This potentiality is very much in the top-drawer stage in our program of defense planning. It may very well be that the first nation to develop weather control may have a weapon of attack more fearful than the hydrogen bomb, or poison gas, or bacteriological warfare. We cite this point merely to emphasize that weather control is the subject of military study—which means that it is receiving millions of dollars for what is almost "crash" scientific research. It will surely be achieved— perhaps imperfectly in its early days, but with a mounting degree of control as time rushes on. 64. "No season" era? Will seasons ever be entirely eliminated by science? Probably not. But it is certain that science will achieve growing control over seasons. And that development will mean enormous changes for those responsible for the movement of merchandise into consumption. As a matter of fact, changes in public attitude toward the seasons—and toward the purchase of seasonal merchandise—have come about so gradually over the last few decades as to appear in proper perspective only when one takes a long backward look. Too many executives view the seasons historically, instead of viewing present and future trends. It is difficult to believe that, even in the 1920s, the majority of men donned "long Johns" in early fall. It was only as recent as the early 1950s that men's year-round suiting fabrics turned to considerably lighter weights. Yet, despite the traditional reluctance of men to accept change, men's suitings have gone through a revolution in a single decade—a revolution of weights and fiber. It still startles some observers to note that women's swim suits are now sold in respectable volume in months that, only a few years ago, marked the total disappearance of swim suits from retail floor inventory. And, of course, the willingness of the auto owner to drive his car year round startles those old timers (circa the early 1930s) who remember when most cars were put into dead storage not long after Labor Day. The seasons no longer rule completely. The public's attentiveness to the seasons was just about absolute at the turn of the century. These seasonal habits were deep-seated both because of deep instincts and because of habits formed over many generations, backed by folklore. It required an increasing degree of public sophistication to accept the premise that our lives need not be ruled by the seasons. There is reason to believe, for example, that if air conditioning had been introduced at the turn of the century, it would have met fierce resistance. Indeed, it met



considerable opposition in its early years. Almost everyone exposed to airconditioned public places in those years could "prove" that colds, rheumatic and arthritic aches, and other ailments too horrible to contemplate were directly traceable to exposure to air conditioning. (Today, it is just about impossible to get a competent secretary unless one can offer air-conditioned offices! As for shoppers—the retail store today must be air conditioned. The public is now more ready than ever before in the history of modern civilization to accept the basic premise that the seasons need no longer rule its living or buying habits. This willingness to give decreasing concern to the seasons will expand with each passing year. Not only that, but more and more of our people will demand greater freedom from the seasons, greater opportunity to buy and use merchandise that spreads out the seasons, greater opportunity to shop under conditions that make climate less and less of a consideration. And, of course, fast travel over big distances by more and more millions compels vast "out-ofseason" purchases.


37 /Master Strokes That

Move Merchandise

No Monopolies in Merchandising

Every so often it appears as though a new form of retailing is about to shove all established retailers into oblivion. Most executives will remember when the mail-order houses appeared to pose the threat. Then it was the chain stores. More recently it was the discount house. Today, some merchants wonder if the house-to-house "peddlers" will take over. But there never has been such a thing as a monopoly in type of retail service. The chances are there never will be. Department stores presumably were going to be put out of business by every one of the major developments of the last several decades. Yet they remain a powerful retail outlet. The drug outlet has been complaining in recent years because the food outlet has added health and beauty aids, not to mention many other classifications inventoried by the druggist. Yet the drug outlet continues to survive. The food outlet is currently concerned about discount house competition. But the discount houses are hardly likely to take over the business of food retailing. Giant retailers become larger, ever larger. Yet the small independents somehow survive as well as they ever did. (The mortality rate among small retailers has been high for generations.) Survival is assured by only one thing—the willingness and ability to change to conform with the public's new ideas, new wants. Change! As department stores changed by developing branches. Change! As the variety chain changed by becoming a new type of department store. Change! As the independent druggist changed by going self-service, by becoming more of a merchandiser, by capitalizing the new wonder drugs. Change—any business operation that did not change more in the last five years than in the previous ten has, very likely, taken a step backward. And any retail operation that does not change twice as significantly in the next five years as it did over the last five years will, perhaps, be taking two steps backward. The pace of change in moving merchandise is accelerating. Retailing is



a dynamic industry—supercharged with the dynamism that is an integral part of change. In such a situation there can be no monopoly—there can be only new and greater opportunities for those who keep a step ahead of the changing requirements of changing times.
Cuffing Store Hours to 50 Hours Weekly

Why do established retailers tend to perpetuate so many store hours that shoppers have clearly indicated they can just as well do without? The answer, of course, is competition. But those shopping centers where total store-open hours are more sensibly regulated prove that, if retailers can't get together voluntarily, they can get together on store hours under the leadership of the owners of shopping centers. Inasmuch as the major part of total retail volume will soon be done by retailers located in shopping centers of various types—the means exists for retailers to begin to exercise some degree of control through shopping center management over the uneconomic runaway in the weekly total of store-open hours. It is interesting to note that in several foreign nations, weekly store-open hours are regulated either by law or by concerted retail action. This includes one day a week in some nations during which stores are closed completely. (In New Zealand, all stores are closed all day on Saturday!) And these nations do not have night hours or Sunday retailing! In connection with cutting store hours, it is vital to bear in mind that, in a number of shopping centers, as much as 60 per cent of the weekly total volume is done at night. Bear in mind that fully half of this nation's total retail volume is right now done at night! Bear in mind that this trend to nocturnal retailing will continue—and Sunday retailing, too. And now—consider some such schedules as: 1. All stores to open at noon—particularly on days when stores are open at night. 2. The ultimate object—to eliminate morning hours as completely as possible. 3. One day a week when all stores are closed. Eventually, stores may be compelled to close at least one day each week if Sunday openings should become common. 4. Several days each week when stores do not open until 1 P . M. or 2 P. M. 5. Shorter store hours on Saturday, especially in those areas where Saturday has become a poor retail day. 6. Experiment with evening hours. Perhaps an hour could be taken off evening hours one day or two days a week. Maybe a limit should be put on the number of evenings stores are open—when evening openings reach



a total of five, and surely when they reach a total of six, the law of diminishing returns has probably been reached. Sunday retailing may lessen the need for five and six night openings. The near-term object of retailing, with respect to store-open hours, must be to bring the weekly total down to a maximum of 50 hours. Inasmuch as fully half of this nation's total retail volume will soon be done in from 15 to 20 hours of the week, and since most of these 15 to 20 hours will be evening hours (plus some Sunday hours perhaps) that 50-hour objective should not be entirely beyond possibility. We emphasize the importance of experimental schedules because it will do little good to attempt research that asks the shopper in effect: "What hours do you want us to remain open, day by day?" The unfortunate truth is that shoppers' answers to that type of research are almost entirely without significance. The shopper just doesn't know what hourly and daily schedule will appeal to her most—until a schedule is made available to her. Then, by her shopping action, she registers her vote—which then becomes a vastly more meaningful vote than a vote based on a vague opinion. It is vital to bear this in mind since many retailers attempted to question shoppers about evening hours some years back—and, in many instances, were steered away from nocturnal schedules because so many shoppers indicated that night hours would have little appeal to them. But when the night hours were made available, shoppers made it abundantly plain, by shopping action, that they would shop in profitable numbers and volume at night once nocturnal hours were presented to them.
Shoppers Who Shop for "Ideas"

One of the great department stores estimates that—in its furniture departments—no less than six out of every ten shoppers are really shopping for ideas. At maximum, only four out of ten are actually ready to make a purchase. Now there is no way to determine what percentage of the traffic in any department or in any store is shopping for "ideas." Certainly in fashion and "big-ticket" departments the percentage is high. In departments selling staples, or low-ticket items, the percentage shopping for ideas tends to be low. However, this much is sure: One of the fundamental objectives of all merchandisers must be, really, a twin objective: 1. Provide the shopper with ideas, ideas, ideas. 2. Plan so the shopper who gets an idea will immediately translate that idea into an actual purchase. This is a somewhat new concept in modern merchandising—and it is just taking hold. In other words, retailers have become aware that prob-



ably the majority of the traffic in their aisles is really looking for "ideas." As a consequence, they are beginning to display merchandise as "ideas"; ideas that will tend to impel the shopper to say "Now that's the very idea I was looking for." In foods, the shopper may be looking for "ideas" involving recipes, new menus, or new types of food; in cosmetics, for "coloring" ideas. In ready-to-wear, the feminine shopper in particular is obviously always looking for fashion ideas (which is one reason why some ready-to-wear merchants are using more and more manikins). In home furnishings of every description the shopper is looking for ideas involving current trends in decor, color, etc. This is one reason why several merchants are now arranging for "guided tours" of their model rooms—clearly a "guided tour" can give the shopper many ideas, give the shopper much more self-confidence. (And the shopper who gets an idea in the merits of which she has confidence has gone a long way toward making a purchase.) Take a look at the traffic in various stores. Note how the shoppers are, to an astonishing degree, shopping for ideas. Then ask: "Am I merchandising in a way to give the maximum number of shoppers the maximum number of sales-making ideas? And then, having given them ideas, am I doing the most effective job of cutting down the time lag between implanting an idea and making the sale?"
The Decimal Point Curtain

Add to the iron curtain, the bamboo curtain, and the paper curtain— the decimal point curtain. What is the decimal point curtain as applied to retailing? It's simply the slavish adherence to arbitrarily established, arbitrarily enforced, and blindishly applied percentages at the control level of retail operations. Adherence to decimal point policies in retailing dictates that: 1. A specific percentage of gross profit must be made. 2. Realistic markdowns are not taken if the department has already achieved a percentage performance. 3. During sales events, markdowns are taken on merchandise that could be sold at full markup. 4. Markups are made with a slide rule rather than on the basis of what the customer will pay. The modern executive understands that the true retail function involves an ability to determine the real value of an item or a line—and to set retail accordingly. Moreover, the modem executive is increasingly concentrating on gross dollar—rather than so strictly on percentage mark-on. What this really means is that there is a return to the retailer's original role of functioning as a merchant—rather than as a percentage calculating



machine. It means that automatic pricing is becoming less popular; and it means, too, that the retailer is taking the position that in his market he should be the one to determine pricing. It is fairly obvious that the most dynamic increases in gross volume— without sacrifice of the net percentage—have been achieved by the new group of low-margin merchants who disregard the old decimal point goals. As a matter of blunt fact, this new group of merchants winds up with a better net percentage than many, if not most, of our traditional merchants. Too many retailers have tried to make pricing a science. It isn't a science; it will never be a science, subject to slide-rule control. Pricing is an art—in which the practitioner feels his way, senses his way, experiments constantly. It can also be said, with correctness, that the art of pricing can seldom, if ever, be astutely developed from a desk. Pricing starts, as well as ends, on the retail floor. Unfortunately, too much of the time of those who control both policy and practice with respect to pricing is spent in offices. Too little is spent on the retail floor. There's been a great deal said about retailing being the gentle art of having the right merchandise at the right time, at the right price. The first two legs of that three-legged stool are not too difficult to keep in order. But the third leg tends to be the weak leg.
Automation Evils in Pricing

Price lining was one of the great merchandising discoveries. But—as with any basic business function—the rule-of-thumb application of price-lining traditions can play havoc with markup. Price lining is not a yardstick. It doesn't make possible "automation" techniques in pricing. There are innumerable instances where a few extra pennies will not restrain the turnover of merchandise. But the automatic marking procedures of some buyers and merchandise people—the premarking of invoices without even looking at the goods—tends to freeze markup to a figure that has remained stationary while all costs have gone up, up, up. Too many merchandisers are victims of price-line-itus. Too many merchandisers are captives of price-lining traditions. Too many merchandisers consequently overlook values—because they concentrate on historic price lining. The bald fact is that in many, if not most, instances, price lines are only vaguely comprehended by the shopping public. This is proved when one just stops to consider that competing stores, right next to each other, will very often merchandise different price lines—yet the same shoppers will shop in both stores!



Smart merchandising doesn't stop with smart buying. Indeed, smart merchandising just begins with smart buying. Truly smart merchandising includes pricing decisions that will move the merchandise in satisfactory volume—that will uphold basic store policy—that will enable the store to be competitive—that will give the customer honest value. In this connection, it would be an object lesson for many merchandisers to attend some of the so-called "auction" sales which are held throughout the country out on the highways. Note the prices that the shopper herself puts on merchandise—and then ask: How sacred are price lines? The essence of modern merchandising is elasticity. Competition moves too fast these days to follow principles blindly. It is the application of elastic thinking to soundly developed principles that makes a business operation truly competitive. Every incoming shipment of merchandise demands a new look in this matter of pricing. And it demands a new look that requires individual thinking—not robot thinking. Price marking must ultimately go automatic. But price-line determination and pricing in general must be a matter of individual determination. The freezing of markup due to slavish homage to pricing points is one of the serious drains on net profit. It's time to free merchandising from the shackles of automatic pricing.
Step Up Multiple Sales

The food super—which has sparked more than one new merchandising trend—is now going all out to increase multiple sales of many nonfood as well as food items. This trend started with the "banding" of various items —now it is spreading with amazing rapidity to the multiunit take-home or tote-home pack. (This tote-home pack has gone from Coca-Cola to beer to baby food, dog food, other canned foods, to innumerable nonfood items, etc.) The multiple-sales principle has been sadly neglected, however, in most of the soft-goods field. Only a tiny percentage of hosiery is sold in units of two—and even a tinier percentage in units of three, though it comes packed this way. Yet, clearly, for most women the purchase of a single pair of hose far from satisfies their hosiery needs. IN foundation garments—how often does the buyer of a corset also buy a bra or other related item? In shoes—the sale of two pairs to a shopper is really rare. Yet millions of women have from four pairs to a dozen and more pairs of shoes of various types. In millinery—how many sales slips show sales in multiple units? In dresses—ditto.



It's been said time and time and time again that the best prospect for more volume is the customer in the store. And there are few more profitable sales than the sale of a second, third, and fourth unit to the same customer. How does a merchandiser go about stepping up multiple sales? Well, the food super is as good a model as any; and this is how this dynamic merchandiser steps up multiple sales: 1. It finds out the shoppers' consumption or usage habits. This is im portant—because, clearly, the shopper will not buy in multiple units un less the way she and her family use the item make this a sensible thing to do. 2. It packs the multiple unit attractively. This is a vital factor—smart packaging is of enormous importance in multiple selling. 3. It displays the multiple unit forcefully. This may mean special fix tures, special locations (including "outposts"). It may mean special sign ing. 4. It develops a pricing point that suggests "savings" or "economy" to the shopper. 5. It stages periodic promotions on multiple units. To all of this, add the selling power of salespeople. This means training salespeople in the art of multiple selling. It may also mean special incentives for salespeople to encourage them to make more multiple sales. It may mean window displays of the multiple unit and effective newspaper advertising. Yes—multiple units offer multiple volume-profit opportunities.
Do You Know America's Greatest Retail Business?

The greatest retail business in this nation is the business that walks out of every store, every department, every section, every day, unsold. In some hard-goods and home furnishings stores, only from 20 to 30 per cent of the traffic in the store at any time make a purchase. And of those who buy, only half buy as much as they could be sold that day. In some soft-goods stores—varying department by department—only from 30 to 50 per cent of the traffic makes a purchase, and, of these, only half buy as much as they could be sold that day. Yet the public wants to do less and less "shopping around." Why then does the "half* walk out, the "quarter" walk out? And, as shoppers concentrate their buying trips into fewer and fewer hours each week, with resultant jamming up of retail aisles during these peak hours, why do the walk-outs and the "half" walk-outs and the "quarter" walk-outs multiply? There is not the slightest doubt that almost any retail store and almost any department or section could add at least 10 per cent to its total dollar



gross, and at least several points to its net-profit percentage, if it could snare more of our greatest retail business—the business that walks out every day, unsold. How to do it? Clearly, there is no grand and easy solution to this grave problem—no easy road to this path leading to more volume, greater net profit. But there are broad areas that every executive might explore. They include: 1. A fierce resolve to reduce out-of-stock and understock, especially of the best selling numbers, colors, etc. 2. Fixturing that encourages more preselection, more self-selection, more self-service—for every type of merchandise; no exceptions. 3. Better signing, signs that inform, signs that sell. Ditto for tags, ditto for demonstrations, etc. 4. Improved procedures for cutting down the time per transaction, especially the time required to complete the transaction after the pur chase is made. The more time per transaction, the fewer purchasers per customer because shopping time is always too short. 5. Fewer but better salespeople—and plans that enable these better salespeople to spend more time selling, less time writing up orders, mak ing change, wrapping, etc.
Eternal Vigilance—the Rx for Stock Shortages

No system has ever been developed that will automatically control stock shortages. There is only one prescription for stock shortages—and that prescription is simply eternal vigilance. Of course, stock shortages divide, in cause, between honest errors and a combination of pilferage and dishonesty. The ratio seems to be somewhere around 50-50 between the two basic causes. Both causes, however, can be lessened by. 1. A program for thoroughly educating everybody involved in the (a) seriousness of stock shortages and (b) the store system designed to cope with it. 2. That program will include, of course, the method of inventory— proper bookkeeping—proper protection of merchandise. 3. Then there must be periodic refresher courses—this is vital. Systems tend to wither unless they are regularly nourished by refresher courses. 4. Any departments or sections showing excessive shortages must be given special study—and the cause must be found. There is always a cause for excessive shortages. A red light, figuratively speaking, must flash automatically whenever the figures show excessive shortages—and it must be kept flashing so long as the shortage continues. 5. Incentives might be considered to help achieve new lows in stock



shortages—a competition between departments, so arranged that everybody involved has an equal chance to win, can achieve a great deal. 6. Publicity, properly handled—that is, publicity within the store— can also make a big contribution to the correction of stock shortages. 7. Friendly wagers between departmental heads have been known to bring about astonishing improvement in the stock shortage situation. 8. Since causes of shortages will vary by departments, a list of the traditional causes of shortages, specially compiled for each department and section, will furnish a check list that can save considerable time and money. 9. Awards for the best suggestions for preventing stock shortages could produce some excellent ideas. 10. One store used a "complaint" system with excellent results—em ployees on the floor, in receiving, marking, etc., were asked to com plain, in writing, on the theme: "How Can I Control Stock Shortages When ________ ?" This brought to light a host of small causes of stock shortages which, in total, mounted up to a respectable volume. System, imagination, incentive—and above all, eternal vigilance—will bring stock shortages nearer to that irreducible minimum.
Working on Wives at Work

Do you know, even roughly, what percentage of shoppers are married women who work? You know, of course, that among the young marrieds, from 50 to 80 per cent of the young women work. You know that among the more mature married women, the percentage who work will run from 25 to 40 per cent. And you know that these married women who work have innumerable merchandise wants—indeed, one reason many of them work is in order to fatten the family income sufficiently to enable the family to get the things it needs. And you know, also, that because they work their requirements are usually greater than if they were at home. We are not talking here about the so-called "career" girl. Actually, the total number of honest-to-goodness career girls is tiny; they have probably been given promotional attention out of all ratio to their shopping importance. No—we are talking about women of various ages, but particularly young married women ranging from 18 to about 25 years of age, who continue at work for various reasons. They are enormously important customers in every section of large stores. What do retailers do, specifically, to attract them? One store presents each woman who works with a special shopping



card, at the time she opens her charge account. This card reads: "This customer is a 'woman who works'—please give her particularly prompt service." While this card is given to all women who work, it obviously is particularly appreciated by married women at work. There are other little services that can be developed. For example, if the married worker wants her husband to approve a contemplated purchase—make it easier for this to be done. When wife and husband shop together—and this is increasing all the time, especially at night—why not let the working wife know how she is catered to during daytime hours? Why not an occasional promotion directed specifically at wives at work? And why not an occasional ad paying tribute to these wives at work— these women who double and triple in brass and who, in many instances, work as hard and put in as many hours as did any pioneer woman? As a matter of fact, retail store people should be particularly understanding and sympathetic with respect to wives at work—because so many store people are themselves wives at work! Check your own problems, your own feelings, your own requirements—ask yourself what you would like a store to do to make shopping for married women workers faster, more pleasant, less prone to annoying time-consuming errors, etc. Then put that kind of program into effect—and watch volume with wives at work promptly work its way up to new highs!
Plugging the Return-goods Leak

The shopper is, admittedly, responsible for a sizable percentage of total returns. The supplier is also responsible for a sizable percentage of total returns. But the largest part of total returns is directly attributable to the salesperson. And a substantial percentage of these returns stem from lack of knowledge. Any large store that could eliminate returns could add from 20 to 60 per cent to its net profit! But, since that calls for perfection by all involved in the process of selling and buying, from manufacturer to shopper, returns will never be eliminated. Perfection simply doesn't exist on this earth. Returns due to salesperson error, however, can be lessened. And here are some specific suggestions to that end: 1. Analyze all returns. Determine, insofar as possible, the real reasons. Where the salesperson is involved, follow through from that point. 2. Draw up a list of the most common reasons for returns. Put them on paper. Display a copy where each salesperson can see it frequently throughout the day. 3. Offer a small prize for the best record on returns by salespeople. Re peat the offer periodically.



4. Give special instruction to the salespeople with the highest returns. 5. Talk to some shoppers making returns—there's a lot to learn by getting closer to the customer. 6. Put up a thermometer spotlighting the return figures week by week. 7. Have the salesgirl with the best record on returns tell the other salespeople how she does it. 8. Tackle just one of the basic causes of returns each week—drill sales people, weekly, on the one selected cause. Then check to see whether re turns from this one cause tend to fall off. Keep hammering away at this one cause until you see progress. One point at a time will mean faster progress. 9. Check returns on employee purchases. This can be a most revealing study. See whether employees return merchandise for the same reasons as customers. You may learn a good deal about returns in this way. Make progress a step at a time, provide incentives, publicize achievements, and the return percentage will go down. 30-70 Is Hurting Profits For years, many types of retailers—including giants, medium-sized retailers, and smaller merchants—have found that some 30 per cent of the inventory produces about 70 per cent of the dollar volume. Moreover, sometimes that 30 per cent produces as much as 85 per cent of the net profit. Now only a starry-eyed theorist would conclude that 70 per cent of the inventory should produce 70 per cent of the volume. That would be nice—but it will rarely happen in the practical world of retailing. However, there is little doubt that unless this part of the inventory situation is checked periodically, it will tend to become still more lopsided. This was bad enough before the days of the discount house. But the modern discount house keeps its inventory narrow and not too deep. Incidentally, when the food supers started in the 1930s, they too kept a lean inventory. But today their motto is—no customer walks out of our store because she can't get what she wants. As a result, even in the food super we find that the 30-70 rule holds true today. Yet when a discount house opens a food department, it runs that department with a minimum inventory, the way food supers started out 30 years ago—and they enjoy a whale of a volume. Check inventory, therefore, not merely for sleepers, not merely for dogs, but for items and even lines that were put in actually because "a good customer" wanted it. That "good customer" could be the least profitable customer in a store!



Teacher's pets are not recommended in classrooms. They don't belong in retailing, either! It is because of this very tendency to carry whatever any customer ever even inquired about that so many merchants have store-wide turns of only two or three times a year when the rate should be double that figure. The highest possible gross dollar volume obtained with the minimum of inventory and a maximum turnover rate remains the very essence of merchandising net profit. Some of our largest retailers have discovered that volume, alone, can't achieve a satisfactory net—department store chains, for example, have shown volume gains in recent years, but their return on investment and net-profit ratio has tended to be dismal It is still turnover that is trump.
"It's New" Is Still Magic

If every shopper in store aisles were forcefully exposed by dramatic display to at least one new item— If just some salespeople were to suggest one new item—just one—to every shopper— But why be "iffy"? Why not exploit the magic that is inherent in new merchandise to make that extra sale? New items constitute news. Newsworthy items have built-in turnover. And, what is most important, new items usually permit a better margin —are less subject to fierce price competition. Yet, in so many stores, new inventory seldom gets top-priority treatment. Look around almost any store—how many of the exciting new items that were put into stock over the last month were: 1. Given choice display position? 2. Clearly and excitingly labeled "new"? 3. Given eye-catching merchandise displays? 4. Given special fixturing? 5. And, above all, how often were these new items called to the atten tion of customers by salespeople? If a retailer can score 100 per cent on that little test, then his net-profit showing will prove it. Indeed, if a merchant scores only 50 per cent on that test, he'll be doing well. But why not test that test? Why not make an eyeball study of the store right now? Walk in through the front door—see for yourself how many new items catch the eye because of display position, signing, display, fixturing. Then ask how many of these new items would catch the eye of the typical shopper. Then do one more thing—arrange for a few friends to "shop" the store



and report the new items they spotted. Most important, have them repor whether salespeople talked up a new item—and, if so, how effectively. A store's total performance can usually be measured by the job it is doing with new merchandise. Here is the great opportunity for the extrs sale—the more profitable sale. And here is the great opportunity to gel over to customers that a store brings them the mostest in the newest, That's a good reputation to build! "But We Might Have a Call for It" Right now—at this very moment—many, if not most, retail inventories could benefit from a realistic pruning of assortments. But this move toward a faster-turning inventory can never be achieved so long as managers approve the continued appearance of an item in inventory because "We might have a call for it." Yet it is both amazing and discouraging to note how frequently this "reason" is the sole circumstance explaining the continued retention of an item in stock. These numbers for which "we might have a call" are, in truth, merchandise oddballs. They clog up inventory, tie up money, slow down turnover, and slow down net profit even more than turnover. Ships accumulate barnacles. So do inventories! But ships are put in dry dock every year or so to have the barnacles scraped off. Unfortunately, a department's inventory is rarely sent to dry dock for barnacle removal. Tradition, habit, and that fear of being unable to satisfy the oddball shopper are at the bottom of so many topheavy, lopsided inventories. And to make matters worse, as a direct result of inventory investments in slow movers, funds are sometimes not available to keep a balanced inventory in the fast movers. That, in turn, means that regular shoppers are turned away, become "walk-outs" because a mythical shopper may make a call for an almost dead item. Inventories in outlets other than high-prestige specialty stores were never intended to provide 100 per cent service to 100 per cent of the shoppers. Mass outlets must stock mass inventories, and this means, essentially, inventories that will satisfy perhaps 85 to 90 per cent of the shoppers. Any attempt to appeal to the handful of fussy shoppers can only result in needless duplicity, overlapping that fouls up the inventory position, that slows down turnover, and that actually confuses customers because they are exposed to a jumble of duplicated brands and lines. Mass outlets must aim for inventories that are concentrated, inventories that represent narrow assortments of sure-fire sellers which are stocked in depth. As things stand now, too often a department is out of half the items on half of the excessive lines stocked—which, if anything,



is more annoying to customers than saying "We don't carry that, but we do have such-and-so, which is really better because. . . ." Planning inventories "because we might have a call for it" is the sure formula for poor performance. Plan inventories "because we have regular calls for it"—and you'll satisfy more of your customers more of the time.
Dissecting the Night-prowling Shopper

Most executives are startled when they are told that perhaps 50 per cent of our total retail volume is being done after 4:30 P.M. Total it up— food, drug, auto, appliances—from 30 to 60 per cent of the week's volume in these major lines is done after 4:30 P.M. In their branches in particular, department stores account for 30 to 40 per cent of the week's volume at night. Etc., etc. The night-beat customer may be the same as the daytime customer. But she buys differently. And she buys different things. What's more, she is usually accompanied by her husband; frequently by the entire family. Pop has more of a buying voice at night; so does the teen-ager. And buying is done with breath-taking speed. There are other differences in the nocturnal customer. Her average purchase is apt to be larger. The buying decision is made more quickly— usually because Pop and the family are right there: no need to "come back later." There's less shopping at night—more buying. We could add to this list, but, obviously, the nighttime shopper differs by location, by type of store, and by a store's nocturnal promotional activities, etc. Consequently, it is vitally necessary these days—we mean these nights! —to do some night prowling on the store floor. There is, really, only one truly enlightening way to study the nocturnal customer, and that is by watching her, listening to her, talking to her—at night! The bald fact is that few stores know the nocturnal customer well enough to plan for her specifically. Most store buying, merchandising, promotion, and planning is done with the daytime customer in mind. This is the way it has been done for years, and habit is hard to break. Much the same was true of most stores when they went out to the shopping centers. Then it was discovered that the suburban customer buys differently. Today, the better stores all merchandise specifically to the requirements of the customers of each store by location, rather than by rote or by habit. But the same procedure has not been broadly applied to the nocturnal shopper. She tends to get the same program as the daytime shopper. And this is usually as wrong as trying to sell the shopping center customer the same inventory stocked downtown. Join the night beat. Get out in the aisles—at night. And get out in the



parking lot at night, too, because as customers walk to the store and walk back to the car they talk; and what they talk about may help to sell more more profitably at night.
Needed: Bigger Average Tickets

There are, really, few reasonably successful stores that suffer from lack of traffic. What is more, promotions aimed primarily at increasing traffic pull in higher traffic counts, usually, only at extremely high cost. No, the major problem in retailing is not the traffic count; the major problem is the average ticket. The average ticket has moved up too slowly (particularly after allowing for rising prices and higher price lines). More over, when the diversification of inventory is weighed (more classifications assortments, etc.) the average ticket in ratio to inventory has at best just held its own. In every section, in every department, in every classification, the big problem in modern retailing is how to sell more to the traffic in the store. not how to pull more traffic into the store. Here is a check list of some things executives should study in order to achieve a higher average ticket: 1. Since most retail volume is done in a few peak hours, study traffic jams, bottlenecks in the department. The customer who can't get near the merchandise, or who waits too long to complete the transaction, will never buy as much as she could be sold. 2. Study the related display of merchandise. Effective display of re lated items, effective coordination of style items, methods of cross refer ence and cross selling, easing the customer's path from one section to a related section, "roving" salespeople, display suggestions—these and other steps can be taken to do a better job of suggesting related items. 3. Promote the credit system more dramatically, more constantly, to in-store traffic. Credit availability is one of the great techniques for induc ing customers to buy more. Remind, remind, remind traffic about credit. 4. Do a better job with the store directory. Most directories are incom plete, too few are displayed, and too many customers are sent on wild goose chases by uninformed salespeople. Identify even small sections boldly. 5. Effective signing can induce more shoppers to cover larger areas of the store. Too much in-store traffic never covers more than 15 to 25 per cent of the store area. 6. Provide facilities to help shoppers tote their purchases around the store. The shopper's arms may be full long before her purse is empty. 7. Under self-service and self-selection, trying to find small items in particular can be tough. Try it yourself sometime in a strange department.



8. Finally, shop all departments every spare moment. "Make like" a customer, see what discourages you from buying more, then apply the remedy.
Rev Up Time per Completion of Transaction

1. Shoppers want to shop faster, faster, ever faster. 2. The faster shoppers buy—the faster the cost per transaction goes down. Time costs money! So here is one of the real rarities in retailing—a demand on the part of the shopper, and a need on the part of the mass retailer that are mutual. Yet every observation points to the conclusion that: 1. While large retailers have enabled and encouraged the customer to make a buying decision faster— 2. The time involved in actually completing the transaction is almost at an all-time high in too many mass outlets. In too many stores of mass retailers—and the food supers, with their long lines at the check-out are no less guilty than other merchants— careful studies show that: 1. It still takes too long to pay for the purchase. 2. It still takes too long to have the purchase wrapped. 3. It still takes too long to get the purchase out to the car. 4. It even takes too long in some parking lots to get started homeward. All of which is decidedly aggravating to the shopper. The customer is fully aware of the undeniable fact that she is saving at the spigot and wasting at the bung. She knows too well that by her own efforts—that is, by self-service and self-selection shopping—she is cutting the time per selection. And she naturally resents the time she is then compelled to waste in completing the buying transaction. It would profit any retailer to make a "time-motion" study of what the shopper goes through in completing the transaction. Use a stop watch. Use a camera. And check the following: 1. The various store units, if it is a multiple operation. Be sure to get a truly representative "sampling" of all outlets. 2. The various departments—again making certain to get a truly repre sentative "sampling." 3. Seasonal peaks, by days, by hours. 4. The cash point. 5. The wrapping point. 6. Getting out to the car or to public transit And, while you are at it—check the time involved when the customer has made a buying decision and is looking for a salesperson or attendant to do what is necessary to complete the transaction. Check the time also



that is involved when the customer has made a partial or preliminary buying decision but wants just a bit of information before finalizing the decision. In brief, just as in the factory years ago the time-motion experts drew up complete lists of every motion involved in production—so what we an suggesting is that retailers should draw up a list of every motion through which the shopper goes whenever she wants to complete a buying transaction. Then study those motions, step by step, under every conceive able condition of time, place, merchandise category, etc. In particular, study what happens to the shopper's time—and store time—in the peak hours. There is every reason to believe that at least one reason fully half of the shoppers in a store during peak hours make no purchase at all—and the other half buy only half as much as they could be sold—is that in those peak hours the shopper simply cannot complete the buying transaction! There is little question that if more shoppers could more easily and more quickly complete the buying transaction during peal hours, stores could add from 10 to 15 per cent to their volume through this one procedure alone!
Take a New Look at Your Old Neighbors

As we walked down Main Street of a Connecticut city of about 80,000 population, we were struck with the changes that had been made in some of the stores since we had last checked this retail area almost two years ago. And that gave us a thought: We were quite surprised, for example, to note that the several variety chains on Main Street now offered a mower repair service, free alterations on men's suits, a catalog service, at-home telephone selling, floral arrangement sections, and repair and delivery on major appliances. One of the variety chains was selling monkeys and honey bears at $100 retail and men's suits at $79.50. Shades of Frank Woolworth! In established retail areas, changes tend to come slowly. Indeed, they may come so slowly as to be almost invisible to local merchants. It is only when one revisits a retail area after a lapse of a year or two that the retail changes stand out starkly and sharply. To most of the local merchants, the area tends to appear just about the same as it has been for years and years. Getting back to our experience on Main Street in that Connecticut city, we mentioned to one of the retailers that the street had changed quite a bit. He was obviously mystified by our observation. To him, Main Street was just about the same as it had been two, three, five years ago. We suggested to that merchant that it would profit him to maintain a little monthly record of the business changes among the retail stores on Main Street. We referred not only to new stores opening up, old stores



going out of business—but even more importantly to the improvements made in the established stores: new store fronts, new fixtures, new services, new lines stocked, store expansions, etc. In a year, we suggested, this monthly inventory of changes among his retail neighbors would amount to quite an impressive total. And then, we said, compare this living record of progress on your Main Street with progress in your own store. Are you lagging behind? Merely keeping abreast? Or are you staying ahead? Such a frank appraisal can be disturbing. But it can also be rewarding. Retailing has never changed so rapidly as in the last decade. In the present decade it will change even more rapidly. So take a new—and a continuing—look at your retail neighbors. It may help you to pick up a competitive lap now, and that's not nearly so costly as trying to regain a lost lap later on.
A New Order for Reorders

In a report made by the National Retail Merchants Association this statement appears: "It is strange but true that the average buyer is usually out of his best reorder items . . . the average buyer usually neglects to reorder these items fast enough, or in large enough quantities, to maintain steady peak sales of the best sellers." We deliberately identified the source of that statement because everybody in retailing knows that resources have wailed, gnashed their teeth, pulled their hair, have thrown fits—because reorders don't come in promptly enough and seldom are large enough. But the resource has his own kettle of fish to cook—and the reordering he would like store people to do will seldom come about in this workaday world. However, when the N.R.M.A., based on conclusions obtained from store operating heads, makes such a flat statement regarding the pretty deplorable reorder situation—then it must be pretty deplorable! And indeed so it is. The blame for this situation doesn't always rest with the buyer. Neither does it always rest with the merchandise executives. Store systems— store policies—play their role in fouling up reorders. But without attempting to pin the blame anywhere, what can be done to improve the reorder situation? Basically, reordering will be done more efficiently when the unit control system is intelligently used to: (1) determine the rate of sale, (2) know constantly the inventory, (3) maintain a balanced stock, (4) spot reorder items, (5) spot slow movers, (6) spot both up-fashions and down-fashions, (7) determine consumer demand, (8) discover sales by classifications of merchandise, (9) discover best resources, (10) check dollar planning, (11) check inventory shortages, and (12) determine open-to-buy by items or units.



Effective stock control places that information before the right store people. But nothing is more useless than statistics that are not prompt analyzed, intelligently appraised, and immediately acted upon. In most retail organizations there is no dearth of facts. But there is some times weakness in ferreting out the true story the facts tell, determining the proper course of action, and then taking action. No control system can make decisions. No control system can take the place of brains, determination, courage, action. A system is only as good as the individual who uses it. It's better t evaluate smartly and act upon decisively a minimum of information than to flounder in a lot of information that is seldom used. There is critical need for a new order in reordering. And the time is now "Our" Customers It is common practice for store executives to refer to "our" customers. And, equally commonly, the store executive takes the position that hi has a precise picture of "our" customers—whether he is talking about customers of the store as a whole, or shoppers in a specific department o section. But more often than otherwise this presumably vividly clear picture o: "our typical shopper" is really quite foggy. Often, it is imperfect, inac curate—and sometimes, as the lawyers would put it, it is immaterial, irrele vant, and incompetent. That typical customer, so neatly impaled on a pin stuck up on an exhibition board, too frequently is more tradition than fact, more historical than present day, more a creature of habit of thought than a creature of deep thought. Practically any store, practically any department or section that gears its operation to very much the same basic type of customer as it did even five years ago—and certainly ten years ago—simply is operating in a world of fantasy, of illusion. This nation's shoppers have gone through a total revolution in the last decade—and a big part of that revolution has occurred during the last five years. What is more, shoppers will change even more rapidly in the next five years than during any previous five-year slot in retail history. That is why one of the country's most exclusive women's shops opened a department for career girls—an amazing change for a store that catered to the 400. That is why one of Chicago's great prestige department stores now stages warehouse sales. That is why food supers now inventory exotic foods—ant eggs and such. That is why the variety chains now inventory mink. There is only one permanent thing in merchandising—change.



And it is evident on every hand that the shopper tends to change her spots more rapidly than does retailing. Yet, if the retailer is to continue to function as the shopper's purchasing agent, it is imperative that retail executives refrain from indulging in tie costly luxury of "standpatism." Any retail executive who has been wedded to exactly the same typical or average shopper in his store or department for more than a very few years would do well to think in terms of a divorce! Too often, when a merchant says "For years we've been catering to the same type of shopper"—what he really is saying is that "Our policies attract the same type of shopper." This must mean, in turn, that he is merchandising to the short end of the stick; and that end is getting shorter and shorter. That is because shoppers with new habits, new generations of shoppers, always outnumber shoppers with fixed habits. Thus a merchant who continues aiming too long at a shopper species that is declining, eventually finds himself with a declining volume. So touch up that picture of "our" customer and never stop. Change marches on. How Much to 'Torture" the Shopper Some giant retail businesses have been built in recent years on the still novel premise that sizable segments of the shopping public will not only accept a certain amount of "torture" when shopping, but will even welcome it (provided that these shoppers are persuaded they are getting values). For example, in many discount houses, the floor procedure is definitely not calculated to make heavenly the shopper's buying transaction. To the contrary, the shopper is subjected to a certain amount of "torture"—right there on the floor—yet these stores are thronged. (Incidentally, the "torture" that shoppers not merely put up with but seem actually to enjoy in some discount stores is almost incredible.) Similarly, the willingness of the shopper to tote huge packages out to a car that is not always within a few feet of the store door, cram those huge packages into the car, push and tug to get it out of the car when arriving at home, push and tug to get it into the home and set up—all this, too, frequently borders on the incredible. In many of the cash retail operations, the willingness of the shopper to draw large amounts of cash out of the bank, tote it to the store, and risk losing it also challenges belief. In some self-service outlets where neither carts nor baskets are provided, the shopper performs amazing feats of juggling and toting in order to accumulate multiple purchases—and does it quite cheerfully. A variety chain reports that it has excellent results selling room-sized rugs in the lower price ranges. Somehow, the shopper gets them home.



Ditto for great volumes of major appliances. Ditto for furniture. And ditto for every conceivable category of merchandise. Why, even when Mom gets home from a food-shopping expedition, she may have to make no less than six trips up and down from the upstairs kitchen to the downstairs garage to get the food purchases out of the car and into the freezer or pantry. She'll take that same car (so will Pop) rather than walk a block, but she'll climb a total of six floors quite cheerfully and so will Pop (albeit somewhat less cheerfully) to get purchases in the home. What does it all prove? Well, it all goes to prove that there is scarcely any limit to what millions will not merely put up with but actually willingly accept—so long as there is a promise of value, and so long as there is some degree of excitement, of doing, of saving time. We've yet to see a shopper walk out with a piano on his back, but ever since two men pilfered a canoe from a department store in broad daylight, we've been on the lookout for the shopper turned piano mover! Seen any around?
Too Much Timidity about Higher Price Lines

The financial ability of millions of our shoppers to buy higher, and still higher price lines has moved far ahead of the merchandising of higher price lines. We are coming into an age of luxury, an age of the super deluxe, of the custom-built, of gold trimmings. The public's financial assets make this possible, and its growing sophistication makes it still more probable. And much the same public that flocks to low-margin stores for low-end lines will flock to other stores for higherpriced lines. It is interesting to note that a number of manufacturers, in classifications as far ranging as woven floor coverings and housewares, domestics and apparel, have brought out special exclusive, custom-made numbers priced at high pricing points. One of the notable examples is so-called gourmet ware—the turnover in these high-price-line numbers of housewares is mounting with remarkable rapidity; yet housewares in general are being price slashed right and left. Even the food super—what with price specials and trading stamps and premiums—is doing a fantastic job with gourmet foods! Some departments that have done a particularly intelligent job with higher price lines have been able to step up the net-profit ratio substantially. Moreover, in several of these departments, the higher price lines are actually contributing a major part of the total net profit, although in dollar volume their total is not big. This does not suggest that a department should be turned over, lock, stock, and barrel, to higher-priced lines. After all, both the store and the department must be competitive. But it does suggest that executives might very well experiment more



with higher price lines. A bit more of the courage shown in pricing for the Christmas season may work wonders both during other seasonal events, and throughout the year. (Year-round gift buying, one of the great merchandising trends of the year, plays a role here as well as larger public income and more public sophistication.) Even in many staple lines, new markets are being created in much higher pricing points. And in other merchandise classifications, special designs, special constructions, special packages are providing opportunities for ever higher pricing points. There is no question—no question at all—that by 1965, a look back to the years between 1960 and 1965 will make it vividly clear that stepped-up price lining had been one of the greatest contributors to retail net-profit ratios. Instead of waiting for that backward look, why not look ahead and improve net-profit showing with an improved job of merchandising higher, and still higher price lines? Barnacle Brands Practically every retail operation tends to accumulate duplicating brands —like a ship accumulates barnacles. It happens for many reasons—competitive pressures, the lure of special deals, etc. At this very moment, in most stores, shoppers are faced with a larger number of competitive brands than ever before. Now it is self-evident that the shopper can be faced with so many brands that are quite similar in appearance, in price, etc., as to become confused, unhappy, and even somewhat annoyed. This is particularly true under the prevailing conditions of self-service and self-selection shopping. With less salesperson guidance, with merchandise simply out on open and uniform display, with too little printed selling, an inventory showing too many duplicating brands can become a disservice to the majority of shoppers rather than a service. Too many competing brands slow down the shopper, and the one thing the shopper wants to do is to shop faster. And of course anything that slows down the shopper slows down inventory turnover. This suggests two basic courses of action to executives: 1. Arrange for periodic house cleaning of brands. Retailers tend to ac cumulate brands almost without being aware of it. 2. Practice brand concentration rather than brand scatteration in mer chandising and promotional activities. In each category there should be one, two, or three brands which your figures and your long-term objectives clearly show to be your best bets. Give these brands special merchandising attention—and give them special promotional emphasis. Those two policies really work together. The more a merchant concentrates on one or several well-selected brands in his merchandising and



promotional work, the more obvious will it become that the weaker brands should be dropped. Simultaneously, it is wise to check back into the circumstances that led to the inventorying of the poorer brands in order to avoid these same errors in the future. Nobody can have every brand every customer wants. And bear in mind that customers will shop elsewhere—even if a merchant has every conceivable and inconceivable brand. Trying to get 100 per cent of the shopper's purchases by having every brand is just too costly—and the goal is impossible to reach. And over all, remember that in this self-selection shopping age it is the interrupting note that stops the shopper—you'll achieve that best by selecting worthwhile brands for special merchandising emphasis.
How to Get Better Housekeeping

Better housekeeping in a retail store involves not merely cleanliness, not merely orderliness, but also improved displays, better balanced inventories, etc. Everything that gives a department a stronger sales appeal really comes under the heading of "better housekeeping." But let's face it—the problem of achieving better housekeeping was never more difficult to lick than it is today. As a matter of fact, the old-time frontal approach just can't be used; it won't work—and it will usually tear down rather than build up. But if better housekeeping is made a game, and if the game includes an incentive, then at least some aspects of store housekeeping may show an improvement. One such program that can be adapted by many stores and departments operated as follows: (1) A list of the specific aspects of housekeeping to be included in the event was drawn up. (2) A quota of points was assigned to each of these facets of housekeeping. (3) The entire program, instead of being given such a humdrum theme as "housekeeping," was themed: "Sales Appeal Award." Thus, cleanliness was rated at 30 per cent, merchandise arrangement—30 per cent, stock in drawers or cases—15 per cent, adjacent stockroom appearance—10 per cent, etc. (4) Then 12 inspection teams were appointed. The members of these teams were actually drawn from top management—even the store president was included, as well as other management executives, divisional merchandise managers, etc. (5) These teams were scheduled to check— unannounced—each section in the store. (6) Each section was to be checked by two different executives, at two different times, and their scores were averaged. (7) A full week was set aside for the event. (8) The event was covered in the employees' bulletin, in locker room posters, with the paychecks, etc. (9) The prizes were made particularly attrac-



tive—both cash and certificates. (10) Daily postings were made during the event. (11) Winners were invited to lunch with management to receive their prizes and certificates. (12) Their photographs were sent to the local newspapers—and were used. (13) Throughout the entire event, good humor was employed—cartoons, sketches, publicity, posters, everything was keyed to fun. And then, to cap the event, special "Sales Appeal Awards" were given to those departments, and department heads, with the best showing. Does this solve the housekeeping problem? No it doesn't. But it helps. Do the improved results continue? Not forever—but some of the progress is retained. Store housekeeping tends to be at an all-time low. An event such as this one can at least pick it up out of the subcellar and bring it up, even if only temporarily, to a respectable level. Then if the event is repeated at logical intervals, steady and consistent improvement may materialize.
Making Friends among Supplier Salesmen

It is the supplier's salesman who presumably should move heaven and earth to make friends—good friends—of his customers. But it takes two to make a friendship. And, in the world of salesmanretailer relationship, it may take more than orders (nice as they are!) really to establish a deep friendly relationship with a resource salesman who merits that kind of relationship. One merchant we know has made it a practice over the years to write an occasional letter to the president of a supplier to express appreciation for the services rendered by one of that supplier's salesmen. He tells us that the results of this small gesture are almost unbelievable. Moreover, he has found that the larger the corporation—the more amazing are the results. But let's give you the story in his own words: Some months ago, I wrote to the president of one of our largest hosiery mills. I told him how his salesman had helped me to control my inventory, increase my volume, improve my net profit on hosiery, and still serve my customers better. I mentioned how this program, at the start, had actually resulted for one season in a smaller order for his brand. But then I told him how our volume on his brand had since picked up—and I expressed my appreciation for the job this salesman had to do. First I got a telephone call from the president of that giant hosiery mill thanking me for my thoughtfulness. Then I got a letter from the sales manager saying that the president had called him in, read my letter to him, asked him to compliment the salesman, and directing that a copy of my letter be sent to the entire sales force. Then I got a phone call from the salesman thanking me for what I had done. And, a month or so later, when that salesman made his regular call



on me, it was obvious that he had been giving my account even more study than usual because he had some ideas all worked out to give me. Moreover, he went over my inventory even more closely than ever before —and he wound up saying that he had been authorized to give me, for free, a brand new and expensive floor fixture.

If a simple letter can accomplish that much—and it can!—why not take time out occasionally for a bit of praise for a supplier salesman when praise is due and maybe overdue? The salesman is on the receiving end of beefs—constantly. Usually the only time his home office hears about him from an account is because of a complaint. He gets pounced on by the trade, by his manager—and probably by his wife when he gets home for a week end! A deserved pat on the back for a supplier salesman, under these circumstances, might work miracles.
Bring Down Transportation Costs

Retail net profit is measured in tiny percentage figures. This suggests that tiny percentage figures in the form of cost saving can make substantial additions to net profit. It is significant to note that the two largest retailers in this country— one in food and the other in general merchandise—are currently engaged in deep studies designed to cut their transportation costs. They are putting costly electronic calculators on this job. And they are looking for penny savings. Transportation costs can be brought down in these ways: 1. Groups of independent retailers and smaller chains are jointly em ploying transportation or traffic experts as advisors. 2. Merchants are corresponding with the transportation departments of major suppliers to work out more economical shipping procedures. 3. Merchants are working more closely with transportation agencies to obtain better advice on this subject. 4. Buyers are being instructed in how to arrange buying programs for more economical shipping—and how to write up orders so as to obtain the lowest possible transportation costs. 5. In some areas, the local Board of Trade has instituted special studies on the subject of more economical transportation techniques. 6. Out on the Coast, several food chains have actually pooled their re sources to build a jointly owned and jointly operated warehouse which promises to reduce shipping and reshipping costs substantially. 7. Several merchants report that they are questioning all of their tradi tional incoming shipment procedures on the premise that any plan that has gone along unchanged for a number of years may now be outdated. There is no question that many merchants who have successfully re-



duced costs through such major steps as conversion to self-selection or self-service continue to roll up total transportation charges that grow larger each year. Too often, the most that some merchants do in this area is to complain occasionally to a supplier about shipping costs. Unfortunately, shipping rates are destined to rise—rapidly. Here is an area where cost savings must be made—and can be made. Both individual action and joint action by merchants are vitally necessary.
Bring Dead Space Back to Selling Life

There is scarcely a department or a section that doesn't include some dead space. And there is seldom any such thing as dead space that can't be made to do some form of selling. For the executive, there are few functions more fascinating, more thrilling, more rewarding than, first, to find dead space and, second, to breathe life into it. Oddly, the more intimately one knows a department or a section, the more difficult it is to spot dead space. This is because we really don't see something that comes within our view daily and hourly. Thus, New Yorkers who pass the Empire State Building every day just don't see it. Similarly, the executive who has a department under his constant observation tends to get a blurred image of it. The first step, therefore, in spotting dead space is to compel one's self to look at the department with a completely fresh approach. Accept nothing as necessary, accept nothing as final. Question everything—especially, of course, space that is not being used for any selling purpose, or space that is being used for trivial selling purposes. Then, with respect to all such space, ask: how can that dead space be turned into a dynamic sales producer? Or—how can that practically dead space be given a shot of sales dynamism? If it is "high up" space—what could be displayed way up there (and how) that would compel the shopper to look up? If the space is down at ankle level—what type of bin, what kind of near-the-floor shelf, would induce shoppers to stoop and even crouch? We have seen examples of pillars being put to selling use, but we have also seen areas around the cash register that were actually being wasted. We have seen counters that made no attempt to utilize the "air" overhead—single-tier counters in a triple-tier age. Shelf extenders are unknown in many types of stores, yet they do a big job in stores that employ them smartly. We saw one instance of a departmental head who picked up two feet of valuable space by simply cutting down on the width of the salesperson's entrance into the section. It is a fact that the newer types of low-margin retailers jam merchandise into every nook and cranny of every department. And they get it right



out where the customer can pick it up, or feel it, or examine it. Sometimes some merchandise is knocked over by aisle traffic—but the loss here is tiny compared to the volume done on a square-foot basis. They show little, if any, dead space. So take a fresh, new look at that department or section, a look concentrated toward just one end: to find dead or practically dead space and then to breathe vital sales life into it. Happy hunting!
Winning More Loyal Customers

It has been said—and correctly—that customer loyalty to a specific brand or store is at an all-time low. Some stores are exceptions; but they are a minority. That situation is not apt to be changed drastically. Shoppers are more sophisticated, more mobile, more changeable, more willing to experiment. These new shopper habits are, if anything, more firmly ingrained in the younger shoppers—and it is young shoppers who accumulate possessions. However, every so often we see a store or a section in a store that obviously is outperforming others in its ability to keep the same customers coming back time and time again. The explanation usually is found in an executive who has learned the gentle art of cultivating loyal shoppers. Interviews with some of those who have a gratifyingly high percentage of loyal shoppers underscore the following explanations for their success: 1. They get out on the floor more often than most department heads. This is important. You can't hold the customer in above-average numbers until you know the customer. And to know the customer, it is necessary to meet the customer. 2. Also, by getting out into the department, the merchandiser can not only take frequent eyeball inventory checks (always important in pre venting out-of-stocks and temporarily unbalanced stocks)—but can also see at first hand how customers are being served. 3. They make it a point to find out from the customer why she has made a certain purchase—and, equally important, why some shoppers walk out of the department without buying. The walk-out is the key to success —decrease the walk-outs and you automatically increase volume. 4. They dispose of inventory mistakes promptly. 5. They try hard to be the first with the most—in new items. 6. They work closely with the sales promotion department—and this means giving sales promotion sound and exciting ideas, not merely ac cepting the old, done-to-death promotional formulas. 7. They not only visit women's clubs, etc.—they speak before these im portant groups; they do a superlative job of being citizens, which happens also to be a vital part of being a superlative retailer.



8. In brief, these executives function very much as did our most successful old-time merchants—on a personal basis with customers and with personnel. They employ that magical personal touch. How Much Fussing over the Fussy Customer? It's been said that there's a "lunatic fringe" among shoppers—customers who are excessively fussy, unreasonably demanding, almost impossible to please or even satisfy. How much fussing is warranted over the fussy customer? Well, consider these facts: 1. The fussy customer is, of course, particularly vociferous. She may constitute no more than five per cent of customers—but she may make "more noise" than the remaining 95 per cent. Don't be panicked by the clamor she raises. 2. The fussy customer uses services;—costly services—to an extraor dinary degree. And she is constantly demanding "special" services, some of which tend to become "regular" services after a time. She may repre sent only 5 per cent of the customers, but use 20 per cent of the services rendered by a store. 3. The fussy customer, if excessively catered to, compels expensive additions to inventory which slow down turnover. 4. The fussy customer takes two and three times the amount of time to complete a buying transaction. This adds to costs. 5. The fussy customer is one of the causes of costly employee turnover. 6. No matter how much the fussy customer is catered to, she seldom puts in a good word for a store because she simply cannot be satisfied. Since her family and friends tend to recognize her eccentricities, her com plaints to them about a retailer are not given much weight. 7. The fussy customer tends to be a disloyal customer—she wanders from store to store. 8. She causes walk-outs by monopolizing sales help time and attention. Many, if not most, retail executives have modified the old-time policy which preached that "the customer is always right." But because the fussy customer tends to be so outspoken, so persistent, so threatening, there is perhaps a too-common tendency to overrate her importance. The important point to bear in mind is that the fussy customer is not quite the "boss" of retaildom that she imagines herself to be—and that she usually represents loss, not net profit. She perhaps must be tolerated, but that does not imply that she need rule the roost! Needed: More Retail Volume per Labor Hour To date, retail payroll costs have shown no downward tendency. If anything, the trend continues up. This is the critical problem of retailing



today. Retail net profits simply cannot rise until the payroll percentage drops. The acuteness of the problem is graphically delineated when it is borne in mind that the payroll percentage has not declined despite rising price lines, despite larger total dollar gross, despite diversification in inventory classification, and despite self-service. In the majority of retail operations, these great changes in retailing have—at best—merely succeeded in braking the upward trend of wage costs. It is particularly disturbing to note that the introduction of selfservice in retail areas where it was not formerly used has in no way duplicated the performance of the original food supers. Where can the executive in retailing look for techniques that hold potentials for cost slashes? Basically, these are the functions to which smart executive thinking must be applied: 1. The more effective use of part-time employees. Most retailers ac count for 75 per cent of their gross in less than 25 per cent of store-open hours—this spells out the need for more part-time employees. These parttimers can also cut down the gigantic volume lost during peak hours. 2. Fixturing for a higher gross volume per square foot. Discount houses report square-foot figures from three to eight times that of other outlets. (A developing trend toward the leasing of fixtures may make practical more drastic fixture changes and free capital for other purposes.) 3. Concentrate on dollars not percentages. Percentage-itus is a root cause of poor volume per labor hour. 4. Speed up the completion of the shopper's buying transaction. Even the order books commonly used require a horribly large amount of time in many stores. Ditto for wrapping, change-making, etc. 5. A better analysis of vendors. Some vendors have programs that make big contributions to more volume per labor hour; some don't. Have accurate figures on this point. There are other policies to be examined—more flexibility in price lining, improved selection of personnel, new personnel incentive systems, etc. Whatever the techniques, the great objective must be more volume per labor hour.
Customer 111 Will at Closing Time

How many of your customers have left your store at closing time thoroughly grumpy and even vowing never to return? There is no question that a disturbing percentage of the customer good will built through numerous policies and at high cost is changed into antagonism at closing time. Too many floor people begin "closing down" ten minutes, twenty minutes, even a half hour before closing time. They



resent the presence of customers at this time. And they too frequently make no effort to hide their resentments. Have you ever shopped your store or department just before a closing time? Try it. Note how many of the floor people are busily engaged in housekeeping. Note how many are clearly trying to rush their customers. Note how many are clearly trying to discourage customers from starting a purchase—one of the techniques is to ignore the would-be customer. Unquestionably, there is a higher total of both lost sales and lost customers during the fifteen or twenty minutes before closing time than during twice that time period at any other part of the day. What to do about it? 1. This is the time for store executives to be on the floor, to circulate on the floor, to note what is actually taking place, and to take appropriate ac tion. The presence of one or more executives on the floor just before closing time, as a regular practice, will go a long way toward correcting this situa tion. 2. Arrange for special shopper reports during this time period, and offer rewards to salespeople recommended by shoppers. An incentive can be a big help in this situation. 3. Compile figures on the volume done during the closing half hour. When the figures move up—as they will if the customer is given half a chance to buy during this time slot—show the staff, on a chart, how courteous service up to the closing gong can add to volume. Then reward all employees with good records for this achievement. In brief, the gentle art of winning and holding customers during the last few minutes of each day involves: (1) the on-the-floor presence of an executive, (2) uncovering those who discourage shoppers from buying, and correcting their attitudes, (3) compiling volume figures and sharing them with the staff, (4) special incentives. More and more, closing time has become a half hour lost to retailing. Pick up that lost half hour—it can add greatly to volume and profit. If It's Hot—Make It Hotter Every so often, a new line, or item, or fashion will show every unmistakable sign of becoming "hot." It is no trick simply to move along with a "hot" item. But it is a real trick—and a mighty effective trick—to make a hot item still hotter, to play it for all it's worth. When a department or section head does more than simply climb aboard a fast mover, when he actually gets into the caboose and shoves the merchandising-promotional engine into high, then he can achieve: 1. A gratifying increase in volume.



2. A gratifying increase in net profit—because fast movers usually provide healthy margins while they are in top demand. 3. Establish for his department a reputation for being the first with the newest, and with the mostest of the newest. 4. Step up traffic in the department—with a resulting benefit to other lines carried in the department as well as with benefit to the store as a whole. Actually, there are two stages in fanning a hot item into a fever pitch of excitement. Both require courage and astute timing: Stage one involves catching the trend on the upbeat fairly early and riding it hard. That calls for smart timing—and the courage to back up one's convictions. Stage two involves equal astuteness in timing and equal courage. We refer to the vital importance of slowing down before the item goes dead. In the stock market, it's been correctly said that the smart speculator never tries for the top or for the bottom; he plays the big, profitable, in-between area. Similarly, in merchandising, it is wise to forego the last 10 per cent or even the last 20 per cent of potential volume—if this means hanging on too long. It is just about as unprofitable to overstay a hot number that is cooling off as it is to ride it timidly in its early stages and especially its middle stages. Parlaying a trend in an item or line of merchandise involves more than adequate stocks. It involves exciting ideas, exciting advertising, exciting departmental displays. It involves exciting the departmental staff—it involves enthusiasm that boils up to fever pitch. There are few more satisfying experiences in retail merchandising than come with the thrill of having latched onto a winner, playing it high, wide, and handsome—and then closing out at just the right moment.


780 Tactical Ideas That Move Merchandise

Larger Markdowns—Higher Gross Margins?

A controller for one of the great chains insists that larger markdowns taken promptly—rather than piecemeal markdowns taken over a period of time—may be the road to higher gross margins. His point is that traditional markdown procedures tend to reduce turnover, put a brake on open-to-buy, increase stock shortages, add to sales promotion costs, unbalance stocks with too high a percentage of slow movers and the buyer tends to buy promotional items with low mark-ons in order to stimulate volume. Larger markdowns, taken more promptly, will—in his opinion and ours—result in a considerably improved overall performance.
What Is Your Break-even Point?

Manufacturers tend to know their break-even point pretty well. But in retailing, the break-even point is not so clearly marked out as a rule. Few merchandisers know their break-even point for the store as a whole— and department by department. Few can answer such questions as: What will be our profit or loss at X sales volume? What additional sales volume will be required to cover the additional fixed costs arising from a store modernization program? What sales volume is required to earn a specifically planned profit figure? How much will a given reduction in gross margin change our break-even point? Too few retailers can answer such questions as these, and, consequently, too few have ever made a breakeven analysis. Modern accountants know how to estimate the retail breakeven point. Why not have a special break-even point study made?
When Advertising Lays an Egg in the Store

It is truly amazing to note the frequency with which stores neglect to do anything inside the store to remind the shopper of the newspaper ad she has just seen. And this neglect doesn't apply only to in-store display. It applies also to the salespeople who sometimes haven't even seen the ad. In too many stores simply nothing is done inside the store to bring the newspaper advertising to selling life. Advertising doesn't make the sale; it starts the sale. More of these will be completed when special displays and special reminders by salespeople do the follow-up. Try shopping ad166



vertised items. See whether there is an instant and a forceful reminder of the advertised special when the customer walks into the store or department. Test salespeople's knowledge of the advertising. Check special displays. All this is obvious policy, and yet over 50 per cent of retailadvertised items receive no special in-store or window promotion whatever.
The "Older-weds" as a Market

Is too much retail promotion aimed at newlyweds—too little at olderweds? The point could be argued—but there is no doubt that the couple married two, three, and five years continues to be an excellent prospect for an infinite variety of merchandise. A number of retailers are therefore setting up a registry for older-weds, similar to the register so commonly set up for newlyweds. This register is for the "post-newlywed" years. It helps eliminate confusion in connection with anniversary gifts, for example. And, of course, the theme "older-weds" is susceptible to smart thematic development in newspaper advertising, such as appeals to "The Bride and Bridegroom of Yesterday." The plan helps to keep the newlyweds as customers as they become older-weds, and it also helps retailers to remember that the "bridal" market does not consist solely of the newlywed.
Selling in the Window

As a promotional unit, the window is on the decline. But as a selling unit, it is in a positive uptrend. This new trend takes the form of putting vending machines in the window. Hundreds are now in operation; soon the total will be in the thousands. These window vendors work 24 hours daily—Sunday, too. Interestingly, they sell more during store-open hours than when the store is closed. What is being vended this way? Cigarettes, candy, some health aids, etc. One of the country's largest builders of shopping centers is planning to install window vendors in the majority of the stores in his centers. These vendors will even be refrigerated—thus they will sell certain foods, including butter and milk. Techniques have been developed for putting these vendors into the plate glass. Tests are being made of the items that move best through the window vendor— locality by locality, store type by store type. This is all part of the broad trend toward more "sidewalk retailing" and toward selling 24 hours daily, seven days of the week.
Outside Gimmicks—Inside Mid-Victorian Stiffness

Retailers use all sorts of stunts to bring shoppers into the store. But once the shopper walks into the store she leaves excitement behind. There



are three-ringed circuses outside, monotonous standardization inside. Yet most of our present-day retailers originally fought to create a carnival atmosphere inside their stores—and to this day when department stores, for example, run a warehouse sale they plan a carnival-type operation. They create an atmosphere which is not extended to the main store. Is the customer at a warehouse sale a different customer from the shopper in the main or branch store? Is the shopper in a carnival-type discount house or farmers' market a different shopper from those who buy in food stores, drugstores, variety or department stores? Take the early food supers—they were models of dramatic excitement inside the store. Today most food supers are models of decorum. Shopping really isn't the serious business that some retailers imagine it to be. Moreover, everybody loves a circus—even when shopping. Actually, sawdust in the aisles may not be the ticket. But certainly some retail outlets would benefit by displaying the same stunts inside the store that are used so often outside to attract traffic.
Promote Fringe Benefits—Dramatically

Fringe benefits tend to decline in importance to store employees with each passing month. Each new benefit is rapturously welcomed—and then, in short order, becomes passively accepted. One large retailer promotes his fringe benefits to employees with all of the excitement with which this chain promotes specials to shoppers. Large signs are used in employees' rest quarters. These signs remind the workers about store policy on vacations, free insurance, employee discounts, hospitalization, retirement. Every day every employee is reminded—dramatically—of at least one fringe benefit. Some day check your employees; see how poorly informed they are on fringe benefits—and how little importance they attach to these benefits. Then decide to make fringe benefits the subject of a "promotion"; a promotion to employees. It will cost little—it can build employee morale, cut down turnover.
Shriveling Nonproductive Space

In several retail fields, the ratio of nonproductive space to selling space has shown an expensive tendency to rise over the last few years. This is one of those insidious developments that build up almost under cover—and then explode as full-fledged problems. It would pay almost any retailer to make a personal and periodical check of newer competition—the discount house—to observe how these merchants keep their nonproductive space at a minimum. This may be an extreme—and it is clearly evident that discount houses are right now adding to their nonproductive space. But they can still offer ideas to other merchants in the gentle art of keep-



ing nonproductive space at a minimum. So visit the "enemy" some time— solely to study his techniques for shriveling nonproductive space.
Liberalize the Employee Discount Plan

A large independent merchant reports that he has decided store employees look upon the employee discount as one of the valuable fringe benefits in retail work. He has, therefore, made his employee discount plan quite liberal, and he doesn't concern himself with whether or not the employee's family or even friends may benefit. Here are the details of his plan: The employee gets a flat 20 per cent discount on all merchandise, regular or sale. Employees may use the discount for purchases up to onehalf the employee's total annual salary. Employees make all purchases at retail—at the first of the month they turn in their sales slips. The discounted amount is then either credited to the employee's charge account or refunded in cash. Incidentally, these discounted amounts are not charged to the respective departments—this avoids any tendency on the part of department managers to slight the employee making a purchase; the department gets full credit for the sale and the employee gets treatment equal to that of any customer. This same policy applies to adjustments—the employee gets the same treatment as customers.
A Blizzard of Paper

There are special organizations doing a whopping business by simply advising clients how to cut down on paper work, on files, on space devoted to files, on employees doing unnecessary paper work. An enormous amount of paper work in all businesses was begun years ago—and continues simply because nobody has called a halt A good place to start cutting retailing's paper work is with regular reports. Why not subject every regular report to this quiz: (1) Is the report correct? (2) Can the report be grasped quickly? (3) Can those who get the report interpret it properly? (4) Have you evidence that the report currently serves a useful purpose? (5) What changes would be suggested by those who get the report? (6) Should its frequence of issue be revised? Can it be eliminated en tirely?
Is the Bottom Shelf for Slow Movers Only?

One retailer reports that he stocks some of his fastest moving items on bottom shelves—and his figures prove they move as well as at eye level. However, his basic aim is to take typical bottom-shelf lines and make them move faster. He does this by smartly displaying bottom-shelf merchandise so it wins added eye appeal. For example, packages are placed to show



their greatest surface—thus they can be easily seen from a standing position and hit the shopper with the greatest possible impact. Another trick is smart shelf planning; thus, in this store, the lowest shelf may be 22 inches deep and 12 inches high, with the next shelf up being 14 inches deep and 10 inches high. Each shelf thereafter decreases by 2 inches in depth but remains 10 inches high. In general, bottom shelves can be made to do a better job by giving them special fixturing and display attention. A woman who bends constantly in housework, gardening, etc., will bend for a bottom shelf—if the proper appeal is made. As for the increasing droves of men shoppers—they have little, if any, objection to bending.
Store-fixture Leasing May Soon Be a Trend

The tax situation and the problems of capital entailed by the competitive need to expand combine to suggest the wisdom of applying the leasing concept to new fields. Thus, truck leasing is moving ahead rapidly, and now car leasing is making big gains, also. One of the newer fields for leasing is store fixtures. Several companies now specialize in this field. More will probably operate in this field before long. Some stores have arranged to sell their fixtures and then lease them back on a purchase lease-back plan. (One company in this field claims to have leases totaling almost $100 million.) Whether we will ever reach the point where the tax load, etc., may compel retailers to own little if anything in the way of plant remains to be seen. But there is little doubt that the leasing concept is destined for still broader applications in retailing; we understand that even bookkeeping and billing equipment is leased by some retailers. Check into storefixture leasing—it may simplify your expansion problems and also simplify problems stemming from new credit services offered to customers.
Cut Employee Turnover by Starting Them off Right

Recent studies have clearly indicated that among the many reasons for high turnover among retail employees (including low pay) is the failure to start the employee off in the right way. In large manufacturing companies, psychologists, personnel directors, social workers, etc., etc., have been brought together to evolve remarkably complete programs for starting the new employee off on the right foot. In few retail organizations is this done on anything remotely resembling a comprehensive scale. The first day, the first hours are critical so far as the new employee is concerned—male or female. And on that first day it isn't the long-term future that is important; instead, it's giving the newcomer a sense of belonging, of coming into a fine "family." It's the greetings they get from the store manager, from section heads, from other employees that count. An unhurried tour of the store, maybe lunch the first day at store expense,



and seeing to it that during the first week friendships are formed—these are among the procedures that will help to cut down employee turnover.
Saving Salespersons? Time during Peak Periods

Most retailers do from 50 to 75 per cent of the total week's volume in from 12 to 18 hours. During these peak hours, there may be from 2 to 10 customers on the floor per salesperson. And during these peak hours, salespeople spend over half their time on everything but selling—writing up orders, wrapping, making change, etc., etc. More and more retailers are developing new plans for saving clerk time for selling during these peak hours. This is one reason for the current popularity of the cash-wrap desk. A newer plan involves the use of part-time employees during peak hours whose primary function is to complete transaction details after the regular salesperson has made the sale. Most stores have a hard core of capable salespeople comprising from 10 to 20 per cent of the selling staff. Free these few capable salespeople for selling, rather than details, during peak hours—and thus make the most of their selling ability, especially on big-ticket items.
The New Mass-class Market

Champagne is enjoying a boom. Ditto for caviar. Ditto for rock cornish hens. And thereby hangs an object lesson for many types of retailers— namely, that this democratic nation is going aristocratic in a fascinatingly impressive way. The 400 have become 4,000,000. And, what is even more important, 40,000,000 are desperately eager to flaunt the presumed symbols of financial and social affluence. In food, as we've already indicated, this takes the form of a startling demand for champagne, caviar, exotic and connoisseur foods. In apparel, it takes the form not only of mink—but of a more lavish total wardrobe than ever before in the history of civilization. In home furnishings, it took the form of wall-to-wall carpeting—now it is going on to area rugs, to hand-made furniture and decorative conversation pieces. In appliances, it takes the form of a demand for super models. In cameras, the high-priced models and expensive gadgets are getting a remarkable play, and the same applies to boats, hunting and fishing equipment, etc. In brief, the former highly exclusive class market is becoming a mass market. Thus retailers must learn how to cater, in certain merchandise classifications, to this new mass-class market. The food supers are showing the way with their Connoisseurs Corners. The Boutique Shop is the approach of the department store, or one approach. The sharp upping of price lines by the variety chains is another example. This is a permanent, long-term trend.



The Chicken or the Egg?

So many firm store policies—with regard to merchandising, for example —raise the question: Which came first, the chicken or the egg? In other words, do customers refrain from buying a certain line, for instance, because of their own preferences—or because the store's merchandising policy has conditioned them? Let's take a typical example: In one shopping center, three large stores—whose customers tend to shop in all three! —report that Store A does a large volume in hooked rugs. Store B carries no hooked lines but concentrates on luxury chenilles and popular-priced synthetics. Store C merchandises mainly axminster lines, twists, and synthetics. Is there any reason why Store A can't do a big job with chenilles, or Store B with hooked rugs, etc.? Probably not. Very likely, customers in Store B will buy a chenille and then go over to Store A to buy a hooked rug. What a store carries determines what the shopper buys. But too often this is forgotten and retailers conclude that their existing merchandising setup was dictated by the shopper, whereas it may simply be a case of perpetuating a policy and, sometimes, perpetuating a mistake.
How to Cut Costs

In one city, a group of stores are trying to get together on a uniform sales check—objective is to reduce printing costs. Greater uniformity among local stores on other printed forms, and on other paper supplies as well—plus joint purchasing—could help to slash these items of cost. As a matter of fact, there is a big area for cooperation among local merchants that could help cut costs—even window washing costs could be reduced through joint endeavor. Along this same line, if stores were to get together, a charge could be put over for customer checks that are returned from the bank for any reason. In one city, a large department store is charging a $1 fee right now when this happens, but, clearly, these charges are more easily instituted when the majority of competing merchants agree to make them. Retailers haven't even scratched the surface when it comes to cost-cutting through cooperative endeavor.
The High Cost of Something for Nothing

Consignment deals—memo deals—all forms of "We'll put the merchandise in your store entirely at our own risk; you can't lose a penny" make a big appeal to many retailers. Yet one reason so many stores show too many duplicated lines, too many slow movers, traces right back to the innumerable variations of the consignment offer. It costs a retailer money to put a line into his store whether it is consigned or not. And it is a tough



job to get rid of a line, once it's been put into a store, as every retailer knows from bitter experience—tough and costly. A merchant who isn't sufficiently convinced about a line to put his money into it and back of it will almost invariably do better not to add the line. Some smart retailers have finally become aware of the high cost of "something for nothing"— when that "something" is an addition to inventory. Show How It's Made—in the Window Straight merchandise displays in windows are attracting less and less attention—the shopper is doing less window shopping. Consequently, window displays (if they are to pull results that will justify the mounting costs of window display) must pack more drama, more excitement, more action. In this connection, windows that show how a product is made have, over the years, regularly proved their ability to stop traffic, hold traffic, sell traffic. Recently, a food super staged a unique cooking demonstration in its windows, a specialty chain staged a two-day demonstration showing how suede coats are made, another store used its windows successfully to show how rayon carpetings are made. Over the years, windows have been used to show how perfumes are made, how certain furniture items are made, etc. And if the idea really is appealing, why not put a few ringtail monkeys in the window? An appliance store did just that, and, believe it or not, those cavorting monkeys increased store traffic and sales!
Improving Employee Meetings

Meetings of store employees will be improved if: (1) Meetings are held outside regular store hours and overtime rates are paid. (2) Employees get plenty of notice so they don't have to cancel personal appointments, etc. (3) Meetings last no longer than 15 minutes—30 minutes should be tops. (4) Coffee and doughnuts are served at morning meetings. (5) Meetings are planned well in advance. Have a specific program—stick to it. (6) Don't try to give them too much or you'll give them indigestion. (7) Don't rake anybody over the coals at these meetings; this is not the time or place. (8) Try to get them to participate; this is most important. (9) Don't ask for the impossible; and don't be too inspirational. (10) Always remember that a bit of humor will go a long way.
New Trends in Sales Units

In many merchandise categories, new sales units are currently being tested. The multiunit carton, in particular, is being experimented with widely. In the food store, the multiunit carton is being tested for canned foods (including cranberry sauce, tomato juice, and dog food), for bottled



cleansers as well as packaged cleansers—and the soft drink and beer bottlers are constantly developing new multiunit packs including the new larger-size bottles. In the drugstore, multiunit cartons of baby and dietetic foods are being tested—why not multiunit tests on dentifrices, toothbrushes, and scores of other items? The hardware store is also moving from "banding" of multiunits to cartons of multiunits. There is, actually, a broad trend developing involving new concepts in sales units—with particular emphasis on multiple units, which, of course, mean larger average sales. Auto shopping makes this possible—plus larger homes and families.
Action, Action, Action

There are fewer action displays in all types of stores than for years. Why? One reason—stores have become too sedate, too uniform. Retailing needs the interrupting note; action displays can provide it. A second reason for the trend away from action displays—mechanical trouble. But today these troubles are fewer than ever before. A hard-goods store reports excellent results from a carousel showing small appliances; a food store has used the same device for special foods. Many suppliers offer excellent action displays; some of these displays use merely the heat from a lighted bulb to provide action. Try action displays—in windows, inside the store. Action displays can give sales action!
Gift Buying by Children

Youngsters do an astounding total of gift buying—they buy gifts for their parents, for grandparents, for other relatives; and they buy gifts for other youngsters. Yet how many department, drug, or food stores—other types of stores, too—have established a "Mom and Dad Gift Shop" where youngsters may conveniently buy gifts for their parents? And how many stores have extended this section to the stimulation of other gift purchases by children? One department store recently assembled in such a section these items: toiletries, neckties, jewelry, trinkets, housewares, gloves, notions, billfolds, playing cards, etc., priced from 35 cents to $5. The section was located on the floor selling youngsters' apparel. It did extraordinarily well, especially during the Christmas season, and also for Mother's Day and Father's Day. It is now merchandised on a smaller scale year round.
Our Mobile Population

No less than 21 per cent of our total population—some 40 million people—change their residence each year. Of that total, about 28 million will move within the same county; 7 million will move to a different county within the same state, 5 million will move to a different state. Perhaps 90 per cent and more will make new retail contacts when they move. Thus



some millions of families will be picking new retailers this coming year for this reason alone. While several services are available to retailers to welcome these newcomers, it seems clear that too little is done to capture their business—and too much of what is done is done in a humdrum way. Another point: at least another 20 per cent of our population will change one or more retail contacts for one reason or another. Thus, at least a 40 per cent turnover in customers can be expected by many retailers each year. Figures such as these should make more merchants more fully aware of their basic problem of attracting new customers on a substantial scale.
Customers More Willing to Pay for Services

Discount houses are adding services—but charging for them. Department stores are charging for more and more services formerly offered at no fee. Various types of chain stores are offering a few services at a charge. All this means (1) that the customer is being conditioned to expect service even in low-margin outlets and (2) that the customer is being conditioned to expect to pay for services. As a matter of fact, the customer is also being conditioned to expect to pay extra for extra features in merchandise—the auto industry charges for scores of extras; in new homes today, there will be a difference of as much as 25 per cent in the "basic" price of a home and the "complete" price. All this suggests that many merchandisers would do well to reevaluate their policies involving charges for services to determine whether certain "free" services can now be charged for. The public may be more willing to accept service charges than some merchandisers believe to be the case.
Simplify Those Sales Cheeks

It's astounding to note the time required in so many stores for salespeople to fill out sales checks. During peak hours, archaic forms of sales checks cause a large loss of profitable business—customers just become discouraged and walk out. One store reports a 50 per cent time savings on transactions and more sales per clerk as a direct result of a new simplified sales check. This new sales check involves a minimum of handwritten information (here is where many forms of sales checks are still in the horse-and-buggy stage) and carbon handling and distribution of carbon copies are eliminated. In this instance, the new sales check is tied up with new cash register equipment. However, the sales check itself can be greatly simplified in most stores—give it some thought
Do Shoppers Insist on "Feel"?

Many merchandisers are still convinced that, for certain merchandise categories, the shopper insists on "feeling" the item. Actually, shoppers



are tending away from "feel"; among other reasons, they can hardly determine anything these days by "feel"—merchandise construction is too complicated. Indeed, expert store buyers cannot tell too much anymore by feel. For several years, some merchants fought against packaged hosiery—as a typical example—because they were sure a woman would not buy hosiery unless she could exert her traditional privilege of putting her fist inside the hose. Yet, a survey showed that actually SO per cent of the women interviewed preferred prepackaged hosiery. Displays that permit "feel" may still serve a function—although this, too, is declining. But, by and large, the day of "feel" in merchandise is over—from produce to soft goods.
Round-the-clock Promotions

Round-the-clock promotions have been amazingly successful in the stimulation of volume for major appliances. These promotions have kept stores open 24 hours a day for three days and more. Just why the idea appeals to the shopper is a bit of a mystery; but its appeal can't be disputed. Why not adapt the same idea to other fields—to soft goods, home furnishings, etc.? Give it a thought. Bear in mind that the warehouse sale, which started with major appliances, has now been successfully employed for furniture and home furnishings and even for soft goods. Of course, some food stores have remained open day and night for years; ditto for some drugstores. But these are traditional hours for these particular stores— what we are talking about is the generation of a huge excitement over an unusual store-hour schedule for a limited period.
Giant Models and Pets as Attention Winners

The giant model has an amazing ability to stop the shopper. A giant chair, for example—five times larger than usual—will bring passing traffic to a halt. A giant package of a food item will achieve the same result in a food store. And a giant mortar and pestle has worked wonders for several druggists. So has a 6-foot lithograph of a beautiful model. And talking about attention getters—domestic pets (cats, dogs, birds, etc.) can do better than earn their keep in some retail stores. A canary in song neatly caged in a retail store has been known to increase the average sale—believe it or not! (A furniture store reports that a dog in its window has tripled its window's stopping power.) 4 Reward for Prompt Payers When a customer has paid up a credit account, one retailer sends a small gift and a pleasant letter thanking the customer for clearing up the account and offering further credit facilities. While new types of revolving



credit may make this idea less widely useful, there are still thousands of credit plans in operation where a gift and a thank-you letter at the proper time would accomplish a great deal.
Apples—the Perpetual Promotion

Years ago, the Dennison Manufacturing Company—which is located in fine apple country in Framingham, Mass.—discovered that offering free apples at trade shows created more traffic at its booth and more conversation than any device used by other exhibitors. A large appliance chain staged a huge apple give-away promotion—and it moved appliances in enormous volume. There is something homely and appealing about munching an apple—someday the motivational research boys will be able to tell us why. In the meanwhile, accept it as factual that a give-away apple, munched on the store premises, may result in some apple pits on your floor—but it may also result in added sales by creating that friendly feeling which magically opens pocketbooks.
Sport Tickets as a Promotion

All types of stores are turning to the idea of offering free, or reducedprice, tickets to sport events. For example: a 165-store food super chain distributed a total of 85,000 reserve seat tickets for the VillanovaMississippi football game. A junior department store offered a free ticket to a professional football game with fashion or housewares purchases of $15. A food store offers a $2.50 sport event ticket on purchases of $10; a $3.80 ticket on purchases of $15. America is, of course, sports mad. The sport ticket promotional concept promises to spread—and it makes a most effective newspaper advertising offer.
Don't Overlook the Oldsters

In almost every trading area, probably 20 out of every 100 residents are between 45 and 65 years of age. Incredible—but true (except in some entirely new areas populated almost solely by young people). Moreover, in the years to come, the percentage of oldsters will increase—it will hit 25 per cent in a few years, 30 to 35 per cent in a few more years. And bear in mind that older people these days are vastly better customers than years ago. Social security, pension funds, larger incomes for more people, sensible savings programs—everything operates to keep older people as consumers on a giant scale. (And bear in mind that we haven't even mentioned the age group over 65—that age group now numbers some 14,000,000 people and is growing rapidly.) Plan stocks with these older people in mind. Frame an occasional newspaper ad for their attention built around a special promotion. Don't overlook the oldsters; their wants and needs are young!



When Everybody Promotes One Way, Look in the Opposite Direction

One of the most successful retailers in the country became impressed with the observation that all of his competitors were concentrating—in their import promotions—on French and Italian imports. He noted that so far as broad promotion was concerned, the British market was being neglected. He concluded that here lay opportunity, and a "British Fortnight" promotion was staged that turned out to be extremely successful. There is a general tendency in retailing—as elsewhere—to play follow the leader. It's not always a bad policy, especially in the early stages of a new promotional concept—but when almost everybody has turned to the same promotion, the time is ripe to look for a new and neglected approach.
Incentive Compensation Plans for Salespeople

In those outlets selling big-ticket merchandise, especially where the salesperson has leeway in meeting price competition, incentive compensation plans for salespeople are taking these forms: (1) A flat percentage of the gross profit. (2) A flat percentage on the selling price. (3) A flat percentage on selling price plus a flat percentage on gross profit. (4) A sliding commission rate based on selling price with the rate highest at list price and diminishing a percentage point at every 10 per cent off list. (5) Sliding scale commission on total month's volume. (6) A base commission plus sliding dollars on selling price. (7) Various combinations of these six basic procedures.
A Check List for Employee Exit Interview

A candid examination of employee policies can perhaps be best made by checking employees who are leaving. In one retail organization, an interviewer is expected to get answers from departing employees to such questions as: What, if anything, was especially disliked about work? Were working conditions satisfactory? Was equipment for job proper? Were rest periods, eating periods, and arrangements satisfactory? How was treatment from other employees? How did you feel about your chances for advancement? What can we do to improve our employee relations? What was your attitude toward management? Were you given ample training? Would you be interested in working for us again at some later time? Add or subtract from these questions, but systematize information-getting from exit interviews with employees. And be sure the employees are permitted to talk freely—an iron curtain between employees and management can be mighty frustrating to management.



How long Since You Said 'Thank You" to Regular Customers?

The regular customer is so seldom followed up by retailers with anything other than a sales pitch. Of course, there may be a card at Christmas—too often, however, it lacks totally in warmth. Or there may be a calendar. But why not try an actual gift—even if it is a very small one? For example: a huge hard-goods outlet sent each customer who had bought a dishwasher during a three-year period a gift of a pretty dress-up apron. With the gift, there went a letter which remarked: "We realize that you were among the first to discover the convenience of a dishwasher; we are sure, too, that you've helped introduce this appliance to your friends. To show you our appreciation, we're sending you a pretty little dress-up apron as a symbol of enjoyment in the kitchen." That little gift and that short letter—tied up with a clever newspaper ad inviting any who failed to get the letter but who had bought a dishwasher to come in for the gift—paid for itself many times over.
How to Stimulate Better Housekeeping

Self-service, self-selection shopping plays hob with store displays of merchandise. So do other factors—sometimes including the failings of part-time help. Here is a program to encourage better housekeeping: (1) A date was fixed for "Operation Clean-up." (2) This date was circled on "all calendars in the store. (3) It was announced that, on that date, top management from the store would visit all sections of the store and rate each section. (4) Each section was to be rated by two different executives and the scores of the two would be averaged. (5) All sections receiving a score of 90 per cent or more would get a "Sales Appeal Award"—framed. (6) Special awards would be made to each member of each winning section. (7) It was announced that, in the scoring, cleanliness would be rated 30 per cent, arrangement of merchandise 30 per cent, departmental displays 15 per cent, stock in drawers or cases 15 per cent, adjacent stockroom appearance 10 per cent. (8) There were 12 inspection teams composed of the 24 members of top management, ranging from the store president to divisional merchandise managers.
Suggestion Selling

Some months ago, a research team was sent into a number of liquor stores and instructed to say: "I'm giving a party for 12 friends; what liquor should I have?" Those wide-open-to-buy customers walked out of most package stores with a single bottle, a fifth! Recently, a large drug



company shopped 3,186 drugstores—the shoppers were given $5 to purchase any item suggested by the druggist in addition to the item they inquired about. Those shoppers had a spending power of over $15,000, but druggists suggested sales of only $2,500! Other studies among department stores and various types of specialty stores consistently show these results. Less than 17 per cent of salespeople in all types of retail stores make a specific suggestion for an extra purchase. "Anything else today?" doesn't turn the trick. Mounting retail costs can be fought only by lifting the average sales check—smartly planned suggestion selling, offering specific items with a specific sales pitchy is a sure-fire way to build up the average purchase.
Ouf-of-Stock and Understock—Twin Evils

If retailers were short of inventory only on slow movers—that would be bad enough. But out-of-stock and understock conditions seldom apply to slow movers; they practically always apply to fast movers, to the real profit makers. Another point: out-of-stock was poor business when personal floor selling was tops, but today, under self-service and self-selection conditions, out-of-stock and even understock mean hugely expensive lost volume. Do you know your fast movers, your big profit makers? Do you have a system that guarantees a properly balanced stock of these items!—always? And do you have another system that keeps the floor stocks of these profit makers properly balanced during peak selling periods? Remember, stock in back room or warehouse doesn't do a bit of good when floor inventory is low and store aisles are crowded.
Make your Signs "Sell-vertise"

Too many store signs simply identify—they don't sell. A sign that merely names the merchandise and gives the price is little more than a "directory listing." It has little genuine sell. But when a sign gives a talking point, an important talking point, then that sign both advertises and sells—it "sellvertises! It may cost more per sign to put salesmanship into signs, to make them talk, but the increased cost will be more than absorbed by the additional volume. Remember that in a self-service, self-selection age, signs can do as much of a selling job as the open display of merchandise. A sign we liked, as displayed in some drugstores, food stores, chain stores, and department stores, featured a bubble bath. The sell-vertising copy read: "Flower sweet—60 luxurious baths—Bubble Bath—3 39-cent boxes for only 98 cents." That sign had salesmanship.



The Element of Surprise

Our best advertisers know that successful advertising must have an interrupting note—something that jars the customer to attention. Exactly the same principle holds true on the retail floor; in-store display must be based on that interrupting note. But too many retailers these days keep the same merchandise, displayed in the same spot in the same way, day after day—and sometimes month after month. Their argument is that the customer comes to know where to find the merchandise, which is, of course, true. But without making such radical and constant changes that the customer must learn the store setup every time she comes in, it is smart merchandising to make merchandise changes not only as indicated by seasonal needs, but also simply to snap the shopper out of shopping too much by habit. The element of surprise—the placement of an item or line where the regular customer has not come to expect it—can work wonders in making extra sales. Dramatizing the Want Slip The want slip tends to become "just another form" after it has been in use for some little while. It's a good idea, therefore, to dramatize it. How? One store has a line at the top of its want slip reading: "I just lost a sale because we didn't have ________ " Everybody, from the clerk who fills it out to the executive who sees it, is thus constantly reminded that this isn't simply a piece of paper; it's a lost sale. A second idea is to route the want slips to a top store executive, and then have them percolate down— thus everybody knows that somebody higher up is fully aware of lost sales. A third idea: issue monthly reports listing sales lost and estimating dollar volume lost. These estimates of dollar volume lost can really be counted on to kill off any lethargic reaction to want slips. The want slip is one of the most important and less expensive tools in retailing—but its edge gets dull mighty quickly. Keep sharpening it!
Traffic Counts

Ever make a traffic count—day by day, hour by hour, department by department—checked for seasonal variations? One store that made such a study reports that it was able to pinpoint precisely its peak periods; by comparing customer count against regular sales and transactions, the ratio of sales transactions to traffic could be computed; the ratio of salespeople to traffic counts was worked out, and it permitted the store to make much more economical use of part-time personnel. The study pointed up the importance of personnel that worked from four to six hours and pinpointed the relationship of traffic to promotions. One discovery—when the store is



open at night, late afternoon traffic holds up better than on early closing days.
Keep "Up Front" Busy in See-through Stores

Old-time merchants loved to jam their store entrances—they put special tables there, heaped with "specials." Their theory: customers like to shop in a busy store, just as they prefer to eat in a busy restaurant. (Have you ever passed up a restaurant on the highway because only a few cars were parked there?) More recently, other merchants have developed the policy of putting particularly attractive merchandise to the rear of the store— "makes the shopper walk right through the store." But the see-through store would seem to clinch the case for "more business" up front. When sidewalk traffic can look right into the store, activity up front is highly desirable.
Incentives for Multiple Sales

The trend toward merchandising multiple units is remarkably strong. It is best evidenced in the tote-home pack of soft drinks, beer, etc., but is now winding up with canned goods and a host of other items. This, in turn, is encouraging various stores to develop incentives for salespeople to push multiple units. One merchant gives 20 cents to each salesperson who sells a box of hosiery—three to a box. Store shoppers are ordered to hand in reports on salespeople who do a good job of selling multiple units, and these salespeople are suitably rewarded. Training programs are being developed to show salespeople how to write up more multiple sales. A larger average sale is the royal road to a better retail net profit and the multiple sales unit is the best approach to that royal road.
A "Thank You" to the Big Customer

A customer buys a big order in furniture. Or in major appliances. Or in rugs. How seldom that customer gets a "thank you" letter. One retailer reports highly successful use of a thank-you letter that goes out about a month after the big-ticket sale has been delivered. The letter expresses the hope that the customer is happy, and a stamped return envelope is used for the customer's convenience in replying. Over 85 per cent of the customers do reply—the majority with enthusiasm. The few complaints that come in are welcome—the customer who has a complaint and doesn't voice it may never be a customer again.
Working with Clubs

Women's clubs, church clubs—all of the multitude of organizations to which women belong—offer retailing constant opportunities for mutually



interesting tie-ups. Special price offers are, of course, common. But it isn't always necessary to cut margins. Some stores, for example, simply offer a flat sum (from 25 to 50 cents) for every club member who shows up on a specific day. This may be done every month. It brings in traffic, and that traffic feels an urge to buy. The coffee break is sometimes made apart of this idea; with the club chairwoman as the hostess. Make the Store Twice as Bright The brighter the store, the less of a chore is shopping. And the less of a chore shopping becomes, the more the shopper buys. With these simple principles in mind, many retailers are calling in illumination experts (the local light and power company frequently makes the services of a specialist available) and are stepping up lighting. New combinations are being worked out of ceiling lighting, valance lighting, and spotlights. Also, paint colors are being selected to go with the new lighting—paint colors can work hand in hand with lighting when properly selected. Another point—even recessed ceiling lighting fixtures can supply a decorative note through smart design. Probably 75 per cent of retail stores are poorly lighted and use poor paint color combinations. Light and paint can even make a store look bigger! There are few less expensive ways to add to the visual selling impact of a store than by modern lighting and modern paint colors. Your Credit Customers Will Get Credit Customers for You Many stores stage contests among their employees to win more credit customers. But why not use credit customers to get more credit customers? One store having several thousand credit customers offered a pair of nylons to each customer who helped put a new credit customer on the books. The push jumped the credit customer list by 10 per cent. The cost came to $1.37 for each application received and this included the cost of the hosiery. Try this idea for charge accounts, revolving credit accounts, etc. Bring 'Em in to Shop by Taxi An amazing variety of retailers—including some food supers—are urging shoppers to "come in by taxi." Through arrangements with a local taxi operator, a typical offer of this kind will bring in shoppers "for free" if their purchases exceed a stipulated minimum; or the taxi ride is offered at an extremely low figure which, in part, has been subsidized by the store. Bear in mind that in millions of families it is Pop who takes the lone family auto when he goes to work, and this is one way of enabling the woman of the house to come in to shop, and in high style.



Everybody Has a Peeping Tom Instinct

The sidewalk superintendent is really a form of Peeping Tom. And that's why some builders surround their construction jobs with fences equipped with peep holes. And that, too, is why for many years a retailer has occasionally covered his windows with paper, leaving only a peep hole. The well-known shadow box is really a form of peep hole. In brief— appeal to the Peeping Tom instinct which, in turn, is part of the curiosity streak in practically all humans. It may or may not be true that curiosity killed the cat, but it most certainly is true that that which is partly hidden generates an almost irresistible impulse to get a good look. Just try walking down your street with a large picture carried upside down—and see what happens!
Don't Sail into the Wind

Some retailers are debating the wisdom of trying to build up volume on Monday-Tuesday-Wednesday, and early in the morning. The consensus now is that this is like sailing into the wind. More and more merchants are concluding that the time to sell the shopper the largest volume at the lowest cost is when the shopper wants to shop—not when the retailer wants her to shop. The problem here is to enable the shopper to buy faster during the peak hours. It's been said in retailing that only half the customers in a store buy; and only half of those who buy purchase all they intended to buy. During peak hours, walk-outs and "half" walk-outs are even higher than these figures indicate. The great opportunity for more volume at lowest cost is by developing plans that will enable the shopper to complete more buying transactions during the peak hours. Focus on that fundamental objective—don't spend big money trying to entice the shopper to shop when it isn't convenient for her to shop. It's costly to try to change basic shopping habits—it's wiser to change your procedures to conform with new shopping habits.
Opinion vs. Facts on Seasonal Changes

Habit dies hard. So do long-established opinions and convictions. As a consequence, too many retail merchandisers cling to seasonal practices which have become outmoded. It would benefit most retailers to make a check of the figures to see how changing habits of the shopper have changed the variations in the movement of certain merchandise. However, when making such a check, bear in mind that the new pattern in seasonal demand might have been much more emphatic than your figures show if the shopper had been both permitted and encouraged by your mer-



chandising procedures to shop in conformance with her new requirements. Remember that retail statistics reflect store policy as well as customer demand. And right now store policies are tending to damp down customer wishes for new seasonal buying patterns. Cuffing Marking-Receiving Room Costs Here is a program that increased production in the marking and receiving rooms by 15 per cent above norm; that permitted a one-third cut in employees for these two operations; that reduced payroll cost despite higher wage rates; that cut employee turnover in these two functions. This near miracle was achieved this way: (1) A group incentive—not individual bonuses. (2) Incentive payments start when group achieves 75 per cent of standard or normal output. (3) For performance above 75 per cent, incentive is an additional 1 per cent for each multiple of 5 percentage points (if any individual performs under 75 per cent, his operation is reviewed and corrections made, if indicated). (4) Mechanical improvements were made—and are still being made. (5) Time studies have been made of each of 46 functions. (6) Basic costs have been established. That's the program. Further benefits: (1) employees have enjoyed a bonus every pay period, (2) shipments move faster than ever before, (3) overtime has not been necessary, (4) while this store (a fine specialty store with a national reputation) is not unionized, it is understood that the program will not encounter union opposition.
Curbing Employee Pilferage

It so happens that manufacturers also suffer from employee pilferage— some on a staggering scale. What manufacturers are doing to curb employee pilferage may therefore be of suggestive value to retailers. Here are some ideas from manufacturers: (1) use of closed-circuit TV to watch employees, (2) "surprise" auditings, (3) switching members of the credit and collection departments to different positions, (4) lie detectors, (5) checking employees as they leave plant gates, (6) use of microphones to pick up voices, sounds. These are merely a few of the steps manufacturers have found helpful—some systems developed by big manufacturers are quite involved. (Incidentally, discounts to factory workers have been found to be helpful—-discounts not only on the items manufactured but on tools, etc. In fact, programs by manufacturers involving buying all sorts of merchandise for employees "wholesale" are aimed in part at curing employee pilferage.) In general, manufacturers have done more to cut down on employee pilferage than have retailers. Check their methods— you'll get some good usable ideas.



The Limited-time Sale

The sale held for just a few hours a day is not a new idea. But in recent years it has enjoyed a new lease on Me. Its newer forms include: (1) 10minute specials, (2) noon-hour specials, which are popular as a method of attracting noon-time shoppers, (3) after 5 P.M. specials, which are aimed at the nocturnal shopper. Years ago, the limited-time sale was held usually early in the morning to get shoppers out early. This sale doesn't work well anymore—also, retailers now reason that the best time for a sale is when traffic is naturally heavy, not when it's light.
Check the Ordering Procedure on Fast Movers

A national research organization which checks retail inventories in a substantial number of stores made a particular study recently of the ordering procedure of certain retailers for 22 fast-moving items. This research organization reports that "the per cent of sub-normal orders on these 22 fast movers ranged from 23 per cent to 66 per cent." The study goes on to report that "the average fast-moving brand is regularly or generally ordered in sub-normal quantities by at least 17 per cent of these retailers." Clearly, subnormal buying means understocks or out-of-stocks, increases handling costs, cuts down on display, and in general tends to reduce volume on these fast-moving lines. When proper orders for these fast movers are placed, the advantages include: lower buying and stockhandling costs, earning additional discounts, better display which means better volume, a curtailment of understocks and out-of-stocks, better customer satisfaction, and larger average sales.
Are Assortments Growing Too Big for Self-service?

Retailers are finding that, under self-service and self-selection, there is a maximum size beyond which it is uneconomical to expand a department. Their experience proves that departments with assortments that are too large confuse the shopper. This point is being overlooked and is consequently slowing turnover, upping costs. Departments that are even larger under self-selection than they were in the days of competent clerk service are apt to show poor results. One merchant who made a stop-watch study found that customers were taking too long to make up their mind—and, as a consequence, his average sale was declining almost as rapidly as he enlarged his assortments. There's a point of diminishing returns in assortments under self-service and self-selection—make a particular point of finding it, classification by classification.



What Is Your Return on Your Investment?

The percentage of profit on sales is the traditional method of calculating the retail profit performance. However, it fails to give a true measure of how the retailer is putting his capital to work. The real yardstick of retail success is total return on invested capital. Generally speaking, retailers do not obtain the same percentage of return on invested capital obtained by manufacturers. But there are exceptions—one of the great soft-goods chains, for example, reports a return of 18.28 per cent, which tops the 16.9 per cent figure of a hugely successful manufacturer like General Electric. But for too many retailers the figure lurks around the 7 per cent to 10 per cent range, and that just isn't satisfactory. Incidentally, here is where some of the large discount chains shine—their percentage of return on invested capital in some cases exceeds 30 per cent! To improve return on investment, some retailers are divesting themselves of real estate, accounts receivable—leasing fixtures.
Getting Customer Comments on Salespeople

It isn't too difficult to induce customers to complain about salespeople —but getting customers to help pick out superior salespeople is something else again. Here is how one retailer turned that trick—and quite simply, too. For a period of one month, this merchant included in each package that left his store—either take-with or delivered—a C.O.D. post card. The customer didn't know the card was in her package until she got the package home and opened it. The card requested the customer, if she had been pleased with the service she got from the salesperson from whom she made the purchase, to please mail in the card with her comments. (The name of the salesperson was already on the card.) An amazing 40 per cent of the shoppers actually filled in and mailed the cards—proving that so many people like to hand out praise. Of course there were also criticisms; and these were of value. But when the customers were informed by the card that the store wanted to find its ten most courteous salespeople—the shoppers really extended themselves to help pick the "ten best" And, of course, the "ten best" were properly rewarded.
The Snack—the Break—as a Traffic Builder

For those stores in which shopping is a bit more leisurely, the coffee break and the Coke break are becoming remarkably common. In fact, the coffee break has been used to encourage morning shopping in food supers —where shopping is not exactly leisurely. This nation has developed an amazing addiction to the coffee break in factories and offices—it is just



becoming established in retailing for the shopper. But these "breaks" will not for long be limited to coffee or Coke. The "snack break" is on the way. It's being used right now in some appliance stores as part of range demonstrations; it's long been popular in food demonstrations in food supers—and, actually, the fountain in the drug store is part of the snack break tradition with the difference that here the shopper pays for the snack. In any event, both to bring in traffic and to hold traffic longer, both food and drink are coming up as promotional devices. Call in the chef, or the automatic coffee maker!
Everybody Wants One Good Year

Deep down inside, almost every adult has a vast yearning for "just one full year when I'll have no problems at all." (Actually, this is really the basis of the sabbatical year for college faculty members.) Whatever the public dearly wants is always the basis for a good retail promotion. Therefore, several retailers have staged—with remarkable results—customer contests based on the reward to the customer of "The Best Year of Your Life." Under this contest, the customers win prizes of free rent, free food, free utilities, freedom from taxes, freedom from installment payments, etc. We're all captives for one economic reason or another. Hold out a promise of freedom for one year from economic woes, in whole or in part, and you have an appeal that will tug at the heartstrings of practically all customers. A successful pull at customer heartstrings is a good way to pull down the cash register keys.
How Often Should Windows Be Changed?

If you accept the premise that window shopping is on a large decline (more merchants come to this conviction each year) then perhaps it is time to review the schedule of window changes. Maybe a retailer who for years has been changing his windows every two weeks should change them every three weeks. Maybe instead of complete changes in all windows at fixed intervals, only certain windows should be changed as often as previously—and changes in other windows stretched out. Maybe instead of complete window changes there should only be part window changes. Maybe the present schedule of window changes should be continued only during peak seasons and a reduced schedule put into effect at other times. In general, window costs have mounted astronomically— while window shopping has plummeted. This seems to be particularly true in shopping centers, where window shopping is at an all-time low. But window schedules have become traditions, sacred cows. Try twisting that sacred cow's tail!



Torture Tests Dramatize Durability

Everybody believes that "merchandise ain't what it usta be." That may or may not be so—but merchandisers don't want that impression to spread too widely. That's why some retailers are featuring "torture tests"—these tests are real convincers! For example, writing on refrigerators or other appliances with ink, nail polish, iodine—to prove that a porcelain finish can take it. Torture tests for stretch nylons have proved highly effective. Carpets on the sidewalk—a real old-timer as ideas go—still pack a sales punch. Dream up some torture tests—you'll find that these dramatic demonstrations make effective promotions.
The Gala Opening Needs New Ideas

Gala store openings are proving to be hugely costly. They tend to attract riff-raff. They encourage pilferage. And the new store seldom is able to put its best foot forward. Merchants are therefore tending to tone down the Bamum-like events that had become popular in opening new stores. One merchant, opening a new store, used the following new idea with great success: in big-space newspaper advertising, he announced that "instead of having the customary gala opening night, we are presenting checks to the local humanitarian agencies for the amount we would have spent. We are requesting these charities to use this money to buy shoes for the poor children of our community. And we have asked our suppliers, instead of giving us conventional new-store-opening help, to send us checks made out to: 'A Pair of Shoes for Tommy.' These funds, too, will go to the local charities." There's more to the idea, but this is enough to show that it has great news value, that it is good public relations, and that it can bring to a new store all the traffic it really wants for an opening. After all, the object of a new-store opening is not to produce traffic jams—but to get the whole community to know about the new store. This idea does that very thing.
Challenge Traditional Expenses

For 30 years, one store had its windows washed on exactly the same schedule. Recently, it cut the frequency of window washing in half— reduced costs 50 per cent—windows remain just as presentable. Another store found it had been using several different dry cleaners for many years. It consolidated all dry cleaning with one outfit—cut costs drastically. A third store checked its repair account—found that tradition had built this cost up unduly. New planning techniques and better purchasing of parts, etc., cut costs. Moral: Once a year, challenge most of your traditional expenses, because they accumulate like barnacles. And remember—



when you fuss about small expenses, personnel becomes more aware of large expenses.
Convertibility—the Big Trend in Fixtures

Maximum quick-change flexibility is the great trend in floor fixtures. Convertibility is the key to present thinking—indeed, some tricks of the theater are being studied to learn more about "quick change." Merchandising has been tailored too much to the floor fixture—now the fixture is being so designed that it becomes the servant, not the master, of merchandising. A face lifting, a new appearance can now be given overnight to a small department or to a whole floor: no shutdown, no loss of selling area, no loss of time or volume. Show-window flexibility is now being applied to store interiors—a splendid trend.
Cutting the Return Percentage

Every check ever made proves that at least 50 per cent of returns are directly due to store errors and misunderstandings. For example, studies show that some salespeople consistently have high returns; others have much lower. Since the customers of both will average the same, the source of the trouble is the salesperson. One store arranges for low-return salespeople to work closely with high-return salespeople—the latter thus learn by example. Incidentally, every store and department has a certain number of "return-happy" customers. They usually total about 10 per cent of the customers—and account for as much as 30 per cent of the returns. They are always loss-producers. Weed them out—freeze them out
Misleading Customer Guidance

A large specialty store has a Customers' Council—it meets once a season, and it makes good use of the privilege of free criticism. A large food chain gives its customers a "report card" to fill out which enables shoppers to record what they think of the store's service, merchandise, variety, cleanliness, etc. Other stores have Customer Suggestion Boxes. The customer may be in the position to offer constructive guidance to the retailer —but, unfortunately, most of the systems used to ferret information out of shoppers tends to supply misinformation! The voice of the crank, the voice of the "lunatic fringe" of shoppers, tends to dominate. Also, when criticisms are improperly encouraged, the shopper tends to "manufacture" them. Give your customers a voice in your operation—but do it with modern scientific research controls. A Customer Suggestion Box, for example, can be filled with totally misleading reactions, entirely untypical of how the majority of a store's shoppers feel. A Customers' Council may have as members women who may represent society or top career women, but not the mass shopper—and the uncontrolled reactions of its members may



be entirely false. When you bring in the customer to supply information —be sure also to bring in competent research guidance.
Shoppers Buy Faster, Faster, Faster

In food stores, shoppers average only 17.9 minutes in choosing 12 items, about 90 seconds per item! In drugstores, the majority of shopper selections are made in just under two minutes. In hardware stores, the majority of shopper selections are made in just under three minutes—especially if the store is set up for self-selection. Home furnishings stores know that the family that used to take six months to decide to buy a rug, or an occasional piece of furniture, will now come to a buying decision in a few days. Young couples furnishing a home will buy complete furnishings in just a few days of shopping. Traffic appliances are bought in a matter of minutes; major appliances take only a few minutes longer—check any discount house! The whole tempo of shopper buying is constantly speeding up. Is your store laid out to help the shopper buy faster, faster, faster? And, once the purchases are made, can the shopper get the purchases wrapped, paid for, and out of the store without a moment wasted? The faster the shopper can buy—the faster the turnover.
The Preteener Becomes More Important

The more prosperous our masses become—the more important their youngsters become to retailers. Our current prosperity has fostered special permanents for children, special furniture for children, special foods for children of various ages, and special phonographs and radio sets for children. The preteen age was never so important, marketwise, as right now. They have larger allowances. They are indulged, pampered, petted —more than ever before. And they are listened to in family purchase confabs. Tune in on the preteener; she and he are becoming quite a market.
Scatteration vs. Concentration with Suppliers

Just as a ship acquires barnacles—so do most retail operations acquire an excess of suppliers. And the result is the same in both instances—a slowdown. Most retail stores could cut their resources by 20 per cent— and cut costs, speed turnover, lower markdowns. Indeed, in certain departments, suppliers can be cut 50 per cent! Resource concentration need not involve a loss of volume—to the contrary, the more efficient merchandising it makes possible can achieve a volume increase. From hard goods to soft goods, from major appliances to hosiery—every inventory study discloses an uneconomical excess of suppliers. Scatteration too often is resource practice, if not resource policy. How long since you made a ruthless reexamination of your suppliers?



How Well Does the Shopper Know Your Price Lining? Talking about store statistics—a real sacred cow is the price lining record. Retailers know their price lines intimately. They assume the customer does too. But, with the exception of a limited number of price-fixed stores, the customer has only the foggiest notion of the pricing points of most retailers. Any number of retailers sacrifice precious markup points in order to maintain price lines—whereas the fact is that in more instances than otherwise, the shopper would not be even dimly aware of moderate changes in price lining. Add 20 Per Cent to Your Selling Power New display and fixturing equipment could add from 10 to 30 per cent to the selling power, as well as the selling space, of many stores— including some stores that "modernized" as recently as three to five years ago. There are few better ways to overcome high rental costs. One of the modern objectives is to get more, ever more merchandise out on open display—to keep less and less in reserve stock where it serves no selling purpose. Outmoded fixtures are "stealing" millions of dollars of potential volume from retail stores. (Here is a greater loss than from shoplifting!) Even our largest retailers do not write off outmoded fixtures as rapidly as a manufacturer will write off outmoded production equipment—yet store fixtures obviously are the retailer's "production" equipment. Probably 75 per cent of the fixtures in stores that are in business over 20 years are from 10 to 20 years old—and those fixtures are a terrible drag on retail volume. Informality in Shopping The fundamental trend of the shopper is toward informality in shopping. Women who never would have dreamed of going downtown, for example, in slacks, now don't give it a second thought. There is some question, however, whether the retail store—physically—may not be tending to go more formal, while its customers are going less formal. Too much uniformity and rigidity in store displays, decorative schemes that are too lavish, too much plush—these are the very opposite of the informal atmosphere that currently appeals to the shopper. The younger generations in particular loathe formality—and they are the big buyers. The atmosphere of too many stores suits the middle-age owner—instead of his younger customers. Free-trial Plan Is Spreading An electric razor offers a free-trial plan. So does a maker of electric blankets. So does a cookware brand which offers a 30-day free trial. Re-



tailers who have promoted these manufacturer-planned free-trial plans have found them to be uniformly successful; returns have been tiny— volume from satisfactory to excellent. Some retailers are now testing freetrial plans on their own. There is no question the plan has a powerful pull and every experience indicates that the privilege is rarely abused. If it can be done successfully on electric blankets—where sanitary laws and the unit cost combine to present unusual risks—then it can be done in many merchandise classifications.
Using Sound to Sell

The use of public-address systems has had its ups and downs in retailing. They tend to drop in store popularity largely because of failure to use them properly. Customers have seldom been known to complain about them—and, on the other hand, when effectively used, customers buy because of smart vocal suggestions over the P.A. system. Too few stores with P.A. systems put the same brains, time, talent, etc., into the messages that go into their retail advertising—yet this is a form of advertising. Modern P.A. systems have been considerably improved. For at least some types of retailing, the idea of using sound to sell has a good deal to recommend it. And when thinking of sound—check into the "talking tape* devices—they rack up startling sales increases.
Go Distinctive in Your Packaging

When a customer walks out of your store with one of your packages under her arm, she's a walking ad for your store. Ever think of it that way? Why not make that walking ad as effective as your newspaper ad —always remembering that one hand washes the other; in other words, the more effective your walking ads, the more effective will your newspaper advertising become. Get a distinctive color. Get a distinctive design. Trade up your wrappings—and they'll trade up your store! Effective wrappings contribute to store prestige and customer good will. They identify the store. They carry the store's personality out to the streets, into the home. There simply is no excuse for a store to use plain wrappings, plain paper bags, plain boxes. Go distinctive in your packaging— and you'll be adding another plus to your promotional activities at a low cost.
An Idea for Anniversary Promotions

Perhaps the most commonly used idea in retail promotion is the anniversary promotion. It continues effective, but because it has been exploited so many thousands of times it needs new ideas. Here's a variation on the anniversary promotion concept that has been found to be especially effec-



tive in planning newspaper advertising copy: use the number of years of the anniversary as the basis of the promotion. For example, a jewelry store used that slant this way in newspaper copy when it celebrated its 35th birthday: "We've waited 35 years, for 35 anniversaries, at 35 Asylum Street, 35 seconds from Main Street to celebrate with $3,500 in prizes. We'll thank you 35 times for your patronage." And a home furnishings store featured its 46th birthday this way: In a large opening newspaper ad it offered a special group of items, valued up to $22, at $4.46. Another group of items, valued at $79.50, was offered at $46.46. A mattress was offered at 46 cents when purchased with any one of a specified number of other items; a $49.95 chair was offered for 46 cents when purchased with a specific group of sofas. There's a magic in figures, particularly in birthday figures.
Hard to Detect Partial Walk-outs

The shopper who "walks" without making a purchase is easy to spot. Not so easy to detect, however, is the shopper who completes only a part of the purchases she had planned to make, or having completed her shopping list left the store without being tempted by a related product or impulse item. In an effort to determine how much was lost to partial walkouts, one merchant stationed himself at the door and queried those exiting shoppers with one of the store's packages in their arms. His conclusions (from an admittedly far from scientific sampling): (1) only half of those who planned to buy more than one item, did so, (2) only one out of five who had planned to buy more than two items and actually bought two, bought a third, (3) not one out of ten had had a specific related product suggestion made to her, (4) slightly more than one out of ten stopped to look, handle, and occasionally buy an unplanned item on what could be considered pure impulse. The most common reasons given for failing to Complete her planned purchases: ran out of time or estimated that insufficient time remained to complete another purchase. Next, unable to find the wanted item or satisfactory substitute. And third, had developed some sort of "peeve" against the store.
Easier Department Identification

As stores get larger, and as merchandise becomes more diverse, the shopper needs more assistance in readily identifying departments. We are not talking here about departmental directories, centrally located. We are referring, rather, to techniques to be used at the department or section itself that help the shopper to locate it more quickly. These techniques include: (1) larger signs, (2) new types of signs, (3) different colors for fixtures, (4) different types of fixtures (uniformity of fixtures



definitely does not help shoppers identify departments). Several merchants have taken new salespeople and tested them right on the floor, after a few hours, to see how they locate departments. If they have trouble, so do customers.
Death of a Sale

There's a new reverse-twist technique for training and enthusing salespeople (one of retailing's gravest problems). This is how it's done. (1) A contest is developed offering small cash incentives. (2) The contest calls for salespeople to submit their entries for remarks to customers guaranteed to kill a sale! (3) Examples of such remarks: "Look around; you'll probably find it." "Someone over there will help you." "The difference between the $7.99 item and the $4.99 item, lady, is $3.00." (4) A double reward is offered when the remark guaranteed to kill a sale is accompanied by its other-side-of-the-coin twin; a related remark that will help make a sale. (5) All of the remarks are published for study by all the salespeople. (Obviously, this makes a game of a serious matter— and in this instance, that's probably the best technique; certainly preaching has accomplished next to nothing.)
Outpost Stores

When department stores began putting on their main floors midgetsized duplicates of upstairs departments, these second locations were called "outposts." That idea of multiple locations is now common among all types of retailers. But now a much more ambitious version of the same idea is taking hold; it involves an entire store as an outpost! Thus, department stores are opening specialty stores selling children's apparel, home furnishings, etc. Variety chains are opening separate stores for garden and outdoor supplies; ditto for some food supers. The mail-order chains are opening separate outdoor living centers. These "outpost stores" may be located several blocks or several miles from the parent store. They carry complete stocks—larger inventories than would usually be stocked in that department in the main store. They are specialty operations; and they are another sign of a growing popularity for specialty stores at the very moment that the one-stop outlet gets all the headlines.
Cutting Credit Costs

The time is approaching when nearly all stores will be offering very much the same type of credit plans. This suggests that before too long, merchants will join forces locally and offer one community-wide credit and billing plan—exactly as stores have consolidated delivery services on a community-wide basis. In the meanwhile, reports are cropping up of



noncompeting merchants cutting credit costs by combining their credit services. In one New England city, a men's wear store and a women's specialty apparel retailer, with combined annual sales of $1,000,000, have developed the following joint credit program: (1) Each store maintains its own identity; customers are not aware of the combined billing system. (2) Each sends out bills on its own letterheads. (3) However, they both use common machinery to address and bill, and use a common credit manager and credit assistant. The operation is based in a separate organization housed separately. Sample saving: a former cost of 17 cents for entering a sales or payment slip has been cut by one-third. It is estimated that this program will save each store well over $3,000 annually. Moreover, it permits store personnel to concentrate on moving merchandise.
More Fun for Shoppers

In the days of the old country general store, shopping was fun, entertainment. In the present era, shopping has become something of a bore, something of a chore. But now signs are to be seen heralding a return of fun for shoppers. A carnival atmosphere is being created deliberately in some stores. A large new store includes a pitch-and-putt golf course, a roller skating rink. Shopping center malls are offering a wide variety of entertainment ranging from strolling minstrels to a three-ring circus. Special novelty vending machines for children are part of the trend back to fun for shoppers. Fiesta programs are becoming popular. Clearly, shopping had become too austere; a return to fun was inevitable. On a big scale, or on a small scale, with a symphony orchestra or by serving coffee—give some thought to entertainment, to fun spots, to fun in shopping. It's a definite trend—and it appeals particularly to the family shopping as a group.
Merchandising the Second Home

Right now, at least one million families have a second home—usually a summer-week-end-vacation home. By 1975, there may be five million of these second homes. How are these second homes furnished? Usually with lower-price lines. Usually with furnishings that permit the most simplified housekeeping. Usually with furnishings that will stand up during the winter months in an unheated home. Appliances generally are of small size, not deluxe. This is a new form of home; and it is being furnished and maintained in a new way. Few merchandisers have even begun to cater to the owner of a second home (many of whom, by the way, are apartment dwellers for the major part of the year). But some-



day there will be special departments, special lines, for the second-home market. In the meanwhile, merchants in areas benefiting from the secondhome trend would be wise to begin planning inventory and merchandising promotion for the second-home market. (And that includes everything that goes into or is consumed in a home.) Rentals appeal to this market.
Faulty Price Marking—No. I Profit Destroyer

In many, and probably most, retail outlets, faulty price marking is currently at an all-time high. In many stores it clearly causes higher losses than shopper pilferage—yet for every ten merchants who worry about shopper pilferage (some of which actually is employee pilferage, some of which is poor inventory keeping, etc.) only one worries about errors in price marking. Of course, some faulty price marking results in overcharges—but the merchant seldom benefits from the overcharges for two reasons: (1) customers know prices pretty well, (2) the customer who may be "taken" eventually finds out, and there is a day of reckoning. But the customer who is undercharged may conclude that she is being offered a bargain. Checking a store periodically for price-marking errors may cost money—but in many stores it can provide returns of up to $5 for every dollar spent.
Personalize Those Signs

Personalized store signs for display on counters may soon achieve quite a vogue. What are personalized store signs? Well—they include signs with pictures and a few facts about the store manager, the department manager, the salespeople. Or the signs are done in a homey style—"hi neighbor" and that sort of thing. This is an interesting trend. Store signs have tended to be not only uninformative but also unimaginative; they have been dry, stilted, dull. Why not humanize them? Why not add a touch of humor, of informality? And why not use them to prod salespeople—a sign with a few comments about a salesperson may lift that salesclerk's desire to offer improved service.
Getting Motion Displays at Low Cost

Motion displays attract attention; no doubt about it. They are shopperstoppers. And, if the motion puts over a selling feature of an item, then it will not only stop the shopper but help sell the shopper. But motion, when it involves a motor, can be costly. Can motion be obtained at low cost? Yes—with such a simple device as an electric fan! Example: aluminum roof ventilators were set spinning in a window by electric fans. Attached to each ventilator section was a slipper. The motion put over



the message of cool summer footwear. Give some thought to the potentials of simple motion through an electric fan—in the window and in the store interior. It has innumerable applications, all of them inexpensive.
Do You Really Know Your Customers?

Most retailers "type" their customers. Their customers "insist" on suchand-so, will "never" accept this-or-that. Etc. And etc. In some instances, this could indeed be the case. But more often than otherwise, the customers of most stores are simply a typical cross section of American families. And that means they are not peas in a pod. Few retailers (great specialty stores would be an exception) have a "typical" customer; more often, retailers will have as many "untypical" customers as shoppers of the mold mentally fashioned by the merchant. Moreover, always bear in mind that there is no such thing as a "typical" woman or a "typical" man; they just don't exist. The moral? The moral simply is that maybe some merchants are limiting their efforts by lumping all of their customers into a single mold—and then merchandising to that mythical character. That is the road to slow turnover, to unbalanced inventories, to stagnation.
Display Props as Tests for New Items

A number of retailers have found that the use of a novelty as a display prop will often result in requests by shoppers for the privilege of buying the item. For example, a group of fascinating pixies were displayed at a hosiery counter; the pixies were there solely as display props. But they fascinated women, and the department head, who first promised to give the pixies to good customers when the display was taken down, later decided to put some pixies in as regular inventory. They have been moving well ever since. This, in turn, has led some merchants to conclude that one way of testing a new item, especially if it is a novelty, is to use it first as a display prop. If customers show an interest in that display prop as a desired item, then the number will usually turn out to have a strong sales appeal.
Lounge Areas and Facilities for the Family

More men are shopping every year. Yet rest room facilities for men are almost nonexistent in some stores, and are third rate in other stores. In some department stores, for example, a man can burst a kidney trying to find the men's room! In food supers, men shoppers usually must use the employees' rest room. But this is only half the problem. Most retailers today are trying to encourage family shopping. But how many retailers today have rest room facilities for the family—not to mention family lounge areas? Answer—too few.



The Midget Chain There are more retailers operating two-store and three-store chains than ever before. These midget chains aren't classified as "chains" by the Census Bureau. But it is amazing how many merchants, when a second store is suggested, will tend to respond: "We don't want to become a chain." Whether or not single ownership of two stores or three stores means that one is running a "chain"—it is a fact, nonetheless, that the concept of multiple-store ownership, in multiples of twos and threes, is clearly on the rise. Any number of downtown merchants now have a branch in a shopping center. As some cities have mushroomed, established merchants have opened a second store, or even a third store, in one of the new areas. It is probable that, within a few years, the "midget" chain may actually be operating more store units than the giant corporate chains—indeed, this may be the case right now! Have you considered a second store? Maybe you're overdue for that decision. And, if you decide on a second store, be sure to ask yourself whether it should be the spitting image of your present store—or different in certain respects to suit the new location. And bear in mind also that a "second store" could be a leased department that you operate in another store.
Needed: a Discontinuance Committee

The Buying Committee is common currently among larger retailers. It isn't generally known, however, that the Buying Committee occasionally functions also as a Discontinuance Committee. Thus discontinued items get systematic attention in some large retail organizations. Smaller retailers have the same need for systematic study of slow movers. Yet few smaller retailers devote the same studied effort to the process of discontinuing items as they do to buying new items. And that is precisely why so many inventories in smaller stores are burdened by dead numbers. This doesn't mean that retail inventories can be planned completely on the basis of cold statistics; some slow movers definitely belong in stock. But they must remain in stock not from force of habit, not because of tradition, not from failure to examine them closely and periodically. A one-man Discontinuance Committee, "meeting" regularly, and studying periodically prepared reports on slow movers, can work wonders with a sluggish inventory.
Slow Down Traffic—and Jump the Average Sale

In some modern stores traffic moves too fast. This is one reason shoppers are seen doubling back in their tracks—they've moved so fast they raced right by some needed purchases. And this is one reason why so



many shoppers buy only half as much on each shopping trip as they had intended. Slow down traffic (within reason, of course) and add to the average sale. How to slow down traffic? Well: (1) deliberately arrange for several partial "road blocks," (2) put some merchandise in bins, dump baskets, etc., on the floor—or close to the floor, (3) plan for interrupting notes in your aisle displays; it is excessive regularity that speeds traffic right past a sale, (4) put better selling copy on your signs; talking signs can talk shoppers into stopping and then into buying, (5) break up those mile-long bowling alley aisles, (6) use a variety of fixtures: different styles, heights, shapes, etc.—it's so easy to keep right on walking past several hundred linear feet of completely uniform displays.
Your Long-standing Customers

A retailer who recently celebrated his 25th anniversary invited his regular customers who had been buying from him for 10 years or more to help him celebrate. He had a special "courtesy day" for them—announced it in appropriate direct mail. There is no customer like a longstanding customer. If you have records of your year-after-year customers, why not stage an occasional promotion for them? If nothing else, they'll pitch in to help you celebrate your own anniversary.
Three Living Rooms

An increasing number of homes now have three living rooms—a rumpus room, a TV room, and the formal "parlor." What is more, when Washington invited a group of women to submit their ideas on what they'd like in a home—the three-living-room concept took top position. Indeed, with outdoor furniture becoming so popular, there is really a fourth living room: the patio, or porch, or garden. The more living rooms, the more furniture and home furnishings. The more living rooms, the more home entertaining, which means more food, drink, etc. The more living rooms, the more apparel—informal for the rumpus and TV rooms, more formal for the "parlor"; and, by the way, it is indeed a fact that the old-fashioned parlor is staging a comeback, even to its being out-of-bounds to the young fry.
Lighting Stores at Night

Where foot or auto traffic passing a store at night justifies the cost, special nocturnal lighting techniques (over and above regular lighting) when the store is closed are being found profitable. Too many stores use lights during closing hours merely for "protection." But lighting can sell when the store is closed—provided, of course, there is passing traffic on foot or on wheels. It can sell the store name and basic concept of the store; it can promote tomorrow's specials and draw attention to seasonal



items. One retailer designs displays specifically for the car traffic—lighted displays that can be taken in even though die traffic moves along at a good clip. Check off-hour traffic. If it warrants promoting to that traffic, then check night lighting and displays.
More "Live" Demonstrations

One of our largest appliance outlets makes it an unbreakable rule to have every appliance that is on its floor hooked up, ready to go. No matter what machine a customer may pause in front of—a salesman can give a demonstration, pronto. Some large department stores are stepping up demonstrations—from demonstrations on small housewares to tablesetting clinics. One department store reported recently that it had several hundred demonstrations of one kind or another going on at all times. Chains too are showing an increasing interest in live demonstrations. The demonstration is one of the oldest of selling devices, but it is just as effective today as it was hundreds of years back. Today more manufacturers are making live demonstrators available to retailers—and alert retailers are gladly accepting this form of cooperation.
You Can't Stop the Clock

Every so often, a new form of retailing appears—or, an established type of retailing goes into new merchandise categories. Anguished howls are raised by traditional merchants. But, in time, everybody becomes reconciled to the situation. Years ago, established retailers fought the mail-order houses, then the chains, then the house-to-house sellers. Years ago, established retailers fought the drugstore when it took on nondrug lines—they fought the variety store when it took on cosmetics—they fought the food store when it took on nonfoods, etc., etc. But neither the legal approach nor the intimidation approach has ever done more than delay the inevitable. Only a few years ago, retailing was up in arms over the discount house—today retailing is learning how to compete with the discounter. Competition is best met by competitive merchandising—not by legal entanglements nor by threats.
Getting Customers to Visit More Departments

The larger stores become and the more varied the number of categories stocked—the more difficult it becomes to induce the shopper to visit more, and still more departments. Here are some suggestions to achieve that goal: (1) Install a really dramatic store directory, soup it up! (2) Install other directories at many points throughout the store; this is seldom done. (3) Use humorous and attention-getting section markers. (4) Put in phones so shoppers may inquire concerning location of wanted section. (5) Drill your salespeople so they won't send shop-



pers off on wild-goose chases—and check them with your own shoppers. (6) Put up miniature directories of near-by sections at many spots, especially covering related merchandise. (7) Most important, have store executives shop the store periodically to determine their problems in locating merchandise—what they experience difficulty in locating, the shopper simply will never find!
Keeping Youngsters Happy while Parents Shop

A Kiddyville or Kiddy Corner or Kiddie Korral, designed to keep the youngsters content while Mom or Pop, or both, shop can have these benefits: (1) If coin-operated machines are installed, the revenue may pay for the space used. (2) Parents shop longer and buy more when not distracted by the children. (3) Housekeeping costs in the store are cut—one youngster on the loose can play havoc! (4) The display of toys, etc., nearby will usually encourage the parent to make a purchase either when leaving the child to shop or when returning to pick up the child. (5) Mothers who otherwise might not want to shop at all (the same applies to Pop) are more apt to come into the store when they know the children will not be a headache. (6) Adults with no children will be less annoyed when youngsters aren't under foot.
Public Service Windows

Since window shopping is on a decline—and since retailing has many community obligations—why not make it a regular practice to turn at least one window over to public service uses? This would include charitable, welfare, and civic projects. These windows will win heaps of good will, will attract unusual attention, will create considerable word-of-mouth conversation, and will make a deep impression, particularly on those more influential people who are the leaders in their communities and who mold local opinion.
Employee Incentives Gain in Retailing

In one field, the chains report that 65 per cent had profit-sharing plans for employees. Some 45 per cent had stock-purchase plans (although usually for executives rather than rank-and-file employees). Even the percentage of these chains running employee contests had jumped, over a six-year interval, by almost 50 per cent. In another field, the chains reported large increases in the number offering employees noncontributory group life insurance, hospitalization and accident-sickness insurance, retirement plans, etc. Where part-time employees of teen age are employed, plans are being developed under which a stipulated number of these teen-age employees are offered college scholarships. (Incidentally, these



special plans for teen-age employees are designed to provide a source of future retail executives.) There is a wide opportunity and a desperate need, in retailing, for brilliant thinking with respect to employee incentives. It is questionable whether merely duplicating what industry offers in so-called fringe benefits will be enough. This doesn't mean that retailing will have to be more lavish in its fringe benefits—but it will certainly have to be more astute; retailing will have to develop more ingenious plans, like the scholarship plan for teenagers.
How to Run a Suggestion Box System

Some stores report that their suggestion box systems for employees result either in empty boxes or in foolish suggestions. Yet many employees have good ideas. Here's a plan that will step up results: (1) Step up the prizes—$5 will no longer do the trick. (2) Six months or a year after an initial award, make a secondary payment where the idea has worked out well. (3) Put no upper limit on awards—if you ever get an idea worth $100, or $500, or $1,000 and publicize the payment, your employees will really search for ideas! (4) Act promptly on all suggestions —delays are deadly. (5) Indicate the type of suggestions you want— give guidance to your employees. (6) Publicize the payoff—regularly. (7) Be sure actually to use every suggestion paid for. (8) Permit employees to enter suggestions anonymously. (9) Hold an annual meeting of award winners. (10) Use handsome suggestion boxes—clever, humorous. And put a new poster on each box every month. The "Horrors" of Night Work Some retailers insist that they can't keep employees if the store is open at night—even for a single night. Yet some of our largest chains, employing many thousands of people, are open from 2 to 5 nights a week. And the gigantic Sears reports that approximately 30 per cent of its enormous retail-store volume is done after 7 P.M.! And Sears somehow manages to get people to work at night. Recently a large retail organization checked to find out what it was that prospective workers objected to about retail employment. It found that 21 per cent felt that compensation was too low, but only 3.9 per cent complained about night hours. The bald fact is that a substantial slice of our working population has many reasons for preferring night hours and perhaps Sunday hours, too.
Why Not Entertain Suppliers?

During the war, when merchandise was short, it was not unusual for retailers to entertain their suppliers. Now a large department store holds an annual luncheon meeting for certain of its suppliers. It's part of this



store's program of resource relationships. A personal invitation to the luncheon is extended by the president of the store. At the lunch, store executives outline one of the store's major promotions as an example of why and how this store moves merchandise in huge volume. Resourceretailer relationships do not constitute a one-way street. The best buys come to the retailer with the best resource relationships. And a store's most valuable assets can be its relations with its resources.
Promoting Twins

Something like one out of every 86 births is a twin. This means that in the trading area of every retailer there are many twins, and that twins are being born regularly in every retailer's area. Why not promote to the twin idea? Give something free to every set of twins born in the trading area. Offer to outfit twins for the price of one for a limited period. Arrange special free photos of twins. Put in a stroller for twins so the mother may shop in comfort. There's something irresistible to everybody about twins—and this automatically makes twins a splendid merchandisingpromotional opportunity.
Promotions for Working Wives

Among the younger families in your trading area up to 60 per cent of the young married women go out to work and the number of married women at work is increasing all the time. Astonishingly few retailers promote to the working wife. What a wonderful opportunity—wasted! Here's a woman who is a wife, maybe a mother, a housewife, a worker. She doesn't merely double in brass—she quadruples in brass. Why not an occasional newspaper ad saluting the Working Wife—the Working Mother? Why not announce special facilities for the shopping convenience of the working wife?
The Silver Dollar as an Incentive

The old silver dollar has staged a remarkable comeback as a retail device with a proved appeal both for shoppers and for employees. As a promotion, it has been developed in a variety of ways. As an incentive for employees, it has also received a variety of applications. Typically, one store ran an "Earn-a-Silver-Dollar" contest; each salesgirl who won a favorable shopping report was given a silver dollar. It pulled better than offers of larger sums! There is no doubt that the silver dollar has captured public imagination. And whatever captures the public imagination can turn even silver into gold! Give some thought to the silver dollar (look at the success Las Vegas has had with the silver dollar!).



When You Modernize, Tell the Public about It

Every retail store has a turnover of customers—customers who do not come back at all, customers who return less frequently, etc. When a store modernizes, the regular customers soon find out about it. But, if the modernization is to pay off, all former customers, all irregular customers, and all who never have been customers but who should be customers must be told about it. This is why so many smart retailers turn to newspaper advertising to tell everybody in their trading area about a facelifting job, about new fixtures, about new shopper conveniences. Every retailer knows that new merchandise has a powerful pull. But some retailers seem to be unaware that new store fixturing, new parking lot facilities, etc., can be made—through smart newspaper advertising—to exert almost as strong a pull.
Try Repeating Ads

Instead of worrying about advertising production costs—not to mention rate costs;—why not try repeating some newspaper ads? One retailer reports that during a single season he repeated the same power lawn mower ad weekly—and it sold mowers. Advertisers repeat radio and TV commercials—why not publication ads? Every check ever made proves that a competent ad will pull at least as well, and frequently even better, when used a second, third, and fourth time. An ad can be repeated as long as the pull is profitable, and this is something any retailer can check.
Better Display for Higher Price Lines

There is reason to believe that, in many merchandise categories, the shopper is willing to buy higher price lines in larger volume. But space and position in too many stores continue to be assigned to price lines as though there had been no change in customer buying habits for years. Every retailer who gives special display to larger sizes reports that larger sizes move well. Why not give extra display to higher price lines? Give them more shelf frontage, better position, and, above all, talking signs that will sell higher price lines. Retail profit comes from dollars, not from percentages. The more high price lines you move, the more dollars you take in. The cost per sale for a low price line is every bit as high as for a high price line. Public income has gone up faster than retail price lining. So has public taste. So has public sophistication. So has public desire to own better merchandise in order to achieve social status. Interestingly, one store reports featuring stainless steel flatware at both 97 cents and $1.69 per place setting for $5.00 worth of register receipts. Over a



14-week period, with a total of $70,000 done on both price lines, the higher price line outsold the cheaper by three to one! Snob Appeal—the Answer to Footballed Lines There is no one overall solution to the serious problem of footballed lines. But a number of retailers report that the shopper's mind can sOtaietimes be taken off the price tag by using the snob appeal. For example, in housewares this consists in putting in so-called gourmet housewares, some of which are imported numbers. These items have a strong socialstatus or snob appeal (remember when it was called "keeping up with the Jones's"?). More manufacturers are bringing out special lines priced somewhat above the mass market with this same objective in mind. Obviously, a store can go only so far with this plan—but, within reason, snob appeal items can function ably as a buffer in a price-footballing era. Bridal Promotions Cover Wider Merchandise Range Bridal promotions, which were once limited to a special bridal department, are now becoming multi-departmental promotions in larger stores. For example, the hosiery department is finding that not only can it benefit on hosiery from bridal promotions, but also that it can step up volume in that same department on boudoir slippers, frilly garters, etc. Of course in hosiery, particular emphasis is put on such novelties as handpainted stockings, a good luck penny tied with blue ribbon to a pair of sheer hosiery, etc. But the point we are making here is that bridal promotions now can be staged not only for a wide range of departments in a multi-department store, but also in many sections of specialty stores which did not traditionally consider themselves to be in position to tap the bridal market. Incidentally, in connection with the bridal market, while June is the traditional bridal promotion month, actually the number of weddings doesn't vary greatly month by month; every month lends itself to bridal events, provided there is smart merchandise, smartly promoted. Try Above-the-line Price Lining Price lining usually follows two traditional grooves: (1) It tends to remain at the same pricing point, year after year. (2) These pricing points tend to be below an even figure—$1.95, for example, rather than $2.05. But now a school of retail thought is growing which insists, first, that traditional price lining really is not sacred, and, second, that the new pricing point can indeed be fixed above the even figure and thus obtain a larger margin. As a matter of fact, a large discount chain—where pricing is obviously a matter of vital importance—recently tested a $4 figure instead of $3.99 and $5 instead of $4.99 and found that sales were not



affected one iota. But another discount chain reports that it has taken some items formerly marked at $1.74 and marked them up to $1.77; items formerly marked at $1.19 are now marked at $1.21. The amazing thing is that at the higher figures, sales have definitely been stronger! So—experiment with price lines, and, when you do, try going above the evenfigure dividing line. Here is where better profit may lie.
Don't Put Customers into Strait Jackets

Some retail stores are putting in one-way aisles. The same customers who are driven slightly mad by one-way streets are now to be driven a bit more mad by one-way store aisles. Other stores have porters working during busy hours—one such store puts up a sign reading: "Porter at Work—please allow ten minutes before entering this aisle. If you desire merchandise, kindly ask porter to assist you." (1) Why block off an aisle for even ten minutes—is this really necessary during regular floor hours, or economical? (2) Since when can a porter "assist" in getting merchandise for the shopper? On the one hand, retailers are putting in fixtures that will help to sell more through the "persuasion of convenience." Simultaneously, they think in terms of one-way aisles, etc., which add a bit of annoyance and even torture to shopping.
FREE for the Rest of your Life

One contest prize which fits almost any merchandise category and still enjoys an amazing degree of acceptance is one which offers the customer a free lifetime supply of the item. Best of all from the retailer's point of view, the cost tends to be surprisingly small in relation to the attention it attracts. The offer has been successfully applied by retailers to such diverse products as: shoes, washing machines, soap, sweaters, milk, hosiery, sun-tan lotion, carpeting, baby products, and many, many more. There seems to be almost no limit to the number of logical tie-ups which can be arranged.
Wasted Space at the Store Entrance

Old-time merchants looked upon the space at store entrances as the most valuable space in the store. This was where they featured their hottest specials; this was where they changed their offerings frequently. And here is where they sold more per square foot than in any other part of the store. In more recent years, the trend has been toward the "uncluttered" appearance at the store entrance—open it up, don't make the shopper's first impression as she walks in one of a cluttered store; these have represented the more modern merchandising concepts. And with check-out gates near the entrance in more and more stores, these concepts gained ground. But now a reverse trend is setting in—space at the



store entrance is once again being used for volume, to create the impression of a busy store, etc. Those first couple of feet into the store (which are also the last couple of feet when leaving the store) can boost volume —properly merchandised. Perhaps a bit less of the museum look at this point and a bit more of merchandising excitement might be very much in order.
Dig Up Those "Oldest 1 Models

A recent promotion brought in over 200 antique irons. It's amazing how many homes "never throw anything away." Promotions for the oldest electric refrigerator, oldest vacuum cleaner—and, on the soft-goods side, the oldest handmade bedspread—have proved highly stimulating. Also, the display of these old-timers usually brings in good traffic.
Impressing Suggestive Selling on Salespeople

For years—and years—many retailers have been trying to train and enthuse their salespeople to do a better job of suggestive selling; a better job of building up the average ticket. Here's an idea that worked wonders in that connection: (1) A retailer sent out each of his salespeople, in turn, to shop competing outlets. (2) In each case, they were given $5.00 and instructions to buy a specific item in the competing store. (3) They were also told, having bought that specific item, to buy anything eke suggested by the salesperson that could be financed by the approximately $4.00 remaining after the initial purchase. (4) One salesperson was sent out each week. (5) That salesperson then reported her experiences at a store meeting each week. (6) In almost every instance, the salespeople reported, each in turn, that they had not been asked to buy a solitary item other than the one which they had come into the store to buy! Clearly, there was no need to lecture those salespeople on the importance of suggestive selling. They sold themselves! And, in the two instances where the salespeople returned with the $5.00 fully spent, as a result of suggestive selling, their experiences pointed up, as a refreshing contrast, what could be done to step up volume through keen suggestions.
Odd-ball Pricing

Odd prices have, of course, been commonplace in retailing for years. Now the odd price is being improved upon—it has become the odd-ball price. What is an odd-ball price? Well, a fast-growing chain, now numbering over 100 stores, prices in 3s—starting with 3 cents. The 88-cent price promotion, which has been remarkably successful, is pretty close to being odd-ball pricing especially when applied to some items not usu-



ally considered to be near that price range. A variety chain manager reports that notions offered at 4 cents pulled loads of traffic. A promotion featuring stationery at 9 cents is another instance of odd-ball pricing. Offering yard goods at so much per inch is odd-ball pricing, so is offering floor coverings at so much per square foot. Smart pricing can work magic —and odd-ball pricing can be smart pricing. Teaching Shoppers How to Shop a Sale One of the great retail ads of recent years was run by a large department store. It was a full-page newspaper ad. Its headline read: "How to Get the Most Out of a Sale." It started off this way: "There's a technique to shopping a sale, especially when it's a big sale. So we're doing something perhaps never done before; we're giving a score of helpful hints and inside tips on shopping a sale." Then followed 21 suggestions ranging from wearing comfortable shoes to "We love children; but unless you're buying something for them to try on, it's a good idea to leave them home." Other ideas: "Start in the basement—work up in the store." "The best hours to shop are early in the morning or after 3 P.M." "Make sure you have your account card in your purse." This whole idea of instructing shoppers in the none-too-gentle art of shopping in newspaper advertising is a splendid form of institutional advertising, particularly currently when the shopper's ingenuity is challenged by complicated merchandise, complicated merchandising, and a time problem.
Cold-turkey Telephone Selling

In one Southern city, a Sears telephone order board with 44 operator positions assigns six operators to the sole function of making a continuing cold canvass among regular Sears customers. In other words, these telephone order girls phone regular customers to make specific shopping suggestions. Here is a retail giant, with a probable volume for 1962 of $4.6 billions, using the telephone not merely to receive business, but as a technique for going out and digging up business. It is an odd fact that this use of the telephone has tended to be monopolized by shady operators—starting with the promoters of blue-sky securities. Maybe because of this unsavory background, legitimate merchants have tended to steer clear of it But when a merchant like Sears sees nothing wrong in cold-turkey telephone selling—and finds it sufficiently profitable to justify devoting the entire time of six telephone girls in one area to the function—then maybe it is high time medium-sized and smaller merchants everywhere took another look at this phase of the rapidly growing technique of retailing via the telephone.



A Program to Reduce Returns

Most retailers have a "grin and bear it" attitude toward returns. One merchant, whose grin had disappeared, declared war on returns with considerable success. His program: (1) Analyze all returns to determine the real reasons for dissatisfaction. (2) List the most common reasons— display these at every cash register, in every sales book. (3) Offer a small prize for the salesperson with the best returns record. (4) Give special instruction to salespeople with bad returns records. (5) Select a single basic cause of returns for a mass attack; keep hammering away at it until a major reduction in returns from this cause has been achieved. Then switch to another important return causing factor. There will, of course, always be returns but this program offers hope of keeping the problem well fenced in.
Check List for Rear Entrances

New parking lots in many downtown areas, and parking lot expansion in many suburban retailing locations have brought a new importance to the rear entrance. While the rear entrance may seldom see as much traffic as that which passes through the front door, it still represents a traffic-building approach which can't be neglected. A recent analysis of customer complaints regarding rear entrances suggests the following check list for rear entrance merchandising: (1) A really big sign should identify the door as a "Customer" entrance. (2) Get trash undercover and out of sight (3) Keep the area clean. (4) Fresh paint will add a lot of shopper appeal. (5) If there are steps, add a hand rail. (6) A small display window goes a long way in getting across the idea that this is a store with merchandise to sell. (7) If there is a corridor from the rear entrance to the selling floor, keep it clear of crates, cartons, etc., and again, a little paint can be very effective. (8) Be sure the shopper doesn't have to pass through offices or other areas where behind-the-scenes operations are in progress. (9) If a check-out is used, be sure the customer can leave, as well as enter, by the rear entrance.
Letters to the President

Many people would find it appealing to correspond with the president or owner of a business. With this in mind, a chain inaugurated a Letter to the President program. The plan worked this way: (1) A postagepaid reply card was put into holders throughout the store. (2) The cards were self-addressed to "The President of Blank's." (3) Customers could fill out the cards and hand them to employees or mail them in. (A check showed that 98 per cent of the cards returned by shoppers were mailed



in.) (4) Customers were invited to offer suggestions or to make criticisms. (5) Each card received was answered presumably by the president. (6) All complaints were carefully studied; several contained excellent ideas. (7) Fine ideas were found also among the suggestions advanced by shoppers. (8) Although no incentive had been offered, when a usable idea was received, the shopper was given a merchandise credit of $5.00. (9) A bulletin listing many of the suggestions was eventually mailed to all who had sent in a card. (10) Finally, a short letter on presidential stationery was sent to all who had mailed in cards thanking them for the excellent results and promising to try the same program again in the near future.
Slow-hour Activities for Employees

For as long as there is a retail business, there will be slow hours. To a very great extent, how those slow hours are filled will determine the success of a retail operation. Aside from "housekeeping" here is a partial program for filling those slow hours. (1) Prewrap fast moving items and pre-gift-wrap popular gift items. (2) Develop your own multipacks for items which frequently sell in multiple units and band together logical related items into a single sales unit. (3) Try developing and pricing logical assortments of merchandise to boost the average sale. (4) Prepare related merchandise tags referring the customer from one item to another. (5) Prepare detailed information tags for as many items of merchandise as possible to help answer customers' questions at times when the sales clerks are too busy to answer them personally.
The Ail-American Note Stages a Comeback

Simultaneously with the strong emphasis on imports—and maybe because of the many promotions on imports—some stores are taking the opposite tack and staging all-American promotions. There is clearly a strong surge of nationalism in the air—which makes the all-American promotion just that much more timely. One store staging such an event arranged for three of its windows to function as small shops—customers actually walked into these windows which included a penny candy store, a barber shop, and a silent movie house. Another store staging a "Salute to Americana" event showed a history of baseball display valued at $60,000. A Dixieland band performed from the store's marquee. Fivecent cigars and hot dogs were sold; the tea room featured dishes such as Yankee pot roast. The event was publicized in red, white, and blue. Shades of George M. Cohan? Could Yankee Doodle Dandy be due for a comeback? Maybe so.



Retailers Going for Two-fers

Some years ago, the food super found it could increase volume and step up the average sale by offering both food and nonfood items in sale; units larger than those packed by suppliers. They offered two of an item three of an item, etc.—and frequently they banded the multiple item: themselves. Now low-margin retailers are finding that the same principle is effective both in conveying the low-price image and in building up the average sale. Interestingly, some low-margin retailers report that they have cleared out some slow movers, originally priced at $1.49 each, by banding them in units of two and offering two for $2.99! Another varia tion of the two-fer concept is "one for $1.98 and one free," which, of course, is a variation of the traditional one-cent sale event. In any event the multiple-unit pricing is being given a real whirl in low-margin outlets which pretty well assures that many other retailers will also make increasing use of it.
Give a Mystery Sales Pitch to Street Traffic

Loud speakers blaring specials out on the street are hardly desirable —yet many merchants would like to be able to give a sales pitch to street traffic. One soft-goods outlet solved the problem neatly—in this way: the window displayed a fabric line for home furnishings. Outside the window, the store installed a large button. That button was connected to a record player hidden in the window. Shoppers were invited to press the button. When the button was pressed, a muted sales talk came over a loud speaker. Four different two-minute recordings were used. The sound could be heard only in a limited area—the "commercials" were highly effective—few passersby could ignore the invitation to press the button, and sales in the department left no doubt that traffic had been detoured into the store. (A hidden microphone made the promotion even more appealing.)
The New Magic Hour in Retailing: 4:30 P.M. to 5:30 P.M.

Alert retailers know full well that the noon hours have mushroomed into peak hours in many areas—women and men at work, in suburbs as well as downtown, find noon hours to be convenient shopping hours. But it is only more recently that some retailers have suddenly realized that 4:30 P.M. to 5:30 P.M. is also a busy hour—and for exactly the same reason; women and men find this hour to be convenient for shopping while on the way home from work. Men are doing an amazing amount of shopping starting at 4:30 P . M. Naturally, it is the young married couples in particular who find the noon and late afternoon hours to be fine for shopping—especially when both man and wife work (and this



is true of over 50 per cent of young marrieds). Of course, this is splitsecond shopping—so set up to provide quick service, not only during the noon hours, but also between 4:30 P .M. and 5:30 P .M.
Tape Record Salespeople in Action

Most sales training programs aimed at improving the efficiency of working salespeople fall short of success because they are unable to relate the training message to the selling situations the salesperson is familiar with. The training message is too often general and impersonal when it should be as highly personalized to each sales clerk as it can possibly be made. One technique to accomplish this is to tape record the salesperson in action, and then in a private session, and use the recording as the illustrative material of the training program. A store which tried this got their selling people to agree to the recording in advance—they knew when the recording was being made and were at their selling best. They also knew that the recording would not be used to embarrass them in a group. The tape was listened to only by the clerk and the executive in charge of training. Our Policy Is _________ It is unusual for a day to go by when someone doesn't say without blush or apology and in unequivocal terms, that our policy is such and such, or so and so. His statement can't be challenged because store policy is rarely available in written form. Even where it is, it is seldom available for the guidance of rank and filers, and still more seldom reviewed to see if the policy actively supports the image the store is trying to create. One large store set up a group to collect all these "our policy is's," throw out the old ones, the silly ones, etc., and assemble them in sensible written form. The store now has a policy manual—every employee has one. The foreword to the manual is a statement as to the image the store is trying to create. Suggestions for additions and deletions were solicited from everyone and submitted to a policy review committee headed by the store president. Here's a real awareness of the fact that "policy" in a fast moving retail operation must also be dynamic and fast moving. Flagging Down the Impulse-motorist Auto traffic is store traffic for most retailers today—provided the auto traffic can be slowed down. Once the attention of the motorist is flagged, then the impulse-shopper may be snared (as differentiated from the motorist who had planned to stop). This problem is simply an extension of that bygone era when the retailer planned to stop passing foot traffic; now it is passing car traffic that the retailer aims at. The pylon was one of the original devices used to flag down the motorist susceptible to the



impulse-appeal to park and shop. But now there are so many pylons, that the pylon itself must be given more drama. Size will help; pylons of gigantic Bamum-type size are now coming into use. Extraordinary colors, with changing colored lights, are a more modern refinement. And pylons that actually move (a drugstore used a giant mortar and pestle as its pylon and that pestle actually moved up and down in the mortar!) are still more effective.
After-hour Events

Sell when the store is officially closed? Why not. How? Like this: a specialty store contacts the personnel director of local corporations. With the latter's aid, employees of the corporations are given tickets to attend a dinner and fashion show. Models for the fashion show are employees of the cooperating corporation. Ten door prizes, with a $500 retail value are given. The entire event is staged in the store. A skeleton crew is on tap to make sales if desired. But the main object is to make friends, create favorable conversation.
What Percentage of Volume Is in Sale Merchandise?

It is an interesting fact that few merchants have ever established a volume figure for sale merchandise beyond which it would not be wise to go. Indeed, not many merchants know what per cent of their dollar or unit volume is in sale merchandise. A large manufacturer of foundation garments found after study that in this merchandise classification, about 10 per cent of the year's volume can safely be done in sale merchandise. Says this manufacturer to retailers: "If sale goods exceed 10 per cent, you are headed for trouble." That 10 per cent figure obviously does not apply store-wide in all types of stores. But it would surely profit most merchants to compile figures that would disclose the per cent of total volume done on sale merchandise—and then to do some astute thinking about these figures. Incidentally, this same manufacturer also found, after studying detailed figures in many stores, that on this category, holding more than two sales a year clearly resulted in taking away business instead of adding to it. Which goes to prove all over again that too much of a good thing can be just too much!
Try a Thoughtful Giveaway

Decades ago, the customer buying a man's suit found a few extra buttons in the pocket, in a boy's suit an extra swatch of material "for a patch." Recently, a hard-surface floor covering merchant reported that leaving a free pint of wax with a customer, after laying down a floor covering, yielded an amazing amount of good will. He said that customers talked about it to their friends, that it definitely brought in business. A smart,



logical giveaway can indeed work wonders. It need not be expensive. But it should represent a thoughtful gesture—wax for hard-surface floor covering is being thoughtful. Thousands of merchants have giveaways. But too often the giveaways have no significance, they mean nothing, they accomplish nothing. It is when the giveaway impresses the customer with the merchant's deep desire to be of helpful service that it accomplishes its purpose. (A druggist who spots a new father in his store makes a gift of a packet of cigars.)
Clinics for Customers

A furniture and floor coverings retailer holds a Carpet Facts Clinic for customers. Members of the panel are experts furnished by manufacturers. Door prizes are offered to stimulate attendance—a typical door prize is a $100 cash donation to the charitable organization which has the largest attendance at the clinic. Manufacturers usually donate the other prizes. From home furnishings to food is a long jump—but cookery clinics have been operated with considerable success for years. As we have more shoppers who have had higher education, the demand for information grows in proportion. The clinic for customers consequently promises to become a more common promotional device. It can be run effectively by medium-sized merchants!—its cost is nominal.
Relate, Relate, Relate

In a self-service, self-selection, impulse-shopping era, the principle of related merchandise display becomes of paramount importance. Yet one of the makers of sunglasses reports that he has had considerable difficulty persuading retailers to display sunglasses along with sun lotions, sun salves, etc. Yet that spot is so logical for sunglasses. Translate sunglasses into scores and even hundreds of other merchandise classifications and the principle remains the same. Every retailer should be experimenting constantly with related merchandise displays—it is amazing how few merchants bring together even such obviously related lines as men's shirts and ties, or coffee and coffee makers, or disposable tissues and cosmetics. But the potential for larger average tickets is even greater when the merchant dreams up unusual yet thoroughly logical related-item displays. (One large retailer offers special incentives to his salespeople for suggestions for related-item displays; he gets many good ideas this way.)
The Bra of the Custom-made

Merchants in a number of fields have an opportunity for highly profitable volume in the very definite trend among many families today to seek out so-called "custom-made" numbers or lines. The enormous popularity of antiques is really a part of this shopper trend—antiques are closely



related to custom-made, if not actually custom-made. This may be a flight from automation, from mass-produced lines, from too much identical merchandise. It may be another effort to achieve social status. It may be a sign of an affluent age. Whatever the cause—there is unquestionably a strong move toward the custom-made. These lines are not found in low-margin outlets—as yet. They are seldom stocked by the chains. Only a small number of department stores stock them. Yet the demand is rising—and, of course, the margins in these custom-made numbers is excellent.
Don't Be Misled by Family Income Statistics

It's easy—too easy—to be fooled by family income statistics. For example, merchandisers will tend to conclude that only families with a stipulated minimum income can buy a certain big-ticket item. Yet every analysis of big-ticket sales has shown that many families have a fantastic ability to undertake sizable purchases (the auto agencies learned this lesson years ago). A recent check disclosed that the bulk—yes, actually the bulk—of major appliances are bought by middle- and low-income families—not by families above the middle-income line. Hidden sources of income and multiearners within the family are just two reasons explaining this remarkable ability of so many families to confound the slide-rule experts.
Intrastore Competition

Most stores reserve their competitive energies for slugging it out with the competition, but now and then a merchant comes up with a scheme which channels the sharpest competitive energies into an intrastore fight. It's often difficult to arouse the latent competitive instincts in salespeople when the "competition" is some poorly known store down the street. Bring the "competition" right into the store, however, where each salesperson can see it in action and keep track of its progress, and then watch their competitive instincts emerge full blown. One technique is to divide all the sales personnel into two teams, set volume goals for each, and award prizes to the team which exceeds its goal by the widest margin. A bit of in-store hoopla with big thermometers indicating the progress of each team keeps interest high. The prizes can be very simple: often just a fun thing like having the losing team serve the winning team a breakfast, or taking over the opening and closing chores for a week. In many ways, the prize is incidental since winning is a reward in itself.
Store Identity vs. Store Image

The barber pole identifies the barber shop, but it doesn't convey any concept of what sort of barber shop is identified by the striped pole. That



pole is a store identity, not a store image. There, in a nutshell, is the difference between store identity and store image. Why is it important to note the difference? Simply because so many retailers establish a symbol that identifies a store—and think they have simultaneously acquired a store image. A big variety chain, for example, recently adopted a very handsome symbol to be featured in all its stores, in its advertising, etc. But this isn't a store image—that variety chain really doesn't have an image because its stores look almost exactly similar to all other variety chain stores! A store image must be based on a store's personality—and a store cannot even begin to create a store image until it has created a policy and program that achieve a distinctive personality in tune with its customers' preferences.
Single-brand Emphasis Develops Store Personality

In most merchandise categories, a single brand can be counted on to give a lion's share of the total volume done in the category. Many retailers have concluded that it will pay to earmark this brand for special emphasis on a continuing basis, even if this policy works to the disadvantage of competing brands. They reason: (1) The routine display of multiple-brand inventories is visually monotonous. It cannot be distinguished by the shopper from the similar display of any other retailer willing to carry the same inventory. (2) Periodic rotation of brand emphasis dissipates the promotional dollar; carry-over effect from advertising is watered down. (3) A policy of brand scatteration leaves the shopper with no lasting impression of store personality; the store does not stand for specific items or brands. (4) The selection of a single top brand for incessant hard promotion may help avoid the look-alike appearance of many stores.
A New Form of Shopper Service

Usually they are referred to as "Courtesy Booths," but name variations include: service desks, accommodation centers, and convenience booths. They all, regardless of their name, have similar functions. Specifically, they make available to the shopper a range of services not normally available in the store, or which were formerly scattered in many locations about the store. They attempt to reduce the time shoppers spend on "chores" so that more time may be spent on shopping. And obviously, every shopping minute saved is worth its weight in dollars. One of the forerunners of today's "Courtesy Booth" was the desk at which customers could pay their utility bills. Most still arrange for the payment of these bills, but today's wide-ranging services also include: check cashing, opening charge accounts, postage machines and a letter drop, stamp or premium redemptions, money orders, merchandise information, baby-sitting



registers, menu planning and party ideas, etc. When in doubt, shoppers are turning to the Courtesy Booth, and with this kind of impetus, the Courtesy Booth will become immeasurably more important as time goes on.
Needed: a Bigger Plunge on New Products

Each year new products form an ever larger part of total retail in almost every field, and the trend shows every indication of accelerating still further. Despite this, the last decade has shown but little change in retail policy as regards the purchasing or the promotion of new products. New items are still, almost without exception, under-bought and underpromoted. They almost never get the same careful attention that old staples do. Out-of-stocks and understocks of new products are at an appalling level. The situation is excused on the grounds that "risks" are reduced. A bigger plunge on new products—the taking of longer risks— however, may be warranted. Here's why: (1) new products draw traffic out of all proportion to the inventory investment, (2) new products provide a store with a major source of merchandise "news," (3) new products add immeasurably to the store's image for smartness, alertness, and awareness of shopper needs. Every retail operation accepts the burden of some slow movers, some low-profit (or even loss) items, and some "headache" items on the theory that these items make a contribution to the entire store or department that can't be measured simply in terms of turnover, net profit, or convenience. New items, on the other hand, are expected to pay their way almost from the beginning, although the "fringe benefits" may far exceed any possible dollar profit. Perhaps it's time to reexamine new-product proposals in terms of the contribution they may make to the entire store operation, and perhaps this will justify a bigger plunge on new products.
Deliver to the Customer's Car

Variations of the pick-up station, which make it possible for customers to have purchases delivered directly to their car, are destined for huge expansion. Many supermarkets have found such a system an indispensable part of their business. Now retailers in other fields are arriving at the conclusion that a similar system would prove advantageous. Behind this conclusion are certain facts. First, delivery costs are rising and efforts to pass these costs on to the shopper have been indifferently successful. Second, where shoppers do carry their purchases, physical discomfort quickly forces a halt to further shopping. The compromise alternative is to eliminate the necessity for shoppers to carry their purchases, but still provide their own take-home service. Within a few minutes of the



time a purchase is completed, the package is delivered to a parking lot pick-up station. All the shopper carries is a small numbered ticket. When all her shopping is completed, the shopper returns to her car, drives up to the pick-up station, hands in her tickets, and has her purchases placed in her car by an attendant. Club Plans Galore Clubs of almost infinite variety—stocking clubs, teen clubs, coffee clubs, menu clubs, appliance clubs, etc., and etc., are emerging as a highly potent merchandising weapon. Generally they are based on items, or in departments where repeat sales may logically be expected. In return for repeat business, they confer special privileges on the shopper. Sometimes these are in the form of free goods, but more often, they involve shopping conveniences such as preintroduction shows, special credit facilities, special personal attention, first chance at specials, and merchandise news letters. The club plan offers the store an opportunity to combine image building with a substantial return in terms of sales dollars. "Free Check-up" as a Traffic Pull In electric housewares, a number of retailers have experienced excellent results with "free check-up" events. For example, one such event offered a free check-up and oiling service on food mixers—plus the gift of a $21 hand mixer to the owner of the oldest electric mixer brought in for servicing. Shoppers were also invited to enjoy a cup of coffee. The event included a food expert who demonstrated small appliances. One customer who came to the event bought a $125 power mower! The same idea has been used for electric shavers, for automatic lighters, for small power tools. As a matter of fact, variations of the idea have been used in art needlework events—so the idea is as much at home in soft goods as hard goods. Vending Machines outside the Store It is now generally accepted that the true age of automatic vending is about here. Tue automatic change-maker, the vending machine that can accept paper bills, vending machines that are just about impervious to the climate, the entry of giant corporations into the production and leasing of automatic vendors, the self-service age, fast shopping, presold brands—all conspire to underscore the forthcoming rapid development of the vending machine. There is no reason why this supplementary form of retailing should become an "exclusive" with giant retailers. Small gas stations have done well for years with Coca-Cola dispensers, cigarette dispensers, ice cube dispensers, etc. Now is the time for innumerable



types of independent merchants to experiment with the automatic vendor —especially outside the store, and especially during the hours when the store is closed. Since these automatic vendors are usually installed on what is really a "leased department" arrangement, there is little element of risk involved for the retailer. Take a good look at the automatic vendor —and then take at least a first step in this direction.
Accelerated Clearance Events

A number of major stores have successfully reduced the time needed to move the bulk of their clearance merchandise to a fraction of the time previously required. The technique used is a superspectacular limitedtime sale. The event is limited to a few hours during which the store is normally closed. Personnel are massed on the selling floor to handle unusual loads. Merchandise is pre-prepared to cut the time required for selling and the completion of the sale. Informative hang tags, preprinted sales slips, special provisions for carry home, all speed the sales pace. Naturally, the big appeal is based on price and an unusually intensive promotional outlay is required. This cost is distinctly worthwhile, however, if a really substantial portion of the old inventory is moved out
Mobile Fixtures

One of the inherent weaknesses of some modern self-service and selfselection fixtures is that they are not sufficiently flexible. In particular, with too many of these fixtures, the fixture itself is firmly fixed to the floor and cannot be budged. Some retailers are now mounting certain fixtures on casters or rollers—so the fixture can be wheeled to any area of the store. Mobility in at least some fixtures is of considerable importance in many stores. Put selected fixtures "on legs"; enable them to "walk about" as needed.
Incentive Programs for Salespeople

Competition from fields other than retailing for selling talent demands compensation programs which reward selling talent in direct relation to its quality. This applies to a degree in all stores, but becomes nearly indispensable in those outlets selling big-ticket merchandise where the sales person is given some discretion in meeting price competition. Here is a partial list of the forms these incentive programs are taking: (1) A straight percentage of the selling price. (2) A fixed percentage on the gross profit. (3) A flat percentage of the total selling price plus a fixed percentage of the gross profit. (4) A percentage of all gross profit above a certain predetermined minimum. (5) A commission system which drops a percentage point for each five or ten per cent reduction from list price. (6)



A sliding commission on total monthly (or yearly) volume with vastly increased rewards at high levels. (7) A base commission based on units plus a sliding commission based on sales dollars. (8) Combinations of the previous incentive systems. Fixture Mobility to Create Change A specialty shop operator has created what he refers to as "complete fixture mobility." Every fixture in the store can be shifted to a new location in minutes without removing the stock. Each fixture is modular, can be used separately or in conjunction with any other fixture to create new departmental shapes, new traffic patterns, etc. Color panels in each fixture can be changed quickly to give a new basic background color. An appearance of newness, an impression of change, is second only to "Bargain" as an attribute with which most merchants attempt to impress the shopping public. And it's true that the pace of change in retailing was never faster than it is today. But it's important to keep in mind that shoppers don't have a detailed familiarity with store appearance. The change which is so apparent to the retailer is rarely as noticeable to the shopper, and is often overlooked completely. Change must be dramatic to make a sharp impression on the shopper.
Use Your Phone for Suggestion Selling

A large hardware store has put all of its salespeople through a special training course designed to show them how to make extra sales with every telephone order. A druggist reports that by suggesting one related item with every incoming telephone order, this source of volume has picked up over 20 per cent. Check your telephone selling to see whether it includes suggestion selling—the mere mention of a related item, when the customer is phoning in an order, can work wonders.
Put in a Franchisee! Section?

Many established retailers—chains as well as independents—are putting in what could be described loosely as "franchised sections." Thus, a variety chain has been featuring in its newspaper advertising its "catalog desk." This is, really, a franchised operation that uses the catalog of one of the catalog houses (the catalog carries the chain's name; purchases are shipped direct to the customer's home by the catalog house). Several companies are making complete in-home selling programs available to retailers on a franchise basis—a number of department stores have taken on this proposition for main-floor items. The entire program is handled by the in-home specialists. Then, of course, there is a wide variety of franchise operations available ranging from footwear to tires. The smaller



retailer has tended to look dimly at any "outsider" coming into his store. But this attitude may now be changing. Certainly the "outside" specialist may play a role in helping many types of merchants to survive in this era of fierce price competition.
Coordinate, Coordinate, Coordinate

Retailers inventorying bathroom items have found that by coordinating their inventory and then promoting the concept of coordination, they have been able to break away from item selling and write a much larger average ticket. This fundamental principle of using coordinated merchandising to produce multiple sales can be developed much more emphatically in many merchandise classifications. It calls for a policy of buying that will lead to inventories that are better ensembled. Then it calls for floor displays that are better ensembled. Then it calls for better training of salespeople in the gentle art of ensembling and how to sell it. Finally, it calls for creative promotion of coordination. Study the store to find just one department where coordination has been somewhat neglected. Then put this program to work in that department or section. From that starting point, the idea can be adapted for use in one section after another. Example: a "package plan" involving coordinated draperies and carpeting. Another example: coordinating linoleum for floor and counter tops.
Fashion Is Touching Everything

Dame Fashion is extending her sway over a mounting diversity of merchandise. Clearly, there are fashions in foods, particularly with respect to food served during home entertainments—remember how "baked Alaska" became "the thing"? There are certainly "fashions" in drugs— vitamins ruled the roost a few years ago and are currently staging a comeback; the antibiotics are, of course, presently Fashion's drug favorites (does anybody doubt that in a few years they may be supplanted by new concepts?). In homes, the "closed-in" home may soon begin to supplant the "open-to-the-outdoors" home; and as the architecture of homes changes, so do home furnishings. Dame Fashion is casting her spell over many former staples in soft goods. And Dame Fashion, through color, will still further accelerate the dynamic obsolescence of appliances.
Are Everyday Gifts Bigger than Christmas?

Christmas has been the great traditional gift-giving holiday for so many generations that force of habit leads to the automatic conclusion that Christmas is far and away the biggest gift-giving event of the year. But if the everyday gift is classified as an "event"—and it really is precisely that—then it may be that the everyday gift market is now larger than



the Christinas gift market! No statistics are available to prove or disprove this theory. But every retail merchant knows that the everyday gift market has expanded fantastically—interesting evidence of its growth conies out of the fact that the sale of everyday greeting cards now exceeds the sale of Christmas greeting cards. Few merchants have ever attempted to tote up their everyday gift volume—especially classification by classification. Try a rough calculation some time. The total arrived at will probably be pleasantly shocking. Then ask: "How much larger could my everyday gift business become if I really merchandised and promoted everyday gifts more thoroughly and more smartly?" (The makers of gift wrappings report that everyday volume is leaping ahead.)
Getting Customers to Visit More Departments

The larger stores become, and the more varied the number of categories stocked, the more difficult it becomes to induce the shopper to visit more and still more departments. Here are some suggestions to achieve that goal: (1) Install a really dramatic store directory; soup it up! (2) Install other directories at many points throughout the store; this is seldom done. (3) Use humorous and attention-getting section markers. (4) Put in phones so shoppers may inquire concerning location of wanted section. (5) Drill your salespeople so they won't send shoppers off on wild-goose chases—and check them with your own shoppers. (6) Put up miniature directories of near-by sections at many spots, especially covering related merchandise. (7) Most important, shop the store periodically to determine problems in locating merchandise—whatever store personnel experience difficulty in locating, the shopper simply will never find!
Scraping Off Overhead Barnacles

A retail business, like any other business, accumulates overhead barnacles each year. And, since habit and tradition are difficult things to change, these barnacles are not easily "scraped off." One retailer tells us that he recently checked every basic operation against two standards: (1) Why do we do it? (2) What would happen if we stopped doing it? Simple questions those, but the net result was the elimination of a number of time and money consuming motions that nobody had ever stopped to question. It's mighty difficult to put habits through a third degree— but also mighty profitable.
Woo That Cash Customer

Every well-developed retail trend carries with it an opportunity for some retailers to go exactly contrary to the trend with great success. Credit selling is a current case in point. Nearly everyone has turned or



is turning to some form of credit selling. The existence of the cash customer is barely acknowledged. Still there always has been and probably always will be a very substantial portion of the shopping public who prefer to pay cash for the things they buy. Countless other shoppers would respond to a smartly phrased suggestion that they buy for cash. There is now a rapidly growing awareness by shoppers that credit can be expensive. Consumer groups and some state legislatures have pulled out the stops in criticizing what they refer to as the high cost of credit. Some retailers already tag their merchandise to indicate the dollar savings involved in paying cash as opposed to time payments. Perhaps right now is the time to start wooing that sadly neglected cash customer.
Encourage Customers to Report "Can't Finds"

As stores become larger, more shoppers go through the frustrating experience of being unable to locate one or more wanted items. Sometimes it's just a case of not being able to see one's nose in front of one's face. But very often it's a result of poor signing, poor display, etc. With this in mind, a large retailer one week every month puts memo pads in strategic spots throughout the store, along with a receptacle box, and asks customers to note down items they wanted and could not locate. Floor attendants make special reports during this week on merchandise which shoppers have difficulty locating. Then a meeting is held to determine how these unfound items can be made to jump out at the shopper. This is an excellent way to up the average ticket—and to keep the shopper more content.
Overcoming Store Emergencies

A large retailer has kept a record for over ten years of every store emergency in his several outlets. These include fire, flood, blizzards, smog, strikes of various kinds including transportation strikes, power failures, etc. Then he worked out a program designed to meet each of these emergencies. These programs are down on paper—and, each time an emergency hits, the proper program is not only put to work, but, when the emergency is over the program is restudied in the light of the latest experience and improved accordingly. Emergencies cost retailing huge sums. Knowing how to meet them in advance can save huge amounts.
Cutting the High Cost of Excessive Returns

Here are some specific suggestions for cutting the high cost of excessive returns: (1) Bring together all competing merchants for a common policy. (2) Advertising jointly pointing out that everybody pays the price for the return-happy shopper. (3) Put a time limit on returns. (4) In-



sist that all returns must be accompanied by sales check or gift slip and must be in original condition. (5) Place a nominal charge if a truck must make the pick-up for the return. (6) No cash refunds. (7) Display posters listing return restrictions. (8) Make a list of customers who flagrantly abuse the return privilege—bear down on them.
Color in the Retail Plant

Years ago, factories found out that color can increase production of plant and even warehouse employees. Now retailing is making the same discovery. A food super reports that decorating its meat cutting and packaging room in two shades of pink has taken the cold feeling out of this low-temperature room. Yellow check-outs, checkered to appear like small inlaid tiles, seem to increase the efficiency of check-out personnel. Colored fixtures seem to stimulate employees as well as the shopper. Color is being used in retailing to organize functions, as a technique of communication. Employees seem to be more careful when fixtures are colored. Signs, direction panels, contrasting walls done in color aid employees to find their way around better, to spot wanted things better—and to direct shoppers better. In the retail warehouse, color is finding the same uses as in factory warehouses.
Exciting Public Service Displays

Too many so-called "public service" displays—both in the window and in the interior—tend to be dreary. Exciting public service displays cannot only build good will, but can also stop traffic;—and when you stop traffic, you have a chance to make a sale. Examples: Displays portraying local historical events—with local people loaning antiques for the purpose. A druggist reports, for example, that a Civil War display, including photos of locally prominent people who fought in the conflict, resulted in both parents and teachers bringing children to the store to see the display. Similarly, a food outlet worked with the art department of the local high school and put up the best art work of the local students. Residents were asked to vote on the prize winners. Obviously, community or public service displays of this kind stop traffic. They also produce instore traffic and make sales.
How to Identify Departments and Sections

The novel touch in departmental identification can give a store that all-important interrupting note. A gigantic watch identifies the watchclock section. Caricatures of storks identify the infant section. A humorous rendition of a mop and pail identifies the clean-up shop, etc. And, by the way, in all store signs, bear in mind that women who wear glasses



seldom wear them when shopping—an amazing number of shoppers shop almost "blind." Be sure your signs can be read by the astigmatic. Clerk Wrap vs. Central Wrap While some retailers continue to debate the merits of central wrap vs. clerk wrap, most retailers who have adopted central wrap can prove with figures that central wrap is the better procedure. Clerk wrap has the great disadvantage that it is one more nonselling function for personnel who are being paid to sell. And, during those peak hours when most retailers do 75 per cent and more of total volume, clerks spend 75 per cent of their time on nonselling functions of which wrapping is perhaps the most time consuming. Sears Roebuck has made exhaustive tests which prove the unquestionable value of central wrap in all its various size stores. Give your salespeople more time to sell—and they will sell somewhat more effectively.
Ideas for Cutting Delivery Costs

(1) Consolidate customer orders, even if items are nonrelated. (2) Mail hosiery "sends"; it costs less than truck delivery. (3) Encourage customers to make returns in person—saves high cost of truck pick-up. (4) Never let up on the drive to encourage take-withs and soft-pedal c.o.d.'s. (5) Try telephoning before making deliveries. (6) Work with your suppliers to redesign packages in order to save on your delivery expenses—few suppliers ever consider this factor; remember that the more the bulk, the higher the delivery cost. Point out to suppliers when packages have excess "air"—it means extra delivery expense.
Extra Uses for Parking Lots

Some retailers are going far out of their way to insure that their parking lots are used for a larger part of the time the store is normally closed. They reason that at least some of the people who come after hours will return during store open hours and that as shoppers use the lot more, the store name will turn up in conversation with increasing frequency. Community or church events are particularly desirable—some retailers actually circularize likely organizations regarding the availability of the space. Square dances and exhibitions have also attracted large crowds, as have adult athletic competitions in such likely sports as shuffleboard and badminton. Of course, nothing should be allowed to interfere with the primary use of the lot, but so long as regular customers have no cause for complaint, these extra uses can produce a substantial extra return from the parking lot investment.



Sell 'Em by the Boatload The carload sale has been a hardy perennial—and it's still mighty effective. But now the boatload sale is becoming something of a runner-up. The boatload sale probably started in the food outlet; small rowboats were initially used to display pop corn or potato chips, canned fish, cheeses, etc. Maybe because some 10 million families now own a boat—the mass display of merchandise in a boat promptly scored a hit. Now it is being adapted for use by other types of retailers. The toy departments of a number of stores have piled toys into a boat as a new form of jumble or hash display. Children's socks and other staple soft-goods items have been promoted this way. However, the idea is still in its infancy—before long, some retailers will be setting up sizable sailboats or motorboats— and filling them with merchandise. This will probably be done with the cooperation of the manufacturer of the boat. Just as the carload sale automatically signaled extra value—so does the boatload sale seem to sell out extra value. And it has a long way to go before it is overdone.
Telephone Selling for Smaller Stores

The various telephone companies of the Bell System have invested millions, yes millions, not only in marvelous new equipment for telephone retailing, but also in the development of completely tested programs for telephone selling. There is a mistaken notion among medium-sized as well as smaller retailers that this equipment and these programs are intended solely for giant merchants. This isn't so at all. Check the local telephone company—there's no charge at all—and find out how to put to work the equipment and the programs now available for better telephone selling. Remember that telephone selling is right now one of the fastest growing forms of reaching out to the customer (some large department stores actually get up to 12 per cent of their total volume via the telephone; Sears will do almost a half billion dollar volume over the telephone in 1962). Years ago, smaller retailers did a good job over the phone. Then they drifted away from telephone selling. Now's the time to jump back in. Telephones for Shoppers inside the Store Under modern conditions of self-service and self-selection, there is a frequent need on the part of shoppers for contact with someone in the store who can tell them—for example—where to find a desired item without inarching over the entire store to locate it. (A shopper told us about spending 15 minutes trying to locate a package of toothpicks in a food super!) To aid the shopper faced with this dilemma, some retailers



are now placing telephones at strategic spots in the store. The shopper picks up the phone, each of which really becomes an "information station," and is immediately able to talk to someone who can answer her question. A large department store uses a variation of the same idea— reasoning that shoppers examining model rooms in its furniture floor would rather not be approached by a salesperson until ready, this store placed telephones in the model rooms. When the shopper wants a salesperson, she picks up the phone.
"Safety" as a Promotional Theme

Some time ago, a fabric house achieved excellent volume with a promotion that was themed: "Children Should Be Seen—Not Hurt." The promotion featured highly visible patterns in children's garments. More recently, a housewares and gadget promotion featured the theme: "For Safety Sake." The items promoted included fire extinguishers, child-proof medicine cabinets, automatic emergency light, burglar alarms, instant flat tire repair kit, etc. Safety gets such an enormous amount of publicity that it automatically becomes excellent promotion: anything so much in the public eye is promotable. Yet few retailers have staged safety promotions.
Prodding Inactive Accounts

Does your charge account or credit account list show inactive accounts? Most such lists do. Here is an inexpensive way to bring them back to life. (1) Run newspaper ads based on the "Lost, Strayed, or Stolen" theme— ads urging customers to utilize fully the charge and credit facilities of the store. (2) Simultaneously, when sending out the monthly statement, mail a special statement to the inactive account. On this statement, in the space usually used to list the current status of the account, print a message like the following: "These are busy shopping days, but we have missed you recently. This reminder that your account with us is cleared is combined with an invitation to visit us again soon."
Promote Employee Discounts

Employee discounts are now traditional in retailing. And that may be one of their weaknesses—they may have become too traditional and therefore simply accepted as part of the routine. Why not promote employee discounts, why not "sell" to your employees with all of the drive with which you sell to other shoppers? Why not consider the employee a customer—as he and she really are? Some stores report less than 1 per cent of volume done with employees—others report up to 3 per cent and a few have hit 5 per cent. One retailer permits temporary help to buy at



discounts for 30 days after their temporary stint is finished. Another retailer encourages employees to buy at discounts for relatives. Several retailers are changing employee shopping hours, changing systems for permitting employees credit arrangements. Another permits retired employees to continue on the discount plan. Special sales are being arranged for employees. Posters featuring employee discounts, special sales, etc., are being put up in locker rooms, rest rooms, etc.
longer Reading Time for Retail Ads

Retail newspaper ads tend to get more reading time than manufacturers' national ads in other media. But successful retailers constantly search for ideas that will win still more reading time for their newspaper advertising. A large chain has successfully run a newspaper campaign in which each ad included a crossword puzzle. The crossword puzzle was based on the names of advertised items. Shoppers were invited to complete the puzzle, bring it into the store, and drop it in receptacles strategically placed in the store units of this chain. In each store, the first ten contestants whose completed and correct puzzles were drawn from the receptacles were each given a $5.00 prize in merchandise. The plan proved so successful it was continued for several months—when the number of entries dropped off. Now the chain is studying other types of puzzles that could be adopted for similar use.


581 Everyday Ideas That Move Merchandise Every Day

Here are 581 "ideas in brief that can help move more merchandise faster. Most are very simple to put into action—all can effect amazing results from a minimum investment! 1. To increase the attention level at after-hour sales training classes, one store puts an amount equal to the employees' hourly wages in a kitty. Each clerk's share of the kitty is determined by the grade she gets on the final exam. The store doubles the kitty and gives prizes. 2. A "Scratch and Dent" sale, humorously illustrated in newspaper ads, brought excellent results on slightly damaged merchandise. 3. New idea in fixtures is to so design them that customers can see over, under, and through them. As fixtures get higher, this see-through concept becomes more important. 4. An automatic shoe shine machine in front of a store showed amazing results in bringing more men into the store. 5. Old wagon wheels are being used for attractive displays;—so are cobbler's benches and other antiques. Remember that millions of people dote on antiques. 6. Floor help in one chain wear buttons—changed periodically—that contain only initials. One button carried initials: S.W.A.S. Customers invariably inquire meaning of initials—in this case "Service with a Smile." 7. A "ferris wheel" made of wire has proved a dramatic display device. Merchandise is placed on the hanging shelves of the wheel. These wheels have been made in many sizes—ranging from perhaps three feet in di ameter to ceiling height. 8. An extra facing may increase sales for one item—but, if another item is displaced, balance the decreased volume on the displaced item against the gain for the item getting the extra facing in order to get the true results. 9. There's something about a gigantic cake on display that compels attention, especially from women. A 200 to 1000 lb. anniversary cake is a top traffic stopper. 10. More stores are installing a telephone information connection for



floor traffic—it's really a handy intercom set up for the customer. Even medium sized stores have found that customers appreciate the service. 11. Looking for an unusual contest prize? Try a free long distance phone call. 12. Even in areas where there is little uniformity in store hours, few stores post their opening and closing hours prominently. Old customers may know your hours well, perhaps, but how about new customers? 13. This store uses one of its windows to attract applicants for sales personnel, especially extra personnel for rush seasons. When tied up with newspaper advertising the combination has pulled extremely well. 14. A simplified sales check saved one large store $1,500 in time in the first year. Simplification of sales checks could save precious time dur ing peak hours and cut down walk-outs. 15. Related selling is encouraged by a system of bonuses which are paid only on sales slips which show a related product sale. The more re lated items on the slip the bigger the bonus. 16. A grandparents' day promotion turned back the clock (pricewise) on selected items to the prices which prevailed 50 years ago. Results were so good the event will be repeated regularly. 17. Beware of too perfect housekeeping. It leads customers to follow a hands-off policy, yet everyone knows impulse selling requires a hands-on policy. 18. A window devoted to a picture of each employee together with a brief biographical sketch attracted unusual attention. It pays to develop the personal aspects of a business. 19. Salespeople at one fine specialty store are required legibly to sign their full name with a "thank you" on each sales slip. 20. A "Fast-seller Checkup" sheet, used daily, will cut down out-ofstock on best movers, especially during big holidays. 21. Never underestimate the power of flowers. A merchant who an nounced he would give away free rose bushes to the first 200 customers got heavy traffic. 22. Try dramatizing a truckload sale by putting miniature trailer trucks atop merchandise, counters, in windows, etc. 23. Try supplying fashionably decorated shopping bags with greatly enlarged capacity to encourage take-withs. Carrying multiple packages is a chore most women despise. Put colored reusable handles on packages. 24. A poster in employee locker rooms of a large retailer reads: "If the Customer Buys 5 Cents Worth or $20,000 Worth—Smile and Say Thank You." 25. "Our cash register tapes are redeemable by charitable organiza tions at 1 per cent of face value" announces a successful store.



26. Try creating familiarity with interior departments by showing huge photographic blowups of these areas in your windows. Remember that even regular passers-by may be completely unfamiliar with your store interior. 27. Capitalize the personal aspects of your business—equip everyone on the selling floor with name plates and business cards. Encourage the use of names when dealing with customers. 28. A ticket good for a free ride at a local carnival was issued on the basis of one for each dollar of purchase. It proved to be such a tremen dous shopper lure, that it is being repeated with other forms of entertain ment. 29. Make a game of out-of-stocks. Assign areas of responsibility; give rewards for each week that no out-of-stocks are found; levy a fine for each one found. Put all fines in a kitty to finance an annual party. 30. Keep testing new locations for outposts of major departments. Putting the outposts on wheels will make locational testing much easier. 31. Daily drawings for huge stuffed animal toys—some of them almost life sized—proved immensely popular. 32. "Our creed—no sale is final until you are completely satisfied." 33. Maybe your store and its customers have changed faster than some of your traditional policies. Variety chains, for example, are now cashing checks because big-ticket items, etc., make this logical. 34. When a new merchandise classification is added, this store checks, rechecks, and then checks its performance once again. Too many new merchandise categories are not paying their way. 35. Try a quick drive past your windows at night—check to see that they get across one short, clear message. 36. Many merchants now offer every new home owner and new apart ment house tenant a charge account—automatically. 37. To build up Saturday volume, try a newspaper campaign using theme: "Save Saturday for Shopping—Save Sunday for Your Family." One large store, which has financed this promotion itself, reports excellent results. 38. Make your store important to salesmen. Program could include: A realistic appointment schedule, a comfortable waiting room, and awards to the salesmen who have helped the store most in the past year. 39. During peak hours, this merchant brings all nonselling people on to the sales floor. Each is given an "Assistant Salesclerk" button. Their primary job is to assist the regulars with wrapping and change-making chores. 40. Try trading stamp offers as incentives to salespeople. The cost is low and the impact unusually high. 41. Inside the door of this store is a small box containing dimes for



parking meters. Shoppers make own change. To date—no shortages! 42. To push larger sizes, show them on the side of the facing that will be seen first by the largest number of customers. Thus, if customers ap proach a shelf from the right, give large sizes a right-hand arrangement. Simple, but it works wonders. First seen—first bought. 43. An intrastore sales war splits all selling people into two teams. One per cent of sales goes into a kitty—winning team gets 75 per cent— the losing team 25 per cent. 44. Exclusivity is of growing importance in merchandise. Try an event built around "Merchandise made solely for us." 45. Having trouble directing shopper attention to section or depart mental signs? Try duplicate signs placed one above the other. 46. A prominent sign over a volume-producing portable fixture reads: "Our comparison shopper's selections for outstanding value." Another store is very successful with a "Manager's Choice" table. A qualified authority's endorsement of value is highly convincing to shoppers jaded by big value claims. 47. Demonstrations, sometimes performed as part of an act by a ma gician or clown, grow in popularity as shoppers seek stores where they will be entertained while they shop. 48. A sign reading: "Do You Know You Can Save 50 Cents on a Typi cal Shopping Trip to Blank's?" with 50 pennies mounted on the card, attracted unusual attention. 49. Subsidized schooling for employees works this way in one large chain: The employee chooses his subject, gets scholarship committee ap proval, registers, and pays his tuition. He sends his receipt to the com mittee and promptly is reimbursed for half the tuition. When he satis factorily completes the course, he is paid the remainder of the tuition. 50. Try a "How Would You Do It?" competition among employees. Each week employees are asked how they would solve a specific problem. Awards are offered for the best suggestions. The secret is to pick out each week a specific problem on which employees may have ideas. 51. Want free background posters for windows, etc? Get in touch with foreign consulates, foreign trade missions, the tourist offices of the various states, etc. 52. Several stores now use electric message repeaters telling customers of the location of cash-wrap service stations—even big signs are some times overlooked, but the human voice seems to penetrate. 53. A display of very old models alongside current models is one of those old display standbys that never seem to lose their appeal. 54. Chances are some of your employees have hobby collections. Bor row them for window and other displays. 55. Do you have a lounge for shoppers? Put a fixture or table there—



display impulse items—rotate them frequently. Lounge space can become sales area. 56. When you employ "mystery shoppers" try recruiting them from local women's groups. This is good "public relations"—and these women will usually do a competent job of "mystery shopping" if you provide them with a specific list of the points you want checked. 57. Life-size figures down in caricature and placed on the sidewalk at store entrances attract amazing interest. Example: A life-size chef for a lunch counter in a variety chain. Sidewalk promotions are staging a comeback. 58. Even food supers are returning to identification buttons for em ployees—which suggests that other retailers might consider this same plan for injecting some degree of personality and human warmth in selfservice and self-selection retailing. 59. A large retailer reports that an extra day's vacation, with pay, for every stipulated amount ($100.00 in this case) of special compensation merchandise is more attractive to salespeople than cash incentives. 60. A big problem for that new resident on the family's first day in its new home is—meals. One retailer offers a free meal for new families; maybe three retailers could get together and offer all three meals free. 61. Put up a "vacation need" chart near your cash registers. Change it periodically to cover a variety of merchandise. 62. Devices are becoming available that enable street traffic, by pressing a button, to activate a window display. These devices do a good job of stopping traffic. 63. The "Cat and Dog" clearance continues to pull in traffic. 64. Four times a year, conduct a contest among floor employees, offer ing prizes for best merchandise displays. It works wonders. 65. Wire baskets mounted on wheels are proving an effective mobile floor display. 66. Try a display of "The Largest Birthday Cake Ever Baked in _____ " for your next anniversary. 67. To lessen the traffic slump that usually follows a whooped-up store opening, one mass retailer offers $2 coupon books that are good only after opening week. 68. Caricatures of leading citizens, displayed both in the store interior and in the window, have become an important humorous promotion for several stores. 69. A telephone call to a customer who hasn't been in the store, or to a charge account that hasn't been used for too long a time, can work wonders. 70. Pick a number—any number—promote it to the hilt. One retailer picked number 36; no reason. Ran newspaper ad teaser series: "Watch



for 36." Then put huge "36" signs up in his windows, then on his trucks, etc. Then featured items at 36 cents, $1.36, $2.36, $3.36, etc., etc. 71. Develop contest ideas for juniors that enable school authorities to work along with you. For example, a table-setting contest for teen-age girls won support of home economics teachers in local high schools. This one is an annual event; the school winning three times keeps trophy. 72. To get rid of bad buys—use newspaper ads announcing a "Follies" promotion. Another theme: "A 'goofy' sale to unload our 'goofs.'" Still another: "Pardon us—our slips are snowing." 73. Running a "trainload" or "carload" sale? Get a number of toy trains. Display them on top of sale merchandise. Install an electric train set; keep it running. 74. Several large retailers have prepared lectures, some on slides, to be delivered before high school students, parents and church groups, etc., on the opportunities in retailing. 75. A new single-floor store reports that interdepartmental selling has cut sales personnel needs by 20 per cent. 76. This store painted its front gold to celebrate its 50th anniversary. Why not a silver front for the 25th anniversary, etc.? 77. Some modern store layouts "speed" the customer too much. Compel a few detours. Put in interrupting notes. Symmetry and uniformity make poor retailing. Cut down the shopper's walking speed—and build up your average sale. 78. A free lollipop for each youngster in your store can work well. 79. Try making special parking arrangements for your employees and for your customers with local gasoline stations—if any are nearby. And include in the arrangements appropriate displays for your store at the gas stations. 80. Ever try a bounty for employees who bring in employees? It works. Offer a flat sum for each new worker brought in by a present employee. Then offer a second reward when the new worker has rounded out his first three months. 81. Few demonstrations are so persuasive as "before-and-after." It's an old, old idea—but it never loses its selling punch. 82. Toy animals that move with the slightest jar—animals with hinged necks, for example—are spotted by one store on tables, gondolas, etc., in various departments. They provide motion, and motion attracts the eye. 83. Low-level fixtures facing out of the store do not interfere unduly with open-view fronts, constitute a new type of "window display." 84. Free photos of children is one traffic pulling device which never seems to become outmoded. 85. A retailer has special night-hour "sales" during which the door



remains locked. The price of admission—any receipt showing a previous purchase. 86. "Stick-on signs" consist of pressure-sensitized labels affixed to standard cards. They cut down need for completely preprinted signs, have other advantages. (Some cards may have several preprinted lines, supplemented by stick-on label copy.) 87. Want to encourage employees to develop and carry out programs for expense control? Try offering a reward—a flat 10 per cent of the savings no matter how large or small it may be. 88. At one outlet, when a charge customer has had no entries added to her account for six months, she gets a phone call to find out if she has had any cause for dissatisfaction. 89. Why not try a "mongrel" dog show—no purebreds allowed? It appeals to youngsters; and whatever appeals to youngsters also appeals to parents. 90. One store has found that it can cut porter service costs by em ploying, on a part-time basis, post office employees. The percentage of town, city, county, state, and Federal employees who are working two jobs is amazingly high. 91. A simple memo sheet recording traffic costs—and thus preventing these costs from being buried in the gross margin—has enabled a store's management to properly evaluate, and to make plans for lowering, these costs. 92. "You'll find our lounge an ideal place to meet your friends" sug gests one store in its newspaper advertising. A place to meet friends during or after shopping is often a problem. This retailer offers a neat solution. 93. Free plastic rain hoods in purse containers are offered to cus tomers each time it rains. Women come in from several blocks away and stay to buy. Cost is small. 94. The words "Last Piece" on a clearance item convey a strong measure of conviction to shoppers. 95. A "one-of-a-kind" collection pulls for one shop. Price is strictly secondary to shoppers seeking exclusivity in merchandise. 96. One store phones newcomers. Offers to bring them to the store by car, take them on a conducted tour, and return them to their new home. Smart! 97. One merchant devotes a single window to a different hobby each week. Hobbyists are incurable enthusiasts. Play up to them. 98. A department store pays ten cents for every want slip filled out by a sales clerk indicating an out-of-stock not previously spotted. 99. The "Mystery Box" idea is enjoying a rebirth. One of the na-



tion's most exclusive stores did a whopping volume on $25 mystery boxes; some stores report fine results with 19-cent mystery boxes of tiny toys. 100. Each week this merchant runs a newspaper ad containing 100 names taken from its customer lists. Anyone whose name appears gets a 10 per cent discount for the week. 101. Tabs from top New York restaurants and nightclubs, photo graphically enlarged, make attention-getting backdrops for windows of stores in other cities—public everywhere is fascinated by these night spots. 102. The "message center," a front-of-the-store location where shop pers can leave messages for friends, is widely used. When prearranged plans go awry, shoppers now automatically check there. 103. Very low level merchandise displays are made more effective by the addition of baseboard lighting. 104. Try a "Rogues' Gallery" containing a picture of each of your salesmen. Many customers recognize salespeople by their appearance rather than by name. 105. Offer to check parcels for obviously overloaded customers. Shop pers laden with previous purchases invariably cut short their shopping and tend to weigh each purchase against their ability to carry it. 106. Get the full benefit from new items. Identify each piece with a colorful "brand new" tag. They are most helpful when the article can't be given feature treatment. 107. Shoppers are often more impressed with the dramatization of a price cut than they are by its actual size. 108. The demand for customized items is prompting some stores to in stall and promote a "Special Order" desk catering to unusual shopper requirements. 109. Trading stamps are becoming a popular form of charitable dona tion. Some stores will match any customer donation. 110. A small window sign reading "Teenage spoken here" sparked a great deal of comment. 111. Instead of imprinted bags and boxes, one store identifies with a wide, distinctive sealing tape which incidentally helps cut down pilferage. 112. Try a small "Odd Ball Dept." to move odds and ends of mer chandise which have been discontinued, etc. 113. Twice each year one store pulls all merchandise out of the windows and for one week devotes the entire space to a flower show. Traffic invariably improves. 114. "Have your car washed at our expense while you shop" was the



highlight of a special promotion at one store. Arrangements were made with a nearby auto laundry to return the cars within thirty minutes. 115. A promotion offered discounts on different groups of items every hour. Roving salespeople followed the specials from section to section to insure peak efficiency. 116. Gift sections for children showing dollar items on extra low fix tures are viewed by most customers as a service. 117. Phone order activity is stimulated by a series of "phone-in specials" which are only announced to customers who have actually placed an order over the telephone. 118. It may pay to encourage complaints. The shopper who has not only "gotten it off her chest," but then been agreed with as well, is very apt to become a customer for Me. 119. Clearance items were put on temporary fixtures inside the en trance from opening to 11:00 A.M. only. It pulled early traffic. 120. Old-time merchants, in the Gay Nineties, hung merchandise from the ceiling. Now it's being done again—in some smart stores, too. But it's being done smartly, neatly, effectively. They're being called "space platforms"—one store makes them 7 feet in diameter and suspends them by heavy chains 8 feet above the floor. Even major appliances are displayed this way. 121. Fixtures and counters, which formerly hugged walls with mili tary precision, are now chopped into short units and arranged so they angle away from the wall. Besides reducing fixture monotony, they present many more opportunities for feature displays. 122. Out-of-stocks in each section become the direct responsibility of a particular clerk. He is offered a 50tf bonus for every day that no "outs" show up but is fined 25 # for every one that does. 123. A sign indicating that an item is available in "limited quanti ties," is an old idea that always seems to insure rapid stock movement. 124. Portable wrapping desks manned by part-timers can be wheeled into position during peak hours to take the load off key salespeople. 125. As families do more shopping together, the diaper-changing service idea is spreading. In these days of young-large families, a diaperchanging service has a broad appeal (call it the "Small Change Room"). 126. To encourage employees to keep the store cleaner, one retailer arranged a Clean-Up Contest. Awards consisted of gold and silver brooms, decorated with diamond chips. 127. A theater party, staged by a retailer in the local movie house, was so successful it is now an annual event (in its third year). A fulllength feature film is shown and 25 door prizes offered. 128. Photos of customers shopping in the store, reproduced in news-



paper advertising, is an idea that has attracted unusual attention to a chain's advertising. 129. Salespeople were equipped with portable dictating machines for use in taking inventory. The inventory was accomplished in spare time without any impairment of floor selling efficiency. 130. Cut down on deliveries to the store during your peak hours— because these deliveries cut down on your peak-hour volume. 131. An occasional upside-down display continues to attract unique attention; it stops shoppers dead in their tracks. 132. Whether you sell food or drugs, infant's apparel or juvenile furniture—why not arrange with the local florist to send an orchid to be pinned to the pillow of each new mother when she awakens from childbirth? 133. A "Test Pilot Club" planned to impress upon youngsters the importance of safety when riding escalators, with free badges as prizes, appeals to adults and children. 134. Check possibilities of perimeter lighting. It will perk up far cor ners and walls. And check also into decorative lighting fixtures—"me chanical" lighting fixtures become tiresome. 135. If you have a garden area—indoors as well as outdoors—invite local garden clubs to plan its decoration. 136. Try mailing a rabbit's foot key chain to newcomers. Attach a tag to it; one side for newcomer's name and address—the other side for your name and address. Most newcomers will use it; and it keeps your name before them. 137. Scales that talk while the customer is weighed, vending machines that make a sales talk, floor mats that talk when stepped on, gates that talk when pushed open, major appliances that talk when buttons are pressed—all these are actualities. As salespeople talk less, and as what they say does less selling, robot speakers will become still more popular. Self-service and self-selection can use the human voice—recorded. 138. Instead of plaster, one store finished the stock room walls with peg board. Found that it provided fully flexible storage space from floor to ceiling. 139. To dramatize its 80th anniversary, one store decided to celebrate by inviting all the local residents who were 80 years or older to a "party." Another celebrated its 70th anniversary by displaying merchandise of 70 years ago—all contributed by local residents. Both stores simultane ously offered special values. 140. Try a free telephone service in the store. Local calls only are handled. The store phone number is kept top secret—thus long distance calls can't be made. It promises to develop into a well-used service.



141. To get sales personnel for special sales one large retailer broad casts special messages daily over the loudspeaker system right after the store closes. It offers $1 to any permanent employee recommending a recruit who is hired. It offers $100 to the one employee sending in the largest number who are hired. 142. Ever try a Customer Relations Board? It could be a rotating panel of perhaps a dozen reasonably prominent women. At monthly meetings they are encouraged to offer suggestions for improving store service. 143. A pet show for children offered appropriate prizes. It was open to the pets of any child under 10. 144. Magicians have a great appeal to adults as well as children. They are a natural traffic puller for a promotion built around the word "magic." 145. Within 30 minutes of a theft detection, all cooperating stores in one community have a complete dossier on the thief—this prevents pro fessionals from claiming: "This is my first offense." 146. In one community a group of independent retailers got together to offer a complete wedding service—the group included a dress shop, bake shop, housewares store, linen shop, stationery shop, and photo studio. 147. Install mirrors in a number of locations in your store; they dress up the store, magnify stocks, attract attention to adjoining merchandise displays, help lessen pilferage, appeal to women. 148. Including wages, the cost per year per employee for coffee break will run between $50 and $100. This suggests two basics: (1) try to cut costs, (2) try to get greater business benefit from coffee breaks by en couraging business discussions, etc. 149. To win maximum use of your parking area, note license num bers of noncustomers and warn them, post a time limit, widen exits and entrances to reduce delays at these bottlenecks, use better signs. 150. A number of retailers have constructed and equipped School Bus Shelters—some decorated with cartoon characters. 151. One of our largest retailers reports it is stepping up the hiring of handicapped and older people, for both floor and office. Industry has had splendid results with handicapped people. Retailing has lagged in recognizing their potentials. 152. A prize offer that is pulling well is dancing lessons at local dance studios. It appeals to both men and women, old and young. 153. Tilted shelves in show cases and other fixtures which present merchandise more squarely to the customer's line of vision stimulate self-selection and impulse sales.



154. "The Value Square" is a 36-square-foot front of store section featuring unusual fashion values selected from various fashion depart ments. Each day, merchandise from different departments is featured— with one department singled out each day for special emphasis. It has an extraordinary square-foot volume. 155. College scholarship programs for sons and daughters of employees have been found to be exceptionally effective in winning cooperation of workers. 156. An art exhibit showing work of local artists pulled big traffic to an appliance store—sold paintings, sold appliances, too! 157. Millions who have traveled in Europe now have a first-hand acquaintance with the sidewalk cafe. Several retailers are, therefore, now creating departmental trims duplicating the typical sidewalk cafe setting, including wrought-iron tables and chairs. 158. Amazing how few retail stores display the time! 159. The about-to-be marrieds can be brought in with a promotion theme: "Evening for People in Love." Send invitations to your bridal registry and check local newspapers for announcements. The theme makes a grand newspaper ad. 160. A showing to the public, swankily staged in a hotel ballroom, pulled in hordes of customers, made sales. This retailer used the same tactics in selling to the public that distributors use in selling to the trade. And it worked. 161. A "Meet the Experts" week, with fashion experts from top sup pliers in attendance, is a good promotion for apparel, as well as cos metics; for shoes as well as for foundation garments. Women can't seem to get too much expert fashion advice on every part of the wardrobe. They like particularly to meet designers and decorators. 162. People aspire to culture. That's why promotions offering tickets to concerts have proved such a successful lure. 163. This summer will see boating hit amazing new highs. Are you planning to promote boating items of all kinds, for men, women, and children? Why not think in terms of a "Dockside Promotion"? 164. A "Buy-Way," consisting of a series of tables running the length of the street floor, and containing specials from many departments, has proved to be an effective way of demonstrating "low prices." 165. An annual promotion featuring assistant buyers—with their pic tures in the store windows—picks up sales momentum each year. 166. An outlet blew up 3,000 balloons, stuffed each one with a coupon good for a specified allowance on an appliance. Each customer was given the privilege of puncturing one balloon.



167. For a different approach to the problem of advertising special events, try an all-white newspaper page with the copy limited to a reproduction of a formal invitation. 168. A rack in a rear location, with a "Perpetual Sale" sign over it, has become familiar to shoppers in a ready-to-wear store; any fashion item that gives early evidence of moving slowly is put there promptly and : full markdown is taken the first time it is put on the rack. 169. A large store has both a carillon for time and a loudspeaker for weather reports—time and weather interest everyone. 170. A newspaper ad showing pictures of the buyer and his three salesmen with copy quoting them as saying that "This is the greatest buy we've ever seen in a total of over 40 years selling" created big traffic. 171. A successful series of promotions has been keyed to a date— thus, on the 22nd of the month, a "22" promotion is staged. The first 22 customers in certain departments get choice bargains at 22 cents each, etc. 172. Torture tests dramatically demonstrate the durability of fabrics, materials, and finishes. In the window they're real traffic stoppers—inside the store these dramatic tests sell. 173. Topping the regular reward offered to move slow movers, one re tailer offers bonuses for a stipulated number of these rewards earned weekly. Those bonuses get salespeople to push slow movers. 174. Departmental and gondola identification signs become lost in the welter of sign cards and package displays. Unusual shapes, triangles, free forms, hexagons, etc., will help customers find it faster—so will signs bearing unusual names. 175. Instead of shouting "bargains," a large store has been running very frank ads. Items featured: "bedlam blankets," "sports wear that didn't make the team," "misses in misses' wear," etc. 176. Women love antiques; that's why so many women's shops use antiques as display pieces. These include cupboards, secretaries, chande liers, coffee tables, etc. 177. Sales Limited to a very few hours are becoming popular. Evening periods seem to work best. 178. Try a brilliantly colored tag to identify all advertised specials— mention the tags frequently in your advertising. Advertised specials fall short of complete success if customers can't locate them. 179. Put a monkey in a cage, install it on the store floor, invite sug gestions for naming it with a $25 prize for the best suggestion. It will pull an amazing amount of traffic. 180. Women who work are unquestionably the fastest shoppers for all types of merchandise. They strongly favor self-selection fixturing.



181. Humor combined with a unique free offer can generate excep tional traffic. "Free wall-to-wall carpeting for your doghouse, playhouse, or duck blind" was advertised by one outlet. 182. A corsage for salesgirls that carries out a specific color scheme involved in a promotion will attract shopper interest and stimulate sales girls to push not only that color but all colors. Try it. 183. Giant hands, full window height, one on each side of the window, made a perfect tie-up with the theme: "The Decorator's Touch." 184. Longer guarantees are becoming more popular. Here's a unique guarantee on china: "Free replacement of any piece that is chipped, cracked, or broken under normal usage in the first year—replacement at half price for the next 99 years." 185. Self-service shopping carts piled with impulse items are a trend among many stores. The positioning of the carts is becoming quite a science. It is based on tests and accurate records. 186. "Hand made" as applied to a broad list of items today indicates a point of superiority. Concentrate attention on the hand work which goes into your merchandise. 187. Feature "Key Specials." Each special entitles the customer to a key. Each key may be used to try opening a Treasure Chest. Customers with the key that opens the chest get reduced prices. 188. A shopping cart located inside the main entrance carries a sign card reading "Closeouts—Save 50%—All items in this cart 1/2 the marked price." The cart is wheeled around the store each day before opening. Broken packages, soiled items, etc., are dumped in. 189. A fireplace, as home builders well know, is a fixture of great emotional appeal. One shop capitalized on this with an Early American decor which used a large fireplace as its focal point. The fireplace is lit on cool days. 190. Some stores are experimenting with lighting which is directly above and actually part of the display cases on the theory that it directs attention to the merchandise rather than to the store as a whole. It may permit less elaborate interiors. 191. Customers will trade themselves up to higher priced numbers if given the proper information. Try a typewritten data tag which itemizes each feature. On higher-priced numbers type the additional features in red so that the customer can clearly see the advantages of the better item. 192. A turntable can bring part of the window into the store and part of the store to the window. A matching dryer and washer, for instance, were mounted on opposite halves of a turntable near the window. Thus one or the other of the appliances could be displayed inside the store or to passing traffic as desired.



193. A number of retailers now offer every new home owner in their area a charge account, automatically. 194. Retailers doing in-the-home selling report that from 10 to 30 per cent more sales are closed—and that a better job of trading up is done. 195. Have you tried a vending machine in the window—or outside the store? It promises to become a big development; it's being called "Outer Space Retailing." 196. Make a price-marking shopping tour around your store at least weekly. Correct imperfect marking. Call it to the attention of price markers. Strive for constant improvement. Clear price marking is essen tial to self-selection, self-service. 197. The Easter Bunny distributing gifts to children is becoming as much of an attraction at Easter as Santa is at Christmas. 198. Various types of shelf extenders which cause certain shelf items to jut out into the aisle effectively flag shopper attention. 199. Almost half of employee turnover is among persons who have worked in the store for less than a year. Figure the cost in hiring and training and volume lost through inexperience, and then consider whether just one-half that amount devoted toward keeping those em ployees wouldn't be money well spent. 200. The broad appeal which flowers hold for women makes them an ideal prop for window backdrops. They can be effectively used in setting up dramatic contrasts to prominent fashion colors. 201. Excitement events in which customers can participate directly are doubly effective. One such event had customers panning for gold in a plastic wading pool. 202. In addition to their regular shelf position all new items are given a full month's display on the store's "New Item" fixture. A coding system for the items on this fixture has demonstrated that a surprising number of shoppers pick up items that they have bypassed on the shelves for no apparent reason other than "newness." 203. Cover windows with paper, leaving only small peepholes at vary ing heights—just one item visible through each hole for Peeping Toms. 204. The larger the selection of coordinated or matched merchandise offered, the better the chances for increasing the average sale. This ap plies with equal truth to everything from infants' and children's wear to pots and pans. 205. Try using gorgeous gals as demonstrators for do-it-yourself demonstrations—males pay rapt attention. 206. A late-morning coffee break plus longer afternoon breaks make more salespeople available during the 12 P.M. to 2 P.M. lunch-hour shop ping rush.



207. "Mrs. Housewife—Do You Work an 8-Hour Day or a 16-Hour Day?" was the exceptionally successful headline of a newspaper ad for labor-saving appliances. 208. A year-round gift section features free gift wrapping and fast service. Most items are prewrapped, and the prewrapped packages are placed in the display case with the "display" items. 209. To stimulate lunch-hour shopping this specialty store offers a small lunch free to customers. It's a box lunch—pays off handsomely. 210. Events which present merchandise in unique places are proving successful in deemphasizing price. Techniques vary, but include parking lots, warehouses, tents, armories, trailer trucks, and sidewalks. Even roof tops have been used with success. 211. An extra low fixture for a special selection of gifts for mom and dad at piggy-bank prices drew unusual attention from the small fry. All gifts were available on a pre-gift-wrapped basis. 212. One retailer concentrates all specials in a single section. He finds this system moves the specials in good volume without cutting off the movement and additional profit of the regular merchandise. 213. A successful "hog wild" promotion included awards of free hams and bacon to customers who made a purchase. 214. One week's free home trial on any power tool is a standing offer at one hardware outlet—it has very nearly a 100 per cent trial-to-sales ratio. 215. Attention is directed to specials by a large red arrow which is wedged between the packages and juts out into the aisle. 216. Revolving shelves fit in smoothly with regular self-selection wall fixtures—are particularly effective in indicating a special section within a section. 217. One shop wrapped a manikin in newspaper and captioned the window: "Have nothing to wear—everything is on sale." 218. Merchants are increasing the display space in some departments by adding lower, rather than higher, shelves. Some of their new fixtures start just four inches above the floor. Customers apparently have less aversion to bending than is commonly believed. 219. A bargain aisle with huge dump bins in which merchandise is only loosely grouped by item has proven to be an effective lure. In prin ciple it is similar to the old department store bargain table where customers paw through the merchandise. 220. A Dollar Day promotion of small items themed "Pass the Buck" has proved so successful for one store that it has become an annual affair. Some 40 items were featured in the last promotion. 221. Show several dozen of your best-selling small items (any classifica-



tion) on a special peg board. Ask customers to pick the six best sellers from the display. Offer appropriate prizes. 222. Part-time help is one answer to the peak-hour problem, par ticularly as this help is often of extremely high quality. Teachers and civil servants often are available. Part-time help is mounting rapidly. 223. A specialty shop got permission to paint the sidewalk in front of the store green. It had amazing pulling power. 224. After you've participated in a community affair, why not run an ad on the theme, "We were proud to lend a hand—and we're happy with the results." 225. Salesgirls of one fashion store are equipped with pads, on each sheet of which is prominently printed the words "I lost a sale be cause. ..." They are required to fill them out and channel them upward whenever a sale was lost because merchandise was not on hand. 226. Salesmen doing "in the home" selling are able to do a smoother job when they substitute a portable dictating machine for tedious (and often illegible) handwriting. They also have a more complete record of just what agreements were made with the customer. 227. Clear the shelves of deadwood by setting up a "bargain basket" in a good traffic spot. Add close-outs regularly. It's surprising how customers will pore through it looking for something they need. 228. The effective job done by advertising and windows to correlate separates is rarely capitalized in the store. The actual stock is not readily located by the shopper in search of an ensemble. Shop your store and try some ensembling yourself. 229. A store which charges for lay-away cancellations has these charges on a sliding scale varying by the length of time which the order has been held. 230. A special employee's night pulled well for one store. Each em ployee was permitted to invite 10 guests who were entitled to sale prices. The event doubled as an introduction to an anniversary sale which started the next day. 231. Here's a window that really got over the story of a ready-to-wear sale. No merchandise was shown. The only props were four brooms placed as though in use, four pairs of empty shoes—one alongside each broom—and a huge poster reading: "We're making a Clean Sweep of It— Preinventory Sale." 232. A continuing record of when peak hours occur is kept by one merchant who arranges to ring up the time on the cash register together with the sale. This record of sales by day and hour helps him plan ahead to capitalize on peak-hour traffic.



233. A promotion offered discounts on a different group of items every hour. Thus salesmen were able, for instance, to concentrate on television one hour, laundry equipment the next. 234. One retailer took an ad complimenting his competition—the ad referred to competition as: "so good they keep us constantly on our toes to find new ways of serving you better." 235. One store devotes dull periods during the day to phoning cus tomers who have not added to their charge accounts in the last sixty days. Customers are told that they have been missed and are then invited to view some "special" group of merchandise. 236. To boost the idea of giving a dress for Christmas, one shop encourages a customer to select three dresses she would like to have, then suggests that her husband buy one as a Christmas gift. That way, the gift still remains a surprise. An even bigger surprise—some men bought all three. 237. All the employees at one store are appropriately costumed for every promotional event on the theory that it not only appeals to cus tomers but also serves as a constant reminder to the employees that a special promotion is in progress and of their duties in connection with the event 238. Try packaging a half dozen or more of some of your bulkier items in a shopping bag at a special price. 239. Off-beat gift certificates, good for a specific item only, were printed on large scale cut-outs of the articles they represented. 240. One store cuts stocking expenses by maintaining a list of those products whose movement is sufficiently regular so that products may be ordered at regular intervals and placed directly on the shelves instead of in the stock room. 241. A self-service store ad reproduced the store directory in blow-up form. Specials were indicated on each aisle. Many customers clipped the ad and followed it from section to section. 242. An intercom system with jacks conveniently located on the sales floor enables a two-man stocking team to replenish shelves in jig time. A floor clerk checks holes in the stock and calls out the number of items needed to the stock man below. The stock man places the required num ber of each item needed in a basket as they are called for, thus eliminating all paper work and errors. 243. A retailer in cooperation with a new-car dealer arranged for women coming in to view a demonstration to be picked up at their home in a new car and brought directly to the store. The offer was promoted jointly by the store and the auto dealer with good results.



244. A store uses women in daytime for door-to-door calls. They average 20 calls per day and make about three evening appointments for regular salesmen. 245. Is your percentage done in large-size units and large-sales units moving up, category by category? Check your figures. Large sizes are on the move, and they throw off extra profit. But don't guess; keep accurate statistics. 246. Five of the city's outstanding businesswomen are chosen by a specialty shop to make fashion selections for the working girl. The chosen styles were promoted as V.I.P. selections. 247. Try adding more sound to in-store promotions. PA system an nouncements, and displays which include a recorded message which is heard in the immediate area only, are destined to increase in popularity. 248. Sign cards of a seasonal nature can frequently be reused the following year. Try a special file to keep them clean, classified, and accessible. 249. Miniature cartoon theaters for the small fry are effective in help ing "mom" spend more time shopping, less time child watching. 250. Start your cost cutting in the back room. The greatest improve ments in stock handling, delivery checking, damage prevention, case opening, and price marking can be made here. Ask employees to help solve specific problems. 251. A 12-week bingo-type contest required customers to follow one store's advertising every week in order to complete the game. 252. A specialty shop renews interest in the store by sending a special bill to customers who have had no charges during the month. The bill reads "Of course you don't owe us anything. We would just like to see you again." 253. Boost large sizes by making it a policy always to give the large size if the customer has not specifically asked for a small size. 254. Off-hour promotions have a unique appeal. One store successfully publicized a sale for three hours only, starting at 8 o'clock in the morning. 255. A small shop has a "21 Budget Club." When the customer has made 20 purchases as recorded on her card, she gets a special price on her 21st purchase. It keeps customers coming in regularly—and enables the store to know its customers well. 256. Feature the wardrobe of a local or state beauty contest winner; it's a sure attention puller. 257. Costumed monkeys displayed in the window dramatized the theme: "No monkey business about our cut prices." These were live monkeys. 258. Free silhouettes by a local silhouette artist brought in traffic.



259. A "return to yesteryear" can be particularly effective in today's ultramodern stores. That's why some merchants are setting up small sec tions with old style fixtures and old fashioned lettering on the signs. 260. If you really want to test a new item—put it near fast-moving traffic items. Don't hide it; don't challenge it to prove itself. 261. Attention was directed to a promotion on imported products by a large map mounted on the wall behind the display. Colored ribbons were strung from the country of origin on the map to its item of merchan dise. Flags from the many countries crowned the display. 262. Letter-perfect price marking and neatly printed display cards definitely have their place, but they usually fail to get across to the shopper the idea of either a bargain or newness. Try an occasional crayoned sign to get across the idea that here is a message too important to wait for the printer. 263. It's amazing how many people need extra keys. A store which offered to make an extra key for the first 300 customers bringing in thennewspaper ad was swamped. 264. A marked reduction in walk-outs during peak hours was reported after adopting a tagging system which tripled the amount of information on each hang tag. 265. Adaptations of those familiar free-goods deals used by manufactur ers are proving effective in persuading customers to buy in larger quan tities. Try a "buy 12—get one free" offer on selected items. 266. Some retailers are meeting the problem of providing trained sales personnel during peak hours by permitting retired clerks to work on a part-time basis. Most of them welcome the opportunity to keep their hand in and earn some extra money. 267. Torture tests are most effective when the shopper participates. When a customer stepped on a nylon carpet sample in one store, a bell rang and a flashing light indicated the number of times the carpet sample had been tread on. A recorded message invited the customer to examine the sample for wear. 268. A battery of windows showed the same "manikin family" attired for a variety of activities. All the settings combined to feature a single fashion color. 269. To discourage price tag switching by shoppers, retailers are re sorting to double pricing on items. One price is prominent, the other con cealed. The concealed price marking is rarely noticed by shoppers. 270. Try extending that free trial period. One dealer periodically offers without obligation a 15-day home trial of any small appliance in the store. 271. Your store layout should be as flexible as your merchandising



policy. Keep testing the power of your various departments by shifting them frequently. Keep accurate figures. 272. "Future Saleswomen of 1972"—an exciting idea involved a contest among high-school girls competing for salesmanship honors, conducted in cooperation with school authorities. 273. The success of give-away promotions usually bears a close re lationship to the number of people who can participate and win. They are most successful when everyone can win. One store offered special values to anyone presenting a coin minted in any one of five recent years. 274. A retailer draws attention to his windows with a small "Weather Bureau" display. Instruments indicating temperature, humidity, bar ometric pressure are included with the latest forecast. The adjacent space has become a display hot spot. 275. To save on price marking, all items selling at the same price are left unmarked in some stores. Since only one price is involved, cashiers have no difficulty determining the price of an unmarked item. 276. The homey, spontaneous appearance of a blackboard outside the door makes it extremely effective in announcing specials. 277. Your old customers are your best customers. To capitalize on this fact one store supplements its newspaper advertising schedule by phoning all old customers at least twice every year. 278. Errors in paper work usually account for a bigger part of stock shortages than shopper pilferage. Paper errors often account for as much as 75 per cent of stock shortages. 279. Space for charities is smart public relations. That's why one store put it on a permanent basis. A shed was provided in the parking lot for deposit of unneeded items of clothing. 280. "Space Wasters" is a catchy label for clearance merchandise. 281. Demonstrators working under tilted mirrors are more clearly visible to larger groups. 282. Mass displays of a single type of major appliance really get that "high volume, low price" story across. A single such display may include 50 or more units—all uncrated. 283. Evidence is mounting that for a considerable list of fast-moving products, more than one location in the store is warranted. A second distinct section will frequently do more to boost volume on an impulse item than an expansion of the original section or shifting the location of the section. 284. A window which exactly reproduced a newspaper ad drew un usual attention and comment. 285. Wear tests which showed the effects of rain, sunlight, and wash ing were conducted on the sales floor. Items tested were taken from regular stock—a convincing demonstration of quality.



286. Promotions which turn back the clock have a unique appeal. One store turned back the clock to prewar prices for a limited time with sensational results. 287. "There is always something new to see in our windows" is the policy at one specialty shop. Partial changes are made daily although background and trim remain for a considerable period. 288. A minor juggling of store hours may be the way to a better net profit. Review your store open hours regularly—see where they can be cut. 289. Change makers which make any amount of change up to $5.00 at the flick of a finger reduce cash register bottlenecks and errors. 290. Too perfect housekeeping discourages impulse sales. It also cre ates a high-price look. Impulse selling demands interrupting notes—items jarringly out of place. 291. The open house idea is spreading. No merchandise is sold al though charge accounts are opened. Inducements include music, free coffee, and fashion modeling. 292. A free pony ride will bring in parents with children. A free photo of the child on the pony will do even better. 293. Excess inventory is reduced more rapidly when the "sale terms" encourage multiple purchases. One shop offered a second skirt for $1.00 with the purchase of one at the regular price. 294. Try special pricing for multiple units of items normally purchased singly. Customers have demonstrated a willingness to trade up to larger sales units when there is a price advantage in doing so. 295. Instead of the usual "White Elephant" sale to move sticky in ventory—try a Black Cat sale. One entire downtown area has staged a Black Cat sale once a year—with great success. 296. A caricature cartoon gallery of leading citizens, characters, and just plain customers is attracting unusual attention from youngsters and oldsters alike in one shop. Shoppers go out of their way to be present when the cartoonist is at work. 297. For its seventh anniversary, one store offered every customer who came in a dime for seven cents. It produced traffic, too. 298. A "Gold Rush" promotion, with emphasis on 49 per cent reduc tions, and with entire store interior and exterior carrying out the '49 theme, broke records for a home furnishings store. 299. This organization prints on all its checks—some of which go to its customers—"We are pleased to hand you our check—hope that we may have the pleasure of serving you in our stores." 300. Stock drawers with see-through glass panels do a visual selling job and frequently reveal shortages before they become acute. 301. Promotions involving merchandise from several departments fall



considerably short of full success if salespeople are not permitted to cross departmental lines. 302. Sportswear and separates are being shown by color instead of by size and price; it adds to the eye appeal, speeds up customer selection. 303. To stimulate layaway volume try offering salespeople a 3 per cent PM. When the clerk tops $200 in layaways, up the PM to 5 per cent. But pay PM's only when final layaway payment is made by the customer. 304. Babies are on the move; young parents travel with them con stantly. Market for baby car seats, folding carriages and cribs, other in fants' items is in a strong uptrend. Try a complete Baby Travel Section. 305. The recreation room in new homes is resulting in a trend toward a second food preparation area. These usually include a small refrigera tor, and a unit which permits the simultaneous use of several small elec tric appliances. 306. Try setting up special tables under a sign reading: "Any item just 10^." The number of 10tf items available is increased by breaking up some multiunit items. 307. Related item merchandising receives a boost when the items are displayed in a fixture specifically designed to promote logical go-together merchandise. One store has a portable display cart which is used solely for related item promotions. 308. Cut out tiny arrows, attach them to merchandise—each arrow explains a special feature of construction, styling, material, etc. Attracts amazing attention. 309. There is no substitute for a convincing demonstration. To demon strate the stainproof qualities of a line of carpeting, one floor coverings dealer had children paint up, stain up, and mess up a carpeting sample. A "mom" following up with a sponge and water conclusively demon strated the no-stain qualities. 310. To bring in brides, this store offers the loan—free—of a com plete silver service for the wedding reception. 311. A promotional opportunity exists in going exactly contrary-wise to almost any well-developed trend. One retailer, for instance, did well with a promotion of small sizes when everyone else was promoting large sizes. 312. Mom goes where the kids want to go and shops longer when the kids are content. Kiddielands, clowns, zoos, special events, and nurseries for children appeal to the "carriage" trade. 313. A bulletin board on which teen-age girls can advertise their baby sitting services has won appreciation from teen agers and from their parents as well. 314. The owner of an independent shop prints a guarantee on the



reverse of his cash register slips. It reads: "You have my personal word— you must be pleased with our quality and value. If not, I'll gladly replace any item or refund your money." 315. New area residents often have huge merchandise needs and no store preference. One store snares their trade by having a store hostess (a housewife working part time) call on newcomers with a warm wel come, a small gift, and an invitation to visit the store. 316. One dealer has customers spin a wheel to determine the size of their discount. Possibilities range from 5 to 50 per cent so there are no losers. The gambling instinct is apparently well rooted in most shoppers. 317. A specialty shop built a promotion around the theme "Steppingout." Included a prize drawing for receipted bills from local night spots, restaurants, and theaters which could be presented at these places in payment of bills run up by the customer. Large blow-ups of the tabs were used as window backdrops. 318. Try green paint, to simulate grass, on your parking lot asphalt. It has a countrifying effect, and adds to parking lot merchandising. 319. Round fixtures with rotating shelves are partially built-in to reg ular wall shelving. In addition to providing that essential interrupting note, the spinning shelves make it possible to show a variety of mer chandise logically related to the items on either side. 320. Shoppers make up their own multipaks in this event. A broad variety of canned goods in a huge dump display were priced at 4 for 67tf. Bags which would hold just four cans and bearing a 67* price stamp were supplied. Shoppers made their own selection—filled as many bags as they desired. 321. Deliveries on air conditioners and other totable appliances are reduced when salesmen tell shoppers "take it home yourself and save $2.00." 322. Overstocked items, discontinued numbers, and merchandise to be dropped from inventory are identified on the shelves by color coded price tags. (Code is known only to store personnel.) Salesclerks are of fered a 5 per cent commission to push these items. 323. Some stores are now experimenting with every-other-month charge plans. They feel that potential labor savings may outweigh dis advantages. 324. To make every shopping minute count, a "Career Girl Club" arranges to have preliminary selections waiting for try-on and then ar ranges to deliver the customer's selections to her office before 5:00 P.M. of the same day. 325. To get clerks out from behind the counter, one outlet turned the wrapping table completely around so that the register drawers and



wrapping materials faced the customer. Backing the about-faced counter up against a wall also gained an additional 12 square feet of floor space. 326. Mass displays of featured merchandise are hung on the wall well above regular merchandise fixtures. They serve as a reminder for the floor-located displays. 327. To demonstrate year-round free gift wrapping, one merchant in sists that a selection of attractively gift wrapped packages occupy a prominent spot in the window at all times. 328. This is becoming a "customized" age. Shoppers are actively seek ing the prestige of custom features in the things they buy. Start now to build a reservoir of local artisans who can add custom features to stock items. 329. The secret of making a small contest prize seem important is to tie it to a shopper problem which is both important and repeated. That's why offers to pay the rent, meet the next car installment, or pay utility bills pull out of all proportion to the size of the prize. 330. "Calendar" discounts on select items work this way. Beginning with the first day of the month, the price is cut $1. It is cut an additional dollar every day. Thus, on the 20th of the month the price has been cut $20. This continues until the item is either sold or at month's end the item is disposed of. 331. Do you encourage shoppers to let you know about items they want—and can't locate in your store? One outlet has a box prominently displayed for this purpose—a sign above the box reads: "Couldn't Find It? Will you please leave a note in this box? Our buyers will get it—if it is available. Thank You." A note pad and pencil are handy. 332. "Perpetual Motion" is what one merchandiser calls his floor dis play policy. He makes display changes daily—claims it stimulates his salespeople as well as having good appeal to regular shoppers. 333. Downtown stores lose too many sales during noon hour traffic peak. Have you checked walk-outs during the noon hour lately? 334. Ever think of running a newspaper ad once or twice a year complimenting your employees—and running their pictures? Everybody likes to see their picture in the papers. 335. A tab sheet listing "hot items of the week," prominently posted in one store's offices, has stimulated competitive spirit among buyers— all of whom want to see some of their items listed. 336. Repairmen fill out a special pink card whenever they service an appliance that is more than five years old. These cards are given to sales men for personal follow-up. 337. Telephone call-backs on prospects who did not buy after initial



in-home visit have uncovered a high percentage of live leads. The technique is equally effective as follow-up of in-store shoppers. 338. For store openings, an offer of an oil portrait on silk, hand painted from small photo, priced at $6.95, brought good traffic; sold portraits in good volume; and held no appeal for riffraff. 339. Public interest in the stock market runs high. Contests and sales inducements involving common stock will get unusual attention. 340. The first baby born on any holiday, or on any other selected date, is given free gifts—always makes effective baby event. 341. Small hand-lettered signs pinned to the collars of checkers fea turing specials stocked at check-out can work magic. 342. Salesclerks are kept on the lookout for out-of-stocks by offering a reward for every one spotted and verified by a department head. They are given forms to fill out which begin: "Hurry, I may lose a sale be cause we don't have ________ ." 343. Tiny classified ads with typical classified ad abbreviations were scattered throughout a display ad on a housewares clearance—drew top attention to the specials. 344. A self-service coffee cart in one shop offers free coffee and a selection of cookies. Shoppers respond well to this leisurely approach to shopping. 345. Odds and ends of inventory, damaged packages, etc., on a porta ble table, are wheeled to the vicinity of the front door whenever it be comes sufficiently loaded. A sign assures shoppers of savings of 50 per cent or more from the original price. 346. Instead of a few large contest prizes, try a large number of smaller, but significant prizes. One store offered 10 lucky couples a week end at the fanciest local hotel. Entries broke all previous records. 347. During a clearance event, appliance salesmen phoned every au tomatic washer customer of the previous year to offer them a matching dryer at the low prices. They pointed out that this was a last chance to get a matching unit before the new "trim changes." 348. With every pair of hosiery sold, customers are given a coupon good for lOtf toward the purchase of any pair of tinted hose within three months of the month stamped on the coupon. The cut-off date seems to result in a higher percentage of redemptions. 349. The service agreement is looming as an increasingly important competitive tool, and profit tool too. As appliance possession by shop pers grows (and repair bills mount) the dollar value of the service agreement will soar. 350. Provisions for customizing are destined to become vital to many



ready-to-wear operations. These will range from simple personalization to complete custom-made with all gradations in between. Shoppers have demonstrated an eagerness to pay for custom features. 351. Specials at a discount outlet were marked in red pencil. This was dramatized to shoppers by giving everyone a red pencil as he en tered. 352. A perfume atomizer filled with a featured fragrance is kept by each register and package wrapping area. Patrons are offered a free trial spray of the perfume. 353. "Wee prices during the wee hours" was the theme of a midnight promotion. Free coffee was available to everyone. These late hour events seem to attract a very high percentage of buyers to lookers. 354. Shoppers were offered a slice from a huge birthday cake. Baked inside the cake were hundreds of capsules containing free gift certificates. 355. A cooperative promotion by a group of fashion merchants in volved each to the extent of offering spectacular values for a different single hour of the day only. 356. Huge overhead mirrors in one store helped focus attention on featured items. It also provided many shoppers with a new and fasci nating perspective. 357. Sale notices to former customers are hand signed by the sales man who made the original sale—interesting to note how many shoppers appear with that card in hand so they can remember the salesman's name. 358. Gift business is both stimulated and speeded by pre-gift-wrapping the more common gift items and putting them out on open display be neath opened packages. 359. A special (and expensive) hand embroidery and monogramming service is available at one blouse counter. Demand for the service proves that shoppers will pay to be distinctive. 360. Orange is the "special" color at one store. All items on special and all store brand merchandise is price marked in this color. Amazing how those orange price markings move. 361. Beating last year's sales figures is easier when salespeople have a stake in the outcome. Offer bonuses based on each clerk's excess over his previous year's sales record. 362. This retailer urges shoppers to "share our coffee break any morn ing from 9:30 to 10:30." Morning traffic climbs steadily. 363. The fashion committee of a store's "Career Girl Club" makes monthly selections in several ready-to-wear categories. These are featured in advertising, windows, and in the store with large hang tags reading: "Career club selection of the month."



364. A merchant capitalized on the unique appeal antiques hold for women. An event was staged featuring "Old fashioned" prices. Doz ens of antiques were used as display backdrops. At the end of the event, these were given away in a huge shopper drawing. 365. Try giant size "sale" tags over a foot in diameter and in brilliant color. The mass impact of the huge tags draws top attention. 366. Power tool gifts are sold with a free "instruction certificate" en titling the bearer to a series of three classes in woodworking with power tools. The technique seemed helpful in deemphasizing price. 367. Shoppers are becoming increasingly careful about warrantees. Try countering this with a personal store endorsement. "Blank's un conditionally guarantees these appliances for six full months." 368. Items of particular interest to men are grouped in a special sec tion called "Man Country"—an interesting way of heightening male appeal. 369. Charity tie-ins are often good. They're even better when they simultaneously retire old merchandise while selling the new. A charity coat sale offers special reductions on a new coat when a serviceable old coat is turned in. 370. Restocking clerks receive an assist from actual photographs taken when the section was properly and fully stocked. There is a different photo for each shelf section. Restocking is speeded considerably. 371. Merchandise displays which start at floor level are attractively set off by standing them on a square of bright carpeting. 372. Ever try finding small items in your store—like toothpicks? Try it. Then picture the problem your customers have locating these small items. Then solve that problem for customers. 373. A 60th anniversary celebration was celebrated with a gold star bonanza. Paper stars were pasted on 60 different products throughout the store, each an excellent value. Customers correctly listing all the gold star items were given a surprise gift with a retail value of over $1. 374. Stag night at one specialty shop was scheduled from 9 P.M. to midnight. Crowds grew steadily almost up to closing time. 375. One dealer puts a huge "guaranteed" sticker on every appliance restating the manufacturer's guarantee in terms the shopper can under stand. Guarantee provisions are more often underplayed than overplayed. 376. As a part of its penny sale, one market gave a shiny new penny to every child passing through the check-out accompanied by an adult. 377. Vitamin plans which call for a supply to be delivered regularly and then charged to the customer's account—all automatically—are catching on. In discussions of cost, only the daily cost is mentioned.



378. Before taking leave of a customer, salesgirls offer them a piece of candy from an attractive box of brand name chocolates. What better way of demonstrating hospitality? 379. A carpet dealer and a drapery shop have an interesting exchange agreement. When either makes a sale, he sends a swatch of the material tagged with the customer's name and address, plus details of how the material was used in the home, to the other store. 380. Gift suggestions for "bosses" faced with the problem of finding a not-too-personal gift for their secretaries, were grouped at a special counter with telling effect. 381. The "sample bar" is right next to the courtesy booth at one store. Booth hostess is briefed on new products and samples so she can an swer customer questions—point out important features. 382. Reduce burglary incentives by keeping overnight cash in your bank's night depository. It's a no-charge service. 383. The amount of merchandise which can be carried in forward stock is increased, by first laying one row of packages flat on the shelf, then topping it with another row arranged upright in the usual manner. 384. A group of model galleys set up in the window drew heavy at tention from boat, trailer, and summer cottage owners. Try catering to the special needs of these two-home owners. 385. In an effort to give special recognition to long-time customers, one store gives distinctively colored charge plates to shoppers of five, ten, and twenty-five years' standing. A colored plate notifies the salesclerk to give this customer special attention. 386. Appliance salesmen exceeding a basic quota receive credit cou pons which can be redeemed for either $1 cash or $1.50 worth of mer chandise off the floor. The more appliances salesmen have in their own homes, the more effective job they can do. 387. Typewritten reminders of logically related items are affixed to the shelf edging in dozens of in-store locations. When the shopper glances down at the price, she is automatically reminded of the related item. 388. During an anniversary sale, every shopper was handed a balloon as he entered the store. Inside the balloon was a slip offering a special discount of from 5 to 50 per cent. Each slip was also numbered. Lucky numbers (posted on a bulletin board) received a free birthday cake. 389. Try an after-hours opening for a specific group of working women such as telephone company workers, insurance office typists, and secre taries. High attendance is virtually assured. 390. Exactly 103 pieces of surplus merchandise—to be sold at or be low cost—each piece identified on the floor by number, drew crowds of shoppers. Putting some sort of limit on a sale may pay dividends. Shop-



pers have become suspicious of sales which have no discernible end. 391. A promotion of travel items, geared to the special needs of late season vacationers, met with an enthusiastic response. An appeal to a reasonably substantial minority is almost always productive of sales. 392. A drawing for a litter of puppies has proved to be immensely popular. The pups are kept in a special pen in the parking lot for a full week before the Saturday afternoon drawing. 393. "The boss is away" is an idea with so many possibilities for semihumorous promotion that it almost never fails. One ad began: "The boss is away—come in now and take advantage of his absence—when he sees what we have done to his prices, he'll never dare to leave again." 394. A practical demonstration to salespeople of the potential in re lated selling is achieved by critiquing sales checks. A "sales expert" goes over the days' sales checks with the expert pointing out the many related item possibilities and how she could have sold them. 395. Very special pricing based on selling home laundry equipment two at a time drew a heavy response. Customers worked hard persuading friends and relatives to take the other unit and share the savings. 396. There is considerable competition developing for stores to have the most comfortable rest area for customers. Soft chairs, a table with magazines, a coat rack, ash trays, and perhaps even free "Cokes" or coffee are items to consider. 397. Gift items in packages which are often worth as much or more than the item itself are in a strong trend. Evidence that this trend will extend to home use of ultra-elaborate gift wraps is mounting. 398. Impromptu display techniques foster a low price reputation. Try taking regular manufacturer shipping cartons for deal merchandise, crayon the price on all four sides, cut out the top, and place the entire case on the aisle floor alongside a gondola baseboard. 399. A blackboard in the window is used to announce new specials. Colored chalk identifies items as "today only," "till noon," or "this after noon only." This effectively gets across to the shopper that here are items which just couldn't wait for formal announcement. 400. Lest she forget—one shop takes a Polaroid snapshot of the cus tomer in a dress she's a bit doubtful about. Has the print ready for the shopper before she leaves the store. 401. Special pricing on full case purchases of paper goods boosted the average ticket on these items. They were sold in both the store and the parking lot. The store's ad suggested that shoppers "split a case with a neighbor." 402. A dealer listed exactly 101 items for immediate clearance. He then identified each item in the store by number and made reprints of



his ad available at the door. It's amazing how many women read that list from beginning to end. 403. One merchant had salesmen make a note of the first question customers asked about certain specific items. He tabulated the results and then arranged to answer the most common questions on the item's hang tag. He now feels that there are far fewer walk-outs. 404. Salesclerks approach customers with "Good Morning! My name is Miss ------, may I help you?" A smart move—the sales potential in the personal touch is rarely capitalized upon. 405. Newest addition to one store's courtesy booth is a part-time con sultant on any homemaking problem. During scheduled hours, shoppers are free to ask and get answers to almost any question on homemaking. 406. Amateur pilferers are timid souls. A sharp reduction in shrinkage at a health and beauty aid section followed the installation of a sign reading: "This section protected from pilferage by Scandar"—a com pletely fictitious service, of course! 407. Serviceman productivity was stepped up sharply when these men were offered a commission on all service charges over a basic quota. They are also given a "finder's fee" on leads for new appliance sales which pan out. 408. An optional custom fitting service has created a distinctive "point of difference" for one blouse department and boosted their average ticket as well. 409. Stock bins and drawers in many stores are being equipped with see-through plastic fronts. Frequently customers are able to spot an item that they would have been unable to describe adequately to a clerk. 410. The difference in cost between an ordinary sign and a truly informative sign is minute. Yet signs which give important information have many times the sales effectiveness. 411. A dealer offered shoppers a ten-dollar credit certificate just for coming in and watching a demonstration. The credit was good for six months toward the purchase of any major appliance. 412. The "President's Luncheon," a swank lunch and fashion show for the first ladies of local women's clubs, is an eagerly awaited annual affair—and how they talk it up to their club members afterward. 413. Too small to have a full-time demonstrator, one shop has a "demonstration center" where customers are urged to test items to their own complete satisfaction. 414. Offers involving free gasoline are becoming popular. Response was extraordinary when one store issued coupons good for 5f worth of gas at a nearby station, with each dollar of purchase over $5. 415. Suggestion selling is boosted by providing salespeople with con-



stant reminders and suggestions. One store has a prepared list of "must suggestions." A copy is placed in each sales book, on each cash register, and in several places at each wrapping counter. 416. "Wise shopper money" is given to shoppers with each purchase of specially marked merchandise. The "money" can be spent on any item in the store. One store gives it with every item carrying the store brand. 417. As more ready-to-wear departments move toward some form of check-out counter, techniques must be developed for capturing the sale of items the shopper had planned but temporarily overlooked. One of the best—some form of roving hostess to run the shopper's errands. 418. Small sizes were described by one store as "sized for convenience" and to make the price attractive, the store priced them 3 for $ -----(the price reflected a variable saving for each package). 419. For men shopping for gifts for women, this store furnishes a "wife-size picture." Man notes wife's measurements, her china designs, etc. Good idea! 420. Special credit plans for teen agers are becoming a favorite de vice of stores attempting to develop firm shopping habits among teen agers. Among the inducements used to enroll youngsters in credit plans: an L.P. "Rock 'n' Roll" record, a lipstick case, a monthly "charm school" bulletin, and a no-interest credit plan. 421. Most women like to think that they are highly discerning shop pers. That's why an ad which stated "experienced shoppers will imme diately recognize these to be unusual values" pulled well without men tioning a single price. 422. A single package in a wire holder extending about eight inches out from the shelving has turned out to be an effective way of flagging attention. It is also an interesting way to relieve the monotony of militar ily precise rows of packages. 423. There is a small group of fashion addicts comprising perhaps no more than 5 per cent of a store's customers who account for about 20 per cent of fashion business and very nearly half of really high fashion busi ness. Try giving them a bit of red carpet treatment. 424. A round table with a mirror surface is used by one outlet for the display of new products. A card by each new item gives its price and regular in-store location. 425. It defies all logic, but shoppers can be persuaded to walk in through the back door at hours when they wouldn't be dragged in the front door. A 10:00 P . M. to 1:00 A. M. sale drew heavy buying traffic. Admission was by the back door on presentation of the store's announce ment ad only. 426. A fashion "before and after" was handled in the window using



two identical and identically dressed manikins. The difference—one was fully accessorized, the other not at all. 427. A certificate good for a free 5 x 7 child portrait brought shop pers to the store at least three times: Once to get the certificate, once to have the picture taken, and once again to pick up the portrait. 428. Coordinates were dramatized by dropping a wire from ceiling to floor. Coordinated items are attached at various heights on the wire. 429. A dealer is moving more top price-line ranges since he began referring to them as "Gourmet Quality." A large gold foil label with that legend is attached to each range. 430. A large glass container was partially filled with a number of old discarded billfolds. Signing urged shoppers to drop their old billfolds in the jar, and stated that when full, a drawing would be held for the "Sor-riest wallet of them all." The winner gets a full refund on his new wallet purchase. 431. A packet of promotional material on new sets accompanies every TV service bill. The invoices are stamped: "This bill when receipted may be presented for full credit on the purchase of a new set within 90 days." 432. Television service men leave an impressive inspection check list, appropriately filled out, on each set they work on. Customers will com plain less about the charges when they know what work was performed. 433. Using the theme "Intimate Dining" one store effectively tied together "at-home fashions" with table settings of fine china. This store also made available menu suggestions based on exotic and gourmet foods. 434. A tremendously convincing room planning and decorating service is achieved through Polaroid photos taken of the customer's room and corresponding photos taken in a model room. 435. The Hawaiian luau is becoming a popular form of home party. It offers all kinds of promotional opportunities for retailers, including the staging of giant luaus in the parking lot. 436. Home demonstrations of stereo are becoming more common. One dealer has a sales clincher—he offers to throw in a "demonstration library" of stereo records if the customer keeps the set. 437. Massed colors dramatically sell fabrics via window display. Solid windows of various fabrics in the same color highlighted with just touches of contrasting shades are real stoppers. 438. The courtesy booth at one market doubles in brass as an informa tion center. Studies indicate that as many as three out of four customers have trouble locating at least one of the items on their shopping list. 439. A semicustom ready-to-wear operation works this way: Customer



measurements are taken—kept on file. Shopper selects style from certain basic designs and chooses fabric from a truly huge selection. 440. People love to gamble—particularly if there is no risk of losing. Shoppers at one market were handed a numbered ticket as they entered the store. They could then spin a roulette wheel. If the wheel stopped on their number or an adjacent number they won a free list of items. 441. Here's a good way of boosting your store's male appeal: schedule a turkey carving demonstration for every hour on Thursday evenings. Offer free turkey slices on a piece of party rye free to shoppers. 442. Try turning your front window over to a display of paintings and sculpture by local artists. It will attract unusual attention. 443. Figure the net profit contribution of an additional dime on every sales check. Then plan a detailed program of related product merchan dising to get that additional ten cents. The possibilities for combining items are unlimited. Keep testing. 444. When an alarm goes off at its 10 check-outs, every customer passing through the check-out at the moment gets a free item. Nobody knows when the bell will toll. 445. A reasonable semblance of order is maintained in the vicinity of the snack bar by the addition of a "shopping cart garage." The "garage" is a stanchioned-off area in full view of the snack bar. 446. The outdoor display of furniture is becoming increasingly popu lar. One merchant went so far as to remove the front of his windows so street traffic could walk right into the window area without entering the store. 447. One store sends customers with good credit ratings a "privileged customer credit card." Privileges include up to six months deferred billing without interest charges of any kind. 448. Newspaper advertising offered carpet remnants for doll houses, boat cabins, closets, etc., for free—pulled traffic and led to sales. 449. Coffee break time at one store is put to good advantage. Each morning one salesman is named to tell the group about his most unusual sale during the previous week. 450. A portable display of traffic appliances is kept in the middle of the major appliance section. Salesmen find it simple to direct the cus tomer's attention to the smaller items after a sale has been completed or when the shopper is about to "walk." 451. Everybody likes to guess, and that human trait can be the basis of exciting promotion. Let customers try to guess when the first 90 or 100 J degree day will arrive. 452. A life-size cartoon-type figure cut out of wood and holding an



open newspaper (also a plywood cutout) is used as a bulletin board for the store's current newspaper advertising. 453. The purchase of a piece from a coordinated furniture collection in one outlet sets in motion a follow-up system which brings additional pieces to the customer's attention once every six months. 454. A clown has become an institution at one store, a spotted dog at another. They appeal to oldsters as well as youngsters. Why not develop a live character for your store? 455. An appliance store frames pertinent cartoons and stands them on various items. A furniture outlet's salesmen wear "Joke" pins on their lapels and a bedding store dresses its salesmen in the loudest pajamas available for special promotions. 456. "Take Your Choice of These Varieties," a variation on the mul tiple-selling concept, is becoming increasingly popular. For example, five or six frozen food staples are offered for $1. 457. Surplus stock drawers built into the shelving baseboard elimi nate some of the clutter usually associated with midday restocking. 458. Balloons as a check-out gift for children are proving more ac ceptable to many parents than various types of candy. 459. Wall murals or large photographic blow-ups are frequently more effective than signs in identifying major departments to customers, many of whom may have left their glasses at home. 460. Coloring sets and crayons make a big hit with youngsters. Several stores now hold coloring contests, with art teachers as judges. Crayons and books are usually given free; one store tied them to purchases over a stipulated minimum. 461. Wall space above a certain height in most stores tends to be un used despite its high promotional value. Don't permit it to go to waste, and don't surrender it completely to "Art." 462. On-premise food consumption jumped when a portable coffee cart began circulating throughout the store. Coffee, tea, coke, donuts, and danish pastries were available. Prewrapped sandwiches were added during lunch and dinner hours. 463. The shopper service booth has been made the focal point for testing customer reaction to various policies, etc. The booth attendant is instructed to ask patrons specific questions after the reason for their vis iting the booth has been attended to. 464. All private brand merchandise is price marked with a distinctive color. Shelf strip pricing is done in the same color. This store insists that customers quickly begin to associate savings with items marked in the special color. 465. Television repairmen fill out a special form when they service a



set that is over five years old. The form is turned over to a salesman who calls the customer to suggest a new set. He also offers to tear up the repair bill. 466. Try naming your aisles after local streets rather than with numbers or letters. Customers remember them better and it improves the community character of your store. 467. Ever try the floor as a merchandise fixture? One shop displays its handbags on large ovals of carpeting placed beneath its manikin displays. Finds the techniques very effective. 468. Ultramodern fashion department decor may be out of step with customers' preferences. Their choices for home decor have shown a strong trend toward Early American and period decor. 469. Problem sizes, too small as well as too large, find it increasingly difficult to find adequate selections. They respond enthusiastically when a promise of real choice is extended. One shop builds a collection of problem sizes—stages a full price promotion for them during normally slow periods. 470. Impulse is spurred by the unusual. Moving merchandise out of its regular section for short periods of time exerts a beneficial effect— even when it is not tied in with a strongly related product. 471. Despite usual pilferage fears, a ready-to-wear shop displays slips, bras, girdles, etc., within easy reach of fitting rooms in rear of store. Store owner knows volume has increased, has no reason to believe pil ferage has jumped. 472. Sections devoted exclusively to travel needs are becoming justi fiably popular. A substantial portion of our population is traveling con tinually. _ 473. "Once again, cash talks." An appliance dealer offered shoppers a special deal on the basis of cash in full with each order. Many custom ers prefer to buy for cash—more would if the incentive was there. 474. A "wear warranty" is issued with every piece of carpeting by one floor covering dealer. Warranty period varies by type of carpeting and place of installation. 475. There has been a distinct pick-up in customer demand for orig inal paintings. One store arranges for local artists to bring in pictures suitably framed. These are placed in room settings and sold at a price set by the painter. The store collects a commission. 476. One store has a large blackboard on which the latest official weather forecast is chalked! 477. An unsightly pillar was concealed by throw pillows suspended floor to ceiling around the pillar by wires. A dump bin at the base con verted the display into a self-service fixture.



478. There are signs that the so-called "Private Sale" for charge ac count customers, announced by a post card mailing, is losing impact. For a special fillip, try phoning each of these customers. At the same time give them some specific merchandise information. Ask if they have any special needs. 479. After the "back room" sales training is completed, new employees are assigned to highly experienced salesclerks for several days of on-job training. The "coaches" receive extra compensation for the time in which they act as instructors. 480. A six session fashion clinic for working girls was run at 12:15 P . M. each Wednesday for six weeks. Sessions were held on: proper fit and foundations, fashion silhouettes, cosmetics, fabrics, accessories, and a summary of the course. Box lunches were available for 50#. 481. Ever try selling two television sets at one time? One dealer of fers a second portable set at half price with the purchase of another set at full price. There has been a vast increase in the number of two set and three set homes—and the trend is still in its infancy. 482. In addition to their regular shelf position, all new items are given a full month's display on this market's "New Item" fixture. A coding sys tem for items on this fixture demonstrated that a surprising number of shoppers pick up items they bypassed on the shelves for no apparent reason other than "newness." 483. A shop doing an extensive in-home selling job finds that it can speed up the customer's decision by arranging sample books by color rather than by texture or quality. They also find that it is somewhat easier to trade up to better qualities using this method. 484. Is it in good taste? That's the sales-killing doubt which creeps into customers' minds more frequently than any other. Try countering this with occasional "Best-of-taste" collections. Promote interior decorator services. The use of an interior decorator has become a status symbol. 485. The search for greater store individuality is turning more atten tion toward wrapping materials and particularly gift wraps. Packages which identify the store without using a large logotype are particularly sought after by shoppers. 486. Six-foot-high secretarial pads with a giant pencil poised above shorthand copy formed the window backdrop for a special pitch to secre taries. Interior display cards were done on actual steno books. It pays to talk the language of your customers. 487. Before remodeling was begun, customers were shown the plans and asked for specific suggestions as to what they wanted. Several of the planned improvements were so indifferently received that they were dropped. A few others were added.



488. A case lot sale which started at the store's regular closing time and went on right through the night pulled an amazing response—even during the wee hours of the morning. Items were sold by the full case only. 489. Car servicing while you shop is one way of making the customer a captive for a length of time. Cars are picked up and returned within the hour. The key is left at the check-out with tile charges. These are added to the shopper's check. 490. A lending library of children's books gets a heavy play. Children are given their own library card. Here's a fine way of keeping youngsters busy while Mom shops, and it certainly is an appreciated service. 491. A huge bulletin board—over 20 feet in length—is used to remind customers of in-store specials. Lettering is large enough to be read throughout most of the store. 492. Boats—particularly the plastic run-about variety—have shown themselves to be an attention-getting display bin for bulk displays of anything with even a faintly nautical origin. 493. A class of third graders was taken on a store tour. At the con clusion of the tour, each child was photographed and the pictures put on display. Shoppers were asked to vote for the photo they liked best. Naturally family and friends turned out in force to vote for their favorite. Winning photo had a spot in the store's next ad. 494. Develop a more personal relationship with customers. Policy at one store includes: salesmen will introduce themselves when approaching customers; a personal thank-you letter hand signed by the salesman after each sale; a hand signed Christmas card filled out at the time the sale is made and then filed away for December mailing. 495. The salesgirls in one hosiery section are sent out occasionally on slow days to "shop the competition." In addition to acquainting them with what competitors are selling it has the added advantage of making them feel like V.I.P.'s. 496. One market manages to start the late week evening rush a bit earlier by offering a free hot dog to everyone coming in between 5:00 and 7:00 P.M. 497. A store features a "one-of-a-kind" boutique—emphasizes that items found in this special section are absolutely unduplicated anywhere. 498. Some stores report a midmorning pick-up due to quick shopping by women workers who rush out during the coffee break. Coffee breaks are getting longer—especially for women. Coffee-break shopping may pick up still further. 499. A premium grade meat is identified in the meat case by a special gold price tag. Copy on the tag reads: "This superior quality meat is



unconditionally guaranteed. If for any reason it does not prove fully satisfactory, return this tag for a full refund." 500. Shoppers are showing a distinct tendency to trade themselves up to better quality products. One store capitalizes on this with a private brand line priced well above that of the national brands. 501. When customers hurry to secure a place in the check-out line, it means their shopping trip has been cut short and the average sale must dip. One market featuring fast check-outs has a 5-minute waiting limit guarantee. When a snag develops (very unusual), the customer gets a free gift. 502. To build early week volume, one store offers a "surprise package" worth at least 50tf with each purchase of $5 or more. 503. This store's P.A. system is used to introduce store personnel to shoppers as well as timely specials. The announcer will introduce a sec tion manager, for instance, tell of his qualifications for the job, and follow this up with an announcement of a special. 504. Actual cash awards to shoppers holding a lucky number have proved to be a powerful traffic lure although the dollar amounts are small. Shoppers must be in the store when a buzzer sounds to be eligible. 505. The "door opener" at one store opening was a free bundle of fire place wood. It drew phenomenally. 506. A discounter rented a parking lot for a huge promotion. Truck trailers were parked around the perimeter. Steps were erected to each van. All selling was done direct from the trucks. Special delivery trucks were on hand—so were porters to help customers who wanted to haultheir-own. 507. Capitalize on the appeal of imported merchandise by setting up a small canopied bazaar stocked exclusively with imports within the main fashion section. 508. Gift wrap samples are on display at each fashion counter in one store. Signs offer to wrap any purchase at prices that vary for each wrapping. 509. A furniture store set up a series of model rooms for children-invited both parents and children to attend a special "Open House." Pop corn, soda, etc., were available on a "help yourself' basis. 510. Layaway this idea for winter: Put electric fans on a snowbank. Hook them up. Then put up a sign reading: "How would you like to have this cool breeze next summer?" It will move fans—in midwinter! 511. Comfortable seating, free refreshments, and a subdued atmos phere are the keynotes of new specialty operations. They appeal to those refugees from production line self-service departments. 512. A speciality shop speeded its summer clearance by grouping



merchandise into identical price groups instead of groups of identical items. They then offered any two for $ ________ 513. The guarantee is now assuming new merchandising importance. An appliance dealer, for instance, states: "never a repair bill in the first full year." A furniture shop guarantees that wardrobe drawers will not stick for the life of the item, and a fabric shop warrants their drapes and slip covers against fading for five years. 514. Lighted color transparencies of tempting cooked foods scattered throughout the range display area built interest and markedly slowed down the "just browsing" customers. 515. Fast installation can generate prompt customer action on carpet ing. Referring to its twenty-four-hour installation service one carpet shop advertised "See us today and your new carpeting will be installed be fore your guests arrive tomorrow." 516. Dramatic lighting effects are a growing decorative trend. Empha size the ability of light to change the character of a room: warm, cool, etc. 517. To insure that customers had the essential information necessary to make a buying decision, one store included a measuring chart in its lamp shade advertising. 518. A merchant arranges to have at least one demonstration every day of the week and publishes the demonstration schedule in his news paper advertising. Finds many shoppers showing up with the schedule in their hands. 519. A housewares retailer includes a copy block in every electric ap pliance ad which promises to gift wrap any item, remove the price markings, mail the package anywhere with the customer's card enclosed, and include a special guarantee card assuring the recipients of complete service no matter where they live. 520. The decorating service at one furniture outlet arranges to take pictures of the customer's room with a Polaroid camera. Then, on return ing to the store, they dummy-up a similar room and photograph it too. The customer sees "before and after" pictures in advance of buying. Very convincing. 521. The popularity of the compact car has created an opportunity for home furnishings promotions built around compactness. 522. One appliance store prices all articles on this basis: "Picked up at our loading dock in a factory sealed carton." Additional prices for such items as delivery, installation, etc., are posted separately. 523. A "lose leaf' type of wall fixture has developed into an effective merchandiser for small accent rugs. The actual rug is shown on one side while correlated colors are shown on the facing "page."



524. Coffee and doughnuts chalked up a success in an electric ap pliance promotion. Electric coffee makers and deep fryers were used to make the snacks on the spot, show how good they are and how easy to make. Idea can be used for other electric housewares. 525. Major-appliance customers were offered an opportunity to rent any appliance for periods of from three to six months—and then apply the rental to the purchase price in a "Be Sure before You Buy" promotion. 526. Fine art and fine furniture naturally go together. Paintings and reproductions are a vital part of any home decorating scheme and can be sold right along with furniture, carpets, draperies, etc. 527. Try running newspaper ads with photos of in-home salesmen. The men will love it, and homeowners will get to know them, which is a decided advantage. 528. Charge plans for teen agers are increasing in popularity. Gen erally they do not require the cosignature of parents but the credit limit is kept under $25. They are particularly effective when combined with a store sponsored teen club. 529. One store offers three-hour delivery service to guests at hotels or motels and extends charge privileges to anyone who holds one of the ac cepted nation-wide charge account cards. 530. Before delivering furniture, a large store calls to ask permission to bring accessories such as lamps or mirrors. It results in many sales. 531. Have all manufacturer pamphlets and store literature available at a "free information center" on a help-yourself basis. 532. A carpet dealer set up a special display to help clear up the vast confusion which exists regarding fiber content. The display included samples of all the major types and blends together with a brief explana tion of each. Above the display, a chart rates each type according to soil resistance, durability, resistance to matting, etc. 533. One discounter reasoned that, since most new home owners start off with new appliances, big housing developments would think about replacements almost simultaneously. Accordingly, he schedules, at inter vals, a highly personalized approach to these groups. 534. A drawing every day of the week for a free beauty salon perma nent has been successful. 535. A housewares dealer impressed customers with the tremendous selection of housewares available during his annual sale by adopting a classified ad format, in which all the items were listed alphabetically with appropriate cross references. The location of each item in the store was included and customers were urged to clip the ad and use it as a shopping list. 536. A silver foil seal imprinted with the words "Best Value" is affixed



to large-size packages by clerks during the slow selling periods. Its effect on large size movement has been dramatic. 537. Credit accounts for teen agers are set up on an "amount not to be exceeded basis." The size of the line of credit is determined in con sultation with the parents. Parents find the promise of an increase in this amount is a top incentive to teen agers. 538. Couples are encouraged to shop during a store's evening hours with this offer: "Make any purchase and we'll treat you to the late show at the movies tonight." 539. "Pop in and pick up a ________ " This store ad told how a par ticular special was available for really fast shopping—was prewrapped, right near the door, and no waiting for service. 540. A store has a "space ship" play area to keep children occupied while Mom and Pop shop. It takes pictures of the children in the "space ship" and offers prints to the parents free. 541. A shop used antiques regularly as display backdrops. Occa sionally, customers asked if the antiques were for sale and after hearing the price (high), frequently walked out with the item. Accordingly, the store experimentally priced all the antiques in customer view and now does a tidy and very profitable antique business. 542. To generate traffic, a store offered to take a baby picture for "a penny a pound." Additional poses were available to mothers at regular prices. 543. Customer dissatisfaction resulting from improper laundering is increasing in direct proportion to the vast increase of fibers and fiber combinations. So—one store reprinted the laundering instructions for the more common fabrics and suggested to customers that they tape the in struction sheet to their washing machine. 544. A fashion show in which all the models are store customers has been uniquely successful. One model was a grandmother over 70. Each model received a free gift and, of course, a tremendous psychological lift. 545. During a drive for new charge customers, one store put charge applications on every counter, near every cash register, at stands near the doors, and in every fitting room. When ringing up a sale, clerks were in structed to ask customers to open a charge. Ball point pens which the customers could keep were provided for use in filling out the forms. 546. A successful stag night program included door prizes, a free coatchecking service, free cigarettes and coffee, drawings for prizes based on purchases, P.A. system announcements, attractive hostesses, and special gift wrapping tables. All in all, a formula for success at any time. 547. A store invites women's groups to tea on slow afternoons—works in new-product demonstrations.



548. A corset shop publicizes its sales help as "graduate corsetidres" —emphasizes that they have taken special courses in fitting foundation garments and continue to take special courses to keep up to date. 549. A do-it-yourself "cost calculator" boosted sales. It appeared in a newspaper ad, helped readers figure out for themselves the cost of carpet ing rooms of various sizes. 550. Classes in gourmet cookery for men only, sponsored by a food market, were concluded by a final exam in the form of a contest. Each participant was required to prepare a complete meal. A judging was held and appropriate prizes offered. 551. Courtesy bulletin boards where customers can place notices for the things they want to buy, sell, or swap are good community relations. One retailer also supplies index cards, pencils, and thumb tacks as an ad ditional service. 552. A unique fashion show was devoted to teaching customers the tricks of accessorizing smartly. All models were selected from the audi ence and the accessorizing was done on the garments these customers were wearing. 553. Retailers in all sections of home goods report that young couples are responding to the basic thought that home furnishings should be changed as their tastes and income change. Cars are bought every two or three years; why should home furnishings be forever? 554. A "World of Hospitality" was the theme for a display of housewares from all over the globe. 555. Try an invitation to browse. A furniture outlet specializing in Early American headed their ad: "If you love Early American, you'll love browsing in ------ 's.w 556. A blouse promotion was helped by having salesgirls wear the promoted blouses during the event—and then giving each the blouse at the end of the promotion. 557. A home furnishings dealer invites all of his customers of the last year to a free dance staged in a fine ballroom. He says it pays off within a month. 558. Fashion department employees in one store not only receive in struction in basic fashion trends but are also briefed on the fashion features of new merchandise as it is received. 559. The entertainment spectacular as a promotional device is finding increasing favor. Most popular devices so far are flower shows, musical exhibitions, circus acts, and dance groups. 560. A dress shop speeds clearances by encouraging sales of multiple items to each customer. Their policy: Any second "sale" garment for $10 regardless of the marked price. 561. There is a distinct trend developing in home furnishings toward



period decorating. Increased attention is being given to period matching—but no single period is recommended. 562. A promotion was built on items priced at 19^ and 58*. Customers whose bills ended in either amount received a prize. 563. Sawdust Party—a new idea for special events for do-it-your selfers. A typical program includes a film on woodworking, demonstra tions, etc. 564. The theme "Fresh as a Daisy," plus thousands of dewy daisies, and tied up with "daisy white," helped put over a summer fashion pro motion. 565. Monthly fashion shows are a feature of one store's teen club. The girls do the modeling—even help prepare the fashion commentary. Latch on to the insatiable interest in fashion shown by so many teen agers. 566. A specialty shop offers all famale office workers a Career Girl Credit Account—a plan tailored to the requirements of the working girl. 567. Having all salesgirls wear native costumes during an Italian im port event pleased the salesgirls and appealed to the shoppers. 568. A women's store celebrated its birthday by featuring a huge cake in its window. Customers were asked to guess how many pounds of sugar had been used in the birthday cake. The winner was given a large cake. 569. Here is a promotion idea based on telephone numbers. Each day, a number of items in the stores were tagged with various local home tele phone numbers. A shopper whose telephone number corresponded to one of the tagged numbers got the item at a fantastically low price. Example —$10.98 dress for $1.10. 570. The "Peeping Tom" window is not new, but tying it up with the twist dance craze is new. It was done this way: The window was all frosted—except for the peepholes. A sign urged passing traffic to "Look —see the new twist." Foundation garments were displayed on animated manikins. 571. To promote mail orders, this store ran a full-page newspaper ad using both sides of the page. One side showed about ten items, each in a box. The other side had a coupon backing up each item. Customers filled in those coupons on the reverse side for a new high in mail returns. 572. A major-appliance dealer offers cash awards to customers suggest ing names of prospects. 573. Color consciousness is still growing. A specialty shop capitalized on this by keying its accessories promotion to just one color at a time. 574. A "Feed the Family Free" event gave to each family on a shop ping night a ticket for each $3.00 in purchases. The tickets were re deemable for a hot dog, doughnut, soft drink at special refreshment stands set up in the store. 575. A full-page newspaper ad, showing photos of over twenty sat-



isfied customers and reproducing a signed testimonial from each, produced excellent leads and splendid store traffic. 576. Now a department store is offering special decorating advice for men. Why not? The idea appeals not only to bachelors;—but also to mar ried men who obviously are doing more and more family shopping. 577. Tickets for baseball games continue to serve as excellent pre miums. 578. A new room is emerging. It's the balcony room. In some areas, the balcony in apartment houses is in a boom stage. Items must be com pact; they must be designed for easy winter storage. Check the balconies in your trading area—then check your inventory. 579. A store that adopted a check-out system decided to increase its charge authorization limit. It normally approved sales on the floor up to $20 with a chargeplate; now it has moved up the figure to $30. This is a vital move in turning to check-outs; give it ample thought. 580. A women's specialty store permits only card-carrying customers to shop in a new posh salon. The salon features high fashions. Cards are numbered—only a limited number are issued daily. 581. After-hours sales have worked well for hard goods; now there's evidence that they will work for ready-to-wear outlets too. One specialty shop opened its doors at midnight to show a group of "bewitching" fashions.


722 Infant Trends That Will Play Adult Roles in Moving Merchandise

Old Man Department Store Spawns Some Infant Trends

The traditional department store is the granddaddy among our mass retailers. It has had an outstanding record of conservatism, of nearsightedness, of too little too late for several decades. But even old man department store is spawning some infant trends—several that belie its age and several that will emphatically shape the policies and practices of most of its suppliers. 1. First and foremost—the department store is finally taking steps to slice the time that elapses between the moment the shopper has decided to make a purchase and the conclusion of the sale. Until very recently, it took just about as long for the department store to complete the sale of a single pair of nylon hose as the sale of a chinchilla coat—that is, after the customer had decided to make the purchase. This is being done in various ways: The major procedure involves changing some departments over to self-service, including either check-outs or cash-wrap desks. The number of traditional department stores moving in this direction is increasing rapidly; the number of departments being changed to self-service is multiplying. In price-promotional department stores, this trend is becoming almost storewide; in the prestige type of department stores it is most common in such departments as the basement, toys, notions, other smallticket and staple classifications. Self-service packages are consequently winning more favor in more departments of more department stores. There are also some experiments with new types of order books —simplified order books that lessen the time factor in writing up an order. Efforts are being made to simplify the total charge-account and credit-account procedures.



2. Another infant trend among traditional department stores began with recognition of the obvious fact that they were losing big gobs of young customers. Their younger customers were flocking to the newer mass outlets, including the discount outlets, and not solely because of price. Some department stores discovered that their "im age" was that of a dowager type of retail outlet. Consequently, there is a move now to court the younger generations—teen agers, the young marrieds, etc. This involves both a new fashion vitality and a more vibrant store atmosphere. It means some changes in buying programs—you do not buy the same lines for dowagers that you do for young people. This infant trend promises to rank importantly in the selling and promotional programs of many department store resources. 3. While the waning of the independent department store isn't an infant trend, it is still a small trend in comparison to the pace at which the traditional independent department store will phase out over the next few years. Independent department stores will, in sev eral years, account for less than 25 per cent of total volume by tradi tional department stores. (And most of that 25 per cent will be done by a dozen giant independents.) Alert resources that formerly con sidered the independent traditional department store a major out let are now assiduously courting both the department store chains and newer outlets ranging from variety chains to discount chains. The day of courting the independent department store is over. 4. The organizational blueprint built around the main downtown store unit is right now just beginning to be changed radically. This had to come about—branch volume is topping downtown store vol ume. Resources who find that the main store accounts for too high a percentage of their total sales will begin to work more closely with branches. Some resources, when introducing new items or lines, will try to wedge into the branches before trying the main store. More suppliers will be shipping directly to the branches—more re source salesmen will be calling directly on the branches. 5. There are signs among major traditional department stores of a trend toward reaching out for more prestige events instead of traditional concentration on price events. One reason: not many de partment stores can compete on price with the new low-margin chains. One example: full-scale promotions of Latin American mer chandise were planned in the spring of 1962 by a number of A.M.C.



stores. These prestige events will tend to be storewide—and resources that come to major department stores with prestige events that will produce excitement, produce traffic, produce sales will win a more attentive hearing than has been the case for years. 6. In the early part of this century, department stores could supply 85 per cent of consumer needs. Then they threw out food, hardware, drugs. Later, some threw out appliances and TV. Now there is a trend to bring back these discarded departments—sometimes on a leased basis. The traditional department store now tends to com prehend that it has been catering to a smaller and smaller percent age of the shopper's needs. A growing determination to reverse this trend is evident. In suburban branches particularly, new departments are being installed—from garden sections to gasoline and tires. They may even add boats, swimming pools, prefabricated houses. This, of course, would mean that some manufacturers whose classifica tions have not been stocked by department stores may now find this outlet more willing to live up to its one-time claim of "everything under the sun." 7. Department stores fought night hours—tooth and nail. Now the two-night opening is common. There are many instances of threenight openings—in New York, for example. There are four- and fivenight openings in a few other cities. In shopping centers, department stores are finally remaining open as many as five nights. Macy's is open six nights in Kansas City and in New Jersey and plans to fol low this same night schedule elsewhere. A few department stores are now open on Sunday. More will follow suit. Morning hours are being cut or eliminated—especially in some shopping centers. Among other things, this is bringing in more young people, more young couples—and that, in turn, compels changes in inventory. 8. The traditional department stores, especially the prestige types, have concluded—and correctly—that this highly affluent age meshes in nicely with their basic policies. They are, therefore, moving to ward still higher price lines, still more luxurious numbers. These outlets are indeed becoming mass merchandisers of luxury lines —democratic retailers of aristocratic merchandise. Some manufac turers of these lines have yet to catch up with this trend. 9. There is an infant trend in many department stores toward new types of service departments, from travel to theater tickets, from



automatic laundry and dry cleaning sections to car servicing, toward rentals, insurance, shoe repair, even mutual funds. 10. "Hundreds" of stores are planning to convert sections of their f acilities into departments which will handle low gross margin prod ucts on a self-selection basis, a May Co. official has predicted. "The trend in this type of merchandising is exactly paralleling the supermarket trend," according to S. J. Schaffer, May Co. controller. "In the next two or three years, this trend will be accompanied by lower margins and lower prices on those items which lend themselves to self-selection and cashier checkout merchandising," he added. Clearly, this trend will affect the marketing programs of many department store resources. The traditional department store, of course, is moving toward the opening of separate self-service check-out discount stores. The Dayton Co., L. S. Ayres, Hudson's, and Wasson's are among major department stores that are heading in this direction. Maison Blanche, in New Orleans, opened three of these units, and other A.M.C. stores, in addition to those mentioned, are tending this way also. Whether this trend will ever get past the infant stage is a moot point at the moment. On the optimistic side is a report from Hudson's. "Conversion to checkout selling has produced a 15% saving in selling costs at J. L. Hudson's Lincoln Park store," Robert E. Sturwold, manager of branch budget stores, said. "The two-level budget branch was converted on July 31, 1961," and since then has "substantially increased its sales." Chorusing Mr. Sturwold's report of self-service success was R. T. Eaton, Vice President for operations, Rike-Kumler Co., Dayton. Mr. Eaton noted that in less than a year of operation, two upstairs departments that were converted to check-out showed gains. In drugs, sales were up 21 per cent and selling cost down 6 per cent. Record department sales jumped 10 per cent and selling costs dipped 5 per cent. But it has yet to be proven that traditional department stores can profitably operate true discount stores. But there is no doubt that, in the stores mentioned, many resources have been given both opportunities and problems as a result of the new and planned discount units. 11. The trend to revamp the bargain basement, mentioned earlier,



is still in its infancy. It is an important trend and rates separate mention. This trend will, without question, grow into adulthood quickly. Resources that have sold "downstairs" for years are facing substantial changes. Concurrent with this trend, department stores are trying to put "bargain basements" of the new type into branches where the basement has been overlooked. Few new branches of department stores will be without a modern type of basement. (At least one department store branch, minus a basement, put a "basement" department on one of its upstairs floors!) There is some talk to the effect that department stores will plan whole floors for discount retailing—and whole floors for prestige retailing. This is not idle gossip. In one of the great Hecht stores, for example, the basement has gone check-out while the high fashion departments upstairs are more luxurious than ever. 12. There is a trend among department stores to comprehend that this business of "image" is not as simple or as crystal clear as had been fondly imagined. When they see Korvette opening magnificent new stores, and when they see the new Korvette store on Fifth Ave nue, they begin to realize that a store image can and perhaps should be many things to many people. This trend will open up department stores for many resources. 13. Department stores are putting in Rx drug operations quite fast. One out of every three Rx departments in department stores was opened in recent years. Department stores may be infants now in the prescription business, but they will grow rapidly in this depart ment. 14. Private brand exploitation by department stores is by no means new. But it remained an infant trend for many years. Currently, with a shopper climate more favorable for private brands, there is reason to believe that the traditional department stores will press still harder to push their private brand volume and to extend it to still more classifications of merchandise. Private brand exploitation promptly leaves an impact on manufacturers' marketing programs. 15. There is an infant trend—and this is really an infant trend— among traditional department stores toward working with dollar figures, instead of percentage figures, in determining the profitabil ity of various lines. This, of course, is the operating bible of the dis count chains. Whether this trend will blossom among department



stores is a question mark at this moment; this outlet has percentage markup bred in its bones. But, if nothing else, some department stores are displaying more willingness to pay attention to dollar figures. This may be a cue for some resources to emphasize this factor in their conversations with department store people. 16. Some interesting changes are taking place with respect to the functions of department store buyers—this trend is almost a lusty infant right now. A typical example of the new concept is found at The Hecht Co. The plan was set up four and one-half years ago to give buyers more time to spend on the selling floor of each unit. At the time, the company had two large suburban stores, in addition to the main downtown store, and was preparing to open a third and fourth suburban unit. Executives previously had felt it was essential for buyers to spend time on the selling floor in all units, but realized that their time became more scarce with each new store. As a result, a program had been set up whereby each store, including the main downtown store, was organized as a single unit, rather than a parent store with several branches, and managers were put in charge of the departments, freeing the buyers from direct floor supervision. But then it was concluded that, with more stores, buyers could not spend time on the selling floor of each unit when they were burdened with responsibilities of buying as well as floor supervision in the main store. It was realized that it was unlikely that buyers could continue this arrangement and still have time to devote to suburban units. It was decided, therefore, to organize the downtown store parallel to the setup in suburban stores that had an internal organization. Each suburban unit had its own managers who worked without a great deal of help from the buyers. By treating each store as a single unit, with individual department managers, buyers were freed from immediate floor supervision and trivial matters such as lunch hours, days off, and so forth. Under this arrangement, the buyer devotes all attention to merchandising —buying, sales training, department layout, and display, for example. The buyer is not divorced from the selling floor. On the contrary, this system allows more time on the floor, talking to customers as



well as sales personnel. It allows the buyer to be more of an expert on layout, display, training, and so forth, and to devote time to all units. It frees the buyer from direct supervision of the main store department. In brief, the day when a buyer will be called upon to act as departmental manager is waning. Buyers will have nothing to do with the operation and management of departments, and will act as buyers only. At B. Gertz, Inc., the functions of the buyer are also being changed. As a Gertz executive put it: "We were running 10% ahead in business, 60% in buyer meetings, and 90% ahead in buyer paperwork. Now, perhaps, a good proportion of this can be changed. We are re-examining the role of the buyer as both purchaser and seller at a time of branch proliferation." Apparently, Gertz plans to divorce buyers completely from all supervision of sales activities and responsibilities for merchandise presentation. Individual suburban units of the Gertz group of stores would no longer have branch status, with the Jamaica store as the main outlet, but each would be an equal part of a chain. The buyer would then work out of a central office while sales, floor, and allied duties would be transferred to department managers in each of these units. Changes of this scope in the functions of the department store buyer must inevitably reshape the selling programs of many resources. 17. A leading discounter predicts that numerous price-promotional department stores, notably the third and fourth largest ones in a city, will give up their downtown locations within the next five years and convert to suburban discount operations. The move, startling as it may seem, will be one of necessity, he contends, since many of these department stores are selling basically the same type and quality of merchandise as the discounter—but at higher prices. Some of the major changes he envisions for the department store in its new discount role are: It will take advantage of declining markets faster, consistently undersell, and always be in a fluid and flexible open-to-buy position. Ceiling on rental will be 3 per cent of sales, as against the conventional store's 6 to 7% per cent.



Personnel, who normally account for about 13 per cent of the average store's volume, will operate on 8 per cent. Fixture costs in the new discount operation will run about a half or a third less than in conventional stores. Usual store services, such as charge accounts and deliveries, as well as aesthetic services (gift wrapping, ribbon, fancy boxes, etc.) will be dropped. Morris Natelson, partner, Lehman Bros., has predicted that: "In not too many years, probably all popular-priced high-volume stores operating in multi-storied buildings will operate, under penalty of elimination, as self-service, limited store service operations." The trend toward closing downtown department store units is extremely spotty. In several cities, not one but two department stores have closed their downtown units. In other cities, department stores have enlarged and improved their downtown units. But there is a faintly evident trend among the number three, four, and five ranking downtown stores to pull away from the downtown area—and this trend will undoubtedly pick up. 18. Stewart & Co. opened in the Baltimore area what was heralded as the first suburban department store branch integrated with an adjacent warehouse equipped for automatic stock movement. This not only greatly reduced the nonselling area of the store, but it made available instant stock replacement facilities. One of the grave prob lems of so many department store branches is their constant need to tell the shopper, "We'll have to get that from our downtown store." No other retail store is so regularly out-of-stock as the typical department store branch. This combination of store and adjacent warehouse might, therefore, become something of a trend and, if it does, it will have considerable significance for manufacturers. 19. Several department stores have discovered—with the help of AT&T—that it is possible to sell more than staples over the tele phone. Some progress has been made by Block's, for example, in selling washer-dryer combinations, refrigerators, TV sets, and stereos by telephone. This infant trend among department stores toward selling big-ticket merchandise over the telephone could grow rapidly. (After all, Sears will sell an enormous total of everything under the sun by telephone.) 20. Several department stores are testing new in-home selling pro-



grams. Some of these stores are using an organization specializing in this form of retailing. But Lit Bros., in Philadelphia, is trying this plan out in its own way, and on its own. Lit Bros, has launched a shop-at-home plan which is expected to blanket the Philadelphia trading area with local housewives who will present merchandising demonstrations in their respective neighborhoods. 21. Raymond Loewy-William Snaith, Inc., have evolved an in teresting concept for the department store of the future. It's been called a "hybrid" department store. It tries to preserve the image of the department store while offering both fashion and convenience merchandise in associated but distinct store areas. The plan combines three separate hexagonal buildings joined at a central core. One building houses the fashion store; one, the home store; the third, the convenience-price store (the discount section). A normal department store branch offers only an upstairs and basement store. The "hybrid" would be able to absorb the entire classifications which such stores are not now able to carry successfully. In the "hybrid," the basement becomes a full budget-convenience store, separated in its unit identity, using self-service techniques, etc. Snaith suggests the possibility of adding a food market, and this advice will be acted upon. This is a highly interesting concept. If it becomes a trend (at the moment, this is not even an infant trend, but merely an idea) it could hold considerable significance to many manufacturers. 22. The great department store chains are still infants despite their huge size. (Allied Stores rolled up a $712 million total for 1961, but it is shooting for $1 billion by 1967 "or sooner.") Their rate of growth will zoom over the next few years. A $2 billion department store chain, by 1970, may very well be in the cards. Also, mergers between department stores will accelerate. The merger between Gimbel's and Schuster's in Milwaukee is what we are referring to here. One reason is that between 1945 and 1950, the smaller department stores (up to $10 million volume) were the most profitable; today, this role has passed to the $50 millionand-up stores. 23. The Hecht Co., Washington, D.C., has introduced an extensive rental service in its Silver Spring, Maryland, store. A wide variety of items is available for rental by day, week, or month. The store offers



delivery and pick up at no extra charge and the use of charge accounts for payment of rentals. According to Harry N. Hirschberg, Vice President and General Manager, the operation will compete with all types of independent rental operations. The Hecht Co. rental service includes: Party needs: linens, china, glass- and silverware, serving pieces, tea and coffee services, bars, trays, folding chairs, tables. Do-it-yourself tools: electric hammers, jig saws, sanders, paint sprayers, floor polishers, carpet cleaners, power saws. Hospital equipment: electric hospital beds, wheel chairs, crutches, over-beds, commodes, trapezes, motorized bikes, massage lounges. Baby and guest needs: rollaway beds, auto cribs, play pens, high chairs, strollers, youth beds, plus TV's, typewriters, stereos, P.A. systems, and many more too numerous to list. There is little doubt that this infant trend will grow—the traditional department store will become a major factor in rentals. 24. Finally, the electronic data processor (EDP)—still in its infant stages in the traditional department store field—is destined for rapid growth. It has been undergoing elaborate tests; it has had its ups and downs, but it now seems poised for rapid acceptance and use. Certainly the department store cannot hope to bring its constantly spiraling costs under control unless and until EDP takes over. This is one reason why, in late May, 1962, a whole session of the National Controllers' Congress Conference in New Orleans was given over to a discussion of the problems attendant upon the introduction and use of electronic data processing. It is just barely possible that the major department stores may even lead the way among mass retailers toward acceptance and smart use of EDP. If so, this would not only be historic, but it would also hold out promise that the granddaddy of mass retailing may be destined for a renaissance.
Food for Thought in Food Super Infant Trends

1. The retail grocery industry is apparently destined to be run almost entirely from the central headquarters of independent chains and corporate chains. No more than one hundred headquarters will control the buying and merchandising of the food products in the American consumer's shopping cart.



The battle line is clearly drawn—on one side is the corporate chain; on the other side is the independent chain in its various forms. This trend is in its infancy in the services rendered for member stores by the voluntary chains, the co-ops, etc. These independents are destined to give up most of their independence to their central offices—and this will have a profound impact on the marketing programs of the food processor. 2. Retailing is no longer solely merchandising—it is now also en gineering. Food retailing, going back to the warehouse, is still too dependent on manual labor. The independent groups particularly lag in this respect. The push-button control panel must take the place of a strong back in every part of the food handling process. This is very much of an infant trend—and scheduled to grow rapidly to maturity. And this infant trend, with its reaction on inventory policies, out-ofstocks, etc., will be felt in the offices of most food processors. 3. In one group of independent food stores, it was reported that in 1953, the small stores in the membership made up about 46 per cent of the total membership and accounted for 11.3 per cent of total purchases. Today, small stores account for only 22 per cent of the membership and 2.7 per cent of the purchases. A review of the policies and programs of food wholesalers premised on new size relationships of accounts is now an infant trend. 4. Retail mergers are bringing together retail organizations of different types. We will wind up with some giant retail organizations that will include, under one corporate roof, almost every type of chain and department store. Under this kind of development, will the food wholesaler confine himself to the food outlet? Will he begin to think of matching competition's diversification of outlet types by a similar type of retail account diversification? This is not mere speculation. It is beginning to happen. It could become important to many nonfood manufacturers. 5. Today, perhaps 50 per cent of our total retail volume in almost all lines is done after 4:30 P.M. (Sears Roebuck accounts for approxi mately one-third of its total retail store volume after 4:30 P.M.) Today, 70 per cent of our total retail volume is done in 15 to 18 store hours of the week.



These are no longer infant trends, but the programs planned by manufacturers in food to benefit from these trends are still in their infancy. What are the manufacturers doing to help their retailers adequately to cope with this costly tendency for retail volume to be done in fewer and fewer hours of the week while store hours increase? The peak-hour problem in retailing will worsen. People make fewer shopping trips weekly. Walk-outs due to crowded aisles and the time factor are enormous during peak hours. So are half-waXk-outs, etc. Here is where retailers lose more volume than they lose to competition. Manufacturers must develop programs designed for the food outlet (and other outlets, too) to sell more during peak hours. This will be less costly than trying to get customers to shop when they don't want to shop. 6. The food wholesaler is finding increasing reason to help his customers with their financing problems. One of our voluntary groups developed a subsidiary capitalized as a $2 million corporation which, in its first year, made 30 loans ranging from $1,000 to $85,000 for store improvement, inventory, equipment, and building pur poses. As it grows, it is expected it will be able to make loans up to $250,000 for each applicant. Another voluntary group will sign the lease for a member store and sublease the structure to the member for an additional 10 per cent. The management of this group asserts its members would not have a chance in competing for sites against the corporate chains if it did not help its members in this way. Another group helps its members finance their equipment Will food processors develop credit corporations to help wholesalers to help the food outlet? This could become a trend. 7. The back room of the food outlet is one of the cost trouble makers. Savings at the warehouse bung may be wasted at the back room spigot. Here is an area for study by wholesalers, retailers, and manufacturers. 8. Many food outlets are fully aware that their costs are too high —and that new forms of competition make it imperative to bring costs down. The food super started in the 1930s with a margin re quirement on food of about 10 per cent. Today, that margin is about



21 per cent. That's a 100 per cent jump. It continues to inch up. This is the food outlet's Achilles' heel. The trend to bring costs down is definitely in its infancy. Here is a fertile field for imaginative programming by manufacturers. 9. Nearly six out of every ten new food supers are doing less business than planned. This is worrisome—as it should be. The prin cipal reason is competition. The typical food super that opened in 1961 was confronted with direct competition from three to five other food outlets. Between the decision to open a store and the store opening, competition sometimes doubles. New trends are developing with respect to the actual store opening. Less hoopla. Somewhat more scientific programming for the opening event. Few manufac turers are alert to this trend—even fewer are doing anything about it. 10. Sales per square foot in new food supers declined in each of the last three years—from $2.91 in 1959 to $2.61 in 1961. That's a decline of roughly 10 per cent while costs in new stores mounted. This is an infant trend that the food super is understandably eager to keep in an infant stage. What cues here for manufacturers? The food shopper is beginning to show a few signs of rebelling at high margins for food under self-service. Discount food outlets, with their lower margins, may cause this public attitude to snowball. This, too, is an infant trend right now—but it has grave implications. 11. The number of families available to each new food super is dwindling rapidly. This is a bad situation. As a consequence, it now takes from two to three years for many new food stores to turn the profit corner. Since new competition obsoletes stores and store loca tions at a fantastic pace, this disturbs the current thinking of the food outlet. Whatever disturbs a retail outlet offers idea opportuni ties to manufacturers supplying that outlet. 12. Shopper loyalty is at an all-time low. Few food supers get even the major share of the food purchases of the majority of their customers. Bigger stores and less loyal shoppers spell out a big prob lem. The average ticket is rarely satisfactory. This was the reason for the initial interest in the ill-fated Philco Instant Dividend Plan. This trend is past the infancy stage, but it becomes more serious each year. What manufacturer will come up with a great program to rebuild shopper loyalty for selected food outlets? 13. Nonfood outlets are becoming important distributors of food. But this trend is definitely in its infancy. Discount chains, drug



chains, variety chains, some department stores, other chains—are all adding food. The fastest growing outlet for food today is the nonfood outlet. And some of the new outlets inventorying food are not concerned about earning a profit on food. In some instances, other departments subsidize the food department. One out of four members of the Super Market Institute reports severe competition on food from nonfood outlets. Discount houses alone will sell over $2 billion in food in 1962. Are food processors adequately cultivating the new outlets involved in this infant trend? 14. The shopper tends to cover too small a part of the total area of the large new food super units. This cuts down the average ticket. This is a trend of rapidly growing proportions. It spells opportunity for some manufacturers. 15. Five years ago, a well-managed food chain showed a return on invested capital of about 20 per cent after taxes. Perhaps no other mass retailer could boast of such figures five years ago. That attracted capital. But return on capital has dropped to a 9 to 15 per cent range. And, in 1961, it did not begin to compare with the capital investment return of the successful discount chains. At least some food chains are just now finding that financial institutions are somewhat less eager to make investments in food supers. This is a very real problem although still a small one. 16. The trading stamp has achieved almost a stalemate. It is now primarily a cost factor. The eagerness of some 300 food chains to try the clearly doomed Philco Instant Dividend Plan was evidence of the stamp doldrums. Other ideas that will get the shopper to buy a larger percentage of her week's requirements in one store are seri ously needed. 17. There is a tendency for some food chains (and not merely the small chains) to make increasing use of the food wholesaler. This infant trend bears watching. 18. There has been a change of attitude among food store execu tives that is interesting. Bear in mind that the food super for several decades was the darling of retailing. It seemingly could do no wrong. This inevitably led to smugness, to complacency, to a tend ency to follow traditional thinking. But a half year ago, at a meeting of food super operators, the convention theme was: "Where Do We Go from Here?" and a food trade paper editor remarked about that meeting: "Never in the experience of this observer have food store operators talked more freely, expressed so many different views, or



shoum so much receptivity to new ideas." (This is, indeed, a new trend of thinking; it means a good deal to manufacturers.) At that meeting, there were advocates of three basic programs: A. Continue to build new units of the traditional pattern, concen trating on foods and a small nonfood section in 10,000- to 20,000square-foot stores. B. Build new stores about twice the present size, and divide space equally between food and nonfoods. C. Build giant general stores of 100,000 square feet and over with heavy emphasis on general merchandise—presumably true discount outlets. The present trend seems to be leaning toward plan C. However, some food supers are planning to open a variety of types of food stores. These would range from bantam units to giant discount units; from luxury stores offering deliveries to warehouse-type stores; from neighborhood locations and even downtown locations to great regional shopping centers. This diversified concept of store type and store location may well become a wave of the future. Several food stores are even testing the membership or closed-door concept applied to a food outlet. These are all infant trends. 19. Food supers are, of course, opening leased departments in discount chains. This trend is still in its early stages. Figures are not yet available on performance. These leased departments tend to offer a more limited inventory, fewer services—and also lower prices. They do not attempt to cater to the fussy shopper. 20. The food super is starting to buy into discount chains. Where this is done, the trend is for the food super to put its food into the acquired discount outlets—and to put the inventory and other tech niques of the discount outlet into operation in the nonfood sections of its food outlets. (Of course, discount chains are also buying up food outlets.) In several areas, syndicates have been formed bring ing under one corporate roof a food chain, a discount chain, and several other types of chains. One such syndicate includes a food chain, a shoe chain, a shirt chain, a chain of men's and boys' wear discounters, and a chain of women's and children's apparel. They are opening huge 200,000square-foot general merchandise chains, etc. Several food chains that acquired drug outlets, discount department store outlets, fashion outlets, and even auto tire and accessory outlets are opening new



stores in which all of these subsidiaries are brought together under one roof. The food chains are also quite busy right now buying up drug outlets. These are infant trends of major future importance to suppliers. 21. A few experimental food stores of new types are being tested cautiously. These tend to be low-margin concepts. An example is a warehouse-type unit with merchandise spotted on pallets. The goods are put on the selling floor in case lots and sold directly from the pallets. A few food stores have been opened that are not ban tams—but which cut assortments sharply, cut all services, operate at low cost; they may run from 5,000 to 8,000 square feet. New locations are also being the subject of experiment. The commuter railroad terminal would be one example. Locations in giant apartment house developments would be another. One food chain is apparently impressed with the fact that a uniquely successful soft-goods chain, called John's Bargain Stores, locates only in distress areas. This food chain is testing this idea. One food chain is testing leased food sections in a variety of outlets rather than exclusively in the discount outlet. This includes a variety chain outlet, a drug chain outlet. New outlets are moving into food; some food supers have concluded that maybe it's a good idea to join up with the enemy. These are all infant trends;—but each could profoundly affect the marketing plans of many manufacturers of nonfoods as well as of food. 22. There is a small trend toward new service departments. These include in-store snack bars, shoe repair, beauty shop, dry cleaning, automatic laundry—even insurance and banking. In the food outlet, some of these service departments are leased—and some operate in adjacent buildings. Auto tires, batteries, parts, and accessories are being added quite rapidly by food outlets. So is limited car servicing. Gas and oil also promise to become important in the food outlet. This will tend to be private-brand gasoline. It will interest you to know that privatebrand gas sales now enjoy 30 per cent of total volume in some areas. The auto made the food super—but the food super is only now beginning to cater to the car itself. 23. There is general recognition that larger stores and bunched stores must draw traffic from greater distances. Promotional areas are, therefore, being extended.



24. The food outlet is turning increasingly to private-brand ex ploitation in both food and nonfood. This is not an infant trend— except in certain merchandise classifications. But it is so important that it demands inclusion in this summary of infant trends. 25. Automation in the warehouse, electronic data processing, faster communications—these are just now moving ahead rapidly in the giant food chains. The food outlet that is not technologically competitive will hardly be able to be merchandisingly competitive. This trend will be of major importance to suppliers. 26. The engineer is finally being called in to study the physical aspects of food distribution. Costs here are too high. Several giant food processors—General Foods, General Mills are examples—are working on this problem. There will be important developments here before long, including perhaps more direct shipments from manu facturer to retail store. This program will include palletization, standardization of container sizes, expendable pallets, etc. Quite a revolution is brewing here. 27. Electronic self-service may develop into an infant trend first in the food outlet. Its prototype, however, is in operation in a hard ware outlet. Customers in Throckmorton's hardware store in Day ton, Ohio, pick up IBM cards next to items they want and take the cards to a cashier who puts them through an IBM machine. This prints an invoice in triplicate. One copy is sped through a pneumatic tube to the stockroom where employees on roller skates fill orders and deliver purchases to pickup windows. The store claims the system halves labor costs, cuts shoplifting. In Toronto, Canadian Tire claims its IBM-run store fills the average order in two minutes. The era in which purchases are brought to a check-out is waning. There simply is no reason why the shopper must lug purchases to a check-out. In the food super the check-out is a king-sized headache for the store and for its customers. This will be a great revolution that will profoundly affect the marketing of all suppliers. 28. There has been an enormous jump in eating out The food outlet is just beginning to turn to some of the remarkable new auto mated techniques for serving quick meals. These automatic eating places, which are miniatures of automated factory dining rooms to which millions of workers have become conditioned, are in a stage of dynamic growth. 29. The food outlet may pioneer automatic vending. To date, the food super has given little real thought to automatic vending. More



automatic vendors belong in the food outlet right now, inside the store, outside the store, and in its parking lot. Maybe food supers will install and service automatic food and other vendors in other locations such as in gas stations, in big apartment houses, etc. This is a true infant trend with almost awesome implications for food processors—several of whom, right now, have special departments for automatic vending programs. 30. A store that delivers piping hot food to the home, ready-forthe-table, has had interesting success in New York. This idea has interesting potential. There are other ideas such as this that could open new concepts of food retailing appealing to millions of noncooking wives. 31. The food outlet is just beginning to consider inviting in the leased department operator on some of its newer nonfoods, especially soft goods. These syndicates of leased department operators are growing rapidly. 32. Gourmet foods, national foods, exotic foods are showing good gains. Larger sections and specialty shops are in order. This prom ises to become a big trend. 33. Some food super chains are beginning to make detailed studies of manufacturers' deals. These studies will unquestionably lead to conclusions on the part of the food outlet that, in turn, will compel manufacturers to do a better job of planning deals for store profit as well as for turnover. This is one infant trend that could grow to ma turity quite rapidly—deals seem destined for quite an overhaul in the not-too-distant future. 34. The food super is broadening its soft-goods and fashion classi fications. A Canadian food super installed an "in-store shop" in a new unit that provided 700 square feet for ready-to-wear. The food outlet is, of course, far behind the variety chains with respect to soft-goods and fashion lines. It probably will never catch up with the variety chains. But either through special sections in food stores, or by buying into discount chains strong on soft goods, home furnishings, etc., the major food outlets promise to take their infant soft-goods and fashion departments and rear them to adulthood rapidly. 35. Reference has already been made to the forays of the food supers into discount outlets. A bit more data on this trend is in order. Present plans take three forms: (1) To open food depart ments in discount houses as lessees. (2) To open its own discount



stores and possibly lease out certain departments. (3) To buy out or merge with existing discount operators. Thus, Penn Fruit acquired Kiddie City, a nonfood low-margin operation. Penn Fruit will open family stores to be called Super Kiddie Cities that will be linked to complete Penn Fruit markets. A&P is opening so-called Family Savings Centers—these are presumed to be discount stores. Food Fair is heavily involved in discount outlets that it has acquired, including Enterprise-J. M. Fields, Inc., a Boston based chain of over 45 discount department stores. (Fields expects a $200 million volume by 1963.) Meijer Super Markets of Grand Rapids has opened a discount chain called Thrifty Acres. Stop & Shop acquired the Bradlee discount stores and has made other moves in this direction. Jewel Tea acquired the discount department stores of the Turnstyle Corp. Jewel announced that this move was "in keeping with our program for developing family centers, which will be self-service food supermarkets, plus department and variety and rug store combinations." Safeway's Los Angeles Division has been experimenting with discount departments in a few of its stores. In one store, over 30 per cent of the selling area was turned over to the discount departments. (And to make room for these new discount departments, the food sections were compressed! That will probably send a chill, down the spines of some food processors.) 36. The food super is turning toward the promotion of rentals. With its huge daily traffic, the food super may come out near the top in this fantastically growing area of rentals for a broad variety of merchandise classifications. 37. The bantam food store—varying in size from 1,200 to 2,800 square feet—moves along, but is still an infant trend. There may be 2,000 of these stores in operation right now. It is dubious, in our opinion, that the bantam food outlet will ever become a major factor in food distribution—except in a few areas where special circumstances exist. 38. In a few luxury stores—such as a food store in Manhattan's silk-stocking district—credit is being offered on food (also orders are taken on the phone and delivered). Simultaneously, the food supers are finding it necessary to offer credit as they move into non food big-ticket merchandise classifications; this is fairly common procedure today. It seems almost inevitable that a store that offers credit on a substantial part of its total inventory must, someday,



extend credit privileges to the remainder of the store; in this instance, extend credit to food. We expect to see this happen, but as of this moment it isn't even an infant trend. (Incidentally, Giant Food has launched what it calls a "discount" credit plan—discount at a discount. This doesn't apply to food—yet.) And that charts most of the infant trends in the food outlet. However, between the time of writing and the time of publication other infant trends will be spawned by the food outlet. The food outlet is striving fiercely to recapture its early net-profit ratio and its early return on invested capital. This attitude breeds experiments—and experiments sometimes develop into infant trends that eventually grow to adulthood.
The High Infant-trend Birth Rate of the Variety Chains

For the better part of the last decade, the variety chains—on balance—have been turning in regularly drooping net-profit ratios and capital investment returns. During that same decade, this mass outlet completed its rapid march away from its original five-and-dime concept; the newer stores of the variety chains show no recognizable similarity in inventory to the inventory formulas of the founding fathers. Today, the variety chains—particularly in their large newer store units, in which they will soon be accounting for the major part of their annual turnover—carry an inventory that made a mockery of the former name of their association, Limited Price Variety Stores Association. "Limited price" is hardly the inventory policy of the spanking new giant stores of practically all the members of the present Variety Stores Association. In fact, at least one former member of that association—the G. C. Murphy Company—withdrew because it had concluded (quite properly) that it was now operating a department store chain. The huge new stores of the variety chains carry a considerably more varied inventory than is true of most giant food super stores and of practically all drug chains, and of many discount stores. What is more, there are at least several hundred so-called "traditional department stores," many in downtown locations, that cannot boast of as many different departments as do the new variety chain units, and that cannot even compete with the variety chains in some softgoods classifications. Yet it is clear that even this firmly established trend of the variety



chains toward a somewhat new type of department stores is still in its infancy, especially in some merchandise classifications. For example, the variety chains are still merchandising babes in major appliances. They are still merchandising babes in higher fashion ready-to-wear. When you hear about a variety chain (Newberry's) selling an electronic organ for $1,625, or a mink garment for about $1,000, these are still isolated occurrences. However, the variety chains are determined to push ahead still more vigorously toward higher price lines in many merchandise classifications, toward still larger inventories of big-ticket classifications ranging from major appliances, TV, and stereo to furniture, rugs, boats, and higher fashion lines. There is little question that, within three to five years, the newest variety chain store units will be more truly representative of the modern department store concept of that coming period than will hundreds of old-line department stores (so many of which will continue to be primarily dry-goods outlets). In addition to this fundamental trend among the variety chains— a trend that, in some respects, is in adult stages and, in other respects, is an infant trend (depending largely on merchandise category), there are many other infant trends now discernible in this outlet. They include: 1. The highly interesting test by McCrory of its "shopmobile." This is a perambulating store—a store on wheels—a mobile store that brings its inventory right to the shopper. This is a modern version of the wagon of the Yankee tin peddler. Its inventory consists of many small staple items. It also includes a type of mail-order counter desk. In other words, a catalog desk makes it possible for the customer to order from a much larger inventory than is available in the truck. (In England, the Woolworth chain has had a mobile retail operation somewhat of this type in operation for the past several years.) One of its appeals here in the States presumably is to the housewife in a one-car family who is left stranded when hubby takes the family car to work. Several food chains have operated a version of this concept on a large scale for some years. Whether McCrory ever gets it off the ground remains to be seen. But it is, nonetheless, a highly interesting experiment that could develop into an infant trend and then, perhaps, into a more adult trend. Certainly shopping from the home in various forms is on the increase; this mobile store



is in line with that trend since it permits shopping from the doorstep of the home. 2. The variety chains are beginning to show an interest in the merchandising of services. Thus, W. T. Grant has gone into the domestic travel business. At the time of writing, Grant was selling domestic tours in some 35 of its Eastern stores. These tours ranged in cost from $79 to $295. (Both Sears and Ward have gone into the travel business in the last year.) McCrory has opened coin-operated laundries. Several variety chains operate auto service stations, and others will soon follow suit. There is little question that the variety chains will broaden the scope of their service departments. Few variety chains have had even the traditional service departments—optical, beauty shop, etc. This is now destined to change. 3. The variety chains are beginning to open specialty store units of various types. This started when the variety chains became in terested in nursery products and garden equipment; Woolworth started a number of free-standing units of this kind. Now J. J. Newberry is experimenting with a higher-priced women's specialty shop (to be operated under the name of R. H. Taylor). The first one is in a St. Louis shopping center, where Newberry's has one of its large stores. It will be a 13,000-square-foot two-story store concen trating on better fashions—what the traditional department stores would call a "twig." Newberry plans to build this concept into a fullfledged chain if results are satisfactory. Newberry is also planning what may be described as a "seasonal" store. This starts out, in season, as a garden store. In other seasons it will feature toys, home furnishings of specialty types, etc. Newberry is experimenting with restaurants and with a package liquor store. (Also, Newberry is opening a chain of department stores under the name of Britt.) There is some reason to believe that all mass retailers will soon be testing new versions of specialty stores. After all, there must be a saturation point in giant one-stop outlets. The variety chains seem to be moving rather vigorously with experiments in this direction. 4. The gourmet food section is being rapidly developed by some of the variety chains. This comes on top of a rapidly expanding food section. In one of its outlets, Newberry is featuring gourmet food items selling as high as $50. A new Woolworth store devotes 90 feet of counter to a self-contained gourmet food center. Among the items



displayed are smoked oysters, rattlesnake meat, and, of course, caviar, some of the newer food status symbols. 5. The variety chains are moving perhaps more rapidly than tra ditional department stores toward what is called "cross-merchandis ing." This is simply the well-known merchandising principle of mul tiple locations for an item, brand, or line. Thus, a few watches may be shown along with cosmetics, $10 flasks appear in men's wear sections, and, in fashion merchandise, wall and rack manikins feature "ensemble selling tags." 6. The private brand is still an infant trend among the variety chains. But it has reached a point of development where Grant feels justified in testing an outside selling force of a dozen men for its private brand lines of major appliances. Along with all other giant retailers, the variety chains will feature their own brands in more de partments—and more energetically. This will be especially true of the variety chains because they feel discount competition and the private brand, presumably, is one road of escape from comparative price shopping by the customer. (Incidentally, this use of an inhome selling force might very well develop into a major trend in this outlet, especially as the variety chain goes into more big-ticket merchandise and particularly into home furnishings—including rugs.) 7. The variety chains have a serious problem stemming from the fact that so many of their older stores are even older than their years —merchandisingly speaking. In these old stores inventories are in adequate; the necessary new merchandise classifications cannot find room, etc. As one solution to this problem, Kress arranged in one of its older stores to take orders from floor samples—on dinette sets, for example. Delivery to the customer is made by the "mother" store; in this instance, the giant Kress unit on Fifth Avenue in New York. This seems to be a logical procedure. Shoppers have become conditioned to expect a delay in delivery in certain merchandise classifications. This could develop into quite a sizable trend and might open up older outlets to manufacturers whose line just could not be squeezed into these smaller stores. 8. Borrowing an idea from the discount chains (the variety chains are borrowing many ideas from discount chains) some variety store units are beginning to display bulky merchandise in original ship ping cartons—vanity stools would be one example. Store managers



are very much interested in this idea—it encourages impulse purchases, opens up stock room space, lowers the cost to sell. If this infant trend catches on—and it probably will—manufacturers will be wise to plan their shipping cases for better on-floor selling and for easier take-home. 9. The variety chains are having second thoughts about the check out. Check-out procedures in the food outlet are aggravatingly slow, but in the variety chain they can be, and usually are, very much slower due to the varied nature of the merchandise. Woolworth, McCrory, and Kress, all of whom have check-out stores, are experi menting with a cash-wrap desk operation. Manufacturers who have been fighting for choice check-out space may now have to plan strategy for space at the more numerous cash-wrap desks. 10. The variety chain clearly plans to become a factor in tires, bat teries, auto accessories—even in servicing the car with gas and oil, and including actual maintenance. This is being done usually through a leased department. 11. And that brings us to the leased department trend. For years, variety chains vowed they would never, but never, bring in leased departments. Now the variety chains are beginning to lease de partments in their regular stores and, of course, even Woolworth is leasing departments (and major departments at that) in its Woolco discount stores. This will bring some manufacturers of many merchandise categories into the variety chains via the leased de partment operator. 12. Variety chains are now beginning to conduct tests with regard to presumed barriers in price lining—rather than accepting the premise that "every bit of tradition proves that we can't sell suchand-such a price line." This should be highly encouraging to many suppliers who have been thrown for a loss by this very argument. For example, in luggage the $10 pricing point was considered an uncrossable barrier by the variety chain. At the time of writing, however, that barrier was beginning to crumble; several variety chains are now moving luggage in the $20 price range and even higher. This will become increasingly true of more and more merchandise classifications. The variety chain is trading up faster and more broadly than any other mass outlet. 13. Some of the variety chains are following a new-store program that involves clustering a group of stores in a tight area. The advan-



tages are presumed to be: (1) A lower cost for advertising since the budget is shared by a group of stores. (2) The cluster may make that particular chain the strongest outlet in the trading area. (3) By drop-shipping fast-moving numbers to a centrally located store in the group, faster distribution is obtained; out-of-stock on hot numbers is not quite so chronic. (4) The smaller stores in the cluster can promote big-ticket numbers that they cannot back with advertising by taking advantage of the advertising run by the big stores in the cluster. 14. The variety chains are moving more deeply into drugs and even into prescriptions. This is especially true in some of the new discount units of the variety chains—pharmacies will probably be included in most of the Woolco stores. Kresge drug departments, now operating in several stores, do not include prescriptions, but presumably this could come later. There is little doubt that the variety chains will build a substantial volume in proprietaries, sun dries, etc. 15. Diamonds might become the variety chain's best friend. Jew elry departments featuring diamonds and 14-karat gold jewelry are sprouting up in this outlet. 16. McCrory's may be pointing the way to the other variety chains in the direction of broad-scale diversification. McCrory's is planning so-called McCrory Villages. These will be fully integrated retail stores operating under one roof and all owned by McCrory. This is an adaptation of the Korvette City idea. This variety chain now owns a tire chain, a men's furnishing chain, a men's shirt chain, a women's dress chain—and the end is not in sight. This could develop into a trend of considerable importance to many manufacturers. 17. Variety chains are giving their store managers increasing lati tude, especially with respect to pricing. Daily price lists are still sent out, but most managers are given to understand that they are expected to meet competition on price. 18. The variety chain, like the department store, is also trying to think in terms of dollar volume and velocity of turnover rather than in traditional terms of markup percentages. However, tradition dies hard among the variety chains, and only the slightest progress has been made in this particular direction. But there is at least a fair chance that markup worship may lessen—in which event, a number



of manufacturers supplying the variety chains would probably heave a big sigh of relief. 19. The variety chains are trying desperately to increase the average sale per lineal foot. Newberry reports that, in 1961, its lineal foot figure was $459 as compared with $224 in stores that were opened in 1957 and 1958. This will become a critical measuring rod in variety chain operations; manufacturers would do well to be better informed on the lineal foot performance of their lines. 20. The extension of credit by die variety chains is no longer an infant trend. But the variety chains have a long, long way to go be fore their credit operation compares on a percentage basis with that of Sears. So, to this extent, it is still an infant trend. All mass retailing —including the discount house and the food super—will bear down harder and harder on credit. 21. There is a difference of experience and conclusion among the variety chains with respect to the use of trading stamps. W. T. Grant claims it has done well with stamps. Newberry's, on the other hand, tried stamps and then discontinued them. In 1962, trading stamps had fixed a fantastic hold on the shopping public—no doubt about that at all. If this proves to be durable, then most of the variety chains may wind up promoting stamps. However, there may be good reason to believe that the trading stamp craze is about to peak out. That, at any rate, is our conclusion. If this turns out to be so, then the majority of variety chains will not do more than dunk a toe in trading stamp waters. 22. The trend toward giant store units among the variety chains is still in its early stages. The 30,000-square-foot store soon will be considered rather small. The 60,000- to 80,000-square-foot store unit will be more typical of the newest variety chain stores—and the 100,000-square-foot unit will become somewhat more common. This will both encourage and necessitate forays into still bigger ticket lines and still more big-ticket classifications. For example, while the variety chains are much more deeply involved in furniture than in the days when they featured TV chairs almost exclusively, they still are not doing much with upholstered furniture, foam rubber modern furniture, etc. But this lies right ahead—and manufacturers of such lines would be wise to study the inventory of the newest store units of the variety chains. These inventories are quite



different from the inventories of stores that are even merely three years old. 23. Experiments with discount stores operated under other names are common among the variety chains. In several instances, they are not experiments. The Woolco chain, for example, will have achieved a substantial turnover within two years. Grant is operating its discount stores under the name Diskay Discount Marts. Kresge calls its smaller discount stores Jupiter and its larger ones K-Mart. Kresge expects to have some 50 Jupiter stores in operation by the end of 1962. The K-Mart stores of Kresge tend to concentrate on sporting goods, furniture, building hardware, rugs, home furnish ings, piece goods, footwear, men's and boys' apparel, housewares, hosiery and fashion accessories, jewelry, apparel for infants and chil dren, apparel for teens, women's wear, candy, and stationery. How ever, some K-Marts have 39 departments including auto accessories —and some departments are leased. Kresge expects to have 37 K-Marts by 1963. Several of the variety chains are turning old and small stores into discount units. These are usually store units that have been operating in the red. However, the discount tail is hardly likely to wag the variety chain dog. The variety chains have yet to prove that they can operate a true discount store and earn a profit. This is currently an infant trend. It will undoubtedly grow. But whether it will ever figure really importantly in the variety chain is debatable. We happen to think it won't. As we mentioned earlier in this chapter, most of the variety chains have been turning in poor net-profit ratios and poor capital return figures year after year; it is hardly likely that discount operations will turn this trend around. (In 1961, and in the first half of 1962, most variety chains reported dropping netprofit ratios and capital return.) 24. The variety chains will wind up in a very few years with from 50 per cent to 75 per cent of their dollar volume done in a com paratively small percentage of their total number of stores. These, of course, will be their giant department store one-stop outlets. Manufacturers will find, in some merchandise classifications, that they will win more economical operation by not attempting to get into all of the stores of a variety chain—a limited distribution con fined to the new giant stores may be preferable.



25. The variety chains definitely intend to expand their total softgoods and fashion departments—and on a huge scale. Some of these chains expect to account for 30 per cent of their dollar volume in soft goods. The trend toward higher fashion is especially emphatic. Price ceilings are moving up. In a new Neisner variety store, wearables have been accounting for 40 per cent of the store's total volume. But this is happening in only a few of the newest variety chain stores, which is why this is, indeed, an infant trend as yet. And that about winds up the infant trends of the variety chain. It is probably attempting more new strategies and tactics than either the food chain or the drug chain—and for this very reason it will offer many opportunities, and problems of course, to many of its suppliers.
Drug Outlet Infant Trends Cause Distribution Colic

The drug outlet—chain and independent—is faced with more trends (major trends that still have a long way to go, as well as infant trends that will grow to adulthood) than any other retail outlet. Suppliers to the drug outlet have already made many marketing adjustments to conform with the well-established trends. Now the industry must develop new marketing programs designed to cope with the market situations that will become stubborn realities when the present infant trends of the drug outlet grow up through adolescent stages to full adulthood. 1. A major drug outlet trend that still has a long way to go is die trend among the drug chains (as well as among some of the more enterprising independent druggists) to open leased departments in other outlets. This trend started with drug-chain operated leased departments in discount stores. Now drug chains are opening leased departments in the established store units of department stores as well as in the new discount units of department stores. Ditto with respect to drug leased departments in old and new stores of the variety chains. Ditto with respect to drug leased departments in old and new stores of the food chains. In 1962, at least one large drug chain will be accounting for close to 50 per cent of its total volume through its leased departments! Other drug chains will, before long, find themselves in this same position. Naturally, this has a profound impact on the distribution programs of suppliers to the chain drug outlet



2. The drug outlet now faces the breakdown of its monopoly on general merchandise sales, as well as drug sales, on Sunday. This was something more than an infant trend in 1962—but it is still a tiny trend when viewed in the perspective of its future. Sunday re tailing is on the march. It may be delayed—but it cannot be stopped. The unique exclusive privilege enjoyed by the drug outlet of selling anything and everything on Sunday has been broken—and is now in process of disappearing. Many manufacturers will begin to find, as a consequence, that other types of outlets will become more im portant in Sunday volume than the drug chain. 3. The entry of most mass retailers into drug retailing will someday reach a point where it will be difficult to decide who is the drug retailer! Thus, Sears plans an ambitious program involving drug outlets. The food supers have been buying up drug chains as well as bringing in drug chains as leased department operators. Several thousand food outlets employ registered pharmacists. The variety chains are clearly moving into drugs. Even the Robert Hall apparel chain tested (unsuccessfully) a drug department. The discount chains clearly are determined to build a substantial drug volume. In one quarter of 1962, one out of every seven new pharmacies that opened up was in nondrug outlets. In terms of floor space, perhaps 30 per cent of total new drug floor space opened in those three months was opened in nondrug outlets. It is entirely possible—indeed it is probable—that, in the near future, nondrug outlets will be moving a larger dollar volume of some of the merchandise classifications formerly exclusive to the drug outlet than the drug outlet itself! This would be quite a marketing revolution for hundreds of manufacturers. And this is one reason why, in 1962, a few of the ethical drug houses began to add proprietary drugs to their production lines— and then began to extend their distribution to the food outlet and other nondrug outlets. That was a revolutionary move for these ethical drug firms—daring in the extreme. For decades, a supplier to the drug outlet trembled in fear of incurring the disfavor of this autocratic retailer. That fear is now in process of being dispelled— an infant trend of vast distribution potentials for suppliers. 4. The low-margin Rx era is still an infant trend. It began in 1958, when GEM, Korvette, and a few other large discount chains added prescriptions. It has been predicted that, by the end of 1962, the



drug chains will have a minimum of 1,600 discount house competitors, many of which will have Rx departments. In New York City, it is estimated that a minimum of 15 per cent of all prescription business will have been garnered by discount houses by the end of 1962. By 1965, that figure may jump up to 35 to 40 per cent of total Rx business. Distribution changes of that size inevitably compel marketing changes by manufacturers of comparable dimensions. 5. The drug chains are trying to become general merchandise dis count chains. Thus, the new Katz Drug store units—and these range up to 80,000 square feet, which is gigantic for a drug chain unit— are labeled "discount" stores. Walgreen has acquired a discount chain. Other drug chains are moving in this same direction. Whether this infant trend will ever grow to maturity could be debated. But even if it doesn't get too far, it will be big enough to figure in the marketing plans of a number of manufacturers. 6. The drug chains are testing small stores as well as giant-sized units. The former are limited-item stores occupying from 2,000 to 4,000 square feet. They aim at annual sales in the $500,000 area and aim also at an annual turnover of 12 to 15 times, which would be quite respectable. These small stores take off, in some measure, from die experiences the drug chains have had with leased departments in other outlets. These leased departments tend, really, to be limitedinventory drug stores that benefit from the enormous traffic flow of the discount store. The drug chains believe that a similar type of inventory in a free-standing store properly located may have poten tialities for growth. This could develop into a new-old type of drug chain—new, because it represents a move away from the trend toward giant store units; old, because it represents a throwback to a modernized version of the pioneer pineboard units opened by the drug chains. Typical of this trend are the Dot Discount Stores opened by the Cunningham Drug chain. This is planned as a five-state chain with some 35 Dot stores to be opened in a six-months period. The average markup in the Dot stores is to be 20 per cent, compared with perhaps 33 per cent in traditional drug outlets. 7. Along with this trend toward this type of midget outlet, there's also a trend toward the true ethical drug outlet—the drug store that is a true professional pharmacy. It sells nothing but health needs



and perhaps a few beauty aid items. In 1962, there was a definite increase in this type of drug outlet. 8. Some drug outlets are experimenting with coin-operated soda fountains and coin-operated luncheonettes. The drug outlet may become a leader in the "automatic restaurant." The drug chain may also move into other forms of automatic vending—for example, two Walgreen drug stores were, early in 1962, testing coin-operated food vendors located outside the store. One machine sells bread, cookies, crackers, and potato chips. The other sells milk, eggs, bacon, and butter. 9. The independent druggist is moving toward the voluntary chain or cooperative chain concept. This is inevitable. Just as the food outlet independent survived by turning to the voluntary chain and co-op chain concept, so will the independent druggist develop this form of chain operation in order to meet the competition both of the corporate drug chains and of the other corporate chains that are opening drug departments or drug stores. In the food field, the various types of independent chains now control a larger dollar volume than do the corporate food chains. That has been reflected in substantial changes in marketing by the food processor. Similarly, as the independent druggist begins to buy and to promote jointly, either under the auspices of the drug wholesaler or in other ways, suppliers to the independent drug outlet will be faced with substantial changes in their total marketing procedures. 10. Labor unions are becoming a factor in distribution of drugs. This takes several forms. It includes the operation of drug stores by labor unions. It also includes special arrangements by a labor union with a group of drug stores; under these arrangements, members of the labor union get special price privileges. American Druggist, reporting on this trend, pointed out that in a single month, in 1962, the following union developments took place: In Portland, Ore., a prescription department was opened in the Teamsters Medical Center, operated by the local union of the International Brotherhood of Teamsters. In Milwaukee, Wise., the leader of a local AFL-CIO union of government employees said the union would open a "cooperative pharmacy" soon.



In Philadelphia, the local organization of the International Ladies Garment Workers began the operation of a pharmacy in the union's health center. In Cincinnati, the director of an optical service catering to union members said he planned to expand into the prescription field. American Druggist then went on to remark: The connecting link in these actions is, of course, the fact that all involve direct entry by labor unions into the practice of pharmacy. To be sure, union activity in the prescription field is nothing new. It goes back almost 50 years. But there are unmistakable signs that organized labor is on the threshold of greatly increased participation in the dispensing of prescriptions. The 4 cases just cited—all occurring within one month—certainly constitute such signs. Other signs can be found in recent developments like these: The action of the Textile Workers Union of America in opening a pharmacy in a new health center in New York City. Last year's opening of two pharmacies—in Lincoln and Omaha, Neb.—serving union members only. The arrangement worked out in South Bend, Ind., whereby 3 pharmacies fill Rxs at special prices for members of unions belonging to the St. Joseph County AFL-CIO Council. The arrangement in New York City whereby reportedly more than 2,000 drug stores have agreed to fill Rxs under an agreed-on pricing schedule for members of the local bricklayers' union. In spite of opposition by the Metropolitan Drug Association of St. Louis, a Voluntary Health Plan whereby union members can buy prescription drugs in conventional drug stores at discount prices was rapidly gaining ground in that city.

Some 75,000 union members were enrolled in the plan early in 1962—not including dependents. Potential membership is said to be 300,000 to 400,000. Twenty drug stores have signed up to service these people. Briefly, the union members carry a card which they can present to druggists for prescriptions. The card entitles them to discount prices.
A pharmacy that will fill Rxs and sell drugs "at cost" for 3,500 textile worker families is part of a new pharmaceutical-dental cen-



ter opened in New York City under sponsorship of the Textile Workers Union of America and textile makers. 11. A very interesting development involves the coming emergence of the gas station as a competitor of the drug store. The gas station is destined to become a major retailer of many nonautomotive clas sifications. The giant refineries are now heading energetically in this direction in their service stations. As part of this infant trend, the gas station is putting in racks featuring drugs, cosmetics, toiletries. By early 1963, in California alone, some hundreds of gas stations will have these racks—and since test racks are averaging a $300 per month volume the total turnover could, obviously, give the traditional drug outlet cause for concern. This will take place in the entire nation—the gas station is destined to become a major outlet for certain drugs, toiletries, and health and beauty aids. 12. Drug chains are faced with the specific problem of achieving considerably larger size—quickly. The reason is obvious: the drug chains now face competition from other mass retailers much larger than the drug chains. This was underscored when Sears decided to open drug stores. (This was one of the reasons for the negotiations between United Whelan and Consolidated Sun Ray.) It is probable that, through the merger route, several drug chains will double and triple their size over the next two or three years. 13. Several drug chains are testing in-home selling. These tests are on a very small scale. However, most mass retailers are experiment ing with in-home selling, and the drug chain feels compelled to fol low suit. In much the same way, several drug chains—Thrifty Drug, home based in Los Angeles, is an example—are testing the catalog order desk. Whether these infant trends in the drug outlet will ever grow lustily could be questioned. But they serve to underscore the willingness of the drug chains to experiment. 14. Another example of this willingness to experiment is the ar rangements made by Walgreen with Horn & Hardart. Under this plan, Horn & Hardart will operate a self-service frozen food depart ment in a Walgreen drug store. Horn & Hardart operates such sec tions in some food supers—and, since the drug outlet is clearly mov ing into some food classifications on an expanded scale, this frozen food experiment is entirely logical. (It is pertinent to note that Skaggs opened a drug unit in Tulsa that included 3,500 square feet for food.)



15. The hospital pharmacy is a fairly new type of drug outlet. It is expanding rapidly. In five years, 35 to 40 per cent of all prescription drugs may be dispensed through hospital pharmacies. 16. A 1961 issue of American Druggist carried a fascinating re port on an electronic device apparently capable of filling prescrip tions automatically—an electronic pharmacist, in other words. The title and subtitle of that news article read as follows: "Electronic 'Brain' Fills Rxs in Hospitals. 96-Drug Device 'Reads* Plate Bearing Rx Order; It Also Affixes Label and Issues Charge Slip." The opening paragraph reads this way: "An electronic *brain' which fills prescriptions automatically, and which eventually might be capable of taking over many of the functions now performed by registered pharmacists, has been developed by the Brewer Pharmacal Engineering Co., of Upper Darby, Pa., and is now in operation in two Pennsylvania hospitals." The automated pharmacist works this way: (1) The nurse puts the doctor's prescription onto a plate, plus the patient's name. (2) The plate is fed into the machine. (3) The automatic dispenser does the rest, including the necessary accounting. (4) The device will handle 96 prepackaged drugs, which account for 90 per cent of the drugs normally required for everyday use at hospital nursing stations. Is it totally impossible that an electronic device of this type may some day perform "many" of the functions of the pharmacist in the drug store? Could it be, for example, that at some future time, the doctor or the doctor's nurse will put a prescription (not all prescriptions, but many) on a plate or punched card, the patient will insert the card in a machine, and that machine will do the rest? And if this procedure proves practical, will doctors dispense still more drugs from their offices, from hospital dispensing drug facilities, from drug outlets owned by doctors? Will such a machine ultimately be put to work in all types of drug outlets? An electronic device which might eventually be capable of taking over many of the functions now performed by registered pharmacists is clearly within reach. Of course, an automated device presumably has some limitations —although scientists at such great laboratories as those maintained by IBM see fewer limitations to these devices than do most unin-



formed lay people. But suppose we accept the premise that an automated machine of this kind could function in connection with only 90 per cent of the prescriptions typically filled by the pharmacist— as it apparently can do right now at the hospital nursing station. Isn't it possible that the remaining 10 per cent will be handled in some way or ways that will also bring down the costs of these minority prescriptions—for example, by huge central prescription facilities using assembly line techniques? Once the pharmacist accepted prefabricated prescriptions to the point where less than 10 per cent of the prescriptions are actually compounded by the pharmacist—the road was clearly opened for an "automated Rx man." (When an electronic dispensing device is introduced, the drug manufacturers will surely put their drugs into packages that the machine can handle.) 17. The current pattern of pharmaceutical distribution—manufac turer to distributor to retailer—may be in for some changes if the predictions of Stewart Ruch, marketing vice president of PitmanMoore, come about. Speaking before the central section of the Pharmaceutical Manufacturers Association in Chicago, in 1962, Mr. Ruch said that the invasion of the prescription field by supermarkets, discount houses, mail-order firms, and other outlets is forcing pharmacists to "demand price bargains from their sources of supply." "In general terms, this means direct buying from the manufacturer, at least on fast-moving lines on which consumer price battles are being fought. This battle is already under way on those products used for maintenance and chronic-type therapy." This is an infant trend that could shape up into major marketing changes. 18. Drug chains are moving into various soft-goods classifications at an accelerated pace. When Crank's opened a new unit in Wichita, Kansas, it included a 14,000-square-foot apparel center. The giant Katz Drug discount units have large soft-goods sections—so do the new Sears drug stores. This is still an infant trend in the drug out let, but it shows every indication of growing up, especially in certain staple soft-goods classifications. 19. Simultaneously, the drug chains and independent drug stores are developing their volume on big-ticket lines, particularly bigticket hard lines. Between 1960 and 1962, big gains were made by



the drug outlet in these big ticket classifications. This infant trend also promises to develop into a major trend. (The new Sears drugstores will propel the drug outlet in this direction since these Sears drug stores will sell big-ticket lines both from floor inventory and from a catalog order desk.) 20. It is probable that the drug outlet will feel compelled to enter the rental business. Its competitors have begun to rent various sick room equipment and the drug chains cannot afford to stand still under this competition. Once the drug chains begin to rent wheel chairs, hospital beds, crutches, etc., they will then start to rent other items entirely removed from the health field. 21. The infant trends involving soft goods, big-ticket lines, rentals, food, etc., suggest that the drug outlet will, in time, turn toward greater use of leased department operators for these newer classifi cations. In the giant Katz stores, the following departments are leased: gas-automotive, records, electronics, jewelry, sporting goodstoys, ladies' wear, men's wear, shoes, snack bar, photo studio, cam eras, credit, insurance, domestics, and candy. Obviously, this means that some manufacturers will find it necessary to seek drug outlet distribution through various types of leased department operators, including some types of rack jobbers. 22. Incidentally, it is significant to note that Katz is merchandising gasoline, oil, tires, batteries, and auto parts and accessories. A few other drug chains are dipping toes into these classifications. The new Sears drug stores will not overlook these classifications since this technique has been a Sears ace for years. This infant trend will also take this outlet into some of the newer forms of services, such as coin-operated laundries, etc. 23. At the start of 1962, it was reported that some 526 physicians owned some 213 pharmacies in California. This trend by doctors to own drug stores has kicked up quite a fuss. It seems to have started in California—and has since spread to other states. In some instances, this trend is tied up with the trend toward medical group practice. That is, when a group of doctors form a joint clinic, the group sometimes concludes that a drug store is a logical next step. Some retail pharmacies are developing a substantial volume by supplying local industries with complete medical departments. In addition, some drug outlets are extending what they call "bulk rate courtesies" to the employees of these plants. In view of the broad



tendency of the general public to conclude that drug prices are too high, this form of distribution of drug products could assume respectable size in time. If so, it would have to be reflected in drug manufacturers' marketing programs. 24. Several references have been made to the Sears drug outlets. Inasmuch as it is entirely likely that the Sears drug stores will set powerful new trends in the drug outlet, it is logical to study the Sears drug outlet program in some detail. In the first place, it is highly significant to note that the Sears drug store will feature, not only Sears' brands of drugs and vitamins, but also the brands of many manufacturers—and at "discount" prices. What Sears does with manufacturers' brands in its own stores will unquestionably affect the marketing policies of these manufacturers because the traditional drug chains will be compelled to meet Sears' competition. The first Sears drug unit, which was opened in the spring of 1962 in Fort Worth, Texas, included the following departments and sections: Notions Juvenile furniture Toys-Hobbies Records Hair products Cameras Matched outfits, campus slacks Stationery, greeting cards Auto polish, laundry supplies Glassware, kitchen gadgets Pet supplies Tobacco Men's wear, women's wear Garden supplies, hardware Shaving cream, laxatives Sanitary napkins, dental needs Bath shop Foot care items Baby needs Rubber goods Prescriptions, vitamins



Plumbing needs, electrical supplies Paints Beachwear Artificial flowers Coffee bar, snack bar Cosmetics Sporting goods Sleep shop Appliances Sickroom supplies Magazines, books Giftware Drugs Sundries Sears mail-order catalog desk Sweaters, lingerie, hosiery Costume jewelry, gloves, billfolds, underwear Packaged candy The pharmacy, drug, cosmetics, and sundries sections occupy about 20 per cent of the total selling floor area, which measures about 12,500 square feet. There is little question that, in time, the Sears drug stores will profoundly affect the policies and practices both of the established drug chains and of many independent drug stores. And this, in turn, will dictate new marketing programs by many manufacturers. In summary, the drug outlet is deeply involved in a variety of infant trends that promise to revolutionize this important outlet. Moreover, other mass retailers are moving into the retailing of traditional drug outlet merchandise classifications in a major way. In combination, these two trends are bound to bring about fundamental changes in the marketing philosophies and practices of manufacturers whose lines fall within these merchandise classifications.
Infant Trends in That Giant Infant—the Discount Chain

The remarkable growth of discount chains in just three years constitutes one of the most convulsive revolutions in modern retailing's history. Not one of our traditional forms of mass retailing—department stores, variety chains, drug chains, not even the food supers— grew so enormously, so fast.



1. This giant infant is, however, beginning to show signs of some new infant trends that may blossom into giant size almost as rapidly as did this unique form of retailing. Example: Even the term "discount" itself is apparently beginning to wear thin. As a consequence, Korvette prefers not to be called a discount chain. Korvette insists it is a new type of department store. Several discount chains that formerly used what had been considered a magic word—discount —have dropped the word in their advertising and even from their store signs. By the summer of 1962, there was multiplying evidence that the term "discount" or "discounting" was beginning to wear thin. Some of its connotations were becoming less favorable. It is probable that, within just two or three years, the large low-margin chains that will gobble up the major slice of total volume done by low-margin stores will have soft-peddled, or dropped entirely, the use of that oncemagic word "discount." Among the several reasons for this march away from the term "discount" is the conclusion of the major low-margin chains that there really is no such shopper as the "typical" customer in these stores. At one time, it was the assumption of all low-margin retailers that their customers were the low-income families, particularly the so-called blue-collar worker family. But now there is a trend of thinking in low-margin circles—an infant trend, if you will—that concludes that their major customers are not necessarily those who must save every penny. These outlets are now about ready to accept the premise that they can pull in affluent customers who want to save money. They are setting their sights for the white-collar classes. That involves trading up. And, when a retailer trades up, suppliers are promptly affected. It is a bit difficult to determine in this situation which came first —the chicken or the egg. Are the low-margin outlets trading up because rising costs compel them to do so? Or are they trading up because they have concluded that the somewhat more affluent segments of our society are their best customers? That question may never be answered. But there is not the slightest doubt that the low-margin stores are trading up—trading up the appearances of their stores, trading up their price lines, trading up their services—and moving up their margins. These have been infant trends in these outlets in 1962—and much more in evidence in some



of the low-margin chains (Korvette would be an example) than in others. Naturally, this trend is of considerable significance to manufacturers. If this infant trend develops substantially, as it most likely will, it means that this outlet will offer new markets for merchandise lines, for brands, for price lines, that previously had not figured in their merchandising calculations. 2. The proliferation of low-margin outlets has resulted in a startling change in the competitive factor for this outlet. Originally, the competitors for this new outlet were the established retailers. Today, in more and more instances, new discount stores compete with established discount stores. This new trend is producing some profound reactions. For example, the infant trends being spawned by this basic change include the following: A. The fantastic return on invested capital recorded by this out let is tapering off. This downgrading of capital return figures will continue. B. Margin requirements are moving up. C. Sales per square foot are drooping. Soon they will drop—quite sharply. D. Markdowns will increase. E. Older stores will have to be closed out F. Customers are no longer drawn from distances of up to 20 miles; the trading area draw for the discount stores is shrinking rapidly and even drastically. This, in turn, may eventually compel this outlet to turn to smaller store units. Clearly, the smaller the shopulation a store may count on, the smaller the store must be come. G. The crack in the armor of the discount operation is that this outlet must depend on high sales to maintain its cash flow, because most are undercapitalized and maintaining this cash flow is becom ing a serious problem. These developments are not cited as evidence that this new type of retailing is destined to collapse. That isn't so at all. To the contrary, the total volume done by the low-margin outlet will hit a new peak in 1962. It will hit a still higher peak in 1963— and probably still higher in 1964. By 1965, however, its rate of growth may begin to taper off. In the meanwhile, a period of consolidation will set in.



3. Each of these infant trends in the discount outlet will, in turn, spawn one or more still newer infant trends. For example, all of the adverse factors cited up to this point will, without fail, lead to a higher death rate among low-margin outlets. The failure rate had begun to perk up early in 1962 and mounted with each month at an accelerating pace. That, in turn, will lead to a weeding out which will leave die powerful low-margin chains still more powerful; still more in control of this new form of retailing. Among the variety chains, an even dozen practically control the volume done by this outlet. It is probable that, within two or three years, some 20 or 25 discount chains will control from 40 to 50 per cent of the total volume done by this outlet. (At the end of 1961, 14 discount giants accounted for 28 per cent of the total volume done by this new outlet.) Manufacturers selling to and through the discount outlet will, therefore, soon be faced with the identical situation that faces them in other types of mass retailing—the problems inherent in dealing with retail giants. 4. The observations made up to this point have had to do exclu sively with the new discount outlets that have grown up in recent years. But what about the discount outlets announced by depart ment stores, variety chains, drug chains, and food chains? In 1962, they constituted an infant trend. How much of a factor will they become in the years ahead? How much competition will they give the original discount outlets? In total, the discount outlets and discount departments developed by traditional retailers will not account for a dollar volume that will match that of the original discount chains. At the end of the first half of 1962, traditional retailers were still merely experimenting with discount stores and discount departments. This was an infant trend up to that calendar date. And while it surely will not remain an infant trend, there is little reason to expect that traditional mass retailers—department stores, variety chains, drug chains, food chains—will ever become major factors in low-margin retailing, with possibly a very few exceptions. In the first place, these older retailers had all become high-margin retailers over the years. That they will succeed in turning back the clock, that they will succeed in slashing their costs—especially their high administrative costs—is difficult to believe. In the second place, the very fact that the newer discount stores are in a rising cost phase



means that these outlets are adding services and frills which the traditional outlets, in their discount units, will be compelled to emulate. This means that the margin requirements of the discount units of the traditional merchants will go up for this reason also. 5. Getting back to the discount chains, it may be expected that, as the consolidation period emerges, mergers will multiply. The bet ter store units operated by small, or financially weak discounters will be taken over by the growing discount giants. Women's Wear, in a report on the discount situation in Los Angeles, in April, 1962, stated: A few tremors being felt in discount territory may be the start of the long-predicted shakeout here. Some of the weaker, outdated discount houses already are swaying alarmingly, and even a few stronger, solidly constructed structures are showing some cracks. This year, it appears, will be a time for some retrenchment in southern California, a period when low-margin operators check their headlong building rush in order to plaster the cracks, shore up the foundations, and step back to re-examine the blueprints. Heaviest damage is being suffered by some smaller discount stores that failed to modernize and diversify. A number of recent arrivals who went into business with insufficient capital and poor management are finding themselves in deep water. Even well-planned, well-capitalized stores are running into difficulties. A recent management squabble brought out testimony that Scoa, one of the giants fighting for dominance in discount-thick Covina, lost $62,000 in one month recently. Trade observers have long contended the first consequence of a discount shakeout would be for weaker closed-door units to go open door—which already has occurred in numerous instances here. The next step, they predicted, would be a whittling down in numbers of stores in saturated areas, either by acquisition or outright closure.

After the consolidation phase is well along, there will be some discount chains with an annual volume ranging from $500 million to $1 billion. With that kind of volume, these discount giants will not have much trouble getting most of the national brands they may want; they will not have to settle any longer for special brands unless they are so minded. 6. What is more, as discount chains become giant retailers, they



too will turn to their own controlled brands. These private brands of discount outlets were in an infant trend during 1962. It may very well be that the discount chains will emerge with a larger percentage of their volume in private brands than traditional department stores will be able to duplicate. These private brands will, in many instances, be supplied to the discount chains by manufacturers of presold brands. 7. Reference has already been made to accumulating evidence that the discount chain has begun to depart from its fundamental policy of concentrating on the fastest-moving numbers. This outlet's great source of strength lay in its inventory policy of "thick on the best, to hell with the rest." But that policy is destined to go by the board. As the discount chains fight to attract ever higher income groups without losing their lower-income customers, it is inevitable that they will add new price lines, broaden assortments of models, colors, styles, sizes, etc. This infant trend shows every indication of growing up into adulthood—and for many manufacturers this means that their distribution through this outlet will begin to resemble more closely the pattern of distribution through traditional outlets. 8. The discount chains are locating increasingly in shopping cen ters. This is an interesting trend. Just two or three years ago, dis count outlets were compelled to open stores just outside of shopping centers because they could not get into the sacred confines of shop ping centers. But Chain Store Age estimates that, of 900 new chain discount stores to open in 1962, some 250 will be located in shop ping centers. Shopping center promoters have concluded that dis count stores bring traffic to a center, and shopping centers are mul tiplying so rapidly that traffic is dwindling. Moreover, discount stores located just outside a center were getting all of the benefit of the pull of the shopping center without making any contribution to the center. It became the old, old story; if you can't fight 'em, join 'em. With discount stores in shopping centers, many manufacturers will be compelled to reappraise their distribution through other out lets in discount-dominated shopping centers. 9. The membership department store, as a concept, appeared to have reached its zenith by late 1961. Several sizable closed-door discount chains began to open their doors in that year. Several more opened their doors in 1962. This trend will accelerate. However, it does not mean that all closed door chains will open their doors; not



at all. But it does mean that, on balance, closed doors will tend to open their doors. Once the closed-door or membership discount chain opens its doors, its inventory must change. This is due to the fact that the inventory of a closed-door chain is keyed closely to the specifically known requirements of its clearly defined customers. Usually its customers come from a closely knit group and are confined to a narrow income range. The inventory is planned accordingly—this was one of the strengths of this type of discount operation. But once the doors are open, inventory must be broadened to match the broader range of customers and, as a consequence, the buying policies of these chains must change. That automatically is reflected in their buying arrangements with their suppliers. 10. A change is showing up in the buying policies of some lowmargin chains. The discount chains had dynamic buyers. Open-tobuy restrictions, typical of traditional mass retailers, were practically unknown in this outlet. But, starting in 1962, the open-to-buy concept began to win a toehold in the discount chains and this infant trend, with all of its accompanying problems for manufacturers, promises to grow. Reporting on this subject, Women's Wear had the following to say: Open-to-buy restrictions—plus growing controls—are reportedly accompanying discount store expansion. Several discount buyers—in pointing up the situation—are heaping considerable abuse on their merchandise managers or divisional merchandise managers. In some cases, criticism is leveled at men, primarily with a conventional retail background, who have been with the discount stores a relatively short time. The major area of friction: Merchandisers and buyers are not seeing eye-to-eye on buying policy, notably timing of purchases, depth of stock in certain categories, price lines and closeouts. A number of discount buyers heatedly insist that the advent of conventional store authority is seriously affecting what heretofore has been a fluid and flexible open-to-buy. These newly imposed restrictions, they charge, are tending to minimize a decided buying advantage over the conventional store with its rigidly controlled purchasing policy. Problems with merchandise managers, of course, are old hat to many conventional store buyers. In the case of discount buyers, though, many of whom have had a virtually free hand in buying, sud-



den controls and curtailed authority are new and disturbing experiences. Such action at discount houses has long been predicted by conventional store merchants. With the added burdens of more stores and broader merchandise lines, discount owners can no longer continue to do most of the buying and merchandising themselves with the help of a few buyers, it is pointed out. As a matter of fact, some discount chains have begun to install fairly elaborate systems of unit control which had been rather rare in this outlet. 11. The discount outlet is making faster progress with gas stations, with tires, batteries, and auto accessories than any other outlet, with the exception of Sears. It is also making rapid progress with such entertainment services as bowling alleys and skating rinks. And it is probably leading most other retailers in the installation of coin-operated laundries, etc. Some discount outlets are offering travel services, insurance services, even mutual fund investment services. Indeed, several discount chains are offering services as price leaders—a car wash, for example, for 59<f. The discount outlet, originally, did not go in strongly for loss leaders. There is now a definite trend in this direction. Coffee at 9# a pound is a fairly typical loss-leader event. These loss-leader promotions will multiply as this outlet fights to maintain its vitally necessary traffic count. In summary—the great wave of discount retailing is destined to top out. As its tide ebbs, it will go through new trends at an extremely fast pace in a fierce effort not merely to stem the ebbing tide, but to reverse it and to achieve new high-water marks. As it works out new ideas involving its "image"—new ideas involving the proper mix of soft goods and hard goods, the proper mix between staple, semifashion, and fashion merchandise, the proper breadth as well as traditional depth of assortments—as it tries out new inbetween price lines, as it trades up, as it adds new merchandise classifications and new service departments, as it works toward its destiny as a new type of department store—it will give innumerable manufacturers innumerable headaches, and innumerable new opportunities. Download your free copy today!! Download your free copy today!!

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