By David Castlegrant
Surplus Today conducted an industry survey to gather insight and specifics about the military surplus industry, the challenges and solutions they face.
Army Navy surplus store owners are faced with surviving in a niche market that in part relies on a specific type of inventory to support their customer base. Surplus retailers are often small brick-and-mortar operations, managing a small number of employees and serving a limited customer population. With the odds stacked against them, how do military surplus and outdoor supply retailers survive?
Challenge #1: Limited access to true military surplus.
Network. In the survey, 80% of respondents stated that they were primarily interested in obtaining information on new products.
In today’s world, authentic military surplus is limited in availability – just ask any of your traditional surplus wholesale suppliers! One solution is to think creatively and proactively. If you can’t get specific styles of clothing or types of gear you once carried,, find an equivalent “knock off” look or new style that can make up for it. Talk with your suppliers for ideas. Collaboration is the key. Remember: your success is their success. Your suppliers are always willing to provide ideas and advice.
Ask your Customers what they want and expand your product selection to meet their needs.
Have a notebook at the front register or keep a pocket version and make notes of your conversations with your customers. What types of products are they looking for? Evaluate your customers’ requests by simply ASKING THEM. Helping an individual is beneficial, but you must examine all options to see where you are missing out on profitable opportunities.
Challenge #2: Lack of brand awareness, preventing potential customers from knowing the business even exists and missing out on untapped markets and profit.
Market and brand your business.
Diminishing foot traffic and disappointing sales numbers are another daunting element facing retail stores of all types. One of the most difficult, but essential tasks for any business is to keep their name & brand top-of-mind. According to the industry survey, almost 50% of surplus owners and managers indicate that they operate within a trading area less than 500,000.
48% of survey respondents state that their percentage of advertising expenses to total revenue is under 2%. Many of the retail store owners have legitimate concerns about how to most effectively spend their advertising dollars, too.
In order to properly analyze marketing effectiveness, business owners/managers should try to first ascertain what do you want people to know about your business? What will people be doing with the products they purchase from you? The answers to these questions are the impressions that customers and potential customers hold every time they drive by your store or see your logo. Your brand is one of the most effective tools in spreading the good word about your business and bringing in new customers and creating all-important repeat customers. But, the brand must first stand for something. If it doesn’t, you have got some work to do.
Ask yourself, are you doing everything you can to bring people into your business based on the products your offer and the services that you provide. If not, then that is a large reason why people do not know your business or what you have to offer, and therefore, they are not coming to your store regardless of the ad dollars spent.
Analyze your location and customer demographics.
How many people do you see driving by your store or visiting other businesses around you? Are they families? What demographic information, like age and gender, can you determine? What about buying habits based on their clothes and car? Do these individuals know about your company and would they be interested in what you have to offer?
Challenge #3: Lack of technology for buying and selling.
Create a website
According to the survey, 66% of respondents have been in business for over 20 years, but 30% do not have a website. Embracing new technology can be a very tough transition, especially when stores have been in business for so long.
With a changing technological climate, keeping up with the commercial success of online and shopping demands can be an arduous challenge for smaller retailers. The personnel and logistics needed to manage building a web presence can seem daunting, but there are low-cost options.
Building an e-commerce site was once a time-consuming, energy-draining endeavor. Now, open source software, elaborate content management systems and advanced graphic/web design software can provide you with a world-class website for a significantly lower cost than you might think. Ecommerce offer many new opportunities to build your business in today’s digital world.
Surviving in the military surplus field can bring numerous challenges and hardships. These can be overcome by imaginative thinking, relentless persistence and proactive business moves to grow and maintain your business well into the future. An important thing to remember is that surplus retailers are destination stops – their customers will seek them out because of the rich history these stores possess. Surplus stores are viewed as a place of safety and certainty – even more so in uncertain times.