Source: Office Depot Associates Routinely Lie about Notebook Stock.
An example of doing the wrong things, putting margin ahead of customers. I get that laptops are a lost leader, but you cannot penalize your customers and give them an excuse to go to the competition. In many instances, accountants focus too much on the numbers, not realizing the implications on customer LTV. Hourly associate performance based compensation, coupled with strict mandates from the bean counters can lead you down the path of the dead pool. Wake up Office Depot, don’t forget what happened to Circuit City when they fired all of their most experienced sales associates in exchange for cheaper and less experienced bodies.
Rather than avoiding a sale with zero or negative margin, or penalizing associates for selling products with no margin, why not focus on the positive and reward the for up-selling and cross-selling. If you do not want to sell laptops at a loss, get out of the business. It is the nature of the beast. You don’t find the margin in the laptop, but the accessories and services you sell along with it. More importantly, where you make your money is in establishing a long term relationship with your customers. That relationship is based on the little things which amount to a lot:
- Exceptional value
- Extra-ordinary service
- Customer empathy and passion for what you do
- A Customer First mentality
- Letting the Long Tail drive your short term behavior
- Winning the hearts and minds of your customers at every point of engagement
To win the war in retail, you have to plan out your battle strategy. The strategy must have an end state goal of winning the war. Winning one battle, without planning for what’s next will lead to your defeat.
If you want to charge more than your competition, you must provide something more in the way of service, convenience, product availability, a meaningful loyalty program or something else you feel is on par. To say you are out of a product gives your customers a reason to go to your competition and never come back.
See the big picture guys or your customers will show you the door. Just the fact that an article like this is written about you is bad enough. What are you going to do to remedy the allegations. You can’t bury your heads in the sand, you need to change your orientation and start looking through the right end of the telescope to see beyond the short term.
