Stew Leonard’s vs. Bob’s Farm Market; Home Depot vs. Cedar Mountain Stoves; Doogie’s vs. Hooters.
Target and Wal-Mart vs. everybody.
Low prices vs. personal service; vast resources vs. vast experience; brand recognition vs. neighborhood reputation.
In a slowed economy, the never-ending war of big business vs. small business isn’t about who wins. It’s about who doesn’t lose.
“Customers are still very worried about price and how much they spend, so there’s been no real improvement in that,” said Bill Wertz, Wal-Mart’s Connecticut spokesman. “Customers still are spending less on discretionary items.”
The Berlin Turnpike in Newington and Wethersfield is a battlefield for the disposable dollar. Retail stores, hotels, restaurants, grocery marts and specialty stores — big and small, chain and independent — line both sides of the divided highway. While a new Holiday Inn Express opens next to U.S.A. Motor Lodge in Newington, closed down superstores such as Circuit City and Bernie’s TV and appliance wait for new tenants.
“For people to buy something on the Berlin Turnpike, you have to come from somewhere and you have to have the money in your pocket,” said Bill Moore, co-owner of Military Specialties, Inc. in Newington. “Sometimes it’s just easier to sit at home on your computer and buy the things you want with a few clicks.”
To survive in a rough economic recession, companies must utilize their available resources, and find a niche people respond to — product, atmosphere, knowledge — to develop long-term, loyal customers.
With its one-stop, something-for-everybody shopping, Wal-Mart benefits from customers desire not to drive around to multiple businesses, spending gas money, Wertz said. With nearly 8,500 locations worldwide, the superstore has the collective buying power to offer low prices and the geographic reach to tap nearly every market.
“We are not necessarily the lowest price on every time all the time, but we do offer better prices that the competition more often than not,” Wertz said. “Our principal advantage is our low prices.”
The recession hasn’t turned around yet, Wertz said, as the bulk of store sales come at the start of the month when people get their paychecks.
“The economy is certainly recovering for us,” said Rock Aronheim, owner of Doogie’s restaurant on the Berlin Turnpike in Newington. “In tough times, every restaurant owner looks for places to cut, and I made sure we never cut back on quality.”
Doogie’s commitment to quality paid off in the past six months, garnering national recognition for its hot dogs. In December, the Travel Channel aired an episode of Man v. Food that featured Doogie’s and the latest issue of Every Day with Rachael Ray magazine named Doogie’s hot dog as the No. 1 grilled hot dog in the country.
Business has boomed ever since, Aronheim said. To keep those new customers coming back, Doogie’s will stick with its commitment to quality, community service, and a friendly, laid back atmosphere.
“We have a lot of humor and personality in the store,” Aronheim said. “A lot of places, you walk in, and the employees don’t say ‘Please’ or ‘Thank you.’ Personality is a big part of our business.”
In 2007, Stew Leonard’s opened one of its four unique fresh food megastores on the Berlin Turnpike in Newington, and revenue has increased strongly every year, said Vince Summa, company chief financial officer.
Customers responded to Stew Leonard’s specialty of providing locally grown produce and prepared foods made from scratch in house, Summa said. Rather than going up against the super grocery stores, Stew Leonard’s thrives by only offering items where it can be competitive in price and quality; the store stocks 2,200 items compared to a typical grocery store’s 55,000.
With four stores, Stew Leonard’s can incorporate fresh ideas from one location to all the locations, Summa said.
Traffic counts have eroded over time on the Berlin Turnpike, making it difficult to drive up business along the less busy road.
In 1994, when Jason Humphries opened the first Pet Supplies Plus in New England on the Berlin Turnpike in Wethersfield, the traffic count in front of his store was 50,000. That number dropped to 41,700 by 2000 and to 40,100 in 2008, according to the Connecticut Department of Transportation.
“The Berlin Turnpike location is flat. The other locations I have in Connecticut are up about 5 percent in sales from last year,” said Humphries, who has eight Pet Supplies Plus stores in the state. “There’s just less draw on the turnpike. Circuit City is gone. Bernie’s is empty. That eventually affects the traffic that we get.”
The Circuit City in Newington will get a revival of sorts in August when New York-based P.C. Richard & Son opens up its sixth Connecticut electronics store in the empty Berlin Turnpike facility.
“Circuit City left a very big void in the marketplace, so you can get good real estate at a reduced level; the former Circuit City employees with their expertise are available; and the former Circuit City customers are looking for a new store,” said Gary Richard, CEO and chairman of P.C. Richard & Son. “When the chips are down, it is time to invest in the economy for the future.”
With 62 stores and counting, P.C. Richard has the buying power to offer competitive prices and the advertising power to strength its regional position, Richard said.
“It is very difficult with just one store to survive,” Richard said.
Bob’s Farm Market has survived on the Berlin Turnpike in Wethersfield for 33 years, since owner Bob Yandow was 18 years old. The customers of the produce and plant store know Yandow, and customers will ask where for him if he’s not there.
“You can put a face to what we’re doing here,” Yandow said. “I’m an ambassador of the business.”
While the lawn and garden market has been saturated as the likes of Home Depot, Wal-Mart and Lowe’s have entered the fray, Yandow said he thrives by offering what the big businesses can’t: years of expertise and friendly service.
“At those places, they may not have the knowledge or the time to answer your questions,” Yandow said.
As customers are spending less on discretionary items, Wal-Mart relies more on its steady selling of low-priced essentials.
In addition, rather than laying people off in the recession, the company can shift employees to different departments to keep their institutional knowledge.
“If you take care of your employees, they take care of your customers,” Summa said.
The lawn and garden business is heavily influenced by the weather, but business among local stores is down 5-30 percent even compared to last year’s dark and cold June, said Yandow, quoting statistics from his suppliers.
Yandow said it’s difficult to say when that trend — much like the economy — will reverse itself.
“It has gotten to the point where you are afraid to ask people how they are doing because one spouse or both have been laid off,” he said.
Road to Recovery Part III:
Finding Niche Key to Business Survival, Regardless of Corporate Size
