Who’s Driving This Bus?

December 11, 2008 - 10:37

In the olden days, growers grew the plants, and it was the retailers’ responsibility to figure out how to sell them to the end consumer. Once you delivered the plants, your job was done. Life was simple and relatively easy. But that was yesterday’s thinking, not today’s. (Though many of you may wish that was still the way we did business!)

There have been massive changes in the past five years or so in the roles growers have taken on in developing marketing programs; some of them have been voluntarily implemented by you because they made good business sense, and some have been forced on you, as in pay by scan (PBS). But no matter how you arrived at this place, our industry is all the better because of your involvement and the contribution of your perspectives and expertise.

A Three-Way Partnership

Yes, it’s been a few years since I sat in the buyer’s chair, making product assortment, inventory and merchandising decisions. But what made my retail program successful was that I understood that my role was pretty simple: acting as the intermediary between my customers and my suppliers. I recognized that my suppliers knew far more than I did about the product — timing the appropriate product for the right market (even down to micro-marketing by individual store and micro-climate) and having the correct inventory levels to maintain turn. My strength was in knowing my customers and their needs; I religiously studied them by walking the stores, listening to my garden center teams, and analyzing the demographic data and feedback from focus groups.

We created a true three-way partnership, understanding that the retailer, suppliers and customers were mutually dependent on each other, and none of us could succeed independently. And this was a true partnership, not a fairweather relationship where, when something went awry, the finger pointing started. (We used to call these relationships BOHICA partnerships. E-mail me, and I’ll tell you what BOHICA stands for).

There were times where, based on the season or the challenges or issues, the buyer or the supplier took a more active role in the partnership, and this changed as the need dictated and was almost unconscious and seamless. We both recognized that different situations required different knowledge bases or skill sets that one of us was in a better position to provide. And this lead-role ebb and flow worked because we were partners, and egos didn’t get involved. We all wanted one thing and shared a common goal and vision: to make the program work and the customer successful. We understood that if the customer won, both the retailer and the supplier partner won.

I realized early on in my retail career that it was as important to understand my weaknesses as it was to understand my strengths, and then reach out to my suppliers and other business partners to compensate for my weaknesses or lack of expertise. It was an admission on my part that I was not the “almighty” buyer who had all the answers and that if I truly wanted to succeed, I had to rely on others to reach my goals. This philosophy really worked, and there are growers out there who can attest to its reality and success. And this philosophy is as applicable today as it was back then.

The Outlook for Today

In today’s marketplace, there are still those relationships that are strictly buy/sell, with little partnership between the trading partners. But more and more, the buyer and seller are moving beyond the simply transactional and becoming more codependent. The more progressive relationships are three-way partnerships, a tri-dependency made up of the supplier, retailer and consumer, and the lead role in this partnership situationally shifts from time to time. Whether you personally like the pay by scan concept, this program forced suppliers to become closer to the end consumer. In many cases, entering the PBS environment was the first time growers had to directly interact with the end consumer and were directly impacted by their purchasing behavior. And most PBS growers found that there was a steep learning curve when they started facing the consumer and experiencing retail from a retailer’s perspective. Many of those growers who collaborated with their retail partners to focus on the consumer have been more successful than those who were just in transactional relationships.

I mentioned earlier that the lead roles in partnerships shift among the three stakeholders based on changing situations. With the decreased disposable income, low consumer confidence caused by the financial industry collapse, lower and more limited credit card lines, concerns with job security and lower net worth, retail sales this spring will be tougher to come by. Every retailer in every product category will be fighting tooth and nail to get their fair share of the available consumer spending dollars, and the consumer will reward those retailers who best address their needs and provide solutions to their expectations.

Now More Than Ever

It’s more critical than ever for the supplier/retailer partners to work together to identify what their specific and shared customers want and then provide the products, programs and services that meet their needs. Those teams that do this better than all of the competition — not just lawn and garden competition but competitors of all categories — will be rewarded by the consumer. Those who do not, will not. Retailers can’t do it all by themselves; suppliers and retailers must work together to understand and respond to today’s challenging consumer. Granted, this is what Retail 101 should be all about, but these troubled times and fickle consumers call for collaboration and cooperation.

It’s important to remember that in these tough times, the consumer really is driving our bus…

About The Author

Stan Pohmer is president of Pohmer Consulting Group in Minnetonka, Minn. He can be reached at spohmer@pohmer-consulting.com or (952) 545-7943.

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