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Thinking about buying into retail? Top franchisee tips

Sarah Stowe

Dave Strutton runs Howards Storage World at Mile End and he’s proving that franchisees don’t need to struggle in a retail setting.

Strutton operates one of the best-performing businesses in a franchise network that includes 34 stores nationally. His business has posted strong growth in the past two financial years at a time when some retailers are struggling amid a slump in consumer spending.

So what is it that Dave Strutton is doing that can inspire incoming franchisees to get ahead with their retail businesses?

Strutton believes some business owners are suffering because they are neglecting their core customers.

“Some retailers have lost sight of who their target customers are and they’re trying to be all things to all people,” he says. “They’re spreading themselves too thin marketing to a wide range of customers and continually offering discounts, instead of value.

“It doesn’t work and that’s something I’ve certainly learnt over the years.”

Strutton says his focus has always been to deliver good customer service and sell good quality products.

“It’s that philosophy that attracted me to Howards in the first place. We have not strayed away from that.”

From almond grower to franchisee

Yet retail hasn’t always been part of Strutton’s career. He had a business acumen from his early university days in accounting. But initially he joined the family’s 25 year old almond farm. Living in the small South Australian town of Swan Reach he and his wife decided to move their young family to Adelaide in 2007.

“We had both spent our childhood in Adelaide and we wanted to give our children the same opportunities we had as young kids,” he says.

He had been working as an almond grower for 12 years when Strutton showed his entrepreneurial spirit, running guided tours for busloads of visitors around the property.

“I discovered I really enjoyed the customer interaction and sharing my knowledge.”

So he was ripe for a brand new challenge in a new setting.

“I spotted a newspaper advertisement about a new franchise opportunity in Adelaide for a Howards store earmarked for construction, so we took a leap of faith and signed on the dotted line.”

The outlet opened in 2007. Local advertising brought in plenty of customers quickly to this new store, and Strutton was immediately faced with a big challenge: they were overwhelmed with success.

“When we opened the store it took off very quickly. We were swamped with stock and we were understaffed and the staff we had working for us were inexperienced.”

The Strutton’s franchise was the only Howards store in South Australia to survive after the franchisor went into voluntary administration at the end of 2016.

“We were always the dominant out of the four stores, which I put down to the central location, our stockholdings – we are always fully stocked – and customer service.”

A new owner bought the franchisor out of voluntary administration in early 2017 and the Mile End store has continued to thrive.

“It really was a case of survival of the fittest, but we have gone from strength to strength,” Strutton reveals.

Howards Mile End achieved growth of about 20 per cent in the 2017-2018 financial year and was also named Howards Franchised Store of the Year in 2018, an award it had previously won in 2009.

5 retail tips for success

1. Never lose sight of your core customer

Don’t waste your time and money on widespread marketing campaigns. Understand that not everyone wants to or can be your customer. Know exactly who your core customers are and focus on delivering the best possible value to them. It’s important to remain true to your brand. Don’t pretend to be something you are not, as shoppers will see straight through that.

2. Service your local area

You may be part of a franchise network, but that doesn’t mean that every store can operate in exactly the same way. What works in Bondi doesn’t necessarily work in Mile End. Tailor your products and services to suit your region and its residents.  

3. Pick a great location

We have a great location within the centre itself, the centre is a good size and central to Adelaide. We also do a pop-up store at Christmas at a Westfield shopping centre. We have a kiosk in the middle of the mall that runs from late November and that does big numbers. It’s a logistic nightmare but the sales you can get from 12 sqm are amazing. It’s a buying frenzy, there’s incredible foot traffic, you can’t miss us. We’ve been offered shop fronts but a kiosk in the middle of the mall is fully exposed.

4. Innovative products

Customers are making more conscious choices because of the war on waste and as retailers we need to recognise and respond to their changing demands and shopping habits. While quality has been the hallmark of Howards from the beginning, we are also continually adding innovative products to our range. Our customers are prepared to pay a respectable price for products that are designed to last. We have a bit more flexibility to choose beyond the approved product list.

5. Share your knowledge

Customers want to make the right choice and will be grateful if you take the time to share your expertise. As well as offering advice when a customer comes into your store, consider running workshops and other events that allow you to share your knowledge of particular products and services. Our wardrobe and pantry organisation workshops are particularly popular with customers.

With 16 staff members and a customer base that stretches across South Australia – and to places like Mildura and Broken Hill in neighbouring states – Strutton has no regrets about moving into retail.

“We have built a strong business, have dedicated staff and loyal customers. I love doing what I’m doing and am committed to remaining in business,” he says. “We’ve certainly gone through some interesting times, but overall the journey has been a good one.

“I’m using the current situation for debt repayment, but I wouldn’t rule out a second store. It might be a challenge I’d enjoy.”