Building
An Information
Foundation for Success
Building a customer data base is an ingenious
pyramid scheme that contributes to survival in hard times and leads to success
in good ones. Here’s a profile of one such data-base builder called the
Edge and a happy, born-again user.
By Tony Seideman, Marketing
& Media Consultant
Stephen Barnes knows that information is more than just data. For him information
is time, money and profits. It’s a kind of alchemy, with computers turning
bits and bytes into enough profits for him to be opening a new store in the teeth
of the worst economy since the great depression.
As an independent jeweler who has been in the business all his life, Barnes
knows that every penny counts in a small business. Barnes Jewelry was founded
by his parents as a three-person operation in 1980 operating out of a 1,000 square-foot
storefront. Today the business has 11 employees and a 6,700 square foot facility.
A new outlet, Barnes & Jernigan Jewelers, will be opening in the next few
months.
Without effective use of information technology, Barnes swears, none of this
would have happened. “It’s one of the main reasons why our business
has been able to prosper,” he says. Barnes purchased Abbott & Shapiro
LLC’s The Edge system, and then signed on for ongoing support. Then he took
weeks of courses at The Edge Retail Academy.
“It’s the best money I’ve ever spent,” Barnes says.
“From a business perspective, it’s helped us make the right decisions,”
something that’s especially important in a tough economy where there is
no room for mistakes.
A Drop-Out from the School of Hard Knocks
Barnes learned the importance of automation the hard way. He'd resisted computerizing
his store for years. Everything was done on paper. Receipts. Inventory. Customer
information. To do a full inventory he had to shut down his store for more than
a week. Figuring out which items were selling best was more a matter of guesswork
than of actually knowing what was really moving off the shelves.
In staying with paper Barnes was like untold numbers of other jewelers. But
he had a sense that something was missing, that there were possibilities he wasn't
taking advantage of, that instead of moving ahead, he was falling farther and
farther behind his local competitors who had taken on the technology he had resisted.
Barnes took the plunge. He went to Abbott Jewelry Systems and invested in
automated technology whose possibilities he is still working to understand. What
Barnes does comprehend is that his business is now different than ever before.
It’s crucial to recognize that automation extends into every aspect
of a store’s business—and, if it doesn’t, it should. “We
use The Edge for many different operations. We use it to track custom work within
our repair department. We use it to track what kind of volume and sales we’re
doing in our repair department. We use it for our appraisal services,” Barnes
says. On the financial side, The Edge integrates so well with Quickbooks it’s
as if the system has a built-in accounting module.
The Joys of Automation
Making the transition from paper to digital didn’t come easy and still takes
a lot of hard work. One thing that made the task infinitely easier was the fact
that the software had been designed with jewelry stores in mind and usability
a priority.
The aches and pains of transition are certainly paying off. Basic actions that
used to take significant amounts of time and energy are now handled automatically.
What Barnes is finding is that automation is not just a matter of being more productive.
It's a step into a new world. Technology has enabled him to handle the basics
-- and by dealing with these he's laid the foundation for dealing with everything
else more creatively and aggressively than ever before.
Without handling the basics, though, moving into more advanced applications
would be almost impossible. Though marketing, social networking and web sites
are sexy, Barnes feels the most important things he’s gotten by using The
Edge are visibility, control, connections, efficiency and professionalism.
Visibility. Computers are a lens for information.
They enable businesses to see what’s happening with their products on a
moment-by-moment basis—and to act on those findings quickly and effectively.
Before computers, taking inventory was an annual event. Things are totally different
now. “We have daily reports that give us up to the minute information on
what is in the inventory,” Barnes says.
Control. Knowledge applied is power. Collecting
information on the state of business in his store is just a start. The next step
is turning that data into effective action. That’s where the training and
free tutorials supplied by Abbott & Shapiro come in handy. Powerful software
enables users to see patterns and act on them; one phrase for this is “inventory
mining,” another is “data mining.” “We can track things
and bring in new inventory if it’s selling well,” Barnes says. Just
as important, if a product line is proving a dud, the store can skip it and move
on to something else.
Connections. One of the great strengths of independent
retailers is their ability to build lasting and intimate relationships with customers.
Effective use of information systems can bring these relationships to an entirely
new level. Stores that work hard to create databases can collect information on
everything from anniversaries and birthdays to graduations and confirmations.
Each piece of data is an opportunity to reinforce a relationship and make a sale.
And with a system like The Edge, searching this data is a quick and easy process,
and so is updating it, Barnes says.
Efficiency. Keeping track of things on paper is
costly both in terms of time and money. Labor savings alone from implementing
automated systems meant that The Edge paid for itself in a matter of months. Perhaps
the best example is the inventory process. No store likes to shut its doors when
customers might come calling. But that’s what Barnes had to do when he did
inventory in a paper world. “We would do physical inventory once a year
and we would have to close our store for a week. Since it was all handwritten,
we had to get our hands on every in the store. Since we’ve converted to
The Edge, it takes us four hours to do what used to take us a week.”
Professionalism. Customers notice when stores make
their lives easier. They’re used to dealing with technology, and can tell
when a store is using old-fashioned, outdated systems. The change is both subtle
and vital. “It’s one of the most important benefits of The Edge—and
by that I mean being able to present a professional image to our customers our
clients our in terms of our sales team and our business approach,” Barnes
says. Part of that professionalism involves the actual use of images. The Edge
is capable of capturing pictures as well as data, so when customers come in, the
store captures an image of the item as well as a description. “We take a
picture of what we’ve got. That’s nice and professional and we get
comments on that.”
The Pains of Progress
Change and resistance often go hand in hand. But the benefits from The Edge were
so clear that even the most recalcitrant employees eventually got on board. “I
had a lot of older employees that did not like change and did not want to embrace
the change, but once they saw what the change was doing for the store they turned
around. It’s something we adapted to, and we’re glad we made the change,”
Barnes says.
Leadership made a big difference, Barnes says. “Everything comes from
the top. With me being the owner and the manager, when they saw my excitement
with the program it energized them.” People tend to think of computerization
as a dry subject; “We did it with excitement,” Barnes says, and that
made a big difference in terms of getting people to put in the time and energy
needed to use the system well.
Another aspect of his involvement was getting trained in how to use The Edge’s
capabilities. “When we first installed the software, we did a two-day training
session. Since then, I’ve done management seminars to better understand
how to use the software from a management standpoint. I’ve probably been
to four weeks of classes with The Edge, and it’s been very beneficial.”
Still, with computers, nothing beats real world experience. “My biggest
thing is that people have to really get into the software. You can’t expect
it to do everything for you. You have to click into it and see what it does. Sitting
in a seminar or a class is not going to give you the kind of connection you need.
What will is getting in there and digging in and pushing on every button and seeing
what it does.”
Establishing new policies and procedures is vital as well. The Edge has bar
code scanning capabilities fully integrated into its operations. That means every
item on the store’s shelves needs to be tagged and scanned, and that new
items need to get tagged as well.
Getting to Know Your Customer—In Person and On Paper
Information about items isn’t the only important data the store collects.
“We gather as much information from our clients as they will allow. We ask
for birthdays, anniversaries, e-mail addresses and things of that import,”
Barnes says. To encourage people to provide the data, the store has a weekly drawing.
In order to participate, entrants have to give their name, address, phone numbers
and other details.
All this information is being constantly put to use. One of the most exciting
tools The Edge has available is an on-demand postcard program that allows stores
to send personalized, glossy, high-quality postcards to everything from just one
customer at a time to the store’s entire customer base.
“We use The Edge postcard program where we want to get weekly postcards
to birthday and anniversary clients. We send out a postcard wishing them a happy
birthday; and asking them to use it. We send customers thank you cards for trusting
us with their jewelry and allowing us to repair it,” Barnes says.
E-mail capabilities are fully integrated into The Edge, and they’ve
proven an incredibly affordable, effective way to boost business. “We have
e-mailed our customers about several promotional events we’ve been doing.
One recent project sent e-mails to 500 customers. “We get a 10% response
to that e-mail, which is great, especially for e-mail, which doesn’t cost
you a dime.”
Few people regard software as something pleasant to deal with. But another
huge asset for The Edge has been a sense that its users are part of a real community,
and that company leaders Dick Abbott and Joe Shapiro take the feedback from their
customers directly to heart.
“The other thing I love about The Edge is Dick and Joe’s willingness
to hear from the clients about things we think can be of benefit to us as jewelers
and business owners. They take our suggestions and actually implement them into
the program, and that has been a tremendous help for all of us,” Barnes
says.
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