In a troubled financial environment that’s seeing well-established companies bleed revenues, a four-year-old outdoor products store in Halifax, Nova Scotia is thriving.
Magic mix
The firm’s owner attributes this success to a blend of old-school marketing and up-to-date business management tools.
While brand building using Web 2.0 tools is all the rage today, Joachim Stroink, owner of the single-location outdoor gear store has opted for a simpler, more direct approach.
Trail Shop uses no print ads, has a very simple Web site, and is not on Facebook.
The store’s strategy for community building is actually meeting people in person, shaking their hands, and demoing their products.
“Our marketing strategy is a bit different. We go to trade shows a lot we hold a festival by the lake — we’re into building a physical community as opposed to a virtual one,” says Stroink.
And the results of this approach have been great.
The 15-person store posted 15 per cent revenue growth in 2008, and despite the recession is on track for eight to nine per cent growth this year.
While marketing at Trail Shop may not be hi-tech, the running of core business operations is a different story.
To effectively link these, Trail Shop uses SAP’s Business One, a suite of apps specifically developed by the Walldorf, Germany-based SAP AG for small and mid-sized businesses (SMBs).
The software links together Trail Shop’s point-of-sale (POS) data, Web tools and online store transactions, inventory and delivery data, merchandise repair records and even trade show sales – all using the company’s laptop-based cash register.
Without Business One, Stroink said, an employee working on one aspect of a transaction would have no idea about goings on in another area of the business that could affect his or her actions.
Trail Shop previously used a POS system developed by Possum IT of Adelaide, Australia.
Stroink said the product worked well but did not enable users to view other aspects of the business.
“For example, a worker taking care of online sales would have to shut down one application to open up another that would indicate if we have inventory to fill the order.”
For a while the system worked because employees, cross-trained on one another’s tasks, eventually got used to the process.
As Trail Shop’s business grew, however, Stroink began to realize that that volume of transaction would soon become a problem. “My frustration was the previous system didn’t allow us to know where everything was.”
After checking various software products Stroink, last year, settled on SAP Business One.
For the Trail Shop owner, attractive features of Business One include affordability, and the software’s ability to link together various operations, while offering users a single view.
“The suite saves us a lot of time and from a single screen, provides us with accurate information about various areas of our business,” Stroink said.
He related how Business One’s reporting ability made it possible for Trail Shop to quickly change track and pursue a previously unrecognized business opportunity.
Sales hit the roof [racks]
By drilling down to weekly profit margins recorded by Business One, Stroink realized roof racks are among the store’s best selling products.
Using this insight gained from the report, Stroink expanded the store’s retail space — at great expense — to accommodate a larger inventory of roof racks. It was a very timely decision and Trail Shop has since been selling a lot of roof racks.
“Two years ago that sort of move would have been based entirely on gut feel and we wouldn’t have the numbers to back up the plan,” Stroink said.
“More than 75 per cent of our customers globally and well over 60 per cent in Canada are in the SME market,’ noted Conrad Mandala, vice-president, small and medium sized enterprises at SAP Canada.
He said SMBs typically think of return of investment and require easy- to-manage systems that provide a broad portfolio of services.
“Budget restrictions and a small or non-existent IT shop constrain many small companies, but these firms still have business demands that require integrated tools.”
As such, tech-based business management tools are purchased to handle: accounting and financials; sales; e-commerce; customer relationships; purchasing; inventory; and distribution.
While Business One has been very effective in enhancing Trail Shop’s operations, Stroink believes the product could still be improved.
For instance, he hopes one day SAP will extend Business One’s capabilities to enable partner firms to link to one another’s systems.
“How much simpler it would be if we could link to our supplier’s site to replenish our stock and then from the same site arrange for a product to be delivered to our customer.”