A changing tide in the retail jungle

Jan 4, 2019 | Blog, Technology | 10 comments

A comment from a local businessperson at a recent event caught my attention. It’s a warning.

“Our local businesses are competing with Amazon.”

Are they? Is any business competing with Amazon? Wal-Mart is struggling to keep up with them, because Amazon is a beast!

So, should local retailers close up shop and move on? No. But, they are going to have to offer a different value proposition. Fighting for who is going to sell consumers laundry detergent seems to be a losing one.

A changing Tide…

It was first brought to my attention that people are buying products such as laundry detergent online, by a friend who was ran ragged by e-commerce (see Amazon) this holiday season. My friend is a courier. We kind of laughed it off. Then LinkedIn sent me an email featuring this story.

Laundry detergent companies have over-packaged their products for years. The idea is to take up as much space and capture as much of our attention on the store shelf as possible. They are now developing packaging that is lighter, and more suitable for shipping. The innovation motivated by a desire to keep online retailers like Amazon happy. Smaller and lighter equals cheaper to ship.

My goal this holiday season was to gift local. I was about 95% successful. Quality products, a personal relationship and a story, is worth a lot to me. These are values that Amazon cannot compete with.

My family has been in the Salish knits business for the past 40 years. My sister and mother hand-knit super high-quality, beautiful sweaters. They use local wool, that is processed in Alberta.

They sell sweaters for $400-$500. You can buy six sweaters for that price online. The “Indian sweater” business, fed many Coast Salish families for decades leading up to the 1990’s. That was before they were replaced by a much cheaper, lighter, less scratchy, fleece product.

Designed with love, knit by hand

People buy our sweaters (and other wool products) because they are real. Custom designed with love, and knit with hands. Our customers take time to feel the quality and the warmth. They are not only buying a sweater, they are forming a relationship with our family, investing in art and writing a story.

We experienced the crash of the market. Coast Salish knitters could not compete with the rock-bottom price that the manufacturers of fleece could deliver their warmth for. So, in the 1990’s we stopped trying.

Until, we intentionally decided not to compete with them. We changed our value proposition. Our focus is on quality, local, handmade, personal contact, relationships, and love. Also, we know that the time it takes to wear out those six cheap fleece sweaters, your hand-knit sweater is just getting into its prime. Deliver that Amazon!

It’s happening! The disruption in the retail marketplace caused by online sellers is impacting small businesses and our town centres. Will we be able to compete?  What are we doing about it? Do we care?

Perhaps, we should be asking what our town centres can offer that Amazon cannot. How can we capture warmth, love, and community, package it and offer it to our friends, family and neighbours? And finally, what role should our local and provincial government’s play in addressing these challenges?

I would love to hear from you.

What do you think? Do you shop online? Why? Do you try to balance your purchasing? Let me know in the comments below.

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  1. Sue Moen

    we seldom shop on line except for eco-products local stores don’t bring in yet. I do search for local makers and save to buy one local quality item that will last. The biggest obstacle I have seen to increasing the % of local purchases is the perception (tied to instant gratification marketing syndrome) that ‘we’ can’t afford it. Like most education campaigns, this shift relies on one on one conversations and examples. I use two: for six months, I bought groceries only from big box stores, used coupons and sales flyers. Then I switched the same budget amount to seasonal and local, and organic if I could. At first, it seemed more expensive but I noticed I had more spoilage because I was buying same volume of food. Local, fresh food satisfied my body’s nutritional requirements with a lot less than cheap imports, so in the end, it cost us less and we are healthier.The second example I use are my 26 year old boots. I couldn’t get them made locally, but I saved and bought from a locally owned business. I have maintained them for about $30 every five years and wear them almost daily for work- so waiting until I could afford quality has cost me much less over time. People need these kind of examples, and support to make these choices.

  2. Candice Wallace

    Hi Adam. I try to buy local as much as possible. Made in Canada and BC is important to me. And quality counts for me. We gave our daughter a Hudson’s Bay blanket for Christmas. It will last her a lifetime if she looks after it. However, as a delivery agent for Canada Post I see time and time again that cost is the bottom line for many consumers. I’ve seen with my own eyes the detergent, cleaners, and trendy clothing that can be bought through Amazon. It saddens me and I think it’s a symptom of something bigger going on in the world economy.

  3. Sue Sutton

    Good article. As someone just on the cusp of making a living as an artisan (I make jewelry), I don’t have much spending power, but I do my best to buy local and handmade. Yesterday I splurged and bought an aquarium in the lovely little petshop Sidney, it was a fun experience and I look forward to an ongoing relationship with this locally owned business. It’s partly about supporting local folks (though of course everyone needs to make a living), but in getting to know the people who sell you things or fix things or make things, you become part of the community. It is an investment in belonging, which is so deeply important to every one of us.

  4. G Owen

    People come to our store for the knowledge and advise them some order online after we have pointed them to the correct choice Bless their Little hearts

  5. John Glover

    Adam: Right on! Some years ago (2001) I met a Cowichan woman in Thrifty’s in Duncan who was advertising Cowichan sweaters. We talked for a long time and I asked her to create a sweater for my wife. She asked me some questions about my wife’s tastes and then promised to create and have that sweater available before Christmas. I forget what it cost – less than what you quoted but I did not care. That woman, that artist, delivered a sweater that my wife cherishes to this day (2018-19). I surely relate to that value proposition! Big time! Yes, we shop at Amazon, for kindle books that we can read offline and on long trips.. We also had to shop at Amazon for a sleep tonic that became unavailable in a retail setting. We purposefully shop local unless there is a compelling reason to do otherwise and we go out of our way to reward local loyalty such as using Coop for gas and anything auto related. Hope that this comment underscores your blog theme and we look forward to other articles like the one regarding our recent storm. Cheers, JohnG

  6. April Tomiye

    I do not shop on-line because I do not want our local stores to disappear. Also, as you mentioned regarding the Indian Sweaters, I choose quality over quantity. I like my clothes to last years, not only a season. I also choose colours that suit me, not the seasonal trends needed to be “in fashion.” I avoid marketing practices designed for the sole purpose of manipulating people to spend more than necessary. For instance, groceries offered at a slightly lower price if more is purchased and other stores offering buy one at full price to buy the second at half price. I do not buy items sold in this manner and do not frequent the stores that operate this way.
    The constant barrage of sales gimmicks proclaiming 50%, 60%, 70%, etc, off regular price is an insult to the intelligence of their customers.
    I suggest local businesses have a better chance of surviving and thriving by selling with integrity.

  7. Dave Froman

    I’d like to offer a different view of a retail problem. The phrase “There’s an app for that”? Has now replaced the need of over 3 million dollars worth of goods and services that we had to pay for 20 years ago. Go take a stroll through the appstore and see how many things you used to have in one form or another that is now digitized. 3D printing while still in its infancy is doubling its performance at half the cost every 2 years, just like Moore’s law. It is already capable of producing a seemingly endless array of household goods, crafts and it is conceivable in the not too distant future even clothing. Nike is already 3D printing custom shoes for athletes btw.

    A little history for you. 99% of ALL the businesses that existed during the 1st industrial era failed to successfully navigate into the 2nd industrial economy. We are now entering that transitional period again as we see the digital autonomous era mature. You cannot solve the problems of the future by looking to the past any longer. We no longer live in a linear world.

    • Adam Olsen

      Did we ever?

      • Dave Froman

        Yes actually we did. Back before the dawn of the industrial revolution. Then we took a blip up for 200 years but the changes were still deceivingly linear. That all ended with the advent of the personal general purpose computer. That is why General purpose robotics is a BIG issue Adam. Its now reaching the point where anyone can afford them and you do not need a programmer or technician to operate one. I hope you took the time to watch that video I sent to your FB page the other day in msgr. Those exponential curves that are described in it are going to impact every facet of our society over the next 10-15 years. Ive followed the model for about 8 years. Its actually proving to be conservative more times than not.

  8. Kara Middleton

    I recently read about this influence of online shopping, upon the design of packaging, in the Business section of the Times Colonist. I thought: we could have legislation and govt oversight about the packaging problem. This does not have to be only a market-driven initiative.

    I shop online only when there is no alternative. Disturbing revelations about Amazon, and Besos, are one reason. Also, the increasing incidences of security breaches online. But most of all, my reason is that I want to support local business and local products. It is about a sustainability, quality and community. “Slow shopping.”

    But shopping online and having things delivered makes a lot of sense sometimes. Grocery home delivery is an example. I remember being a weekly customer of a local organic produce company 20 years ago in Vancouver – when it was all done by telephone and by ticking choices on a list tucked into the box. I see Spuds trucks on the roads, and hope that such businesses are growing. Online grocery shopping is a way of life in places like London, England – and a huge help to people like my stepson and his family, who live extremely busy and complicated lives there. There is also a reduction of carbon footprint (especially when the delivery vehicle is electric) and traffic congestion. So: I think that online retail at the local level is a good direction.

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