Choosing Your Firm's Future: .com or .comatose

Choosing Your Firm's Future: .com or .comatose
by: Stephen Vlachos, CKD, CBD

How do we weather the elements? Is there a plan in place? Should we open an umbrella or should we head for higher ground? Yes, it's definitely decision time.

One of my favorite parts about participating in the Business Owners' Symposiums and K&BDN- and NKBA-sponsored Managing For Profit seminars is that we get to ask the group of attendees where they think our industry is heading. Their opinions about the future are always varied. One of the most common beliefs, however, is that there will always be a place for the small, traditional dealer, as long as that dealer offers great design and great service. 

This common prognostication may, in fact, be true. But I doubt it. 

I think we should use our advantage of being able to look at what has happened in other industries. Take drugstores, for instance. A few years ago, almost every neighborhood had a corner pharmacy. I can just picture a group of pharmacists sitting around at a seminar six or seven years ago, telling each other that there would always be place for their businesses, as long as they offered great customer service. As we know now, they were kidding themselves, probably just telling each other what they wanted to hear. 

Is our industry doing the same thing? Looking further at pharmacists, I'll bet that six or seven years ago, they perceived the threat to their livelihood to be superstores like Rite-Aid or Walgreens. But who, in fact, became the world's leading drugstore? WalMart! They probably had no idea that WalMart was even entering the pharmacy business. Even more amazing, as soon as WalMart made it to the top of the heap, its pharmaceutical sales started getting clobbered. Who could beat up WalMart? Drugstore .com.

The whole .com thing is just incredible. Only a few years ago, local bookstores were faced with the emergence of superstores like Borders and Barnes & Noble. Not unlike many kitchen dealers and druggists, I am sure that a goodly number of booksellers decided that if they just offered great service, they would do just fine. 

Could they possibly have imagined that the bigger threat would be Amazon.com? Probably not. How long did it take Amazon.com to become the world's largest bookstore? Two years! 

Up until then, we all would have considered the book selling business to be a mature industry. Yet it was completely revolutionized in only 24 months. Even more stunning, when Amazon.com decided to go into the music business, how long did it take for it to become the world's largest music store? Seven days! That's right, seven days from nowhere to the top. 

How does that apply to those of us in the kitchen and bath industry? Let's assume that you're a kitchen dealership that offers absolutely great service. Your showroom is beautiful. Your staff is exceptionally well trained. Your customers love you. 

But let's say that a previous, satisfied customer has a leaky faucet. The customer knows that it has to be replaced. Both the husband and wife work all day. When are they going to be able to visit your wonderful showroom? Their evenings are filled with preparing dinner and helping kids with homework. Can they live with the faucet until they're finally able to coordinate their schedule with your showroom hours? Maybe. Do they have any other option? Absolutely! 

In a matter of minutes, they can visit faucet.com. They can shop while you're home in bed. The selection is huge. The pricing is good. The faucet can arrive on their doorstep within 48 hours. Do these customers still love you? Sure they do. Will they think of you first when they next need to go shopping? Hint: no.

You may think ,"This doesn't apply to me. We're in the design business. No one can design for a customer over the Internet." Don't think so? Well, think again. Every day, thousands of people communicate via e-mail. They make travel reservations on the 'Net. They pay bills online. They can certainly, then, transmit kitchen and bath measurements this way.