Small Scale For Big Business

On February 13, 2009. By Fran, under Industry News.

A very small flicker at the end of the current economic slump tunnel might just lead some business to higher ground. OfficeMax, looking to lower location rents and warehouse costs with a new concept called Ink Paper Scissors. Three new Ink Paper Scissor locations, smaller in scale to OfficeMax’s warehouse design, contain about two thousand of the chains most popular products for quick get in and go shopping.

“Everyone is looking at smaller footprints now; it’s a big theme right now because traffic is down so dramatically that they can’t afford the inventory and labor for a full store.”-Industry Insider

Industries like fast food have always taken the small scale, convenience style objective by maximizing kiosk locations in malls across the country. Starbucks and Seattle Coffee have been introduced in place like bookstores, airports and hotels to increase their presence in high traffic areas where a larger restaurant would be cost prohibitive.

Applying this concept to other forms of retail could be on the horizon. Staples, Target and other business have opted for the “dollar menu” creating popular products at ninety-nine cents to lure shoppers into quick buy sales. Seasonal items such as holiday novelties, children’s toys and school supplies have done extremely well as this new concept takes hold.

The stigma of dollar store shopping has seen a tremendous upswing in sales over the last year. Besides getting more business from their regular customers, they are also seeing in influx of new customers.

“It’s not where you shop, it’s what you get. It’s the value of what you’re paying for, if it’s the same thing you paying for at Wal-Mart, you might as well as come here and get it at a better deal.”

Chains like Dollar General, Dollar Tree, and Family Dollar are offering popular name products as well as continually working with large manufactures to create special discount brands like you would find in most supermarkets.

Dollar shops have come a very long way from when they started. You can find dozens of popular brands that are not closeouts or damages, but created for the discount market.

Suppliers need to prepare for these trends by refining their logistics process, adjusting for smaller shipments to more locations. The ultimate form of specialization comes in the form of direct to consumer sales with goods being shipped by the vendor directory to the consumer, labeled as if it had come from the retailer. These specialized logistics will be required to compete in this new marketplace.

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