Great Retailers are the Key to a Great Industry
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Great Retailers are the Key to a Great Industry: In this episode, Fred Clements, former executive director of the NBDA, interviews Dan Mann, retail expert and President and CEO of the Mann Group. Fred and Dann discuss best practices for making great retailers and how retail affects the industry as a whole.
PRESIDENT AND CEO: DAN MANN
Open your trusty dictionary and flip to “leadership,” and you’ll likely find Dan’s face looking back. The Mann himself thrives in the sticky straits of leadership, in both our own business and in the more than 2,000 others he’s worked with since founding The Mann Group in 2002. Dan was given the gift of gab, and it’s his unparalleled communication skills that make him a trusted teacher across dozens of industries. The proficient public speaker, published author, specialty retail sage, and leadership liaison has a host of hobbies that fill his spare time outside the proverbial office, including mountain biking, movies, and music.
FOUNDER AND CEO FOR 15 YEARS
27 YEARS RETAIL EXPERIENCE
47 YEARS OF TRAINING
Support the show (https://nbda.com/articles/donation-form-pg511.htm#!form/Donate)
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Dan Mann & Fred Clements – Final
Thu, 8/20 11:48AM • 54:09
SUMMARY KEYWORDS
industry, bike, people, retail, retailers, brand, customer, metrics, bicycle, hire, store, Fred, owner, dan, create, sales, skateboarding, book, sport, bike shop
SPEAKERS
Fred Clements, Rod Judd, Chad Pickard, Dan Mann, Kent Cranford
Rod Judd 00:10
You are listening to bicycle retail radio, brought to you by the National Bicycle Dealers Association.
Fred Clements 00:17
Welcome to this edition of the NVDA bicycle retail Radio Podcast. I am Fred Clements and I’m here with retail expert Dan Mann. Hi, Dan.
Dan Mann 00:29
Good morning. How are you doing? Right?
Fred Clements 00:31
Yeah, I’m doing fine. So if I didn’t give some background on myself, Dan threatened to do so on my behalf. So I’m taking this opportunity to say, I am Fred Clements. My background in the bike industry started in 1988. As an editor for the now-departed cyclist magazine. I spent the 28 years with the National Bicycle Dealers Association as executive director and then vice president and then six months with Interbike preparing for the 2017 trade show and I attended the 2018 event as a consultant with efficient Velo tools. My friend Brett Fleming, and I first met Dan man, I think Dan, it was in 2004 when you came in to help the NBA with strategic planning and goal setting and vision mission, and that went great and you worked with NBDA on that for a number of years and then on specific programs, you basically founded the NBDA profitability project, P2 program, since then your company has grown a lot, where you’re doing retail consulting in many industries. I’ve noted Of course bicycle but outdoor running the apparel industry, and others, I’m sure that you can bring up as part of your background, but you’ve worked with a number of bicycle industry suppliers at a high level and retailers as well. And so welcome Dan.
Dan Mann 01:57
My pleasure and Fred and when you think about it, that means we’ve worked together extensively for 15 years back with the National Bicycle Dealers Association, in ’04 your memories correct. We started in Nashville for the first-ever strategic planning session that I was involved with. And you and I’ve worked for pretty hand in hand for many years since you, in fact, the Mann Group is 17 years old, and even today, the National Bicycle Dealers Association is our number one all-time client in terms of our work our time together days we’ve spent together so we have a great partnership.
Fred Clements 02:34
I would agree with that. So I’m really curious about how your observations in these various industries, you know, any comments you might have kind of narrowly focused on the bicycle industry and you’ve broadened out into numerous industries. Have you had any feelings about active retailers faring during these times of clear disruption?
Dan Mann 02:58
Yeah, so we have focused The Mann Group works with the bike, the run industry, the outdoor industry, fly fishing. We do work in apparel and some fashion businesses we work in action sports like ski and snowboard and skateboard. And I can say across the board that all of these retailers are facing many of the same pain, growing pains, and just evolving pains that the especially the retail world is customers have a lot of options. And, and the fact that customers have a lot of options means they have a lot of power and control over how they buy and, and engage with, with businesses like ours. So if I’m getting bad, a bad experience, today’s consumer doesn’t feel they have no option. They know they have options. In fact, you can grab a phone and immediately make a purchase inside the business of a retailer that you don’t like. And those options are increasingly It means that more and more of these retailers are going to fail. More and more of these retailers are going to suffer unless they evolve and emerge into something different. And if they’re not responsive to the customer experience, that every single customer is looking for that unique, one of a kind experience that every customer wants, that retailer that can’t provide that is going to have trouble.
Fred Clements 04:27
So, I know you’ve gained much of the Mann Group’s work on training staff in retailers. And I guess that would play well into that comment about focusing on the customer experience. What do you find are the keys to providing that experience that the customers are looking for today?
Dan Mann 04:46
Yeah, it doesn’t take much of a Google search to look into retail and land on the word customer experience. And the work you know, the concept of customer experience has become crucial both in an online Line experience as well as inside of a brick and mortar experience. The challenge today is everybody wants their own experience. So we say that, that it’s up to the retailer to offer an experience that that customer standing right in front of them wants and one of a kind experience. And that is just becoming increasingly challenged. The word retail comes actually from the root word, I think it may be Italian, of tailored. And so the retail world evolves from this idea of tailored and that tailored language is exactly what you can picture, that custom fit, unique garment built just for me. And you know, specialty retail still has that as its ideology. Mass retail doesn’t necessarily, but if we believe that everybody walking into our bike store is looking to pursue the sport in the same way that we do, and we try to force that customer into that shopping experience in the way we think we would like it, then we’re going to immediately have some conflict. Customers approach us, with caution customers approach us with a few fear customers, some customers approach us with a lot of research. They’re prepared. And so what it calls for Fred to answer your question is that it calls for a tremendous amount of preparedness. And it calls for a tremendous amount of, I think, building a great team, in terms of the sales force in terms of the folks working on the sales floor, so that the owner creates a team of people who understand this are committed to delivering it, and then are prepared to do so. So that preparation means number one, we understand the product. And secondly, it means that we are flexible and adaptable to the customer that’s walking in the door. And so, you know, those of us in the bike industry, we were very opinionated much and you know, the mountain bikers tend to look down on the road, cyclists. Road cyclists tend to look down on entry-level riders. And I don’t know that anybody has a handle on the bike rider. But bottom line is, we all have these strong opinions and all that’s great, we’re passionate, but when it when that, you know, evolves into or infringes upon the customer’s shopping experience, and that Customer Picks up on any sense of judgment or any sense of dismissiveness where you’re going to be in pain because that customer has the power to go out and communicate that to their friends and family. Know the old days used to be that a customer who wasn’t happy, could communicate that to 10 people would communicate that to 10 people saying don’t go to that store. Well, these days between social media and Yelp, and a variety of other avenues. A customer who’s unhappy with you can raise a lot of negative opinion of You through their resources of doing that. And customers will do that. They’ll take this sort of bad experience very personally. And we can’t risk that. So there’s even more online than there ever has been to do this better. So I think I think that’s why it matters. And that’s what it takes.
Fred Clements 08:17
Yeah, is there you know, with your experience in several industries, I, I realized from my years in the industry, that there’s a lot that goes into retailing, a lot of different areas to focus on where you really need to be good. Is it to you in your mind, is there a most important thing that a successful retailer needs to focus on? Or is it six most important things?
Dan Mann 08:40
Yeah, that’s a terrific question. There is so much at risk right now for bike retail, and I’m going to just rattle off a handful of things that I think are that I’m seeing as being very important. Maybe I’ll come back to prioritizing them. First and foremost, right now, I think The specialty bike retailer is challenged with inventory planning. As margins are shrinking and as competition arises and as there’s a direct to consumer opportunity, having the right product in the right sizes in the right colors at the right price at the right time is getting more and more difficult. And the days of having your vendor tell you what you needed to have on your sales floor and ordering it for you. Those days are gone. You as a retailer must understand what’s coming in at the right time at the right price and sell it at the best possible margin you can get. This cannot be accidental. When I’ve got an internet full of options, and I can choose any size and color and have it available in my front door in two or three days. The retailer in the specialty bike industry can’t do that. We don’t have 100,000 square foot stores most Worth 3000 square foot 5000 square foot 10 15,000 square foot stores and with a compacted selling season of maybe four or five or six months based on seasonality of our business. So we’ve got to have a curated selection. And it’s got to be exactly right for the market. And based on historical data, it’s got to also be we got to have it in the right quantities. So it’s valuable and sellable and desirable for the customer at the time when that’s needed. So that requires some healthy research that requires some significant planning. And it requires that we have an educated retailer who’s doing the right thing. So So inventory planning right now is going to cause a lot of retailers pain if they don’t get it right. You know, so this one’s a big one. Additionally to that the retailers today have got to be focused on having the right Salesforce the right team, you know, the bike industry values service and being great with your hands great as a mechanic and understanding problem solving and executing this job is never going to go away and it’s never been more important. So so the service side of our business is absolutely crucial This is zero there’s gonna be zero failure no zero tolerance for failure in service but what’s often not valued both in the service side of my business and on the sales floor is quality salesmanship the selling of the product, the communication of product knowledge and features and benefits and then building rapport and building trust so that I can put my product knowledge together with this customer’s needs and do it profitably has got to become important. And, you know, I am an advocate for quality salesmanship on the sales floor. Now, where this is going to take us Next, Fred, in terms of the big issues, it brings us to the third issue. I’ve started with inventory and I’ve talked about a Salesforce. The third issue and this one is coming for us. And it is a big issue. And that is staff compensation, we must address the capacity to hire and keep quality people. Now, every employee who is a bike store listening to this is probably high fiving and applauding that, that I just said that, and every owner who’s responsible for profitability is, is rolling their eyes and holding their breath. So let me be clear, I am talking about a win-win, not just giving more money to staff, we must address compensation as it must become a win-win. And that Win-Win means that we maintain profitability at the retailer level, but we also offer opportunities to our sales associates and our service folks that are good at it now I’m headed toward a conversation around incentive-based and performance-based compensation. So we say, commission an awful lot. And what I’m talking about is not really straight comp commission compensation. I’m talking about giving people the opportunity to perform, see results, and benefit as a result of their contribution, there is a way for that to mathematically work out to the benefit of the retainer. Now, this is a whole different conversation thread than we can have on this podcast. But I can tell you, this is a big issue facing specialty bike retail, effective compensation strategies that become a win-win for both the owner of the business and the staff. So to summarize, then, inventory planning is a priority. Hiring and maintaining and keeping the right staff who understand and value customer experience and can sell it and then finally, the compensation needs that that help us then you know, Match both of those together. So those are the big three as I see it, and there’s plenty more I could rattle off, but those come to mind right off the top my head.
Fred Clements 14:08
I remember when we started working together, Dan, one of the first seminars you did for the NBDA at Interbike was on hiring and employment issues. At that point, you kind of blew me away with your notion hire a personality doesn’t hire for expertise. Because personality, you can always teach the expertise, the personality, you can’t change through these years of doing it. Are you still on that? That wavelength in terms of hiring,
Dan Mann 14:37
I am absolutely still on that wavelength and, and actually, I’ll divide into three areas that if you could imagine a Venn diagram overlapping each other, each of them the each of these three aspects must be considered number one, you must hire for the people skills. To do the job. You must have you must hire someone who can Capable of engaging, being curious, listening works well on a team is able to engage and build rapport. Secondly, you must hire the technical skills to do the job. So you do have to hire people in service and bike building and other elements of the job in bookkeeping, all the elements of that have the technical skills to do the job. And then thirdly, with people skills and technical skills, you also must hire a history of commitment, people who understand the ability to commit. And so while people skills and personality are crucial, and the reason why I made a point about that in that seminar, the thread is the bike industry is notorious for hiring just the technical skills without the people skills and the ability to commit. So it takes all three, it takes the people skills, the technical skills, and the ability to commit to making a great employee. So you know what, I think the probably the biggest thing mistake we make in hiring in the bike industry is we hire people who previously worked in the bike industry. So someone presents himself at your front door, say you’re looking for a job. Okay. Tell me about yourself. Well, I used to work for XYZ bike shop in XYZ town. Well, how long did you work there? Five years. Okay, good. Well, you must be good. So come to work for me. Put this person on the sales floor, but this person in the service department, but no training, no set of expectations, no understanding of our approach, and find out six months later or six years later, we’ve made a mistake. That’s because we hire without setting expectations we hire because someone worked at a different shop somewhere else and what happens when you do that is you’ve brought someone in and put them on your sales floor. And this is someone who another person trained another person set the expectations and you can’t figure out why we’re not getting the results we want. Well, because you didn’t take the time to create that. To training, to create the expectations, and to create the opportunities. I’ll tell you a quick story about that. Fred and that is years ago in my previous life before I started the mango, I ran a company called back rack It was a men’s clothing company 75 stores, and we sold men soups and that sort of thing. And of course, our big competitor at that time back in the 90s was Men’s Warehouse. Joseph A banks, those kinds of companies. And over the years of, of trying to hire people from Men’s Warehouse. To come into our business, we found that the approach and the methodology that was trained to those sales associates was the opposite of what we believed was our customer experience, and eventually came to the point that we said, you cannot hire someone who has previous men’s clothing experience. Now that seems like a strong statement. But we would rather hire someone with the capacity to engage with people with great people skills. train them on technical skills. Because we found that if we have someone who had a preconceived idea about this experience, and had been trained elsewhere, it was virtually impossible for us to change their opinion or to change their habits. So I’m not saying that’s exactly true in the bike industry. I’m just saying that for those of us in the bike, when we make the mistake of hiring, without setting expectations, hiring because they work somewhere else previously, without providing our own training, we may be setting them and us up for failure. So yes, to answer your question, and along the way, yeah, I still believe we’ve got to bring those people skills into equal importance with the technical skills to be effective.
Fred Clements 18:40
You know, is that up you know, I think a lot of bike retailers and I know myself you know, I I love the equipment that stuff really gets me pumped up when Shimano comes out with a new groupo or something, you know, I’m, I’m into it. And I think a lot of bike shops are too. Is that something? Is that a problem? That not problem really. But did the other industries you work with have that similar dynamic of oh my gosh, we just love the running shoes or the outdoor equipment to the detriment of our ability to sell to the average Joe.
Dan Mann 19:15
Yeah, I see this a lot in the fly fishing industry. These folks, you know, the better best part of their day is to be on the water fishing. And these guys are you know, they’re passionate about it, they’re on the water every day all that’s good, but in many ways that end up not being great retail if they’re not careful, they don’t focus on what they’re actually doing. I think what we’re looking for is that blend of passion for the sport, combined with the passion to bring others into the sport. That that that rare combination, you know, passion for the sport is a back to fly fishing. You know, the problem fly fishing is facing today is that there’s not there’s less and less water access, where healthy streams unhealthy fishing is taking place and too many people on the streams and too many people having access to that to those waterways is actually damaging the waterways and causing the problem. So there are people that love fishing that is almost protective of those resources and don’t want to bring new folks and are very concerned about the novice fisherman who gets on the water and then doesn’t follow the rules and guidelines of conservation and, and so it’s a kind of a counter-intuitive nature of that. But maybe there’s a better example and that example that would give you would be a brand we work with called vamps. And I’m sure you’ve heard of vans, the skateboard shoe, it’s a large retailer four or 500 stores. And that that that brand started out in skateboarding, in snowboarding, action sports, but primarily a skateboarding brand. And that started sort of in Southern California as a legitimate authentic brand. skateboarding? Well, if you look at the stats, skateboarding is in serious decline. Skateboarding is losing enthusiasts who are actually participating the sport daily, practically it’s dropping by double digits in terms of people participating in the skateboard. vans, on the other hand, has a brand that is the fastest growing brand in the Vf portfolio they’re outperforming north face. They’re outperforming table. They’re outperforming Smartwool. All the brands inside that space. vans is the most profitable and largest and fastest-growing. Well, they have people who are enthused about the concept the idea comes you know, enthused about the brand has is exploding. So, I’m not I don’t necessarily want that same equation for the bike. But I want to point out that passion for the activity is the core, but a passion for the retail of it. Passion for the profitability of its passion for the expansion of the pursuit that has to be equal to it, I think to take us to the future.
Fred Clements 22:10
Hmm. Yeah. makes sense to me. You know, is there I don’t know if this is unique. So I’ll just ask you that our industry bike industry seems to be moving towards more single brand or one brand dominated stores and I know the brands, many of them push that. But there are still a lot of them out there retail operations that carry multiple brands in and balance it and pick and choose. Is that something that is is an issue in these other industries? Or is it you know, do you have any view about the single-brand focus versus more a more diverse brand representation?
Dan Mann 22:50
Yeah, I think it’s I think all of those approaches can be effective. I don’t think anyone is better than the other. You look in the outdoor space. There are Patagonia stores throughout The country and almost every other brand north face has got their own stores but they also sell their product in other specialty retailers where their product lines up alongside others. So I think it can work across the board. And I think that the secret to all of this is a unique local and culturally strong authentic retail experience. And so whether or not I’ve got a brand on the top of the name of my store and I’m representing only one product or whether I’m Dan’s bike shop and I carry a variety of different brands, that’s, I think that just putting the brand upon the on the front of your store does not guarantee you success and I could mention a variety of examples that could prove my point here within the specialty bike industry just because you’re you have a famous brand above your door does not guarantee success. Nor does it guarantee success to call it Dan’s bike shop and have it all the brains what is what’s going to happen is the experience That happens inside those four walls. That experience is what people are coming back for that experience is what customers are looking for. And I think that that the better job we can do of executing that and delivering that consistently, then we build something that’s memorable, then we build something that people will actually line up for. So I think that’s true in the restaurant industry. I think it’s true in the hospitality industry across the board. It is certainly true in bikes, sadly, and this has always been the case for it. People will if they come into one of our stores, and they have a bad experience. Unfortunately, they don’t just necessarily get upset with us as the shop owner. They also can get upset with the entire sport. And that’s where that’s the risk we face. The new or the curious spike shopper who comes into our store and has a bad experience doesn’t get weighed down doesn’t get connected with doesn’t feel welcomed, they don’t just get upset with the store or the brand or the name of the company. They get upset with cyclists in cycling. And that’s why it’s why there’s just too much at risk here. And that’s why we have to take that point of view. So, ultimately, I don’t think it’s a question of the approach to the selling in terms of whether or not a curious variety of brands or whether I carry one brand, I think it still is down to that one on one connection with the customer that wins today.
Fred Clements 25:28
Yeah, I had a dealer some years ago, say, you know, I don’t focus too much on the brands in my store, because I could sell anything. You know, I’m the connection with the consumer, if I believe in it, I can sell it and I thought that was a pretty interesting, so do you still I know part of your general managers training your man University included personality profiling, and this is part of what we previously discussed, I guess you know, hire for personality but is that is it practical, for At a bike shop to try to personality profile prospective employees and try to match up to their personalities with the job description.
Dan Mann 26:11
Well, yes, I obviously believe in that work because we do a lot of that work. So to be specific, we use something called the disc assessment in the DI SMC, Stanford drive, influence steadiness, and compliance. And they represent the four primary styles of making decisions and the four primary styles of communication. And all of us have various strengths. Let’s just look at the D and the C who sit in opposites in opposition to each other. The D is about drive and passion and pursuing goals. And the C is about data and analytics and stats and math. One is very subjective one is very objective. One is very emotional one is very unemotional. So it’s really less about trying to sort this and pick it and sort of predicted. And it’s more about an awareness of your team dynamic. And it’s more of an awareness that the tendency for us in the bike industry is to hire folks that sound and look and feel just like us. People that that, that we get us to, you know, the people that have a shared passion, that’s certainly safe and comfortable that we all talk the same way think the same way have the same opinions have the same politics. And while all that’s well and good, it does not create a welcoming, well-rounded environment. And so I think the strategy for us is to better understand communication styles, better understand decision making styles, and then be sure that in our hiring, that we’re not creating what I would call blind spots where I’ll just give you in my own world, Fred, the drive, part of communication, I have that in spades. I have no trouble with that. The influence side, that’s, again, I’m very good at that. The compliance side, I’m growing and getting better at that data assessment, and then the S side, the steadiness, the organization, the structure of the process. Well, that’s where I tend to have a blind spot. And so creating structure, creating a disciplined process, little things like agendas for meetings, little things like writing down notes and having are a duplicatable process. That’s a weakness for me personally. So in my company, I’ll gravitate toward people with that drive passion and that influence skill. And I’ll overlook the need for structure process and systems and so in my company, to be sure I’m hiring people with that tendency, people that are good at structure and process and reduplicated But I’ll say that when we’re in meetings together, and these folks are giving me suggestions and recommending we make these changes, they hit me is uncomfortable with that. I don’t want to have to go through that those those those seem like extraneous processes. Why are we doing that is too much, you know, why are we doing all this extra work? And it’s because I have that blind spot that I have to listen closely to people from that perspective. And so I think that it is important to understand that just like a balanced Tweel, we need all sides, all styles, all communication processes, and methodologies in order to create a really open, well rounded, well-organized machine. I can tell you that the industry has struggled this is nothing new, attracting and retaining women into this business and attracting and retaining minorities into this business. And now I think we must also consider that It’s a challenge to attract and retain all age groups into this industry. these are blind spots. We’ve got to be careful we have to create the most well rounded, open-minded, and welcoming industry we possibly can. That’s the way forward both for retail and for the sport in my opinion.
Kent Cranford 30:23
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Fred Clements 30:57
Yeah, great. So part of the discipline to you show. You wrote a book orbit. And I understand you’re putting yourself on the torture rack of writing and writing another book. And one of my favorite man isms, one of your phrases, it’s gentle pressure relentlessly applied. is one of the focuses of this. Can you describe what you’re doing with your new book?
Dan Mann 31:23
Yeah, well, I’m not trying to get rich with it. I can promise you that book number one told me that, nor is fame an option either. You know, as you well know, Fred writing a book and you said torture Iraq, you’re right on the money, the discipline of just making sure I crank out, you know, from 700 to 1500 words every day to navigate through getting you to know, getting 40,000 50,000 words put together into a book is quite challenging, but I’m excited about the topic. gentle pressure relentlessly applied is the forward phrase that is almost the theme of man University. We talked about it as a methodology for leading change, growing a business, effectively improving your company, or whatever it is that you’re doing the team you work with gentle pressure relentlessly applied. And so what I’ve done is I’ve taken that concept and expanded it into four primary areas of behavior change that a leader or a manager must execute. A leader must, in these four areas significantly create gentle pressure one, you must have an agreement on the approach. So let’s make sure we all agree on how we’re going to do this. Secondly, we must build the metrics that assure we’re getting results. So how do we measure this the second step of gentle pressure-related ideas is metrics. Thirdly, training and coaching and that is when we teach and train and coach and improve the behavior and fourth and finally, a culture of accountability. And that means we are disciplined for Follow up, and we actually do the things we say we’re going to do. And this came true to me, Fred, when I realized as a training organization that we would go into some stores for sales training, and we’d have a difficult time getting results, we would, we’d find that that we after we were there we would try to go back and follow up and create an implementation of these new processes. And we struggled, and I tried to figure out well, why was that happening in some stores. And I realized that training and coaching do not reside by themselves. You know, when people play the magnet becoming a train their team, and they don’t have a culture of accountability, and they don’t have measurable metrics that affirm and confirm that you’re getting results. They don’t have an agreement on this approach. Training and coaching have little effect. So gentle pressure, religiously applied as a lifestyle and a methodology of getting results through people with discipline. systematic way of leading and executing behavior change. Now, in doing this work and writing this book for it, I have said gentle pressure relentlessly applied. You called it a man ism. I did kind of think I invented the phrase. But when we started offering man University six years ago, and we put it into the book, I did some research to go, did I really come up with that? Or where did that come from? And I found it is attributed to a man named Ray Elliot, who was the head football coach at the University of Illinois, back in the 40s. And he is assigned as the person who said it. And so I gave him credit Ray Elliot, the general pressure loosely applied, but as I’m writing this book, I’ve got a whole chapter on the origination of the phrase and I have done extensive research trying to find out who said it first. It’s clear Ray Elliot did not say at first. And there are a number of people out there who have said it and put their name saying they, they said, I’m gonna make sure I’m not saying I invented it. I pulled it from another resource. I heard it in a seminar that I attended in 1993. And I would love to find out who said it first. So if anybody’s listening to this and knows who came up with it, I know it predates 1948. But I can’t for the life of me find out who said it first. But I sure would like to find the originator of the phrase, it’s a good phrase, it’s a good concept. What I have done is I’ve expanded it into the four elements of how you do it, and that’s where I’m creating the origination. So, Fred, I’m a good solid 10% to the book. And I’m hoping to I am hoping to finish it and release it early 2020
Fred Clements 35:44
Okay, so that’s not a mannerism I’ll purge that from my vocab. It’s not even an Eliot ism. It’s an unknown, right it’s
Dan Mann 35:52
a it’s an author unknown ism at this point, but it certainly is. It’s a good concept and it’s again, I don’t know That’s the title move against the sub. It’s the subtitle of my book for sure. I’m not sure the title yet.
Fred Clements 36:04
Okay. All right. So I wanted to ask you, when I first started in the industry I, one of the NVDA presidents Ken Silverberg. from Berkeley, he would always look as most retailers do at metrics, you know, measurements, how am I doing today? How am I doing this week? And he pretty much focused on the obvious one, you know, what were my sales dollars, and it would really bring him down he had one day, I remember where his day was no sales, one return. So he actually had a negative sales day on his metrics. And then you introduced I think, through the group, though, the notion of a closing rate where you find a way to track the number of people coming into your store, and then compare it to the number of transactions and that you come up with a rate that percentage of people that bought something and you use that as a foundation for trying to motivate change and trying to track improvement. Are there any other metrics that you’ve seen in bike or other industries that are easy to access? Try to track where things are going. Any metrics we could talk about?
Dan Mann 37:12
Oh, yes. So, of course, we all keep our eye on sales versus last year. The bike industry baffles me here. Because, you know, in terms of cycling, and cyclists, we love metrics. You know, every single sort of software tells us of our wattage output and how much we rode and what our elevation gain was. And all, you know, that’s how many seconds and minutes and day to day to day to data for performance. And then in the most mind-boggling way, especially the bike retailer avoids great metrics, and it is absolutely a real Miss from my perspective. So I could talk a lot about inventory metrics. But let me make a point for metrics that I think are largely overlooked, that we absolutely must Change, I can count on something I pound on it, we must begin tracking individual metrics, we must begin tracking individual metrics. And what I mean by that is each individual salesperson and their contribution at the register. Now, some of us are not even tracking or register to match our transaction metrics. For example, I mean units per transaction, average transaction size, as well, as you mentioned, a conversion metrics closing rate, those sorts of things. The average unit sold, add ons per bike, there’s a lot of examples but units per transaction and average transaction size. those are big ones. I would like to know I would like to have those metrics for the store average. And I would like to have those metrics for every individual sales associate. Now, why would I want that? Well, number one, because I want to know how each individual set salesperson contributes to the greater good. And are they better than or worse than the store average? If they’re worse than the store average? Does that mean termination? No, it means training. It means conversations to make sure that they’re on board, offering additional products onboard offering more expensive products. I find that too much of the time sales associates, especially like retail are allowed to be on the sales floor, walking around and executing what they believe they should do doing what they think is right, instead of what’s in the best interest of the organization. And so, very few retailers listening to this podcast right now are tracking individual metrics. And you’re thinking to yourself, well, we don’t have the methodology or it would be uncomfortable to share that information or that creates a competitive environment that we think is negative. And I would counter all of that with how are you going to improve the industry. In your business, if you do not know how your individuals are doing, and so we must address this. And by the way, it’s simple at the point of sale to input both the cashier who’s ringing the sale and the sales associate who’s responsible for the sale, sometimes it’s the same number. Sometimes it’s different, but most points of sales will accommodate that. And once I’m tracking who the salesperson is that’s ringing up the sale or responsible for the sale, I can now pull the data for their units per transaction, average transaction sale, and average transaction size and any other metrics I can see about their contribution. This is a must. And I invite anyone listening to this to send an email or contact me to talk about how to get that done. Of course, you have to communicate it to your staff and be prepared for people not to necessarily like it at first, but I can tell you for and we talk about the protective mindset and achievement mindset in a store, the protective sales associate doesn’t want to be measured. The protective ploy doesn’t want to get better. They don’t want to learn, they want to just protect their job, keep it safe. The achievement mindset employee wants to be measured. The achievement mindset employee wants to learn the achievement mindset employee wants to get better. And so the way to work with the achievement mindset is to measure their results, talk about those that contribute and give them opportunities to improve. Because if I know how I’m doing, and for example, I find that my performance is 2.4 units per transaction on average. Well, if I’m an achiever, I’m going to say to the owner about what’s the store average. And the owner says, well, the store average is 3.5. And I’m thinking to myself, wow, I’m doing 2.4 in the store, average 3.5. How do I get better? How do I improve, I want to at least get to the store average because I want to be a contributor, and I want to achieve, that’s the mindset that we’re looking for. So to foster that sort of behavior and to foster that sort of environment. must measure individual performance. So you walk right into that. When did you, Fred?
Fred Clements 42:05
Well, yeah, and that’s hard to apply to a shop owner, right? I mean, so the owner is the owner, they make every decision. Are there ways to measure owner productivity?
Dan Mann 42:20
Well, I would put that in the same context of a head football coach of a professional football team or a college football team head basketball coach, what is the owner’s job to win? And so the owners got to balance everything in that p&l, maintain all those relationships, maintain all of that culture of accountability. And so the scorecard for the owner, of course, rolls up to winning or losing, what kind of profitability we have, are we sustainable, can we meet our obligations, am I retaining good talent? So the owner, of course, has to be responsible for the top-line sales over last year we’re increasing the owner has to be responsible for the overall profit. Or the margin of the business, the owner must maintain all of the expense control, and expense control is one of the most widely variable opportunities for a bike shop owner. So that’s important for the owner. And the owner is also responsible for bringing traffic into the door bringing people in the door putting out the marketing effort and the goodwill and the reputation of the business. So yeah, I’m not tracking the owner’s contribution at the register. I’m tracking the owner’s contribution to the in the p&l Right, right.
Chad Pickard 43:32
Hope you’re enjoying our bicycle retail radio broadcast, be sure to go to nbda.com to check out our membership benefits.
Fred Clements 43:44
So we’ve talked a lot about sort of operation of retail and I know you and I both are invested in the future of the bike industry and in your case, other industries as well. I noticed you still on your website. You mentioned the 20 collected Then that was very future-oriented. Do you have any sort of new views on the promotion of cycling, growing the industry 20 collective? It’s all very forward-looking. Any thoughts on that?
Dan Mann 44:14
Well, the 20 collective served its purpose and created energy and enthusiasm inside the industry that’s now led by people for bikes with the right spot. So that’s an example of a great idea that eventually gained some traction, got some sponsorship turned into a fantastic program that the industry is behind. So the ultimate goal of what the 20 collective retailers wanted to do, and what the right spot initiative is all about, is creating some sort of a revenue-generating program that reaches out to consumers. That funds a marketing campaign that fuels the cost, the incredible cost it would take to advocate for the passion of cycling the benefits of cycling the reason for cycling. And tell that story to the larger audience of the population. So I do think the future is advocacy behind people for bikes and other agencies working together. This is such a fractured industry and it’s sad for me frankly, that that so few entities want to work together. I think that the competition inside the industry you know, is is the red ocean as it were the Blue Ocean Strategy book talks about the red ocean where three or four or five sharks are fighting over the same seal in the water and there are the waters read and there’s a full ocean out there of opportunity. And I just hate to see the bike industry so fractured and everyone combative, and, and fighting against each other when the ride spot initiative and what people for bikes is doing and what the 20 collective initiated, is the idea of collaboration and bringing this industry together, to align our resources to work together. Gather to attract more riders and to create more opportunities for riding and safer routes for writing and everything associated with that. And if we can put aside the bipartisan ism of it, I don’t know how realistic that is. But if we could, then the way forward in an environment of how do we tell a story of what a great ride does for families, for the environment, for communities for individuals, and that’s the story. And so I think the at the heart of the 20 collectives effort was increasing ridership increases retail, and increasing ridership means we must tell the story, we must together with all entities in the industry share the benefit and the value of the sport to people that do not know that and so then I think that’s the way forward and frankly, for everything that we’re doing in the main group, from our commitment to great retail, and To our commitment to what’s happening on the brand side is about a great retail experience so that when customers come in and engage with us, whether it’s online or in a store at an expo, or at an event, they walk away going, Oh, that was a great experience. Cycling must be fun. These cyclists are really interesting and welcoming and fun. I think I’m going to pick it up. This is a great idea. And if we could do that times a million, we’ve got a chance. You know, it’s, it’s that simple. But I think that’s the way forward and so, every effort ultimately has that end goal. And I think, you know, it just it’s the collaborative nature of this is what I think is the solution, and I wish it was more of that happening. So hats off to the 20 collective for it for Shimano, for putting that together. For people for bikes for seeing division, the number of incredible visionary brands that got behind it invested hundreds of thousands of dollars and now we have a great program. The right spot that is all And running, it has the potential to be exactly what we’re looking for.
Fred Clements 48:03
You know, that’s great that the bike industry, the tension between the levels has been there as long as I’ve been part of the industry and people are freaking out, justifiably because of the polarization in national politics and people are being more tribal. And I heard something the other day that kind of resonated with me. Yes, we have differences, serious ones. But the things that unite us are universal and important to both sides in the national politics believe in free speech and an independent judiciary and equal rights. And all of these things unite us as Americans. And yet we have these problems with other issues. And so maybe a little more focused on what unites us than what divides us would, would, would do us well
Dan Mann 48:50
here. I agree with that. And I’m a big fan of the book. Good to Great, and Jim Collins take on what he calls a level three Five leaders. And what I think the industry needs is level five leadership and level five leadership is it is a two-sided approach where a leader has two things one, the leader has a committed will a commitment to succeed. But balanced on the other side equal and opposite to that is humility. And the only thing that brings up competitive will the when balanced with great deep humility is committed to a great vision. And when the organization within organizations within the bike industry can get the vision of a country, like a nation that takes the central leadership of the world for cycling, that we can communicate to here is how communities and families and individuals thrive through cycling. It is indicative of what makes us great and how we come together. And when this industry can take that up as the vision For what we’re working for, that we’ve got something, we’ve got the potential to align, maybe not on the approach, or to align, not necessarily all the tactics, but at least align to the ideology, to the vision. And there at least begins a conversation. And in that conversation, where we trust and respect that each of us is in the same vision, then there’s a chance for us, I think, to work together towards something even better. So I believe that is possible. And I think that that’s even though Hey, we’re talking about bikes, you know, this is a bike retailers are listening to this. And all of a sudden, we’re talking about an ideology. But frankly, every one of us in this industry is in it, not just for the revenue of it, not just for the hard goods and the and the sport and the competition, right, because we do believe in what it does for people and for families and for communities. And so I think we’ve got to keep that front and center and in, we’re never going to stop talking about it. So that’s what we’re doing.
Fred Clements 51:01
Great, Dan. So that’s basically the questions I had Top of Mind here. And looks like we’re almost an hour in. Is there anything, Dan, that you have in your mind that I didn’t ask about or anything that you wanted to get out there?
Dan Mann 51:17
I guess I would just close with a shout out to the national bicycle Dealers Association. If you’re listening to this podcast today, you’re listening because the association is reached out, marketed, and advertised that this is a podcast you should listen to. And I just got through talking about the ideology and the concept of working together at collaboration for the greater good. And I know the folks in the association are not trying to be political. The folks on the association are trying to rally the troops. They’re trying to work for the greater good. They’re trying to bring these entities together. And so I think we are all talking about the same thing. And so that calls for you a little listener to support this effort and get behind those who are working together to build this greater future that the bike industry is, you know, so passionately committed to. So I guess I would just say, look inside yourself and look past the politics of this, and find the ways to reach out and create a conversation with all of the many different folks in this industry that you work with for the benefit of cycling. And I think that’s the way forward. So ultimately, I happen to believe that great retail is what’s going to bring about a great industry. I don’t believe this can be done by itself from the brand side. I don’t believe this can be done by itself from the advocacy side. I think the front end of the leading edge of this is retail. I think consumers find the bike industry at retail. I think consumers are motivated by what they see at retail. I think the consumers get their education, their passion and their skills developed at retail is that front line of The leading edge I think of the industry. So that’s why it is absolutely crucial that there’ll be an excellent, especially bike retail United States. And that’s, I think what the NBA is working for.
Fred Clements 53:13
That’s for sure. So, and I agree with you, that’s, that’s well stated as usual. So I wanted to thank the NBDA for asking me to participate here today. And, and of course, Dan for his insight and wisdom on all of this. And I guess we’re pretty much done here.
Dan Mann 53:33
Fred, good talking to you. As always, let’s do this more often.
Fred Clements 53:36
Okay, let’s do it. Thanks all.
Rod Judd 53:45
This has been bicycle retail radio by the National Bicycle Dealers Association. For more information on membership and member benefits, join us @NBDA.com
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After spending 12 years as a writer and editor, Fred Clements worked as executive director and vice president for the National Bicycle Dealers Association for 28 years. He then moved to Interbike in a retail relations role, later transitioning into consulting. He enjoys helping the NBDA with podcasts from time to time and rides about 3,500 miles each year on his road bike.
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The NBDA has been here since 1946, representing and empowering specialty bicycle dealers in the United States through education, communications, research, advocacy, member discount programs, and promotional opportunities. As shops are facing never-before-seen circumstances, these resources offer a lifeline. Together, we will weather this. We at the NBDA will not waver in our commitment to serving our members even during this challenging time—but we need your support.
Now is the time to become a member as we join together to make one another stronger. Whether you’re a retailer or an industry partner, your membership in the NBDA is one of the best investments you’ll make this year.
Learn more about the benefits of being a member and join now.
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