In My Own Words: Steve Shaffer Featured

7:00pm EDT January 29, 2008

In “Good to Great,” Jim Collins asks what your business can be great at — not just good at, but the best in the world at offering that product or service.

As the second-generation owner of a five-store retail lighting chain, I realized we were trying to be great in two places — with retail customers and home builders — and not growing much at either. And, with the rise of big box retailers, such as Lowe’s and Home Depot, it was no secret that something had to change.

So after 33 years, we concluded that the only way for us to create a better experience for our customers was, oddly enough, to close our stores.

The Internet made this possible. We put everything in our store into an online selection system that lets anyone — our salespeople, a builder’s salesperson, even the customer — outfit an entire house, making selections based on rooms, styles, category and by designer.

In addition, customers can see a running total of the cost of what they’ve selected, so they see when they’ve gone over their allowance. That used to take time for a salesperson to calculate, requiring another visit to the store to make budget adjustments. The system also produces a detailed work order, eliminating miscommunications in the field.

Now, we’re keeping our very best salespeople because they are more attracted to the builder market than to the individual walk-in customer segment. And the financials are stronger, as well, with an average sale of $2,800, compared to $128 for the retail customer. We even move more volume than our retail stores did, with very little inventory cost.

Customers love the experience, and builders value that we support their profitability. It’s a powerful alternative that builds the experience around how the customer wants to shop today, rather than around the retail paradigm of the 1950s.

STEVE SHAFFER is CEO of Lighting Max (www.lightingmax.com) and a member of the Cleveland Chapter of Entrepreneurs’ Organization (www.eonetwork.org), an international organization of business owners dedicated to helping each other learn and grow.