Adventures with Corndog: Corndog's Fish Store

Landlord is taking their sweet ass time to get the signed lease back to me. Supposed to be back in my hands by Monday. I dropped off my signed portion on Friday. After not getting a response back on corrections for 2 days prior to that. Looks like real construction on my shop will start after Christmas.

Lyrical_sl said:

How have you structured the lease so you can bail out of it, in a worst case scenario?

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It's only a 2 year lease, if you're asking how I can get out early. Otherwise I'm not sure what you mean. I tried to get longer terms, but here I'm running into landlords that don't want to lock in more then that as everyone is expecting the rents to go back up.

Anyone have current advice on payment processors for a retail location? I called my bank on the recommendation from another local business owner. They wanted 3% plus a setup fee, plus an annual fee, plus $8 each month minimum plus a terminal rental.. Once I listened to the rates, I said hmm, square is 2.75% why would I want to pay more? The response was that they could offer an insurance on the terminal vs fraud, but not very many people use that anyways...

So I'm considering getting an ipad or android if they can run via wifi with square as my terminal and just pay flat rate 2.75%. Every time I look into another payment processor option, all the hidden fees outweigh the lower %s.

BrutulTM_sl said:

I have seen businesses that do the ipad thing. There is a restaurant here in town and their "cash register" is just an ipad on a stand. I don't know what app they use but it's kind of interesting.

Not taking credit cards isn't really an option for a retail store.

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I bought an Ipad on ebay first gen for $250. I'm gonna try it out. Square puts out their own point of sale app for free for the ipad. Not only does it take credit cards, but it has a loyalty program, like ever 5 fish you buy you get 1 free etc. Can also do giftcards I believe. The thing that's irritating is that it can ONLY use 1 type of receipt printer. I still haven't decided how I want to handle that. Can email or text receipts as it is. But there will be people that want a paper receipt. My business is working towards being green, so maybe I can get away with it stating that a physical receipt is just wasting resources.

Yeah I agree on the printer. Waiting to order it until I play around with the app first.

I ponied up and ordered the Square receipt printer and cash drawer. I was able to mess around with the IPAD square app and it is pretty darn slick.

This lead my retail brain to some new research. Pricing. As I was playing around with it I was making test items. There is a ton of research on retail pricing. Specifically what I was looking at was the way to price an item. Not how much to price it for.

These all have different connotations in the human brain apparently most of them subconscious.
A. 0.09 cents or cent sign - Cheapens the item. A item ending with nine is thought of in the mind as cheap.
B.$0.09 Dollar sign - Our subconscious knows this comes out of our bank account. Without the dollar sign, it's not real money apparently.
C. amounts ending in 4-7 - This indicates the item has been priced as cheaply as it can get.
D. 1.00 Even amount - Our mind thinks quality, expensive. This is used on higher end status items. A purse for example, a woman would rather pay 650.00 for it than $649.99.

The problem with these "facts" as they aren't universal. Depending on the part of the country, economy etc. Also were talking about percents here. Some things boost sales by 24% while the next study shows it boosting sales by 17% etc. No one can explain why any of these "work" and there are plenty of businesses that step away from the norm and do fine. Walmart for instance uses 8s on their pricing which is supposed to do nothing. Except on web searches it comes up cheaper than it's competitors.

This lead me to further investigation as it didn't really answer my question. Store atmosphere seems to play a large part also. Whole foods a higher priced grocery store used granite counter tops and tile floors etc to appeal to the status side of shoppers and charge higher money for items. The last 2 years, they've been remodeling their stores and taking that out and leaving stuff like silver ventilation ducts exposed and concrete floors. As this shows the shopper that they're saving money anywhere they can to pass the savings onto the customer.

Another interesting fact I read about was that you could have a widget for $1 every day. You can take that same widget, mark it at $1.50 but put it out on the floor on a pallet with hundreds of them sitting there. The mind assumes because there are so many sitting there, that the widget has to be the cheapest around because the store bought in bulk.

In the UK stores have stepped away from using cents all together. They just use round numbers. 70 cents. 2 dollars etc.

With all this information fresh as of yesterday for me. I'm trying to figure out who I want to be as a store. I already know I wanted to cater to higher end clientele. Not be the cheapest on the block, however be the best quality on the block. Also I'm trying to make myself different from every other store in my field in every way I can. Instead of directly competing on something, just do it differently or offer the customer a different experience.


Anyone have any retail thoughts on this subject?

I think at this point I'll be going with whole number pricing and no dollar signs.

Something like this:
Goldfish 3.00
Fish Food 3.50

The second thing the IPAD let me explore was loyalty programs. The square app has a program built in that lets you set a couple of parameters. The standard one setup is, 10 purchases of $10 or more gets you a 10% off coupon. You can change all of those numbers but it got me thinking of offering some kind of program.

I'm wondering about a membership club card type of thing. Imagine your hobby, whatever it is, fish, stereos, cars etc. What price would you be willing to pay to get a card that gave you 10% off everything. Kind of like a membership card to costco. You buy in for $35 a year. You get the privilege to shop there. Being a small business, I won't have the clout to pull off a you can't shop here unless you sign up. But what if for $20 you got a membership card that gave you 10% on everything you bought.

The goal here is not to general extra money from the $20. My goal is to make the customer feel obligated to come to my store vs a competitor. A major example of this is Amazon Prime Membership. They lose money shipping the items out 2 day priority on everything. $80 a year doesn't cover it. However what it does buy them is, most people who have a membership will check amazon.com FIRST for an item. Leading to many more sales but at a lower profit.

I'm trying to think of a sweet spot for a small business. $20? $15? $25? The problem is there needs to be a benefits package I think. If you get 10% off and you only spend $100 a year on average on fish. If you bought the membership for more than $10 you'd be losing money. Also if you've only spent $10 on the membership would you feel married to my store instead of another store down the street?

I think I have to come up with something besides just a discount that the membership gives you. So that I can get the membership price up to maintain loyalty. Some thoughts were a "fish of the month" By being a member of the loyalty program, each month I would have a fish in stock that you got 1 of for free as a perk.

Or what if it was an item. Like prebuy fish food for the year for $60. Each month you would come in and get your fish food you've already paid for. The bonus would be 10% off everything you buy in the store. This would bring customers back at least once a month.

Anyone have any insight on what it would take for them to align with a specific store? Obviously selection, prices etc are very important, but sometimes a sense of belonging goes a long way.

Thank you for all those insights Opiate. I had thought about the punch card system. I hadn't thought about the starbucks system. But it's pretty clever. I'm not a coffee drinker and had only heard about it briefly once before. I'm gonna look into that some more.

BrutulTM_sl said:

To me the loyalty program idea seems a little odd for a fish store because I think most people think of getting an aquarium like getting a puppy. You're not going to be coming back all the time because now you have your fish and you're good except for food which is cheap enough that people don't care much about saving 10% on it. There are enthusiasts that are buying fish and gear all the time, but I don't think average people go into a fish store thinking that they are going to be spending money here every month.

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Most people who get an aquarium keeep buying fish every weekend until their tank is full. The worst thing that can happen is selling them an aquarium which has basically no markup and then them buying fish from somewhere else. But yes, a loyalty card is unconventional for a fish store.