Canada's business magazine for traditional natural health retailers

16 minutes reading time (3186 words)

Alice Chung, President of Alive Health Centres

A few years ago, CNHR featured Alice Chung, the president of Alive Health Centres, with the intention of following up with a more detailed story, focusing on some of the business aspects that make this dynamic woman so successful in her business. Beginning in 1978 working in a health food store, Alice began growing her 28-store empire in 1983 when she acquired her first store in Vancouver's Richmond Centre. Today, she has stores in British Columbia, Alberta and Toronto.

A few years ago, CNHR featured Alice Chung, the president of Alive Health Centres, with the intention of following up with a more detailed story, focusing on some of the business aspects that make this dynamic woman so successful in her business. Beginning in 1978 working in a health food store, Alice began growing her 28-store empire in 1983 when she acquired her first store in Vancouver's Richmond Centre. Today, she has stores in British Columbia, Alberta and Toronto.

Alice is respected industry-wide for her successful business practices. In the following article, Alice shares some things that have contributed to her success during her 34 years as a natural retailer.

CNHR: How can you effectively oversee 28 stores and one mail order operation located in three provinces?

ALICE: With a team of amazing staff, both in head office, warehouse, and stores. Many of the staff has worked with me over 10 and even 20 years! I have a wonderful supportive husband and son, and a daughter-in-law who works directly with me and will be my successor. I do have a regional manager in Alberta and one in BC. I work directly with the stores in Toronto.

CNHR: What are the duties and responsibilities of the regional managers?

ALICE: They have a very full plate. They review the stores, managers and staff and report back to me. They are in regular discussion with managers regarding stock levels and product mix. Also, they review performance with managers and their staff.

They create a weekly newsletter to report on each store's sales performance, O/S status, new products, and things like that. This helps keep all the stores aware of what the others are doing.

The regional managers also set up our own company seminars with suppliers. Education is a priority and staff attendance is very high. Suppliers provide full-course meals, full-size samples, and we give a $10 staff coupon and gas money for long-distance stores.

Among the other things the regional managers do is substitute for managers and staff on vacation or for emergency leave of absence. They are involved in hiring (and dismissal); they set up the company policy book and keep it updated. Also, they coordinate all meetings with managers in their region. And they have many other duties I haven't mentioned, but you can see they have a lot of responsibilities.

CNHR: You have many long-term employees. Why do they stay with you so long?

ALICE: Yes...it's true...my accountant at head office has worked with me for over 30 years. Most other head office staff is over 10 years. I have one staff member with over 25 years at the Park Royal store. At Oakridge, one is 20 years, another at 13 years. The Guildford store has one at 22 years, one at 18. Prince George has one staff member at 15 years, and another at 13.

In Alberta, the Market Mall store has two at 13 years and Sherwood Park has one at 13 years. The Northland store has one at 12 years. In Toronto, I have two people who have been with me for 14 and 12 years respectively.

Why do they stay? I hope for many reasons. I try to be a good employer, flexible if they need time off, no hard pressure on them, and reward them with incentives in addition to their basic wage. I listen to them, try and build mutual trust and work hard to promote both company and team work spirit.

I'm always there for them – they can email or call me anytime at work or at home if their managers or regional managers cannot help them. I try and make staff feel it is safe with me because I can find a way to deal with their problems. There is no gossip and no politics. We strive to promote from within before we look outside.

We also offer excellent benefits.

CNHR: How do you keep stock flowing to all your stores in a timely manner?

ALICE: Having a great warehouse manager is really important in our case. We have a four-unit warehouse in Richmond for our private label supplements and also for products. We can get huge volume discounts when they are shipped to one location.

Our warehouse manager is Elsa. She is not only the warehouse manager but helps me with the manufacturing, and making good deals with suppliers on my behalf. Elsa monitors product movement (i.e. how well they sell), expiry dates and will only accept products with the best expiry. She checks the expiry of all shipments we receive. She has three staff working under her and they are well trained, because we sometimes get products with short dates. During CHFA shows, we stock up fast movers or prepare for our next flyer promotion. Because Elsa is so amazing, we have minimal inventory, expired items, or product we cannot sell. Any extra inventory is usually returns from stores, so Elsa will rotate it to other stores.

We have over 50 private labels and Elsa monitors movement for both out-of-stock and overstock situations: this is critical, as we only distribute to our 28 locations. Once I source the raw material suppliers, Elsa will take over and work with the manufacturing companies to set up lead-time and send raw material to them. This is an important part of our operation.

CNHR: What are the qualities and attributes you look for in your employees and your store and regional managers?

ALICE: This list is what I look for, especially in the regional managers, since I directly hire them. Sometimes when you cannot find the "perfect" person, you will have to take the second or third choice.

1. Must believe what they are selling.

2. Must lead a healthy life style – "practice what you preach"

3. Must be bubbly, friendly, outgoing

4. Must love to work with people

5. Flexible, assertive, sensitive, urgent, hard-working, team worker, open, caring, sincere, trustworthy, history of long term employment, management experience or skill (regional managers), efficient, observant, fair, objective, merchandising experience, etc.

CNHR: Where and how do you find your staff members?

ALICE: We promote from existing employees for managers and regional managers when possible. When we have to look outside, we use newspapers ads (which we seem to do less and less), Craig's List and other similar sites, mall sites and even help wanted signs.

CNHR: You still work in the stores – primarily at Oakridge Mall. With all you have to do as president of a 28-store chain, where do you find the time to still work in the store and why do you do it?

ALICE: I always believe people can make time for anything, if they try. Time management is very important for all aspects of my life. I work as a scheduled staff three days a week at Oakridge. It is very important to know what's hot and what's not. Hands-on is an essential part of our business. When I visit stores in Toronto and Alberta and sometimes in BC, I can "speak their language" when talking to the managers and staff, meaning I know how they feel and where they are coming from regarding products, customers and their joys and frustrations.

CNHR: How long have you worked at the Oakridge Mall store?

ALICE: Since 1990 – I worked at the Richmond store from 1983 and couldn't leave because customers wouldn't let me move to Oakridge!

CNHR: Do you ever work in other stores?

ALICE: When I visit stores, I also help do sales when the staff is busy.

CNHR: As president, what are your most important duties?

ALICE: There are many. 1) Stay on top of the health industry and be current of what Health Canada is doing and how CHFA is responding to the government stand.

2) I have to stay on top of all the latest and hot products and getting them to the stores as soon as possible.

3. Keep staff current on 1 and 2.

4. Liaise regularly with regional managers regarding staffing and how to improve store and staff performance.

5. Constantly upgrade our stores with better product mix and merchandising.

6. Keep staff happy by responding to their needs and taking their suggestions seriously.

7. Advertising

CNHR: What are your favourite things to do in relationship to the business? What are the things that most excite you and keep you interested in the business?

ALICE: I love serving our customers and my happiest day at work is when someone comes in and tells me that either my staff or I have helped them! I can't wait when a customer says, "Do you know..." I love it when I have an answer for them and have the products to help them. Working at the stores keeps me sane! I forget all my problems.

I love preparing for the flyers. I do like visiting the stores because I always feel I can help to improve things whenever I pay them a visit.

CNHR: Which family member is most involved in the business?

ALICE: My daughter-in-law, Shannon, whom I hope will be my successor. She is only 26 years old but I have no doubt she will make a great CEO. She joined us here at Alive four years ago and got right into the business. She is caring, sensitive, sincere, intuitive, a great motivator, smart, a great writer, hard working, a great sales person and she thinks like a businesswoman. Best of all, we get along really well and think alike most of the time. She is a "super sponge" for positive things. The customers and staff love her! I am blessed!

CNHR: Alice, can you explain all the details about your flyer program?

ALICE: We do a spring, fall and winter flyer. We send over a million flyers in total in BC, Alberta and Toronto.

It takes a month to produce and Shannon helps me with some of the write-ups. It is our biggest marketing effort. We do see customers coming in for the flyer products, so it does work. It helps because the flyers are reaching out to non-health food regulars as well, so we can educate and expose these people to the benefits of the products from the write-ups and exciting products to visit health food stores. I also know our flyers do more than just attract people to our three chains. I know they will also visit other health food stores in their own areas. What we hope for is more and more people will visit our stores and other health food stores and not the drug stores. We'd like to see people use less medications and over-the-counter drugs for their ailments.

CNHR: You have a column in each flyer...do you think this helps build trust and create new customers?

ALICE: I have to thank Deane Parkes for this idea. He told me many years ago to brand myself. The photo and the column give confidence to the consumers, because they can see a real person behind all the products.

The column is very helpful. I often hear customers tell me they read the column every time and want to meet me. I feel like a "celebrity!" They are all smiles when they meet me and want to shake my hand!! It makes me feel good!

CNHR: What is your view on educating customers about natural health products? How important is this to the success of your stores?

ALICE: This is extremely important. We must first educate the customers about the product, not just sell it to them. The selling will come when they know the products and their benefits. Therefore, all our staff is trained to know their products or we won't let them work alone while being trained. That's why attending seminars is so important to our staff.

Our flyers are not about advertising the cheapest price: it is about what the products can do for them. Many customers are not "cherry pickers," they truly are concerned with their health. They need us to guide them in their buying. I often tell my staff, you are not "cashiers." Ask why the customers are buying a certain product if they are not regular customers. We often learn from the conversation and this will open up opportunities to help improve their health condition because the one product they originally asked for may not be exactly the right one or will only help them partially. Our stores print many pamphlets or have copies of information for many products which are popular or new. We offer these if customers would like to learn more. Or, if someone is just enquiring, we hand him or her the information. I call it "planting the seed." I often cut out articles in newspapers and magazines and send them to the stores to keep them up-to-date.

CNHR: What are your thoughts on special orders for customers and getting them to pre-pay?

ALICE: If you do special orders for products you don't carry, the customers will often become your regular customers. However, you must act on this quickly and not have them wait three weeks, two weeks or even one week, because they are on a protocol. This is a challenge if you only have one store, because you cannot make a minimum order or get free shipping because the order was just placed. We have multiple stores, so we train our staff to call the other stores to transfer or add on to their orders. This will help to speed up the orders. I also train managers to place more frequent smaller orders so when there are special orders, they can do another one without much hardship and just add more of those "die hard" products to make minimum orders.

We do a lot of special orders but under ONE CONDITION: They must pre-pay in full or put down a 50 per cent deposit. Unfortunately, not everyone is committed and you don't want to be stuck with products you cannot sell.

Besides, if they want the product badly enough, what's wrong with pre-paying? After all, they have to pay for it in the end. We have this policy because of many sad experiences.

CNHR: How do you think retailers can make better use of supplier co-op dollars?

ALICE: Most suppliers are supposed to allocate a certain percentage of your sales for co-op advertising. We should take advantage of this because it is "our money to spend." If you have one store, there are some economical ways to advertise instead of doing a major flyer like us. In Greater Vancouver, the Metro News is quite reasonable if the Sky Train stations are in your area, or look at your local newspapers. You can do smaller, more frequent ads rather than one big one. Ad mail is another possibility. Only do distribution in your vicinity because this is where your customers are.

I also do customer eco-bags. You can subsidize your bag by getting the suppliers to participate by putting their logos and you can use your co-op dollars.

CNHR: What is your position on carrying the same items as your competitors?

ALICE: I believe in fair competition. We should always work together with our own health food competitors who are in the neighbourhood unless they try to use "cut throat" tactics and show they are not fair players.

In regards to mass-market stores, we shouldn't stop carrying an existing product because it is in drug stores now. We are already losing some of these sales and if you stop carrying common products, you are going to completely lose ALL the sales. I was told or read somewhere and I always remember this: when it comes to a business decision, you use your head, not your heart. Don't get mad, GET EVEN!

Go and find out what else they carry that you can buy and compete with them. Not all customers are cherry pickers or mass shoppers. Who is better educated about health products than we health food retailers?

Let those cherry pickers go because we still have many loyal health food goers and it is our "duty" to give them the products they have been buying from you. Don't lose them. With cutthroat health food stores, just match their price and if the customer brings in their flyers, match the prices so you don't lose your customers.

CNHR: When you see a hot natural health trend, what do you do?

ALICE: We try to find out if the product is safe and if it is true. If it passes, I will send emails to some of our suppliers to see if they carry this or will carry it. If not, we may manufacture the product if we can get an NPN or EN.

CNHR: Where do you watch for these trends or hear about them?

ALICE: Dr. Oz and other TV shows, radio, newspapers, and magazines, customers' requests, etc.

CNHR: How important it is for retailers to stay on top of these trends and react to them?

ALICE: It is vital to stay current and on top of the trends, as this gives customers the confidence that your stores keep up with the trends and are able to secure the products as soon as possible.

CNHR: What do you see as the major trend today?

ALICE: Baby boomers – they are getting older and increasing in numbers, so there is a lot of demand for products to keep this population healthy. This group of people is also afflicted with problems like heart disease, diabetes, HBP, high cholesterol, etc. So we need effective products to help to prevent them from taking so many medications. We have to guide them to healthy eating, exercise, rest, etc. This group is also looking for anti-aging products, either topically or internally.

CNHR: Any last thoughts for your fellow retailers?

ALICE: Stay on top of all hot and new products. Keep your staff excited about them and knowing that if we can get the new products, their customers will get them!

Never disappoint your customers by being out of stock or not carrying certain products. We are lucky as we either rotate these products in from other stores or place special orders for the customers. This is important to keep the customers' trust in the company. Our staff really cares for their customers.

Always support your staff – know there are always gray areas with irregular returns. Be flexible with discounts on major purchases so they don't have to deal with unhappy customers or lose a sale, or have to match prices.  Flexibility in all areas is very important. • 

 

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