Canada's business magazine for traditional natural health retailers

Dave Fuller, MBA is an Award Winning Business Coach with over 30 years experience in the Natural Health industry. Dave is the Author of the book Profit Yourself Healthy.  Email dave@profityourselfhealthy.com or check out his website www.profityourselfhealthy.com

For how long will you be dead?

for how long will you be deadBrian Tracy, the famous sales trainer, has a story that he tells about the importance of great questions.  Brian was having a meeting with a life insurance salesman who asked if he had enough life insurance.  Since he did not want to deal with this man, Brian assured him he did have enough insurance. As he was about to finish the meeting, the salesman asked Brian the question,“How long will you be dead for?  Because” he went on, “with the life insurance policy that you currently have, you are going to need to come back to life after six months to help pay the family bills….”

The reason I bring this up has nothing to do with life insurance, although especially in the early stages of a retailer’s lifetime, life insurance might be a good bet.  Unfortunately, most people in our industry don’t consider their untimely death. None of us want an early expiry date, and while we might hope to live to a ripe old age having accomplished all of our objectives, life has a funny way of throwing a wrench into the best laid plans of mice and men.   

Often, I have clients who want to work with me because they are preparing for their exit from the business.  Some have the foresight to make plans when they hear they have an illness or are approaching retirement age. Unfortunately for some business owners, they don’t have the right plans in place when they die and as a result, there is no one to help their family or employees negotiate through the traumatic days that follow the loss of an owner or founder. 

So, what would happen if your staff woke up one morning and discovered that you have died? Hopefully they will miss you and shed some tears, which means that you probably made a difference in their lives.  However, without a plan for emergencies, like death or even the disability of an owner or founder, companies that were once going concerns, stumble and begin the downward slide into oblivion. In the following weeks and months – as the family is grieving – it becomes apparent that the vision, direction and strategy that the owner brought is missing . Often key employees who doubt the future without a leader jump ship.  Without leadership, many businesses and their employees become paralyzed by indecision. In either case, the future is often bleak for the future of the store.  

While a life insurance policy might protect your family from some of the financial losses of your income, does it protect them from the financial liability of your businesses? To ensure that your business can survive you, there are a number of things that you might do.  

These include:

 1) Writing down a plan for the worst-case scenarios and discussing them with key staff members.  

2) Talking to trusted advisors including lawyers, accountants or mentors, about what your plans for the business are. 

3) Discussing or documenting some options for transitioning the ownership of your business should disaster hit such as: 

• who should your management team talk to? 

• will they need a business coach or fractional CEO to come in and help?

• what should they expect for leadership from your family? 

• how would you value the store if it needs to be sold? 

• what happens if they can’t sell the store? 

• how should they deal with family? 

 While the answers to these questions might be included in your will, having backup documentation in your operations manual or company safe, might be a great start as well. 

Not many people come back to life after being dead! Chances are you won’t either.  If you want to rest in peace before and after you die, it might make sense to come up with some concrete plans that position your business for the benefit of your family and employees long after your untimely departure. 

 

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The 100 year retailer

Recently, a retail store in my community celebrated 100 years of operations.   There was a party, celebrations and even recognition from politicians for their years of service to the community.  I honestly don’t know much about the business except for the great service I have experienced as a patron over the years.

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Is it possible to work less and earn more?

dave fuller articleRecently, I asked one of my clients what they had learned in the past year. He said: “I learned that I can earn more by working less!” My response: “You just learned in a year what most MBA students never learn in a lifetime.” Not only had my client doubled his income over the past year, but he also significantly reduced his stress levels. 

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When customer service is not enough

dave fuller customer serviceI am sure that you have suffered through an experience of poor customer service.  One doesn’t have to look far these days to realize that many businesses put low value on treating customers well. 

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Profit Holes

profit holesIt was serious business! My brothers and I were neck deep in it. We were digging to China when we were interrupted by the sound of our mother calling us for dinner.

Digging holes is something that boys do. As kids, we would dig holes for forts, holes for adventures, and holes in search of gold. At the age of three, my son dug a hole to trap bears.

In business however, when we dig holes – unless we are in the construction business – they are usually not good. I have dug myself some holes as a businessman over the years. The biggest hole that I dug was hundreds of thousands of dollars deep. These types of holes don’t happen overnight: they take lots of planning and many hours of making mistakes, and sometimes years to get out of.

Find your profit holes

The most common holes in business are profit holes. Profit holes are those costs that build up over time and eat away at the owner’s profits. According to the National Federation of Independent Business in the USA, 60 per cent of small businesses are either not profitable or are only marginally profitable. To be clear, the profit in a business is what is left over after paying all of your expenses. In a small business, there are many expenses: the cost of goods, labour, insurance, supplies, utilities, computer equipment, etc. The list is almost endless it seems. Unless we are careful operators of our business, we may find ourselves among the 60 per cent of businesses where the owners receive very little to speak of in terms of money at the end of the day.

One of my clients, we will call him Paul for the sake of this story, owned a health food store that he ran for several decades. As he was thinking of selling the business, he realized that new owners would probably like a business that was a little more profitable. Paul started examining his income and expense statement with a fine-tooth comb. He discovered several areas in which some of his costs had crept up over the year. In one case, he found that he had originally employed a cleaning company on a contract for a small job for $50 per week. Over time, they had gradually raised their prices to $100 per week. He consulted his employees concerning this job, and was told that they thought that they had time to do the contractor’s work as he was only spending 15 minutes a week in the building. Profit hole filled = $5,200!!!

Paul kept digging. One day he got a call from a service provider for debit machines. They told him that he would save $400 per month if he switched over. Paul didn’t switch, but he used that call to ask his current provider to match their rates. When they agreed, Paul saved an additional $4,800 being lost through a profit hole.

When Paul plugged these two profit holes, he saved himself $10,000 per year. For a small business owner, $10,000 a year can be very significant. Not only did Paul enjoy that money immediately, but he increased the value of his business at the same time. Potential buyers always want a profitable business!

When we are looking for ways to reduce our expenses and plug profit holes, we need to look through each and every area of the business.   We must ask ourselves how we can reduce our costs in this area. In my book Profit Yourself Healthy, I identified 107 different ways that small business owners can reduce their expenses. These include reducing costs in areas such as labour, energy, consulting fees, insurance, travel expenses, maintenance, and more. Sometimes we can eliminate an expense.   Often times by putting the product or service out for tender again, we can lower our costs. The trick is to look at the largest expense areas first, and figure out ways that we can create efficiencies.

The longer we have been in business, the more profit holes we can find. Like Paul, we let little expenses build up over time and the result is an erosion of our profits. It’s easy to dig holes but sometimes it’s much easier to fill them.

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Things You Can Do for Your Store to Thrive

dave fuller articleMany retailers are stressed at the thought of what is happening in the health food industry right now. Amazon buying Whole Foods, the erosion of margins with online shopping, and more and more products showing up in the mass market.

If you want to survive as a health food retailer in the next couple decades, you are going to need to do things differently than you did in the past.

  1. Exclusive products

To survive, health food stores are going to need to have their own brands that are not available everywhere.   To have access to this, health food retailers will need to have a supplier that is giving them brands of products that are not available in the mass market.  While you may feel you need some mass market products, your customers are coming to you because you are the trusted advisor. If you have the knowledge to help them address their problems and concerns, they will buy what you put in their hands.

  1. Niche markets

Health food stores who survive the change in the retail environment will have to have specialty niches where they are able to identify their potential customers and offer them specific products to satisfy their needs.  Perhaps this is an anti-aging clinic, the men’s testosterone stop, or the skin care centre.  This may mean that you will have to do things that you didn’t do in the past: offering services that are difficult to do, or products that are hard to get.  Health food retailing will be getting harder, but the creative will thrive. 

  1. Human contact

Millennials, Generation Xers and upcoming generations are going to want the human aspect of retailing that baby boomers had and then some.  While we all might be on the computer more, we all crave to be touched, spoken with and humoured. Physical touch and real human presence is hard to experience over the computer. Brick and mortar health food stores will be around as long as they can offer this.  Store owners are going to have to encourage their staff to develop meaningful relationships because this is what customers want.

  1. Experiences

   It’s true that 3D is coming to retailing online, but you can’t taste food, feel fabric or smell scents online. Health food retailing is going to need to give customers even more experiences that fill the senses.

  1. Business knowledge

It was once the case that you could open a health food store because you wanted to help people have a chance of success.  The chance of success now has been significantly reduced. In the past, store owners would spend money in advertising without measuring the results and set margins and price products upon a whim. Look at financials once a year and rely on your accountant to interpret them.  Future store owners are going to need to be strategic, cunning and knowledgeable to thrive.  Those that understand how business works and how they can create value for their customers, are going to be successful.

Health food retailing is changing but those who can adapt will be able to feed their families, hire great staff, help their customers and contribute to their communities for years to come. 

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Make your health food store a winner

make your health store a winnerWhich silver car is it?  Tony Kibonge shouted, as I tagged a car and he raced by. This race to the silver car was a re-match of another race I had won one cold morning in Stuart Lake. We had raced through the water up to my chest and Tony’s neck!   While I had won both races, the truth of the matter is that Tony ­– who is 13 years old – is a much faster runner than I am.  In fact I think he might be one of the fastest 13 year olds in the country.  However, in both races, I made sure that I had distinct advantages. I really had no intention of losing, although in both races it was a real possibility.  More on that later.

But what about you? Are you intent on winning with your store? Do you have a strategy or are you going up against, quicker, faster, better competition and just hoping that you are going to win, without really even a hope?  So often we are going against competition that is so stiff that our goal is just to keep our heads above water and pay the bills. 

Give yourself an advantage

So why don’t we change the game?  When I raced against Tony Kibonge and his class the first time in a lake, I knew I had a clear advantage.  I knew that I weighed 100 lbs more and was a good eight inches taller than Tony and this would help me as I moved against the water in the lake to the finish line. In business, we often think that we have to run the race that our competitor has already established an advantage in.  I knew that if I was to race Tony in the 100, 200 or 400 meters that he so loves to race,  I would be left in the dust. So I don’t race those races.

In the health food business, we too need to change the odds so that they are in our favour. We need to think about what we are better at than our competition, both online and mass.  If our competition has better prices than us, then, we better focus in an area where we can add value and price is less of an issue.  This may be great service or exclusive products.  To distinguish ourselves, we need to really be different and find customers who are willing to pay for that difference.

Setting goals

And what does winning mean? In every race, there is a finish line and a goal that we are striving for. However, most small retail health food stores don’t have real goals. We are just plodding along hoping that our store is going to grow without having any real plans, any targets for sales or marketing, profit, or any other measurable outcome. 

If you would like to double your business in three to five years, you need to grow at 20 per cent a year.  So, how do we do that?

  1. The first step is to establish a goal and to write it down.  Put that goal up on a wall or white board – somewhere you will be reminded of it often and everyone on your team can see it. 

  For example, “Sales Target: by 2020, we will have two million dollars in sales.”  

  1. Pick a Strategy to Achieve Your Goal – It might take time to work this out with your team, but if you want to get people on board, you might want to include them in picking the best strategy. If you have a really small store, it might mean that you need to set time aside to put some thought into how your business will achieve the goal.  What specific customers are you going to go after? Where is the area that you are going to have a distinct advantage over your competition? Do you need to change your pricing model or your marketing strategies?
  1. Lay out some tactics to achieve the strategy. These might be things like: We are going to start putting on more seminars in the store; we are going to focus on brain health this year; I am going to spend 50 per cent of my time each week working on the business and getting more people in the store, and 50 per cent working on the floor. 
  1. Measure your progress.  Once you have started working towards your goals by implementing your strategies and tactics, you need to measure the progress and celebrate the wins. In the retail health business, we need to play to our advantage.  Just as I tried to beat Tony by setting the parameters of a race that I could win, you need to do the same thing with your business.

Focus only on areas where you have an advantage. Know where the finish line is, and celebrate each and every accomplishment. Make your health food store a winner! •

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Five things you can do to get your customers to buy more often 

dave fuller 1articleMy friend Aaron likes to tell the story about how he arrived at a hotel and how they greeted him at the car. Shortly after, a staff member said, “Aaron, you’re a Manchester United  fan, aren’t you?

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Building a sales system

Building a sales system

One of the keys to a business’s success, and a factor that needs to be paramount in the success of many small businesses, is the ability to relate to customers and sell his products and services.  While selling seems to come natural to a few people, to most of us entrepreneurs, it takes work and we need to understand that there is a science to it.  Below are the steps to being successful in selling.

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CNHR News Podcast

cnhr radio hour

News, Views and Happenings in the world of Canadian Natural Health.

Check out this month's podcast here

CHFA West Preview

Build Your Brand through CNHR Magazine • Include CNHR in your branding strategy 

What's in the Jan-Feb issue:

  • • CHFA West Show Preview
  • • Alberta store features
  • • Wrap-Up of HFN AGM
  • • Amazing business columnists

Get into the hands of 10,000+ retailers

Reach 10,000+ natural health store professionals via CNHR Magazine.  CNHR is delivered by Canada Post six times per year to virtually every health food store across Canada.  Retailers are your true sales force.  So, get your product into more stores and get them selling for you.  

Remember, your first sale is to the retailers.  CNHR can get your message in front of them. Connect with the retailers who sell and recommend your product.

Put CNHR’s many resources to work for you:

Display ads, Product Profiles, Trade Talk news in CNHR Magazine along with Facebook, CNHR web page, 

podcasts, inserts, videos posted to our website, sending product samples to stores…we have the access to Canada’s natural health retailers.  Put our many resources to work for your company and products today.

CNHR is your Trade Media source.  We’re more than CNHR Magazine.  That is just part of what we do.  

We are keeping the industry informed and updated through the magazine, the CNHR Website, our Facebook Page, the CNHR Podcast and our industry e-blasts.  Ask me about all we can do to connect you to the industry and give you blanket coverage across Canada.  Let me help put all of CNHR’s resources to work for you!

Contact:  Katherine Stevens:  kstevens@cnhr.ca   647/975-3370         Contact:  Candace Sicari:  candace@cnhr.ca   705/209-9280

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