5 Ways to Stay Profitable in Changing Times
A few weeks ago, after enduring a major rainstorm during a cycling training event, I accepted a ride back to my starting point at a local bicycle shop. The shuttle driver happened to be the owner of the shop, having taken over the decades-old business from his dad.
Though I was disappointed with the weather, I did want to let the shop owner (and training event sponsor) know how much I appreciated his efforts. The year earlier, I had been apprehensive about my first-ever ride from this location close to an inner-city mission where I volunteer occasionally. Over the years, the surrounding area had changed from a traditional, middle-class neighborhood to a more densely populated and less affluent setting. As we traveled to the shop, accompanied by other cyclists, I mentioned that I had found the route to be surprisingly safe and scenic.
My comments seemed to spark an enlightening, honest conversation about how this business owner thrived amid the transformation of the area and other changes beyond his control. Here’s what I learned about his deliberate, not-too-fast, not-too-slow approach.
1. Recognize Changes
Before making any significant adjustments to his operations, he noticed the changes that were taking place around him. He saw that the neighborhood surrounding his business was changing from traditionally Southern with longstanding ties to a non-English-speaking demographic.
2. Adapt in Small Steps
He decided to hire employees who spoke the language of the new neighbors so that basic interactions between employees and potential customers could occur. Product offerings and general business methods stayed the same; long-time customers could still find bicycles, fitness equipment, gear, and service at the shop.
3. Embrace Growth
As these neighbors frequented his store, he discovered what they needed (and bought) on a regular basis: parts rather than new equipment. Though it seemed that sales for new bicycles typically fueled his type of business, he made sure that the demand for parts was satisfied. Adding to his profit margins were cash payments from this new customer group so that he largely avoided risk associated with bad checks and card processing fees.
Another surprise was steady demand for shipping product overseas. Though the owner didn’t seem to have anticipated selling high-ticket items for cross-border shipments, he embraced the business.
4. Stand Firm in Your Values
As we talked, the owner became more and more comfortable sharing his business insights. He even told a story about his dealings with a wealthy customer who also wanted to purchase and ship equipment overseas — but without the formality (and legality) of customs clearance. The financial incentives of the deal were attractive but not so much to risk the long-term viability of his business. When the owner rejected the offer, the customer agreed to make the purchase anyway.
5. Stay Focused on People
Picking up cyclists (like me and a 100 or so other participants) at various points along the route took a lot of communication with his employees and volunteers, and the dedication to assuring the safety and well-being of each person was evident.
Nearing the shop, the owner talked about planning the route weeks ahead of time and then inspecting the route for hazards like broken glass as close to the ride start as possible. Being meticulous didn’t necessarily seem to be a core part of his nature but rather an outgrowth of a conscious decision to take care of his customers, whether they were those who frequented his store or participated in this shop-sponsored event.
Obviously, safety and risk management was a big part of the owner’s job. But finding and fulfilling each person’s need was the focus of his work, and what seemed to help his business thrive despite changes in circumstances.