Retail Details: Home Town Hero

May 13, 2014  by in Business Strategy, Industry   

The hilly country where Kentucky, Ohio and West Virginia meet consists mostly of small cities and towns. It’s fly-over country for a lot of people—and for a lot of national brands in home furnishings retailers—but it’s both home and opportunity, as in $165 million in sales last year, for Big Sandy Superstores. The 13-store-strong, Franklin Furnace, Ohio based mid-price retail brand for home furnishings, electronics and appliances filled in another space in the region last month when it opened a new location in Lancaster, Ohio.

 While Big Sandy serves many communities, most are located in a single television market, and that’s worked well, said Robert Van Hoose Jr., chairman of the retailer “Big Sandy has a competitive advantage in our local market based on sheer size,” he said. “Because most of our stores are located in one major television market, we are the number one advertiser for most of our media partners and typically buy around 2,000 gross rating points every week. “Most other competitors would struggle to get to 300 points per week.”

SERVING A REGION

The company was founded in 1953 by Van Hoose’s father, Robert Van Hoose Sr., who worked in the business until 1976.“At that time our total volume was $6 million, and since I had just graduated from college, my dad decided to retire at the age of 47 to move to Florida and focus on the Arabian Horse business,” the younger Van Hoose said. “He sold it to myself and my partner, John Stewart. That started a long journey to grow and expand in our market area leading to a 60 percent share of furniture shoppers in the Charleston-Huntington ADI (area of dominant influence).” Van Hoose and his team have watched what other retailers have done, and brought in ideas from outside the company.

“We have had a lot of outside influences over the years,” henoted. “Connie Post has designed several of our stores, including our newest location in Lancaster, Ohio. Kim Yost at Art Van has been an outside motivator with the way he has led his team with ‘Pumpitude.’ (Pumpitude is the Art Van CEO’s take on building performance through attitude.) “Our vendors have been great partners to support our expansion plans, and we have a great core group of associates that are starting to see the value of being employee-owned and focusing on creating a great customer experience in our stores, every customer,

every time. That is a big focus of ours in 2014.”

 

CUSTOMER EXPERIENCE

Employee ownership is a big part of getting buy in for improving customer experience throughout locations. “It is hard to be totally consistent, as the main ingredient is people and that is another area we are focusing on to make sure we create the same experience for every customer every time, but we have a ways to go to reach that goal,” Van Hoose said. “The merchandise is the same at all the locations, but the presentation can vary depending on when the store was last updated.” Big Sandy’s markets have struggled economically at times, and were particularly hard hit by the recession. Part of Big Sandy’s customer-experience story is offering customers a variety of financing options.

In addition to a standard third-party option through GE Capital, Big Sandy offers conventional financing through Lendmark for those who may have a blemish on their credit record, but still desire traditional, credit based financing. Cross Check is a no credit check, 90-day, same-as-cash, nocredit-check financing option that Big Sandy introduced in 2010. Cross Check allows customers to pay off purchases over 90 days without paying interest. RAC Acceptance is a finance option for customers in difficult credit situations that offer instant approval with long, flexible terms. Some internal changes made for difficulty beyond the economy. “2012 through the first half of 2013 was the toughest period in our history,” Van Hoose said. “We went through a very hard computer conversion that cost a lot more money than the original outlay,” Van Hoose said. “We have recovered from that by refocusing on the customer experience and developing compelling stories for the customer that sets us apart from the competition.” “We service what we sell” is a big part of Big Sandy’s appeal. In addition to service on manufacturers’ warranties, the store sells its own “Total Care Protection,” which provides three years of full parts and labor coverage. Customers have to clean and maintain the furniture according to the manufacturer’s standards; and recognize that damage caused by pets or animals is excluded from coverage. Customers have to clean and maintain the furniture according to the manufacturer’s standards; and recognize that damage caused by pets or animals is excluded from coverage.

 

When it comes to marketing, Big Sandy has three areas of focus. “Our biggest expenditure is color circulars, followed by network television, and social media, which is the fastest growing area of our marketing budget,” Van Hoose said. “We still use radio, but that is declining. We put a lot of effort into our Facebook page, which is approaching 18,000 fans and is a great way to connect with our customer base.” This summer, Van Hoose highlighted “Red, White and Free” tent sales for the Fourth of July period, “and we always add a lot of one-day sales and weekend promotions.”

A program that’s taken off of late at Big Sandy is “iAmerica.” The program highlights American-made sofas, loveseats, sectionals and recliners, all available in hundreds of leather or fabric options and available for delivery within 35 days. Amish-made bedroom and dining collections round out the assortment. “Our I-America story is really gaining a lot of traction and is a great tie-breaker

with the customer,” Van Hoose noted.

THE COMPETITIVE DIFFERENCE

Van Hoose said Big Sandy’s biggest advantage is that the company is blessed with a lot of people who have been with the retailer for 10, 15, 20 years and more. “I have learned when you tell your salespeople ‘the plan,’ that just starts the process and you have to follow up many times and ‘inspect what you expect,’” he said. “Accountability is a critical piece of the formula, and I have gone back

into our TV commercials … and adopted the positioning statement of ‘bigger and better’ and challenged our associates to deliver on that promise every day. “We have achieved size and scale in a market that most other national players don’t find that appealing, but to us it’s our home. We are currently posting some of the best same store sales growth in our history as a result of all these pieces

coming together.”