Meeting shoppers’ needs in Athens
Rattles & Rhymes finds success in the middle
By Lisa Casinger -- Kids Today, 1/1/2009 12:00:00 AM
Maxine Guerrera came to the industry the way many retailers do — she had kids. Prior to that, Max had worked as a buyer for Burdine’s for 12 years. After getting married and starting a family she thought she’d be a stay-at-home-mom, but discovered that wasn’t for her.
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| Cocalo and Munire are two of Max’s vendors, shown here with Calista bedding and Essex crib. |
“I noticed the need for a baby store in Athens and went to a trade show and decided I was going to open a store,” she said.
Initially Rattles & Rhymes was a 1,600 square foot high-end boutique offering mostly furniture and a stroller or two.
Max and her husband Joe quickly realized the community needed a mid-tier store that offered more than just furniture. They doubled their space within a month and doubled it again by 2005.
“We had 70% growth in revenue based on changing our focus,” Max said. “We became a full-fledged department store, and by that I mean we have a department for everything — layette, toy, gift, bath, nursing and feeding, linens, bedding, furniture and gear.”
Max’s participation in Baby Furniture Plus Association enables her to maximize her purchasing power and compete with Target, which is across the street.
Two years ago Rattles & Rhymes reviewed the baby registry it was offering and decided to take it to the next level.
“We needed to become a little more professional in how we did our registry,” Max said. “We bought scanners, put the registry online and enabled customers to change it when they needed to. We met a need in our community. We used to do it the old way, writing down all of the information by hand, but adding the scanners (once we found ones that were Mac compatible) increased our registry sales.”
There’s also a computer on the floor where customers can access and update their registries.
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| Rattles & Rhymes carries strictly infant products like this furniture from Bonavita and Sorelle; bedding from Doodlefish; and custom bedding from Pine Creek. |
Rattles & Rhymes is located in a strip mall, a location Max chose for its affordable rent and ability to expand.
“Baby stores are destinations so I knew I didn’t have to be on the beaten path and pay higher rent,” she said. “Our store is on a secondary road and we have great signage that can be seen from the road.”
Aside from saving money on rent, Max also came up with a way not only to save money, but to make money on gift wrapping.
“So many speciality stores offer free gift wrap and we did too, but it got to be an expense,” she said. “So, we turned it into a profit by using the ideas department stores did. We treated it like an item to purchase with varying levels of add-ons.”
The store itself, aside from being laid out by departments, also features a seating area where customers can flip through product catalogs, much like what can be found in fabric stores. There’s also a design area where customers can either work on their own projects or where Rattles & Rhymes employees will help them design their dream nursery.
Since merchandising was part of her job at Burdine’s, Max is a firm believer in the importance of good merchandising and moves product around every two weeks.
“I don’t want a customer to see a half-dressed area,” she said. “You have to create an area that’s inviting and friendly; it shouldn’t look like a warehouse. I have to feel like the customer coming in thinks this is the best store they’ve ever walked through.”
Max points out that when your store looks good customers assume your prices are higher, but, if you are savvy and a good merchandiser you can also price well. For example, think about how you ticket merchandise. On a value-priced crib you might highlight the price, but on another product you might highlight the brand. This requires not only knowing your product but also knowing what your customer will find important.
Though Rattles and Rhymes is located in a college town, home to the University of Georgia, its customer is 24-42, educated with a median income of $45,000-$120,000; she’s a working mom. The surrounding communities are some of the fastest-growing counties in Georgia.
Max reaches these customers through TV and radio ads, targeting the growth areas. She’s tried magazines and direct mail but found they didn’t work well for her market.
“We’ll also grow our Internet advertising, and our Web site with the virtual store tour is a huge benefit; once they see that they want to come in,” she said.
While Rattles & Rhymes has a Web presence, Max says the Internet is her major competitor.
“The Internet is our biggest competitor but we use it to our advantage with our own site and store,” she said. “We have a virtual store tour and registry online so people all across the country can shop for their friends and family.”
Rather than being a “showroom” for Web-only stores, Max and Joe use their program discounts through BFP to lower their in-store markup on bedding and gear, enabling them to be more competitive with online retailers.
“We don’t look at our markup percentage to gauge our business,” Max said. “We look at net retail dollars; we can take advantage of prepaid freight and discounts to compensate on lost margins. This makes us competitive on price rather than losing the business to them. It’s increased our gear and bedding business; we do more on volume at a slightly lower margin, but profits are up.”
Rattles & Rhymes also competes with Target, but Max has turned that into a boon for business. When Target launched its return policy (within 90 days with a receipt or gift receipt) and consumers responded negatively by not registering with the retailer, it helped Rattles & Rhymes.
The store relies heavily on technology.
“We are completely computerized,” she said. “Everything is run through a computer, except my planning. In that I am an old-school buyer and I sit down with a pencil and maneuver the numbers. The key to a successful business is to have a plan for the year and then adjust the plan accordingly.”
Max says you can’t operate with the mentality of “I just want to beat last year; you have to know how you’re going to do it.”
The store offers everything a parent would need for baby, from furniture and accessories to gear, textiles, apparel and more. The three top-selling categories are furniture, gear and the basic essentials (nursing, feeding, bath).
Though Max has found some growth in her bedding sales this year, it’s not as big a seller as she’d like.
“In this economy especially, we’re seeing customers go for the necessities,” she said. “We always stress the importance of a good car seat, crib and mattress and everything else is extra.”
When it comes to hiring employees (the store has eight), Max has a pretty common sense secret.
“In my travels out and about, whether I’m going for coffee or in a restaurant, if I get good customer service I solicit them for my store,” she said. “We have hired people who’ve just come in and gone through the interview process, and we’ve been lucky. But I’m always on the lookout for good customer service.”
Time management is Max’s biggest daily challenge. She and Joe juggle the business and their family—they have two sons ages 10 and 13; Max also serves on advisory boards for Medela, Britax and Kids Today; and she’s a BFPA board member and a member of the association’s wood committee.
“I get a lot of joy out of the committees,” she said. “It helps the industry and it helps me grow my business. I can sit in a room with other store owners and listen to different opinions and it only helps me get stronger. I have a passion for that.”
Max says one of her best business moves was partnering with local hospitals.
“One of my reps confronted me about renting breast pumps and I said I’d rather sell them,” she said. “The rep said trust me, so I partnered with my local hospital and they send all of their moms here for their nursing and feeding needs. If the lactation consultant says I need to carry this nursing pillow, I buy it. I know it’s going to sell because she’ll send moms here for that product. That has helped triple my Medela business.”
While 2008 started out well, the last half of the year sales were down. However, Max’s goal for the coming year is for continuous growth and possibly moving into a bigger location and expanding her assortment even more.
“I don’t want to be huge, I just want continuous growth,” she said. “I’m at a level I like. I’ve spent the last six years in a huge growth mode and I’m ready to relax and enjoy the ride.”
Despite the glum economy, Max would advise someone just starting out in the business to go for it.
“I think there are markets that need an independent juvenile business,” she said. “I’d also advise someone just starting out to become a member of a trade association. Being a member builds relationships; it gives you ideas and it helps your bottom line with discounts.”
Max joined a trade association when they first opened the store based on advice from reps, but also because at that time only association members could attend the specialty trade show.
“I’ve learned so much from so many different people in this industry,” Max said. “Some people are afraid to give away too many of their secrets, but I can take ideas and make them work for me in my area and working with other store owners just helps strengthen that.
I’m a big advocate of speaking and talking to as many people in this industry as possible; I still feel that if you’re in this industry you have something to offer or something to gain or something to give. I think if the specialty store is going to continue to be strong within a tough environment and the steady competition you have to rely on each other; you can’t isolate yourself you must pull in others and use your strengths together.”
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