A store for all seasons

Running a hardware store in a coastal resort town has its own unique challenges: a diverse, seasonal clientele; unpredictable passing trade and a market where presentation is everything…

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Store: Dunsborough Makit Hardware & Home Centre
Proprietors: Peter and Margaret Baxter
Group: CPS
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Customers at Dunsborough Makit Hardware & Home Centre, about 270 kilometres south of Perth, have different reasons for entering the store. They could be amongst the 4,000 local residents in need of the occasional item of home ware; they might be roving holidaymakers with a taste for the local Margaret River wine, desperate to find a corkscrew and some glasses; or they might be surfing fanatics wanting to repair the roof rack on their way to the famous beaches nearby.

According to store proprietors Peter and Margaret Baxter, the location of their store lends itself to plenty of variety. In 2000, the region was classified as the fastest-growing centre in Australia, making for a vibrant and eclectic mix of clients ranging from new home builders and renovators to business-related clients and private consumers from a broad demographic. About 30% of all business is trade-based.

Dunsborough Makit Hardware & Home Centre can be found 270 kilometres south of Perth

According to Peter, the move into the retail hardware business was motivated by his wish to create a true family company. “I come from a building background with sales experience, so I looked for an opportunity to establish a family business where all family members could contribute,” he says. “Our son Scott works with us.”

The store comprises new premises that were redeveloped in 1998, and is 490 square metres in size with street side parking at the front of the store and rear access for trailers and deliveries.

Group benefits

As a member of the Co-operative Purchasing Services (CPS) group, the store benefits from significant business name recognition. Operating under the Makit banner, Dunsborough Hardware is one of about 40 Makit hardware stores in WA, all of which share the advantages of group marketing to consumers. With such a large and mobile clientele sourced from disparate areas, Peter says his membership of CPS is critical to the success of the business.

“We really have to be a group store,” he says. “It’s a tough industry without a profile and marketing. Unless you have a monopoly as an independent, I do not believe you would survive.”

While Makit’s corporate image is a credible and powerful tool for attracting passing trade, Peter complements the Makit marketing activities with mailouts to local householders and tradespeople.

“We use Australia Post to inform our local customers of initiatives and sales,” he says. “It’s extremely cheap and effective, and the group also produces five catalogues per year.”

Given the diverse client base, Peter says he has to stock an unusually wide range of products. “We have introduced various sections to our store to complement the hardware range,” he says. “Our customer base is diverse, from trade to local DIY, tourist and holiday home owners, and the season dictates the high movers. The product range covers thousands of items including hardware, plumbing fittings, paint, outdoor and camping gear, fishing tackle, homewares, electrical goods and gas supply equipment.”

The ability to serve the public as a one-stop-shop for all home and outdoor needs helps to promote repeat business. Consumers, many of whom have only a day or a weekend to spend in the area, are increasingly eager to purchase all their hardware and related household items at one time.

As most consumer-focused retailers will acknowledge, there is a need to administer and manage stock lists and client accounts with precision, and Peter has found that older computer systems can still achieve admirable results.

“We run three POS terminals and another one for the office,” says Peter. “The current system, called Retail Master, is DOS-based, and we are looking to upgrade to a Windows-based program. But the current system is excellent and extremely fast.”

Expansion

The size of Dunsborough Hardware is dictated by its location. Peter says that physical expansion of the store area is not viable, so existing staff numbers are also likely to remain stable.

“We employ four permanent staff to accompany the two owners, and there is also a junior,” he says, “but if the store size and staff base are relatively fixed, we do have ideas to expand the product range.”

Power tools take up a large amount of merchandising space at Dunsborough Makit Hardware & Home Centre

Peter insists that the store must change with the times to accommodate new product lines as soon as they become available. This means that he and Margaret have to be particularly attentive to customer feedback about industry innovations. With transient customers from as far afield as Perth and other WA urban centres, there is always demand for the latest fish hook, electrical item or timber stain.

Being a CPS member helps to keep the business up-to-date with new product launches, however customer enquiries are the best guide to “what’s hot” in the marketplace.

“We listen to the market needs,” says Peter, “which is something we can do because of our size and personal attention to customers. The nature of the industry very much requires a hands-on approach from us to our customers. Competition is everywhere and you must be seen to be in tune with what is happening.”

Good industry knowledge, however, is not enough to secure long-term profitability. As Peter admits, CPS membership, advertising and all the marketing tools in the world are not enough in themselves to attract customers.

“Store presentation, staff presentation, good communication and the ability to change with the times are the greatest challenges to modern hardware stores,” he says. “We make an effort to be more than just a nuts-and-bolts hardware store. We offer a wide variety of product that is attractive to the broader market, and we strive to reach a point where people want to come into the store. They must feel comfortable in their surrounds and welcome to look around and ask questions.”

Peter sums up his store philosophy as follows: “We work on our ‘Three Ps’—Presentation, Presentation and last of all Price.”

Written by John Power