Paul Nicholson Pools Resources Of Specialty Retailers

EUGENE, OR—From the grocery industry to the world of selling bikes, independent businesspeople know the public rarely understands that their level of service and products is superior to that of mass merchants.

Paul Nicholson, owner of Paul's Bicycle Way of Life, hopes to change that.

Nicholson formed Unique Eugene with other local specialty retailers. The nonprofit group's mission is to boost consumer awareness of the benefits of patronizing independent retailers.

Using their strength in numbers, 12 Unique Eugene retailers get quantity pricing on advertising rates, share their hard-earned customer bases, their varied knowledge and other resources.

"I thought that if I could find an effective way to tell my story I wouldn't have a problem. My bike shop is totally above the level of mass stores, and if I have the opportunity to briefly explain the benefits or quality service, consumers understand this and appreciate it," Nicholson said.

Unique Eugene's basic objectives include:

Raising customer awareness of

specialty retailers and their

contribution to the community.

Improving advertising efficiency.

Improving service and profitability

through shared business strategies.

"I thought of forming a group with other service-oriented retailers for cost-effective advertising. We have found some remarkable buys. For example, we are now paying $3 a spot for cable day-time spots," Nicholson said

"We bought a large number of 60-second spots. We made a high-quality video wrap for Unique Eugene TV ads in which we run three advertisements. Then we rotate participants, putting each store's ad in this high-quality format, which would be very expensive if done individually," he said.

A similar strategy is employed for local print and radio media.

Posters advertising Unique Eugene and Unique Eugene gift certificates have been popular, member retailers said. The certificates are good at any member store.



Do The Math. As with the success of Nicholson's four bike shops, the success of Unique Eugene did not happen haphazardly. In college Nicholson studied mathematics, which continues to pay off.

"For my stores I do a very extensive business plan. Anyone with management responsibilities has all their time budgeted exactly.

"First I analyze our staff resources—what is the maximum profitability we can achieve without overextending ourselves or compromising customer service? We find exceeding the planned budget is as serious a problem as not meeting it," he said.

While topping expected earnings may be great in the short term, it also could be symptomatic of future business ills, such as employee burnout or decreased business due to poor customer service, he said.

Nicholson budgets 23 percent of sales for salaries. When wages are paid and some of this 23 percent remains, money is distributed through bonuses. And come springtime staff members reap the benefits of profit sharing. As a result, his employees stick around.

What this all adds up to is something even the numerically challenged can understand: double-digit growth in sales and profits for 16 years running.

Nicholson expanded his bike shop to four locations when he realied the benefits of greater buying power superseded his attachment to the single-store intimacy and individuality.

With Unique Eugene, he and his local business partners have the best of both worlds.

Gavin McComas, proprietor of Sundance Natural Foods, said many of his customers are appreciative of the Unique Eugene stance.



Strict Membership. Just as a unified collective can uplift, it also can drag an individual's reputation through the mud, so membership requirements in Unique Eugene are stringent.

Besides being locally owned and operated with an established reputation, Unique Eugene applicants must have proven track records of exceptional employee compensation, environmental consciousness and community service.

"The concept is to share the goodwill of our customer bases. We recently turned down a couple businesses because they haven't had time to establish that. It would not be sincere to our customers to bring on something we didn't know to be justified," Nicholson said.

The Sum Is Greater. . .Teaming up with other retailers under a nonprofit umbrella provides perks beyond inexpensive advertising and co-promotions. A independent retailer can pay Eugene's visitor convention center $150 to distribute its flyers. A nonprofit group like Unique Eugene—with its 12 members—can join for $60 and reap the same benefits.

"We are trying to do things that are low maintenance. And once you set these things in motion they generally work for you at low level of input.

"Another example is the ad guy that works for us. He knows how to match businesses for group ads. For example, running the Birkenstock store with the lawn and garden store is a good match because their customer demographics are similar.

"Few individual stores can afford an independent ad producer, but collectively we can get some real expertise," Nicholson said.



More Math. It's true that a counter-culture town like Eugene may be more receptive to the message of the independent retailer than other U.S. cities. But similar groups are popping up nationwide. Specialty retailers in Boulder, Colorado, and Maui, Hawaii, recently teamed up offering customers loyalty incentives in the form of frequent shopper cards .

"There is no reason why people shouldn't form common-cause groups. The underlying subtext of the Unique Eugene campaign is that our city is a different and more interesting place. And businesses are a part of that. I think that message resonates in other cities around the country," he said.