| The battle between the mass merchandisers and the | | | | local business and economic growth. The small |
| small Mom/Pop retailer is a race to identify and fill | | | | manufacturer often can not fill orders in the millions of |
| trends before they become big in a specific industry. | | | | dollars unless there is heavy investment in retooling |
| Here's the difference between how a small business | | | | and availability of capital at reasonable terms. |
| entrepreneur picks and chooses what is or will | | | | Especially in the U.S. where the labor costs are high |
| become popular and how a mass merchandiser does | | | | the popular items go offshore to less costly land, labor |
| it. | | | | and legal liability areas. |
| The small entrepreneur does not have the capital, in | | | | A case in point. |
| money or labor, to follow what is hot in retail, gardening | | | | In the early 2000's one of the hottest items to emerge |
| or home decor. Once items become most desirable | | | | in home decor and retail were the live bamboo shoots |
| then the mass merchandiser has started buying the | | | | that were placed in clear glass vases. Initially the item |
| items by the container load and it's often from | | | | itself lacked much appeal other than in landscaping, |
| overseas, outside the U.S. As items manufactured | | | | indoor plant areas as a fill in. After several popular |
| locally become popular it becomes a matter of | | | | mass appeal home decorating magazines featured the |
| commerce to go to China, Taiwan, or S.E. Asia and | | | | bamboo plants in their publications it became a home |
| duplicate them. Often the reproduction will be in the | | | | decorating trend to include the plants in home decor |
| millions of each and the price will drop for the knock | | | | design. The small business had ventured into the items |
| offs. That process is created by the perceived | | | | for a trial product, or had seen the items in the |
| demand of the general public's wants going forward. | | | | magazines and anticipated the demand. The small |
| The process of "anticipation" is predicated upon looking | | | | business owner started meeting the demand with the |
| at small niches and extrapolating the small niches to | | | | limited inventory available for their customers. After the |
| the masses. If the item has merit for mass appeal then | | | | bamboo became hot then the growing of those |
| the mass merchandiser bets with future purchases | | | | bamboo shoots shifted from the local nursery supplier |
| and orders the items in larger quantities. Prices drop | | | | to the mass producers and harvesters overseas. |
| but the mass merchandiser is always the dog chasing | | | | Rather than fill an order for 50 plants, which the local |
| the tail. | | | | nursery could do for multiple vendors, it became fill 2 |
| The small business entrepreneur is in a different boat. | | | | orders for 2,000,000 each of bamboo shoots. |
| The small merchandiser is often a one or two person | | | | The small business owner recognized and set the |
| buying group who own the business. Approximately | | | | trend, but the local grower and small business owners |
| 3-6 months prior to receiving the merchandise they go | | | | lose out when the items become popular. They can no |
| to merchandise shows in Atlanta, Las Vegas, NYC, | | | | longer buy or produce in the quantities needed and out |
| Philadelphia or in local communities to see what is new | | | | of necessity have to move on to the next trend |
| and novel. It is now the orders are placed for future | | | | hoping to get it correct in their purchasing decisions. |
| delivery. Most small business people are buying | | | | As bad as the economics sound there are multiple |
| Christmas items in the summer, Fall merchandise in the | | | | reasons to support local business and local |
| winter, etc. Due to limited capital the small business | | | | manufacturers. Here are a few of those reasons: |
| owner will "guess" on popularity of merchandise and | | | | - Local business recognizes local tastes & interest well |
| place small orders for their shops. A typical order may | | | | in advance of mass merchandisers |
| be $100 - $1,000 for merchandise the entrepreneur | | | | - Local business buys from local U.S. based businesses |
| thinks will sell and be what the customer wants once it | | | | and increase employment |
| is displayed. | | | | - Local business encourages innovation and leading |
| If the item is popular and sells immediately there is | | | | design |
| usually a delay before the items can be replaced. | | | | - Local business add to the economic base as they |
| Some of the items chosen do not sell and on those | | | | are paying local property taxes, municipal and other |
| the entrepreneur now has what is referred to as | | | | taxes the foreign company is not. |
| "dead inventory". That is cash spent with no return as | | | | - Local business employs local families whether kids |
| well as lost opportunity to buy what is hot due to lack | | | | looking for a first job, part time employment to help |
| of cash invested in bad inventory. | | | | families make ends meet, or employment close to |
| It's just a fact of life for the small entrepreneur, but it's | | | | home or school. |
| the lifeblood of retail. The small business owner | | | | The backbone of American industry is built upon the |
| supports the manufacturing of small lot, local | | | | guts of entrepreneurship that the U.S. citizens display |
| manufacturers and stokes the economic flames of | | | | constantly. |