Hard Times at H&H, Inc.

Hard times came to Haley & Heather, Inc., as they did to the rest of us, in September of the year 2001.

Haley, Heather, and their staff spent most of September 11 in front of the television set in the office. The shop was empty anyway, and who could be elsewhere on that day? They closed the store for a day during the next week out of respect for those more closely affected by the disaster. For two weeks they were simply numb and conducted their business like robots.

One morning, in the beginning of November, they sat down in the storeroom for a meeting with their accountant. Haley & Heather, Inc. is a beautiful sea-green, silver, and white gift store. The office is cluttered and busy. When Haley and Heather really want quiet and privacy, they retreat to a corner at the back of the storeroom where there are three chairs, a table, and . peace. That morning, peace seemed far away, but there was quiet, and a whole passel of facts and figures to consider.

Business had been okay - not wonderful, but okay. The trouble was that all Haley and Heather's buying projections were based on business being better than just okay. And, when Heather really took a look at the books, she could see that things had started to slow down before September. They had not met with their accountant in several months, and had missed the warning signals.

'I don't like this discussion,' said Haley to their accountant. 'Everyone all over the country is facing terrible problems and here we are talking about how to improve sales in one little gift store. It makes me feel small and uncomfortable.'

'Well, it is very simple,' said Mike, the accountant. 'If you don't do something about your cash flow you won't have a business to worry about. Then you can sit at home and feel patriotic. But think about it. Eight people make all or part of their living in this store. Two hundred and fifty vendors, a landlord, a window decorator, and a window washer count on your revenue every month as part of their living. I don't agree with Calvin Coolidge that the business of America is business, but business and the money it generates are what make the wheels go round. All the money being donated to good causes was made from business. So . fix your business!'

Haley and Heather felt better after Mike's lecture. 'I feel crisper somehow,' said Heather, 'almost as if I had been starched.'

The two owners made a plan. (Does that sound familiar?) Some of the items on the plan were about saving money and some were about enticing their customers to spend more.

Taking an Assessment

People liked to buy at Haley & Heather, Inc. because they could find unusual gifts arranged in unique ways. To increase sales, Haley and Heather began to focus on using their inventory more creatively rather than spending money for more inventory. Christmas business had started. People were feeling particularly patriotic, so Heather went through their ornament stock and pulled all the red, white, blue, gold, and silver ornaments for a tree display, and put it in the window. She wrapped all of the packages under the tree in either red paper tied with white ribbons, blue paper tied with white ribbons, or white paper tied with red ribbons. Then she made a display of the supporting merchandise inside the store.

Haley opened the boxes of July Fourth merchandise and took out all the tiny flags. Martha Lou, who worked at the wrap desk on Saturdays, took the flags home and made them into Christmas ornaments to sell at the store.

Heather planned a table display for a New Year's Eve party using red and silver merchandise. The centerpiece was a little red wagon filled with silver Christmas balls. The party hats, noisemakers, and confetti were silver. She tied the napkins with ink-blue grosgrain ribbon. The effect was patriotic and pretty.

Using Staff and Vendors

Creativity and thrift were the focus of the next staff meeting. Everyone was asked to make a list of ways to save money and boost sales. Rebecca thought of the best idea. She went through the store and made a list of every gift that was made in America. Then she used the computer to print tiny blue signs that said, 'Made in America.' She left information about these gifts on the lunchroom table, so that the staff could use it when talking to customers.

Haley was about to order new tote bags, but dreaded having to pay the resulting invoice. Instead, she ordered a big rubber H&H stamp, and had the staff stamp the store's initials on plain white bags using sea-green colored ink.

Mike had suggested that Haley and Heather prune their vendor list. 'You will cut your paperwork and save time if you use fewer sources,' he said. 'And those you do use will be loyal because their share of your business will be larger.' This part of the plan took a little longer to work, but it paid off in the end. H&H began to assess each new vendor to be sure that they offered enough to make it worth opening and maintaining an account.

Customer Service

Haley and Heather know that when times are hard one's customer base is one's most valuable asset. They are taking very good care of their customers these days. Bag stuffers go into every bag at Haley & Heather, Inc. Some of the stuffers offer personal consultation on gift giving. Some of them describe the H&H giftwrapping and delivery service. (Youthful seniors are a thrifty source of delivery drivers at H&H.) The most popular bag stuffer is the one that describes the Friday Fund, which resulted from all the folks at H&H wanting to give somehow to something. They voted to support the bipartisan Clinton and Dole effort to raise college money for the children of people who had been lost in the September disaster.

Haley and Heather decided to donate 5 percent of all sales made on Fridays to the Friday Fund. The staff pitched in by donating 5 percent of their Friday salaries. Haley made a big sign that told the story. So many people stopped to read and comment on the fund that she moved the sign to the store window. Haley and Heather could not believe how many people purchased their gifts on Fridays because they believed in the cause. The fund has become so popular that they and the staff have decided to continue it on the last Friday of each month for a year. On January 2, 2002, Haley and Heather will write their first huge check to The Families of Freedom Scholarship Fund.

Life can be beautiful.