Looking for a way to grow your business? If you sell products through traditional retail or wholesale channels, consider adding mail order to your operation--it's a low-overhead, relatively safe way to expand.
Ouidad in New York City is one example of a company that did just that. The hair salon was doing well in the mid-1980s, but growth was limited by a finite facility and market. At the same time, owner/stylist Ouidad and her husband and business partner, Peter Wise, noticed a trend among clients who were moving out of the area to want to keep buying the products Ouidad had developed for the salon.
"[With only a retail location,] you start hitting the ceiling as to how many dollars you can make without raising prices," Wise says. The solution was Ouidad Products Division, which ships products to consumers who order by phone, fax, mail, or over the Internet.
Wise says retailers expanding into mail order have an advantage over new businesses starting catalogs. "You know your customers; you know what they want. What you're doing is offering them another way to do business with you," Wise says. "Customers aren't in your store, but when they call on the phone, they have to get the feeling they're still dealing with the company they know."
Here are two lessons Wise learned along the way:
- Make it easy for customers to do business with you. Offer 24-hour ordering; contract with an independent order-taking service if 24-hour staffing isn't practical for you. Use toll-free numbers on your order lines.
- Listen to your customers. Wise was running monthly product specials until customer feedback made him realize people don't typically buy hair-care products every month, so he shifted his promotions to match the buying patterns of his customers.