Pricing is a major factor in the profitability of any retailer. Price items too high, and your customers will turn elsewhere; mark items too low, and you’re out of business. Understanding the elements of pricing for an optimal profit margin is the formula for retail success, according to Stephen Huttie, owner of Crown Retail Consultants in Wooster.
Crown Retail Consultants assists retailers with business plans, profit planning, merchandise planning, marketing and advertising.
A retail management veteran, Huttie started his consulting business after a 25-year stint with the J.C. Penney Co. He was so successful with one of his clients — the 117-year old H. Freedlander Co. department store in downtown Wooster — the store’s owners hired Huttie as president and CEO in February.
“I did some consulting for the company,” he explains. “Stanley Gault, one of the store’s principals, called me back and said they needed someone to run the store. I told him I was busy running my own company. Mr. Gault said to me, ‘Steve, I’m 75 years old and doing three or four things, can’t you do two or three?'”
One of Gault’s goals for the store is to keep it in Wooster’s downtown area a feat many stores have been unable to accomplish in a world of strip malls and superstores.
Freedlander is an institution in Wayne County, according to Huttie. With more than 75,000 square feet and services such as free gift-wrapping, free local delivery and an on-site tailor, Huttie says the store will continue to be a success.
“We’re putting the fundamentals back into the Freedlander business,” he says. “We’re going toe-to-toe and we’re competitive with the big guys. I think that’s why Mr. Gault liked me so much, because I actually worked for people who worked for James Cash Penney himself. I’m trying to run the Freedlander Company in that tradition with old fashioned values.”
A recent sale event at Freedlander was reminiscent for Huttie of his first J. C. Penney store in a small, rural town in central Pennsylvania.
“We used to crank the awnings down and wave to the farmers at seven in the morning,” Huttie says. “When we ran our sale the other day, it was like the old days with people banging on the doors to get in.”
In an upcoming seminar Huttie is teaching at Kent State University Stark Campus, he will share his on the fundamentals of retail pricing.
“In addition to the cost of the merchandise, you have to look at the entire operation of the business,” he says. “Retail pricing has to consider other things within the business environment.”
Salary costs often have the largest impact on pricing, Huttie notes, along with inventory turnover, shipping and freight charges, initial mark-ups from vendors, and advertising and marketing costs.
Huttie’s “Retail Pricing Seminar” will take place April 25 from 8 a.m. to 11 a.m. at Kent State University’s Stark Campus.
For more information or to register for the seminar, contact The Ohio Small Business Development Center at Kent State University Stark Campus, (330) 244-3279. How to reach: Crown Retail Consultants, (330) 345-2394; H. Freedlander Co., (330) 262-4010.