I think it’s safe to say that we all remember the jingle, “I don’t wanna grow up. I’m a Toys R Us kid…” For many of us, that commercial embodied our childhood. We wanted to stay young and play with toys as long as possible, live carefree and laugh. For over 70 years, Geoffrey the Giraffe was that symbol to children, and parents, everywhere that we could in fact be a kid – or a kid at heart – forever.
Well, this week, Toys R Us reveled that it is closing it’s doors worldwide. As parents are trying to figure out where they will buy the next Black Panther toys and economists are speculating what caused the demise of the retail giant and what it will mean moving forward, how about how it will affect you as a small business? What lessons can we learn from the rise and fall of a company that was such a staple in many of our communities? Well, here are a few:
3 Ways Toys R Us Caused Their Own Downfall
There are 3 major ways that Toys R Us caused their downfall. Hopefully, as small businesses, we can avoid the same fate as we continue to grow.
- The High Cost of Debt: One of the major problems that Toys R Us faced was the massive amount of debt they had accumulated. They had millions of dollars of debt which means that any profit that obtained had to go towards paying on the debt instead of reinvesting in the upkeep and innovation of their business.
- Innovation was Too Little, Too Late: Apparently, the company had several ideas on ways to bring in new customers and an influx of income, but they waited too late to begin to see the need to do this and implement. Now, the company will not be able to act on these ideas because their days are numbered.
- Outsourcing What Should Have Been an Inside Job: In August 2009, they signed a 10 year agreement with Amazon, then a new company, for online fulfillment and customer service. This caused TRU to forgo developing its own online order fulfillment and increased the need for them to rely solely on Amazon. Of course we know that Amazon is now the worldwide leader of online shopping.
We all know that hindsight is 20/20, right? It’s easy to look back and see ALL the mistakes that were made, but how can we avoid those mistakes before they happen to us?
4 Ways to Grow Your Business, Learning From The Mistakes of Toys R Us
- Customer Service Matters: Many small toy businesses were able to survive and even thrive as TRU was seeing sales drop. Many of them attribute that to offering great customer service. Being able to answer customer questions, knowing the products, allowing children (and parents) to play with the toys before they purchase them all helped increase the customer service and allow them to stay afloat. Focus on the Customer.
- Be More Open to Innovation Than Fad: Having the latest, hottest new toy may be awesome to bring new customers in your doors, but many of those family owned businesses didn’t focus on that. They focused on making the overall experience fun for the children and simplified for the parents. These companies incorporated things like accepting Venmo, delivering toys, having playrooms, and other things that brought more value to them AND the customer.
- Stick With The Basics: No matter how much you grow, don’t forget the basics of business and customer service. Make sure you always survey your customers to find out what it is that they want and need. Focus on the customer.
- Keep Debt Low: It’s almost unavoidable to go into debt when starting a business, but keeping the debt as low as possible will decrease the chances that you will have an insurmountable mountain of bills that will hinder you from being innovative in your business.
These are just a few ways that we can keep our doors open and keep our customers happy. Always think about how you can service your customers in different ways. Be innovative in the way you get your message out there and how you educated your clients on new products and services that you offer. Even in sharing the products and services that you already offer, remember that there is a lot of noise, so you’ll need to stand out from the rest. Look into new ways to elevate your expertise and get more clients.
Podcasting as a Way to Elevate Your Expertise and Increase Client Touch Points
One great way to keep yourself and your business in the forefront of the minds of your patients, clients, and customers is to share content and valuable information with them. Because so many people are always on-the-go, podcasting can be a great way to connect with them while they are going about their day.
If you are interested in learning the basics of podcasting, sign up for my FREE Intro to Podcasting 7 Day eCourse!! In just 7 short days, you’ll learn what you need to begin your very own show to showcase your business and give more value to your audience.
Sign up for this course today and be podcasting by next week!
I guess it’s time to grow up after all, huhn??
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