Inventory. You have to have dialed in inventory. People do not want to wait. They don’t want to drive to your store, walk in, spend time searching for a product that is out of stock. Very negative experience. You have to have the proper stocks and a purchasing apparatus in place to ensure you’re getting exactly what you need in the proper quantities before that customer walks in your front door.
As part of my series about the “How To Create A Fantastic Retail Experience That Keeps Bringing Customers Back For More”, I had the pleasure of interviewing Jared Zabaldo.
He created the military uniform super store, USAMM, in 2005, following deployment to Iraq with the U.S. Army in 2004, and continues as its CEO to present day.
Since its inception, Zabaldo has guided USAMM from a small startup to a heavily relied upon military uniform military resource carrying more than 30,000 products in stock for all five branches of services including creating the EzRackbuilder platform — heavily utilized by U.S. military service people all over the world in assembling the uniforms.
Zabaldo graduated from Southern Oregon University in Ashland, Oregon, in 1994 with a B.S. in Business Administration with a Management emphasis, and subsequently attended Willamette University’s College of Law in Salem, Oregon for three years. He spent 12 years in military service.”
Thank you so much for joining us in this interview series! Before we dive in, our readers would love to “get to know you” a bit better. Can you tell us a bit about your ‘backstory’ and how you got started?
I’m an Army veteran and did a tour of Iraq in 2004. When I got back to America, I needed a few items to complete my uniform, and the typical mechanism for doing so is to simply visit what they call, “Clothing Sales,” on your military base. Where I happened to be located in the State of Oregon, though, at the time, this would have required me to drive approximately two-and-a-half hours north to Fort Lewis, Washington. Each way. Out of that inconvenience was born the idea for USAMM, wherein I would simply purchase the items online, and have them delivered right to my doorstep.
Can you share a story about the funniest mistake you made when you were first starting? Can you tell us what lessons or ‘takeaways’ you learned from that?
It would get a bit technical to share the granular detail of that mistake, but let’s just say I was carrying a product that required another product for it to be even remotely useful. It would be the equivalent of a cheeseburger store — if there were such a thing — carrying burgers, but no cheese. One uniform item was rendered completely useless without the other. And it was extremely embarrassing attempting to explain why we would carry one without the other to that customer. Major tap dancing on that phone call ensued, but ultimately, I just had to admit the error. What I learned, however, was that every mistake, whether it be an inventory error, such as that one, or some other order fulfillment problem, is actually an opportunity for you to win a customer. Because it’s at that point that a customer expects to get screwed or to have to endure some excruciating negotiation to simply get what was expected and paid for. I always tell our customer service team, “Just cut to the scene where the customer wins. The customer always wins, immediately.”
None of us are able to achieve success without some help along the way. Is there a particular person who you are grateful towards who helped get you to where you are? Can you share a story?
Our first two employees were absolutely essential to success. In the very early days, we were operating out of a nasty old furniture factory that had been built in 1908, I believe, and now a hundred-plus years later, had been converted into a multi-level storage unit facility. We were somehow getting power through some ingenuity. People — not to get too graphic — were using used gallon milk jugs as a restroom. No heat. Insufficient lighting. There are a ton of funny stories there that are really absurd. But those two guys always showed up for work, every day, and bought in hook line and sinker. I was working 140 hours a week the first four years of operation, but that first year, in that “facility,” it would have been a deal breaker had those two individuals not been there for me, day in, day out.
Is there a particular book, podcast, or film that made a significant impact on you? Can you share a story or explain why it resonated with you so much?
There was never a book or film, (and podcasts didn’t exist in 2005, as far as I recall), that assisted me. No media helped me at all. It was just a belief that in America, a good idea executed by a smart person, completely dedicated to the mission, can do anything, here. That was a lifetime of American experience before I even got to the big business build that had informed that belief. And then my extreme experience in Iraq, in 2004 was instrumental, as well. Working around the clock in dangerous conditions. Seven days a week. Once you experience something like that, you can do anything.
What do you think makes your company stand out? Can you share a story?
We take care of our customers. That’s the most important thing. That and a belief that “no” is a cop out. We make things happen. No, is not even an option. Ever.
Which tips would you recommend to your colleagues in your industry to help them to thrive and not “burn out”?
Well, I think to avoid burnout, you need balance in life. I worked, on average, 140 hours a week for the first four years of our business. I was an owner, and I had to do that. It was required of me. But as you are able to bring on help, it’s essential to move towards “balance.” Also, even as I was doing so, I always believed in balance for our employees. I strictly outlawed overtime. Not as a cost-saving measure, but as a forced mechanism to ensure my employees had balance in life. You don’t want to lose valuable people because you’ve abused them by demanding “everything for the business.” I don’t believe in that, and I think, for us, it has served us quite well.
Ok super. Now let’s jump to the main questions of our interview. The so-called “Retail Apocalypse” has been going on for about a decade. The Pandemic only made things much worse for retailers in general. While many retailers are struggling, some retailers, like Lululemon, Kroger, and Costco are quite profitable. Can you share a few lessons that other retailers can learn from the success of profitable retailers?
Well, you need to be creative. For every obstacle, there is a creative solution. And in that solution, you can really win. I see companies beating Amazon, in many ways, by offering same day deliveries from their retail store inventories. I’ve used that myself, and that’s ingenious. People are lazy. They like having things delivered right to your doorstep. So, you can diversify your offering, so to speak, by obtaining orders for your retail establishment in these ways. Also, the internet is lousy at performing services. What services can you offer, in your retail store, that can get humans through the turnstiles? We’ve done this in our business, and it works. Look at your customers and figure out what they need. It’s a challenge, but you’ve got to be creative and think outside the box. How can I reach my customers? That should be your focus.
Amazon is going to exert pressure on all of retail for the foreseeable future. New Direct-To-Consumer companies based in China are emerging that offer prices that are much cheaper than US and European brands. What would you advise retail companies and eCommerce companies, for them to be successful in the face of such strong competition?
Well, China is easy to beat. As a consumer, myself, I find the direct-from-China order fulfillment experience terrible. It takes too long. The products are oftentimes low quality. That’s easy to beat. The only real challenge is that these Chinese sellers confuse purchasers. Online buyers never realize they’re purchasing from China while they’re doing it. If they did, they’d almost never complete the transaction. I would push American businesses to demand online purchase fulfillment locations be identified through regulation in the ordering process. The government needs to regulate this and make these origins transparent before they place the order. That does not happen. You never realize you ordered from China (even via Amazon) until well after the online transaction. We need regulation to inform consumers at the point of the order that their order is coming from China. Or wherever. Facebook needs to combat this in its advertising campaigns, as well. Without help, in this way, it’s impossible to combat China, really. How is a local retail store going to inform millions of online purchasers that they are accidentally buying a lousy product from China? That’s a tall order. All they can do at the local level is push the “Buy Local” advantages, which are obvious.
Amazon, is a different beast. “Buy local,” needs to become a “thing.” Unless the government can regulate the tremendously negative impact that Amazon has on small businesses. Even competing for labor with Amazon is a massive problem. When Amazon has infinite resources to outbid small businesses struggling to survive, it’s hard to compete with Amazon. I really see the only avenue as adding significant in-store advantages to customers as opposed to two clicks on their phone app and next day delivery. That sounds bleak, and it is if you don’t get creative and proactive. Amazon is headed to the old mining system wherein everyone works for the mine, gets paid in mine tokens — good at only the mine store on the mine’s property. But hope is not lost. Small local stores need to cultivate the obvious advantages for their specific customers and build real relationships with those consumers wherein it almost becomes a “painful” experience for them to not spend their money with that local retailer with whom they have a real personal relationship.
What are the most common mistakes you have seen CEOs & founders make when they start a retail business? What can be done to avoid those errors?
The obvious ones. Not really solving a problem that exists. So many business ideas are just simply ill-conceived. Make sure you’re talking to people and thinking the concept through properly. Make sure your overhead and facility are proportional to the opportunity. Make sure the location makes sense. Make sure you have the capital to accommodate the “build” of the business and get it to the word of mouth stage. So many businesses don’t understand that it will take time to build relationships and get the word out. Even the greatest of ideas require time. That will take capital to pay the bills. And listen to your customers. Never become so chained to an idea that you’re not willing to flush the original idea, even partly, to pivot to the better idea that you’re learning from your customers. Or maybe you come up with a better idea than you had before. You have to be willing to flush the obsolete ideas for the better ones. That’s okay!
This might be intuitive, but I think it’s helpful to specifically articulate it. In your words, can you share a few reasons why great customer service and a great customer experience is essential for success in business in general and for retail in particular?
The truth is there is no “one” secret to being successful in business. The truth is you have to do so many things well. But the foundation for all of those things is always cultivating a positive customer experience, from beginning to end. With no customers, all those other problems you have to negotiate never even present themselves. There is no difference between retail and e-commerce, in my opinion, in that regard. Perhaps, though, it’s especially important for retail businesses to remember that because you need these customers to physically enter your establishment, as opposed to doing an internet search for that purchase. You have to build relationships with these retail customers through their experience. They have to look forward to the experience in a different way. So, the retail business has to have a hyper-focus on this customer experience.
We have all had times either in a store, or online, when we’ve had a very poor experience as a customer or user. If the importance of a good customer experience is so intuitive, and apparent, where is the disconnect? How is it that so many companies do not make this a priority?
It’s because they’re too focused on each transaction being some make or break, crucial profit and loss event that must work out for their sole benefit or they’re done. I think some people are just ill-equipped to be business owners. I’ve seen people I know get angry with what you might call unreasonable customers, as well. They’re just ill-equipped to operate a business. You have to have a long view on each interaction, and a belief that those transactions that end up as “losers” are outliers to the overall body of transactions. I’ve found, unequivocally, that taking care of customers does not result in being taken advantage of in the long view. Just the opposite, as a matter of fact. People have to absorb those outliers where net income may not result. But those are not important in the grand scheme of things. If you can’t get over that issue, you’ll have real problems. A business owner has to take a leap of faith that doing right by their customers will pan out on the profit and loss statement, in the end.
Can you share with us a story from your experience about a customer who was “Wowed” by the experience you provided?
It happens so frequently that I can’t recall any one event. Early on, I can recall making some sort of silly mistake with an order. Just one of those things that happens, unfortunately. In our business, though, many of our customers don’t have time for a problem to be fixed. They need the products we make and sell on a specific date or it’s useless. We found a way to get it to them the same day they reported the problem. It involved putting the product on a commercial airline — which was a big logistical thing to work out, post 9–11 — but we got it done and fixed the problem. It came at a massive expense for an order that probably would have netted us just a few dollars, before. But it didn’t matter. It was far more important to take care of this customer. We never worry about any one transaction’s net result on the profit and loss. It’s much more important to take care of the customer. Yes, the customer was absolutely dumbfounded. We love doing stuff like that. It’s too easy to cut to the scene where the customer wins.
That was an e-commerce example. But we routinely do the same things in our retail store. There are some customers that have unique needs and timelines. All you have to do is listen to what they need and solve any problems for them.
A fantastic retail experience isn’t just one specific thing. It can be a composite of many different subtle elements fused together. Can you help us break down and identify the different ingredients that come together to create a “fantastic retail experience”?
Well, when I walk into a store, if you’re going to get me to spend my money, you’re going to have to have compelling products that satisfy my needs. The environment is going to have to be practical and comfortable and tell me, “This is a company I can trust.” the people staffed there shouldn’t be overbearing, but genuinely helpful in nature. Nice. Available. Accommodating. And knowledgeable. It’s all common sense type stuff. If you can put yourself in your customers’ shoes, you can understand exactly the experience to cultivate.
Ok super. Here is the main question of our interview. Based on your experience and success, what are the five most important things one should know in order to create a fantastic retail experience that keeps bringing customers back for more? Please share a story or an example for each.
1 — Inventory. You have to have dialed in inventory. People do not want to wait. They don’t want to drive to your store, walk in, spend time searching for a product that is out of stock. Very negative experience. You have to have the proper stocks and a purchasing apparatus in place to ensure you’re getting exactly what you need in the proper quantities before that customer walks in your front door.
2 — Customer experience. Customers have to love every moment of their experience in your store.
3 — Employees. You have to have the “right” employees. Not all people are well-suited to work with customers. You have to find smart and conscientious employees, but it is absolutely essential that they are “nice.”
4 — Take care of those employees. Once you have great people, you have to keep them. Create an organization that values its employees every bit as much as those customers.
5 — Cash flow is science. You have to understand the “science” behind your cash flows. Businesses that have to carry inventory have to ensure the “lubricant” of their business is very well-managed. Cash and cash flow is the lubricant of your business. Manage it well.
Thank you for all of that. We are nearly done. Here is our final ‘meaty’ question. You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. 🙂
We need to make “buy local” a “thing.” If you live in Columbus, Ohio, for example, buying from local establishments right there in Columbus needs to provide extra value to the consumer. Purchases need to somehow become tied to the customer’s own best interest. “It’s better for me to get this thing, from a good local business.” That is crucial. Every customer needs to believe that. But you can’t force that into the purchasing process that any one consumer goes through. It’s incumbent upon retail establishments to actually provide an incredible experience with a personalized touch that wins those consumers over and makes it “painful” to spend their money elsewhere. If your business is located in Spokane, Austin, Tampa, or wherever, it’s your job to embrace your customers in creative and genuine ways that not only fulfill that purchasing need, but simultaneously builds a real relationship with that buyer. There is no one route to accomplishing that. The details are for each business owner to determine and execute. “Buy Local” needs to become a thing.
If there was a movement in this country that brought local businesses together, as some sort of powerful unit and that allowed consumers to just as easily purchase local as they can via the Amazon app, small retail businesses could thrive again.
How can our readers further follow your work?
This was very inspiring. Thank you so much for the time you spent with this!