Local retailers find being online pays off

Though some businesses have been slow to go online, those that have say it's worth the investment

kleslie@thetribunenews.comOctober 21, 2013 

With the click of a mouse, customers can find almost anything online, from clothes to toys and party supplies.

It’s a lucrative business, as well: According to numbers released by the National Retail Association, e-commerce accounts for about 5.8 percent of all retail sales, earning roughly $65 million a year.

Yet many San Luis Obispo County business owners have been slow to jump into the online market, which could be affecting their ability to grow their businesses.

Though it directly accounts for only 5.8 percent of all sales, the Internet is still involved in nearly 50 percent of sales throughout the year, said Deborah Cash, executive director of the San Luis Obispo Downtown Association.

“One of the reasons small businesses are in decline is because they don’t have an Internet presence,” Cash said. “If retailers aren’t in on the search, they’re unlikely to be in on the sale.”

Many businesses are hesitant to move online because of the extra investment, both financially and time-wise, said Judith Bean, president of the Arroyo Grande and Grover Beach Chamber of Commerce.

“Especially with mom-and-pop stores, having a Web presence can seem like, ‘I’m already working 365 days a year, and now I have this website I have to deal with, too?’ ” she said. “There is definitely some resistance.”

The wild world of Facebook

For businesses that haven’t yet taken the plunge online, it can be daunting to start, Bean said.

“A little bit of information can be a scary idea. If they don’t have (website experience) then they can kind of spend hours and hours floundering, stuck to a website,” Bean said.

To combat this, Bean advises business owners to start small: a Facebook page is a “first step,” she said.

Western Flair, a Western-themed clothing boutique in Paso Robles, has had a Facebook page since before the physical store opened, store manager Whitney Lehnhoff said.

“Facebook gets the word out about your business better than anything else,” she said. “Once we started the Facebook page, people began to ‘like’ it, and the word started getting out that we were open in downtown Paso. … From there, everything spreads like wildfire.”

Lehnhoff said Western Flair uses Facebook to gauge what its customers like, as well as to post pictures of new products and conduct weekly giveaways. It can also do customer holds, which is more convenient for some shoppers, Lehnhoff said.

With 450 followers, Facebook accounts for approximately 45 percent of Western Flair’s sales right now, Lehnhoff said.

Even though Facebook has been working well for the business, she said, the business recently decided to create a website on which customers could buy their products more easily. The website is expected to be operating by the end of October.

The online game

Another business that took longer to tap the online market is one of San Luis Obispo’s oldest.

Tom’s Toys, on Higuera Street, has been a fixture downtown for 30 years, but it only recently launched an online store based out of its flagship location in Beverly Hills.

Manager Carlos Macios said the store’s website, www.tomstoysbeverlyhills.com, which launched the first week in September, has been doing well so far, though it is still a word-of-mouth effort.

“Most of the people who know about the website are people who have actually been in the store,” Macios said. “We’re not really doing a lot advertising or marketing wise.”

The draw for customers has always been the physicality of going in the store and seeing all of the nostalgic toys available, Macios said, which is part of the reason it has taken so long for the business to get an online component.

“Just the overall happiness when someone walks in and their face lights up,” Macios said. “You don’t really see stuff like that anywhere else. Stores like us are a thing of the past.”

The store has been doing well without an online presence, Macios said: Sales and revenues have continued to increase year over year, even with the arrival in town of new chain stores such as Target.

But now it is necessary to be online, even if just for the added customer convenience, he said.

“Before, they would have to call in to order items,” he said. “Now, it’s all there online.”

Tom’s Toys’ website offers customers the chance to order any of the store’s 12,000 products online — with the option for Amazon Prime users to get free shipping — as well as gives information on the business’ locations throughout California. It also offers an in-store pickup option.

Because it is still relatively new, Macios said he did not have any specific numbers on how being online will affect sales, though it is expected to increase them.

First at the party

Other local businesses that have grown online have the benefit of a few years of experience behind them.

Susan Schinsing, owner of Pismo Beach Party and Costume, said she first realized she needed to expand when she relocated her party supply business from Ukiah to Grover Beach in 2007.

Before that, she said she had noticed a growing number of customers going online to buy costumes, but they would all come into her shop unhappy with their purchases. It didn’t occur to her to expand until she moved.

“I realized that with so many years in the business, I could offer unique products online and that now our market would be the world,” she said.

Schinsing began with the retail store, at 911 W. Grand Ave., and an eBay store called Not Your Mother’s Party Store, before hiring a consultant to build a separate online store.

At first, she was met with resistance: “When we mentioned (we wanted) 3,000 items with a shopping cart, everyone rolled their eyes.” But now the website has been operational for seven years, and the extra investment has paid off, she said.

“Just like the retail, the online took a while to gradually improve,” Schinsing said. “As the items increased, so did sales. Even with the economic downturn, we are holding our own.”

Schinsing’s website showcases a page with information on the physical location, such as the address, phone number and hours, but it also has a link to the online shop in which customers can purchase party goods, including special costume accessory kits and nonlicensed products.

Because of the nonmainstream products she sells, Schinsing said she doesn’t have to compete with online retailers such as Amazon or Party City; customers come to her knowing they will get a product not available elsewhere. Online now generates about half of her sales, she said.

“It is a huge, time-consuming proposition with an online store, a shopping cart, etc.,” she said, “but (local businesses) need to have at least a simple website, and Facebook page at a minimum, and that can be done easily.”

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