Fall 2007

Sister Stores

Dual Use

Eryen LaLonde, owner of The Auracle, sees it happening all the time. When mothers drop off their children at a birthday party at The Auracle’s pottery studio, they drift over to the attached gift shop and browse through its offerings. The Auracle, in Southington, CT, is an example of a “dual-use” gift shop, where one part of the store’s floor is devoted to a more service-oriented experience—a pottery studio, a tea parlor or a floral-arrangement business—while the other houses an associated gift shop.

Bob Negan, president of WhizBang! Training, a retail-consulting firm in Grand Haven, MI, says dual-use gift shops have an opportunity to increase the number of transactions per customer. “It’s one of the model’s biggest advantages,” he says.

Doug Fleener, president and managing partner of Dynamic Experiences Group, a retail-consulting firm in Lexington, MA, also sees in this retail model a way of capturing more revenue per customer. “Too often, retailers get so focused on what they sell that they miss the opportunities to figure out whom to sell to,” Fleener says. Neither Negan nor Fleener sees too many disadvantages with the operational model of such a store, although Fleener worries that some stores might end up confusing the consumer about their missions. “If the retailer doesn’t link the two operations into a unified approach, then consumers will struggle to understand what the store is about. What looks clear to us retailers isn’t always clear to the customer,” he says.

Fleener recommends linking the two businesses into one entity. “As an example, a tea parlor would specialize in gifts geared towards tea drinkers, et cetera. This doesn’t mean they don’t have a lot of other types of gift items, but there is a clearer link between the two,” he says.

Staffing two separate entities might be a challenge, but there is very little that good training can’t overcome, Negan says. Fleener says that one mistake retailers sometimes make is trying to save on staffing and not hiring enough for either side. “I see this in restaurants that also put in a gift store. When the restaurant is busy, the gift shop is undermanned, which costs sales, because when the restaurant is busy is the best opportunity for the gift shop,” he says.

While starting out as dual-use might be a conscious decision for some, Fleener sees it as a way for retailers to expand their opportunities in the marketplace. Some might start out with the service business and add a gift section; others might start out as a gift shop and add the service component later. In all cases, it’s a way of driving down costs and increasing profits by selling to the customer in more ways than one.