The Steamboat Pilot & Today

The lead actors in the best street theater on Lincoln Avenue are the diners who frequent the sidewalk cafe.

A nationally recognized retailing expert said this week that an appealing shopping district is the equivalent of street theater Scott Day told an audience of 40 retailers here Monday that the sight of people dining al fresco on Lincoln Avenue sends a message, "This is a fun place to walk and shop." And that's important, he said, because 60 percent to 70 percent of retail sales are unplanned sales, and commercial districts that have the "wow factor" put shoppers in the right frame of mind.

"Your sidewalk dining says it's safe to get out of your car," Day said.

Day, a principal in San Antonio-based Urban Development Services, came to Steamboat for a family wedding and stayed a few extra days to work with local retailers at the behest of Main Street Steamboat Springs.

Alpine Bank's Ruth Dombrowski, chairwoman of Main Street's Economic Restructuring Committee, said her group seized the opportunity to have Day work with local retailers. The committee's goals include sharpening the skills of retailers to the mutual benefit of all businesses in the commercial district defined by Yampa Avenue, Lincoln and Oak streets.

"Our mission is to assist businesses with educational programs that will strengthen their businesses and sales," Dombrowski said. "In addition, (we want to) support them with challenges they will face with new retailers" coming into the market.

Before starting his consulting company, Day worked with small communities to strengthen their historic downtown shopping districts. He enjoyed a 17-year tenure with the Main Street Center at

the National Trust for Historic Preservation.

Before last week's public presentation, Day made "stealth" visits to area businesses and found much to admire, he said. Then, after a two-hour presentation Monday night, he made house calls Tuesday at a half-dozen businesses that had signed up for a more detailed critique.

The wow factor alone won't ensure retailing success, Day cautioned his audience. Successful retailers take full advantage of the latest software programs to understand the performance of every square foot and every item in their store.

"Merchandising is not just making it look good, but making it sell good," Day said, quoting his own retailing mentor. Day worked summers between semesters at the University of Wisconsin at Madison at an eclectic gift shop in Milwaukee called "Potpourri."

Even the newest employees at Potpourri were entrusted with a department of their own and given a great deal of responsibility for the success of their section within the larger store.

Day said he learned that success in retailing depends on how well a retailer uses the space in the store and how effective they are in making the most of their investment in inventory.

The challenge might be more difficult in Steamboat than in suburban Milwaukee.

"Being a retailer in Steamboat is not for your average bear in the woods," Day said. "You kind of have two peaks (in the year). That's much trickier."

Offering a quick overview of "Retailing 101," Day said retailers constantly should update three calculations necessary for success.

First, they must learn to track the number of times their investment in inventory turns over annually. And they have to become adept at tracking that figure for each item in inventory.

"It's important to call up your best- and worst-selling merchandise (on the computer screen) and walk out on the floor and understand why," each one performs as it does.

Second, they must learn to calculate their monthly "beginning of the month inventory," or BOM. Retailers who work this calculation will be able to predict how much inventory they need to achieve annual sales goals.

Finally, "stock to sales ratios" help retailers predict what portion of their inventory will sell through on the way to hitting annual targets.

Savvy retailers use these calculations to plan for the "open to buy" or the amount of stock necessary to form a good impression in customers' minds, Day said. They also use the calculations to anticipate markdowns in advance. That will allow them to maintain a fresh mix of products on their shelves and display fixtures.

The "art" of effective store design is the counterpart to the mathematical calculations that are the underpinnings to a successful retail store, Day said.

When planning a store that appeals to the target customers, all five senses must be taken into account, he said. Although the need to have a visually appealing store is obvious, the way a shop presents itself to customers' senses of smell and hearing also are critical.

"What you smell when you go into a store is very important," Day said. "A damp, musty smell can be a real barrier to sales."

On the other hand, the smell of freshly brewed coffee vented onto the street can be very inviting. Potpourri used to place its coffee machine strategically at the front of the store at customer's right, to invite them to begin their trip through the store in the desired direction.

Unobtrusive music is essential to putting customers at ease, Day said.

"When I walk into a store without any music playing, I feel like I'm being watched," Day said.

One of the biggest strengths of Steamboat retailers, as a group, is their effective use of product lighting in their stores, Day said.

Managing the temperature of different zones within a store is also important, Day said.

At Nike Town, corporate retailers make certain the ambient air temperature in their changing rooms is 6 degrees warmer than the temperature on the selling floor.

During a visit to Steamboat Art Company last week, Day counseled owners Will and Beth Bashan about how to most effectively display merchandise within the store's unusually deep retail floor.

Gesturing to the front of the store, which is filled with natural light bouncing off lightly stained hardwood floors, Beth Bashan observed, "A lot of people that come in the front door think this is the (entire) store. Then they discover, ‘Oh, there's another room, and there's another room.'"

Day praised the Bashans' floor layout for clever use of displays that are functional from all directions and subtly establish a rhythm as customers discover new areas of the store. He suggested they might move a large checkout island out of the middle of the floor to make jewelry displays along the west wall more inviting.

He advised the Bashans to reduce the height of some display cases and work toward creating a series of higher plateaus as they move through the store from front to back.

Day also praised the use of lighting in Steamboat Art Company, complimenting a display of throw pillows and dark rugs lit by halogen spotlights to make them stand out to the customer. He urged the Bashans to consider keeping lit light bulbs in floor and table lamps that are part of the merchandise offered by the store.

Day typically advises retailers to ramp their inventory up and down leading into and out of peak seasons.

Will Bashan said that approach doesn't work for his store as he balances his need to appeal to full-time residents while providing a product mix that stimulates sales among second-home owners and vacationers.

"I never take my inventory down," Bashan said. "I don't like the message it sends to the local population. And with current interest rates, there's very little incentive to having a stronger cash position."

It's all part of the art and the science of retailing in Steamboat's historic shopping district.

-- To reach Tom Ross call 871-4205

or e-mail tross@steamboatpilot.com