Specialty grill sales require knowledgeable sales staffs
Matt Bolch -- Casual Living, March 15, 2006
About three years ago, the seven-store Offenbacher's chain was ready to get out of the grill business, hit by declining margins and the similarity of goods between the specialty and mass distribution channels.
Electric grills like this one from Electri-Chef haven't fallen by the wayside, though charcoal and gas grills still reign.
Carrying built-in grills and islands, like this one from Lynx, allows retailers to differentiate themselves from mass merchants.
"We were ready to pull out," recalled Mark Ramos, general manager of the Lanham, Md.-based chain with stores in Maryland and Virginia. "The only reason we stayed in was because of the relationships we have with distributors and/or manufacturers. We got them to make some concessions so we could afford to keep carrying the products."
According to Casual Living's 2004 Universe Study, grill sales overall rose 5% between 2002–2004 to $3.2 billion. That's good news, right? It's good if you're a home improvement store or a mass merchant, where grill sales rose 17% and 8.7%, respectively. Together, these two distribution channels dominate the market with 68% of total purchases.
Grill sales through warehouse clubs rose 22.5% to $220 million, while sales through specialty stores decreased 16% to $252 million during the same period.
There's no doubt mass distribution channels dominate the low end of the market, but they are moving up in price by introducing more stainless steel. And while a little stainless steel makes no difference in the performance or durability of the product, try telling that to shoppers who are entranced by the shiny new grill stationed next to the pool toys or the garden hoes in the local DIY retailer or big box store.
Quality differences are there, for sure, but a knowledgeable sales staff is required at the specialty level to help customers translate those variations in price and quality into a value proposition that makes sense to them and prompts them to buy.
"I'm going to carry the highest quality that I can find," said John Miller, owner of Barefoot Casual Furniture, Miramar Beach, Fla. "I'm not going to downplay that with the grills." Miller was formerly manager of Ken Rash's Inc. in Memphis before moving back to his native state to open a casual furniture and grill store near Destin in the Florida Panhandle.
Miller compares the difference between a $600 grill and a $3,000 grill to the difference between driving a Yugo and a Mercedes. While the latter is a performance vehicle built for the long haul, the former is basically a throwaway.
Barefoot Casual carries charcoal grills from the Big Green Egg and Portable Kitchen, along with Broil King and Lynx in gas and Electri-Chef in, well, electric. Carrying built-in grills and islands also helps set the store apart from discounter rivals, Miller said.
Charcoal grills from Big Green Egg, top, and fryers from Masterbuilt, below, complement gas grills from companies like Star and Lynx at Ken Rash's retail store to keep a variety in stock for customers.
The owner builds display grills a little loose so the burners, flavor bars and other interior components can be removed easily. During the sales process, he points to the double-wall construction of each unit and has the customer lift the lid and heft the parts. He also asks where the customer expects to find parts for the discount store grill.
"I'm not going to try and sell anyone a grill they don't want," Miller said. "If that person walks, I tell him that I'll see him again in a couple of years when that cheap grill fails."
Miller's former store derives about one-third of its total sales from grills, said Mark Sitter, salesman at Ken Rash's. Sitter agreed customers have to be shown the differences among grills so they can see the value for themselves. Ken Rash's carries gas grills from FireMagic, Star and Lynx to complement charcoal grills from Big Green Egg, Portable Kitchen and Cajun Grill.
Offering natural gas grills for portable or permanent outdoor kitchens helps Ken Rash's stand above discounters, Sitter said. The store works with local contractors to build islands and features a built-in island in the showroom so customers can see the finished product.
Offenbacher's also capitalizes on natural gas installations, Ramos said. He added natural gas grill sales have quadrupled over the past three years. The chain carries charcoal units from Primo Grills and smokers and gas units from Broilmaster, FireMagic and the Vermont Castings Signature Series. Vermont Castings sells to mass merchants, but Ramos said the Signature Series offered to specialty retailers has proven popular with his customers.
To familiarize salespeople with the store's grill products before the season gets under way, Ramos brings in reps from the various grill manufacturers who explain the features and benefits of each product, present comparisons and give sales tips. Ramos also creates a chart on the back of signage for each grill model that highlights differences between Offenbacher's grills and those offered by mass merchants. That chart includes a price listing of the differences if the customer were to upgrade the lower-priced grill to the one offered at Offenbacher's.
"They'll buy value," Ramos said of customers. "We have higher value at a lower price over the long run."
Offenbacher's services what it sells, and grill prices in general include a cover and setup and delivery in the local service area. Ramos stressed that offering a little extra isn't a sales tactic but just the way Offenbacher's does business. And for customers who appreciate that difference, it's what sets specialty retailers apart from the big box stores.
"It's a good business to be in," said Ramos of the grill category. "The margins are not there, so you can't live off of it, but it's a good business."
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