By Leo Valiquette - Sunday, June 28th, 2009

Murray and Linda Greenberg, owners of Capital City Luggage on Wellington Street West, have endured their share of challenges over almost 25 years in business, but a clear focus on the fundamentals of sound cash-flow management, customer service and consistent self-promotion has kept the till ringing.

In 1980, Murray left the construction and renovation industry and went to work with his uncle, who operated the Town Cobbler, a shoe and luggage repair business with nine local locations. When Murray’s uncle sold the business in 1986, the Greenbergs struck out on their own and founded Capital City Luggage.

Murray made the leap into business ownership without the benefit of any formal training or experience beyond what he had picked up from working with his uncle. But while he will modestly shrug off his role in the Capital City Luggage’s success as a case of “flying by the seat of my pants,” the business’s longevity has clearly stemmed from a firm focus on the fundamentals.

Adapt to the market

In the early years, Capital City Luggage served as a repair center for all the major airlines and department stores in Ottawa and the surrounding area. But as times changed and a number of airlines folded, the business was forced to change and adapt. While it still offers repair services, retail now drives 85 to 90 per cent of Capital City Luggage’s business.

Adaptability has been key. Murray says the ability to change and adjust, or lack thereof, has made the difference between success and failure for the neighbouring shops he has seen come and go over the years. Formal training and education in how to run a business, while valuable, is no guarantee of success.

Know your customer

For any retail business, Murray says, the key is having a well-defined profile of your target customer.

“When we set out to expand the retail side of the business, we had to consider what audience we were going to target,” says Murray. “Whether it’s based on age, income level or travel habits, we had to be sure we were providing the right product lines, price points and services that would cater to their specific tastes and preferences.”

And answering these questions does not require costly and complicated market research and demographic analysis, he adds. “All it takes is just paying attention to what people are looking or ask for when they come into the store.”

Pay as you go

Throughout the challenges of shifting markets and repositioning the business around retail, the Greenbergs maintained a strict pay-as-you-go philosophy. Early on, Murray approached a bank for financing but was turned down. From that moment on, he vowed never to go back and instead relied on stringent cash-flow management to support the business.

“We’ve always operated this business on the principle of living within your means,” he says. “Don’t spend what you haven’t got.”

Regularly promote

Murray is also a firm believer in a program of regular and consistent advertising to promote the business and maintain consumer awareness. For years, print advertising in local newspapers was sufficient. But as time wore on and newspapers faced more competition from television and the Internet, Capital City Luggage saw less return from the investment, despite trying different approaches such as providing cut-out coupons or engaging in hard-sell campaigns with time-limited offers.

The Greenbergs responded by transitioning to advertising on local television and have been pleased by the results.

“You have to promote your business and make sure the dollars you’re spending are getting results,” Murray says. “On a regular basis step back and take a hard look at what you’re doing and whether or not it is bringing business in the door. If not, stop doing it and try something else.”

Fresh challenges

In recent years, the Wellington West area has undergone a dramatic facelift that has seen what was once a tired old neighbourhood revitalized into a vibrant retail strip with plenty of character.

But while this kind of transition can boost a retail area by attracting a whole new audience of shoppers from other parts of the city, it does come with short-term challenges that can, and have, driven many businesses into the grave.

The street is in the midst of a three-year construction project that causes traffic jams and makes it difficult for visitors to find parking or even a particular store. Capital City Luggage responded to this challenge in a number of ways, starting with its window display.

“Few stores put much effort into an effective front window display any more,” says Murray. “But for us it made a huge difference.”

The store embraced the construction theme with a series of attractive window displays developed by a relative with relevant experience. Not only did this pull in shoppers, it also brought in the construction workers themselves.

Offering outstanding customer service has been more important than ever. Capital City Luggage gave up its reserved staff parking out back to customers, while staff went the extra mile to assist customers navigate the street disruption and carry out purchases out to their car. Staff members have even parked customers’ cars for them.

“It’s simple,” says Murray. “Treat customers like human beings. Treat them like you would like to be treated yourself.”

Despite the construction headaches, business remains strong, and while the Greenbergs can attribute this to their efforts to promote the business and ensure the customer is well served, Murray feels it also comes from having been a part of the community for so long.

“There is a sense of community here,” he says. “Residents in the area want to support local business.”

Category: Case Studies.
Industry: Retail
Functional Area: Marketing
Tags: advertising, customer relations, customer service, inventory management, Promotion, Retail