Young Upstarts

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The Impact Of Rising Inflation On Small Businesses

by Rohan Duggal, owner of Columbia Wine Company

The Year of 2018 has been like a different animal from a retailer’s prospective. It’s something I have never experienced before. Here’s what I’ve noticed thus far. People have increased their online ordering to an all time high.

People are more dependent on third party platforms to have items delivered to their homes, customers are more savvy than ever on purchasing, and loyalty has fallen off dramatically. One bad experience and it’s on to the next one for the purchaser. The customer demonstrates a lot of elements of the millenial shopper as they are fickle, shopping around for the best option, and willing to switch instantly.

It’s been a very difficult time to be a retailer in NYC with costs going up from the prospective of rents, from labor, and various expenses. It has led to a lot of dramatic changes for the small business owner on how to handle the landscape shift.

Here are some ways I’ve gone about adapting:

1. With the cost of wages going up I have to find ways to cut cost in my payroll. What have I done? I have outsourced non operational jobs to third parties. For instance my bookkeeping is now being done by a third party vendor which is at a fraction of the cost instead of having a full time bookkeeper. Also, I can’t be staffed the way I’d like to. With that-it requires giving more individuals in the shop more responsibility and training them to be multi-faceted which isn’t always the most productive output but will get the job done.

2. In the past I would buy top deals all the time. The benefit would lead to me getting the best pricing on goods but I’d have to commit an outlay of cash into inventory that would take months to get rid of. Instead of doing that I’m committing to a month’s worth of inventory and dealing with just making sure I’m able to keep my shop filled with goods that the customer is asking for at all times

3. I try to avoid salesmen if possible. Why? Well their goal is to upsell. I have procured a budget of what I want to spend and my goal is not to spend time being convinced of what items I may or may not need. My POS tells me what customers like, at what price point, and how much I need to buy. Unless I really need to speak to a salesmen I try to stick to placing ordering through an order board or via email.

4. Because the cost of the minimum wage has gone up it’s led to minimums increasing at the shop, along with the radius I can handle. I can no longer do 50 blocks as I once did. It’s now down to 20 blocks so I can handle the amount of orders that come in and my regulars in my radius get there goods at a reasonable time period.

5. Spending more time creating specials that are online based so people who are looking for deliveries will find me and try me out.

6. Raising prices ultimately on some goods that people just flat out want. It’s definitely led to people who shopped at my store to leave but what choice do I have? It’s either that or I won’t be able to facilitate my operating budget. It’s a fine line of raising prices, and swapping out material people are looking for and bringing in new product at price points they find favorable.

7. Emphasizing the best in house customer experience possible. However it can be done I’m trying to stand out to my shoppers so they keep coming back

Ultimately all these issues have led to a massive ceiling being put on the small business owners in NYC. Recently, however, I started using EpiFruit – a platform that connects businesses with delivery partners in the area. Because of it I’ve been able to lower my delivery minimums, deliver further distances, and ultimately increase my radius of deliveries and capture more customers. It’s been a great tool that’s allowing me to not only survive but thrive.

 

Rohan Duggal is the owner of Columbia Wine Company in NYC and the founder of the on-demand delivery platform EpiFruit, designed to help meet the growing needs of brick and mortar retailers struggling to keep their costs down and satisfy the ever-growing demands of customers. Duggal is a NY native and entrepreneur with over 12 years’ experience as a business owner in the retail sector from wine to general merchandise.

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