How would you have handled this one?

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Good grief, Bob, the main reason RC's attracts the customers they do is that they are selling an expensive product that someone else is paying for (i.e. a lot of the diners are on expense accounts)and one that is 80% (?) tax deductable in most cases. My guess is that RC depends on business entertainment for its very existence. Everyone I know who's ever eaten at a RC did it on an expense account. The parallel I can draw here is to sell to interior designers who are buying for businesses. I know the designers we deal with are not as concerned about price as a customer who is paying with her own money.

A good example is the 40 or so images and framing we're providing for a large professional group's new location. The cost of this art (actually decorations)is going to be written off in a year and the professionals aren't actually buying the stuff. Their "leasing company", a company they formed to build their buildings and lease them to them is paying for the stuff, and, you guessed it, the leasing compay doesn't pay sales tax because they have a resale license. All in all, this stuff is going to cost the professionals about 40% less than what we sell it for. Here is an ideal situation for selling high end product. I'm sure more than a few highly successful shops actively persue this type of business. We do.

But not full tilt. We could employ an outside salesman to call on designers and leasing companies in our region to feed us jobs. If we were aggressive business people we'd do just that; but we aren't. We prefer a laid back model that lets the business come to us. We don't make make as much money as we could but we make enough and we're confortable with what we do. We're not hot shot marketers or salesmen and we don't aspire to be. We just hung out a shingle, sold a good product at a good price and let the business develope.

Everyone has to eat and every big business has to entertain and business entertainment is tax deductable, that's RC's key to success. If you want to succeed on RC's plan, cultivate designers who decorate for affluent businesses, people who're spending someone else's money for a product that's deductable. Warren
 
"I DON'T CARE WHAT THE OTHER GUY CHARGES...I KNOW WHAT IT'S WORTH."

We are profesionals in business. This is what I charge. If you want my product you will pay, if you do not you will move on. Done.


Sorry it's Friday.........
 
Warren, maybe RCs is an expense account based business, but the jewelry store I mentioned is not. How do they attract the right customers and get them to willignly pay what they ask? You really don't see haggily in the jewelry store. There is no "that much?" when you quote $100 for a complete custom frame job.

I'm still missing something?
 
This thread could be atext book example on what might be a part of our problem. We tend to get bogged down in minutae-the mundane.

FLASH FROM HEADQUARTERS

It's not about Ruth's Chris-It's about us. It's about what can we do as framers to become better businesspeople and make more money.

For goodness sakes-We don't need to dissect their business-we need to copy anything adaptable and it isn't limited to RC's. It is anybody that does anything well. Not everything someone else does has to work for us, and not everything someone else does needs to be copied exactly.

We are just looking for things that might be helpful. Everything doesn't need to be fresh and innovative-hardly anything in marketing is.

But, one great thing coming out if this is perception. Warren is convinced that RC deals with the expense account crowd. Through my research, not my opinion, I know differently. That's where our opinions (perceptions) get in the way of truth. I eat at RC's often and I don't write it off. Do some? Absolutely. Is this a Marketing Strategy? I think Sue would beg to disagree.

Who is their target audience? It's based on income and other demographics that are very, very similar to our target audience.

Quick poll? How many have eaten there? Why did you select that over Sizzler or other restaurant? This might give some insight into their marketing.

So far, we have had some interesting and defensive posts. But, only one has taken the time to attempt to identify anything that truly sets them apart-makes them an industry leader. This might be better done as a silent drill as oppossed to posts telling us what they do wrong or why it isn't applicable.

I'm just trying to share an exercise every B School does to help identify successful characteristics. trying to suggest it isn't helpful misses the whole point.

You use Industry Leaders because of that very fact-they excel in a given field. It's a tad myopic to think we can't learn from other's success.

As a piece of advice, I wouldn't use a local competitor. Sometimes it is hard to maintain objectivity. Plus, what's the point in comparing someone that may not be an Industry Leader?

A few years back, I was asked to participate on a panel of experts at WCAF. Hardly anyone knew who I was, but a bunch of Industry people thought I could carry my own with this group. It included Jay Goltz, Marc Bluestone, William Parker and Bruce Dale, then CEO of Aaron Bros. I know, I know what was I doing with these guys (I saaid the same thing, too)

But, each of our businesses was in the top 1% of sales volumes and we all had some formal business education. And here is the rub: One of us had only one store, one of us had two stores, one of us had 117 stores, one of us had 12 stores, one of us had a store in a commercial park, one of us was in downtown area, one of us was exclusively in regional malls, one was only in high end power centers and strip centers, two were in areas that defied description, one of us couponed to death, one of us advertised heavily, one of us promoted heavily to walk-in traffic.

In essence, we all did it differently. And nobody ever said the other guy was wrong or he was right. As we talked for about two hours before the panel, we exchanged ideas and shared and learned. It was great experience and I thought it should have been pay for view.

Not one of has changed uor philosophy or method because, but we all are friends and respect each other and our respective operations. I think there ought to be a lesson to learn here

[ 06-18-2004, 07:17 PM: Message edited by: Bob Carter ]
 
Well, Bob, being a non-contributor to this thread, I can only say that I see the marked differences in how everyone is responding to the challenge of building their business and taking notes from those who have shown success.

My one contribution at this point is to say that I have eaten at RC's one time in St. Louis. I took the woman I was dating at the time there to see if the commercials they were airing on TV at the time (and Rush Limbaugh's undying support of the restaurant chain) was true. It was.

But, I went in there with $110 in my pocket, we had no acoholic drinks with the meal, and I had to put the rest on a credit card before we left!! Needless to say it was a bit of a culture shock for this ol' country boy and his date!! But in Ruth's defense, the steak was tender enough to cut with a fork, so thick that I had to stretch to reach the top of it, and the service was flawless!

It was a culinary experience that I will long remember!?!?

Framerguy
 
Twice, both on expense accounts (someone elses).
We have two RC's in Jacksonville. One is in an urban riverfront highrise hotel, and the other is in a relatively small upscale suburban business park in the middle of a rather large resort community. They seem to have made excellent choices in locations. The urban site is within 10 minutes of most of the major downtown businesses...there's even a water taxi accross the river. The suburban location is within 10 minutes of some of the homes of the wealthiest people in north Florida, and equally close to both the PGA Tour HQ, the ATP Tour HQ, and 135 holes of resort golf (18 of which are aspiring to host the 5th major). In the adjacent building in this business park is a very upscale independent restaurant that makes RC's appear a bargain.
So location they got in spades. The only other RC that I know of is in the Embassy Suites next door to the World Congress Center in Atlanta...thats a pretty fair location as well.
 
Ok, I decided that I wouldn’t use a local company to so my research. I tried and tried to think of a company that I was unfamiliar with but was successful. I was having no luck thinking of one and started trying to find ANY company that would give me this type of information via Internet. I started looking at publicly traded company as they give a lot of information but it was too sterile to really get much use out of it.

That’s when I decided to use Ruth’s Chris Steakhouse. I haven’t ever heard of them and heck Bob said they share information. WOW. (insert boingy eyes smiley here). They share and share well.

I have read several articles on them. They are a private company but share everything except actual numbers but they don’t apply here anyway.

I learned tons. Here is a few clips’ of information I have learned and read \/

-They aren’t filthy stinking rich. They have struggled greatly sense Sep. 11th. This makes them a “homerun” to study, as most of us here are struggling right now too.

-When asked “How’s business” Bill Hyde (RC CEO) replies “Mine sucks!” Sound familiar?

-He claims that already his company has almost returned to pre 911 sales.

-"We have really great comfort foods. We are steak, potatoes and wine," boasts Roger Kaplan, vice president of operations. Best of all though, the 35-year-old chain doesn't rely on an expense account clientele like, say, Morton's and Smith & Wollensky. The majority of Ruth's Chris customers are nameless, if well-heeled, suburbanites who live or work near the restaurants.”

-I don’t fully understand this but I can speculate; When asked about RC’s decline and smaller chains like Rubys and Applebees etc growth Hyde responded with "Some are probably trading down, but we're fortunate because of our locations and our middle-class appeal,” What the heck does that mean????? I’m assuming he is just certain that because there will always be a middle-class and they well always want to be pampered. I don’t call 150$ for a meal for 2 “middle class”.

-Ok here is where it gets good. “Last spring, wanting to boost traffic and create trial, Hinson bought mailing lists and dispatched a $25 gift card to people who lived near a Ruth's Chris in 10 markets.” This tells me that I should just get over myself and just beg for business. Discounts are OK! As a sidenote they ad “,"A similar program, aimed at corporate clients, didn't do as well” They claim that they basically have given up on marketing to companies.

-During the down times they made a book for GM’s. It was basically Guerilla Marketing for RC’s. In it included “How to set up and man a booth at a bridal show.” How much would you give for a copy of that book? Ill start the bidding at $100.

-Although business is returning, they haven’t stopped marketing strongly. “One future adjustment will likely be a frequent-dining program. Once shunned among fine-dining restaurants, the programs have received serious attention since The Palm introduced one several years ago. So far, 65,000 people have signed on as members of the 837 Club, "We used to say, 'High-end steakhouses don't do that.' Well, why not?" says Hinson.” It sounds like they felt the same about frequent dining programs as we do about coupons. HMMMMM!

- These days, promotions are a smart tactic, says culinary consultant Dean Small, who works with full-service chains. "High-end steakhouses have to take items like fish and make them sexy," he says. Plastic frames anybody?

This post is long enough. I will ad, Bob you often make comments about framers discussing business is folly. However Ruth Fertel didn’t know the first thing about business or even restaurants when she bought Chris Steak House. Thanks for encouraging me to look into this company. I think later I will do some research on Bills Khakis. Like RC they charge like $90 for a pair of slacks. I bet they can teach me something too.
 
Cliff, I bet there is haggling in very up scale jewelry stores. It's probably more intense than you'd imagine. I once had to buy my daughter a stainless and gold lady's Rolex, and I got it from a pretty high end store. But I haggled and they dealt. I told 'um I could buy the watch from an outlet advertising in the Wall Street Journal and they met the price finding me an old clunker in the back room to use as a "trade in."

From my experience (my wife is into jewelry) my guess is that people who spend a lot for jewelry come to trust their jeweler to give them the best price and that they'd drop him in a heart beat if someone else offered the same piece for a lower price. Rich people didn't get rich being fools.

I've been thinking about Ruth's Chris and I came to the conclusion that their product isn't available generally anywhere else. There is no other place I know of that I can buy their product (a steak that'll melt in your mouth). My guess is that the RC'c of the framing industry are exclusive one off frame makers.

One thing to consider, RC's has an expensive product but it's nowhere as expensive as high end framing, overlooking the fact that it's consumed.

Bob, I think perception is very important, especially when coupled with value: percieved value. Generally consumers are hard to deceive for very long about value, especially those who can afford high ticket purchases. A good policy would be to strive to offer a quality product that's also a good value, win-win.
 
Hi Jay-See what I mean about info being available if we just look and ask? One thing you can rely upon, people, when proud of their efforts, will talk. Look no further than Warren amd myself. The key is finding what is applicable and which is adaptable?

Wally brings up a great example on location with RC. Bet the farm, they have the site selection process down pat. And, I'll bet that the rental charge comes up way after the site is defined.

I have a casual relationship with the restaurant biz, so RC's is a little more familiar to me. It does show with a simple attempt at research, you can dispel a lot of the self-imposed perceptions.

It is what Analysis is all about

I almost used Cadillac as an example, but I'll bet dinner on RC's that someone would tell me all the things they do wrong, and why only an idiot would spend that much for a car and all the other predictables.

The point is to look for what they do so well selling to a market that we wish we could sell to.

I often tell the story of our Competitive Shopping Program. We try and shop our competition at least twice a year. We always send out new employees to do it.

Because we never do anything for only one reason, we make the new kids go out. We lnow that most of them have no clue what framing costs and often that problem can get in the way of selling up. They feel "Man, this stuff is expensive" and sell down assuming that this is what the customers really want.

Once they get into the field, they realize our prices are competitive (Objective 1)

We see the new kids come back with nothing but negatives about our competition (You know, lousy service, no compelling designs, lousy looking stores). They do that, I'm sure, because they think that s what I want to hear. While a lot of that is true, it doesn't teach us anything (Objective 2). I want to know if they do something great, carry something special, offer a service we should.

If all I wanted was pricing, I could hire any HS kid, pay them $10 a store and they would bury me in numbers (Objective 3). But, I don't learn anything else.

This year we are doing "non-traditional" competition. The recent Trade Surveys tell us the consumers rate us (frame shops and galleries) low to very low in the recognition scale of where they go for framing and framed art.

What are these guys doing that so effectively robs our clientele? Who would have thought 5 years ago, that Shelter Stores woud be such a powerful force?

Well, they did.

It's all about Fair and Balanced Analysis of the Marketplace.

If we spend our efforts criticizing RC or any other vendor of choice, we miss an opportunity to learn and improve. So, it is with our own competition
 
Bob, I think perception is very important, especially when coupled with value: percieved value. Generally consumers are hard to deceive for very long about value, especially those who can afford high ticket purchases. A good policy would be to strive to offer a quality product that's also a good value, win-win.
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Warren, you hit the bull's eye with that statement. End of discussion.
:cool: Rick
 
Warren,

Michael's would not do it for $2.50. They have the precut standard sizes non archival mats in a few basic colors for $2.50.

When someone says something like that to me, I usually send them on their way (nicely, of course). The other day I priced out a 12x12 original pastel. I gave the customer the price, not particularly high, and she laughed at me. HL would do it for $30. I smiled sweetly, looked her in the eye and told her that I couldn't get anywhere close to that price, nor would I want to.

I do get tired of always trying to bottom price for people. I even told one lady we were wasting her time. She came in with 4 small photos. She didn't have the 5th one yet. We started a layout, but she couldn't see it without the 5th photo. Then she mentioned the candlesticks that this would be hanging next to. Then there was a piece of statuary that she wanted the mats to match and she would bring that with her next time. I kinda laughed and suggested that with all the missing information, we were wasting time. Maybe I was wrong, but I could just see it, next the wall color, the sofa fabrics, the drapes and on and on. Then my final price was going to be out of range.

I really do love my job!!! :D :D :D
 
Guys,
This has been a fun thread. But I have a question:
Is Ruth Chris' what used to be in Southern Calif
Chris'& Pitts BBQ??? I LOVED that place!!! And I couldn't even begin to afford it! But I had some friends who would FORCE me to go with them, and so they paid....
I've heard the adds here and I just love the place for the ads. We haven't gotten my wife to get herself up to a steak yet, so......

But judging by the ads, "we're a nice place for a great piece of meat with out the SNOB at the door."
It's kind of like our frame shop. Nationally recognized, award winning certified framing since 1978 in the same neighborhood. We have the Neighborhood framing, but offer the museum pieces too. (Closed corners, rag, silk,MusGlass). The customers eat it up. Oh, and did I mention that the 5 o'clock on the door happens when the key turns and not the other way around.
I talk to a lot of framers as a Rep in two states, and I hear a lot of "Burned out". The lady I work for when I retail was also one of those, but I just showed her that there could be some fun again even as we work into her 27th year.
A customer was in Saturday and we were doing anything to ignore the 18x59" fabric mat I was trying not to lay. We were having fun with her photo of her when she was 5 months old. Between the $1,000 over the top to the $64 simple frame, she went with the $359 very nice and classic look because in 30 years she will not have to do it again. (We're going to reframe her dads picture she framed at another place only 9 years ago.)
She said if she knew that framing could be such a fun experience, she would have been coming to us for the last 14 years she has lived in the neighborhood.
I hear a lot of crying the blues with the war, economy and such, but the things I seem to find with the framers who are BUSY, are Location, nice to high end framing, and the honestly gush about what a great job they have. They love their work, and their passion shows.
The ones I have seen cease to exsist, are retiring, or were bottom feeders. (If you market yourself as the cheapest, how do you sell up?)

Bob, I wish we had about 3-8 more hours to spend with you in your shop that day. I liked how your walls were JAMBED with art and examples. I think to often many of us try for that "gallery" look when what we are really using our walls for are examples of our work.
Len Aaron, of Aaron Brothers fame, once told me: 'that is not the floor that sells, it is the walls. That is the square footage to base your rent on. Windows displays to get them in, wall displays to get them buying."
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Getting back to RC and $150 for two. In November I took my wife to the Tour d'Argent (google it) to celibrate my recieving my MPF. Dinner was $587US. :eek: The wine was only $100. My wife said it the best: "it was magical". She will remember that night FOREVER.
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Worth every dollar. Can't wait to go again.
:D
baer
 
I tell you what we do in my shop. My archival
11 X 14 mats go for $8.75. That price includes the percentage of the mat they will be receiving plus a cutting fee for use of the wizard. If a Customer brings in their own mat (which i get alot of)...guess what...it's still $8.75. We are in the business of custom framing not the mat business. So whats mine is yours, and whats yours.. is well... yours.
 
Why is it that it appears that our industry is one that people think they can haggle with us? It's not a flea market.

-Mike. [/QB][/QUOTE]
I tell you what I do in my shop. An archival
11 x 14 mat runs $8.75. That price includes a percentage of the mat that they will be receiving, plus a cutting fee for the wizard. So when a customer brings in their mat (which I get all the time), guess what... its still $8.75. So whats mine is yours (for a price) ...and whats yours is...well...yours(for a price).
 
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