Jim Inglis is a veteran in the retail home improvement space. Working his way from the shop floor to the C-Suite, he has a unique understanding of the industry to offer. On this episode of The Voice of Retail podcast, I sit down with Jim to talk about his career, his new book titled ‘Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything,’ and how a certain amount of chaos is healthy.
Welcome to the The Voice of Retail , I’m your host Michael LeBlanc, and this podcast is brought to you in conjunction with Retail Council of Canada.
Jim Inglis is a veteran in the retail home improvement space. Working his way from the shop floor to the C-Suite, he has a unique understanding of the industry to offer.
On this episode of The Voice of Retail podcast, I sit down with Jim to talk about his career, his new book titled ‘Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything,’ and how a certain amount of chaos is healthy.
Using his career and the history of Home Depot as blueprints, Jim offers his leadership tools and insights on company culture to retailers that are looking to remain competitive and relevant in changing times.
Thanks for tuning into today’s episode of The Voice of Retail. Be sure to subscribe to the podcast so you don’t miss out on the latest episodes, industry news, and insights. If you enjoyed this episode please consider leaving a rating and review, as it really helps us grow so that we can continue getting amazing guests on the show.
I’m your host Michael LeBlanc, President of M.E. LeBlanc & Company, and if you’re looking for more content, or want to chat follow me on LinkedIn, or visit my website meleblanc.co!
Until next time, stay safe and have a great week!
Michael LeBlanc is the Founder & President of M.E. LeBlanc & Company Inc and a Senior Advisor to Retail Council of Canada as part of his advisory and consulting practice. He brings 25+ years of brand/retail/marketing & eCommerce leadership experience, and has been on the front lines of retail industry change for his entire career. Michael is the producer and host of a network of leading podcasts including Canada’s top retail industry podcast, The Voice of Retail, plus Global E-Commerce Tech Talks and The Food Professor with Dr. Sylvain Charlebois. You can learn more about Michael here or on LinkedIn.
Jim Inglis is a world-renowned expert with sixty years of experience in the retail home-improvement industry. He served in executive positions with The Home Depot for thirteen years, where he held the titles of Vice President of Merchandising, West Coast; Executive Vice President of Merchandising; and Executive Vice President, Strategic Development. He also served as a member of the Corporate Board of Directors. Currently, he serves as President of Inglis Retailing. He is also the author of Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything.
Inglis has helped shape the industry worldwide as a special adviser to the boards of leading home-improvement retailers across the globe: Sodimac in Santiago, Chile; Hornbach in Bornheim, Germany; Bunnings Warehouse in Melbourne, Australia; and Komeri in Niigata, Japan. He is also a past member of numerous boards of directors including for: Home World in Tianjin, China, Chamberlain Manufacturing, K&G, and the National Kitchen and Bath Association, among others. In 2015, he was honored with the Lifetime Achievement Award from the Global Home Improvement Network and the European DIY Retail Association.
Michael LeBlanc 00:04
Welcome to The Voice of Retail, I'm your host Michael LeBlanc, and this podcast is brought to you in conjunction with Retail Council of Canada. Jim Inglis is a veteran in the retail home improvement space. Working his way up from the shop floor to the C-Suite, he has a unique understanding of the industry to offer.
On this episode of The Voice of Retail podcast, I sit down with Jim to talk about his career, his new book titled 'Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything,' and how a certain amount of chaos is healthy.
Using his career and the history of Home Depot as blueprints, Jim offers his leadership tools and insights on company culture to retailers that are looking to remain competitive and relevant in fast changing times.
Jim Inglis 00:41
A certain amount of chaos is healthy, because it does create innovation and you know you mentioned Sears which is you know, a dead company because you know what they didn't innovate, you know. You want to read another good book is called ‘The Big Store’ and it tells the story of Sears they didn't innovate and they didn't have chaos, they got everything under control, everything managed, everything they cut they made sure those crazy buyers you know, simply were, were put in a, in, in handcuffs.
Michael LeBlanc 01:13
Let's listen in now.
Jim, welcome to The Voice of Retail podcast. How are you doing this morning?
Jim Inglis 01:18
I'm doing well. Thank you Michael.
Michael LeBlanc 01:19
Well, welcome. I'm very excited to have you on I've, I've, had an advanced copy of your book. It's a wakey tomb. Boy, it's, it's, I look through it and at first when I when, you know, I was thinking about um this interview and before I got the book, I'm like, okay, it's gonna be about a story about Home Depot. But it's so much more than that. This book is really, you know, really a, as I've described an operating manual for retail, so I'm keen to get into the discussion. Tell us, tell the listeners about your personal professional journey and your career and, and how you spend your time today.
Jim Inglis 01:52
I started my career in California, where, where I was born and raised. In 1961, I graduated from high school, and I needed a job, so I went to work at a local home center on the sales floor. About three years later, I married a lovely young lady who was a cashier, and we decided, boy, you know, we need to do something to advance our, our lifestyle, and I needed to go to college. So, I began working on my BA, and later my MBA, which took 10 years. During that time, I still worked at the store and ultimately became General Merchandise Manager of the company. So, by the time I graduated from my the university, I realized that this is what I really wanted to do. This is what I enjoyed doing, and wanted to you know spend the rest of my career in the retail home improvement business. So, I moved to one of the largest home centers on the West Coast, at that time was called Handyman. And then after five years, I moved to the largest, pro, building material company in California, which was Dixieline Lumber Company.
In 1983, I was invited to join The Home Depot, which was at that time had eight stores. Was just starting up in, in Atlanta, Georgia. And, I checked out with, I checked the vendors, I asked the vendors, I asked the trade journals about this company called Home Depot, and I was told, Stay away from those guys, it's all smoke and mirrors they're, they're, screwing up the whole industry, don't do it’.
But I, I visited the first the, the first store in Orlando, Florida, it was just being opened at that time. And I said, oh my goodness, this is something special, this is going to change the industry. And so, I did join Home Depot, and I spent 13 years there, and ultimately became Executive Vice President of Merchandising, and Executive Vice President Strategic Development.
I, I left the company in 1996, and for the last 20 years, I have been working with home centers all around the world, who would like to emulate Home Depot. Home centers in Europe, Japan, Latin America, Australia, and China. So that's, that was kind of my, my career, background. And today I continue to work with my clients and keep in keep in good touch with my past clients.
And, in addition to that, I serve on a committee with World Vision, where we work with manufacturers and distributors in the United States to redistribute excess product to the urban poor into natural disaster situations. And I serve on a board called, ‘Help the Persecuted’, which is designed to aid Christians that are in peril around the world. And I serve on an advisory Leadership Center at Palm Beach Atlantic University. And of course, for the last year and a half, my focus has been writing Breakthrough Retailing and spend spent a great deal of time putting this book together.
Michael LeBlanc 05:12
I mean you, how do you how do you fit in having dinner? My goodness, you're, you're pretty busy. I mean, it's interesting listening to your story, because for some, retail is an accidental career, you know, it's like they fell into it. For you, it seems more purposeful, you kind of fell in love with it, you know, right from the, from the shop floor and all the way up to the executive level.
Jim Inglis 05:33
Yeah well, you know, what whatever you, whatever you do, you get good at. With my 10 years of, of, you know, learning while I was going to school and working at the same time. You get good at something and then you, you find that after you if you're good at it, you find out that you well you love it.
Michael LeBlanc 05:51
What's interesting, the epiphany you had about Home Depot, because I remember those days, a little bit. And it's similar for some, the epiphany that they had in the early days for Amazon, I mean, the, the two things, you know, these, these category creating innovations, right, that aren't always seen as what they could be. But some people see through that which, which you did.
All right. Well, let's talk about this book, 'Breakthrough Retailing: How, a Bleeding Orange Culture Can Change Everything'. So, congratulations on writing a book, I mean, it's a big, big achievement. And, and first of all, let's talk about the book. How did you go about writing it? Why did you think there was a why did you want to write a book? And, and how did you think there was space on the shelves for, for what you had to say and, and writing just take me through some of your thought process about the book.
Jim Inglis 06:36
As, as you mentioned, it, it is a big book. It's over 400 pages. So, it's bigger than most business books.
Michael LeBlanc 06:45
It's not an air, it's not an airplane read, that's for sure, it's a.
Jim Inglis 06:49
It's a and, and basically, it's two books, it's two books in one. In fact, I, I was contacted by a Japanese company that said they would like to print the book in Japanese. But because of the type of print they have to use for the Japanese language, the book would be too big, we'd have to make it into two books.
So, but it is two books. And the first the first half of the book is the history of Home Depot. And I wrote that because I, I, think that certainly Home Depot's well known around the world, yet they're really not understood. I mean, why, why is Home Depot the largest home center in the world? Why are they the dominant player? Why are they the most profitable home center in the industry? Well, there's a reason and I don't think that reason is understood. So, I, I, I think there was something to talk about there.
The second, and, and, and really the, the, the, the magic elixir there, is of course, the fact that Home Depot was the innovator in the industry. But, but also an even more important was the was the culture, the bleeding orange culture, that, that was developed because of the servant leadership of, of the management team. So, that's the first half of the book.
The second half of, of, 'Breakthrough Retailing' is the principles of high productivity retailing. And, and what that evolved from is that for the last 20 years, I've been educating the middle management staff of all these different home centers around the world. And we would bring groups of, of their management to Atlanta, for week long workshops. Well, those workshops, developed a, a curriculum, that basically became the last 10 chapters of this book. So, so it's really two books in one, it's the history of Home Depot, looking at it from the standpoint of the Home Depot culture. And secondly, taking my workshop notes from the past 20 years on how to develop high, high productivity retailing, and developing that into 10 principles and then and then making each of those principles a chapter in the book.
Michael LeBlanc 09:02
Well, and I think you're being a bit humble about the book because I saw it in three, as three, three parts, actually three books, and maybe the first one, you know, certainly the history of Home Depot, but also the history of retail. Like it, Home Depot played this pivotal point. And retail changed so much that I, I got that's what I got out of it as well, like I was thinking of it in three ways. Home Depot, retail, and then as you said this, this, I guess I call it this operating manual.
Jim Inglis 09:26
Yeah, well, Michael you're right. You know, today you think, you know, they talk about disruptors and Amazon is a disrupter. Well, if you go back to 1980, Home Depot was a direct disrupter.
Michael LeBlanc 09:38
It sure was, I mean I, it's a here's a funny story. I was I had a construction business after I got out of university and I always say if Home Depot would have been around when I had my construction business, I might still be in the construction business. Because it, it was so hard during the day. And you know in the evenings, you're working hard to go find parts and the pieces that you need to finish the jobs, back then, right when you just had, you know, nine to five supply depots.
Alright, well, let's get into the book now. You know, what's interesting to me about Home Depot, is, is they've got, you know, they're category creating, and they've got a history of ups and downs not unlike other retailers. I mean, if I think of Sears, you know, they created innovations, and they were the most powerful retail in the world, 30 years ago. But not everyone lasts, right there’s kind of ebbs and flows and, and you know, including Home Depot, which went through a pretty kind of low period and some pretty tough times, but they came out of it. And what was interesting, is you telling the story about how they came out of it, take us through a little bit of the origin story, you've talked about the origin story, but take us a little bit, you know, through the history of, of Home Depot, the focus on, you know, these big milestones and important points of what, what we shop today and what we know today of the Home Depot.
Jim Inglis 10:54
Well, and as I mentioned, Home Depot's first full year of business was 1980. And at that time, there were 32 Regional Home Centers across the United States that were fed through wholesale distribution. And basically, were convenience stores for the DIY customer. The professional customers shopped at lumber yards. And the largest building material retailer in the world was Lowe's.
What Home Depot brought to the market in, in 1980, was a big box format. The idea of direct purchasing and not purchasing through multistep distribution. And focusing on gross profit dollars instead of gross parts profit margins, which allowed them to operate on a, on a, much more efficient model of business and bring much better value to the customer.
We, it took us basically 20 years to get into every market in the United States. And during that time, we made two acquisitions, we made in the mid 80s, we made the Bowater acquisition, which was eight stores in the Mid-South of the, not Mid-South, but the Southwest United States. And, and of course, in the mid-90s, we purchased Aikenhead which was in Canada. And then in the late 90s, we, I after I left the Home Depot, the Home Depot entered into Chile and, and Argentina.
And by the, by the year 2000, the original founders of the company, Bernie Marcus and Arthur Blank, had left the company and Bob Nardelli came on board from the General Electric Company. And that was a dramatic change in company policy. And in company organization. It was a, it was a bad period because during that period, Home Depot stock did not, did not, the stock price of, stock did not go up the sales grew by new stores but not, not in a, in a comp growth manner. And this and, and, and really there was some question as to whether Home Depot needed to be broken up.
Michael LeBlanc 13:18
Let's, let's talk about the Nardelli era for a little bit since we're on it. I mean, it's that's the, in some ways, the most fascinating part of the HD story and, and your book, is, you know, and I want to peel that back a bit because we can kind of see what happened. And it's, it's, this interesting point for any company where the founders move off from the company and professional management moves in. Nardelli was a star at GE. I mean, he came in, I remember the day, actually I, I remember the day, you know, oh, my god, they got like one of the, you know, he was gonna be the guy. And it didn't work out that well. And I'm curious to hear your, your perspective, whether it was observing that period specifically, or observing many, many retailers? Is it a, is it a cultural issue? Is it someone who just didn't know enough about retail coming in at a such a senior level, and that's such a poignant important point? What do you think it you know, aside from Nardelli, and his, his particular time there, what do you think it is about that cultural transition? Because really, you talk a lot about culture, right? I mean, this is this is the culture that he, he tried. Did, did come in as an executive and just say, I'm gonna, I can just I gotta change everything because something's not working like, give me your perspectives on that?
Jim Inglis 14:30
It, it, it was, it was everything that you mentioned, it was it was both the cultural issue and simply the knowledge of the industry issue. Home Depot, as I mentioned, had a what we call the or a bleeding orange culture, and that culture was, was based on decentralization and delegation. It was based on empowering management at various levels of the company, right down to a department level at the store. The idea that you take ownership for your business. When you have 2000 stores spread across the country, you really need that kind of ownership at the local level, because you can't possibly be on top of everything that's happening in every store from a central location. Bob Nardelli came from General Electric, they make.
Michael LeBlanc 15:19
Command and control, command and control, right? Process, command and control.
Jim Inglis 15:20
That's right, they, they make, they make engines for airplanes. Well, you know, every airplane that takes off has to land. And you can't have any errors. And, and, and, you produce these, these, these engines in, in, a few factories that you can control. When you're running a retail business, you need to have people on the field making decisions, and, and you need to allow innovation. And innovation means you're going to have successes, and you're going to have mistakes. But under General Electric, you cannot have any mistakes. If you make mistakes, you get fired.
And so, and so the entire culture was just turned totally upside down from a decentralized company where people took ownership for their business, to a situation where, where it was totally managed from the top. And of course, what really made it even worse was that, at that time, the entire business world thought that Jack Welch, who was the CEO of GE was, you know,
Michael LeBlanc 16:24
Yeah, could do no wrong, could do no wrong, right.
Jim Inglis 16:27
And he had, he had one rule, and that rule overpowered every other rule in the company. And that is that every quarter, earnings per share will increase. So, if, if it looked like if you're in the second month of your quarter, and it looks like you're not going to hit your earnings, you raise your prices, without even checking the competition. Or, you start firing the most expensive people on your sales floor who are one of your most important assets. Or, you simply stop doing any maintenance because, you know, we need to force some money to the bottom line. And so, you go from being a customer centric company, to a Wall Street centric company. That's what happened at Home Depot.
Michael LeBlanc 17:09
Tell me about I, I want your thoughts on how, you know, we talk about how do you find the right balance between chaos and control? I mean, basically, a Home Depot as a decentralized, you know, it's pretty freewheeling, right? And how do you find that sweet spot? I remember the days, you know, I worked for Black & Decker, how do you find that sweet spot between allowing innovation, knowledge of the market, and just you know, customers having completely different experiences in completely different stores? And that kind of spins out into chaos? For some, how do you find that sweet spot.
Jim Inglis 17:43
It all starts with leadership. And it starts with leadership, setting the values, demonstrating the behavior, developing those stories, and telling those stories and retelling those stories. You have to educate your people as not just a how to do the job. But why, why the why of the decision. So, if you, if you educate them on the why, if they understand the principles, then most often they're going to make good decisions. In some cases, you know, there'll be mistakes and there will be a certain amount of chaos, but you know, what, a certain amount of chaos is healthy. Because it does create innovation and you know, you mentioned Sears, which is you know, a dead company, because you know what they didn't innovate.
You want to read another good book is called the 'Big Store'. And it tells the story of Sears, they didn't innovate. And they didn't have chaos, they got everything under control, everything managed, everything they cut, they made sure those crazy buyers, you know, simply were, were put in a in, in handcuffs. And they failed. And you know what you could you could take that same story and tell it about Woolworths, you can tell it about Kmart. You can tell it about Toys ”R” Us.
Michael LeBlanc 19:01
A&P, on and on.
Jim Inglis 19:05
You tell it about RadioShack, you can tell it about Sports Authority. All these companies, that started their niche in the market, that created their niche in the market, that became the largest in their market, all failed. And they failed because they put everything under control. And as a result, they never changed, they just kept opening the same stale store, over and over and over, until the customers got bored and quit shopping there.
Michael LeBlanc 19:30
And, and I bring up Sears for a particular reason other than it's, it's very illustrated from a size perspective, my, one of my other great podcasts partner Steve Dennis talk, he's an ex Sears executive and we often talk about on our podcast Remarkable Retail, why it takes a crisis for retailers to change. And Sears is a good example. I mean I asked him, you know, could you see Home Depot coming? Because you got a big brand. You got Craftsman, right? You got a big ownership of a tool category. And you got to you know, these companies are full of smart people. You know that right? Everybody you work with is really smart? How, how culturally do you not see it coming? Is it a frog in the water situation where, you know, the waters getting hot? How bad could it be? How, how much damage could they do? And then eventually you wake up and oh my god, they've taken all our market share in our business is in trouble is, is that your experience as you do this consulting and your experienced with, with other brands?
Jim Inglis 20:22
Yeah, that, that's, that's exactly the case is, you know, what happens is you go from, I, I see that many of these retail, in fact, the history of retailing is you go from a merchandising oriented company, that's focused on merchandising, and as a result there, and the team is in touch with their customers. And they're, they're, they're an innovative company, they're, they're looking for new ways to delight the customer. And then that evolves to an operational company. And operational company is concerned about making sure that each quarter, we don't surprise Wall Street and make sure that, you know, we don't make changes that are going to cause expenses that we have to, have to figure out how to manage this quarter. And, and so you, you, you evolve to a, a operations oriented company. And, and what happens is, is that the company becomes stale. As a result, as they keep opening stores, they get less and less return on investment. And so, at some point, the management says, you know what, we've got to reallocate these resources. And that's when you become a financially oriented company. After you're financially or in company and those resources are reallocated, those stores no longer exist. And, and, and you see that you see that pattern repeated in the history of retailing. Over and over and over. Sears being a classic example.
Michael LeBlanc 21:44
Yeah, yeah. So, let's, I don't want to dwell on the Nardelli era, but it is a kind of a pivotal point. I mean, I guess on the positive side, he did, I think, you correct me if I'm wrong, he, he did really bring forward the whole professional focus. Launch the professional side.
Jim Inglis 22:01
No, I don't think that's true. No, I don't think that's true.
Michael LeBlanc 21:04
No, okay.
Jim Inglis 22:04
No, the, the professional, the way that we got into the professional business. The first five years of Home Depot, we were DY, DIY oriented. When we opened California, which was the store started, the company started in 80, and 85, we open the stores in California. We had to compete with what at the time was called Home Club. Which was a very low margin type competitor. And we, at that point, changed our pricing policy to everyday low pricing. And found that, at that point, the customers, the pro customers, began to shop at our stores and not just buy commodity products, but buy total projects. And, by the end of 1985, Home Depot corporate, made the decision that we would now embrace the pro customer. Now, very frankly, we didn't make that announcement because it would have scared the hell out of, out of Wall Street. But we began to embrace the repair and remodel contractor.
Michael LeBlanc 23:12
Different entrances, different practical stuff right.
Jim Inglis 23:12
And, and, and, and yeah, and the, the secret to Home Depot's growth over the, and, and, and we in 19, by 1986, we were doing 30% of our business with the pro customer. The repair and remodel customer. And today it's probably approaching closer to 50%. What Nardelli did, which was absolutely wrong and stupid and, and, and detrimental to the company, is he didn't understand that the target customer was the repair and remodel customer. He thought it was new construction. And he went out and bought, I think it was something like $30 billion dollars’ worth of new construction wholesale business.
Michael LeBlanc 23:55
Now that's the part,
Jim Inglis 23:56
And he bought it two years before the whole market crashed. And new construction, I mean the man made the most blatant tactical, non-strategic error that you could possibly make. So Nardelli should not be credited with giving Home Depot the pro customer, we had the pro customer, we were growing our pro customer business. The right pro customer repair and remodel customer. It was then, it was his mistake of going after the new construction. That was that was totally out, out of step with the capability and with the opportunities of the Home Depot.
Michael LeBlanc 24:34
So, let's talk about how Home Depot came, bounced back, I mean powerhouse today. What was it that, and this doesn't always happen with retailers, sometimes they there's no coming back, there's no turning back? But Home Depot is not that story, what, what brought them back from the brink, not the brink, but you know, what brought them back from those years into what they are today? What if you could distill that down to a couple, three things, what was it?
Jim Inglis 24:59
Basically, it was that Home Depot lost the confidence of the investor community. What, what had happened is that Nardelli had, had negotiated an incredible salary package, an incredible bonus package and an incredible severance package.
Michael LeBlanc 25:15
Over $200 million dollars. Did, am I get that number right, like some astronomic model, right, like?
Jim Inglis 25:19
I can't even count that high, yet, for seven years, the stock languished. And so, the investor and community, said, you know what, there's this is, this is not right. How can this man be, be the highest paid executive and retail and, and not be giving the investors any benefit? And so, the board finally realized that they had to have this discussion with Nardelli, and they talked to Nardelli about, you know, how are we going to change this? And Nardelli said, ‘We're not going to change it, I'm leaving, because I've got a great severance package’. And he left, he left, you know, based on pressure from, in, from the board, which was getting pressure from the investor community.
Fortunately, fortunately for Home Depot, Frank Blake, had been hired by Nardelli, and he also came from General Electric, but prior to that he, he went from Home Depot to the United States Government to, to Home Depot. And he wasn't a retailer, he was, he was an attorney. He was a, he was a legal guy. And he was brought in to do a merger and acquisition. So, you know, you always think, well, you know, what, how's he going to turn this company around? And the answer is, Frank Blake was a great listener. If you ask anybody at Home Depot today, what do you think of Frank Blake? ‘Wonderful guy, love him, love him’. And what was great about him? ‘He listened. He always listened’. For you know, when you talked to Nardelli, he didn't listen, he told you what you needed to know. But when you talk to Frank Blake, he listened. And he listened to the people that, you know, said, look, here's what was happening before, here's what's happening now. And Frank took the initiative to get this company refocused on its core business.
The first thing he had to do was he had to sell all that new construction business that, because Nardelli was focusing outside the company, he was trying to focus outside the big box, the big orange box, with all these new wholesale businesses that didn't operate in the box. And Frank Blake refocused everything onto the big box. Everything came back into the big box.
Same thing on eCommerce. You know, Nardelli was right, in that he created an initiative to move forward very rapidly in eCommerce, there's probably one good thing he did. And he did it in the wrong way. He, he did it as a freestanding business that wasn't interconnected to the core big box store. Frank Blake, brought that back into the store and, and, and made an interconnected relationship with the store so that they became a, a very efficient Omni Channel retailer. So, Frank brought everything back, refocused on that core business. Got rid of all those businesses that were outside the big box, and then listened to the employees about how do you empower the people. How do you how do you educate them, and then, clearly define the mission, and then empower them to fulfill the mission. You know, the investors are very fortunate that, that it happened to be the right guy at the right time.
Michael LeBlanc 28:30
Yeah, what a, what a success story. All right, so I can't have you on the mic, without asking you about recent history, about the COVID era, the past 18 months. And, and it must be, you know, as in your role, with your experience, looking at what's gone on in the past 18 months. I want to zero in on, a question, around changes to retail that are just adaptations to an unusual period of time versus structural changes. And I'm wondering if you've been thinking about that I, I you know, for example, supply chain, right, right now we're in, in the midst of, you know, a supply chain that is, you know, jammed at every port. I mean, we read about it in the news every day. Is that something that people, that retailers should be thinking about changing, this just in time? You know, just in time, let's hope it arrives, well, let's source it from around the world and bring it in, because that seems like, again, back to that central question. What lessons should we learn as retailers from the COVID era?
Jim Inglis 29:27
Well, I, I have two grandsons that are in university today. In two, two universities a day majoring in Business. And I keep sending them memos, logistics, logistics, study logistics, look into logistics, pay attention to logistics. Because, you know logistics is, is going to be so important. I, I think what you're going to find is that, retailing in general, is going to diversify into many different formats. You see that for instance today in the, in the grocery chains, you have big box warehouses selling groceries, you have the dollar stores selling groceries, you have eCommerce selling groceries, you have specialty fresh food stores selling groceries. So, I think what's going to happen is continued diversification of retail.
But, within each of those niches, there will be one player in each of those niches, who, who understands technology, who invests in technology, and uses technology to outperform the others to do a better job of serving their customers. And whoever wins the technology war. And of course, logistics is a huge part of the technology. Whoever wins the logistic war in that niche, will become the dominant player. So, I think you will, I think you'll have more different niches, but fewer players in the niche.
Michael LeBlanc 30:55
And, and do you think that's been accelerated by the COVID era? I mean, some of what you say is certainly true in the before time. But do you think that this period is, has accelerated that aspect of being successful?
Jim Inglis 31:08
Well, I, I think, I think it's done two, it has accelerated, for instance, it's certainly accelerated, accelerated the whole digital marketing world. But it's accelerated it with a, with a, an outlier bump. What happened in 19, in, in 2020, is not the new norm going forward. But it had a huge impact on changing how, how companies are going to prioritize technology and prioritize logistics. But you know, a lot of people take this to a, a logical extreme and say, well, because of the COVID, the retail stores are dead, and eCommerce will rule the world. And that's just not true. It's not gonna happen. eCommerce,
Michael LeBlanc 31:53
Now, now if you were, if you were in the chair at, at Home Depot, round strategic sourcing and supply chain, would you be working hard to consolidate your vendors or expand your vendor base? I've heard both strategies, some retailers, right, less retailers more better relationships, when allocation discussions happen. I need more vendors, because then I got more choice. And I need to make more stuff where I can put it on a truck versus a boat. Would you be thinking about those kinds of decisions today?
Jim Inglis 32:19
Yeah, I, I think, yeah, I, I think you have to rethink your whole, your whole sourcing. I do not think that you bring all your sourcing back domestically, because, certainly in the United States, policies against free trade by the Trump administration were inane and stupid. And I think that the, that the same policies really are being followed by the Biden administration, which are also inane and stupid. And I think that, you know, if we want to improve the standard of living for everybody, both at home and around the world, we need to move to free trade. So, I, I am not, I'm not a person that thinks that we should put barriers up around our, our country and, and only source locally. I do think we have to be much more creative. And using what you just said, and think about diversification. Be able to play on a worldwide market, but with diversification that doesn't put all your eggs in one basket.
Michael LeBlanc 33:18
Right. All right, last question for you. Let's, let's get to the last section of the second section. This, this great 10 core principles. Now it's a bit of an unfair question. It's kind of like asking you which of your eight grandchildren you like the best. But if you could call it one or two of those core principles that are, I guess the day what I'm asking is, is are some of the core principles, table stakes? And are there principles in your mind and, and talk about which ones that are, you think sustainable, competitive advantage? I need to do these, but you gotta win. And you got to be different when you execute these core principles. How, how do you think about that?
Jim Inglis 33:54
There are probably two principles that I think are the most important. And in my experience working with many retailers around the world, I have found that it's very important and incredibly important to understand that merchandising is an art, not a science. And that the retail market changes so quickly and so rapidly, that it is absolutely critical that, that the merchandising group, and the company, have an intimate relation with their customer. That they, that they, don't just know about the customer, but they know the customer. They know the customer and have empathy for that customer. And that they have a, a, an attitude of delighting that customer, finding new ways to delight them, and have speed to market. I think speed to market, is going to be absolutely critical. Because our, our world is changing so quickly.
The principle that, that allows us to happen is principle 10. Which is what the whole book is about, which is culture drives performance. And that's, I didn't invent that term, that was a Peter Drucker term. Culture drives performance, and I said it earlier, but leadership sets values and demonstrates behavior, that creates a culture, that instills a commitment of mission driven goals and objectives, which creates extraordinary performance by ordinary people. Customers will come into your store and price will bring them in. But price alone will never, never create loyalty. What creates loyalty is great service, and great service is a result of a great culture, a customer centric culture.
Michael LeBlanc 35:44
Well, my guest is Jim Inglis. The book is 'Breakthrough Retailing: How a Bleeding Orange Culture Can Change Everything'. Jim, thanks so much for joining me on The Voice of Retail, it's just such a treat to, to hear your perspective on retail and, and such great book and, and I'll put a link in the show notes of, for where folks can pick the book up. It's available today. And, and once again, thanks for making the time to chit and chat with me about, about retails it was just a pile of fun. So, thanks so much.
Jim Inglis 36:09
Thank you, Michael, enjoyed it.
Michael LeBlanc 36:11
Thanks for tuning into today's episode of The Voice of Retail. Be sure and follow the podcast on Apple, Spotify or wherever you enjoy podcasts, so you don't miss out on the latest episodes, industry news, and insights. If you enjoyed this episode, please consider leaving a rating and review, as it really helps us grow, so that we continue to get amazing guests onto the show.
I'm your host Michael LeBlanc, President of M.E. LeBlanc & Company Inc. And if you're looking for more content or want to chat, follow me on LinkedIn, or visit my website at meleclanc.co. Until next time, stay safe. Have a great week.
SUMMARY KEYWORDS
home depot, retail, company, book, business, retailers, customer, culture, stores, world, sears, retailing, years, centers, inaudible, change, people, united states, logistics, home