The Container Store would love to, in Kip’s words, “hit the triple crown every day—offering a well-edited, carefully curated collection of 10,000 products, free expert advice and service that customers delight in, and prices competitive with the mass merchants.” But they can’t.
Most of the products sold in The Container Store are either proprietary or exclusive. This truly requires a strong vendor/retailer relationship where The Container Store needs to understand how these vendors define success so that everyone wins.
he company culture at The Container Store is based upon communicating everything with everyone. Employees, according to Kip Tindell, feel included when everything is communicated with them. Kip delivers the same updates to the company’s board of directors as he does to employees. The only topic that’s off limits are salaries, everything else is discussable.
“At The Container Store, we don’t immediately try to sell something to a customer; we can’t, because we don’t know enough about her yet. We simply start a conversation first, to open the door a bit, and earn her trust so we can begin exploring how to help her.” – Kip Tindell
Astonishingly, full-time employees at The Container Store receive close to 300 hours of paid training in their first year. Read that again… nearly 300 hours of paid training. Not 30 hours but 300 hours. Part-time employees get almost 200 hours of training and no employee gets put on the sales floor without first receiving 40 hours of training.
Finding great employees isn’t easy for any business. It helps to have the reputation The Container Store has to attract great employees. Many people want to work there, but less than 3.0% of the people who apply to become front-line employees at The Container Store get hired. Once hired, people rarely leave. The Container Store enjoys an unheard of store-level employee turnover rate of less than 10%.
Customers that feel abused from nickel and diming practices might do business with you once and only once. Stringing together bad profit one-night stands with customers is sure to come back to haunt your business and lead to unprofitable relationships which will undermine the long-term success of your business.
For word of mouth to happen, someone needs to gain some knowledge from either personal experience, or through conversations, or directly from the brand. The best way to deliver word of mouth information is through stories.
Retail operators know better than anyone that the people you hire are the most important part of your business. Your competitors can replicate your products and programs but they cannot replicate your people. It’s your people who live and breathe your company culture.
The following story is real. It was implemented in the Summer of 2001 in all North American Starbucks stores and was widely credited as a hallmark customer interaction program that is still talked about today as an example of a great customer experience program.