Craig talks about the future of retail businesses in Detroit with Sarah Donnelly, Director of Retail Services for TechTown Detroit. As the city works to rebuild neighborhoods, attracting retailers is a big part of that effort...but traditional brick and mortar stores are dealing with a changing business climate. Sarah Donnelly talks about programs that are designed to help.
Craig talks about the future of retail businesses in Detroit with Sarah Donnelly, Director of Retail Services for TechTown Detroit. As the city works to rebuild neighborhoods, attracting retailers is a big part of that effort...but traditional brick and mortar stores are dealing with a changing business climate. Sarah Donnelly talks about programs that are designed to help.
The Craig volley show on deadline. Detroit is made possible in part by tech town Detroit, Detroit's entrepreneurship hub, TechTown Detroit as a business incubator and accelerator helping tech startups and local businesses launch and grow tech town sports businesses with coworking office meeting and event space. They also connect entrepreneurs to resources and learning and networking events in Detroit. TechTown Detroit, Detroit's entrepreneurship hub.
Speaker 2:[inaudible]
Speaker 3:Hey buddy. Happy Tuesday. Welcome to the Craig volley show on deadline. Detroit. Glad to have you with me today. Coming up on the show, we're going to talk about the future of retail here in Southeast Michigan. We've been hearing stories all over the place of the brick and mortar stores going under major chains, actually losing business and going out of business, but what is the future of retail, especially when so much neighborhood redevelopment planning depends on there being a healthy and vibrant retail scene. We'll talk to one organization that is making a change on the retail front here in Detroit that's coming up on the Craig Bali show on deadline Detroit, the Craig Follies show on deadline. Detroit is made possible in part by Samaritas, the state's largest private foster care and adoption agency. However, Samaritas also provides a number of other services around the state. They are one of the largest refugee resettlement agencies in Michigan. They serve homeless families, persons with disabilities, abused and trafficked women. They also provide market rate and affordable housing for seniors and HUD housing for families and also have skilled nursing memory care and rehab communities in grand Rapids, Cadillac and Saginaw. It's a meritocracy. We thank them for their support.
Speaker 2:Deb on the truck.
Speaker 3:Hey Greg here. Thanks for sticking around for the show today. I do appreciate it very much. Well, we,
Speaker 1:we talk a lot about neighborhood redevelopment planning here in the city. What's going to make some of these neighborhoods thrive again and one of the things that residents in neighborhoods told me consistently when I worked for the cities, they wanted to see more retail options in their neighborhood, but starting a retail business, especially a brick and mortar retail business is not that easy these days. We've seen all sorts of stories about major chains going under in a changing landscape. When it comes to retail and what's the impact of online sales and everything else? How do we make sure that there is a thriving retail scene that actually meets citizens needs, but also as good for entrepreneurs? Well, TechTown Detroit actually has a whole program for this. They have retail bootcamps among other things which we're going to learn a little bit more about today. My guest is Sarah Donnelley. She is the director of retail services for TechTown Detroit. She joins me right now. Welcome to the Craig volley show. Thanks for having me. Absolutely. Uh, let's start with this. Uh, the future of retail. There's been a lot of discussions about this in recent years as to how robust the retail economy is. We're hearing a lot of stories about, uh, you
Speaker 4:know, major stores closing all across the country, malls having all sorts of problems. It might be something that sort of scares people off of the idea of starting their own retail business. What is the status of brick and mortar right now? Brick and mortar is thriving. It's changing. It's going through its own, you know, transformation. I don't think brick and mortar retail is dying per se. I would say bad retail is dying. Um, you know, consumers just don't have the patience for things not being in stock or an experience being something they could have gotten online. So it needs to be personal, it needs to be custom. Um, and brick and mortar has a real opportunity to continue to be a place where people can connect with each other. And I think, um, in today's world that is really important. When you say bad retail, I mean how much of that is just changing tastes in terms of what people prefer and how much of that is just the bad practices? Sure. So, you know, people, people want what they want when they want it, you know, and, and online shopping has really democratized, you know, businesses availability to get started. Um, but the, again, that experience really needs to be personal to the consumer. So if things are out of stock at a store, being able to, you know, either find a replacement option to fill that need in the, in the immediacy or being able to order it for somebody. Have it shipped to their home, you know, convenience and service are ready. Um, I would say service, uh, is the last thing really to sell. Cause people can get anything anywhere. Well they, they can't. And I think that's the thing that's got a lot of people thinking that, that maybe this way of, of making a living in making a career is, is going the way of the Dodo. Um, I don't want to suggest that's the case. One thing I've noticed just, and this is totally anecdotal, is that the types of stores that seem to be thriving or something that's a little bit off the beaten path. You can't just try to sit there and, and you know, compete directly with some of these big online retailers and big retailers. You can't just open a basic shoe store anymore. Sure. You know, and um, you know, the larger scale chains, they're closing because they overbuilt, right. And they stopped investing in their people and their product is something you can get anywhere. Um, and so, you know, the best practices are well trained staff knowing how to read people and really creatively problem solve. That's really what, you know, sales is and retail is, um, people still want to have that tactile experience. What is something you feel like, tastes like, fit, like, you know, as a woman, what is this going to fit like that is really still very important. You know, and I think that Detroit, Margaret has a particular niche because we have so many great makers and creatives that are selling one of a kind products and brick and mortar is that great. Um, entry point for someone who, um, you know, wants to give that in person experience to the consumer. Well, you know, and Detroit in itself seems like a very strange market though because, you know, we are just no seeing the emergence of retail, especially in the downtown sector and in some of the neighborhoods that have been starved of this for a long time. So it seems as if there's at least some pent up public demand for this year. 100%. And you know, there have been businesses that have been open for decades that have been here when the spotlight wasn't on the city. So, um, the services that we provide at tech town, um, helps lift up those existing businesses and also, you know, connects the businesses that are looking to open right next door. How can we get them to work together and to collaborate. Again, retail has also the ability not only to offer the goods and services that people want, um, residents and visitors alike, but also has the employment opportunities as well. Not just the traditional retail salesperson, but social media and, um, you know, fashion designers. There's a lot of career paths that, you know, retail isn't traditionally connected with and the way that it's, um, you know, omni-channel both in, in the brick and mortar location and online and popups. There's just a tremendous amount of opportunity for creatives to see retail as a career opportunity. Well, I want to remind folks, my guest right now is Sarah Donnelley. She's the director of retail services here at tech town. We're talking about what's going on in retail and what's being done to actually help people get off the ground or support their existing business here in the community. Um, you mentioned, and let's just go to this because there is a lot of discussion in Detroit about Hey, there's all this work being done to get new people in. What about me? I've been here for a long time, been struggling and trying to make this work. Uh, how do you make sure that those people are feeling that they are a part of the solution as opposed to just all these newcomers coming in and trying something different? Yeah, so you know, there's a variety of services that we offer a tech town. Um, a lot of them are free, uh, low cost if any cost at all. Um, we have a pop up here that we host every single month called the shop at tech town. Um, we have onsite coaching for retailers. Um, and it could be someone that is, it's their very first retail popup and also they could be right next to the veteran that has a shop out in the city and they need access to that sales. Um, so we really pride ourselves on having resources that can be one day, one hour, um, you know, free. So retailers can get what they need when they need it. Right? So let's talk about merchandise and let's talk about, you know, marketing. Let's talk about sales. Um, again, the national chains are trying to appear more local, right? That's why Macy's has, uh, there, you know, local market and every, you know, city in the country. Um, we've helped some of the businesses here in the city get to those markets. Um, you know, Nordstrom's is trying to appear more local. Again, I love these chains, no knack, but that's where the competitive advantages of these local businesses, they are actually local. They know who shops with them. Um, and why not, uh, show that off. Does that resonate with customers? Do they care if something's local or as opposed to being part of a conglomerate? I think, you know, it depends on the consumer. Some, some care, some care about the story, some care, you know, if they know the person who makes it. Um, I would say predominantly first and foremost, people care if you know their name, you remember if they were there last month. Um, the person at the chain normally doesn't know that. Very true. That's true. You know, just, uh, I want to talk about coaching a little bit. You mentioned that you've got programs that are low cost or free for certain people. They can be short, they can be long for them. What typically do you find is the type of thing, uh, that owners are looking for in terms of getting better at their job, generating traffic, how to do it, um, how to write, right. And so, um, you know, again, how do you, how do you embrace the customers you currently have versus acquiring new ones? Um, you know, the larger scale, um, retailers are closing because they overbuilt. There are trying to do programming like events, um, you know, specialty trunk shows to drive traffic and these are practices that the micro retailers can adopt as well. Um, so it's sales, marketing, um, staffing. Maybe they're getting ready to hire for the first time. Um, and really how can we help them think about their business in multiple, multiple ways? Yes, it's generating traffic into their store. So how do you capitalize on that, whether it's five people walking in or one. Um, and then also how can you expand your reach digitally as well and doing pop up events. It's really a multipronged approach. Well, you know, you talked about the pop up shop that is here in tech town. I've seen it in action of I've spent a lot of time here at tech town over the last few months. How important is it to give somebody an opportunity to have a test run like that? You know, um, it's incredibly valuable. Yes, it's time that they have to dedicate, um, you know, to prepping for the event. Also the day of the event. Um, but you know, participating in something like the shop, you're getting one on one coaching throughout the day. We have a custom fixture library that we had designed by local fabricators and design firms. Again to how can we inspire, um, the retailer to think differently, not just a flat table, you know, in a black tablecloth. Let's get you vertical. Let's have you think about different combinations of fixtures. Again, we could, we've seen participants take what they've learned that day and they've applied it to all the other popups that they've done, which is, um, helping them in the long run. It seems that a lot of people will suggest that retail success is based on things like location, location. Then again, location, much like real estate. Um, you have a number of people who would like to open something up maybe in the neighborhood they grew up in or you know, where their friends live or something like that. Getting them to focus on the right location for what they're trying to do. Um, do you find yourselves at times having to say, Hey, I love what you're trying to do there. That's not the right fit right now. We pride ourselves on helping the business owner figure out their value system. What's most important to them, right? Is it, um, who their neighbors are, you know, in the commercial area? Is it the distance, you know, between their, you know, kid's school and where they live. Um, you know, is it, did they have more time to wait? Can they wait for a longer build out? Do they need to get in right away? Um, you know, in various various things like that. Um, but for a site selection, you know, no location is going to be 100% perfect, right? So we, you know, put through programs like retail bootcamp, um, that'll launch later this year. Um, through those 10 weeks. It's how to pick a location with an architect. How can design impact that decision making? How can it save them money, um, in, in the long run, right? Um, picking a location based on market data, um, you know, and then really, really recognizing, um, eventually you're going to have to make the leap, right? Um, what I'm really working with, um, this year is that how can we get developers to build spaces that are smaller, right? Um, businesses, these micro-businesses makers, designers, um, they can make a viable living in 500 square feet and a thousand square feet. Um, some of them, you know, they, what if they call located on a permanent basis, not just a pop up, right? Sure. It can be. Yeah. It can be sharing space, sharing space, you know, um, it can be a viable option longterm for them to get open faster cause they're combining resources, stay open, um, because they're, again, they're pooling their talents. Um, and then also for the residents and visitors, it's more attractive, right? Because they are saving them perhaps saving themselves time and convenience. Um, and having just a more dynamic, uh, shopping experience.
Speaker 1:Well, you know, looking at the space we're in right now, this is a coworking space as well as obviously a business incubator and everything else. I mean, are we seeing a move in retail towards having sort of co habitational space the way that offices are? You look at the companies like we work in tech town and some of the other places like this. Are we going to see more people doing sort of that rust belt market version like you see in Ferndale where you allow people to, okay, you have this little bit of space Eastern market's been doing it for right, or a hundred years. Right. And I love,
Speaker 4:I love when we work with businesses that, um, are, have been selling in Eastern market for years. Maybe they've been selling a Rustbelt, um, maybe they've been, you know, producing in Ponyride, um, and they're considering a retail storefront. You know, what does that mean?
Speaker 1:We're, we're seeing the mindset shift towards wanting to co-located, you know, permanently. I mean, we're seeing it in, in food as well, just down the street. The Fort street galley is a place like that. I mean, is that sort of the future? Not necessarily a mall, but one place that's got a bunch of different offerings that, uh, you know, and if you find the right vibe and the right types of vendors, you've got a viable space. That makes a lot more sense from a business standpoint as the building owner, right. From a, well, as the building owner, you have more tenants to manage. That's one thing, but again, you might have less turnover, right? And you might get it occupied quick, quicker. Um, I think that's, I think Columbus
Speaker 4:hitting is part of the future. I think another part of the future is, um, you know, places like Detroit denim where you've got the Makerspace in the back and retail on the front. Um, there's, that's a very old way of thinking about things. You know, it could be old way, it could be old is new. Again, it could be nostalgic. Um, but again, what can, what can consumers get, um, in person and not online, right? They want to see things that are custom, um, personal, um, and they can see the action. It's that retail theater, so to speak. Right? Um, it's 24 hour demo. It's happening right there. Um, and, and, and I don't want to lose sight of, besides co-locating and, and the, um, production space and retail combo. Um, you know, and again, it could be nostalgic, but nothing beats that, um, in person experience. Right? And when it's, when it's beautiful.
Speaker 1:Sarah Donnelley, my guest right now again of tech town, we're talking about the retail landscape, not just here in Detroit, but really what we're seeing trend wise, uh, across the country. Um, you mentioned something a moment ago that I want to go back to. You said it's talking about getting developers to recognize that smaller space might be better. Uh, that goes down to the negotiations you see from somebody like the DEGC with the developers. Is the city's trying to figure out what's going to go in certain locations. Do you have a foot in the door where you can insert yourselves into those conversations before these plants get started?
Speaker 4:We really, we enjoy, you know, we're a service provider for the motor city match program where we do some retail education. I'm on that site selection with an attorney and architect. We talk about visual merchandise and we talk about pop-up strategy. Um, and really, um, you know, those conversations with um, developers, landlords. Um, we have, we do have some landlords that come to us and they ask for four tenants and we love being part of that conversation so we can, you know, make appropriate, um, you know, uh, referrals. Um, but we do, we are striving to push that, to push it, to push the conversation towards smaller space.
Speaker 1:Okay. So, so there may be a lobbying role for this organization[inaudible] yeah, no, but I, I mean, I think that's important. I mean, getting everybody on the same page when it comes to what the, what the trends are. Um, because every developer says, okay, we're going to have retail space on the first floor. But they've, you know, I can't tell you how many developments have just these big spaces that frankly are overpriced, uh, getting people realistic on their rents to, it seems to be a big problem as soon as an area gets, gets moderately hot than the people that made it that way, can't afford to stay there anymore.
Speaker 4:Nice. I say yes. And, um, we have to recognize that, you know, the regional NASA national chains, they want to be in the city. And, um, you know, uh, that's happening. Um, and so then how can we advocate for those, for the small local retailers that do bring that character right and, um, that bring the mix that people want.
Speaker 1:And that seems to be a bit of a struggle though. Uh, Sarah, I want to ask you this too because one of the things you guys do offer here is this bootcamp. And we talked a little bit about the coaching, but the bootcamp is something that's a little bit more, um, Oh, I guess it's called bootcamp. You're sweating bullets here cause you've gotta have aspects of your business
Speaker 4:sort of buttoned down before you, before you get outta here. So talk a bit about, um, what you're looking for in a participant there. How far along do they need to be? Sure. So this year we are offering one cohort, um, so though applications for that will open up in April, um, and the class will go from July to September. And so, um, applicants, we don't have a certain dollar threshold that we're looking for. We're looking for businesses that want to open a brick and mortar location in the city of Detroit within six to 12 months of completing the program. Uh, we're looking for businesses that have some sales history. So that could be$1,000, could be$50,000. It could be someone, um, who has, you know, 20 years of retail experience. Uh, but they may not have traditional sales of their business, but they're certainly coming with some industry credit. Um, and so, uh, we're looking for people who, um, are passionate about the city, passionate about brick and mortar, um, and are open to feedback, right? Because we can, during those 10 weeks, we can solidify what they're already doing. We can break it apart and put it back together. Um, it's a great, um, personal experience for the class. It's about 15 people. So, uh, we get, we get in there. Um, and it's a great time and it culminates in a showcase event at the end, but I think it's important to point out this is not, you just foisting as some sort of cookie cutter approach on these things. You analyze each of these businesses individually? Absolutely. There's a team of three or four of us that, um, are the core support team. Um, and within the team there's myself who's worked in larger retail, um, you know, professionally sold shoes at Winckelmans with my mom back in the day. Um, and then the rest of our team, um, I've also worked for larger brands and, um, run their own smaller independent boutique. So we know we have a sense of knowledge and empathy of what it takes day to day. So, um, we'll dig into their pricing and marketing and merchandising. Again, the role of design, I can't stress that enough, um, on how design can really elevate their space amongst the rest. Well, and I think one of the other things that you possibly could do, and I could be wrong about this though, is connect them to a larger network of, of people in this field because it does seem as if there is a bond between retailers. They need each other to succeed. If a district is going to succeed, uh, connecting them with people nearby in their neighborhood. Uh, it's fantastic. We have representatives, not only do we have professionals from different, um, sectors of retail come and talk about, um, you know, e-comm and things like that, but we also have representatives from the DGC community organizations throughout the city that come and advocate for their, their areas and different spaces that are available. Um, and, and we, we promote that the, uh, participants go and visit local retailers and, and talk about their experiences. I have to ask, you know, you mentioned of course the DEGC and coordinating with motor city match and things like that. There are a number of just regular businesses that a lot of these neighborhoods that are trying to be revitalized, and I of course worked on this myself for a long time, uh, that, you know, not everybody needs like a gourmet cheese shop or something like that, but somebody might need a dry cleaner, somebody might need a, you know, just basic services in their neighborhood again. And that can be a very viable option for absolutely. So do you get people that are coming in saying, I want to open a store. I just don't know what kind of store it should be. We, we have more of, I make this, I don't know where to put it. Right. I'm don't, I'm not really sure. And so that's where we want, we want that 10 weeks and beyond because all graduates get six months of coaching. We help them whittle down or redirect, right. Um, to help them understand if it makes sense of where they want to go. Right. Um, and, and it's a great, um, retail bootcamp. It's a great place for people to really dig into if brick and mortar makes sense. We may have graduates that identify, you know, what a Makerspace like Ponyride is more like what I need to do or maybe I'm going to be selling wholesale, um, or maybe I need to go back and revisit my business plan. And so we'll, we'll refer them over to, you know, our partners at, you know, build Institute, prosperous, things like that that can help them dig into it. Um, so it's about, um, again, that value system if brick and mortar will make sense for them. Um, and how we can help them get there in a thoughtful way, not only for themselves, but also for the neighborhood where they want to land. Well, I do want to ask you this. What's, what's the one mistake you see time and time again? People make as they try to make the leap into this field waiting for perfection, waiting for perfection. I'm not saying go be careless, but waiting for the most perfect situation possible, right? Um, there is an element of risk. You know, we'll go through every, you know, uh, aspect that you need to consider, but in the end it's, it's your business and in the end you're going to need to see what you're willing to, what you're willing to compromise on, right? Maybe the space isn't in the exact location, but maybe it's one block down, right? Or maybe your build out is going to take longer than you thought, right? It, let me say that again. It will take longer than you thought and it will be more expensive. So I'm really thinking it's going to happen sooner than, than you, than you anticipated. And so we view, okay, well if that official grand opening is going to take longer than we thought, well how can we help you strategize your sales and marketing so you're building momentum and, and not losing ground. Right? So, well, it seems to me that every single person in the world has at one point in their life thought about opening up a little shop doing something that they love, right? Just be so much fun. Right? It seems like it would be, but you know, how many good ideas do you think have gone by the wayside because people didn't want to take a chance, right? They didn't want to take a chance or, um, know where to begin. They'd know where to begin or it was going to be really hard and they didn't want to do it. Right. So, um, brick and mortar retail retail in general is not for the faint of heart. Right? You're in the front lines 24, seven. Um, and so we really, whether you want to spend one hour with us in an open office hour, whether you want to be a vendor at the shop or commit to a 10 week program like retail bootcamp, um, or if you're already open in the city, you know, we have a great, um, complimentary program, SWAT city, they help existing businesses in the city, help them scale. Um, and so really come, come talk to us. We are here to help and guide you whether it's our resources or someone else in the service provider ecosystem. Um, we're here to connect you with things that you need at the right time. Well, I doubt sir, you'd be doing this if you didn't have a lot of faith in, in, uh, the city, uh, the region to support these types of businesses. Um, what's that one little word of encouragement you'd give to somebody? Well, not one word, but, um, you know, it's a word of[inaudible]. No, I think, um, I think it's a combination of, um, don't be afraid to ask for help because if you, as an entrepreneur or a maker, small business owner, whatever title you want to, you know, attached to, um, if you are having an issue or having a problem, you're not alone. Um, and there's more than likely other, um, other business owners that are going through the same thing. And so there was more power in, um, our collective knowledge. So asking for help as a sign of strength, not a sign of weakness.
Speaker 1:Well, Sarah Donnelley, we certainly do appreciate your time today. Best of luck with this. I know people can get more information about all your programs@techtowndetroit.org. Uh, the retail bootcamp, uh, applications do win
Speaker 4:applications open in April, um, open office hours and shop applications for the popups. They're open year round, so TechTown detroit.org. Very good. Well, we appreciate your time today. Thank you very much. Thanks so much.
Speaker 1:Sarah Donnelley is the director of retail services for tech down Detroit. We certainly appreciate her joining us on the program. And of course we appreciate TechTown's support of the Craig folly show on deadline. Detroit. Kind of a big deal. All right. Uh, just to let you know what I'm up to tomorrow, it is the Detroit regional chambers annual Detroit policy conference taking place at the motor city hotel and casino. That'll be happening all day tomorrow. So what you need to know, I am going to be doing interviews throughout the day. I've already got a half dozen or so scheduled, but there are more that are coming online as we speak and I expect to fully a bunch of surprises tomorrow. Not exactly sure who's going to show up there, want to be talked to, but I've got some cool stuff that I'm going to be working on. So I will be live streaming that stuff on my Facebook page pretty much all day tomorrow as I have guests, I will have a live stream up so you can follow along that way if you like. Uh, also I'm going to take some of these interviews and repackage them as podcasts. So if you are one of those persons that really prefers not to ever see me and I totally understand that, uh, that's fine. I will patch those for you this way. But again, look on my Facebook page tomorrow I'll be live streaming all the interviews that I do from the Detroit regional chambers policy conference, Detroit policy conference that's tomorrow. And then some of these interviews will find their way into the podcast over the next several days. So it's going to be a busy day tomorrow. Looking forward to it, my friend Michael Luisito and I will be down there. So if you happen to be going to the policy conference, stop by the deadline Detroit booth, we'll have a little mini studio set up. They're ready to do all sorts of interviews and have some fun. So come on by, say hello, even if you don't want to sit in front of the microphone. I get that. But I always like meeting you and hearing from you and finding out what's going on in your world because you never know. It could end up as a subject on this show. Hey, thanks for checking it out today everybody. Don't forget. Tell your friends, send me email the Craig Folley show@gmail.com you can text me at that same address. If you just plug in that email address to your text and your phone, it'll come right to me. I can see it that way. Let me know what you want to hear about. Also, find me on social media just about everywhere you can think of so it's not hard. We'll talk again tomorrow. Looking forward to it and again,
Speaker 3:but for me on my Facebook page tomorrow we'll be live streaming interviews starting at about 9:00 AM so it should be an interesting day and a busy one at that, but then again, who would have it any other way? I have a great one. The Craig Folley show was made possible in part by deadline Detroit deadline. Detroit has some of the best journalists in the city. We're asking you to support independent local journalism by joining our$3 a month membership. By joining you become eligible to win prizes, including tickets for sporting events and gift cards to some of Detroit's best restaurants. Just go to our website and click the ad@thetoporgotowwwdotdeadlinedetroit.com slash membership.