Being an independent retailer isn’t easy. Corporate chain stores and big-box retailers are around practically every corner in most cities and towns, and an increasing number of consumers are turning to their computer screens to satisfy much of their shopping needs.
Managing the competitive and changing retail landscape can be a challenge even for large companies with deep financial resources. For smaller, independent retailers without extensive marketing budgets or technical knowledge, surviving is even more difficult.
Mega Group Inc. is helping to level the retail playing field for independent retailers in secondary and tertiary markets in Canada. The Saskatoon, Sask.-based company was formed in 1965 as a cooperative of several retailers who wanted to buy televisions at bulk-rate prices. Today, it serves more than 700 retailers in both English and French throughout the country and is wholly owned by a group of its members. In addition to its headquarters, the company operates offices in Toronto and Montreal, each with a staff of professionals waiting to assist members.
“Our mission is very simple – we exist to make independent retailers strong,” President and CEO Benoit Simard says. “We try to turn what would otherwise be difficulties for independent retailers into strengths through our merchandising and marketing activity. I think we’re leading the pack in Canada when it comes to independent retail.”
Although Simard acknowledges the many market challenges his members face, he is confident in Mega Group’s ability to help them succeed. “One of the biggest assets we have is the natural survival instinct of the independent retailer,” he says. “We have a leadership team that is very grounded, and a courageous board that looks not just at how to increase our share in the market and our profits but also our mission of how to protect the independent retailer. I think that makes us stronger than many other companies.”
Going to the Source
Mega Group has two main operations – a central billing and finance operation and a merchandising and marketing arm that offers group purchasing services. The central billing operation provides retailers with a line of credit and guarantees payments to vendors. This gives retailers the peace of mind of being pre-approved by vendors, as well as the convenience of having only one account to manage. Mega has expanded its customer base for this service and is developing in other categories and other industries through its division Mega Group Solutions, which can be found online at www.megagroupsolutions.ca.
Most of Mega Group’s marketing and merchandising efforts are concentrated on building its BrandSource Canada brand. BrandSource is a national initiative that helps independent retailers overcome the challenges of brand awareness and maintaining a strong online presence, Simard says. The brand encompasses furniture, bedding, appliances and consumer electronics.
BrandSource’s website, www.brandsource.ca, offers consumers flyers and a catalog, as well as a store locator. The site, which Simard hopes to eventually expand into a sales/e-commerce business, directs consumers to local store sites.
“Our goal is to appeal to the consumer and say our members’ stores are worth visiting,” he says. “Eventually, we want to get to the point where the website is as easy to use as that of larger retailers.”
The website is an example of Mega Group’s ability to pool the resources of its members to provide a service retailers might not be able to accomplish on their own. “Most of our retailers are not necessarily specialized, so one of our mandates is to provide them with operational support,” Simard says. “We offer retail support in different ways to bring our members to a point where they can compete and make a profit just as well as any big box.”
Support efforts include Mega Group’s advertising team, which produces flyer and circular campaigns targeted to each of BrandSource’s three main product categories.
The company partners with Les Progiciels Concept Inc. and PROFITsystems Inc., one of the largest point-of-sale software providers in North America, to offer two systems – one in English and one in French. Mega Group also offers training as well as support for those systems.
Both systems help stores automate functions including inventory management, point of sale, customer relationship management, accounting and distribution management.
Another service offered is training programs. Mega Group provides both in-store and online training for store sales staff and managers.
Mega Group’s home furnishings design team helps its members attract customers. The team helps retailers choose lighting, flooring and color schemes for their stores, and also provides room dividers, accessories, offices and other public spaces.
“We pride ourselves in the success retail members have made with their business through renovation and strategic design to increase their sales and profits,” Simard says.
All of Mega Group’s offerings have ultimately helped it triple its membership and product volume since 2000.
Simard predicts further growth as the BrandSource brand continues to gain ground.