Have You Checked Your Receipts Lately?

As you might expect, I spend a lot of time every day checking the pulse of my markets. What are the customers saying today? How do they think we're doing? What complaints do they have? I speak about these issues frequently with my management team, and one response I receive is that customers often say the following: "We think the stores are great, and we love shopping at Hiller's, but wish the prices were lower."

Yet, I know that our base prices are in line with our least expensive competitors and are well below our supposed "gourmet" store competition.

Since this is one of the most frequent sentiments expressed by my customers I thought I would address it, because I know there’s far more to this issue than meets the eye.

Let me start with an example. You, the customer, go to one of my competitors with a shopping list of 20 items. You walk the aisles, and find that they're out of your favorite mustard, oatmeal, and yogurt. Next, you walk over to the deli department to buy some turkey. After waiting for more than 5 minutes for service, you think that the turkey looks a little old, and though you buy it, you don't want to take a chance on the roast beef that was also on your list. On the way out, you had planned to pick up an apple pie from the bakery department, only to find that they only have blueberry and peach left available.

What was once a list of 20 items has been reduced to 15. That's 25% of your list!

Now let's replay that same scenario at Hiller's. You walk the aisles, picking up your favorite mustard and yogurt. For the sake of fairness, let's say that we've also run out of your favorite oatmeal, but while you were looking for it, you see a variety of granola bar that you've never seen before. It looks interesting, so you decide to try it, along with a package of Edamame from the Japanese section you'd heard a friend talking about. You then proceed to the deli department, and, after your last experience, ask to try some turkey before you purchase it. Finding it to be of excellent quality, you purchase it, along with the roast beef you had wanted before and some ham that looks good also. On the way out, you grab the apple pie you've been looking for, and, pleased to have found it, decide to buy some vanilla ice cream to go on top.

So let's reassess the situation. You started with a list of 20 items, and unfortunately we were out of one of them. However, you found a new granola bar to try, a hard-to-find Japanese item, and you also added some ham and ice cream to your purchase. What was once a list of 20 items has now become 23. That's 8 items more than our competitor!!! That's 54% more items!

The underlying concept I'm getting at is that perception is often as powerful as reality; the perception that Hiller's is more expensive because your shopping trip cost you more. Some people will recognize that they are spending more at Hiller's because we are simply able to fulfill more of their needs. They tend to be enthusiastic customers because we have surprised them with items they never thought they'd find. Yet others continue to conclude that we are just more expensive and never look beyond the bottom line.

We simply carry thousands more items than anyone else. Because that is the case, it's inevitable that customers will bring home more items than they would elsewhere.

As always, I and my staff do our best to find the highest quality items, provide the best service, and try as hard as possible to keep everything our customers are looking for in-stock, always. At the same time, we do our best to keep prices fair and in line with our least expensive competitors, and I'm confident that we achieve that goal. And, on any given week as many as 500 common items will be on special and have prices reduced even further.

Perceptions are tricky things and I'd hate to have my shoppers thinking I am in the same rarified air of high pricing occupied by some of our supposed gourmet competitors . I encourage you to scrutinize us. Check those receipts and let me know what you think!

Jim Hiller