I went to see the Carrefour at the Makedonia shopping center at the outskirts of Thessaloniki this week because I wanted to check out some prices. Instead, I ended up buying reading glasses.
The Carrefour was awful. Nothing more miserable than a huge supermarket without any shoppers in it. No surprise that the Gran Masoutis near our home is so much more successful. They have a much better concept!
As I walked away from the Carrefour, I saw large footprints painted on the floor advertising eyeglasses for 19 Euros. Being a user of reading glasses, that caught my attention. I followed the footprints and ended up in a store for eyeglasses.
At that point, I was impressed. Having once owned/run my own small business in the Chicago area, I learned a lot about retailing. The trick is to get the potential customer face-to-face. Once you have him face-to-face, you are half-way home for the first sale (if you don't believe that, you better concentrate on the Internet for selling your stuff). If you sell products, you have to get the customer face-to-face in your shop. If you sell services, you normally have to get the customer face-to-face in his office. Either way, you have to get him face-to-face.
So here I was in a store for eyeglasses being greeted by a very friendly young Greek lady and I was favorably disposed to the whole thing --- even though I had had no intention of buying eyeglasses. Not bad for a start!
The eyeglasses advertised for 19 Euros were already sold out but the young lady could show me alternatives. By the time we were through, I was looking at a proposal costing 225 Euros.
While the young lady was testing my eyesight, we were chatting about the state of affairs in Greece, which she said was very bad. I asked her whether there were unemployed among her friends. She said yes, many, above all her husband.
Her husband is a carpenter and he had lost his job. I asked why he couldn't get some orders working on his own. The young lady reminded me that there was a crisis, among others a construction crisis, too. So that was a dumb question on my part. I asked her how much unemployment insurance her husband received and she said 'none' because he has been unemployed for over 1-1/2 years.
I then asked her what they would do if she lost her job, too. She said that they would have to look for work in another country.
When the prototype for the eyeglasses was ready, I asked where the lense would come from. From Germany, the young lady said. A Zeiss. I asked why it didn't come from Greece. She explained that there was only one lense manufacturer in Greece and his products were not as good as those from Zeiss.
I then asked where the frame would come from. From France, the young lady said. The French make much better frames than the Greeks.
Since the store was quite busy, I commented that the owner must be quite happy about the way his business was going. Yes, the young lady said, but the owner was a company in Holland.
I asked her whether she could see my point that Greece as a country would be much better off if Greek manufacturers made lenses and frames and if the business were owned by Greeks. She said 'of course' she understood that. The only problem was that the Greek politicians did not understand that, she added.
At that point, I could no longer resist and I purchased the glasses which I had not intended to purchase and which I really didn't need. So much for good salesmanship!
As I walked on, I passed by another store for eyeglasses. There were no painted footprints leading to it. There didn't seem to be any customers in the store. I walked through the door to check it out. No one paid attention to the fact that a potential customer had walked through the door. So I walked back out of the store.
So, within a couple of hours I had observed the difference between good and bad salesmanship, I had seen evidence that Greece could do a lot less importing (and create new jobs through more domestic manufacturing) and I had talked to a young lady who understood all that. Quite an experience!
The Carrefour was awful. Nothing more miserable than a huge supermarket without any shoppers in it. No surprise that the Gran Masoutis near our home is so much more successful. They have a much better concept!
As I walked away from the Carrefour, I saw large footprints painted on the floor advertising eyeglasses for 19 Euros. Being a user of reading glasses, that caught my attention. I followed the footprints and ended up in a store for eyeglasses.
At that point, I was impressed. Having once owned/run my own small business in the Chicago area, I learned a lot about retailing. The trick is to get the potential customer face-to-face. Once you have him face-to-face, you are half-way home for the first sale (if you don't believe that, you better concentrate on the Internet for selling your stuff). If you sell products, you have to get the customer face-to-face in your shop. If you sell services, you normally have to get the customer face-to-face in his office. Either way, you have to get him face-to-face.
So here I was in a store for eyeglasses being greeted by a very friendly young Greek lady and I was favorably disposed to the whole thing --- even though I had had no intention of buying eyeglasses. Not bad for a start!
The eyeglasses advertised for 19 Euros were already sold out but the young lady could show me alternatives. By the time we were through, I was looking at a proposal costing 225 Euros.
While the young lady was testing my eyesight, we were chatting about the state of affairs in Greece, which she said was very bad. I asked her whether there were unemployed among her friends. She said yes, many, above all her husband.
Her husband is a carpenter and he had lost his job. I asked why he couldn't get some orders working on his own. The young lady reminded me that there was a crisis, among others a construction crisis, too. So that was a dumb question on my part. I asked her how much unemployment insurance her husband received and she said 'none' because he has been unemployed for over 1-1/2 years.
I then asked her what they would do if she lost her job, too. She said that they would have to look for work in another country.
When the prototype for the eyeglasses was ready, I asked where the lense would come from. From Germany, the young lady said. A Zeiss. I asked why it didn't come from Greece. She explained that there was only one lense manufacturer in Greece and his products were not as good as those from Zeiss.
I then asked where the frame would come from. From France, the young lady said. The French make much better frames than the Greeks.
Since the store was quite busy, I commented that the owner must be quite happy about the way his business was going. Yes, the young lady said, but the owner was a company in Holland.
I asked her whether she could see my point that Greece as a country would be much better off if Greek manufacturers made lenses and frames and if the business were owned by Greeks. She said 'of course' she understood that. The only problem was that the Greek politicians did not understand that, she added.
At that point, I could no longer resist and I purchased the glasses which I had not intended to purchase and which I really didn't need. So much for good salesmanship!
As I walked on, I passed by another store for eyeglasses. There were no painted footprints leading to it. There didn't seem to be any customers in the store. I walked through the door to check it out. No one paid attention to the fact that a potential customer had walked through the door. So I walked back out of the store.
So, within a couple of hours I had observed the difference between good and bad salesmanship, I had seen evidence that Greece could do a lot less importing (and create new jobs through more domestic manufacturing) and I had talked to a young lady who understood all that. Quite an experience!
And reasons like this (forgetting or needing to get reading glasses on vacation) is the main reason I had my iLASIK procedure a few years ago. I could not stand having to go and find a place that sold glasses, and trying them on, some places had different magnifications, just a huge hassle.
ReplyDeleteDid the shop offer you Greek manufactured lenses?
ReplyDeleteIf not, I suggest that's because there aren't any! Five companies dominate the manufacture of the eyeglass lens market:
3 Japanese - Nikon, Hoya & Seiko
1 German - Zeiss
1 French - Essilor (the biggest)
If you really think a Greek start-up could compete with those corporations then...
Below that you are up against the Taiwanese, Chinese, Malaysians etc - such as the €19 mass produced off-the-shelf teasers that the shop didn't have.
CK
I must admit to being surprised at the cost of these "cheapie" reading glasses. 19 euros? I noticed some the other day for €5.
ReplyDeleteThat was in Austria.
May I ask what the Greeks are up to? If they are over-charging to that degree is it any wonder they have economic problems.
As a response to Canutely King above, five companies do dominate. Eyeglasses after all are a commodity. That means scale and efficiency count: think of the 15000TEU Emma Maersk! Older vessels from the 80s and 90s are simply too small to even have a toehold in the business now.
However, Herr Kastner's article points to something that is not understood well even here in the Nordeuro Zone: how to make it obvious that you have something to sell. It is no less common here to find people who simply put out their wares and expect the public to simply turn up and buy. That seems to work for now. Should times get even tougher, that will be when they finally realize their business model doesn't work.
My tenet is if the question is about money, it is the wrong question. The question is who is spending that money and why. That level of service saw you walking away with some expensive reading glasses. That you didn't want them was a little injurious to that business - as you won't be recommending it to anyone. That is a mistake of the first order, as recommends from people such as yourself (= the customer) drive a large chunk of sales. The aim is to get those people who really want them, and come away happy with the big purchase.
Can Greece do this? I know Germany can't.
Gemma - on any Liaki (street market) in Greece you can find reading glasses @ Euro 2,50. Shop just before the market is closing and you could buy for Euro 2,00.
DeleteJon C
If your a whole day reader, try LED Readers glasses to help you see more with the help of LED lights. This way, you can read your favorite books everywhere you like.
ReplyDeleteI've read several of your articles. While I agree that new production and investment is what Greece needs, you seem really prejudiced as to why this doesn't happen. You always say that it's up to the Greekes, look at Costco etc.
ReplyDeleteI must remind you, that if you look at the numbers, eg here:
http://slackwire.blogspot.gr/2012/11/what-drives-trade-flows-mostly-demand.html?spref=fb you'll see that in the boom years Greece was actually producing more goods and was more competitive. Why? ACCESS TO CAPITAL.
There's only one company in Greece and their lenses aren't as good as Zeiss. Well, if you try to create another lens-making company, you'll find that you need financing and capital to get started. You'll find exorbitant taxes. If you make a profit you won't be able to invest it back in the company, but the state will take it, under direct orders from Tomsen mind you (the "ektakti eisfora" was his proposal, I've heard the demand for it from his own lips, as well as the demand for higher VAT). So, is it my fault as a Greek busssinessman that my lenses aren't competitive? Is it my workers' fault?
I think you have answered your own question. It certainly isn't your fault as a Greek businessman that your lenses are not competitive if that is due to the constraints you mention (lack of capital, taxes, government, etc.). What you describe is an investment environment which is unattractive to private enterprise and, consequently, to private capital. I don't have the statistics but it would be interesting to check how much German companies, to take only one country, invest directly outside Germany every year. I am sure that this would be a very substantial number. That money goes to countries where the investors deem the business framework to be attractive (and Greece is not among them) and many countries compete for that money buy offering the best business framework they possibly can.
DeleteThe World Bank's Doing Business 2012 Report ranked Greece at position 100. The 2013 report ranked it at position 78. That is indeed good news. The bad news is that even at position 78, Greece is still the least attractive place to do business within the Eurozone.
To create attractive business conditions is the government's job. Regrettably so, because if the government fails, individuals like yourself or your employees can do very little about it.
PS: the production of lenses isn't necessarily something where I would expect Greece to have significant competitive advantages. But I feel strongly that there are a lot of other areas where Greece has competitive advantages as well as significant potential. Perhaps you want to take a look at the McKinsey Report which I summarized in the post below.
http://klauskastner.blogspot.gr/2012/10/a-growth-model-for-greece-post-scriptum_27.html
Nothing ground breaking in this article Klaus but you do not highlight the supreme irony of the crisis in Greece and the complete ignorance of the majority Greeks.
ReplyDeleteOn the one hand you have 99% of Greeks understanding the government through taxes and regulations are at the heart of the problem in Greece and yet you have 70% of Greeks voting for political parties who want to expand the scope and power of government..........It is a crazy situation