DBC Ride Shop in San Clemente hit some rough waves in recent years as competition, the loss of a longtime location and an expensive experiment with snowboard gear drowned sales at the once-thriving skateboard and surf shop.
Co-owner Greg Armer, who has been keeping the business afloat with personal savings from his full-time job as a healthcare executive, recently gambled on a pricier new location in a prime retail spot on the beach community's main drag to restore his kid-friendly small business to its glory days.
"Last winter was a big decision point, and I was considering my options, including closing down," said Armer, president of the shop founded in 1997. Instead, he started over in a location he'd long coveted.
"If we can establish ourselves at this time and get a foothold, we can be there when it turns around," Armer said.
To accomplish that, he's looking for ways to help him and George Beard -- the co-owner, vice president and an industry veteran who runs the store -- find success in 1,300 square feet, less than half the size of their former site.
Neither man is taking a salary or other money out of the store, in an attempt to shore up its finances. They want to spend any profit on packing the shop with gear that will attract their target 12- to 18-year-old customers. Armer, a longtime surfer and Hermosa Beach resident, figures they have a year to roll the dice.
To succeed, the struggling business has to sharpen its focus, says industry expert Tommy Knapp, an adjunct professor at USC, surfer and onetime owner of a successful chain of action sports stores.
DBC Ride Shop's small size means the owners need to craft an especially profitable product mix. Lack of funds means they need to rely on creativity in marketing and merchandising. They also must sharpen expense tracking. On the plus side, Armer and Beard, both 56, understand the industry and have built relationships with vendors, Knapp says.
Here are Knapp's recommendations on where to start:
* Consider dropping surf. There are easily 10 surf shops within five miles of DBC Ride Shop's new location in San Clemente, including major chains, Knapp says. That's not even counting some well-known board shapers in the area. It will be hard for Armer and Beard to compete with their small space. Considering their young target market, Knapp recommends they convert their store to skate only.
* Focus on new designers. Knapp suggests an idea Armer says he's considered before: Bring in new up-and-coming brands to make the store unique. It could attract and keep customers who want the latest thing. That doesn't mean the shop should drop its major brands, Knapp says.
"If Vans slip-ons are the hottest thing going, you don't throw them out," he says "But you surround some of those more popular brands with more core products not seen" at big chains. "Core" is short for hard-core, meaning products serious skateboarders want.
"You have to give them a reason to come see you," Knapp says. Even with items available on the Internet, "board-sports customers have indicated they want to support small shops," he says.
* Partner with vendors. New brands might be willing to put their products in the store on consignment, giving them exposure while limiting financial risk to the shop. Armer and Beard also might try to strike a deal where, as in the book business, a new brand would take back an item if it doesn't sell, or would trade it for new product.
The shop's largest vendors are likely to be specialists in merchandising and marketing, and Armer and Beard could tap their services.
"Those vendors want you to be successful so they can sell more to you," Knapp says. "You improve your odds when you get your vendors to be working partners." Vendors can offer help as simple as supplying posters and graphic art to improve the shop's look, or do more involved tasks such as setting up merchandise displays.
* Expand grass-roots marketing. Once they have focused their product and spiffed up the shop, Knapp would love to see Armer and Beard work with up-and-coming vendors to co-sponsor hot dog days at the local skate park (they used to do that) and embrace other types of grass-roots marketing. Give away raffle tickets that kids must redeem in person at the shop, he suggests. A marketing tie to upcoming graduations could work, too, he says.
* Use social media. This is a cheap and effective way to reach their target market.
"You have to talk to the customers in ways they will listen, if it's Twitter, Facebook, uploading videos to YouTube," the shop has to experiment to see what works, Knapp says.
* Differentiate with customer service. Businesses need to have a clear idea of how they differ from their competitors, Knapp says: "What's their secret sauce?" Creating a niche is especially important in a crowded market like action sports retailing in Southern California.
