Sloat Garden Center had nine locations in the San Francisco Bay Area when the business purchased Navlet’s Garden Centers in the East Bay in January. Dave Stoner, president and CEO of Sloat, discusses how they successfully transitioned four stores and reopened in less than two weeks.
Q: What prompted your decision to purchase the Navlet’s stores?
A: Four great locations. We had one location in the East Bay, which is where the other four are located, for the last 15 years. This gave us a base in the East Bay that was all of a sudden very significant and allowed us to do things logistically that we were unable to do with just one location over there. Geographically, having the bay and the bridge between locations is challenging. We warehouse, so now we have the ability and the volume to run independent warehouses, one on each side of the bay. We put a lot less miles on the trucks.
Q: What’s the East Bay customer base like?
A: It’s still a relatively high-end Bay Area customer base. It’s not cheap to live in the Bay Area. It has probably a higher blue collar population than say, San Francisco proper or the rest of the West Bay. There are also two or three of the most affluent areas in the state of California, if not the country, that are in our backyard, so to speak. It’s an interesting cross-section.
Q: The goal was to reopen the four Navlet’s stores with new Sloat signage and systems by February, and you hoped the transition would be “relatively seamless.” Did that happen?
A: It far exceeded our expectations. When we purchased the stores, we were looking at the value of these great buildings and the locations, and everything about it seemed like a good value to us and a long-term win. What we didn’t realize was the people we were getting. There are 20- and 30-year veterans who have been with Navlet’s that long who have added so much. They embraced our philosophy. It really could not have gone better, and that’s due to the people. Plus, we got a little bit of rain and some nice weather. And that’s everything in the nursery business.
Q: How did you get staff on board so quickly, especially those who had been loyal to Navlet’s for decades?
A: It really wasn’t that difficult. They knew Navlet’s was struggling. It was obvious to them. We offered everyone their positions, and we’ve only lost a few since. They were hungry for change and hungry for the type of autonomy that we give our stores. When I say the people made it work, it sounds cliché, but it’s true because they embraced what we were doing. We had to train and share how we go about doing what we do. We’ve tried to embrace that concept of longevity. [Navlet’s had] been in the community [since 1885], we’re not going to discount that, and we’re trying to honor that as best we can. We took over the stores and changed out everything, including all of the POS hardware, signage, repriced everything and opened in 12 days. All four stores. It was crazy, but in a good way, because the sun was out and it was getting busy. We got open as quickly as we could, we filled the gaps as we ran once we were open. It really, in retrospect, could not have gone better this spring.
Q: How did you communicate with customers that Sloat would provide the same quality service and products they had come to expect from Navlet’s? I’m sure having consistency in staff helped.
A: That was not unintentional on our part. We knew that we needed to continue those relationships. As we started looking at the tenure of the team, we realized the customers have known these people since they were kids. So it was really important that we keep the faces there and let them deliver the message. The stores are now beginning to look different, but for a while, they were just the same with different uniforms and different pricing. That was probably the most challenging of the transition, was to try to gauge what the customer reaction was.
Q: How did you gauge the reaction?
A: We interviewed staff members, set up a way for them to give us the feedback as quickly as possible. Sales were great. Customers did a lot of talking with their wallet, which is exactly what we had hoped for. There were some glitches along the way. There were some problems with getting people into our system and translating Navlet’s reward program to our reward program, but it’s pretty much ironed out. There’s always a resistance to change until you see the benefits.
Q: What was the resistance?
A: You need to sign up for our [rewards program,] because we don’t want to assume that you want to be a part of our rewards program. We processed 15,000, what we call our “gardener reward program,” over two-and-a-half or three months. They like the rewards.
“When we purchased the stores, we were looking at the value of these great buildings and the locations, and everything about it seemed like a good value to us and a long-term win. What we didn’t realize was the people we were getting.” — Dave Stoner, president and CEO, Sloat Garden Center
Q: That’s a really ethical way of doing that, honoring the customer by letting the customer choose to be on the rewards system.
A: Amazingly though that’s where we got the most blowback, and it was a convenience thing. We were trying to respect them and not just plop them into our system. We’ve got a growing customer base as more and more people sign up. We’re still figuring out our market. We were in a single location with a pretty finite customer base, and now we’re in five locations with a much broader, much more diversified customer base.
Q: In 2015, everyone was talking about the drought in California. Those conversations have seemed to settle, at least nationally, but I know it’s still an issue for the state, as it has been for several years.
A: The drought isn’t new to us on this coast. This has been part of our philosophy for 25 years. Mediterranean planting, replace your lawns, we like to call it “get off your grass,” that smart water use kind of planning. The drought is something that our customers have in their minds all of the time, we have in our mix and our message all the time. That said, we had significant rain and snowfall, and rationing was basically lifted, not all of it, but the majority of it. We’re in the nursery business. When the sun comes out, we’re busy, even in a drought.
Q: What are you most happy about and proud of with the purchase of the Navlet’s stores? What has been successful?
A: The transition of the people. When you live with your philosophy, it doesn’t get put in your face. You don’t see it, you live it. To see four stores that had a completely different business philosophy embrace [ours], and the way we do pottery and how our customer guarantee works and what our customer service standards are, to see those things evolve really reinforces as a company what we’re doing.
Q: What trends are you seeing?
A: Succulents will never die. Terrariums are moving on and fairy gardens are moving on — we’re over the hump. Pottery continues to amaze me. It just keeps selling. Introducing pottery into these four new stores to these customer bases who haven’t seen the way we do it has been remarkable. The sales have been incredible for six months. Lightweight pottery is everywhere. Hot colors on this coast have slowed down. They were really hot four or five years ago. Earth tones and more muted colors [are more popular now,] unless it’s blue. Blue is like succulents. Blue will sell forever.