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Containing a Counter Culture

Retail today is all about serving customers, and the people behind the counter need to realize that they are the culture. Techniques are discussed for recruiting, training, and managing these employees, including the importance of paying a living wage.

There was a time that "retail" was a profession. The elegant blue-haired ladies or courtly gentlemen behind the counters of a Saks Fifth Avenue or a Brooks Brothers were proud to explain to a customer the difference between this perfume and that, and what tie went best with a striped or solid suit.

In recent years, the retail industry has lost respect. And that's where we come in: we don't see it that way. In fact, to a certain extent, we could be said to be running the retail operation we founded more than 23 years ago -- The Container Store -- as a throwback to those days of service-oriented retail that consumers are pining for.

Except that it's entirely up to date. First of all, we cater to today's modern need for all sorts of vessels in which to put the fruits of a consumer-oriented society: closet systems for clothing; shelving solutions for computers, books and entertainment centers; tool racks and hooks for trendy gardening tools. Then there's the even more modern concept of what we're really selling -- and that is time. Our goal, through impeccable service, is to help our customers save space and ultimately, save valuable time. We figure that in order to accomplish everything you want to in a given day, you must be reasonably organized.

A Thoroughly Modern Culture

And so, we reached "back to the future" to craft a culture of retailing that is suited for a thoroughly modern society. In doing so, we really think we're on to something. As a business, our company has been enjoying increasing sales and profit, our employee turnover has historically been between 15 and 25 percent (a retail industry low) and for the past three years, The Container Store has placed at the top of Fortune magazine's list of the 100 Best Companies to Work For.

Just what defines our culture can best be articulated through our operating business philosophies -- we call them our "Foundation Principles." These are six, "do unto others"-type philosophies that we developed to help guide our employees, instead of a three inch rulebook that outlined exactly how to handle each and every situation that might arise. These ideas were designed to convey our vision to the people we hired, explain what we wanted to accomplish and why, and leave it to them to figure out how to get the job done.

One of our Foundation Principles is called "Man in the Desert." A thirsty man in a desert approaches an oasis, where there are people who can respond in any number of ways. They can give him a glass of water, pat themselves on the back for their largesse and leave it at that. Or they can go out of their way to help: provide sunscreen for his sore skin, a cell phone for him to contact worried kin, camel passes for his journey home.

At The Container Store, our version of "retail" is, in short, to recruit, train and compensate people who will do the latter. A customer wandering the aisles featuring our kitchen offerings is holding two items in her hand and looking confused. Our salespeople engage her in conversation, find out what problem she is trying to solve and ascertain whether she might even need more than either of those items. We take a solutions-based approach to selling.

In other words, make that customer happy, and she will be enthused about the solution to the kitchen problem -- and eager to tell friends and neighbors about it. It's that simple: our "counter" culture is that of service provided by professional sales people to customers who rightly won't settle for anything less.

Making Service Happen

Now, it's one thing to talk about service and another to do the excruciatingly hard work of turning a philosophy into an operating reality. We firmly believe that you can find great people to work retail. In fact, we will hold a position open for as long as it takes to find the perfect fit. Another of our Foundation Principles is the belief that one good employee is equal to three great employee, in terms of business productivity, so why not hire only great people? And, if you truly believe you've hired that great person, you can feel comfortable knowing they will make decisions based on the best interest of the company. These decisions will be based on training -- 235 hours in the first year with us -- as well as the collection of their life experiences, their intuition.

With this philosophy as the backdrop, we then set about putting into place a method for recruiting, training and compensating employees that has nothing to do with the world of "Help Wanted" signs and the minimum wage. At The Container Store, the people we ideally want as sales professionals are our customers -- people who know and identify with what we are all about.

In fact, when we are in the stores, we look for opportunities to engage customers in conversation. Who knows? They may be interested in testing the waters as employees -- a few hours a week at first and then working up to managerial assignments. Similarly, we've put the word out to current employees that we want people just like them, and last year, nearly half of our new hires were referrals.

Nuts and Bolts

When it comes to how this plays out for the applicant, the first big difference is at the job interview. We don't so much question the candidate as impart information about our company. Interviews often last as long as three hours, with us doing most of the talking. Our objective is to get a sense for the person's enthusiasm for the job.

Once hired, these great employees are initiated during a Foundation Week, in which they learn about the company -- its history and philosophy -- and are introduced to the broad range of functions necessary to the business, such as inventory control and visual sales. In other words, before they even get behind a register, they are spared the tunnel vision of understanding only their one role. Additional training enables them to understand our more complicated products, such as our modular closet systems that can be tailored for specific needs.

If sales personnel are professionals, they need to be compensated accordingly. A hallmark of The Container Store is that we pay at least 50 percent more than, and as much as double, the going rate in the industry. As our sales and profit increase, so, too, do the paychecks of employees. And since they are expected to be effective members of a focused team, they don't work on commission. Only recently have we begun to consider bonuses for exceptional results by a team of employees.

The air of excitement found at The Container Store is a true testament to the fact that people love to work here. The retail setting is not typical, as service is our core competency. We all know, as retailers, that providing excellence in service is not plain and simple. It's a responsibility, an ongoing day-to-day commitment, a true pleasure really, when done well, and it definitely involves a lot of time, energy and money. The customer wins of course, and The Container Store wins. And our employees enjoy and benefit from the gratification of creating the very best shopping experience for our customers by offering not just products but solutions that will help customers save space and ultimately, save them precious time. And who couldn't use a little more of that?

More than 24 years later, with 25 stores across the country, a national mail order service, and 2002 sales projected at $275 million, Kip Tindell and Garrett Boone, the originators of the storage and organization category of retailing, remain the leaders in an industry that continues to thrive.

© 2002 Kauffman Center for Entrepreneurial Leadershipat the Ewing Marion Kauffman Foundation. 4801 Rockhill Road, Kansas City, MO 64110. All rights reserved.

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