SALTBUSH SURF, PORT AUGUSTA, SA
Saltbush Surf has been operating in Port Augusta for 21 years and Andy Ireland and his team have faced some unique challenges over that time.
Operating a surf shop 300ks from the nearest surf break is one, with fluctuating local employment and the tyranny of distance among the others. Reggae Elliss caught up with Andy recently and found an astute retailer who knows how to roll with the punches.
Saltbush has been around since 1995. 21 years is a long time in the surf retail game, what do you put your longevity and success down to?
Always learning Reggae! We have been in a constant state of evolution since we started. But you know what, you are only as good as your environment. We have been fortunate that we had a growing market for many of those years with a healthy jobs environment. On top of that we constantly learnt how to be better at business. This has certainly helped us in the current years when the North of South Australia has had a massive workforce re shaping. If we still did things the way we always did things we would be in trouble! Thankfully through ISRA and SBIA giving me access to best practice retail techniques we are still a strong business even if the market today is soft.
People buy from people and with my wife and business partner Elana we have always strived to have the best people we could. We try to give them the tools, knowledge, training and support to be the very best they could be. Lots of crew past and present have said it’s like working for the Saltbush Family and I guess we are like a family. You can’t work with people for years without going through family deaths, relationship break ups, illnesses, and whatever life throws up now an again and we have always had a culture of support and acceptance. We’ve been lucky to have people generally stay a long time.
Yes, good people are crucial to a successful business. How do you find and retain good staff? Any staff training advice you’d like to pass on?
The buck stops with you! That is the mantra I work to. If I hired them then it is my responsibility to train them the way they need to be trained to be great. If they are not great then I should have hired better or trained better. That’s it! Saltbush HR in a nutshell. The book, “First Break All The Rules,” is my management handbook. When I consulted as a business coach, if a customer wanted to cover staff issues I would not discuss with them until they had read that book. Without going into a summary (just go read it), it is about how we get the best from each person, and quite often this means a different path or method for each individual. People are not from a cookie cutter, so you need to find the path that suits the learning and motivational style of each individual. Is it easy? Not necessarily, but like I say, ‘The buck stops with me!’ If I want great people around me then it’s up to me to help make them great in whatever way works for them.
“If I hired them then it is my responsibility to train them the way they need to be trained to be great.”
Retail in regional areas can be tough, are there any particular challenges you see as unique to Port Augusta and the surrounding region?
Challenges!!!!!! Holy crap, Reggae. A nearby coal mine TOWN just closed – 600 people gone! Northern Power Station located in Port Augusta shuts down in May – 200 jobs GONE. Right now the nearby Arrium steelworks is near administration and 3000 jobs are in jeopardy 80ks away from me. The expansion of Roxby Downs mine to be the biggest open cut mine in the world did not happen after years of hype. Never could I have imagined the challenges we are now facing. When people ask me how we are going, I say there are two parts to the answer. Compared to boom times it’s shit! Compared to what’s going on around us, we are holding our own. Thankfully we have learned to run a very sharp retail operation and feel confident we can work with what happens around us. Had we just gotten fat and lazy, we would be stuffed now, Reggae. Without harping on, the retail business skills picked up from ISRA and SBIA have honed us all to a sharp edge here at Saltbush.
Is your customer base local – do you get many surfers passing through on their way through to the Eyre Peninsula and breaks further west?
The nearest surf is 300k’s away Reggae, so surfing per se is not our business. We showcase the surf culture brands to regional South Australia and I’d like to think we do it pretty well, customers in our store often tell us we do. We do get the occasional surfer chasing a leg rope or wax and carry a limited range. We have tried SUPS as we have great flat water here, but this year a number of shark sightings had everyone talking about staying away from the water. It’s a budget town and without the surf culture to prop up board prices there is a disconnect between what customers think a SUP should cost and what they actually do cost. Our town has a population of only around 13,000; luckily we have a few other regional centres within a 100ks we service as well – providing they are economically healthy.
The surf industry has changed a lot over the last decade, vertical retail from the brands, a number of multi-store independents etc. As a regional one-door operator how have you had to adapt over the past 20 years?
You know Reggae, we used to say we were the only Surf Store in town and although physically that may be still correct, with the advent of online shopping it’s as though we have a massive competitor store right next door these days. Our market share has decreased for sure.
My brands are now my competitors and that sucks! They are trying to steal my customers’ details to endlessly market to them, yet they expect me to stock a bigger and bigger physical range every season. Yet I am not able to sell online. Can you imagine how many times customers ask me why we don’t have an online store; It’s a crap load! I will say, I don’t believe letting every store trade online is the answer to maintain brand credibility either, but it’s crap competing with your supplier, and Brand devaluation has become a very real issue.
Promotional activity has caused my customer to de value the brands that I stock. In times gone past we would have a line of customers with armfuls of product when we had one of only two half-price clearances a year. Now with customers getting smacked in the face with an offer for CHEAP surf gear every time they open their phone it’s easy to see our customers have re assessed their value perception of Surf Brands. This is the damage I don’t think the Brands or the purveyors of promotional model understand.
“Brand credibility is getting eroded with every cheap as chips sale. Surf brands are simply not as desirable or valued by the customer as they once were.”
This summer we had our first ever 70% off sale to clear season-end stock because no one gets out of bed for 50% off anymore! This means eroded margins and business viability now becomes a real issue. As per the staff question above, we actually over employ so that AWESOME customer service is one of our differentiators. We invest massively in training time. We employ a premium retail business model and customer experience. Saltbush Surf cannot exist on promotional margins that’s an adaptation we don’t ever want to make.
What are the challenges facing your business and surf retail in general over the next decade?
Reggae, apart from local employment issue, which means we will either scale up or down to meet market demand and that is business mathematics and about sticking to a buying formula to stay financially buoyant. That is one challenge. But the biggest challenge for me is staying relevant to my customer. It’s not up to me to make a brand cool, it’s up to me to showcase brands in a way my customer understands and helps hold the brand cred true. When the Brands keep killing the cool factor by allowing their product to be a price driven promotional commodity then my challenge is how do I stay in business and maintain the margin I need with the brands I have in store. What will my product/brand mix look like in 10 years? Who knows, but it will be a profitable mix I can tell you that! My Salty team depend on me to make it so. They have bills to pay too!
Port August is isolated, how do you go with visits from reps etc.?
What reps? Ha-ha. I’ll cop a smacking for that Reggae! I understand it’s a long trip for them and these days with some of the numbers we do with them I can see it’s hard to make a dollar out of a 600K round trip. I do see a few though and I appreciate it a great deal when they get out here. On the other hand for me a buying trip is between two and three people out of the shop for a few days. Travel, fuel, food, accommodation, its a big cost every buying trip. So it works both ways.
I would love to see some key reps in store more often but as things are the way they are I understand it’s harder and harder to justify.
You’ve been involved in ISRA (Independent Surf retailers Association) and the SRF since the beginning and are on the board of the SBIA. What motivated you to become involved and what do you see as the advantages for your business being involved in industry associations?
I saw an ad for ISRA many years ago offering benchmarking information and I jumped at it. It was a massive deal for me to fly to Sydney three times a year for meetings. I live 300K’s from the airport so it meant a one-day meeting became three days away from the shop. Over time I got to know crew better and socially they became great trips. Business wise I cannot speak highly enough of the help and support I have received from the crew at ISRA. They helped me turbo charge our business. I owe ISRA a lot, which is why I threw my hat in the ring as President for a few years and now take on the Secretary’s role with pleasure.
Over a few, OK over many beers, Reggae, a few of us talked and dreamed of a more united Surf Industry and a way in which every store could get involved in similar stuff to what we had in ISRA. You see ISRA is a closed shop with every member needing to be a non-competitor. This geographically was always going to limit membership. We dreamed of an annual awards event, which the whole industry and every retailer could use to celebrate the wins they had throughout the year. A few of us kicked off SRF with a focus of what we thought the industry wanted. It wasn’t quite right but that organisation morphed into SBIA, which has a slightly different focus, but one I believe is spot on for where we need to be as an industry today. The SBIA board upon formation required three directors from the Brands and I stepped off to make room. I then jumped in as President of ISRA until last year when a board vacancy came up for SBIA and I threw my hat in the ring at the AGM. I got in and resigned as President of ISRA but stayed on as Secretary. Mike Di Sciascio stepped up as ISRA President and the world was a happy place. The SBIA board is full of inspirational industry leaders and is a real privilege for me to be a part of and it’s a blast coming from a small country store to be working with them on issues which can influence and even change the direction of the whole industry in subtle and not so subtle ways.