Ocean State Job Lot CEO Marc Perlman admits the experience of shopping in one of his stores can be confusing in terms of the types of items it stocks at any given time.

“We sacrifice continuity to create value,” says Perlman, who started the North Kingstown, R.I.-based closeout retailer with brother Alan and best friend Roy Dubs in 1977. “We’re not married to any one particular category; we chase value, and that takes us in all sorts of different directions.”

As an example, the retailer’s recent stocking of the Cumberland MF3800 multi-fuel pellet stove, which it sells for $2,000, no doubt raised a few eyebrows among shoppers not used to seeing such a high-ticket item in a closeout store. For Ocean State Job Lot, though, the stove – which typically retails for $3,500 – fits its mission of offering the best prices possible.

“Over the years we’ve learned to have confidence in more expensive closeouts,” Perlman says.

“We’re trying to maximize value, and sometimes that means stocking both low-priced products and high-priced ones.”

Although merchandise routinely changes, value has been the common denominator since the company opened its first store in 1977. “We are a value provider in the retail marketplace,” he adds. “From the time we started, we felt that people work hard for their money, so anyone who is going to create value will be rewarded. We’re completely focused on saving the customer money, and they’ve responded to us with their business for more than three decades.”

Quality is another common thread through Ocean State Job Lot’s offerings. “I’m a believer that junk at a low price is still junk, and that if it’s not something you would buy for yourself, there’s no purpose in putting it on the shelf,” Perlman says. “Our buying team is always doing their best to maintain quality and not be seduced by just a low price.”

Enhancing its Operations

Ocean State Job Lot’s quest to be value-driven doesn’t stop the organization from investing heavily in areas that improve its operations. The company is currently engaged in a labor productivity project. This involves identifying best practices within its own stores and across the retail industry for such tasks as stocking shelves and unloading trucks, and then sharing those best practices across all stores.

Merchandising is also a high priority. The company recently hired more than two-dozen professional merchandisers to improve its ability to attractively display merchandise.

“Even though we’re in a very eclectic business, we’re trying to have a better focus on merchandising,” Perlman says. “We know we offer value, but we also want to make merchandise as attractive as possible.”

On the technology end, the company has in place several software packages including automatic replenishing systems, inventory control systems, transportation and logistics software, and advanced human resource management software. Its distribution center is fully automated, Perlman adds.

Regional Strength

Ocean State Job Lot operates 107 stores in Connecticut, Maine, New Hampshire, New York, Massachusetts, Rhode Island and Vermont. Stores are served by a 1-million-square-foot distribution center in Rhode Island.

The company’s geographic location plays a large role in the products it offers to consumers. Ocean State Job Lot looks to stock items that have a specific appeal to its customer base – such as hand, food, and body warmers – that wouldn’t necessarily translate to other parts of the United States.

“One of our advantages is that we’re a regional company that can resonate with New England customers,” Perlman says.

The concentration of locations also allows company executives to be responsive and attentive to each store. “Our corporate headquarters is in the middle of all the stores we service, so our executives are able to constantly be out in stores,” he adds. “This is difficult for companies that have their headquarters down south but operate stores in northern New England.”

Ocean State Job Lot embraces philanthropy as a core responsibility.  It takes practice to find pleasure in the act of giving away your money or merchandise, and Job Lot appears to practice often. It partners with its customers in numerous charitable endeavors, and together they have donated approximately $10 million to fight hunger, support healthcare and educational institutions, and assist men and women in the military. In addition to these donations, Ocean State Job Lot annually offers 30 percent discounts to military personnel and teachers.

“We donate to dozens of grass roots charities that maximize the impact of our donations on those most in need,” Perlman continues. “The company absorbs 100 percent of the administration and distribution costs of all products we donate through our charitable foundation.”

The company’s foundation also hosts an annual golf outing benefiting regional food banks. And while so much of its philanthropy is focused locally, the company maintains a global perspective, as evidenced by the eight schools it has built to help educate children in Cambodia.

Employee Incentives

Its status as a family owned company is another competitive advantage for Ocean State Job Lot. “We don’t have anybody drawing attention from our mission because of issues such as how the stock market is performing,” Perlman says. “We exist to save money for our customers.”

Perlman describes the company’s internal culture as being driven to succeed and guided by a sense of fairness and respect.

“I love to compete, and am very passionate,” Perlman continues. “I’ve learned to do the most that I can to hire the best people possible – you can’t go to war by yourself, so you have to bring the best generals to the fight. The organization will run a lot smoother if you treat people with respect and maintain an open-door policy.”

Ocean State Job Lot provides a number of training programs and other incentives to its employees. Associates receive a generous 20 percent discount on virtually all merchandise sold in the stores, enhanced by special shopping nights multiple times per year, when it offers 30 percent and sometimes even 40 percent discounts. Perlman says he is also particularly proud of Ocean State Job Lot’s profit participation and bonus program that last year awarded $2.5 million to 2,700 employees.

“I know of no other retailer that provides all of their employees, regardless of their position, an opportunity to share in the profits of the company,” Perlman says.

The company is also unique in that all employees eligible for health care benefits receive their individual coverage 100 percent paid by the company with no cost to them. “Our lowest-paid employees have an identical individual health insurance policy to what I do,” Perlman adds.