He also established new distribution centers, closed many unprofitable locations, and established several new stores in target areas. Seven new locations were opened last year, bringing the company’s total brick-and-mortar store count to 44.
The rollout allowed DiPaolo and his team to “connect the dots,” he said, explaining the strategy he and his team used when selecting locations for the new stores. “We saw a few gaps between the concentration of stores in the New England region and the Midwest, so we focused on filling in those areas,” he added.
When DiPaolo purchased Work ’n Gear in 2002, the Weymouth, Mass.-based uniform and work-wear retailer was strictly a brick-and-mortar operation. It remained as such for roughly six years, but a few years back, DiPaolo, aware of the impact e-commerce store can have on revenue generation and end profits, made a decision to change that, and in 2008, the company launched its first online store.
Exploring target markets
The aggressive, multi-pronged approach to growth certainly seems to be working. The company has generated a steady revenue stream in each of the years since the 2002 acquisition, and individual store sales are up significantly (some as much as 60%) from that time.
Currently, all 44 Work ’n Gear locations are thriving, as is the company’s e-commerce operation, which has been a key focus area for DiPaolo and his team in the last two years. “We’ve made a strong effort to ramp up the online store in the last 18 to 24 months. We’ve developed a site that allows both employers and individual customers to buy direct from us,” he said.
“We also integrated it with our in-store kiosks, which increases customer access to some of the less-common sizes and more obscure items. We can’t carry every item at every store across the enterprise. This technology allows our associates to place an online order for a customer, if the store doesn’t have a specific item in stock, and we offer to ship the order directly to the customer’s house. It speeds up the process and improves customer experience,” DiPaolo added.
Although the e-commerce platform is a relatively new operation for the company, it has already proven to be a frontrunner in terms of growth potential, allowing Work ’n Gear to grow revenue and reach out to customers in new areas in a very cost-efficient manner. Sales at the online store are already greater than those generated by any one of the individual brick-and-mortar locations.
The site continues to grow at a steady pace, experiencing a month-over-month sales increase of between 30% and 40% each month this year.
“It has proven to be a big market for us. It’s already the largest store we have, and we project it’ll be three or four times the size of our largest brick-and-mortar location before the end of the year,” DiPaolo said.
Keeping an eye on the market
Work ’n Gear’s strategy and approach to the market is multi-fold. Competitive pricing, in the brick-and-mortar locations as well as the online store, is definitely a factor in the equation, DiPaolo said. “We’ve made a conscious effort to keep an eye on the market and make sure our products are competitively priced. This was something we paid particular attention to when developing the online store, and I think it’s definitely contributed to its success,” he said.
DiPaolo said the company’s product selection has also played a large part in its success, especially in the online world. “We offer a wide assortment of products in our online store,” he said.
The team at Work ’n Gear plans to open a new distribution center sometime in the future and is exploring a number of other investments that will support the back-end operations of the online business. These plans play a large role in ensuring customer satisfaction remains high as the online store grows, since they will help increase inventory/product availability and improve shipping windows.
The company is also in the process of upgrading its operating systems, working with Celerant Technology, the company that installed its current software in 2002. The upgrade, which is expected to take place next month, will increase the company’s merchandising efficiencies, allowing it to integrate supply chain management and have access to a virtual inventory.
“Technology certainly has a major impact on operations, so we are excited for the upgrade,” DiPaolo said. “But technology isn’t everything. We are successful because we know who our consumers are, and we market to them. We’re vigilant in trying to create a strong and cogent message for customers, and we’re very aggressive in our pursuit.”