Traverse City Record-Eagle

Business

June 11, 2014

Retailers turn to online-only sales

TRAVERSE CITY – Cynthia Koeze’s 20-year stretch of business success isn’t obvious from the street.

Koeze’s store, Hats and Haberdashery, operates only online.

Koeze opened the women’s boutique in downtown Suttons Bay in 1994 so she could reach more customers for her custom hats. Tough economic years and seasonal swings stressed the store, so Koeze abandoned the traditional brick and mortar business model on Dec. 31, 2006.

“Now I don’t have these huge fluctuations,” she said. “We have an international customer base, we ship all over the world from my 10-acre farm in Leelanau County. It’s pretty fun.”

Koeze estimates Hats and Haberdashery is twice as profitable as before. She doesn’t have to rent a storefront and sells more to web shoppers than window shoppers.

Tom Scott, senior vice president of the Michigan Retailers Association, said Hats and Haberdashery’s model isn’t typical.

“We have online retailers opening stores, you even have the Amazons of the world talking about setting up physical stores,” he said. “Then you have an even larger trend, which is retailers making sure they provide a sales channel however the shopper wants to shop, which means they have a physical store, they have an excellent website, they might even have a catalog.”

Cherry Hut owner Andy Case said his Beulah business increased sales of shipped cherry products by more than 20 percent since it started online sales in 2007. That helps the business operate year-round, even when the restaurant closes for the winter. Case now staffs 15 people to fill December holiday orders, compared to just five back when orders came through fax and phone. He attributes that growth to the website.

“Once we switched to the website most the orders came through the web,” he said. “It’s a lot easier. It’s tough to understand people on the phone and read people’s writing. This takes a lot of the guesswork out of it.”

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