Above the Treeline

A new vantage point for independent stores

From CBA Marketplace, September 2004

By Lisa Tamayo

IMAGINE A TOOL THAT COULD HELP you understand inventory better, free
up time and money, link you to a community of other independents and publishers, and provide practical information to help you compete successfully.
Above the Treeline—a web-based software tool for independent stores—is doing just that. It lets users zero in on category management—affecting cash flow, inventory turns, and investments. Using charts, graphs, and visuals, retailers quickly can locate information in many custom formats.

Above the Treeline ’s mission is to help independent stores thrive—to succeed
financially and operationally. The software program can help solve one of our industry’s five critical issues—to restore financial health by increasing profits and better managing assets. ATT does that by providing data that helps retailers accelerate inventory turns, stock books customers want, and improve
staff efficiency. It helps you make the right decisions for your stores using easy-to-understand information to spot sales trends and inventory levels; compare data to other stores, publishers, and the industry; and prove your intuition with hard data.

Stores in our industry often can’t compete on price but can compete on product selection and customer service. Department stores such as Kohl’s also focus on product—they know exactly which brands sell well. Even with high cost of goods, these stores produce higher profits. How? Besides having relationships
with vendors for supply-chain initiatives and using technology to their benefit, they micromanage their inventory— they simply know and control it.

Above the Treeline, which can work with virtually any POS system, gives users that same knowledge and control, enabling stores to monitor progress, weed
out what ’s not profitable, and measure what is. The program also serves as a
behind-the-scenes customer-service tool. Christian stores can meet shoppers’
expectations of having what they want, when they want it.

Early-Adopter Test Program
Currently, 20 early-adopter Christian stores—small, medium, and large—are
part of a test program headed by Above the Treeline creator and CEO John Rubin and CBA Training & Development Manager Mike Hockett—coach and mentor through the testing stages. The testing, which ends Sept. 30, will help assess Above the Treeline ’s value to the Christian industry and gather test data. Retailers already are telling Hockett that Above the Treeline is an intuitive way to look at POS data. Retailers are experiencing a sense of control
over their inventory—increasing and decreasing it when necessary—while increasing sales and pinpointing customer needs.

Early-Adopter Store Goals

Specific goals were outlined for participating
stores:

> Identify two to three “opportunity” categories where sales should be maximized. These are categories with large dollar amounts invested but insufficient turns. The “opportunities” show in red, visually indicating an alert.

> Identify two to three “growth” categories to focus on. These are categories
with lower dollar amounts invested but providing higher turns. “Growth” categories show in green.

> With opportunities and growth identified, raise or lower overall inventory based on individual strategies.

> Choose a percentage goal—from 10% to 30%—to increase overall inventory
turns. The benchmark for Christian-retail stores is four turns annually.

> Increase category turns from .5 to 6 turns in four to six categories.
> Choose percentage goals— from 1% to 10%—to increase sales.

> Daily goals: Identify two to three categories per department to focus on titles that should be carried but weren’t (ordering weekly as needed).

> Weekly: Identify seasonal highs and lows by category and reduce or increase inventory to meet demand.

> Weekly: Order top-sellers. One owner compares his category list with the Christian Marketplace best-seller lists and Parable ’s 80/20 report. If he doesn’t have a title, he adds it.

> Monthly: Identify high onhand titles.

Action steps include returning extra and non-selling product, establishing core inventory, analyzing and revising product mix, and selecting markdowns and write-offs.

Why Use Above the Treeline?
Daily Aggregate Data—Using fresh data, you’ll be able to identify new trends and strategies to increase sales based on what’s selling in your store and others. Stores in the program remain anonymous but benefit from other stores’ data. You can measure performance and compare it with others, revealing strengths, weaknesses, and opportunities for change. The Store Comparison chart shows other stores’ turns with similar inventory dollars. In chart form, users can observe how the store is performing one year at a time. The visuals make it easy to see patterns—how product mixes and categories fluctuate and are different from each other—giving users enough information to make decisions to buy, sell, or lower inventory.

Jay Weygandt (Logos Bookstore, Springfield, OH) says ATT has helped him save investments, time, and freight return by knowing what sells in his store and making buying decisions based on that data. Sometimes he thinks, “Am I crazy?” keeping this many copies of a certain title. A quick check in the program lets him see other stores have more than five copies in stock and assures him that his stock is in proportion to others. “It helps you see problem areas and
what’s blindsiding you,” he says.

Customer-Driven Data—Customer driven inventories can take advantage of
local markets using this data-mining tool that drills down into inventory so users can micromanage. “It’s a tool to help specialize inventory to meet customer demands.” Hockett says. The program shows how often a product turns and the dollars invested, helping retailers stock widely, not just deeply, Hockett says. It’s like having your own private inventory manager.

Store Manager Ryan Hackmann (The Ark Christian Bookstore, Yuma, AZ) says
he instantly got data that proved some things he ’d known intuitively about his
inventory. It also revealed other things. “I had preconceived ideas about certain inventory that proved not true.” He thought KJV Bibles were selling well; they weren’t. He saw that he had too many options for customers and was able to immediately adjust the category. “I can click two buttons and I know how KJV Bibles did yesterday.” He spends 15-20 minutes daily looking at the program; prints a list of titles that aren’t moving; has them pulled; and then decides what to keep, put on the sale table, or return.

Intuitive Screens—You and your staff will quickly learn and use Above the Treeline with its easy-to-read graphs. For example, an ATT user simply can go to the Titles Selling in Other Stores page, pick a topic such as fiction, and get a detailed report of titles on hand.

Weygandt says his staff can get feedback immediately. “It’s no longer a time issue waiting on an accountant’s report saying you overbought two months ago.” Above the Treeline has developed some healthy competition between staff—they’re working to stay “out of the red” and watching how other departments are doing.

Category Management—You’ll invest in categories that will lead to better inventory turns and increased sales. One storeowner was doing well in Bibles but knew she had room to grow based on a lower inventory that produced higher sales. She moved dollars from her gift category— which was over-inventoried—to invest in Bibles. Sales rose 15%-20%.

Coaching Sessions—You’ll find it easier to learn how to use the Web-based system with a mentor who’s familiar with the program and understands your store ’s specific goals.

Orientation Training—You’re not left alone to figure out how to use the program.

Web-Based Program—You can view your store ’s data (for one or more stores)
on the Internet from anywhere, at any time. Stores download information to and from the Web site, where it’s stored.

POS Compatibility—Due to ATT’s POS compatibility, both suppliers and retailers will be able to implement supplychain standards faster. All major POS systems
have been successfully test-polled for use with Above the Treeline. The program translates POS data into a common Christian Product Category language—a standardization crucial to the industry-wide supply-chain initiative.

For more information, contact Mike Hockett at (800) 252-1950, ext. 1228;
mhockett@cbaonline.org; or log on to www.abovethetreeline.com to access a
demo.

LISA TAMAYO is a CBA MARKETPLACE editor.