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October 2003

Retailer showcase:

Reasons for their success

The reason for the discount success is simple, explains Van Huyssteen. It starts with his enormous warehouse and is driven by the strength of the major chains that can leave a footwear brand stranded with thousands of pairs when a futures order is cancelled. “I recently bought 12 000 pairs after a big order was cancelled — at a much reduced price,” he explains.

At the end of season, most brands are stuck with odd sizes and broken ranges — which they are keen to sell to a willing buyer.

But, while Van Huyssteen gets — and offers retailers — low-low prices on these lines, he has forged good relationships with several distributors, which enables him to buy new and popular models at excellent prices. In-store prices therefore vary from R100 for older models to R1 300 for the latest styles. About 70% of sales are, however, in the R100-R400 price bracket.

All these benefits are not only passed on to his own retail and franchise stores, but also to other retailers that they wholesale to.

Although part of the same Sport City company, the wholesale division is run by Gert Claassen as a separate business unit. They also import and distribute well-known international brands like surf brand Vans, the outdoor boot Nevados, skate brand NSS and Avia — a lightweight sport shoe especially popular amongst women, that is currently the top seller in Tekkie Town. “Avia is popular because it offers excellent value for money,” he explains. “A R500 Avia shoe compares very well with other models costing R900 -R1200.”

The brands that they import are distributed and marketed nationwide to all retailers.

Ever alert to a good deal, Van Huyssteen keeps his ear close to the ground and is constantly planning new ways of expanding the business. Whether it is taking over the running of a brand’s factory outlet, or buying all the stock of a brand changing hands, or expanding into more technical footwear and different sporting codes… one thing is for sure: Tekkie Town is on a run!

Tekkie Town is not tacky

There is a vast difference between cheap and the affordable footwear offered by the Tekkie Town franchises. On the day that the latest Tekkie Town store opened in a new shopping centre in Brackenfell, the access road was still incomplete. Visitors had to park a block away and wind their way through mud and road works — enough to deter all but the most determined shoppers

And yet, Tekkie Town was packed with customers. All determined to benefit from the exceptional low opening prices and give-aways like the skateboard with every pair of skateboarding shoes … while stocks last.

“This is quiet compared to our other openings,” a smiling Braam van Huyssteen, MD, sets the record straight. “Tomorrow, when the road opens, we’ll be swamped!”

In the five years since they launched the first Tekkie Town and Sport City franchise, this Mossel Bay company has shown the market the difference between cheap (tacky) and affordable (Tekkie style).

And the customers love it.

Lured by clearance specials, they are offered a pleasant shopping experience with attractive displays, good lighting, carpets, music — everything they would expect to find in an upmarket mall store. And even if they do not find a clearance size to fit, the chances are good that they will buy one of the other discounted models — which could even be one of the latest styles on the market.

Discount stores are nothing new. But, a discounter that sells just about every upmarket brand — including surfing brands that are normally very discerning about who they supply — is unusual.

No Mr Average

But then, Van Huyssteen is not your average run of the mill guy — although his down-to-earth approach and jovial demeanour could easily lull you into mistaking him for just an ordinary chap next door that happens to own a retail chain.

He learnt to enjoy the unusual side of life soon after completing his business studies at Stellenbosch, when he became one of two male troepies recruited to do his training at the army college for women in George. He did their accounts, though, and did not have much chance to march with the women.

Thereafter he joined his brother Marius, who owned the Tropika sport store in George, when they opened another branch in Mossel Bay.

About five years ago they opened the first Sport City (sporting goods) and Tekkie Town (just footwear) stores in George. They now operate three Sport City stores and six Tekkie Town’s, plus more than ten Tekkie Town franchises. There will soon be 22 branches.

While the original franchisees were given a free hand in the layout and design of their stores, new stores have to adhere to a certain standard, explains franchise manager Michael Brown. Apart from having to conform to standards set out in a manual, and afford to buy stock, franchisees do not pay any franchise fee.

“But they have to make a commitment to be in the store every day — we are not looking for investors. We want jockeys who are keen to run a business,” says Van Huyssteen.

He believes that they have a responsibility to the brands they stock to ensure that the stores look attractive, with quality branding and a pleasant vibe that will make the customers feel good about shopping there — even if they pay discount prices.

“We stock all the top names and I believe you can destroy a brand if you do not clear them properly,” he says. “Sure, anyone can attract people with low prices, but you always have to consider what it does to the image of the brands you stock.”

They also strongly believe in offering a good service and staff training. Staff members have to write regular exams as they are expected to know what is happening in the market and have to be able to answer customers’ questions about footwear technology. They also have magazines — including Sports Trader — on hand to provide back-up information.

The name “Tekkie” — colloquial Afrikaans for white sport shoe — conjured up a familiar, homely image for the predominantly Afrikaans-speaking customers in the platteland towns where the first franchises opened. Branches in East London and Port Elizabeth followed, but their move into the marketplace was initially subdued. Until two years ago, when they opened a large store in Somerset West.

This was followed by a 150 sq m store in Tokai, 300 sq m in Worcester, which will soon followed by 300 sq m in Bloemfontein, 500 sq m in Port Elizabeth and 600 sq m in Centurion.

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