The Container Store Retailing Philosophy

The Container Store can deliver the best products with the best customer service, but not at the best price.

We continue our series sharing summaries of principles The Container Store follows to achieve its long-lasting success. These principles are detailed in the book, UNCONTAINABLE, written by Kip Tindell (co-founder, ceo and chairman, The Container Store).

The Container Store Retailing Philosophy

uncontainable_150Kip Tindell shares a great story in the book about a conversation he had with retailing pioneer Stanley Marcus of Neiman-Marcus fame. They were discussing the importance of a retail business having the right mix of products, service and price.

Kip recalls the conversation…

I loved to talk with Stanley Marcus about selection, service, and price. Stanley always said that if you do one of these things really well, you’ll be very successful. He said if you do any two of them well, you’ll have the number one business in your niche. Then he said you can’t do all three because price is absolutely mutually exclusive to both selection and service.”

The best products with the best service at the best possible price is nearly impossible to do.

Zappos can lay claim to selling the best products with the best customer service but not at the lowest price.

Costco competes brilliantly on selling products at a very low price but that comes at a cost. They do not have the best selection nor do they have the best customer service.

The Container Store would love to, in Kip’s words, “… hit the triple crown every day—offering a well-edited, carefully curated collection of 10,000 products, free expert advice and service that customers delight in, and prices competitive with the mass merchants.” But they can’t.

The Container Store can deliver the best products with the best customer service, but not at the best price.

As a former retail marketer for Whole Foods and Starbucks, I know firsthand the struggles dealing with price perception issues. Whole Foods especially struggles with the perception its prices are too high. It’s true that one can buy cheaper natural/organic food elsewhere and one can buy a cheaper latte from someplace other than Starbucks. However, Whole Foods and Starbucks have found retail success by not competing on lowest prices.

I really like Kip’s perspective on a retailer competing with higher prices. Kip writes…

We’re not the only retailer that gets an unfair reputation when it comes to price. But it’s the retailers that focus solely on price that get the credit for great pricing. And it’s surprising to me how overcredited discounters are for pricing and how unfairly retailers who focus on service and quality are marked as overpriced.”

The Container Store, Starbucks and Whole Foods all suffer from being known as too pricey. However, these higher prices result in better products with better customer service. If I’m starting a retail business, I’d focus on delivering better products and service. Yes, prices will be higher but the overall experience will be richer.

The Container Store posting series:

  • Hiring (Oct. 13)
  • Training (Oct. 14)
  • Selling (Oct. 15)
  • Leadership (Oct. 20)
  • Vendor Relations (Oct. 21)
  • Retailing (Oct. 22)
  • Manifesto (Oct. 23)