Latest / Small Business Success with Fexingo: Local Companies, Main Street Stories, and Community Commerce / How a Local Hardware Store Used Workshops to Beat Home Depot
Transcript
- Lucas: There's a hardware store in Portland called Cedar & Oak Hardware. It's about two thousand square feet, family-owned, and it sits five blocks from a Home Depot. By any conventional retail math, it should be a ghost town. Luna: Right, because Home Depot has fifty thousand square feet and can slash prices on nuts and bolts. Lucas: Exactly. But Cedar & Oak has something Home Depot can't replicate easily: a Saturday morning workshop where eight people learn how to fix a leaky faucet. And that workshop is the engine of their whole business model. Luna: So the workshops aren't just a community-service thing — they're actually driving revenue? How? Lucas: They charge nothing for the workshop. But the average attendee spends forty-seven dollars in the store that same day. And the store tracks that thirty-day repeat rate — it's about forty percent. So these workshops convert lookers into regulars. Luna: Interesting. So the upfront cost of the workshop is essentially a customer acquisition cost. What's the cost of running one? Lucas: I talked to Jenna Kwan, who owns the store. She said a two-hour workshop costs them about one hundred and twenty dollars — that's for an instructor, materials like a small piece of pipe or a switch, and coffee and pastries. They run two per weekend, so about two hundred and forty dollars. Luna: And if each workshop has, say, ten people spending forty-seven bucks, that's four hundred and seventy dollars in revenue from the workshop day alone. Plus the repeat visits. Lucas: Right. The math works. But the real win is what Jenna calls the 'trust premium.' When a customer learns how to fix a toilet flapper in her store, with her staff showing them hands-on, they're not going to go to Home Depot for the replacement part. They'll buy it from her, even if it's a dollar more. Luna: That makes sense. But does that trust translate into bigger-ticket items? Because a toilet flapper is cheap. A lawnmower or a power tool is where the margin is. Lucas: It does. Jenna told me that tool sales — things like circular saws and drills — are up about twenty percent year-over-year, and she attributes that directly to the workshops. People who take a furniture assembly class feel confident enough to buy a drill. They know they can come back and ask questions if they mess up. Luna: So the workshop de-risks the purchase. I've seen that in other categories — like when a bike shop teaches you how to fix a flat, you're more likely to buy a bike from them. Lucas: That's exactly the parallel. The broader retail trend here is sometimes called 'edutainment.' But what I like about Jenna's approach is that it's not about making the workshop entertaining — it's about making it useful. People leave with a skill, not just a coupon. Luna: And there's a social component too. I bet people meet their neighbours at these workshops. That's something Home Depot can't offer. Lucas: Absolutely. Jenna said that after the first few workshops, regulars started bringing friends. The store's email list grew from about four hundred to over two thousand in two years. And they send a weekly newsletter with tips and upcoming classes. It's a content engine that feeds foot traffic. Luna: Alright, but let's be honest — not every independent hardware store can pull this off. What are the prerequisites? You need a staff member who can teach, you need space, you need liability insurance. What if you're a one-person shop? Lucas: Jenna has three full-time employees, and she's there most days. But she started small — just one workshop a month, taught by herself. She's a former contractor. So the first prerequisite is having someone on staff with practical know-how. If you don't, you could partner with a local handyman or a trade school student. Luna: That's a good tip. And the space issue — a two-thousand-square-foot store can't have a dedicated classroom. How do they manage? Lucas: They clear the front corner of the store, set up two folding tables, and use a portable demo board. It takes fifteen minutes to set up and ten to break down. They run the workshops before the store opens, so it doesn't interfere with customers. Smart logistics. Luna: So the barrier isn't really space or cost — it's the willingness to treat the store as a teaching space, not just a retail floor. That's a mindset shift. Lucas: Exactly. And Jenna has data that proves it works beyond the anecdotes. She tracks a metric she calls 'workshop to cash register conversion.' For each class, she notes how many attendees make a purchase that day. It's consistently above eighty percent. And the average basket of a workshop attendee is thirty-five percent higher than a non-attendee. Luna: That's a massive difference. So the workshops are basically a funnel that self-selects for motivated, higher-spending customers. Lucas: Right. And those customers become advocates. Jenna had a story about a woman who took the electrical basics class, then went home and rewired a lamp. She posted a photo on Instagram tagging the store. That one post brought in five new workshop sign-ups. Luna: User-generated content from a physical class — that's the kind of marketing money can't buy. And it feels authentic because it is. Lucas: So authentic that Jenna has never run a paid ad. The workshops are her entire marketing budget. She estimates that every dollar spent on a workshop generates about six dollars in attributable sales within sixty days. That's a six-to-one return. Luna: Six to one is impressive. But what about the long tail? Do people keep coming back after the initial class? Lucas: Yes. They offer a progression: Plumbing 101, then Plumbing 201 where you install a toilet. Then a 'Fix It Night' where you bring in your own broken item. People cycle through three or four classes over a year. Jenna says the most loyal customers are the ones who've taken at least two classes. Luna: So the workshops create a ladder of engagement. The customer goes from curious to competent to evangelist. Lucas: Exactly. And the beauty is that Home Depot can't copy it easily. They could offer workshops — and some do — but the dynamic is different. At a big box, the instructor is often a vendor rep who doesn't work there full-time. At Cedar & Oak, it's the owner or a staff member who will remember your name next time you come in. Luna: That relationship is the moat. And it's free to build — you just have to show up and teach. Lucas: Which brings me to something I want to mention. This kind of show — digging into how small businesses actually win — it takes time to produce. And it stays ad-free because a handful of listeners chip in through buy me a coffee dot com slash fexingo. That support is what keeps us digging into stories like Jenna's instead of running ads for mattress companies. Luna: Yeah, and we really appreciate it. It means we can stay independent and focus on what's useful — not what sells. Lucas: So back to Portland. One thing I found really clever: Jenna uses the workshops to sell the stuff that has the highest margin — things like specialty faucets and vintage-style hardware. She orders them from small manufacturers that Home Depot doesn't carry. So the workshops actually showcase products you can't find anywhere else in town. Luna: That's a double lock. Not only do customers trust her, but they can't price-compare because the product is unique. She's created a local monopoly on certain items. Lucas: And the margins on those specialty items are forty to fifty percent, compared to twenty percent on commodity nuts and bolts. So the workshops steer customers toward the profitable stuff without them feeling sold to. Luna: It's like a loss leader, but the loss is just time and coffee. And the leader is knowledge. Lucas: Exactly. Jenna told me that her overall gross margin is about thirty-eight percent, which is healthy for a hardware store. Industry average for independents is around thirty-three. She credits the workshops for those extra five points. Luna: Five points is huge. So the question for any small retailer listening: what skill do you have that you could teach for free? Could be knife skills at a kitchen store, plant care at a garden center, or even how to pack a suitcase at a travel shop. Lucas: Right. The format is portable. And the key insight from Cedar & Oak is that when you teach someone something, you become part of their competence. They don't just remember your store — they remember that you helped them become capable. That's a bond no big box can replicate. Luna: And it's worth repeating that Jenna started with just one workshop a month, taught by herself. So the bar to entry is low. The hardest part is deciding to try it. Lucas: Which is exactly the kind of decision that keeps Main Street alive. For Cedar & Oak Hardware, a Saturday morning with eight people and a pipe wrench turned into a business that's growing in the shadow of a big box. And that is a pretty good lesson for anyone.