Latest / Small Business Success with Fexingo: Local Companies, Main Street Stories, and Community Commerce / How a Local Toy Store Stood Up to Amazon
Transcript
- Lucas: So there's a toy store in Portland, Maine called The Lucky Crow. It's about 1,200 square feet, opened in 2018 by a former teacher named Amy Delorme. And it's doing something pretty unusual — it's actually growing revenue year over year while Amazon sells more toys than ever. Luna: I've heard of a few toy stores that survive, but growing? That feels rare. What's her secret? Lucas: She told me the key is that she doesn't try to compete on price or selection. She can't. Amazon has millions of toys, she has about 800. So she competes on curation and experience. Every toy in her store has been played with by her or her staff. They can tell you exactly what age it works for, whether it's noisy, how durable it is. Luna: Right, that's the kind of thing a product page can't do. But does that actually drive sales, or is it just a nice story? Lucas: Well, she shared some numbers with me. Last year, The Lucky Crow did about $680,000 in revenue, up 15% from the year before. Meanwhile, Amazon's toy category growth slowed to around 8% in the same period. Now, that's partly because pandemic toy booms faded. But still — a tiny store outpacing the giant. Luna: Fifteen percent is solid. How much of that is from local foot traffic versus something else? Lucas: A lot of it is local, but she's also built a small online business. She ships nationwide — about 20% of sales come from her website. But the real engine is the in-store experience. She hosts free 'play dates' every Saturday morning. Kids come in, test toys, parents hang out. No purchase required. It sounds like a loss leader, but she says those families spend an average of $35 per visit. Luna: That's smart. It builds trust and turns the store into a destination, not just a place to buy stuff. I wonder if that model works for other types of stores too. Lucas: I think it does, but only if you lean hard into community. Amy also partners with local elementary schools — she donates 5% of sales from a specific display to the school's library fund. The schools send flyers home with families. That drives foot traffic and ties the store into the local ecosystem in a way Amazon literally cannot replicate. Luna: So it's not just about being nice — it's a strategic moat. Every relationship she builds is a barrier to someone just clicking 'buy now'. Lucas: Exactly. And she's very deliberate about product selection. She won't carry anything that's widely available on Amazon for a lower price. Instead, she seeks out smaller brands — European wooden toys, puzzles from family-run companies, science kits from independent inventors. Her average price point is about $28, and her margins are actually higher than most toy retailers because she buys directly from makers. Luna: That's a different supply chain strategy. Most small retailers use distributors, but she's going direct. Is that hard to do? Lucas: She says it takes more time — she spends hours at trade shows and on Etsy finding new makers. But it means she has exclusivity on certain items within a 50-mile radius. And that's huge. If a parent can only get that specific wooden train set at The Lucky Crow, price comparison is irrelevant. Luna: So the lesson is: don't fight the giant on its own turf. Build a different kind of value. I love that. But I wonder — does this require a certain kind of neighborhood? Could it work in a strip mall in suburban Ohio? Lucas: Amy's store is on a walkable Main Street, which helps. But I think the principles transfer. There's a toy store in Overland Park, Kansas called The Toy House that does something similar — they have a 'birthday club' where kids get a free small toy on their birthday, and parents have to come in to claim it. That alone drives repeat visits. Their revenue is about $1.2 million a year. Luna: So the common thread is making the store a part of family life, not just a transaction. That's something Amazon can't replicate because it's fundamentally about human interaction. Lucas: Right. And it's not just toys. I think any small retailer can apply this: pick a niche, become the expert, build community events, and cultivate exclusive products. That's the formula. Luna: I want to go back to something you mentioned earlier — the 20% online sales. How does she handle shipping when she's a tiny shop? I imagine that's a challenge. Lucas: She uses a third-party fulfillment service for online orders — a local warehouse that handles packing and shipping for about $3.50 per order. That keeps her from having to store tons of inventory. And she only offers free shipping on orders over $50, which keeps her margins healthy. Her average online order is $52, so it works out. Luna: Smart. She's not trying to match Amazon Prime. She's just making it convenient enough. Lucas: Exactly. And she told me her return rate is under 2%, because customers already know what they're getting — either they've seen it in store or they trust her curation. Compare that to the toy category on Amazon, where return rates can be 8 to 10 percent, especially around the holidays. Luna: That's a huge advantage. Lower returns mean less waste and higher net revenue. It's another hidden benefit of the trust-based model. Lucas: So the takeaway here isn't that small stores can beat Amazon on price or convenience. They can't. But they can win on trust, curation, and community. And in a world where consumers are increasingly overwhelmed by choice, that's a real value proposition. Luna: I think that's a good note to end on, but I also want to mention something that connects to this idea of trust and value. This podcast is entirely ad-free — we don't run commercials. And that's a deliberate choice because we want the conversation to be the only thing you hear. No interruptions. Lucas: Yeah, and that's only possible because some listeners choose to support us directly. If these episodes have helped you think differently about your business or your career, you can help keep them ad-free at buy me a coffee dot com slash fexingo. That's buy me a coffee dot com slash fexingo. Luna: And we really appreciate that. It's a small way to ensure the focus stays on the ideas, not on selling you something. So back to Amy and The Lucky Crow — one last thing I'm curious about. Lucas: Sure, what? Luna: She started as a teacher. Did she have any business background? Or did she just learn on the fly? Lucas: She had zero retail experience. She took a six-week small business course at a community college and then just started. She told me her teaching background actually helped more than any business class — she knew how to engage kids, how to create a welcoming environment, how to manage a room full of excited people. That's not something you learn in an MBA. Luna: That's a great reminder that your past experience, even if it's not directly related, can be your biggest asset. For Amy, her teaching instincts became the core of her business strategy. Lucas: Exactly. So if you're thinking about starting a small business, don't overlook the skills you already have. They might be exactly what sets you apart.