During it’s centennial year, Dick Hite of Norton Ditto decided to share one of the key aspects of his success. Since 1908 Norton Ditto has been the premier fashion retailer in Houston Texas. From the early days when the store’s typical customer arrived at the downtown store in a horse and buggy to the Texas oil boom of the eighties, Norton Ditto continued to grow. They opened a second store on Post Oak Blvd in the prestigious Galleria area, Houston’s shopping Mecca. Even with the growth in sales, like so many traditional retailers, Norton Ditto struggled to remain profitable and experienced some tough times. Mr. Dick Hite, the nephew of Ben and Sarah Ditto learned the retail business while working in the store from 1969 – 1984. In 1994 when he returned to the store, he became the principle owner and CEO, and took on the challenge to restore Norton Ditto to profitability and success to become today’s quintessential Men’s Clothier in Houston. Mr. Hite shares with us some important lessons that have contributed to Norton Ditto’s success.

Though well experienced in the retail industry as well as his experience in sales and marketing (he was a frequent speaker for the PGA), Mr. Hite looked outside his already strong staff for additional assistance to develop a management plan. One of the most important relationships he developed was with Management One®, one of today’s best retail management consulting groups, to develop a rapid ROI (Return On Investment) strategy to maximize the two largest assets of Norton Ditto: their people and inventory. Mr. Hite admits that while he and his staff had previously used management and merchandising plans from other consultants, the key to their success was “that Management One® not only provided better plans, but they were also able to motivate us to follow the plan. ”

It is no news that retailing is a cash flow business that must maximize sales and turn rates. By increasing turn rates, a retailer will improve cash flow, reduce markdowns, increase margins, and indirectly increase sales. Management One’s focus is unique in that it’s not solely directed toward tightening the belt (Open to Buy) to maximize turn rates. The focus is also on helping the retailer develop opportunities to expand the business by re-investing dollars that were previously overcommitted in non-performing classes into new lines and classifications with growth opportunities. Breaking out classifications so that growth can be tracked more effectively results in inventory dollars spent with a much better return.

As examples, Mr. Hite points to his neckwear and belt classifications that were performing poorly and are now very profitable classes with neckwear selling through at 85% (and trust this author who has been in his store - he still has a fabulous selection of ties!) Yet he acknowledges that sometimes the raw numbers don’t tell the whole story. He admits that if he looked at the numbers only he wouldn’t be carrying Oxxford suits, but he knows his market: one can’t be the premier haberdasher of Houston and not carry Oxxford suits. “It’s all about the right balance of merchandise,” explains Mr. Hite.

Marc Weiss, one of the principles of Management One®, calls Norton Ditto a “text book example” of what good controls and discipline can do for a retailer. Evan Wise, the other principle of Management One®, emphasizes that a key turning point is when a retailer deals with issues they can influence rather than making excuses due to circumstances beyond the retailer’s control. Inventory planning, balance and the right OTB at market is one area that every retailer must control. Mr. Hite applauds the responsiveness of Ed Scott, his Management One® consultant: “It’s much more than a monthly review of our merchandising plans; it’s the daily support that makes their service so valuable. Moreover, Management One® is in tune with and truly understands the retail business.”

In 2007 Smyth Retail became part of the Norton Ditto partnership by providing the underlying information system which effectively manages daily transactions and provides important reporting and analysis tools, including a direct interface to the Management One® “Winning @Retail” merchandising planning system. The entire Smyth organization was so committed to helping their POS customers get the most from the data their system collects, they provided the direct interface to Management One at no added charge to customers. That interface makes it easy for Norton Ditto to send the information to Management One quickly, accurately and easily over the Internet. Management One processes the information and the report can be returned over the Internet as well. This seamless and efficient process provides Norton Ditto with timely and accurate analysis of their business. Mr. Hite affirms there is “no doubt that the timeliness and accuracy of better reporting tools provide the information to quantify and qualify management’s decisions. ” The ability to get a snapshot of the status at any time during the month using Management One’s Plan-On-Demand (POD) feature is important to helping us reach the planned goals established for the month.”

Mr. Hite sums it up best: “There is no doubt that through effective planning and execution that we have increased turn rates, margins and sales.”