Inside the Container Store: Secrets of America's Favorite Stores

March 30, 2010— -- As Carrie Bradshaw from "Sex and the City" knows, the right closet can make all the difference.

And the Container Store couldn't agree more. For its organizational gurus a good closet means great business.

"It's been our best-selling product since 1978. Drawers and shelving to make the perfect closet," Kip Tindell, the CEO of the Container Store, said.

The store sells more than $100 million of its signature "Elfa" closet units every year. The unit has been such a company staple, the Container Store bought the Swedish company that manufactures the "Elfa."

Tindell says one of their secrets to success is how customers are approached in the store. The company discourages standard retail lines like "May I help you?" in favor of more specific communication with the customers about the products and special store events.

"You just have to have great people that love what they're doing and are really well trained. And somebody that says 'Can I help you' spurs kind of a subconscious response from the customer that 'No thanks, I'm just looking'…so we try to have true engagement," Tindell said.

Approximately 85 percent of Container Store customers are women, ranging from college students to young mothers to retirees. The store tries to have a feminine appeal including wider aisles to maneuver carts and children, carpeted floors for a cozier feel and popular items at eye level for the average woman's height.

"You want everything organized in a way to where they can get into the store, find what they want and get out as rapidly as possible. And they'll reward you for that by coming back several more times a year than if it's kind of a maze in the way people used to design stores," Tindell said.

The store has been ranked in Fortune's "Best Companies to Work For" list for 11 years in a row and has developed a dedicated following; many of their employees were once long-time customers.

Tindell said he has tried to create a so-called "yummy" corporate culture, which he hopes customers notice immediately.

"We call it 'air of excitement.' If you walk into a…retail store and everybody there is excited to be there, you can kind of sense that three steps in the door," Tindell said.

Container store employees receive 240 hours of training, most of it focused on becoming familiar with the products, compared to less than 12 hours at typical retailers.

Employees First, Then Customers

"We put the employee before the customer, even. And if you take care of your employee better than anybody else, they'll take care of the customer better than anybody else," Tindell said.

Tindell said the store always values feedback. In fact, some of their new best-selling items were suggestions from customers and employees.

"I don't need to hear how great we are again, I want to know what we're doing a thoroughly lousy job of," Tindell said.

He added that the feedback helps the store streamline their service and product selection as they ship 1,500 new items to more than 48 stores each year.

In spite of the recession, the store is starting to grow in urban markets such as New York and San Francisco as well as looking to expand to London or Tokyo, Tindell said.

People tend to nest during chaotic times, Tindell said, and Container Store sales have actually picked up for certain areas of the home.

"You know, you can't control the world but at least you can control your closet or your pantry or your home," Tindell said.

Web Extra: More Container Store Secrets

Their core customer is a woman, 35 to 65, leans in the older part of that range. They are very active, either at home or in business. They are very involved and are looking to save time, so the entire store is designed to save them time.

Every tag on products has information and uses for the product, not just the price. They call the price tag their "silent salesperson." Plus every campaign is highlighted with a display at the front of the store. The goal is to have the store look like their catalogue.

The company's two founders started the store in 1978 as a place to sell the weird, funky and multifunctional products that no one else in retail was selling, or products that weren't doing well. Many thought the company would flop.

Web Extra: Container Store Secrets

Some of the stores' most popular products are from its first year in 1978, such as the dairy crate or the popular toy barrel. The toy barrel was sold as a device for people in the country to burn trash in, but they turned it into one of their best sellers by slightly redesigning it and calling it something to put toys and soccer balls in.

There are 48 stores, each has 10,000 products and introduces 1,500 new products a year.

Its busiest time of the year is right after Christmas, when they put their top-selling Elfa closet system on sale. They try to capitalize on a common new year's resolution: get organized.

The store sponsor in-store "college nights" in July to help parents and students prepare for dorm life, offering demonstrations and discounts on various products.