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DC-Area Store Owner Bets on Future of Photo Retailing

November 2002

When Tom Jacobi took over an existing Electronics and Camera business 20 years ago, photofinishing was barely part of the mix. Now it's his main focus. "Photofinishing accounts for about 70% of our sales today, and even a bigger piece of our profit," says Jacobi, owner and president of Langley Image Center and Palisades Image Center, both within a 15-minute drive of downtown Washington, DC. "Overall, the move to photo retailing, and especially to in-house photofinishing, has been a good decision."

In 1982, Langley Electronics & Cameras in McLean, VA sold cameras, televisions, VCR's and high-end audio components, as well as offering on-site repair service. It outlabbed the photofinishing customers brought in.

A decade later, Jacobi put in a one-hour lab and began seeing steady growth in that business. Over the years, photofinishing grew bigger and more profitable. Hardware sales became increasingly competitive and less profitable. In the mid-90s, Jacobi decided hard goods couldn't sustain a business anymore. So he dove head first into the world of photo retailing by affiliating with the Kodak Image Center Solutions program.

Image Center Solutions is 'Natural Fit'

"It was a natural fit for us," Jacobi says. "I was trying to figure out what brand name to align myself with. Since a big part of the Kodak Image Center Solutions program is fixtures and upgrading the look for the store, it made my decision very easy. Out went the high-cost, low-volume hardware. The shelves were stocked instead with frames, albums and film. A Kodak Picture Maker was added as the company's first foray into digital imaging. And overnight, Langley Electronics & Cameras became Langley Image Center.

Today, Langley Image Center features a Noritsu QSS-2711DLS digital lab system as its photofinishing workhorse. The digital lab system produces everything from wallet-sized prints to 12 x 18-inch enlargements (and the full range of sizes is displayed on a large wall).

"The 2711 and DLS architecture open up all kinds of possibilities," Jacobi says. "It's a high capacity machine. We can do almost twice the volume as we do in our Palisades store on the (Noritsu) 2901 system. You also have the option of tying in to other digital devices, like the Picture Maker."

The digital lab system features a short-term Work-In-Process (WIP) digital storage buffer. Jacobi's staff keeps their customers' develop-and-print orders in the WIP for about two weeks, so that any reprints ordered during that time can simply be printed from the existing digital files. The customer doesn't even have to come back to the store to place an order.

The day Photographic Processing visited the two stores, a young mother strode purposefully out the front door of Palisades Image Center as she shuffled through the prints she had just purchased. Then she abruptly reversed course and returned to the front counter. "I think I'd like a 5 x 7 of this one," she told sales associate William Pelkey, pointing to the print on top and specifying exactly how she wanted it cropped. A few minutes later, enlargement in hand, she left the store again.

"To a customer like that, we can sell an enlargement and a frame and make more money in a few minutes than we did on a VCR," says Jacobi. "That's why the move to photo retailing was a no-brainer."

Two years ago, Jacobi opened the second location, Palisades Image Center, on the western end of trendy Georgetown. It features a Noritsu 2901 digital lab.

Customers Want Service, Quality

Jacobi acknowledges he's in a rare position. He has positioned both Image Centers as a part of their respective communities. There are no warehouse clubs or mega-retailers but there are the drugstores close by to offer low-priced competition. But then, he doesn't particularly want customers who buy based on price. "Price-sensitive consumers aren't very loyal customers," he says. "We have an upscale clientele that appreciates quality and a high level of customer service, which is exactly what we provide."

That's not to say he doesn't do promotions. Both stores have a Wacky Wednesday special designed to bring customers in to shop on what is traditionally the slowest day of the week. The Wacky Wednesday special is a multiple choice offer: with every roll of processing a customer gets either a second set of prints, $2 off, a free CD, or online posting of the images. "There's something that will appeal to everyone," Jacobi says. A second set of prints is the most popular option, but CDs are becoming increasingly popular with the computer-savvy.

Both stores charge $12.95 for a sheet of Picture Maker output (either an 8 x 10, two 5 x 7's, four 4 x 5's, eight wallets, or any other combination that will fit on a page). Though the Picture Maker is available for use as a self-service workstation, most customers let an employee do the actual work. "We give them good service, and they get a good-looking print, quickly, so they're happy," says Jacobi.

Jacobi's stores offer everything the Image Center Solutions program requiresincluding on-site photofinishing, Kodak film, albums, frames and photo gift items.

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