From spending time in store with independent retailers this year there are common issues of things they want to get right.
These include how to improve overall margin, how to hire and retain great staff, and how to move shoppers away from just buying promotions.
Improving margin demands discipline and focus. The discipline is to measure what is happening in your shop. Focus is about paying attention to how your cash invested in product is working for you. The metrics that you need to use include stockturn and wastage.
Retailers who are disciplined about counting stock in and counting it out and knowing daily sales and profit are retailers who make more profit and have greater control over their businesses. Many choose to join a symbol group or franchise because it reduces the huge numbers of decisions to make.
Really great retailers set their ambition for their shop and what the customer experience should be and work backwards
For the purpose of this article let’s agree that only five out of 100 retailers have good daily and weekly sales data that tells them how their business is doing.
The danger for these retailers is that data is only a guide to the past and what they need to do is to work on the future.
In discussion with retailers this year, my advice has been to focus not on your category with the highest sales and disappointing margins, but to look for the products that have good margins and are selling more. Think about who is buying that product and then make it easier for them to find it.
The second issue has been recruiting and retaining great staff. Again, the weakness seems to be a lack of process. This starts off because people have low expectations of shop work and who will do shop work.
Some retailers know their businesses offer a great opportunity for people to make money and enjoy their work. They tend to have a written job description listing the shop worker’s key tasks and a person specification of the behaviours and attitudes the worker needs to display.
Really great retailers set their ambition for their shop and what the customer experience should be and work backwards to define the work that needs to be done to achieve this and, from this list, can set the tasks that each shop worker needs to do.
If your team is clear about the business’s goals and their role in making it a success, you have a chance of engaging them in moving the business forward.
Finally, so many retailers complain about shoppers only buying £5 bottles of wine when they are on promotion and not buying when the price goes back up.
If when a customer enters your store they have to navigate past slabs of beers on promotion and special offers that shout about good value, what shopper would not be happy buying whatever was available at £5. You have told them it will be good.
Unlike the first two issues there is no easy answer. You need to learn more about your shoppers. If they are only ever going to buy wine on a deal, live with it and move on to areas of your store where you can make a difference.