Driving sales in Retail starts with the basics. Below I have listed the key elements in Retail for you.
- What drives the highs and lows in your business?
- What is the actual performance vs budget and previous periods?
- Do you have a clear understanding what impacts your net profit?
If you know what impacts your business you can set up clear actions to improve or maintain the quality of your business. The more data you have the better you can control your store. Tip: Do not forget the non-financial KPI’s.
- Does your assortment match the needs of your customers? With other words do you target the right group with the products on offer?
- What pricing and promotion strategy do you use?
- If you differentiate from the competition by assortment: do you make sure it is unique?
- Is your assortment in line with the core identity? Branding, theming..
We all know without the ‘right’ products it will be very hard to be profitable. Make sure you know your target group. It makes no sense to sell flowers in a store focused on children. Besides to know your target group make sure what you sell matches the experience. Why would we sell electronics in a theme park? Despite the possibility it will become a best seller, which will make it harder to delist! It is easy to add products to your assortment (which do not have any relation with the experience you offer) in times of low performance hoping it will capture the loss. The hard part is to discontinue these products when these are in your top 20. Before adding products to your assortment challenge yourself on experience. How would you sell this product to your marketing director?
- Do you know your stock management cycle?
- How do you ensure on the shelf availability of your best products?
- Are you aware of your dead stock?
Collating data and forecasting is key! Since every business is unique in its own way you should have identified how the stock management cycle looks like for your store(s). A good relationship with your suppliers is key to solve ‘ad hoc’ out of stock issues (which will occur someday). Know the lead times and forecast visitor volume by using the lead times. If your system won’t be able to give you a signal when you need to reorder I advise you to set up a stock management tool in Excel. Dead stock was already a waste upon purchase and will be a bigger cost when it sits in your stock room and take space in the shop. Not talking about the pressure on your open to buy budget. Make sure you have identified your dead stock and implemented the right actions for clearance.
- How do you want to treat your customers?
- How do you make sure your team will deliver the customer service standards?
- How do you handle complaints?
It is all about service! Make sure you deliver what you communicate and know how to go the extra mile. In terms of staff: do not compromise with recruitment and only hire employees which match the person specifications. Hiring the ‘wrong’ person can cost you customers!