I Opened My Retail Store. Now What Do I Do?
The Grand Opening was a success. Friends, family members, neighbors-- everyone showed up. And there were plenty of other people too who dropped by and told you how excited they are a trendy new boutique opened in the area. Sales exceeded your expectations and the POS System worked flawlessly.
But that was a few weeks ago. Lately not a lot of people drop by. The new store aura seems to have worn off. All the curious passer-bys have already dropped in for a look. They say they'll come back later, but most haven't. Your best friend has already run up a huge bill at the store. Sure, you get some good sales on Saturday. But that barely covers the rent and utilities.
You turn around and look at all the merchandise sitting in your store. Maybe you shouldn't have bought so much. Fortunately you got very favorable terms with your vendors but the 90 days are almost up and you need to start writing checks. There were so many unforseen expenses and cost overruns just to open the store. And now you have to pay for all the merchandise. What to do? You are tempted to run a big sale to generate some quick cash. But you know that would be a mistake. It would undo everything you've tried to create: position yourself as a high-end boutique. You run a sale and it's a death wish. Soon no one will buy anything in your store until it goes on sale.
You feel sick.
Comprehensive Reports for Retail Analysis
What you need is meaningful information. Fortunately, XpertMart's library of over 500 Retail Analysis Reports help you make critical decisions. Start with what you already have in inventory. With XpertMart you can run a report that will show you all of your Departments from best-selling to least. Looks like Women's Dress Shoes is doing well followed by Women's Casual Jeans. The same report lets you "drill down" and see within each Department which are the best-selling Styles. Now that you are looking at individual Styles you can see sales and stock side by side in a Size/Color matrix. You realize just by glancing at the report that you are out of stock in your two best-selling sizes and another size is dangerously low. Meanwhile several of those sizes haven't sold at all.
Time for action. You run the same report, this time sorting by vendor. You make some new Purchase Orders for those sizes that are sold out or about to sell out because they are selling well. Next, you go through your archive of Purchase Orders in XpertMart and look at all the orders that haven't been fulfilled yet. Some of the orders are for those same sizes and colors that have not been selling well! You call your vendors and see which orders can still be cancelled. Your run a report in XpertMart telling you the total new orders you've placed and use that as leverage with the vendor. The vendor agrees to cancel some of the older orders in exchange for the new.
Carry The Right Merchandise
Looking through the Best-Selling Departments report you realized that your inventory in Men's Shoes and Men's Pants have not been selling well. You decide to discontinue these lines and setup a discrete clearance rack in the back of the store. You figure you can safely put these items on sale without jeopardizing your reputation in your core business. Looking at the report, something else jumps out at you: jewelry has been selling very well. You agreed to take some pieces from a local artist as an experiment and they have been selling well. Maybe you should expand your jewelry line. You make a note to make some calls and invite other local jewelry makers to your store to look at their merchandise.
OK, you've made some good progress. You've figured out what merchandise is selling well and made sure you have it in stock. And you've identified merchandise that is not moving and decided to discontinue it. What else can you do? You run some more reports in XpertMart . You discover that you barely sell anything before noon and yet a lot of your sales are just before you close at 7 pm. You decide to try an experiment: you are going to open an hour later and stay open an extra hour in the evening.
You run another report and realize that of those two new girls you hired to work in the afternoon and work part time, Monica is selling four times as much as Jennifer. You will ask Monica later that afternoon if she can expand her hours and decide to scale back Jennifer so she is only there to help when new merchandise comes in and needs to be sorted.
You've been asking your customers, "How did you hear about our store?" and now you run a report breaking down your sales by customer origin. As expected word of mouth and walk-by are the two greatest sources. You're disappointed in how little business is coming from that magazine ad you ran. But a surprising number say they heard about the store on the radio. Next decision: renew the radio spot and cancel the next magazine ad.
Build Relationships With Customers
Sales have definitey been picking up lately since you started running a regular set of reports to keep an eye on your inventory. You call XpertMart and ask them for more advice. Is there anything else I can do to improve my business? One of the things you like the most about XpertMart is that they seem to really understand how retail works and are not just a bunch of computer geeks.
You decide after
your phone call that you need to focus more on building relationships
with your best customers. Fortunately you've been asking every customer
who walks through the door if you can put them on your mailing list.
You run a report to see who your Top 30 customers are. Some of the
names look familiar, others you have to really think about to remember.
There are a few surprises. That one woman who is always in the store
and is very talkative barely made the cut. The man who drops in
real quick about once a month to buy a gift for his wife is actually
one of your top customers. And what really catches your eye is that
combined these 30 customers represent over 40% of your sales! It
sure makese sense to keep these customers happy.
So now you run another report to see when the last time each of these Top 30 customers were in your store. You are momentarily alarmed when you realize that 12 of the Top 30 have not been in the store in over a month and 5 of them in over 2 months! You wonder if there was something they didn't like about their last trip to your store. You decide to immediately send them a gft certificate. You also have a talk with your sales staff and tell them that they are to be treated as VIPs.
We Know Retail
There are a few other ideas you decide to implement. You start asking customers for their birthday, or at least the month they were born. From now on every customer gets a 25% off coupon the month of their birthday. The XpertMart guys said other users had good success with this strategy.
You also run a report that sorts customers by Brand and Collection. This way you can see which customers have bought a particular brand in the past or collection. You setup a new experiment to try. The next time a designer comes out with a new line you are going to send out invitations to customers who like this designer and invite them to a special wine & cheese party some evening where they can preview the merchandise. People like feeling special and this might be a good way to pamper some of your best customers.
You don't even think of your XpertMart software as a POS system anymore. Sure it does all the basic point of sale functions any retailer needs. But it's so much more than that. The information it's giving you is helping you run your business.