Retail Musings

"How can money be the root of all evil, when shopping is the cure for all sadness..." Elizabeth Taylor

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Posted by on in Inventory
What to do with Clearance Stock

Clearance merchandise consists of products that have been permanently marked down for quick sale. These items may be handled in several ways:

  • Clearance items may be pulled together at the rear of each department. For example, clearance suits may be positioned on one or more fixtures at the rear of the career department.
  • Clearance merchandise from all departments may be pulled into one area of the store to form a permanent clearance department. This catch-all clearance department should be positioned in the rear of the store.
  • Clearance merchandise in specialty stores may be pulled to the front of the store for traditional major clearance events in January or early July.
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Posted by on in Inventory
Stock Turnover

Stock turnover is defined as the number of times during a specific period, usually one year, that the inventory on hand is sold. At a time like this a slow stock turn means that cash flow is lying on the shelves. It is not being turned into cash to pay your creditors and is a recipe for going bankrupt quickly.

In addition to cash flow, a high level of stock turnover in a business has several advantages for any retailer:
Merchandise on the shelves is always fresh.
Losses due to changes in styles and fashions are reduced.
Costs associated with maintaining stock, such as interest, insurance, breakage are lessened.
Your store has a limited amount of space. It must always be your objective to get the most profit per square foot out of your valuable space. Slow movers tie up valuable space.

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Posted by on in Inventory
Stock Rooms & Storage

Are you opening a retail shop? One of your important tasks is to design your stock room. Or perhaps you opened your shop but didn’t really give all that much attention to your stock room and now is the time to get your stock room in order

The high cost per square metre of many retail locations makes it tempting to devote almost every centimetre to the sales floor in order to maximise display space. Certainly the area devoted to merchandise display is the most important part of the shop, but few shops could survive without a rest room, unloading area, storage space and an office.

A comfortable and efficient office, stock area and employee break room make for a happy bookkeeping, buying and stockperson staff [even if it’s you!]. Few shops have enough room to make these areas as spacious as they should be. Remodelling money tends to get put first into the parts of the shop where customers can see it.

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Posted by on in Inventory
Stock Management - it's IMPORTANT

From a store's perspective, stock management means controlling the stock that is being bought so that customer needs are continually satisfied and maximum profitability is achieved.

Remember:  Merchandise is typically the largest single asset in a retail business and, as such, its productivity is critical when determining a retailer's profitability.

Effective Stock Management is important because:

1) Stock is Money
Stock is money invested and the profitability and financial viability of the retailer depends on the return obtained from that investment.
No stock or the wrong stock means no sales and no income. Since stock is the prime generator of revenue, having the right stock in the right quantities at the right time for the customer is fundamental.

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Posted by on in Financials
Setting the Right Price

There are many outside influences that affect profitability and a retailer's bottom line. Setting the right price is a crucial step toward achieving that profit.

Retailers are in business to make a profit, but figuring out what and how to price products may not come easily.

There are two costs associated with products that you must know before you can determine the best strategy in pricing your products. These are the COST OF GOODS and the amount of OPERATING EXPENSES.

The cost of goods includes the amount paid for the product, plus any shipping or handling expenses. The cost of operating the business, or operating expense, includes overhead, payroll, marketing and office supplies.

Regardless of the pricing strategy used, the retail price of the products should more than cover the cost of obtaining the goods plus the expenses related to operating the business. A retailer simply cannot succeed in business if they continue to sell their products below cost.

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Posted by on in Inventory
Controlling Your Stock Levels

From a store's perspective, stock management means controlling the stock that is being bought so that customer needs are continually satisfied and maximum profitability is achieved.

Remember:  Merchandise is typically the largest single asset in a retail business and, as such, its productivity is a critical determinant of any retailer's profitability.

Effective Stock Management is vitally important because:
Stock is Money
Stock is money invested and the profitability and financial viability of the retailer depends on the return obtained from that investment.

No stock or the wrong stock means no sales and no income.  Since stock is the prime generator of revenue, having the right stock in the right quantities at the right time for the customer is fundamental.

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Posted by on in Financials
Signs of Trouble Ahead

It’s easy to fall into one of two diametrically opposed camps at the moment: “The Oh Me, Oh My, We are all Doomed, Doomed I tell you” mob, or the slightly cocky and arrogant “Recession? What Recession – Stop Making Excuses – It’s all in your head” gang.

The truth – just like the hole in the doughnut – is probably somewhere around the middle.

It is important not to get caught up in perceptions and make decisions based on community sentiment – but to closely examine your own business and the things that you can control.

How long since you took your eyes of the economy and focused down into the heart of your business?

Here are some warning signs that you should be watching out for – the indicators that as well as the massive changes out on the marketplace it might now be time to implement some change –some improvements – of your own.

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Posted by on in Financials
Loss Leaders

Loss leaders are goods or services offered at steep discounts (generally below cost) in order to attract new sales signscustomers to a shop. It is a time-honoured practice that has been met with much success, especially by large discount retailers. The intent of this pricing strategy is to not only have the customer buy the (loss leader) sale item, but other products that are not discounted.

When to Use Loss Leader Pricing:
Move Overstock: If you have inventory that isn't moving or if you're overstocked on a particular item, a loss leader can move it. By cutting the price of such an item, you'll not only free up the shelf space and reduce inventory, but you'll also increase cash flow.

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Posted by on in e-commerce
e-commerce Today and Tomorrow

The world of e-commerce has long been the "ogre" that retailers and brands were trying to avoid. But the time has come to tame it - and the stakes are high for those that miss the opportunity.
People are shopping online for an ever-increasing number of products. Even product categories traditionally considered unlikely candidates for online shopping have been swept up by the e-commerce revolution.
This means that retail is now heading toward a single organisation that can respond to demand across multiple channels. Processes need to be integrated from source to sale. Retailers must have a more sophisticated understanding of their relationships with suppliers — all the way through to the shelf or point of sale, that moment where the shopper is engaged and motivated.

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Posted by on in Valentine's Day
Hanging Around

Your clothing shop is probably filled with hangers and racks to display your wearable wears, but for Valentine’s Day, trying a little hanging out.

Design one-day only hang tags to clip onto the regular store tags, an effort that won’t take up too much of your or your workers’ time.

Give customers a little something extra with their V-Day wear by cutting out hearts from card stock or thick paper in colors that match the store’s theme or traditional red and pink. Add text such as “We Heart Our Customers” or “Our Clients are the Sweetest!” Clip the hearts onto the clothes’ existing tags with a paper clip or small twist tie.

...
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Posted by on in Valentine's Day
Reach for Red

Appeal to last-minute shoppers with a promotion that’ll have them seeing red. Stalk the store and gather a couple of pieces of red clothing or homewares or books or gifts or tools (you get my drift...) you have.

Don’t take them all -- one or two in each size will be fine and will leave some back in their regular areas for shoppers who wander around. It’ll also be less for your team to clean up after the day.

Arrange a special promotional area at the front of the store on risers or stacks, T-shirts, socks, underwear and other clothing in the main shade of the day (ie Valentine’s Day). The same for whatever your product range...

For added color, sprinkle some pink and white around the display.

Buyers can create an entire outfit or set out of one-stop shopping for their entire wardrobe or might select that one item to get them into the Valentine’s Day rosy-red spirit

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Posted by on in Valentine's Day
Create a Theme

As Valentines Day approaches (and any event for that matter), take the opportunity to create a compelling and interactive theme display. 

Use products your shop is already pushing as you create the display. This can increase your sales and help you move your most profitable products as the next event approaches.

Creating a themed merchandising display also helps your store avoid costly leftovers that must be sold at highly discounted prices.

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Posted by on in Valentine's Day
For the Uncoupled

Most of us have been there at one time or another - facing the prospect of getting through a Valentine's Day as a "single" rather than a couple.

Consider doing something special and fun for the un-couples among your customers and visitors.

You could make your shop a 'Valentine's-Day-free-zone' and promote it that way. Consider what music you'd play... oh how the mind boggles!

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Posted by on in Valentine's Day
Love Yourself

Why should couples have all the fun? Whether you celebrate Valentine’s Day singly or as a couple, love yourself!

Create special “Love Yourself” promotions around your most pampering services and retail products, or gift free, store branded chocolates or relevant products with retail purchase to clients.

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Posted by on in Valentine's Day
Gift Basket

Make it easy for your customers to envision your products and gift certificates as "gifts" by pre-packaging gift baskets and displaying them along with gift certificates or gift cards for your business.  You can have real baskets in-store and photos of baskets on your website and social media.  Promote across all your platforms - not just one.

(nb: This is probably NOT the type of gift basket to give...)

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Posted by on in Valentine's Day
Poem or Acronym

This one can be used in-store(on sticky notes) , website, blog or facebook.

Ask clients to be creative and submit an acryonym based on the word "LOVE" (for example, an entry might be something like, "Lifelong Obsession with Valuing Everyone") or another word.

Or ask clients to get really get creative and submit a short poem as a contest entry (the poems can be cynical for your 'Singles' sake!)

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Posted by on in General Retail
Working with Your Partner or Spouse

Could you go into business with your partner? Retail has such a tradition of family owned and run businesses that it almost seems 'normal' to work together. But not every couple can handle the stress of day-to-day contact in a small shop without it taking a toll on a relationship. [I, for one, would not be able to do it...]

Try to look realistically at your relationship, your communication style, and your individual strengths and weaknesses before deciding if you would make good business partners.

One solution to working together is to have separate areas of responsibility and to trust one another to make most decisions within those areas on their own. It may help to divide almost everything into his and hers - even the office files. Do ensure though that you collaborate on all major decisions - even if you don't agree. Try to work out your disagreements in private, however, and present a united front to your staff and customers.

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Posted by on in General Retail
Is Your Instore Music Legal?

Music is an integral component of any successful retail store. Shoppers might not notice store signs, fixturing or store layout, but they are very likely to notice the sound. The right music at the right time can create a lasting impression, attracting customers and adding value through increased sales, productivity and brand presence. The wrong music can drive customers away...

But is the music in your shop being used legally? With increased accessibility to a wider range of music and technology, it’s understandable that some retailers are confused about what represents appropriate and legal use of music in business environments, especially with regard to playing recorded music within your shop.

As outlined by www.business.gov.au, you almost always need permission to play live or recorded music in your business or as telephone ‘music on hold’. This is to protect the rights of music creators, music publishers, performers and record producers and pay them for the use of their product. Simply buying a CD, for example, doesn’t include the right to play it in a commercial environment, such as a shop.

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Posted by on in General Retail
Early Mornings and Late Nights

You probably spend as much time at your shop as you do at home, at least during the first few years, so include a few amenities to make life more comfortable.

A small kitchen area with a refrigerator, microwave and sink will be appreciated by your staff as well. Make sure there is a place to relax, with comfortable seating and good reading light. You don't need to be stuck in a corner surrounded by stock!

During the day, the shop belongs to the public, but in the early morning or late evening, it's all yours. Enjoy the calm and solitude, and the opportunity to get some work done without the distractions of customers and staff.

...
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Posted by on in Musings
Game Changers

I was born in Tasmania. And I grew up on a dairy farm. Beautiful countryside but, hey, who cared? It was so far from everything.... or so I thought. I recently went back and visited. Not that far from everything after all (at a place called Elliott - between Yolla and Somerset on a Tassy map).

I was a curly haired child (still am 'curly' but thank God for hair straighteners and product!) who hated having my hair combed, brushed or touched. Still hate it. Back then I wore a hat and lied about having had my hair brushed..I was also a feline lover. Still am. Many a night I fell asleep with mother cat and kittens tucked up under my blankets, warm as toast.

I remember visiting my nanna who lived on the beachfront at Penguin. Standing in her kitchen I looked next door and was gobsmacked at what I saw on their clothesline. Coloured knickers! Couldn't believe my eyes. I wanted those knickers, those beautiful colours, lined up side by side. Much better than the boring white cottontails I had always worn.

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