A tough economy requires doing things differently. As a management professor, I reminded my students daily, "if you keep doing what you keep doing, you'll keep getting what you keep getting." The tough part is to see what needs changing.
For small retail businesses, you have probably become too close to the issues to see needed change. And with tough economic times, hiring an outside consultant isn't in the cards either. Here are a couple of things to look at to try and boost sales. If you try them and they work, please let me know! I love using success stories when talking to others.
1) Are your business hours right? Many times you are open for hours before anyone ever crosses your threshold. Either shortening a day, closing a day, or staying open different hours will generate additional business. Keep track of customer sales on a paper with boxes on it; one for every hour you're open, by day. When a customer comes in put a tick-mark in the box. If they buy something, put the amount in the box too. Do this for several weeks before you analyze what you see. Often you'll see how you should adjust your hours to boost sales and reduce salary expense-both winners.
2) How is your merchandise arranged? Do you know what products sell well together? Are your shelves packed? Are your shelves visible from the check-out? Cluttered shelves scream that you have excess product; which you might have-see number 3. Simple arrangements of merchandise that often sell together can prompt additional sales. This may jumble merchandise around the store, but average sales tickets generally increase. Also, can you see your customers shopping? If not, you can't quickly suggest a complementary item. Many studies have shown that a suggestion by a sales clerk increases average sales per customer.
3) How long do you keep merchandise on the shelf? Purge items that haven't sold after a particular amount of time. Deciding what that time period is the difficult problem, depending on your type of store. Generally, 3-6 months is used by many retail stores. After a product has been on the shelf for 90-120 days, you should first discount it to try and gain a sale. Give this another 30-60 days (depends on your business). If it hasn't sold by then, create a clearance table and discount a little more (but not lower than your cost). Leave it on the clearance table 2-3 weeks. If it still hasn't sold, determine what organization could benefit from your donation and take the cost as a write-off. It is far better to have fresh merchandise, than to continue showing old, and possibly out-dated merchandise each time your customers come to your store.
I hope these several ideas help you survive in this economic downturn. Additional ideas and consulting is available.
