Great Retailers

One of the great things about my job, is talking to passionate retailers around Australia, and being able to train their staff.

In this modern world, with all of us having access to the global shopping world in our pockets via our smart phones, it is important that we do not forget what being a great retailer is all about. As a retailer, you can no longer just open you doors and expect your customers to flow in and buy your products. Customers are spoiled for choice.

Do your know your customer?

Do your research, watch how your customers move through your shop, what catches their eye? Most of what you need to know about your customers happens every day in your own store, you just have to have your staff ask the right questions. 
Do you ask your customers that are leaving without buying anything what they were looking for? Ask the question, many customers will just look and if they cannot see what they need, and no one asks them or offers assistance, will just walk out empty handed.

What are your customers buying?

How do you track your sales? Have your staff write down everything that a customer asks for that you do not stock. This is something that I have done many times in Stores I have run, and it will surprise you how many times staff write down items that you already stock. You will also see what extra items that may be worth stocking. If the demand is there and customers are asking for it, you should seriously look at selling it.

Are you buying your stock at the lowest price?

You make a profit by buying at the lowest price, and lowest freight costs. Retailers focus too much at times on the selling price and overlook the buying price. Negotiate volume discounts, or payment term discounts. Be creative, look for package deals, or are there parallel importer / suppliers.

Look after your customers

It amazes me how hard we make it in some stores for people to shop. There are always rules and policies that someone in Head Office or administration has created that slows the purchase down. Keep the whole process as simple and quick as possible.
It also amazes me how many people working in retail hate customers! My answer, change careers.
Genuine friendly service will always help to close a sale, and build repeat customers. It costs nothing to provide and the returns can be huge.

Show the customer the price

There is a common theme that I keep seeing in those retailers that get it right:

The staff are engaged, love their job, love talking to customers, and solving their problems.

When recruiting, hire for character, and train for skill! Works every time.

Good trading,
Geoff

Customer service - It is all about me, the customer!

We have had a few office discussions recently about customer service disappointments, you know those times when the service that you receive was not what you expected to receive. It really got me thinking, that it is very true, that most complaints stem from not the way that the sale or transaction was performed, not from the actual shopping experience, but most complaints come from how a mistake is either ignored or corrected, or how a bad outcome was handled.

We are human, mistakes happen, we all expect something to go wrong at some time. You know the drill, the item won't scan at the checkout, a price check is called, the checkout operator has no idea how much the item is, they ask you, but I have no idea either, even though I would have looked at the price when choosing that item, I never buy anything without checking the price. For the time it takes to get the price, in labour costs it would have been cheaper for the supermarket to just give you the item! My time is valuable, the checkout operator's time is valuable, no one wants queues, or to wait in a queue, but they happen. How long would you wait before complaining? What is an acceptable time to wait? It all depends on what you are doing next, what you were doing, how many things you are buying. If I think back, I get the most impatient when I am only buying two or three things, don't mind waiting when I have a trolley full!

A recent situation highlight what drives people to make a complaint about the service they received. As we discussed the experience, each step from the outside, seemed reasonable, not great, but not too bad. What tipped the situation was the manner in which they were spoken to. Not what was said, but how the staff member addressed the customer. It is then that all the individual experiences get put together to make the whole experience not good enough and worthy of a quick email to customer service to get dealt with.

I must say in this situation, it was handled brilliantly and proved that with the right PR procedures in place, a "I WILL NEVER EVER GO TO THAT PLACE AGAIN" was quickly turned into a "They listened to my problem, apologised and I will see how they have improved next time"

I know that in my previous career, some of my most loyal customers were those that were at one stage my biggest customer complaints. If you fix it right, you will win them forever.

Keep looking after those customers!
Geoff

Retail careers

Why not a career in retail?
I was one of those kids that took on a casual job in retail, never thinking of it as a career option. It was a choice made at the time to earn some cash and buy a car, driven mostly by living in the bush, no public transport, and nothing to do. Money, your own money gives you choices, options to decide what you do.

30 years on, still involved in retail, now I am focused on helping those starting out in retail to have the skills and knowledge to be succesful and earn their employees plenty of sales. Looking back now, I have no regrets and have certainly enjoyed the journey. I am glad I did not listen to my career advisor at school, who at the time could not understand why I would be leaving school to work fulltime in a discount department store.

Why is it that many people do not consider retail as their first choice? I know that many people that have never worked in retail do not understand the many jobs and tasks that are needed to successfully run a modern retail business. There are numerous job roles behind the scene to keep the stock rolling in, the shelves full of the correct stock and to keep teh customers walking in the door.

Many people end up in retail jobs and make it a career after not finding employment in their chosen field, and go on to be Store Managers, Regional Managers and earn very high salaries. Unfortunately many people when you say that you work in retail, think of you as a "shelf stacker", or a "checkout chick". When without those postions being filled by people like me or you, we would still be out hunting for our dinner!

The retail industry needs to be proactive in promoting retail careers to raise the standard of retailing in Australia, improve store standards, and especially improve customer service standards. Many employees focus on hiring junior casual staff, never offering them permanent work, and not giving them many shifts as they get older. This generates turnover of staff, the hidden costs of recruitment and training, and reduces loyalty to the business. This gives the retail industry a bad image and does nothing for the previously mentioned standards.

With all that said, would I encourage one of my children to work in retail?
Too right, the wide range of skills learnt can be applied into any field you choose to move into at a later stage.

Good trading, keep those customers happy,
Geoff

The Christmas count down is on (or should be!)

Today, 14/11/2011 is, 41 days to Christmas day 2011.
Are you as a retailer ready to capture your share of customers?
It's not too late to, there are still a lot that you can do to make this season as profitable as possible.

My top 10 things to check are;

1. Product - If you haven't ordered those key items, place an order this week with your supplier. As volumes increase, the logistic streams reach capacity and deliveries are often late. Customers are impatient and will not or should not wait for the stock to arrive. Keep an eye on hot / new items, check if more stock is available as a rush order if needed. If you haven't got it, you won't sell it!
2. Price - Customers, whilst starting to spend again, will still be shopping around for the best value. Check that your prices are set at the correct level. Always be prepared to move on seasonal items. Any christmas related merchandise will be hard to move post Christmas day, and it will cost you money to hold it until next year.
3. Place - Have a good honest look over your shop. Stand outside the front doors as a customer. Now close your eyes, 1,2,3 open, what do you see first? Would you be enticed to come inside? Does your shop look like it is managed by the Grinch? Get in the spirit and put up decorations, and carry the theme through from front to back. Remember also, that the frequency of visits increase over the next 40 days, so keep the store looking fresh at all times.
4. Staffing - You do not want to get to the busiest week of the year and find that all your staff plan to have a holiday! Lock in your rosters now. Your staff will need some time off to enjoy the season and recharge, but working in retail, they have to expect to work when you need them. By forward planning and gaining a commitment now, the next 40 days will be a lot easier on everyone. Preplanning will help to avoid any surprises.
5. Supplies - Nothing is worse than running out of shopping bags or register rolls 2 days out from christmas! Check and place top up orders now from your regular supplier, for all consumables, pens, paper, bags etc. If you have last years order history, check and use that, if not keep a record now for next year.
6. Maintenance - Check this week that everything works and avoid paying a hefty call out fee on christmas eve. Also check that you have a current list of emergency call out numbers for all the key areas. Also check that your key staff know where the emergency callout phone list is!
7. Promotional planning - Nothing should occur adhoc. Plan now for what promotions you will have each week / day for the next 40 days. Theme each week as you count down to Christmas. Last minute idea suggestions, impulse ideas, gift register, there are many ways to give your customers a reason to buy from your business. Stay on task, focus on your customers, listen to what they are saying and adjust your approach as needed. Check that your staff know what is on special and when.

8. Watch your market - Be aware of what everyone else in your market is doing. That does not mean that you should copy every idea you see. You just need to do it better then they do. What your competitors are doing may not work, but be aware just in case it is a winner idea / concept.
9. Keep records - Christmas happens every year! But when you talk to some retailers you would be forgiven in thinking that it was the first christmas that they have seen. A good way to prepare and be ready is to keep a diary or list by day of what you did and what worked and did not work. This will avoid many costly mistakes from reoccuring next year. To succeed, you need to make mistakes to learn. But you should never make the same mistake twice.
10. Have fun and enjoy the season - Your customer will quickly sense your feelings. No matter how hard your day is, no matter what is going on, you must always give a great impression on your customers. A strong customer service focus cannot stop just because you are busy. Christmas should be and is a joyful time of the year, a time to celebrate with those we love and cherish. Reward your staff in what ever way you can, acknowledge their hard work. The rewards do not have to be monetary or elaborate, a simple gesture of nibbles and drinks in the staff room and coupled with a few well chosen words of thanks can do wonders to the moral of your team.

May the cash registers ring loudly for the next 41 days,

Good trading,

Geoff

Trust-a lesson often learnt to late

What does it mean to your business to have someone’s trust?

What does it cost to gain someone’s trust?

What does it cost to keep someone’s trust?

Whether it is a customer, a supplier, a business partner,or an employee, trust is something that whilst it is hard to put a definitive price on it, it can ruin even the strongest brand very quickly.

Trust in business was explained to me once at a training session in this analogy, by someone who I cannot remember, but their basic message has stayed with me for many years.

Your business is like a bucket under a dripping tap. The water dripping out of the tap seems worthless, without the bucket it would quickly disappear, evaporate, soak into the soil and not be seen, or be missed by anyone. However with the bucket (your business) under the tap, the drips of water (the trust) slowly collect and increase in volume (value). Over time the bucket fills up and you now have a reserve supply of water (trust in your business). Small events may happen that reduce the volume in the bucket, but there is still plenty left, what value do you now place on the full bucket of water? However when something significant happens and the bucket is tipped over, all the water (trust) is lost very quickly, it is almost impossible to stop the spill. You now may feel great loss for all the water (trust) lost, which cost you nothing in the first place to collect. If only you had done more to protect the bucket from falling over.

In any retail business you will always have events that push on your bucket, an upset customer, late deliveries, an unreliable staff member etc. It is how you respond, and it what way and how quickly that can keep your bucket upright, keeping the value in your brand, your business.

Many businesses invest a large amount of money in advertising and marketing to build trust and recognition in their brand, only to put significant strain on the trust through events that are not at all times managed correctly. Most situations can be fixed more cheaply if handled quickly. Time costs money, emotions build, and the spilling of trust commence.

Next time something pushes your bucket, stop and think. What damage potentially could this have on my brand? What value do I place on this relationship? Do I need this customer to come back and shop again? What future sales may I put in jeopardy?

Whilst we are all smarter in hindsight, if you were the CEO, would you have grounded your airline without warning? If you were the CEO of a book chain facing financial trouble would you have declined accepting your own gift cards from your loyal customers? What damage does not having that catalogue item in stock for the start of the catalogue? What do you think whenthe price scans up wrong at the checkouts for the second week in a row, did you pay the correct amount for the rest of your purchase?

Gaining and keeping trust is a life long lesson, which unfortunately too often is learnt the hard and most expensive way. Good trading, Geoff.

Retail, what next?

With all the uncertainity in the financial markets, share market volitilty and the slide in the US dollar over the past week, even the experts cannot predict even closely what will occur next.

What chance has the average small retailer owner operator have of being able to know how many orders to place, or what new lines to look at stocking?

How will the average customer react to all the changes that have occured over the past week alone;

• US Dollar has dropped 10c, which will put upward pressure on imports
• Fixed mortgage interest rates have started to fall, which may indicate less increase pressure on the variable rate.
• Share Markets have been running up and down in 5% swings in very large volumes, lots of on edge investors!
• The Recession word is getting used a lot more, self fulfilling prophecy?

We are constantly being told by our Political leaders that our Nation's financial fundamentals are good and it does appear to be correct, especially when compared to overseas economies.
So why does what happens on Wall Street, effect us so much? A lot of what happens, particularly in the share market, just comes down to the fear of being caught out and losing your hard earned cash in a major slide. Australians have a very high ownership of shares now, but many investors do not have a good understanding of the triggers that drive the market. Many investors buy for the correct long term reasons, but sell quickly on the first bad news received, or just because everyone else is selling.

The effect of the last few weeks will not be felt in full by Retaillers until several weeks time, hopefully by then we will be heading into the summer christmas season, when most Retailers make their profits for the year and the financial world will have stabilised and consumer confidence will have returned.

Come on Australia, open your wallets and start spending!

I can't see the clothes for the signage!

Currently as I walk through shopping malls and look in apparel retailers it is immediately apparent as a customer that stock is in bountiful supply, full size range still available in almost every style towards the end of the winter season, with spring and summer lines making their way on to racks as well. There seems to be no better example of a downturn in customer shopping (buying) habits than in the many clothing retailers. When money gets tight, or that extra cash is put into the mortgage just in case interests rates go up, one of the first discretionary purchases that is often put off until later is new clothes, as long as last year’s jeans still fit!

As a result of the long overseas supply lead time in Australia, orders are normally placed a season ahead based on what was sold previously and with an increase factored in based on current trends. This long lead time is due to us not having a local clothing manufacturing industry any more; clothing is sourced predominately from Asia and the Subcontinent with their low production costs that cannot be matched in Australia. Most clothing retailers do not want to get caught out not having enough stock to meet customer demand, and the attractive bulk purchase rates will always entice that extra few cartons to be ordered. A half full container costs the same to ship as a full one!

With this backlog of cartons that I imagine are still sitting in the stock rooms and reserves everywhere, comes the difficult decisions for the Management teams to take.

Do we discount the stock to get it moving?

How much do we discount, 20%, 50%?

What do we do if it still does not move?

Spring / Summer stock is arriving, do we put out now?

Do we box up the winter unsold stock and hope that it is in fashion next year?

As I look through the many clothing shops I visit, being the dutiful Husband and sit outside fitting rooms with the other similar Husbands (wishing we were mowing the lawn or out fishing), one point really stood out.

I cannot see the Clothes for the signage!

This was not in just one Store, but every Store we went into. Large racks bulging full, straining so much that when you try to remove one coat hanger five more fall off, causing the already over worked staff member to sigh and keep bending over picking up. The amount of signage screaming out in all colours and fonts, neat handwriting and messy, crossed through with extra markdowns, it just went on and on.

Many Stores still were also trying to use that amazing merchandising item, which is still held in high regard by many Store teams. That item that they hope can make the difference and sell all those thousands of dollars worth of inventory sitting idle, clogging up the supply chain all the way back to Shenzhen.

The sale balloon!

What is the solution you ask?

Well unfortunately this season is over for many clothing retailers. Many racks I saw still had full size ranges and were priced at 70% of the original price. The profit is now probably gone!

They can try to clean up those racks and free up space so that they can be shopped easily. We walked out of many Stores empty handed as it was just too hard to shop and find what we needed or may have been interested in.

Clearance lines must be looked after and displayed with as much detail and love as the new season apparel. Many markdowns can be saved if correct merchandising is adhered to throughout the season. Try merchandising clearance lines by price point, i.e. $10 racks. Try merchandising by size if volume permits.

And the most, most important point of all is to have sufficient staff allocated to keep the racks clean and well presented. No one likes to have to ‘dig’ through a stack of tangled garments and coat hangers just to save a few dollars to buy a garment that no one else has wanted to buy.

In summary,

The entire season’s profits can be quickly eroded if the correct disciplines are not used during the clearance phase in Apparel retailing;

·         Continue merchandising the clearance until sold (if you ignore the clearance lines it will hurt your bottom line in a big way!)

·         Only take markdowns as needed, the smaller the better, review daily as needed until the sell through rate increases.

·         Do not over do the signage; you have to see the Clothes still!

·         Keep the racks clean and tidy at all times

·         Rearrange, reposition as necessary, and keep the displays fresh. If it looks the same, your regular shopper will walk straight past.

·         Keep the balance right between clearance and new seasons garments. Watch the weather and adjust the balance as needed, daily if required.

Come on summer