Fine tuning your retail store ... 1

SPECIAL Fine Tuning Your Retail Store For
ACTION BIGGER PROFITS
REPORT In The First Decade Of The New Millennium
The face of retailing began to change in the 70s and this change accelerated
through the 80s and 90s.
A complimentary report
provided by an Today, early in the 21 st century, retailing is a science ... not something to do
independent BBG… while you’re waiting for other opportunities to arise.
Business Development
Specialist Now, if you think the changes to date have been “mind boggling”, just wait
until you begin to experience the full impact of this new millennium.
Our purpose:
Only those who really know what they are doing will make money.
To provide practical
business information
that works…
Your survival through the next decade will largely depend on how you elect to
Guaranteed! cope with the changing circumstances and, specifically, how you chose to deal
with the impact of the Internet on retailing.
In particular how to:
If you decide to adopt the “she’ll be right attitude” ... give it away right now,
Increase Sales
Reduce Costs and save yourself a “bundle” ... because you won’t make it!
Improve Productivity
If you are deadly keen about making a career in retailing, surviving the next
Better Business decade and making money to boot, you will need to be businesslike, street-
Group Ltd
smart, market oriented and customer centred.
Serving Australian and
New Zealand Business. Businesslike
U5, 51 Perry Street
Retailing is a business (not a hobby). You open the doors every morning to
Bundaberg, Qld 4670 make money. By all means enjoy the day ... enjoy demonstrating the products
Phone: 1300 711 743 ... but never lose sight of the fact that you're there to do business and make
Phone: +61 412 667 559 money.
Fax : +617 3036 6174
Email:
bbgau@betterbusinessgroup.biz You need to have plans, goals, budgets, staff, stock, premises, attractive store
layouts, security systems, etc, etc, etc.
BBG New Zealand
1329 Akatarawa Road You need to understand and practice the basics of business ... you need to
Upper Hutt 5372. know what makes your business “tick”.
New Zealand
Phone: +64 4 5266880
Fax: +64 4 5264024 Street Smart
Email: Your business does not operate in a vacuum. You have competitors, both
bbgnz@betterbusinessgroup.biz direct and indirect. Everybody today is competing for a dwindling number of
Presented By: dollars.

It is possible for you to lose a potential sale of a computer to the
refrigerator salesman, simply because you didn't properly sell the "missus"
on the benefits ... after all, the couple only had enough money to purchase
one item!
Page 1 of 9 Copyright © Fred Steensma

Fine Tuning Your Retail Store For BIGGER PROFITS In The First Decade Of The New Millennium

The street-smart retailer wins more than his fair share.

Street-smart retailers know what is happening around them and how it will impact on their
cash register. They constantly alter their approach to retailing as they monitor the events
around them in much the same way as a skipper of a yacht constantly trims the sails to make
the best of the prevailing winds.

Market Oriented
Nothing happens until you make a sale. You know that!

Retailing is one business where the customer traditionally comes to you. Will this change
over the next decade?

The street smart, market-oriented retailers are already practising ways of going out to the
customer.

Direct mailers, catalogues, coupons, telemarketing, special promotions, networking and party
plans are just a few of the techniques with which they are experimenting.

Will they make the sale while you just sit behind the counter waiting ... and waiting ... and
waiting?

Customer Centred
On average, you will lose approximately 15% of your customers each year through natural
attrition ... death, moving address, etc.

Two other worrying factors have emerged for retailers:
Customer loyalty is not as strong as it used to be.
Customers are more mobile, better educated about, and more aware of, their buying
alternatives.

Thus, complacent retailers in the new millennium will quickly see their customer base eroded.
So, to survive the new millennium you need to be customer centred.

You need to “love” your existing customers ... you need to be constantly on the lookout for
new customers.

All of this requires a cohesive marketing plan and a super-strong employee training program
to ensure that the customer is recognised as the “King”.

The early warning signs that you may not be coping with retailing are:

A blood pressure reading gives medical specialists some insight into the future well-being of
a patient. It is a monitor of health. Likewise, the following are “bell weather” warnings that
your retail business is not performing well and needs to be seriously examined:

Page 2 of 9 Better Business Group Ltd Copyright © Fred Steensma
Australia- U5, Perry St, Bundaberg, Qld 4670 - +61 412-667 559 or 1300 711 743– Email: bbgau@betterbusinessgroup.biz
New Zealand- 1329 Akatarawa Rd, Upper Hutt 5372, NZ - +64 4 5266 880 - Email: bbgnz@betterbusinessgroup.biz


There have been significant changes in the demand for your goods and services

Monitoring devices:
Daily customer counts
Average sales per customer
Slow-moving stock
Sales by product group
Informed discussion with suppliers and other shop owners.

You are experiencing severe cash flow shortages

Monitoring devices:
Bank balances
Levels of stock, creditors and debtors
Most importantly, try to find the reasons for the cash flow shortages.

Increased activity from your competitors

Monitoring devices:
Old-fashioned “espionage”. What are they up to? Visit their shop, speak to their
employees, speak to their suppliers. Learn to second guess their next moves.

Falling employee morale
This is perhaps the best barometer of them all.

Monitoring devices:
The powers of observation
Ask employees for their input

Changes in suppliers’ attitudes

They won’t persist with losers.... nor with those who continually ignore their marketing
advice. Seek their help as much as possible. They can share the experiences of other retailers
and the results of their many thousands of dollars invested in marketing know-how. Don’t
you be the one to try to re-invent the wheel.

Increases in customer complaints

Customer complaints must be treated seriously. They are indicators that you are not pleasing
the one person who pays the bills. Don’t forget “passive” complainants either. They’re the
ones who vote with their feet and never come back to your store ... and they won’t tell you
either ... they just “fade” away.

The following is a small selection of questions designed to be thought provokers. The list is
by no means exhaustive, merely an introduction to the kind of scrutiny you will need to put
yourself (and your business) through if you intend to survive and thrive.



Answer the questions honestly. If any apply to you, take note … the warning bell has
sounded. It’s up to you to instigate some immediate changes.
True Partially False
True
Self
I don’t believe I can influence the future direction of
my business
I know I should have personal and business plans in
place, but I don’t
I don’t bother to seek advice ... after all, I’ve been in
this business a long time
I don’t spend as much time with my family and
friends as I should
I could get more done in the day if I didn’t have
interruptions
I haven’t yet trained anybody to manage the store in
my absence
I don’t really enjoy my business anymore
I could be more effective if I was in better physical
shape
I am working too many hours
My wife and family resent my business
I occasionally set the standards for the shop by being
seen to do menial functions, then everyone knows
they are to be done by anyone

Personnel
I am the person in charge, I don’t need to sell
I am unable to find good staff
I don't conduct staff training sessions or staff
meetings
My staff haven't been given written job descriptions
Trying to define and measure the result of each
employee would be a waste of time
My staff know they’re good, so I don’t need to tell
them
My staff have not been trained in the techniques of
selling
The quality of service falls when I am absent
I don't believe in staff reward systems
My staff are rewarded for extra effort
My staff know how to merchandise
My staff are well-trained salespeople
My staff know all policies and procedures
My staff know how to act and always act on my
behalf if I am unavailable


True
My staff regularly give me ideas on how to improve
My staff want our business to succeed
My staff are looking at our competitors

Customers
We don’t use customer complaints as a means of
improving the business
We don’t bother with special promotions just for our
regular customers (or some other function to make
them feel special)
Our average sale per customer is decreasing
I wouldn’t have a clue what our average sale per
customer is
We don’t bother to record the names and addresses of
our new customers
We don’t bother with a regular customer newsletter
or bulletin
We are losing business because of inadequate follow
up of existing customers
My customers know what they want, I don’t need to
show them
I don’t advertise
I advertise and no customers come in
My store is merchandised for my target and
secondary customers
My customers tell other people about me and my
business and generate extra business for me
I don’t know if my customers are complaining - they
don’t tell me

Finances
There has been a downward trend in our business
over the last twelve months
We currently have cash flow problems
I don't have a very good credit rating ... nor does the
business
The amount of debt that the business is carrying is a
problem or a potential problem
We don't have emergency lines of credit in place
We try and avoid the bank manager ... because he
might ask us how we are going
I don’t bother with financial figures



True
I don’t really understand such terms as:
average mark up
average stock turn
break even sales figure
average weekly overhead expenses
Our books and records are not up to date
Our tax payments are usually on the late side
I accept most forms of credit cards
I have a cheque policy in place

Marketing
We don’t keep a record of our marketing efforts
We don’t keep a record of the marketing efforts of
our competitors
We don’t bother with surveys or market research
before going after new business ... we just do it and
hope it works
Our marketing campaigns and promotional materials
don't produce repeat business
I don't bother to read newsletters, magazines and
journals on new marketing ideas

We don’t bother about getting free PR exposure
We don’t bother with asking staff or customers to
volunteer their suggestions
We never hold special meetings or ask for help on
how we can increase business to our existing
customers and to find new customers
The newspapers or radio stations do my advertising
for me
I regularly do a catchment of potential customers
I regularly look at the postcode of my customers
I look for trends and capitalise on them
I do the marketing without any outside influence
We don’t get our best clients’ phone numbers
I don’t ask for referrals

Product and Premises
The shelves of our store are looking a little tired and
empty
It's ages since we altered the layout of the store
Nobody has ever told me that shopping in my store is
exciting


True
Presently, the external and/or internal presentation of
my store is looking a little tired or tatty
I keep my excess stock in the store room not
merchandised on the shop floor
I keep my signs lit at night, until passing traffic
dissipates
I know every product has an add-on and what it is
My staff know every product has an add-on and what
it is
I order replacement stock
I regularly clear dead lines at cost to free up cash
flow
I develop a relationship with the staff of my suppliers
to get an advantage when special deals are available
or extra service is required
I look at increasing my range of products to cope
with the changing face of retail
I regularly drop lines that no longer sell
My premises say “WELCOME” to anyone who
walks in the door
I use point-of-sale material in my store
I keep point-of-sale material up to date
I make my business easy to deal with

55 Power Principles To Help Your Store Make More Money

This information has been designed for you to better understand the strengths and weaknesses
of your business strategy. In order to improve business, you have to find out what is missing,
and what can be added to improve your effectiveness. With careful planning, you can look
within your business to find new ways to enhance sales and to improve customer service,
operational procedures, and your overall marketing position.

Here’s a comprehensive list of practical ideas, methods, tips, and techniques to set your
business apart from the competition and make it more productive, efficient and much more
profitable:

CUSTOMER ANALYSIS:

1. Find out who your customers are and what they are seeking.
2. Profile your customers by age, income, occupation, etc.
3. Know the reasons why customers shop at your store? (service, convenience,
dependability, quality, promptness, or competence, etc.)
4. Understand the market forces affecting the consumer's attitude when it comes to price and
what they expect to pay.



5. Emphasise areas of appeal, such as special sizes, lower prices, better service, wider
selection, good location, or convenient hours.
6. Offer unique products at prices your customers can well afford.
7. Have a tracking system for how many customers shop at your store every day.
8. Seek suggestions from your best customers on ways you can boost business.
9. Try to re-establish lost or inactive customers.
10. Use a store questionnaire to aid you in determining customers’ needs.
11. Plan on making any changes to satisfy the new value-conscious consumer.

CUSTOMER RELATIONS:

12. Improve your return policies.
13. Make it a policy to give cash refunds when requested by the customer.
14. Offer customers a “no-hassle” satisfaction guarantee.
15. Use a suggestion box and customer want slips.
16. Extend your store hours.
17. Accept a wide range of credit cards.

18.Analyse complaints and take action to prevent recurrence.
19. Train employees to deal with customers in a professional manner.
20. Call customers to let them know when new items have arrived.
21. Have lots of convenient parking for customers.
22. Have a clean bathroom available for customers.
23. Grade your store's location every year in regard to accessibility.
24. Create a system to let customers know how much you appreciate their business.

MANAGEMENT SKILLS:

25. Use advertising techniques to create urgency and to motivate customers to buy NOW!
26. Test different aspects for promoting business: new offers … new items … new prices …
special announcements … stronger ads … and better headlines.
27. Know what type of advertising methods work best to attract customers (direct mail,
newspaper, television, radio).
28. Use memorable advertising that sets your business apart from the competition.
29. Create new opportunities for customers to purchase more frequently from your store.
30. Implement proven business formulas of other successful retail firms.
31. Replace outdated methods with new techniques and better resources for retailing in today's
high-tech, fast-moving, and competitive marketplace.
32. Set up an inventory control system in regard to shrinkage, performance, amount of
merchandise, mark-up, profit, and turnover.
33. Determine whether to price certain items below, at, or above the market.
34. Utilise a system for tracking slow-moving merchandise and those products that are your
best-sellers.
35. Use different ways to arrange and display merchandise that will make it easier for
customers to buy.
36. Know your average sales transaction and what you can do to increase it.



37. Increase your sales transactions by offering better prices, more value, sales incentives, or
add-ons.
38. Know which products are price-sensitive to your customers … that is, when a slight
increase in price will lead to a drop-off in demand.
39. Know the maximum price customers are willing to pay for certain items.
40. Computerise your business to help streamline everyday tasks, such as inventory control,
point of sale, and overall business analysis.
41. Evaluate the amount of inventory you carry and fine tune your operating expense ratios on
a regular basis.
42. Buy distinctive merchandise that fits into a niche your competitors don't have.

INSIGHTS FOR A SKILLED MARKETER:

43. Attend trade shows that provide the latest technology, inventory systems, educational
seminars, and other industry-related resources.
44. Use newsletters as a “marketing tool” to remind customers of the products or services you
provide.
45. Create a budget for both regular and off-price merchandise, and know what role they
should play in your buying strategy.
46. Establish dependable resources where you can buy current, name brand and designer
merchandise below wholesale prices.
47. Make an effort to buy promotional and off-price merchandise to improve your profit
margin.
48. Buy private-label merchandise to avoid the same-line prices of your direct competition.
49. Join other stores like yours in area-wide buying programs to receive better prices or trade
discounts.
50. Do cross-marketing by joining forces with restaurants, clubs, or whatever to jointly
develop special promotions.
51. Join trade associations and subscribe to newsletters and trade publications to keep you
informed.
52. Involve employees in making suggestions for improving business and cutting costs.
53. Implement a program to reward employees for their extra efforts and innovative ideas.
54. Empower employees to make important decisions, even if it means losing a small amount
of money to make your customers happy.
55. Don’t let emotions get in the way of making sound business decisions.

SUMMARY: Your business can’t survive without customers!

To succeed and prosper, you must learn effective procedures and become an expert in your
area. The key is to control your expenses, refrain from overbuying, re direct your open-to-buy
only to profitable resources, and develop a better strategy.

The success of your business will be in direct proportion to your insights and management
skills. The bottom line is this: If you don’t do an exceptional job of training employees and
motivating customers to take action or don’t do the strongest job to sell them once you have
their attention, you are cheating your company of profits.


Fine tuning your retail store ... 1

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