5 things every new retailer needs to learn fast
If you start a retail business, it can be a baptism of fire. WorldPay’s James Frost shares five tips to make the adjustment easier
Did you know? The total value of UK retail sales in 2015 hit a staggering £339bn.
This just goes to show that retail is one of Britain’s star sectors and, as consumers, we all know from experience which retailers deliver time and again. So, what can you do to emulate the best?
Here are five vital things new retailers need to learn fast to be a part of shopping success story.
1. Sell like a pro
Be it a safety pin or a safe, customers have access to reams of product information outside the store. Even then, you should never underestimate the power of a good salesperson.
According to research by global management consultancy McKinsey, nearly 40% of customers remain open to persuasion once they enter a store despite having already researched the product and its price through online reviews.
To close a sale, you and your salespeople need to know your product better than Google. You need to passionately demonstrate why the product is a must-have and be ready with answers for all the questions your customer might have.
That said, the biggest mistake salespeople make is talking more and listening less. Ask questions to uncover needs of the customer and then give them your sales pitch. If you’re friendly and fun to be around, customers are more likely to want to close the deal.
Finally, invest a little time and money to get your visual merchandising right so that customers get attracted to the product at the very first glance.
2. It all boils down to the price
This is the trickiest bit for any retailer – how do you keep the price low enough to close a sale and high enough to get the best margin? Always remember – every customer likes a good bargain. Sometimes it helps you land a sale even when a customer didn’t intend to buy a product.
Your costs and pricing strategies determine how you can get the best possible margin. First and foremost, know your market and adjust your costs so that you can offer a competitive price. Keep an eye on your rivals and ask yourself, “why would customers choose my product over theirs?”.
Offer a good marketing mix that includes “refer a friend” or “bulk buy” discounts that not only leads to sales but will also help you attract more customers in the long-term.
More importantly, listen to any feedback your customers might have on pricing and tweak your strategy accordingly.
3. Taking stock of inventory levels
Getting stock levels right is crucial for the success of any retailer. After all, you don’t want to be left with stock you can’t shift. Not having enough stock, however, obviously, means you have nothing to sell. To get your stock levels right, you need to get your projections bang on.
Make a list of your top selling items and how its demand has varied over the past few weeks and months. If your products are affected by seasonality, then come up with a plan of action for it. To use two very simplistic examples, chocolatiers and florists will see sales peak around annual holidays and special occasions, such as Christmas, Valentine’s Day, Easter, and Mothering Sunday. Competition for temporary staff and securing the best prices and products or materials from wholesalers will be harder in the lead-up, so planning and sourcing early will put you in a stronger position.
A big mistake you need to look out for is getting your stocktake wrong. Once you’ve got your projections decided, you can’t afford miscounts. Using bar code scanning is known to be a foolproof way to avoid that and can help minimise data entry errors.
Finally, use inventory software or Excel sheets to make sure you’re recording all your data carefully. Instruct any team members, that these documents are sacred for your business and its future.
4. Number game – managing accounts
No matter how amazing a salesperson you are and how appealing the range you’re selling might be, it all boils down to one thing at the end – numbers. Are you selling enough to pay your bills and make a profit? You should watch your accounts like a hawk and ensure you’re keeping a check on your costs so that they don’t eat into your profits.
Be it leasing or renting a retail space or new marketing activity budgets, your accounts should entail every possible cost your business is going to incur. You should also make a six-month, one-year and five-year plan with sales and profit targets you need to hit. Do a cost-benefit analysis of every new activity you’re undertaking to ensure you’re getting a return on investment.
These accounts will also help determine which products have got you the best margins and which times of the year your revenues increase or decrease.
5. Making payment simple
Time is money, both for you and your customer. That’s why you need to ensure you process payments swiftly and accurately, especially during busy times. So what options should you provide customers with? Cash, card and mobile are the most widely used payment methods that retailers should offer.
Juggling client payments and the admin associated with it could prove to be a Herculean task for retailers. There are stats to back this claim – in research conducted last year, payments provider Worldpay found small businesses typically spend around a fifth of their time on paperwork and admin. If this process is made seamless, then retailers can spend more time on growing their business.
This is where we believe the smart till My Business Hub – an all-in-one tablet-based point-of-sale solution – comes in. It comes with a detachable Android tablet to give retailers flexibility to take payments anywhere within your premises. Be it cash or card, payments, My Business Hub users can keep track of transactions through a business dashboard.
Losing customers to long payment queues is the last thing a retailer wants, that’s why using an effective system gets payments processed quickly while maintaining accuracy.
You can see how My Business Hub works by clicking play on the video above and for more information you can visit the Worldpay website or call 0808 278 1140