5 Key Ingredients For The Perfect Retail Business
Starting your own retailing business can be hard work, but is also very rewarding. Working in a retail environment takes a great deal of creativity, some fantastic communication skills, as well as business acumen. When it comes to running a shop as part of a big chain, you sadly develop your abilities and plow a lot of hard work and imagination into making profits for somebody else. But imagine if you owned the business, and all of the effort you put into making it grow could be repaid to you when it starts to turn a profit. You could be proud of your achievements, and know that you did them for yourself and your own future.
Get A Concept
One of the most important things that you need in the retail business is a strong concept. Think about the niche that you will be working in; make sure that it is broad enough to warrant an entire store to it. Maybe try and do a bit of market research using social media before you start up your store in order to get an idea of the demand for the business, and the types of products you will sell.
Think about how you will market the business. You will need to have a clear understanding of who will be shopping with you. It ‘doesn’t always follow that the target market of the product is the demographic of your store. You might find that the majority of your products are bought as gifts by partners or parents. Make sure that your product is angled in a way that sells to both the end-user and the buyer.
Think Branding
The next thing to think about is branding. How will you get across who you are, and what you do by using just your name and brand logos? Make sure that your branding is uncomplicated, and will translate visually onto your signage.
You’ll need to come up with a clear message that ‘you’re going to put on the signs for your shop. Try some blind testing with your logo, branding, and name. You can get people to complete online surveys to test their reactions to your branding.
Hire a graphic designer to help you get a logo design that really stands out. They will be able to help you get the most influential design possible.
Buy Quality Products
Buying is important. It can be challenging to gauge how well something will sell when you are starting out, unless you have had previous experience selling the same product elsewhere. You should look at similar products on the market, and make some comparisons for research. Try and find out about how well your products have sold elsewhere too.
Making a buying decision involves taking a risk. The more you spend on a product, the better the profit margin. However, you don’t want to be stuck with extra units of a line that won’t sell.
The safest option when you are starting out is to buy test orders of the lines you are interested in stocking long term. Really pay attention to the speed that the first orders sell through before committing to buying more at favorable rates.
You need to know when to drop a product from your range and have an exit strategy for that line. Slow-moving lines take up self space in your store and are effectively dead money. Don’t be too precious of your margins, and if you need to discount it to just a little over cost plus tax, then at least you are making space and keeping your range fresh.
Merchandising
Merchandising is often referred to as silent service. You are taking the customer on a journey and helping them buy the products that they want, and that you want them to buy.
When you are picking where to display your products, you need to consider a few factors. Firstly, work out what the margins of the product look like. How desirable or on-trend the item is. And, what are your current stock levels and buying commitments on the product.
Your ideal products will be high margin, high demand, and in plentiful supply. These should become your bread and butter. Even if the price of the item is relatively low, you are better off more of these products than of a more expensive line that doesn’t score so high on the margin, demand, and supply scores.
Think about putting these items in the front of your store, and ideally at your customer’s eye line. That way, anyone shopping in your store will see them immediately, and will hopefully take an interest.
Customer Service
One of the things that people expect from a brick-and-mortar store is a customer service experience. With online shopping accounting for such a vast percentage of all sales, you need to create a big point of difference that can’t be found easily online.
Be friendly, but ‘don’t be pushy. Treat your customers like friends, and really give them the time of day. If you can find a way of demonstrating your products, then you should do this. Showing how a product works is much better than explaining it, and retail theatre is an area that has proven to be very popular in generating sales.
Invest in training any team members so that they know their products inside and out. Set up challenges and incentives to keep people motivated. And employ people who have a natural sense of charisma who will approach customers.
Retail is a difficult business with lots of areas of competition. Many companies fail, and the marketplace is ever-shifting. If you can calculate all of your risks, and focus on products that will drive you guaranteed incomes, then you may well have a chance of success. If you plan on growing your brand, grow at a realistic rate, and make sure you iron out any problems before you grow. Allow yourself the opportunity to make mistakes early on, but learn from them quickly.
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