Empower Your Business

Accounting is Just the Beginning

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Retailing -It’s Not Dead Yet!

I was reading a newsletter this morning about the massive growth in on-line retailing. Some traditional retailers have seen their sales decline by 40% whilst on-line sales are booming with an increase of 29% in 2011 just for traditional retailers with an on-line option. Currently New Zealanders spend $2.68 billion shopping online annually and this figure will increase to $4.22 billion by 2015 (according to AMP).

This together with the news of the demise of yet another local retailer I use (or used to!) made me think, once again, about the future of traditional retailing. The problem, in many cases, is the attitude shown by many retailers, who just sit back waiting for something to happen and blaming everything and everyone for what has happened. This is not just my view – this was a comment made by a retailer client to me today. So what should retailers be doing?

  • Find a niche. Some traditional retailers are still really successful and often it’s because they have found themselves a niche, perhaps the over-50’s, these looking for quality, or fashion conscious ladies. Study independent retailers who are successful and copy them.

  • Get some decent systems in place. Only a half of the retailers in my local town have a computer in their shop. Many have absolutely no idea whether they are making or losing money or what stock they are carrying, let alone what it cost them. If someone asks you for a deal, wouldn’t it be so much easier if you knew exactly what your margin on that item was so you could drop the price or decide not to, or perhaps meet them halfway but still make a profit?

  • Get out and do some marketing. Build your database, send out newsletters, get on Facebook, hand out some referral vouchers or hold some closed door sales – it’s all very easy and if you’re quiet you’ll have plenty of time on your hands to do this.

  • Concentrate on the overall customer experience. Many retailers and especially their staff are shockingly poor at showing interest, customer service, adding value, and after-sales care.

  • Very importantly, focus and capitalise on the advantages that traditional retailers have over on-line retailing e.g. you can take the old model and all that annoying packaging away, give advice on the best options, visit homes and businesses to see what suits or up-sell.

  • Teach your staff how to sell or fire them they’re no good. Use scripts, role play, develop some tricks – it can be done!

  • Join them! Get yourself an on-line shopping cart. These don’t have to be super expensive, but choose you web-developer with care.

  • Go on the attack. It’s a bit like what’s happening with pubs (such a shame!), when less people go, they have less money to spend, so it looks shabby so even less people go and there’s an ongoing cycle of decline! Keep up with the times, refurbish your premises and keep your stock levels up. A tired-looking shop with no stock is not going to attract anyone.

  • Face facts. If you’re in a marginal location, faced by really stiff competition or in sector which is just history and have no resources left to move or reinvent yourself, perhaps it really is time to throw in the towel.

There will always be a demand for traditional retailers, at least in our lifetimes, so come on retailers, modernise and take affirmative action. There are so many things you’re still better off buying off-line! Your future is in your hands and your hands alone.

If you need help with your business why not join the A+BAC community on Facebook. This is the place where you can get all your business questions answered free, in real time and in a practical way. You can also add your own experience to the pool and start helping fellow business captains.

You can also contact Nick by email.