ArchiveFebruary 2017

We have begun previewing new-look POS software for our specialty retail marketplaces. This new look represents more than a year of work in design, development and testing. It offers our customers a fresh look, it keeps our software current with design standards relevant to retail in 2017.

This latest new look for our POS software continues the Tower Systems commitment to maintaining fresh and relevant software for our retail partners. It is what helps our software stay ahead, be loved by existing customers and winning the hearts of new customers.

The first personal previews of the new software started a week ago at the Sydney Gift Fair. They continue in a week’s time at the Melbourne Toy Fair. Then we will show the software off at our face to face user meetings around the country.

The new software is a result of terrific collaboration across multiple divisions of Tower Systems. It is a great team effort.

We develop, sell and support software for: gift shops, jewellers,  bike shops, toy shops, fishing/outdoors businesses, garden centres/nurseries, pet shops, produce stores, firearms businesses and newsagents.

1. Compare websites. Go deep. Look at ease of contact, support connections. Look for details of the real people being the business.
2. Compare software. On your desktop, next to each other.
3. Compare training. Sit in on a training session. Compare usefulness, professionalism.
4. Look at online tools. get a login and see what real users see.
5. Use it. In a shop,l behind the counter. See first hand the user experience.
6. Learn the total cost of ownership. Get this in writing, for the first three years. See the real cost of owning each of the software packages you are comparing.

There is a huge difference between software products. These six points could help you avoid POS software that is not right for your business.

How do you identify product that is not working? When do you quit a product that is not working? Why should you quit stock? How do you quit the stock? How long should quitting stock take? What if the item does not sell no matter what you do?

These are all questions we will answer here for you in the form of suggestions. What you ultimately do is 100% up to you. Your choices need to reflect your own situation and circumstances.

Identifying product that is not working.

Product is not working if it is not paying its way – paying for the floor space it takes and the time you spend on it. Check your sales, rank all your stock based on sales – look at the bottom performing stock. Your software should have a ranked Sales Report that lets you list all your stock ranked by unit or $$ sales. Use this to create your list of items to consider.

The other way to identify stock that’s not working for you is to check your back room or other storage facility. Stock that is not generating cash regularly has to be considered dead in our view.

When do you quit a product?

You quit, exit, products when they are not paying their way, when a season is done or when you want to exit that category for some other reason.

Let’s say your rent is $1,250 per square metre per year. If your gross profit averages, say, 50%, you will need to sell $2,500 worth of product to pay for a metre of space. However, this is not the complete consideration as you have labour, power and other costs to cover. The suggested rule of thumb is that your retail sales need to be at least three times that necessary to cover the cost of the space. In the scenario covered here, you should be earning at least $7,500 from a square metre of space. If stock is not delivering this, quitting it could be necessary.

Why quit stock?

To keep your shop fresh, to not be weighed down by dead stock to make your shop look more relevant, to stop hoarding.

How to quit stock.

Here is how we quit stock in retail businesses we operate. These businesses are in shopping centres where retail space is limited and expensive. We are necessarily aggressive.

1. Set a deadline. We’d suggest two weeks for quitting a product or range of products.
2. Choose your timing. The best time to quit stock quickly is on your busiest trading days. For many this will be the weekend. Consider structuring your quitting program to run from Thursday through Sunday.
3. Set your initial price. The discount must be compelling. We’d suggest 50% off. A smaller discount in this marketplace will not get noticed. Think about your discount words: in some areas, HALF PRICE works better than 50% OFF. Sometimes, 2 FOR 1 can be even more effective. A $$ price can work better – for example a dump bin with everything priced at $1. People then don’t have to work anything out.
4. Move the product to a high traffic location. Display it as a line you are quitting – in a dump bin or in open boxes. This must be in a location away from where the product is usually located. Do not make an attractive display. Consider placing the stock somewhere that people almost stumble over it.
5. Put up a sign that is either black on white or white on read. Nothing fancy. Even a hand written sign is good. Do not make a complex or attractive sign.
6. Adjust your price. If sales are not strong enough, go harder with your discount. From 50% off we suggest a drop to a $$ price point. It can be challenging selling something you would have sold for $20.00 at $1 but that $1 is better than getting nothing for the product at all.
7. Give it away. If the products are not selling, consider giving the stock away to a local charity. Getting it out of your shop for no compensation can be better than it taking space and giving off the wrong message about your business.
8. Keep track of time. If you decide to be out of the stock within two weeks, stick to that and make it happen with your pricing and placement decisions.
9. Use the bin. If you can’t sell the item and you can’t give it away, use the bin.
10. An alternative: If you have a large amount of stock to quit, consider hiring a local hall and running an off site sale. Talk to your suppliers about getting extra stock in for this. You could even plan to do this as an annual event. Consider, too, linking with a local charity to drive interest and create a fund raising opportunity for them.

Quitting stock takes strength and commitment. We urge you to do it to keep your business fresh. Product not selling gives shoppers a bad impression of your business.

Take a look at your shop floor and in your back room. Look at what you can get rid of right away to reduce the anchor of dead stock on your business.

Too many retail businesses have old stock gathering dust. One of the best ways to separate your business is to regularly quit stock that is not performing as it should.

This advice is an example of how Tower Systems helps small business retailers beyond POS software.

In years working with small and independent retail businesses, the team at Tower Systems has learnt plenty including the indicators of in which retail businesses theft is more likely to occur.

Our experience is that theft is more likely to occur in businesses where stock is not managed properly.

By not managed properly we mean where:

1. All items sold are not tracked at the point of sale.
2. Where new stock arriving in the business is not properly arrived through the software.
3. Where spot stock-takes are not undertaken regularly to maintain an accurate stock on hand account.
4. Where stock given away or thrown away is not written off.
5. Where stock returned to a supplier is not scanned out.

Our advice on reducing the cost of employee theft and customer theft is simple – follow our advice, manage your stock and without a doubt the cost of theft in your retail business will be lower than it would have been.

If you think the cost of managing stock is too great, think about the cost of $25,000, $50,000 or even $250,000 in theft. Yes, we see this all too often in retail businesses – where stock is not managed.

Managing your stock = less theft and less theft = increases product and increased profit = you get more when you sell your business.