When we talk about the value of a retail business we mean what the business is worth when it comes time to sell, which is dependent on the profitability of the business as reflected in the profit and loss statement.
Value is the key business measure here and while there can be non-monetary value perceived by the owners and other stakeholders, it is the value as seen by others, as through P&L results that is the common measure.
Using POS software from Tower Systems, retailers can drive value. Here are 7 ways they can do that:
- Dead stock. In the average indie retail business, dead stock is equal to around 3% of turnover and often around 12% of total current inventory investment. Using our software, it is easy to identify dead stock. That’s the first step to converting it to cash.
- Stop running out of stock. Selling out of items that will sell costs the business money. In a small retail business we looked at recently, sell-outs cost more than $3,000 in a year, or $1,500 in gross profit, all because of poor re-ordering management. Your Insights Dashboard has this information.
- Bloated roster. Some prefer to spend money on people, so they have time to themselves for relaxing, golf or to sit in the back office, where no customer purchases from. We often see a bloat cost equal to around 10% of the roster.
- Wrong trading hours. Some stay open too long while others are not open long enough. Either way has a cost to the business.
- Being blind to theft. Theft in local indie retail costs on average 3% – 5% of turnover. Our software can help you see it, track it, and mitigate against it.
- The wrong product mix. GP% is a key measure of retail business performance. Often, we see retailers chasing transaction volume and not watching and chasing GP%. Growth in business GP% is often more valuable than transaction growth.
- Reordering. Ordering based on data reduces mistakes. It’s better, too, than letting a supplier order for you. The software can help you with reordering, so there are fewer mistakes, fewer sell-outs, less dead stock.
This list is incomplete as our POS software can help cultivate value in plenty of other ways. We created this list to provide our customers with a starting point, some low hanging fruit.
We shared the advice with our customers via our regular customer email and our regular print newsletter. This is another example of the proactive approach we take to guiding our customers to achieve more from their use of our POS software.
While, for sure, our help desk answers support questions and helps with technical queries, we often go beyond with business advice that crosses the intersection of the technical; aspects of the software and the use within a retail business of the software to better serve the business and its owners.
7 ways retailers can use POS software from Tower Systems to help improve the value of their business is all about showing our POS software user community ways they software they already have can be used to help cultivate business value.