Having access to the cash you need when you need it is critical in business.
Here are some obvious but too often ignored hacks to help improve the cashflow position of a business.
- Quit dead stock. In every retail business we work with we find that at least 20% of stock in the business is dead. That’s cash, space and time being wasted. Identify it. Quit it.
- Buy better. Buy stock based on evidence from your POS software. This will result in less dead stock and less out of stock situations – a third of all retail businesses we’ve looked at lost revenue by not having in stock products when shoppers wanted.
- Compare suppliers. If you have multiple suppliers for a product category. Compare their performance and act on the evidence. POS software can make this easy. We did this in two of our own shops last year and added $25,000+ in high gross profit revenue to each.
- Make shopping easier. Do this and people will spend more: make navigating the shop easier, use signs sparingly – ensure every sign is helpful, offer bundles of products to make occasion purchasing easier, include how to sheets with products as appropriate.
- Roster to revenue. Labour is usually the second or third highest business cost. Have your best people selling. Make sure every costed hour adds value to the business.
- Pass on actual EFTPOS costs. Use your POS software to auto-calculate the actual cost of a card presented and surcharge this per transaction. Shoppers have been educated now to accept this.
- Know the cost of theft. Between 2% and 5% of turnover is the cost of theft (shopper and employee) in indie retail in Australia and New Zealand. Use your POS software to know your stats, and act to reduce this.
- Attract more shoppers. Yes, this sounds easier said than done. But … a stunning and unexpected front window or street display will catch attention, fun social media posts will catch attention, a relationship with a community group will catch attention, being online will catch attention.
- Get current shoppers buying more. A smart loyalty program with the right settings for your business should achieve this for you. Too often local retailers run points-based loyalty that does not differentiate their business.
This list is a start. There is no one thing you can do to improve cashflow. It takes discipline – we learnt that ourselves for our own shops.
We make POS software used by thousands of local retailers. We use our own software in our own physical shops and our consumer-facing websites.
We’re not your average POS software company. To discover more: email firstname.lastname@example.org or call 1300 662 957.
We make software for bike shops, garden centres, jewellers, gift shops, pet shops, landscape supply businesses, repairs businesses, bookshops,
fishing and outdoors shops, newsagents, produce / farm supply businesses, fabric shops, sewing shops, music shops, computer shops, firearms dealers, charity & op. shops, community enterprises and more.