Tower Systems helps small business retailers deal with cashflow challenges

Two weeks ago we published comprehensive advice for small business retailers on dealing with a cashflow challenge. It was not the first time we have provided business advice on cashflow management and it won’t be the last.

What makes us experts on cashflow management in small business retail?

This is a good question. We are retailers ourselves. We have 3,000+ retail businesses as customers. These points and our decades of service to small business retail position us to be able to help in this area.

Our advice was thoughtfully prepared, reviewed and edited, to ensure it spoke to the needs of local small business retailers, to help them in practical and genuinely useful ways.

We are grateful for the engagement of our small business retailer community, the follow-up questions, their engagement seeking help beyond our written advice.

Helping small business retailers beyond our POS software and with ready to use advice on managing a cashflow challenge is something we are proud of offering as part of our service at Tower Systems.

HERE IS OUR CASHFLOW ADVICE FOR YOUR CONSIDERATION. 

In it’s simplest form, cashflow management is about ensuring a business has the cash necessary to meet its obligations and, hopefully, build reserves for the owners.

Good cashflow management starts with the understanding that this is your business. You sign the lease. You sign up for any loans. You hire, train, motivate, manage and, maybe, fire the staff. You choose what you sell. You set your prices for most of what you sell. You control how the shop looks. You manage the promotion of the business outside the business. Yes, this is your business.

The cashflow of the business is a product of your choices.

It is critical for every business owner to own their business cashflow performance. Blaming others or external factors is a cop out. harsh as it is, that’s the truth.

MANAGING CASHFLOW.

This list is ordered by priority.

  1. Budget. Have one. Until you do, do nothing. This is priority #1. The budget should include an inventory spend allowance, so you know what you can spend. Plan the budget for the business to be profitable / viable without the need for agency to support it. Business budgeting should involve provision to grow savings / emergency funds without having to borrow / lifestyle choices / exit strategy if you cannot sell the business.
  2. Funding. Before you borrow from any source, get advice as to the appropriateness of this funding. Too often we see expensive, unsecured, loans taken out at ridiculous interest, to the significant cost and harm to the business.
  3. Shop lease. Only sign a lease you are happy with. Be prepared to walk away at the end of the current lease if the new one offered is not good. Run your business through the life of the lease as if you will not take up a new lease in the same location.
  4. Labour costs. Run a lean roster. $25.00 a day saved in labour costs is like $50 to $75 in retail sales. That is, $15,600 to $23,400 in revenue for a six day week over a year.
    1. Ensure every team member has a role description.
    2. Set business performance targets:daily revenue / revenue per labour hour or similar. It is critical everyone working in the business understands the goals and that they support them.
  5. Price for margin. Understand retail price psychology. For example, $13.50 is seen to be the same as $14.99. So, price at $14.99. By pricing to a higher price point you can discount back or fund a loyalty program that discounts for loyalty. Also, choose .99 over .90 or .95.
  6. Loyalty. Run a loyalty program that focusses on people shopping more often with you. Be consistent in your pitch. Do not waver over the offer. It rewards loyalty, not laziness. The focus on loyalty needs to be whole of business, whole of team in pitch and management.
  7. LayBy. Stop it. Instead, offer Oxipay, ZipPay or AfterPay.
  8. Basket depth. Maximise every touchpoint.
    1. Counter. Always have multiple offers at your counter, offers that are easily purchased on impulse, offers that deepen the basket and make a shopper visit more efficient for you.
    2. Top selling items. Look at what is on either side. Make sure the products are relevant and easily purchased with the popular item.
    3. Exit pitch. Make sure you have a compelling and regularly changed pitch to shoppers as they leave the business.
  9. Inventory.
    1. You control your buying. Not a rep of a supplier ordering on your behalf.
    2. A full shop is not necessarily a good shop. A smart shop is better. This is, one that people love to browse, love to shop. Often in retail less is more.
    3. Consider establishing a buying approval process where more than one person participates in buying decision. The goal is to slow impulse purchases. This could be someone outside the business.
    4. If you doubt your ability ton pay, don’t buy.
    5. Move, move and move. Every day there should be movement of products in the sore to keep it feeling fresh.
    6. If products don’t work, quit them as they are worthless if you put them in storage for later.
    7. Work with suppliers, exploring delayed terms or consignment opportunities.

DEALING WITH A CASHFLOW CRISIS.

A cashflow crisis is when you can’t pay your bills on time or a sustained period of dissatisfaction with the cash reserves in the business.Too often, small business retailers ignore a cashflow crisis, leaving action until it is too late.

Here is our advice on how to deal with a cashflow crisis.

  1. Own the problem. Fixing this is on you.
  2. Bring in outside help. This could be a friend, a financial counsellor. The best person will be someone who understands your type of business who can help you see what you don’t see and support you in tough decisions to be made.
  3. Understand the problem. Know if it is short term or long term. Be certain about the role you have played.
  4. If you run customer accounts, collect with urgency.
  5. Ask the landlord for immediate rent relief. The more transparent you are with them the better. Document your case. Be prepared to show your P&L in support of your request.
  6. Cut your roster to bare bones.
  7. If you have stock on sale or return and it is not selling, return for credit.
  8. Immediately start a sale.
    1. Give it a cool, non scary, name.
    2. Price items to sell, especially items for which you have already paid. Even selling below cost frees cash to the business.
    3. Get everything on the shop floor.
    4. Display to clear. i.e. not pretty displays for sale items.
  9. For inventory that you cannot sell, consider eBay.
  10. Consider selling assets. If you have equipment in the business that you no longer use, sell it.
  11. Talk to all your creditors, apologise, outline your plan, ask for help.
  12. When making progress payments on creditors, respect all with payments. NOTE: small regular payments could be key to you not facing debt collection action.
  13. Act. Every decision, every action you take must work to addressing the cashflow challenge. If you have created a plan act on it immediately. This is not a time to overthink things.
  14. Invest. If your cashflow challenge is because of a decline in traffic, not spending money chasing traffic will only make the problem worse. Spend carefully.
  15. Plan for the end point. This will be either coming out on top or closing the business.

The cashflow achieved by a business is a product of your decisions. Be thoughtful in each decision and single-minded in your focus on a better cashflow outcome.

Thanks for reading. We hope 2019 is awesome for you.

Mark Fletcher
Managing Director
Tower Systems International (Aust.) Pty Ltd
E | mark@towersystems.com.au.

Advice for small business retailers on theft

Most theft from independent retail businesses can be identified and reduced through a consistent application of simple management processes and smart use of specialist retail software. Tower Systems has been helping retailers cut theft for decades through issuing advice, responding to requests and by continuing to provide functions in our retail software that allow business owners to identify and track suspicious behaviour – by shoppers, managers and store employees. Over the years our expertise has been called on by police and prosecutors as well as individual retailers.

Follow this advice on how to use our specialist retail POS software to hamper opportunities for theft and bolster the certainty of detecting it before it’s too late:

  1. Employ stock control for high volume items. Enter new stock as it comes in, scan all sales and only reorder based on what the software says. Perform a stock take regularly each month. High volume item stock discrepancies are an indicator of theft.
  2. Scan everything you sell. Do not use department tracking only – your data needs to be granular to prevent employees taking advantage of loose stock on hand quantities. Not scanning individual stock items is unfortunately an invitation to dishonest employees.
  3. Use the software-based end of shift procedure and have a zero-tolerance policy on cash balance discrepancies. Reconcile banking to your computer software at end of shift. We have seen businesses failing to do this: one was being skimmed regularly of $200 a day.
  4. Do spot cash balancing. Unexpected checks can uncover surprises. One business owner needing to perform banking during the day uncovered a $350 discrepancy that lead to the discovery of systematic theft.
  5. Mix up your roster. Sometimes people work together to steal. One retailer found a family friend senior and their teenage daughter stealing consistently.
  6. Check your audit Log. Look at cancelled sales, deleted sales and items deleted from a sale. Leaving a cash drawer open from the previous sale, scanning items, taking the cash and cancelling the sale is the most common process used by employees to accrue cash they then take from you. Our software tracks cancelled sales and what was in them. This can be matched with video footage.
  7. Check GP by department. If GP is falling outside what you expect, always research further.
  8. Publish a theft policy. Put this on a noticeboard in the back room. Get staff to read it and sign up to it. At the bottom of this page is a sample theft policy.
  9. Keep the store counter area clean. A better organised counter reduces the opportunity for theft. Reducing nooks and crannies makes detection of any cash hoarding easier.
  10. Have a “no employee bags” at the counter policy. This makes it harder for dishonest employees to hide stolen cash.
  11. Beware employees who carry folded paper or small notepads. These can be used for them to keep track of how much cash is in the register that is theirs – i.e. not rung up in the software.
  12. Beware of calculators and mobile phones at the counter. Employees can use these devices to track how much cash could be stolen prior to balancing for the day – cash from sales not processed.
  13. Do not let employees sell to themselves. If an employee wants to purchase something ensure they purchase it from the customer’s side of the counter.
  14. Be professional in your management of the business. The more professional your approach they less likely your employees will steal as they will see the risk of being caught as high. Do not take cash handling lightly; if you respect your business procedures your staff are more likely to too. Never take cash from the till for your own personal use, i.e. to buy lunch.
  15. Advise all job applicants that you will require their permission for a police check. From the outset this indicates that you take your business seriously. In many situations applicants who have been asked for permission to do a police check advise they have found a job elsewhere.

These steps work. They are based on decades of helping small business retailers to reduce and manage employee theft.

Employee and customer theft costs a typical independent retail business between 3% and 5% of non-agency sales revenue each year. Management attention and smart use of retail software can cut this dramatically. It does not take much time – it is simply about smart procedures and professional processes.

Advice for small business retailers on how to quit dead stock

Beyond being a POS software company, Tower Systems often provides business management advice to small business retailers.

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.

Advice on avoiding the impact of a ransomware attach on your retail business

Ransomware / malware can come in many forms. Every computer connected to a network in any way is at risk.

There is no guaranteed protection but there are important steps to take. This advice sheet provides advice designed to reduce the risk to your business. Ransomware often comes in the form of a harness looking business email, seeking you to click on something that makes sense.

Often, if the recipient clicks on the attachment in the email, the ZIP file, on a PC running Windows they would have been locked out of the computer and subject to ransomware.

A ransomware attack is where money is demanded to unlock your computer. Often, the computer is not unlocked even after a payment is made.

More and more businesses including small business retailers are being affected by these malicious attacks, they are being locked out of their businesses.

You can reduce the opportunity of being hit by an attack by taking care with emails.

If you are not sure of the sender, ignore the email. Tell everyone who has access to your email. Lay out your ground rules and demand discipline.

Here is our best-practice advice to protect against Ransomware:

  1. Ensure you use professional, up to date, virus protection.
  2. Ensure you have a good firewall with strong settings.
  3. Do not click on emails or attachments unless you are sure of the sender.
    1. Be particularly wary of ZIP files in emails.
    2. The ATO will not email you.
    3. Your bank will not email you.
    4. Australia Post will not email you, not like the example I have posted.
  4. Ensure all passwords you use are strong.
  5. Consider using an email filtering facility.
  6. Do not allow remote access to your computer unless you are certain of the person accessing.
  7. Ensure you have strong passwords. A strong password should include: some CAPS, some numbers and at least one special character. Check your password at: https://howsecureismypassword.net
  8. Change your password regularly.
  9. Run an up to date operating system.
  10. Have rules on computer use: no games, no online gambling, no porn, no personal emails.
  11. Have an overarching rule: do not open any email or go to any website unless you are certain.
  12. Use a cloud backup service like the Tower backup service. This provides the fastest recovery.
  13. Have multiple backup devices for additional protection.
  14. Do not use automatic file replication programs / facilities such as Dropbox or Google Drive. If a file is encrypted with malware / ransomware it will upload to the account and infect other files.

Most ransomware attacks can be avoided by careful scrutiny of your emails and websites you visit.

Data security advice for small business retailers using POS software

2018 is not even half over and already it has seen considerable attacks on computers and on websites. Each attack reinforces the need for all businesses, including small businesses, to have appropriate security and backup measured in place to protect business data.

Appropriate backup means:

  1. Backup every day, without fail, without having too spend time for we know that time backups can take can make backups be ignored or forgotten.
  2. On-site backup.
  3. Plus, off-site backup.
  4. Easy access for recovery.
  5. Protection in a facility away from the business not only of all data but all software to facilitate swift recovery.
  6. Managed costs.
  7. Secure access to backed up data.
  8. maintaining backup services at the cutting edge.
  9. Appropriate security for backed up data.

Our advice is that you use a cloud backup service, like the Tower Backup service we offer. It works in the background, backing up without you having to do a backup. If your business is attacked, getting back to a clean and safe place is easy. Any reputable backup service should be able to offer similar to you.

Please do not put this off. Get protection for your business and your business data. You don’t want to be the person who does this after you have been attacked.

At the very least, backup every day, onto a USB stick for that day. While this is an old-school approach, it is better than nothing at all.

But let’s be clear, cloud backup is our recommendation. Our service provides you with a local backup and an offsite backup, in the cloud. This gives you two backups, excellent protection. We monitor the backups to ensure they are working. If we find an issue, we proactively call you. This is rare from a cloud backup service provider.

Here at Tower Systems we take data security seriously. We provide best-pracie advice. Our customers are welcome to use our service or another, our recommendation, however, is that they do something – to be protected.

Too often small business retailers think about data security after they have been affected. Hence this advice here and in our weekly emails and elsewhere in our touch points with customers.

Marketing tip: it’s not about you

Small business retailers tend to like marketing they can see. Like the ad in the local paper or the catalogue in letterboxes.

You seeing your own marketing is irrelevant. In fact, it is as irrelevant as many catalogues stuffed in letterboxes.

The best marketing today is about entertainment, accurate engagement measurement, faster delivery and more immediate in-store engagement.

Take the old-school catalogue . Artwork, printing and delivery will take three to six weeks and cost you or your marketing group around $1,500, maybe more.

In many locations, that $1,500 could have funded 60 Facebook campaigns reaching 2,000+ people, carefully targeted with accurate data on engagement.

While catalogues play a role, that role today is far less than two years ago.

A retailer told me they liked the catalogue because they could see it whereas they could not see a Facebook post. This is an old-school view.

Helping small business retailers leverage local in their POS software

In your Tower Systems POS software, you can easily to pitch that you are locally connected business. For example, you can serve, on receipts, local information relevant in your area:

  • A garden centre could provide advice on plants for local conditions.
  • A fishing business could provide advice on local fishing spots that are hot.
  • A pet store could include information about local dog parks and events.
  • A toy shop could list local collector and game clubs to foster community.

We can help you do this, we can help you show through the software how your business is better for the local community than any big business competitor.

BEING LOCAL BEYOND THE SOFTWARE.

Here are four ideas you could consider to show off a local connection. This collection of ideas is all about things you could do that are newsworthy for the local media:

  1. Tell the town’s story. Invite a school class to create a diorama telling some history of the down in your shop window.  This will be educational, topical, newsworthy and something that gets people connected with those involved to your shop to see the window.
  2. Famous and infamous people. Get your customers to nominate famous people form the area from back since when the area was first settled. Again, educational and newsworthy.
  3. Sports heroes from 2013. Invite all schools and clubs in your area to submit a photo and a brief description of their sporting winners from this year. The display could be your way of holding the winners up for another moment of glory.
  4. Where we come from. get a school class to create a map of the word for your window and get your shoppers to place a flag showing where they come from. Maybe the could have a place to note a story of how they got there.

While none of these ideas is about you selling product, each does better connect your shop with your local community and that is vital.

Here are other tips on boosting the local connection:

  1. Be knowledgeable about local activities, events, issues and places.
  2. Talk about local matters on your social media outlets. Help publish local news.
  3. Support local groups with knowledge, prizes and attention.
  4. Encourage local groups to use your business.
  5. Serve your community in practical ways such as volunteering.
  6. Help even the groups you cannot help financially – with an events noticeboard and supporting them on your Facebook page etc.
  7. Talk local across the counter.
  8. Be visible at local events and activities.
  9. Encourage your employees to be visible at local events and activities.

A theft policy is vital to helping any retail business cut the cost of employee theft

Here at Tower Systems we often help small business retailers detect and stop employee theft. One piece of advice that we see as vital to this mission is for a business to have a THEFT POLICY.

Here is a policy we share with our customers. Feel free to use it, modify it and share it.

THEFT POLICY

  1. Theft, any theft, is a crime against this business, its owners, employees and others who rely on us for their income.
  2. If you discover any evidence or have any suspicion of theft, please report it to the business owner or most senior manager possible immediately. Doing so could save a considerable cost to the business.
  3. We have a zero tolerance policy on theft. All claims will be reported to law enforcement authorities for their investigation.
  4. From time to time we have the business under surveillance in an effort to reduce theft. This may mean that you are photographed or recorded in some other way. By working here you accept this as a condition of employment.
  5. New employees may be asked to provide permission for a police check prior to commencement of employment. Undertaking the police check will be at our discretion.
  6. Cash is never to be left unattended outside the cash drawer or a safe within the business.
  7. Credit and banking card payments are not to be accepted unless the physical card is presented and all required processes are followed for processing these.
  8. Employees caught stealing with irrefutable evidence face immediate dismissal to the extent permitted by local labour laws.
  9. Employees are not permitted to remove inventory, including unsold, topped, magazines, unsold cards or damaged stock from the store without permission.
  10. Employees are not permitted to provide a refund to a customer without appropriate management permission.
  11. Employees are not permitted to complete sales to themselves, family members or friends.
  12. Every dollar stolen from the business by customers and or employees can cost us up to four dollars to recover. This is why vigilance on theft is mission critical for our retail store.

PLEASE SIGN AND DATE YOUR ACKNOWLEDGEMENT:

Yes, you can cut the cost of theft in any retail business. It starts with the right policies and processes.

Retail business owner advice: understand insolvent trading

A business owning three shops went broke months ago, owing close to two million dollars. The liquidators report was released recently, declaring that the business had been trading while insolvent for at least two years. This finding could have serious consequences for the directors.

ASIC defines insolvent trading:

An insolvent company is one that is unable to pay all its debts when they fall due for payment.

Yes, the definition is that simple. The director of the company to which I refer above was a blowhard, a gunna my mother would have called them. Gunna do this or that, with an attitude that they were an amazing business operator. Except, they were not. Many suppliers to the channel were left out of pocket along with banks and the ATO – and through the ATO, all Australians.

In my experience, often, the louder someone is about how great they are in business the worse they are.

ASIC provides advice on what to do if your company is insolvent:

If your company is insolvent, do not allow it to incur further debt. Unless it is possible to promptly restructure, refinance or obtain equity funding to recapitalise the company, generally, your options are to appoint a voluntary administrator or a liquidator. The three most common insolvency procedures are voluntary administration, liquidation and receivership.

ASIC has plenty to say on insolvent trading, including:

If dishonesty is found to be a factor in insolvent trading, a director may also be subject to criminal charges (which can lead to a fine of up to $220,000 or imprisonment for up to 5 years, or both). Being found guilty of the criminal offence of insolvent trading will also lead to a director’s disqualification.

ASIC has successfully prosecuted directors for allowing companies to incur debts when the company is insolvent, and has sought orders making directors personally liable for company debts. ASIC also runs a program to visit directors, where appropriate, to make them aware of their responsibilities to prevent insolvent trading.

If you think you may be insolvent, reach out to someone you trust for advice and to be by your side as you navigate the challenges.

The retailer in my story did not want help. They said there was no problem.

Advice for young people joining the full-time workforce in retail jobs

In our work with independent small business retailers we get to see man different retail businesses up close. We have seen plenty take on young employees, right out of school. Some do it well while others struggle. Through this time we have see good attributes in school leavers that we share here…

  1. Learn as much as you can.
  2. If you are not sure of something, ask. Don’t assume.
  3. Work out how to love your job, because if you don’t, working there will not be good for you or the business.
  4. Be as low maintenance as possible. Your employer is not an ATM you can tap every time you feel like sleeping in.
  5. How far you go in a business, and in your career, is up to you. You get out what you put it.
  6. Add value. If you do this a business will want to keep you and that gives you leverage in this job and your next.
  7. Every day, it is up to you.

If you are a business owner and hiring school leavers, step up to the responsibility seriously. You hire them, train them, manage them and determine their value to the business as as the value of the business to them. Oh, and being their friend is not an ideal step to good management.

Small business retail management tip: embrace the opportunity of hiring older employees

Older employees can being terrific value to a retail business that is keen bring change to the business. Young employees cost less and this is a common appeal among retail business owners.

An older employee could bring more value to the business, they could leverage a better return on labour investment for the business. Here are other benefits that can be available depending on the background, skill set and work interest of the older employee:

  1. Maturity. An older employee understand work.
  2. Appreciation. If they have been to of work for a while they are more likely to appreciate then job and could therefore invest more in it.
  3. Experience. An older employee could have experience in a field from which the business can benefit. I am not thin king here about retail experience. rather, they may have business management skills, special interests or experience that you can leverage as you change the business.
  4. Flexibility. With less focus on establishing themselves and a social life they cold be more available and this could help the roster.
  5. Communication. An older employee is more likely to be better with oral communication given they has less tech when they were younger. While this is a rash generalisation, I’d back it to be likely.

When you are looking to fill a vacancy or a new role in the business, consider older person for these and other reasons you can think of. The could bring to the business skills and interest the you can leverage more valuably than the skills and interest of a younger lower cost employee.

Of course, the value of any employee depends on your hiring, training, management and motivation of them.

The post of this post is to suggest that next time you hire you think about an older employee.

Note: The federal government jobactive restart program can help Australian businesses that hire older employees financially:

Restart is a financial incentive of up to $10,000 (GST inclusive) to encourage businesses to hire and retain mature age employees who are 50 years of age and over.

Older employees can bring new insights and energy to a business. The right hire could be just want the business needs to explore new traffic opportunities.

Retail management advice on maximising the Christmas traffic opportunity

Every Christmas, retail businesses see more shoppers in-store, buying gifts and items for seasonal celebration. However, the shops are usually too busy for the retailer team members to engage with traditional loyalty programs that require sign up.

This is where our amazing discount vouchers loyalty program options work a treat.

Without any sign-up overhead, the vouchers work all by themselves, bringing shoppers back or, better still, getting them to spend more than expected in that visit.

Stores that want to connect with shoppers and understand who they are can do so with our discount vouchers, because they are smart and can work with card based loyalty. In fact, shippers who sign up and go that extra step for the business can get an extra reward as a result, if you wish.

Simply by offering discount vouchers this Christmas you will get a boost with monomial cost and zero labour overhead. You can enjoy the traffic, love the traffic, and do well with a loyalty offer that works brilliantly to make the most of Christmas.

Tower Systems offers the tech and business practices to back the tech into real revenue growth for small business retailers.

Practical advice for new small business retailers

If you are new to owning or running a retail business it is likely that you have been too busy opening the business and settling in to have time to pay attention to basic advice about running the business.

Business consultants and others who advise business owners, too, often get caught up in big picture strategies and themes to deal with the basics.

In the interests of helping new retailers and retail shop mangers, here is a checklist of basic retail business advice, headlines mainly – not too much detail, just enough to remind you of key areas which need attention to build a stronger and more profitable retail business.

This checklist has been developed over the years of us supporting plenty of start-up small business retailers. The list is based on things we often see them neglect or forget.

We have grouped the advice into business areas.

Hiring, training and managing employees

  1. Create an employee manual with all employee terms and conditions.
  2. Hire the best employees available.
  3. Train your employees well. Do this by working with them, taking them into your confidence about the business, what it stands for and what you expect of them.
  4. Pay employees in a way which respects your faith in them.
  5. Share the rewards you make from the business.
  6. Remember, you are more responsible for employee performance than anyone since it is usually you who hire, train, manage and fire them.

Cash

  1. Cash is king in retail. An unprofitable business with a good cash flow can weather a storm.  A profitable business with poor cash flow can fail.
  2. Have a strong cash management policy.
  3. Bank regularly.
  4. Keep little cash on the premises.
  5. Never let one single employee control the cash. Have checks and balances.
  6. Keep expenses to an absolute minimum.
  7. Watch your product margins, make the most from each product you sell that you can without hurting sales.

Inventory

  1. Buy what sells.
  2. Use your software to determine replenishment stock.
  3. Never sell anything without tracking it.

Marketing

  1. Use all the free touchpoints: receipts, customer display and more in your software.
  2. Use social media, daily.

Operating costs

  1. Be frugal.
  2. Know dead stock as this is too often a big overhead.

Your time

  1. Automate as much as you can.
  2. Know how to get data to guide decisions.
  3. Delegate, with rules.

Too often new retailers and retail store managers look for advice to react to situations.  Consider the headline advice in this article early on and revisit it regularly to ensure that you have a strong and healthy business.

Retail marketing advice on how to increase items per transaction

Driving shopper efficiency is key for retailers. It is easier to get a shopper in the store to purchase more than to get a new shopper into the store from outside.

In looking at shopper basket efficiency for many different retail businesses we have developed an understanding of basic steps different small business retailers can take to drive shipper efficiency. Here is our advice.

ENGAGE.

Smile, make conversation, treasure your customers.  The more they enjoy shopping in your shop the more they will shop in your shop.  Smile.  Get good eye contact.  Say hello rather than can I help you.  The more personal the experience the more they will remember you.  This is your point of difference. Personal service is the single most valuable way to drive shopper visit efficiency.

WORK THE SHOP.

Standing behind the counter means you’ll serve people who come to you.  The more you are in the body of the shop and engaging with customers the more they will buy.  In busy times work the shop – engage, offer up sells.  Customer service increases revenue in every situation we have seen. Our advice is you locate a workstation on the shop floor.

DEMONSTRATE.

Show how products are used.

THE COUNTER AS A SALES TOOL.

Go to your shop counter and look at it from a customer perspective.  What’s the message?  Is it inviting?  Are you using the counter to drive sales?  Anyone can put product at their counter.  It takes a clever retailer to use the counter to entice customers to buy a product.  Use your counter wisely.

COUPONS.

It’s difficult to offer every customer an up sell.  Instead, use your receipts. Include a $$ off on next purchase.  Point it out. Keep it simple, have an expiry date on the coupon. This is an easy win that will bring back shoppers for sure.

TRAINING SALES EMPLOYEES.

Get your employees on side – explain your focus on growth.  If they don’t support you, replace them.  Respect your employees and ask for their ideas.  Use their ideas!  Train them.  Guide them in providing exceptional service.  They are your front line and need to be your most skilled team members.

TARGET, MEASURE, REASSESS.

Keep track of your success and failures.  Be realistic in your assessment.  Change what is not working and celebrate what is working – keeping your employees informed all the way through the process.

HOT SPOT TARGETS.

Focus on your top, say, 5 items.  Watch where people buying these items go in your shop.  Watch carefully.  Consider what you can do to get them elsewhere in your shop.  This is the key – getting people to shop outside their usual category, breaking their habits.

IN STORE SPRUIKER.

In your busiest time in the week bring in a spruiker for use INSIDE your shop.  Create some buzz and excitement to draw people away from their usual shopping areas.

CHANGE.

A key reason people will stop visiting your shop is that they know what it will be like.  A changing shop can be exciting.  Good changes will make people want to come in and check out new products and other changes you’ve made.

While much of this advice reads like common sense. Too often we see retailers who have missed the opportunity.

Helping retailers take better photos for their POS connected online stores

Photos are very important to retailers who sell online. The better the photos of a product the easier it is for an online shopper to purchase.

This is tough small business retailers as they often need to photograph products themselves if they want photos that look different from the stock photos provided by suppliers.

Photography for online sales is different to personal photography.

We get involved in this as it is in our POS software where small business retailers store photos and other content for each product they wish to sell online. Having the one repository for inventory information and images is important. It assists management and provided ease of change should the need arise.

To take better photos, retailers need to have the right tools:

  1. The right place for photography that is setup for easy access.
  2. Props for posing photos as the more you can show how a product might be used the better in some circumstances.
  3. A lightbox for taking shadowless photos. This should take different background colours and bet of the right size for the types of products you are likely to need to photograph.
  4. A good camera. A current model smart phone is usually okay given the quality of the cameras they offer today.
  5. Basic editing software for correcting any imperfections than cannot be easily fixed by taking another photo.
  6. Photo guidelines for all product photos taken by the business, so there is a consistent aesthetic for photos used by the business.

Once photos are taken and the actual ones to be used have been selected, these are loaded into the POS software for use there and for feeding to any ecommerce site used by the business.

If there are bulk photos to be uploaded to an ecommerce site, there are easy ways to do this without having to go through the POS software if that is a preference.

While none of this is related directly to help desk support using our POS software, we happily get involved, sharing the expertise of our team gained from our own retail businesses and the various ecommerce sites with which they connect.

How our POS software helps small business retailers reduce the cost of dead stock

Dead stock is dead money for small business retailers. Too often we see businesses where buying mistakes have been made and action has not been taken to correct the situation.

Using our POS software, small business retailers can make better buying decisions. They can buy based on evidence, hard data showing what works, hard data showing exactly what they need to satisfy demand, based on past performance data.

Small business retailers who buy by the numbers, who buy based on data, are less likely to have dead stock challenges in their businesses.

Here at Tower Systems we provide the software with tools to reduce the incidence of dead stock. We back the software with practical advice and help for our small business customers on how to actually use the tools.

It is one thing to sell someone a hammer and another thing entirely to show how to best use the hammer for safety and efficiency. That is what we do but here the hammer is our smart POS software.

Our goal is to stop the dead stock problem before it is a problem, before the business purchases stock. This can be done as we can show in many businesses with which we engage regularly today. We can show it in our own shops where we use our advised principles to reduce the incidence of dead stock and thereby save the businesses significant costs compared to others.

We work with retailers, retail business employees and suppliers on a range of tech and business solutions to ensure that dead stock is minimised, to provide commercially sound outcomes for small business retailers such that the cost of dead stock reduces in businesses with which we engage.

Our POS software is part of the solution. Training is another. Business management processes are another. Together we combine these and offer our partner small business retailers a solution on which they can rely to achieve better outcomes for themselves and their businesses.

The how, the real nuts and bolts of how are a discussion for a more private place as it is part of our IP, something that separates us in how we have the retailers who use our POS software and who rely on our support and business assistance services.

Helping small business retailers relax when feeling overwhelmed

Through its help for small business retailers, POS software company Tower Systems helps beyond the software, beyond what is usual for a POS software company.

The most recent help has been through practical advice on how to deal with feeling overwhelmed…

If you feel overwhelmed and can’t work out what to do, reach for this list and try one of the practical and safe ideas. They cost nothing.

The goal is to help you see small steps you can take to walk through whatever it is that makes you feel overwhelmed.

  1. Go for a 5k or longer walk outside, alone. Not a stroll, but a walk, at pace if possible. Unplugged, no phone, no music.
  2. Establish rituals for your day. How you start your day, how you end your day, lunchtime, bed time. For example, starting with breakfast, and a nice tea or coffee could be the calm start to the day you need.
  3. Have apps on your phone that are fun and you enjoy. Play one of these for a while to take your mind off things. It is amazing how our mind helps us resolve things when we turn away from those things.
  4. Learn meditation. From simple controlled breathing to yoga, meditation can be a perfect reset from a busy and overwhelming day.
  5. Play Scrabble through Facebook on your computer. You can play anytime with someone you have never met and will never speak to.
  6. Draw, even if you think you can’t. If you are not sure what to draw, draw why you feel overwhelmed.
  7. Write. Anything but you could try writing on the page about what it is that you think makes you feel overwhelmed.
  8. Talk. We are good listeners.
  9. Three-count breathing. Inhale for three counts. Hold for three counts. Exhale for three counts. Do this for, say, ten rounds. Then increase the count. The rhythmic nature of this and concentration can help you see ahead.
  10. Earth. Go to the beach, a park, your backyard and take your shoes and socks off and put your feet on the ground.
  11. Watch. Go to a playground and watch kids play. If there is a local sports game on near you, go watch that.
  12. Start a journal. Write in it every day.
  13. Be clear to yourself when the day is done. While it is tough in small business to turn off, have a threshold so that once you cross it, you have turned off and the time is yours.
  14. Find a quiet place, put on headphones connected to a music source and listen to your favorite album of all time, with the volume turned up and a do not disturb sign on the door.
  15. Get away to a safe place and write a note to your overwhelmed self. Give yourself honest advice you’d give your best friend if they came to you with the feelings you have.

If you are struggling beyond what these suggestions can help with, consider speaking with your GP about a mental health plan. This provides access to medical professionals who can help you more effectively deal with what it is that leads you to feel overwhelmed.

Tower Systems develops and supports small business POS software. Our advice and help often reaches beyond what is usual for a POS software company. www.towersystems.com.au

Advice for small business retailers on leveraging the teacher gift opportunity

This is another in our series of practice advice for small business retailers.

How to make the most of the teacher gift opportunity.

Gifts for teachers can be lucrative not only at the end of the year but also through the year by establishing your business as a destination for gifts for teachers. As with much in retail, it takes a commitment of time, space and capital.

While you can make money sourcing a teacher pack from a supplier, you will make more by taking a broader approach.

Our advice is that you offer a selection of gifts for teachers including the traditional plaques, mugs, apple-themed, frames and pens but this you expand the offer to include other suggested gifts such as scarves, Charlie Bears, soap, fudge, plush, jigsaw puzzles and other premium gifts.

Don’t be restricted by the traditional teacher gifts. Also, don’t be restricted by a price point. We suggest you show how two or more students could pool funds to buy a bigger gift such as a jigsaw puzzle. Show your customers how they can do this. For example: $19.99 or $10 each if two of you share giving this gift.  Maybe even consider a whole of class gift.

Promote the broader range of gifts with an appropriate sign such as: GIVE SOMETHING THAT WILL ACTUALLY BE USED.

Have your suggested gifts represented together in a location branded as gifts for teachers.

Be sure to include cards in your range – Thank You cards and blank cards. Consider packaging selected gifts and cards together to make buying easy.

Also consider a discount if customers purchase above a threshold for multiple teachers. For example, you could offer 10% off for purchases of $25.00 or more. Choose a spend hurdle that suits your area.

Marketing and promotion tips:

  1. Offer a $50 shopping voucher for one lucky teacher. To get an enter customers should purchase a card and gift from you.
  2. Include a flyer with all purchases announcing your teacher gift range.
  3. Leverage the local parents association to have them help you promote the offer. Consider having them hand out a coupon offering 5% off for purchases a 5% to them for each coupon redeemed.
  4. Setup a THANK YOU TEACHER WALL where anyone can write a note thanking their teacher – from any generation or year.
  5. Maybe run a Teacher of the Year competition where students vote. This could work well in a smaller location. However be careful as it could be seen as divisive if not done well.

Branding is everything in independent retail

Tower Systems understands the importance of branding in its business serving small business retailers with POS software. We also understand the importance in shops.

We enable beautiful branding opportunities for retailers using our POS software with professional branding of receipts and other customer touch points produced and managed through our software.

It is easy to do this.

Providing retailers with opportunities for concisely pitching branding helps locally run independent retail businesses to be consistent in their messaging.

We know from expert marketing research that multiple touch points for a brand is vital to brand awareness and trust. This is one of several key reasons why independent retailers need to embrace branding opportunities on everyday contact points, such as receipts, customer displays, shelf talkers, barcode labels, outdoor product tags and more.

By enabling beautiful customised customer touch points, Tower Systems helps small business retailers shine a light on their brand. We are proud to do this.

The photo is of a box of receipt rolls. We provide theses with fresh hardware installations by our team and sell them to our customers. Even at this level of our business, professional branding matters.

Advice for small business retailers on managing shopper theft

The importance of accurate stock on hand data is  critical, especially for retailers with online sales.

We recommend regular custom stock takes for the categories where you transact online.

A consequence of more regular stock takes is greater understanding of theft from the business. Rather than getting angry about discovering the extent of theft, which a lot of retailers do, act to manage theft. This is the best reaction you can have to theft of stock.

  1. Know the problem. Regular custom stock takes will help you achieve this.
  2. Own the problem. Based on evidence, take the problem on board as yours to fix.

Too often, retailers sit in the office or the back room. Problems like this are not fixed from the back room – they are fixed from the shop floor.

Too often work is done in the back room or away from customer sight that could be done on the shop floor and thereby reduce shopper theft. The more work you do on the shop floor the greater deterrent to those who would steal.

  1. Ensure all staff know about the problem. The more they understand the problem the better the opportunity for them to become engaged. Understanding must include knowing the cost to the business and the impact this has on the business and on them.
  2. Encourage staff to greet shoppers, explain this is a starting point to reducing theft.
  3. Spot (custom) stock take weekly or at least fortnightly. Record the number stolen from a category somewhere for staff to see. This sets a target for all.
  4. Move the product you are concerned about, try different locations.
  5. Place a portable work table near the often stolen products and move most there such as product pricing, invoice checking or other tasks that could be easily done on the shop floor.
  6. Ensure you have camera coverage of the location.
  7. Place the stock so there are no blind spots that make theft easy.
  8. Watch the location or stand from outside your business to see how shoppers interact with it.
  9. Bring in a retail security expert for their advice on your specific situation.
  10. Keep your staff informed about progress on resolving the problem.

The only way to reduce theft is to change things. If what you change does not work, change more. Keep changing until you find the answer.

Note: those often stealing the most are not those you suspect.

Inspiring retail businesses we have seen

In our weekly email to retailers using our POS software we including images of retail businesses we have recently seen that inspire us. Here is one of a suite of images we shared recently of a very different gallery / store we visited. It is inspiring as the other photos shared with our customers show.