Website advice for small business retailers who want to sell online
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Free stocktake training for POS software customers
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Tower Systems started offering its 2022 free stocktake training for retailers using its POS software several weeks ago.
The training available is in video as well as written form. It covers a full stocktake as well as partial stocktake and theft mitigation stocktakes.
By providing baseline video based training, the company offers a consistent starting pout to all retailers, covering everything everyone needs to know.
Every Tower Systems POS software customer has access to the stocktake training, without cost, without any financial commitment requirement. By making access free and easy, the company is ensuring that all customers have the same opportunity to get accurate stock on hand data for their business.
We shot the baseline stocktake training video a few weeks. This shows best practice stocktake advice relevant to 2022. It leverages pas advice and presents it fresh, with content relevant to this year.
Here is some of the advice we published to ur POS software customers previously re stocktake. It reflects more practical advice advice, operational advice.
Take the technology to the stock and not your stock to your technology.
For the process to be as easy as possible you will need a wireless network – vital for OH&S reasons.
The best way to do a stocktake in your business is by using a laptop (or laptops) or tablet computer with a scanner attached. This enables you to do the stocktake live with no impact on sales and absolute integrity of your stock on hand data.
While using a laptop (or laptops) or tablet computer may seem cumbersome, it is our best practice advice for speed, data integrity and the ability to address data issues you may encounter on the shop floor. It enables you to do management work to ensure completely accurate data.
The alternative is to use a PDE. The challenges with this are the many different PDEs and it is challenging to be expert in all plus the PDE counts at that time and you load the data at a later time – meaning a gap in time in which sales could have been done. While PDE software is available for live to data updates, we have seen this be problematic and so we do not use it.
Given the advances in technology, our best practice recommendation is either a laptop of tablet computer as either offers a better solution than a PDE.
We suggest you setup a Laptop or tablet and use Team Viewer or the like to connect in and count this way. This approach means you do not need to purchase an additional software licence for the laptop. Team Viewer is easy to setup. If you do need our help on this there would be a support cost.
For the physical stocktake, we suggest you approach the business aisle by aisle, counting and rearranging stock as you go.
Local retail business advice: sell online but not as you sell in your physical shop
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We were recently asked to write an article for a magazine for Aussie newsagents about selling online. The advice we included in that article for local retail newsagents applies equally to any local retailer. We share the article we wrote here to offer advice for local small business retailers contemplating selling online:
Sell online, but not as your shop today.
When people shop online they shop for an outcome. They search for the product or purpose. They do not search for a masthead.
This is a valuable insight for any newsagent considering a website for their business for putting your newsagency online with what you sell today could be an expensive mistake.
Tower Systems has built many websites for newsagents and most are not sites that represent the newsagency shop online. Rather, they present as a different business, focussed on a niche category and leveraging the shop infrastructure to help the business expand.
This is the smart move for any retailer selling online – using it as a start-up opportunity that makes use of space and labour in the shop but not relying on products in the shop.
In one case, a newsagency business has grown online to where it is more financially valuable than the shop within which it was incubated.
In another case a newsagent tested a category online, hit gold and expanded the shop to offer this, hitting more gold.
Engaging with Tower Systems to create a POS software connected website provides newsagents with access to comprehensive online sales data through deep Google results research. This can help newsagents discover opportunities not previously on their radar.
By tapping into current keyword search data using respected commercial tools, Tower Systems is able to show newsagents pathway opportunities into new product areas online. These can be opportunities tapped into with a minimal capital investment, an opportunity for expansion with a modest budget.
While I understand the push to take the shop online, in my years of experience owning newsagencies and running successful and failed websites connected to the shops, my advice is to leverage the website opportunity as if it is a start-up, playing in a space you have not played in before, with the goal of it leading you on a path of discovery.
Tower Systems is better placed to support this greenfield approach than a local web developer … we have found local web developers more likely to replicate online what you have in. the shop and that, my friends, is unlikely to attract for you the volume of new shoppers you might hope for.
Being online is critical for every business. Doing it right, in an approach appropriate for 2022 and beyond is key.
Take your time. Do your research. Make sure that what you choose can be maintained by you. And, only sign for a fixed price website build.
Advice on how to deal with theft in local retail businesses
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Theft is a scourge in retail businesses. beyond the financial cost is a considerable motional cost to those in the business from employees to owners.
We shot a brief video a few months ago in which we discussed theft in retail, leveraging our years of experience helping local retailers to reduce theft.
There are things retailers can do to protect against theft as well as to deal with it when it is discovered. This video is a peek inside what Tower Systems offers its local specialty retail POS software customers.
As retailers ourselves we draw on lived experience in providing this advice. The more we all share on this challenging topic the better for all retailers.
Here is an example of some pf the advice we have provided to retailers.
Too many retailers read advice about theft and ignore it. Indeed, the most common trigger for small business retailers to work on reducing employee theft is the discovery of such theft. Here are simple steps you can take to detect and manage employee theft:
- Track your stock. Receive all stock into your business through your computer system so you know exactly what sock you have.
- Scan everything you sell. Do not use department keys as this makes it easier for employees to steal since they know there is no trackback to stock on hand. Using department keys is an invitation to steal.
- Track every sale by employees. Give your employees a card with a unique barcode or have them enter a code – to track every sale they make back to them. Change the code every six months or so.
- Do your end of shift through your software and have a zero-tolerance policy on being over or under. Reconcile banking to your computer software end of shift. One business where this was not done was being skimmed regularly for $200 a day.
- Do spot cash balancing. Unexpected checks can uncover surprises. One retailer needing to do a banking during the day uncovered a $350 discrepancy that lead to discovery of systematic theft.
- Change your roster. Sometimes people work together to steal. One retailer found a family friend senior and their teenage daughter stealing consistently.
- 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. Good software tracks cancelled sales and what was in them. This can be matched with video footage.
- Check Gross Profit by department. If GP is falling outside what you expect, research it further.
- Setup a theft policy. Put this on a noticeboard in the back room. Get staff to read it and sign up to it. See the last page of this advice.
- Keep the counter clean. An organised counter reduces the opportunity for theft. It makes detection easier.
- Have a no employee bags at the counter policy. This makes it harder for them to hide your cash.
- 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.
- Beware of calculators with memories at the counter. One retail business employee used the memory function to track how much cash had to be stolen prior to balancing for the day – cash from sales not rung up.
- Do not let employees sell to themselves. If they want to purchase something make them purchase it from the other side of the counter.
- 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.
- 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.
- Do not take cash out for your own use in front of employees. If they see you take cash for a coffee or lunch some will see this as an invitation.
These steps work – based on decades of helping small business retailers to reduce and manage employee theft.
UPDATE: 5 things every retailer should know about their retail business but are usually not told by POS software
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3 weeks ago we published this video: 5 things every retailer should know about their retail business but are usually not told by POS software. Across several platforms it’s had 1,000 views, for which we are grateful.
When our CEO made the video, it was spur of the moment, based on a comment made in a conversation at the Sydney gift fair in April. While the video was spur of the moment and not scripted, it drew on years of experience, years of service of local small business retailers.
We appreciate the feedback we have received, the appreciation.
To us, the video represents something different about Tower Systems. It presents that we want you to cultivate and harvest value from your business through the use of our POS software.
This is the difference of value.
Long after you start using our software, appreciating genuine value from its use.
Thank you for watching. Wr hope you found the video useful.
4 things any local retailer can do to immediately improve cash flow
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Talk to any retailer and they will tell you cash flow is tight.
In this short video we leverage our experience helping many different local retailers on ways to improve cash flow.
It’s free advice from our POS software company, Tower Systems, part of a broader kit of free advice all Tower Systems customers can access to broaden the appeal of their businesses.
8 ways any local small retail business can improve cash flow and thrive
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Cash flow is on the minds of many local small business retailers right now.
But before we get into providing advice, let’s agree a definition. Cash flow is the flow of money in and out of your business, real cash, in your account, or in your safe. Cash in comes from sales or products and assets and other payments from customers and suppliers. Cash flowing out is for bills, inventory purchases, labour and rent, typically.
Any business wants to be in a positive cash flow situation, because negative cash flow needs more capital inflow to support, and that can come at a cost.
Now, to our advice.
8 ways any local small retail business can improve cash flow and thrive.
Are you ready?! This advice is based on our years of service of thousands of local small business retailers across a range of specialty retail channels. It also comes from many years of us owning and running our own local retail shops.
- Free dead stock. In our experiences this releases the most cash flow value, but it is the option most often rejected for often silly reasons. dead stock is stock that is not selling, not moving. It is often stock you have long since paid for. This means that any money you get for it is positive cash flow right now. The loss from paying for the stock has already been realised – many retailers forget that. So, idea tidy what’s not selling, and quit it creatively, with urgency. Cheer every dollar this brings.
- Trim where you can without impacting sales. The most beneficial move here is typically a cut in the roster, a cut in labour cost. Save a few dollars with no sales revenue impact and you are ahead cash flow wise.
- Get shoppers to spend more in a visit. Smart loyalty software will do this. Points loyalty systems are unlikely to do this. There are better loyalty options designed to help encourage shoppers to spend more in a visit. Our POS software helps nurture this.
- Charge more. Yes, we understand this can be scary. The thing is, if you do this carefully, thoughtfully, and offer a good loyalty incentive and bundle items together, a modest price rise is less likely to be noticed and more likely to have a positive impact on cash flow. Think about it. Plan for it. Take small steps. A 1% rise across your top 200 inventory items could be the small step that delivers the cash flow boost you need.
- Find more customers. The more new customers you have shopping with you the more you will sell, obviously. It can feel easier said than done to attract new customers. In our experience, most local retail businesses do not have a new customer attraction plan. Do you? It does not need to be complex. Even a simple social media pitch honouring a new product, reflecting your gratefulness to have it could be enough. One the post is up, pay for a boost in your area. An $8 spend over 4 days is all you may need to get in front of a few hundred prospective new customers … and that gets you on the path, that could be your new customer attraction plan.
- Trim overheads. Look through your business overheads and look for an opportunity to trim.
- Look at your sales counter. With most purchases being completed at the sales counter, look at it from the perspective of your shoppers and see what you could do to encourage them to add items at the last minute. The counter is a valuable place of influence. Use it. Make sure it is driving deeper purchase baskets, and adding to cash flow.
- Spend less on inventory. Look for suppliers with good inventory holdings that allow you to use them, rather than your shop floor or store room, to hold stock you may not sell right away.
This list is a start, a small start, a modest start, it offers practical advice you can follow, practical steps you can take in any local small business retail setting to improve cash flow.
Using the Tower Systems POS software you can engage with any of these and other ideas for improving cash flow in your retail business.
Beyond POS software, Tower Systems will help, because we want local retailers to thrive. You are our customers, our focus.
Footnote. Many retail business owners get in their head about cash flow, they look for big moves and end up spinning their wheels, going nowhere. In reality, the most beneficial cash flow improvement moves you can make are those that are simple, easy ti implement, immediate to implement and, most important, that work with other moves … for it is the compounding benefit of a series of small steps that can deliver excellent cash flow improvement benefits to local small business retail.
Tower Systems helps local small business retailers deal with rising interest rates
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Rising interest rates are on the mind of everyone in Australia right now it seems. News stories appear daily about the impact of rising interest rates … for homeowners, for businesses. Everywhere we turn there is a ‘take’ on rising interests rates.
In local small business retail we can see the impact of higher interest rates through several lenses: consumer confidence, actual sales and business costs – for businesses with loan funds in place to support the business.
Our Tower Systems POS software company helps local small business retailers deal with rising interest rates in a range of ways …
We help retailers track trends on their shops. This is vital because while there is news out there and plenty of speculation, a retailer can only rely on what they bank through their register and our POS software is that register. we can help them access facts as they pertain to their business as opposed to feelings based on news and other stories. Facts matter. One retailer told us last week that rising interests rates were impacting their business through less sales. While their transaction count was down, revenue was up in higher margin areas meaning the business was banking more profit. facts matter.
We help retailers cap costs. The rental / subscription cost of our POS software has not changes since mid 2019. We have no plans to change it. Our customers know this. We are iota adding to their costs. We also help them require the cost of labour in their businesses and this can save money and free cash for other, more productive, uses in the business.
We help retailers free up cash in their businesses. And, this can help reduce their reliance on loan funds, which means a lower impact of rising interest rates. now, how do we help retailers free up cash. We do this in a range of ways, through smart tools in our POS software. We helped one business release more than $20,000 of hitherto dead money. The released funds helped them reduce their overdraft and that reduced the amount of interest the business was paying. It all comes back to using business data.
Rising interest rates are a thing. Rather than getting caught in the quicksand over them, our focus is on helping local small business retailers develop and walk through a plan for dealing with rising interest rates so that their businesses are not as impacted as they might otherwise have been.
The news out there on rising interest rates can be scary, and distracting. Our advice is to focus on that over which you have control, to understand, seek out a pathway through and to step thoughtfully along that path.
Tower Systems helps local small business retailers deal with rising freight costs
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The cost of freight is increasing. Freight into Australia costs more. Freight around Australia costs more. Freight locally costs more.
Small business retailers can feel challenged as to how to deal with this, now to manage the cost of freight, how to protect their business against the cost of freight.
Tower Systems helps local small business retailers deal with the cost of freight by providing in the software the ability to easily spread the freight cost of a package containing a range of goods across the sale provide of all the goods received. This allows the business to pass on the cost, spread the cost, reflect the cost fo freight across all items brought into the business.
Too many small business retailers stress about then high cost fo freight and what to do about it. the thing is, freight is. cost everyone has. There is no such thing as free freight.
Trucks cost money. Truck drivers cost money. Warehouses cost money. Fork lift drivers cost money.
Every item in every shop in town has a freight cost associated with getting it on the shelf. There is no point complaining. It is a real cost, a universal cost, one that is best managed efficiently, and spread across the sale price of every inventory item that you have in the shop.
Use your POS software to do this. Tower Systems helps local small business retailers deal with the cost of freight. We do this through software facilities in the POS software as well and through advice on how to use the POS software and business management advice. This is where we leverage our experience as retailers to provide practical advice ion the test way to deal with the rising cost of freight in small business retail.
Once you discover that it is easy when receiving new inventory into your business to spread the cost of freight, you can systemise the process, structure it, make it part of your operational processes. This takes the emotion out of the situation. It stops you having tom micro manage it. You benefit and the business benefits.
Freight is a cost all businesses confront. There are myriad ways to deal with it, manage it and leverage it sol that it is not as problematic for the business as it may seem.
Tower Systems is a full service POS software company focussed on local specialty retailers in selected retail channels.
5 benefits POS software companies neglect in their sales pitch
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Good POS software offer these 5 benefits. Tower Systems does.
- What’s not selling = cut dead stock waste.
- What you’re missing out on = stop selling out.
- What’s sells with what = selling more.
- Theft under your nose = save thousands.
- Know when you’re busy and quiet = reduce labour costs.
Of course, thanks to the Tower Systems POS software, there are many more benefits than these. Now, here’s a new video from us about these 5 benefits from the Tower Systems POS software.
Retail advice: if you are concerned about rising EFTPOS merchant t fees, here are some steps you can take to help
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It’s an easy complaint to make – my merchant fees are going up, it’s not fair, time for me to consider another supplier.
Okay, yeah, that’s an easy take. It’s a cheap shot by us to call it out. But, let’s explain and explore it with you.
Our advice is to look at your data first.
We have thoroughly looked at hundreds of thousands of baskets from many retail businesses.
The most common reason merchant fees are increasing is because of more sales transacted using EFTPOS.
While sometimes the actual fee basis, flat fee per Tx or percentage, increases, this is rare.
Yes, the most common reason a retailer paid more in merchant fees last month than the month before is because more transactions were paid for on a card.
So, the EFTPOS provider is not the cause of the issue.
Retailers is some marketing groups have access to preferential rates that see them paying the lowest fees in the country.
But, that addresses only the base cost.
To address the growing cost to the business, of people using a card to pay, you need to be an engaged retailer. Here are some ideas:
- Promote cash payment – if you want the costs associated with cash of course.
- Be clear as to the cost of using a card. You could apply a surcharge, which I think is a ridiculous idea though.
- Price knowing that cards will be used. Build the cost into your pricing model. Keep the bump under 2% and it is less likely to be noticed.
- Lower a cost elsewhere to cover the cost. Look at your labour cost, for example. Shaving a hour of employee rostered time can save you around $30.00, that’s equal to purchases of $3750.00 on a card – depending on the type of card used.
- Increase sales. While you should be single-mindedly focussed on this anyway, increasing sales helps you address the EFTPOS cost and more in the business.
It’s easy to kick a bank over EFTPOS fees. But … before you do that, look at your own behaviour. Here are common points in retail businesses that retailers overlook when they kick a supplier:
- Dead stock. It’s easy to identity but often not. A problem not seen is not a problem to some. In my experience on conducting an audit of stock performance, usually, 20% of stock on the shop floor over which the retailer has full control underperforms and should not be there.
- 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.
- 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 retail, like a local newsagency business, costs on average between 3% and 5% of turnover. Not watching for it, tracking it and mitigating against it has a cost to the business.
- The wrong product mix. GP% is a key measure of retail business performance. Increasing yours beyond what is traditional for your channel provides you with a buffer. For example, transaction count / sales can decline and you can be okay. Measure GP%. Set a goal. Chase it. The air is cleaner in above average.
- Ignorance. It’s not bliss. It’s not! There are insights in your software that can guide better decisions, faster decisions, more financially rewarding decisions. Yet, too many in retail don’t want to know. That failure costs them plenty.
The 6 items on the above list are all on the retailer to address.
We get that it’s easy to complain about high EFTPOS fees. If you are contemplating that, please take a moment to look back inside your business, look at the reason why and see if there are decisions you could make that are more valuable than complaining about EFTPOS fees or changing supplier. Our team here at Tower Systems would be happy to help.
Rising EFTPOS fees are likely not a problem since the y reflect rising sales, unless your provider is hiking your fees, which is rare.
POS software data help retailers see they are not their customers
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You are not your customer.
This is one of the best pieces of advice you can give a retailer, for too often, retailers stock their shops with what they like more than what customers may like. They tend this that shoppers will like what they like. Evidence tells us that shoppers like what they like more so than what the retailer likes. This is especially true in local high street retail.
Talking with a retailer about our POS software recently, they mentioned their success with a product category they had rejected for several years. That category is now delivering to their shop close to $50,000 a year in good margin revenue to the business. Better still, it is attracting a category of shopper not common to their business.
They mentioned it because they heard us say to another retailer you are not your customer. They made the point that it took them a while to realise the trust of this.
None of us in retail are our customers yet too often local small business retailers stock their shops with what they like, missing opportunities to give more local shoppers what they like.
Ranging new products is speculative, a risk. But, trying to attract new customers requires this type of risk taking, done carefully. This is where POS software data can play a vital role in understanding the opportunity.
The key is the POS data analysis of the performance of what you have taken on, to measure whether it stays or goes. If it is working, the opportunity could be to expand into allied niche areas, to grow the opportunity further.
Accepting that you don’t know what you don’t know can free you to trial products you have rejected in the past and, through that, uncover valuable opportunities for your business.
Our advice is to always have a modest inventory and space investment on the shop floor of new products that you would not usually carry. Let them show you if they work or not. More important is advice to rely on your POS software data, for this will provide better guidance as to what works best in a shop, it is the evidence.
You are not your customer. Test, play, experiment to find out what your customers love and through this experience more love from in and for your shop.
How small business retailers can cut shopper theft with POS software from Tower Systems
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Theft is local retail businesses is expensive for retailers. But, this theft by shoppers if often not considered or acted-on by retailers until they understand the real cost of this theft by shoppers.
From what we see, theft by shoppers can cost retailers between 3% and 7% of sales revenue in value. We have seen this across a range of retail business types and in a range of retail situations.
This year, in 2021, we have seen some evidence of co-ordinated theft, groups working together to shop for products they can flip online and air local markets.
The key to reducing theft by shoppers is through a managed process, adopted by the business leaders and implemented by everyone working in the business.
Here are seven steps we suggest to cut the cost of shopper theft in your retail business. While there are other steps you could take, these seven are most valuable from our years of working with retailers.
- Use your POS software. Spot stock take. Understand the cost of theft. This is critical for once you understand the scope of theft by shoppers in your business you are more likely to act. In our experience the evidence is that items being stolen are not those you think are being stolen. Data is key here. hence our advice to use your POS software.
- Look at people as they enter. Eye contact is key. Ideally, say hello to them. The more they think you have seen them the better.
- Have a screen near the entrance / exit so people can see that you filming them with your security cameras. The more people think they will be caught they less likely they are to steal.
- Work on the shop floor. That is unpack and price new stock on the shop floor, and not in the back room. This puts you or your employees among shoppers and heightens the chance of detection of theft.
- Walk the floor. Every so often, do a circuit. Be present. Talk to people.
- During peak shopping periods, station someone outside the business looking. Ensure they are trained on appropriate action should they see misbehavior.
- Bring in a security guard on a casual basis during your most busy periods. A good starting point here is to hire someone to look at the business under-cover, to see what they see, that you are not seeing.
The more likely people are to be caught the less likely you are to experience shopper theft.
Tower Systems has many years of experience in helping independent small business retailers mitigate em ploy theft and shopper theft. We leverage this experience for our customers through excellent POS software, free training, group training workshops, data analysis and expert witness support for authorities in specific cases.
Small business retail advice: how storytelling can reinforce the narrative of your local retail business
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For years we have been sharing stories on social media for our own shops. We started this to reflect on the diversity of shopper situations we engage with. The stories provided context for shopping by customers. Here is an example relating the greeting card purchases. It received over 200 lives in less than 24 hours:
Storytime. The twenty-something guy had been standing looking at cards for ten minutes. He seemed lost. “Hey, mate, you need a hand?” I said, without wanting to intrude. “Yeah”, he said with a sadness uncommon for a young guy looking for a card. “What are you looking for?”, I was careful in my approach. “My best mate’s dad died suddenly”, he paused. “He’s angry and wrecked” he paused again. “I, I want to tell him I’m here for him. I figured a card could be good,” he looked back at the range. “But, they’re too flowery.” He was right, the sympathy cards he was looking at were too flowery. After a while, we found a blank card with a dog on it, because his mate likes dogs. We worked out some words that got across what he wanted to say without being flowery.
Some days in retail we get to help in ways that will stay with us for years.
And then there is this one:
Storytime. Joe is 89 years old. He lives in a nursing home. When he moved there, he was limited as to what he could bring. The old shoebox with the collection of cards he’d received was the first thing he chose.In that box are cards from his time as a local community Aussie rules coach. Parents and players had written cards over the years and Joe had kept them. “Each card is a memory”, he says with a smile, looking through his collection.The oldest card Joe has is from 40 years ago from a player grateful for Joe’s help. Here it is so many years on, making Joe’s day.
Greeting cards hold the most wonderful memories.
And this one:
Storytime. Ethan’s school assignment asked that he write about his earliest memory. “That’s easy,” he said, “it was the first letter I ever got. It was a birthday card from grandma. I was 4 and she posted me a birthday card with a tiger on it and it came in the mail. That’s the first memory I have. I still have card, and the envelope. Mum got them framed for me.”
The card created in Ethan an interest in mail and letters more specifically. Now, 6 years on, every couple of weeks Ethan will write to a relative in the hope of receiving a response in the mail. And it all started with that birthday card, which remains his first memory.
Cards give us memories and stories long after they are received.
And this one:
Storytime. “Sorry, it’s just a card, no money for a gift this year.” That’s how Chris signed off the card to Jules, her friend of more than 20 years, since they were in high school together. Swapping birthday gifts with a card and a note were a tradition. Since they lived on opposite sides of the country, they’d usually include a note with the card and gift each year.
Jules wrote back: “your card and note mean the world to me, every year. While I may have, possibly but please don’t judge me, re-gifted the odd gift from you, I have kept every card, every single card from you. I have 23. They the story of us. They are a perfect gift. Thank you.”
The card we send today can provide heart-warming memories for many years to come.
Social media provides us an opportunity to share the narrative of our businesses. Local small business retailers are well placed to have wonderful stories they can share.
Our small business retail advice today is to take a break from shop here or shop local or look at this product and share something of yourself, share stories that speak to those who have shopped with you and yourselves.
Oh, and to answer an expected question for comment about using text and not images? Most social media posts use images. Going with text content could be more easily noticed. Certainly that is my experience in using posts like this over recent weeks.
Small business retail advice: how to calculate gross profit by floor space
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Here is another in our series of retail management advice based on our decades of service to local small business retailers using our Tower Systems POS software:
How to calculate gross profit by floorspace and how to use this information
With retail space usually costing between 11% and 15% of (non agency) revenue, it is usually the next highest cost outside of the cost of stock itself.
Spend half an hour on what we suggest here and the result could provide clarity on immediate steps you can take in your business to improve what you make.
This is not advice you will get from your accountant or from reviewing your P&L or computer reports. It is designed to be practically helpful in managing your business.
Please follow these simple steps.
- Take a blank sheet of paper, ideally A3, and roughly sketch out the layout of your shop, marking in display units, wall shelving, the counter – everywhere you have product.
- The floor plan layout should also include your back room if you have stock there.
- Colour-shade the layout by department. For example, shade all areas with magazines in yellow, all floor space for gifts in blue etc.
- List the departments on the side of the floor plan.
- Calculate the percentage of total space taken by each department. This does not need to be accurate to two decimal places. List this next to each department you have listed.
- Use your computer system to report on gross profit dollars earned by each department over the last year.
- Calculate the percentage of total gross profit contribution earned by each department and list this next to the floor space allocated to each department – on the floor plan map you have done.
- Circle in green those performing the best and in red those performing the worst. A best performing department will typically be responsible for a significantly higher percentage of gross profit than percentage of space allocated whereas a worst performing department will be contributing a percentage of overall gross profit considerably lower than the percentage of floor space allocated.
Once you have the marked-up floor plan with the space percentage and percentage of total gross profit, think about your floor space allocation.
The above steps do not take into account product size and the average gross profit percentage from each dollar of revenue for a department. For example, ink is a lower margin product than stationery, gifts are a higher margin magazines. Typically, the analysis will highlight challenges with lower margin product.
Here are actions the work you do could lead to:
- Changing the location of a department within the business.
- Increasing floor space for a department.
- Decreasing floor space for a department.
- Working on improving the GP achieved for a department through better buying.
- Working in increasing sales for a department to lift the overall GP dollar contribution achieved.
You can take the analysis a step further by looking only at one department and analysing performance by category, using the method outlined above.
For example, in one business we saw pens taking 7% of stationery space while they contributed more than 40% of gross profit earned from all stationery.
The type of analysis we are suggesting here is intended to give you a fresh view of your business as you engage in the process of constant change.
Small business retail advice: if you are finding things tough in your local shop
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We are often asked at our Tower Systems POS software company for help when it is too late. In this article, we share steps any retailer can contemplate from them moment they realise their business is in trouble, from the first thought that closing may be the only option.
Tower Systems is more than a software company. We are retailers too. We cherish the relationships with our retail business customers. We will help whenever and wherever we can to help small and independent retail businesses survive challenges and grow.
If your retail business is in tough times and facing imminent closure, you may be able to save it if you act quickly and ruthlessly. Based on years of working with many different retailers, I have found that some basic steps can successfully turnaround a business in trouble. But you need to be ruthless.
The following tips are designed for businesses with a little (but not too much) time available to fix things. While they are not appropriate to every business, the ideas can lead to others that may be appropriate.
This advice is also appropriate or businesses not facing imminent closure but certainly facing tough times.
Crucial to saving a business from closure is to understand why it is in this situation. You have to be honest with yourself about this. How did it get to this?
- Did you not make changes to your business when you should have?
- Has something local and unexpected impacted your business?
- Have you been a bad retailer, allowing the business to fade away?
Do not be afraid or ignorant in confronting these questions.
Make an honest appraisal of the state of the business as the truth can inform what you do next.
You have to own your situation. This means being realistic about what you face and what got you there. This is important as it opens you to what you need to do to resolve the situation, to rehabilitate your business.
Now, to the urgent steps you could take to avoid the closure of your retail business:
- Know your truth. If you run a computer system, analyse the data it collects. If you don’t know how to do this, find out. Look for surprise information in your data, things you did not know about your business. For example, look at the top selling items. If there are surprises there they could inform other decisions you make to urgently address your situation. Talk to your computer software company, ask for their assessment. Knowing your truth is key to owning your situation.
- Quit dead stock. If you have stock on the shop floor which is old – ‘old’ can vary between product categories – and for which you have already paid, quit it. However, stock that is greater than six months old is a reasonable guide – then take action to sell this at a substantial discount. Move the stock off display units. Line it up to look like clearance stock – stacked up on tables. Setup plain and simple signs indicating the discount prices. Create signage to show it as clearance stock. If you have enough clearance stock in your business, consider signs across your front windows. Give your sale a name that is unrelated to your situation. Here are some suggestions: MEGA SALE, FIRST EVER MARCH SALE, AUTUMN SALE, SMALL BUSINESS MIGHTY BIG SALE. Give it a name you can theme around.
- Run a loyalty offer. Immediately setup and run a loyalty program rewarding shoppers with dollars off their next purchase. The most successful loyalty offer in recent times is discount vouchers whereby vouchers are included on receipts offering an amount which is cleverly calculated by your software based on the items in the purchase. The goal has to be encouraging shoppers to purchase again soon based on the offer on the receipt for items they just purchased.
- Move things around. If your business is in trouble it is likely that it has not changed much in recent years. Change it. Move departments around, shake things up so your customers trip over things they did not think you sold.
- Review prices. Look at the common items you sell, consider a small increase in your prices. It could be a small increase will not hurt sales volume yet will add profit to your bottom line.
- Upsell well. At the counter, work to extend the basket for every sale possible. Do this with clever counter product placement and witty and engaging banter with customers offering upsell products. You goal has to be to make more from each customer.
- Stand for something. What is different about your business? What is special about it? What makes people want to come back? If you don’t know the answer to these questions you’re in trouble. If your answer is we’re the only shop of your type nearby you’re in trouble. If the answer is people have always shopped here you’re in trouble. You need to have a difference that people want and will talk about to others. It could be a product or a service. However, it cannot be a product line that is traditional to your type of business as that will not add value to your shingle in the way you want or need. What do you stand for?
- Market within your budget. Photocopied black and white flyers designed with care can be cheap and effective.
- Attract people who don’t know what you sell. Run a no-cost or low-cost campaign to reach out to shoppers who have no ideal what you sell yet which could appeal to them. They are not to blame for not knowing what you sell.
- Different retail options: Consider becoming an outlet shop selling items from a supplier keen to quit bulk items. Rent space in your shop to another retailer. If you have higher priced items consider offering employees commission on sales. Maybe become an outlet for local artists taking on items on a consignment basis.
- Stop unprofitable behaviour. If you are doing things in your business which lose money or do not contribute to a good future for the business, stop doing them. Regardless of history or what your business might stand for, continuing with unprofitable activity only makes your situation worse. If you know something to be unprofitable and yet you say you can’t stop it, think carefully about that, about why you can’t stop losing money.
- Get suppliers to help. Suppliers often have old stock themselves which they want to quit at a substantial discount. Buy items you have not stocked before, negotiate good prices and put the stock out with a healthy margin but still at a discount to what others would be charging. Negotiate to pay once you are paid by customers.
- Trim employee costs. Cut employee hours and work more in the business yourself if you are not doing so already. While this can have a significant personal cost, the less you pay others the more be business benefits in financial terms.
- Trim overheads. Cut everything you can: cleaning, power usage, insurance, freight, banking. Look at every supplier relationship you have and see if you can negotiate a better deal to cut your operating costs. However, do not turn off lights as darkness is death in most retail businesses.
- What assets can you sell? Do you have computers, retail fixtures, vehicles or other assets you no longer use in the running of the business? If they are not being used, turn them to cash as quickly as possible.
- Get a job. If you have a partner in the business with you and the business can run with one partner, one of you should get a job outside the business. This is especially helpful in a husband and wife situation where the family income can benefit.
- Talk to your landlord. A good landlord will prefer a good business to stay rather than have then close down and a new tenant having to be found. Talk to the landlord, be honest with them about your situation. Given the landlord all of the information they need to make the decision you need them to make. This information will include sales figures, expenses and margin information. Usually, the more transparent you are with the landlord the more they will support your business.
- Talk to your bank. While banks tend to not get involved in lending to businesses that are struggling, it may be that they have contacts that can help you navigate to a solution. Maybe talk to another bank.
- Talk to colleagues. If you have nearby business colleagues in the same line of business, they might have stock they are happy to provide you for free or at a discount to give you stock to move for a good price.
- Refresh the business. Make the business look, smell and sound fresh. Beyond the products you sell and where tings are located, change the environment itself using scents and sounds. Too often when a business is struggling, those involved let standards slip and the business does not look attractive to shoppers. Avoid this laziness at all costs.
- Deliver amazing customer service. When serving customers be the perfect shop assistance and not the owner of the business facing closure. Keep your mind on the job at hand and not the cliff you’re worried might be a few steps ahead.
- Whoever is pressuring you the most to close or contemplate closing, talk to them. If it’s a supplier, the tax office or some other organisation or individual pressuring you about debts, be upfront with them, lay out for them your plan detailing the action you will take to turn your situation around, be clear about what you are doing and outline a timeline step by step for them. Seek their support.
- Set a timeframe. Decide where you want to be in a week, four weeks, eight weeks, twelve weeks. Set realistic goals. Measure yourself against those goals. Know what you will do if you fall short.
What we offer here is general advice, a shopping list of advice from which you can choose. It is intended to get you thinking of ideas that could work for you.
No two situations are the same. No situation is impossible. No business is dead until the doors are closed for the last time.
Never give up. Fight hard and fight smart to turn your business around.
Facing tough circumstances in retail can be like the deer in the middle of the road at night facing the headlights of an oncoming vehicle. Don’t freeze. Take action to mitigate your situation. A series of small steps could be the difference between closure and trading out of the problem.
In your business data there are bound to be opportunities and insights around which growth can be achieved. If you are not sure where to look or what they could mean, ask us. We will help.
Checklist for those considering buying a local retail business
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In our work here at Tower Systems providing POS software for local small business retailers we are often asked for advice about buying businesses. A common question is: what should I ask for when looking at buying a newsagency?
The question itself, when asked, indicates how green a prospective purchaser is when it comes to purchasing a business.
Here is an updated list of data we suggest local retail business purchasers access from the vendor or their representative. We first published this list ten years ago. It has been regularly updated since. here is our latest version:
- P&L from the accountant for at least the last two full years. i.e. not a spreadsheet created for the purpose.
- Management accounts for the current part financial year.
- Tax returns for the same two years. While note always appropriate given business structures, they can provide a cross check with the accountant P&L.
- A good explanation of any add-backs proposed for the P&L.
- Sales data reports, for the last two years, from the POS software in use – to verify the income claim.
- Sales data reports from any external supplier or data source to verify the income claim.
- BAS forms to confirm data in the P&L.
- A list of all inventory to include purchase price and date last sold for each item.
- Copies of invoices from which you can randomly select to verify the above point.
- A copy of the shop lease.
- A copy of any equipment or other leases the vendor expects you to take on board.
- A detailed list of all forward orders placed on behalf of the business.
- A list of all employees: name, hourly rate, nature of employment, start date, accrued leave and accrued long service leave.
- A testament from the vendor as to the claimed accuracy of sales data.
This is good basic information that will enable any purchaser to undertake reasonable initial assessment of a business.
A good business will shine through the numbers just as a business with upside achievable by new owners will shine through.
Our advice to local small business retailers looking to sell who are concerned about this list is: think about it now and focus on your business so the data we have listed looks appealing to any prospective purchaser.
Every day you make decisions in your business that impact many of the data points listed.
This is why we often say every day is your pay day. Run a smart, lean and profit focused business and you will have a good pay day today and a good one when you come to sell.
The most appealing businesses are those that are easier to run and are making money.
The time to focus on that is now.
Sure a purchaser can turn a business around. They should get the rewards if they are expected to do that for your business.
The price you can sell your business for will be based on what it is making now.
Getting the data ready for the sale of the business could, of itself, help you improve how you run your business.
Retail advice: tips on setting up and running a pop-up shop
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A consequence of Covid is short-term retail space opportunities. Ion our work with retailers and through our iPad / tabled based Retailer Roam product we have experience helping retailers with pop-up shops. Here is advice we have to share:
Definition: a pop-up shop is a temporary shop, one that is open for a limited period of time, usually around a month, rarely more than three months.
We have assembled our pop-up shop advice and tips into key topic areas.
WHY?!
Like any business decision, a decision to open a pop-up retail location needs to be based on good research and the business itself needs to have a purpose. So, before you begin, think about why.
Here are some reasons to do a pop-up shop:
- To test new product categories.
- To supplement your income.
- To help quit slow moving stock.
- To enhance your retail experience.
- To experiment with a plan b where you might land if you close your main shop.
- To engage in targeted, temporary, competition.
- To compete with yourself.
LOCATION.
With a pop-up shop you don’t have time to find your customers. The location needs to already have good traffic passing daily, traffic you can easily leverage. Even more so than in fixed-location retail, location is critical.
The best locations are shops that have good passing traffic that is of interest to you and that have been vacant for a while where a landlord might be happy with something rather than nothing.
OCCUPANCY COST.
Negotiate the lowest rent cost possible. Some landlords see pop-up offers as a reason to charge a premium. Only sign up for a price you are 100% happy with. If it is expensive and does not work financially, don’t sign hoping it works out, because in retail it rarely does work out better. In a pop-up business you have less time to see if it works out. Also, preferably, no contingency deposit.
LABOUR COST.
Staff the business with a lean roster. This shop is about selling. that means, products placed for a price proposition rather than beautiful displays that take time to maintain. Every staff member is there to sell and maximise revenue from every shopper visit. There is no room in the roster for fat.
FIXTURES AND FITTINGS.
Don’t spend a cent on fixtures and fittings. That needs to be your starting position. It’s a pop-up shop. People expect it to be efficient, cost-effective. Using tables and boxes adds to the feel of the shop feeling low-cost and that can help drive sales. Suppliers can be a good source for loaned fixtures.
INVENTORY.
Ask suppliers to offer consignment stock or special clearance deals they’d like to move fast. Go for items that can be sold out of a box, to make display and ranging easier. In-box displays of particularly cheap items can work very well.
PRICING MODEL.
Price to sell. This means being below usual retail. Price to understandable price points. For example, you might have a $10 table, a $20 table and so on. Consider bundling items into packs, which make price comparison difficult.
PROMOTION.
Don’t spend money on sign writing or marketing. Use social media and bargain websites and anywhere similar where you can list the store and its products.
Host an opening party. List this as a local event on Facebook.
MANAGEMENT MINDSET.
Your mindset in managing the pop-up shop needs to be different to a fixed-location retail situation. Pop-up shops are about low cost, low overheads, low prices. Be ready to do deals. Whoever manages the pop-up shop needs to be different to how they would be in the fixed-location retail business.
SPEED.
You need to move fast. From the moment you sign a lease or agreement, the clock is ticking. Ideally, you’d open within 24 hours and when you are done, closing and clearing out the shop is done in 24 hours or less. This is all about maximising the time for income-production.
TRACK PERFORMANCE.
Cultivate good data that can guide business decisions for your next moves.
Is a pop-up shop worth doing? Only you can determine that. We have seen plenty of pop-up shops work well for the retailers, contribute good GP, help move slow stock and help open to the owners category opportunities not previously considered.
Do the planning and you should expect to benefit.
10 ways the Tower Systems POS software is helping gift shops deal with pandemic challenges
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Gift shop retailers using the Tower Systems POS software have at their disposal a proven suite of tools and facilities with which to combat the blues which seem to surround so many retailers at the moment.
By engaging with the marketing and management tools in the Point of sale software, retailers can expect to cut costs, increase sales and drive bottom-lime profit.
These claims are more than a sales pitch. For no additional cost, local small business retailers can drive more profitable and more valuable business outcomes … and turnaround what may be a tough retail situation.
Using the Point of Sale software from Tower Systems, retailers can expect to:
- Cut costs. Thanks to electronic invoicing, the cost of processing new stock is lower than with manual processes. This can help cut your labour bill.
- Increase sales #1: reward customers. A good loyalty program works. Not like FlyBys which is of dubious financial value to customers. No, a serious loyalty program which guides your customers to spend more money with you. I have see stores grow sales by 10% on the back of a well constructed loyalty program, a good POS software package will run this for you, points and all.
- Increase sales #2: easy lay-by. Lay-by run properly and using technology can be highly profitable. The software can manage the rules and ensure that your shop operates as professionally as a national retailer. You set your own rules and the software manages the paperwork.
- Increase sales: market to your customers. A coupon on your receipts, an email newsletter, a printed newsletter or up-sell script at the sales counter for staff – these are all ways you can use your point of sale system to help guide your existing customers to spend more money with you.
- Increase sales #5. Connect with a local charity. Use your gift shop software to make it easy for a local charity to promote your retail business shop and raise money for themselves at the same time. Each sale earned for you by the charity can be tracked so that you are able to reward them with an accurate donation at the end of the campaign.
- Make better business decisions. Bu buying only stock which works for you or seeing exactly what customers buy with what you are able to make business decisions which are more likely to drive better business results.
- Sell your own gift cards. If a customer cannot find what they want in your shop you could sell them a professional looking gift card with a unique barcode allocated to that card. This way they money they put on the card is used in your business.
- Cut mistakes. Mistakes in retail can be expensive. By using smart retail management software, you can and should expect to cut mistakes. This is because it takes fewer keystrokes per sale. This reduces the opportunity for mistakes. The saving could add as much as a full percentage point to your bottom line.
- Cut theft. Theft in retail in Australia was running at between 3% and 5% of turnover. Thanks to tight controls around employees and better tracking of stock theft, you can expect to cut the cost of theft. Every $1 cut in theft is a $1 on your bottom line.
- Handle special orders. Using software you can place orders for specific customers. The software can even sent a text message to the customer’s mobile phone when their special order comes if. Talk about customer service!
The most important way you can grow your business in a tough marketplace is doing what you probably do best – providing cheerful and knowledgeable customer service. You can do this and your employees can do this if you hand over some of your administrative tasks to your software.
It is easy to get drawn to the doom and gloom of the times and through this to lose focus on your business. This trap must be avoided at all costs … for the sake of the business and all who rely on the business from customers to employees to owners.
By using tools freely available in your Point of Sale software you can find sales, find time and find margin which may have eluded you to this point.
Small business retail advice: make your shop more valuable
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Too often small business retailers focus on the sale of their business as their pay day without actually acting, every day, to ensure that day delivers the best value for them.
Every day in any local small retail business there are decisions that can be made, steps that can be taken that nurture more value from the business. These steps, most of which cost little or nothing to implement, can have long-term gains for the profit and loss of a retail business.
We see this in our work with more than 3,000 local small business retailers. We see the value of good moves. We see the costs of inaction.
Thinking about this, what we see, here is a list of 10 things any local small business retailer could do in their business to drive value today and, more importantly, value tomorrow when they choose to sell their business.
This list is in order of the value we see being achieved in local small retail businesses that act on these things.
- Deal with old stock. Old stock is worthless to you and anyone being the business. Keeping it is a waste of space, time and cash. This work starts with you knowing what is old stock – our POS software helps with this.
- Trim the roster. Labour costs around 11% of revenue. Every dollar saved is a dollar that benefits the P&L. Yes, this likely means more hours for owners … but you have to ask yourself about your focus as to when you want your pay day.
- Review opening hours. Often in business data we see opening hours opportunities – either for longer hours or shorter hours. be guided by your business data.
- Clean up online. Be easily found. Review your Facebook, Google and other listings. Make sure they are current for if they are not it reflects poorly on the business.
- Declutter. An appealing looking business is easier to sell. On the shop floor, at the counter, in the back room – declutter and make the business more appealing to you, prospective buyers and customers.
- Review unprofitable activity. Look carefully at each category of product or service you offer. Get to an accurate understanding of the value of each. Consider quitting those that are under performing.
- Price for margin. While plenty of retailers pressure suppliers for lower prices, too few actively consider what they could sell some items for, missing the opportunity for a better margin. Where you can, price for a better margin.
- Document. Write up your processes, systems you follow and more. Document this and make the business easier to run and appear easier to run. The documenting process itself is likely to lead to efficiency opportunities uncovered. The resulting documentation will make the business more appealing.
- Reduce debt. We see too many retail businesses where debt is used with an expectation that it will be dealt with when the business is sold. Clean it up now as much as you are able. The less interest you pay the more money the business makes.
- Balance sheet clean up. While selling a retail business will often not include selling the company structure, the tidiness of your balance sheet may not be ideal for that time you do come to sell. It’s better you discover this and work on it prior to needing to.
This advice is part of the regular advice Tower Systems provides its customers.
Small business retail advice: how to deal with a cashflow crisis
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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. We have put together some basic advice for dealing with a cashflow crisis in local small business retail and share it here with you today:
- Own the problem. Fixing this is on you.
- 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, someone prepared to tell you the truth.
- Understand the problem. Know if it is short term or long term. Be certain about the role you have played.
- If you run customer accounts, collect with urgency.
- 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.
- Cut your roster to bare bones. Yes, this can mean more work for you to cover the needs of the business. However, in a cashflow crisis, your labour cost is the lowest in the business.
- If you have stock on sale or return and it is not selling, return for credit.
- Immediately start a sale.
- Give it a cool, non scary, name.
- Price items to sell, especially items for which you have already paid. Even selling below cost frees cash to the business.
- Get everything on the shop floor.
- Display to clear. i.e. not pretty displays for sale items.
- For inventory that you cannot sell, consider eBay.
- Consider selling assets. If you have equipment in the business that you no longer use, sell it.
- Talk to all your creditors, apologise, outline your plan, ask for their support and help.
- When making progress payments on creditors, respect all with payments. NOTE: small regular payments could be key to you not facing debt collection action.
- 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.
- 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.
- 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 decisions in the business. Be thoughtful in each decision and single-minded in your focus on a better cashflow outcome.
Small business retail advice: if you think closing and walking away is the only option
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A few years ago, a local retail business we knew well closed, and the owner walked away. They said they could not handle the changes going on around them.
The thing is, the changes had been happening, slowly, for years.
The biggest challenge faced by the retailers is faced by many in local small business retail: how to nurture relevance for your shop in a constantly changing world.
It takes guts to embrace and chase change. The sooner you engage with this the better. This is what we say chase change, because that is what we need to do – go find change rather than waiting for it to come to you. Advice on change and help with it will most likely come from new sources, sources not rooted in your past.
The more you reach outside your usual lane for insights and encouragement the more likely you are to find fresh ideas. the alternatives are to do nothing or complain and do nothing.
Complaining is not a management activity.
Here is some practical advice for any retailer feeling overwhelmed by challenges and, maybe, contemplating closing.
- Dig deep into your business data and look for green shoots of good news onto which you can attach growth. It will be there, for sure.
- Stop doing what you have been doing, unless you want the results you have been getting.
- Rely on retailers for advice as they know more about retail than accountants.
- Find products that will generate net new traffic in your location.
- Refuse to be restricted by the shingle under which you trade
- Change, change and change your business.
- Listen to your shop floor team members. They often have the best advice.
Change is challenging. It is also essential. Too often we see local small business retailers resist change out of fear, ignorance or an expectation that things will naturally improve. The reality of retail today is that change is everywhere, including where we cannot see. And, this is what makes it difficult for us in that if we can’t see something we may not worry about it.
One of our jobs in our POS software company is to encourage local small business retailers to be the best they can be. Through good use of our software we can do this. But, it starts with desuire, desire for change and the benefits that flow from change.
Small business retail advice: create your own Covid support package
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How people shop, when people shop and where people shop has changed fundamentally. Online has grown and continues to grow. People shop more with purpose now. There is less browsing. More people work from home permanently. What interests people has changed. People think more about the future now. People are less physically connected now, and more connected as a result. Australian made is more interesting to shoppers now. Shopping local counts for more than it used to. Tech barriers from before have been overcome: think QR codes, click and collect and the number of people shopping online for the first time.
These are some of the changes Covid has brought our way and in each of these is opportunity. While some business owners ask governments for cash to deal with today, it’s tomorrow that will really challenge as what Covid has kicked off and pushed forward will not u-turn.
We need to make our own Covid support package as it is this package that will be more useful to us in the future.
- Expand sources of revenue. Carry products and services that attract people who have not shopped with you before. Expanding your shopper reach insulates your business.
- Smooth the peaks. Look at your key business data points: sales by product category, sales by supplier, sales by staff member. Look at the peaks in these and if they are considerably higher than average, lift others so you are less reliant on the peaks.
- Expand your sales points. Having only the in-store sales counter as a sale point is a risk. Make sure you are online through your own website, on eBay and on social media so people can purchase where they want. Selling to people you will never see is key.
- Nurture loyalty. Run an easily understood loyalty program that differentiates your business.
- Chase efficiency. Efficient shopper visits have more items in the basket. Develop a strategy for driving this. It starts with understanding your current position.
- Entrench in the community. Supporting the community groups that support you is good for business. Doing this in a consistent and mutually understood way delivers benefits that can insulate the business when rocky roads present.
- Be frugal. Covid has taught us the value of having money in the bank. The trimmed roster, reduced inventory in the back room, lower overheads, early settlement discount taken … they all free cash that can be banked for when you will need it.
- Reduce debt. Every additional dollar you pay off business debt is a saving greater than the dollar itself.
- Look for the pivot. Keep asking yourself what if this or what if that. Think about pivot opportunities in those situations. Always have a pivot move or two and, if it makes sense, pivot early, ahead of the need.
- And, have your shop reflect how people shop now: make it easier, safer, serving quick shopping, packaging bundles, offer browsing without touching.
By being actively engaged in these and allied areas in your business you can create your own insulation against the challenges of Covid or similar. These suggestions and others they trigger make up your own made Covid support package.
Advice on dealing with anti-maskers in small business retail
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The latest lockdowns in New South Wales and Queensland have seen small business retailers confronted by anti-maskers out to make a point for their nutty views. Vocal anti-maskers in-store make for a possibly unsafe workplace.
While we are not legal experts, we offer the following advice to retail business owners:
- Provide your staff with appropriate personal and business equipment for their protection: screens at the counter, masks, hand sanitiser … all backed by appropriate Covid protection protocols. Keep this updated. For example, have an endless supply of masks available.
- Ensure customers know, from front of store signage and social media posts, that masks are required in-store. Use clear signage.
- Have masks available at the entrance to the shop for customers, for free.
- Demonstrate active understanding of situations where someone may not be able to wear a mask, for health reasons for example.
- Have a protocol for dealing with a vocal and / or threatening anti-masker and ensure that all staff know the protocol. This protocol should include a means by which a situation can be easily reported – a specific bell ring, for example.
- As the business owner, be engaged in dealing with anti-maskers.
- Meet with employees regularly to talk about the situation, to decompress. Make sure they understand and see that you support them.
- If the business is being targeted at all, position yourself at the front of the shop to run defence.
- The goal has to be to not directly engage with an anti-masker, to avoid making the situation worse, but to get them out of the shop as quickly and efficiently as possible.
- Ensure your CCTV is working, so you have evidence or any portable offence.
- Engage the police for any unsafe or threatening behaviour.
- Appreciate good customers in-store and on social media – celebrate their actions for making the shop safe.
- Put the health and safety of employees ahead of what a customer may think is their right to free speech.
Dealing with anti-maskers in a retail business is all about leadership. The solution has to be set and led by business owners. leaving it to front line retail staff to deal with would be, in my view, an abrogation of responsibility. Show your employees how much you care about them by actively engaging on this issue.
A Covid lockdown To-Do list for local small business retailers
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Here in Melbourne we are in our fifth Covid lockdown. As well as owning our POS software company and working with local small business retailers every day, I also own three retail businesses and several online businesses.
This Covid lockdown To-Do list for local small business retailers is practical advice you can action without cost, to make the most of the lockdown opportunity.
Whether your shop is closed or open but with less traffic, now is an ideal time to work on your business.
- List what’s not sold. Run a report listing all inventory in the business that has not sold at all this year. This list gives you a starting point for action. We did this last week for one customer and identified $15,000 worth of dead stock, stock the owner to that point was not focussed on.
- Act on what’s not sold. Dead stock is dead weight. If you have long since paid for it, cents in the dollar for it is better than nothing.
- Look at what’s been selling with what. Often the items in the same basket are not seen by retailers as items you can put together. This list, which you should be able to get from your POS software, can guide shop floor placement changes.
- Front to back clean. Literally, start at the front of the shop and work your want to the back. Clean every single product. We often find that the act of holding every product leads to decisions about some products, decisions we might otherwise not have made. We have just done this at one of our own Westfield shops and the decisions we made along the way have been liberating.
- Work on your roster. Look at what usually sells by day of week and by time. Your POS software should be able to help with this. Take time to review your roster to ensure it is set appropriately. Labour is usually the top or second highest cost in a retail business outside of inventory.
- Reset the front third of the store. Look carefully at that front third of your store. Make bold changes simply by moving things, so that when shoppers return they see things they’ve not noticed before.
- Prepare social media content that leverages you. Using your phone, film short videos of you or a team member talking about products. Prepare these to load over time on Facebook, Instagram and more. Have fun.
- If you have a website for the business, write blog posts as they are absolutely the single best thing you can do to attract traffic to the website. A blog post should be single topic, pitch a consistent keyword at least five times and be over 350 words. We have a lot of experience with this and note, again, this is the single most effective online marketing for a website. The only investment is your time – don’t outsource this.
- Learn something new. Ask your POS software company for the best report in the software to reveal what you are unlikely to know about your business. Run that report. Read it. Make a list of things you could do. Act on it.
- Be a shopfitter. Shopfitters are expensive. Look at an area of your shop that you want to change that you would usually hire a shoplifter to handle. Think through how you can do it yourself. I know many retailers who have done this and vowed to not use shopfitters for such changes in the future.
- If you are online, undertake a data driven review of your website. Look at your traffic and the traffic of your competitors. Review your site and theirs. Look for opportunities to attract more shoppers to your site based on the data. Whoever developed your website should be able to collate this data for you.
- Personally: refresh. If you can take a break from business, even for an hour a day, read fiction, listen to music you love, go for a walk outside. These nourishing things can help reset mood and that could help you discover new opportunities for your business.
We are a local Aussie POS software company serving 3,500+ local small business retailers with POS software and beautiful Shopify websites. Beyond this, we also offer retail business management advice and help to our customers every day.
Thanks for reading. have an awesome rest of your weekend …
Mark Fletcher | mark@towersystems.com.au.
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