5 things every new retailer needs to learn fast
When you start a retail business, there can be a lot to learn. Here are five things you need to know by the time you open the doors on your first day.
1. How to sell like a pro
Even in today’s world of online reviews, you should never underestimate the power of a good salesperson. According to research by global management consultancy McKinsey, nearly 40% of customers remain open to persuasion once they enter a store despite having already researched the product and its price online.1
To close a sale, you and your salespeople need to know your product better than Google. You need to passionately demonstrate why the product is a must-have and be ready with answers for all the questions your customer might have. The biggest mistake salespeople make is talking more and listening less. Ask questions to uncover needs of the customer and then give them your sales pitch.
2. How to make payment simple
Time is money, both for you and your customer so you need to be able to process payments swiftly, especially during busy times. Cash, card and mobile are the most widely used payment methods that retailers should offer.
A smart till like My Business Hub gives retailers flexibility to take payments anywhere within the premises so you can approach a browsing customer on the shop floor and take their payment there and then.
3. How to price for profit
This is the trickiest bit for any retailer – how do you keep the price low enough to close a sale and high enough to get the best margin? First and foremost, know your market and adjust your costs so that you can offer a competitive price. Keep an eye on your rivals and ask yourself “Why would customers choose my product over another?”
Offer a good marketing mix that includes “refer a friend” or “bulk buy” discounts that not only lead to sales but will also help you attract more customers in the long-term. More importantly, listen to any feedback your customers might have on pricing and tweak your strategy accordingly.
4. How to take stock of inventory levels
Getting stock levels right is crucial for the success of any retailer. After all, you don’t want to be left with stock you can’t shift. However, not having enough stock obviously could mean you have nothing to sell. To get your stock levels right, you need to get your projections bang on.
Tools like My Business Hub can help you identify your top selling items and how demand has varied over the past few weeks and months. If your products are affected by seasonality, then come up with a plan of action for it. To use two very simplistic examples, chocolatiers and florists will see sales peak around annual holidays and special occasions, such as Christmas and Valentine’s Day. Competition for temporary staff and securing the best products or materials from wholesalers will be harder in the lead-up, so planning and sourcing early will put you in a stronger position.
5. How to manage accounts
No matter how amazing a salesperson you are and how appealing the range you’re selling might be, it all boils down to one thing – numbers. Are you selling enough to pay your bills and make a profit? You should watch your accounts like a hawk and ensure you’re keeping a check on your costs so that they don’t eat into your profits.
Be it leasing or renting a retail space or new marketing activity, your accounts should entail every possible cost your business is going to incur. You should also make a six-month, one-year and five-year plan with the sales and profit targets you need to hit so you can track your progress.
1 David Court, Dave Elzinga, Susan Mulder, and Ole Jorgen Vetvik, “The consumer decision journey,” mckinseyquarterly.com, June 2009
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