Don’t underestimate value of connecting with customers
Don’t delegate financial mattersIf you don’t know the problem, how can you fix it?
If your business can't afford a high salary, neither can you!Don't work for nothing to build your businessBusinesses where owners work for nothing don't last.Don't end up hating your business.If you must work for nothing consider your time a loan that your business must eventually pay back
Shopping at other stores gives you info to guide future business decisions
And Not just rent - stack of extra chargesupkeep of common areas, building maintenance, charges, taxes.
Controlling Your Buying
Controlling Your Buying<br />Debra Templar: Retail Check ups, Tune Ups & Makeovers....It’s in the bag! <br />
Tips When Visiting a Gift Fair or Trade Show<br />
3<br />Spend the first day ½ day or so just looking around. Absorb information – who’s selling what and for how much.<br />Take a few notes about places you’ll stop by later. <br />See who’s busy.<br />The biggest asset you’ll have is KNOWLEDGE OF THE MARKETPLACE. Knowing what’s available in a category is a valuable negotiating tool.<br />Great buyers get the best deals – not necessarily <br /> the biggest stores.<br />Buying is more than “ I love it, <br />I’ll take it”<br />
Never buy without a buying plan or a budget showing you what you can spend for the various categories or departments in your store.<br />Make a list of the vendors you want to see and, if possible, make appointments<br />
Introduce yourself and your store.<br />Never ever try to act as if you know more than you do or give an impression that you’re a big buyer, someone who places big orders.<br />Being humble works in building professional relationships – but don’t OVERDO being humble or you’ll get taken advantage of. ( “ I’m a small store. I try to be a loyal account and pay my bills. I just want merchandise that sells. I don’t want to be your biggest account”).<br />
What other stores do well with your line?<br />Who else do you sell to in my area?<br />What kind of order minimums do you have?<br />Are minimums strictly enforced for a new store?<br />Do you have any promotional or off-price merchandise I can buy to help me maintain a good mark-up with your merchandise?<br />Is this merchandise re-orderable?<br />Do you have any colour photos you could give me (at no charge) so that I can use them in my advertising?<br />Do you offer any classes, cds, a website or <br /> literature on how to sell your merchandise better?<br />
9. What do I need to do to get a little better price?<br />10.Do you offer an extra 5% if I leave my order with <br /> you now?<br />11. If I buy something and it just isn’t selling, can you swapthings over for me?<br />12. Do you have a private label program?<br />13. When do your prices break in the season?<br />14. When will the goods be delivered?<br />15. What are the terms of payment?<br />16. Can I get dating?<br />
Leaving an order with the sales rep when you view their line..<br />Take a look, make notes, take photos (if allowed) and get back to the sales rep to buy the stuff you actually want to buy.<br />Sales Reps, however, will want to get your order on-the-spot.<br />Let the Sales Rep know when you plan to place your order – then stick with your promise.<br />Good reps can be very valuable allies – <br /> don’t aggravate them unnecessarily.<br />
DON’T rush your buying. Take your time. Network with buyers. Ask them what’s hot. Spend the time to shop, buy and place your orders. <br />ALWAYS remember the brand you’re trying to create. Make sure the merchandise fits in.<br />This is the time to test, test, test. Don’t buy too much of any one line.<br />
Use your own order forms or purchase orders. Saves you money and time +<br /><ul><li>You’ll have a better feel for how much you’re buying.
Your buying terms, not the manufacturer’s terms, are listed on the purchase order. Eg. Your Order Form may state that you will pay 30 days from the date you receive the merchandise. Manufacturer’s form may say 30 days from the invoice date.</li></ul>How to pay?Credit card – additional 30 days + frequent flyer points<br />Open an Account.You always want to be able to pay for the merchandise after you have had time to sell it.<br />
Ordering merchandise should be a partnership – you don’t have to agree with the rep’s opinion – the final decision is yours. But at least you’re respecting their knowledge of the line.</li></li></ul><li><ul><li>Make sure merchandise appeals to widest market possible:
Paperwork</li></ul>Open to Buy<br />The system works but has two basic problems:<br /><ul><li>It’s time consuming (without a spreadsheet)
It doesn’t take into account your ability to pay for the merchandise</li></ul>BUT there is an XL Spreadsheet that calculates everything <br />for you!!<br />
7 #Fail<br />Turnover<br />Being in the dark about competitors<br />
You must understand:<br /><ul><li>Turnover: How many times you sell and replenish the merchandise in your store during the course of a year. </li></ul>Divide your annual sales figure by your average inventory (at retail prices) for the year.<br />
The more times you can turn over your merchandise the better. Here’s why:<br />You’ll have less old merchandise<br />You’ll have more opportunities to buy. This can lead to better buys and being more current with your offerings.<br />You’ll have less money tied up in your inventory<br />
This simple ratio divides your sales for a given month into the amount of merchandise that was in your store at the beginning of the month... ie. How much inventory does it take to sell X amount?<br />Obviously the less inventory it takes, the better, because then you spend less money on inventory.<br />Stock-to-sales is related to turnover in that it tells you how well you’re managing your inventory<br />Ideal ratio 3:1 (3 month supply of inventory – you can change inventory with the seasons). Also maintaining strong inventory level yet new merchandise is coming in <br /> all the time.<br />
40-55-5 Rule<br /><ul><li>40%of the money you made on sales will go toward expenses. It can be less, but never more.
55%of the money you made on sales will go toward new merchandise.
5%of the money you made on the sales will become your Positive Cash Flow (PCF).Technically you can’t call this profit, but that’s really what it is </li></li></ul><li><ul><li>Designed for businesses that work on 50% markup or better.
This system assumes new merchandise is what generally sells well – customers want to see what’s new, not what’s old.
Open to Thrive answers the question of “How much inventory can and should I have?”
Will also tell you if your expenses are in line.
It works with actual invoiced costs (not retailing selling $ or markdown totals). This eliminates chances for error.
If you follow the Open to Thrive system, you will always know if you actually have money available to buy more inventory.</li></li></ul><li>Does not focus on your current level of merchandise although I recommend that you take an inventory before you begin to make sure your stock-to-sales ratio is between 3:1 to 4:1.<br />If your inventory is larger, start promoting goods to get rid of them, unless you’re at the beginning of a season such as Christmas.<br />If your inventory is smaller or if you have a new store, estimate what your sales will be in the first month and have three times that inventory (at retail) on hand – that’s your starting point.<br />
Buy whatever you like, but make sure that, at the end of the quarter you balance your expense and merchandise received numbers to come as close as possible to the 40-55-5 Rule.
If you’re off, you’ll know what actions you need to take to correct the situation to be in better shape for </li></ul> the next quarter.<br />That’s it, that’s the whole Open to Thrive System. It allows you to become your own consultant.<br />
One of Australia’s leading retailing experts, Debra Templar just hates bad customer service and stupid business practices. So… she’s on a mission to change them – one slideshow, presentation, book, or training session at a time:<br />"I don't just want to improve how we do business for the customer’s sake but also that we, as business owners, sell more stuff, make lots more profit, and love our businesses back to life!“<br />E: firstname.lastname@example.orgMobile: 0417 532383<br />www.thetemplargroup.com.au<br />www.twitter.com/DebraTemplar<br />www.linkedin.com/DebraTemplar<br />Pic Credits: http://www.istockphoto.com<br />