Guiding Your Retail Business through a Downturn
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Many small business retailers are worried about all the talk of a recession. Some analysts are predicting that there will not be a recession at all but instead we will have a long period of much slower growth. Either way, what with high fuel prices, larger gas bills and rising food prices, your customers are more likely to have less ready cash to hand over at the tills.
Here are some strategies you can use to get your retail business through this patch in one piece ready for the upturn in the economy that will hopefully come soon.
Opening Hours
Close early on the days business is guaranteed to be slow so that you can open longer hours on the busier days.
Store Layout
Redesign your store layout so that lower cost items have more prominence. Look at ways to improve the lighting in your store so that the displays are brighter and buy some spotlights so that all areas are well lit.
Inventory
Find suppliers that can meet your requirements just in time so that you can carry lower stocks; order less but more often. Markdown and shift slower selling lines, so that you can make room for faster moving value items. Get rid of all dead stock and monitor how quick or slow each item is moving so that you can utilise the best areas in the store for faster moving stock.
Special Offers
Introduce discounts, like buy 3 for the price of 2 to persuade your customers to buy more. Offer special promotions of the day, week and month so that customers feel that if they don't come often they might miss out on a bargain. Introduce loyalty cards so that regular customers get preferential treatment.
Staff
Reduce the number of full time employees and take on more part timers. Train your staff so that they have better product knowledge and know how to treat your customers better. These two strategies combined, will give your business more flexibility to cope with any expected downturn.
Costs
Examine all your outgoing costs and be ruthless with any unnecessary expenditure. Check out your energy suppliers, telecoms providers and courier companies and if they are no longer competitive, switch quickly to the lower cost operators. Monitor all your bills paying close attention to the top ten that probably account for more than 80% of all your outgoings.
Cashflow
Buy as much as you can on credit and reduce the amount of goods sold on credit. Cash is king and having some at hand will mean that you can cope better through any downturn and also take advantage of special offers from your suppliers whenever they arise.
Hope this helps,
Naz 