Monday, June 14, 2010

Saving Pennies can help save the day......

The retail outlook continues to remain challenging as we look toward the balance of 2010. While the economic recovery that started this year hasn't quite materialized the way most pundits expected, that does not mean that it has to be all doom and gloom for your retail business.

By continually assesing your business goals and objectives, and aligning your customer needs as priority one, you can and will survive this economic downturn.

Just as importantly, you must continue to assess your business expenses and look to trim wherever and whenever possible. As we continue with our mid-year business review process, review the following areas to determine if there are any additional savings to be had.

Cost of Goods Sold. Can you negotiate with suppliers for discounts based on year to date purchases or other shipping programs? Do you ask for allowances from vendors for past date cancellation orders, or orders shipped outside of the start/stop order dates?

Marketing. Analyze where your optimal return on investment occurs, proactively seek out deals from channel partners and request support from your product suppliers - they all have a vested interest in your success. Have you shifted your allocation of resources to more cost effective means in 2010? Can you expect to produce the same savings in the second half of the year?

Payroll. Assess training and development requirements and delay/eliminate where possible, increase the utilization of more productive sales staff and contingency plan for deferred bonuses

Technology. Re-assess near term capital expenditures to ensure adequate payback hurdles and make due with current non-sales critical assets

Rent. Assess the real estate market, gather data and speak to your landlord about reductions in rent

Banking and Credit Card Fees. Consider incentives to generate cash sales and negotiate with your banker and credit card processing companies for reductions in all fees

By throughly reviewing the expenses that you do have, and looking at the areas where you can negotiate more effectively with suppliers, I'm confident you can save quite a few more pennies before the end of 2010!

My Tank Gets 30 MPG - Is That Good?

If I told you my vehicle delivered 30 miles per gallon would you say that was fantastic, average or awful? In order to answer that question you would need to know several key facts. Am I talking about a Vespa or a Hummer? What do cars like mine get for average MPG? What type of gas mileage did I plan to get with my car? Without considering these factors, answering the question would be premature and would have no frame of reference.

As with the car mpg, many retailers deliver marketing programs yet they have no idea about what results they can or should expect to deliver. In essences, there is no goal setting, thus no frame of reference for the results that are achieved. Are the results good? Did I use my resources (time and money) effectively on this marketing program?

Best practice retailers know that performance assessment on all marketing activity must be done to determine their ultimate effectiveness. If you haven't quite got in that habit yet for your business, June is just the time to review how your marketing plans are performing so far this year. Take a piece of paper and ask yourself the following questions related to your marketing events thus far in 2010:

  1. How much money and resources did we invest in each marketing activity?

  2. Did we implement this activity optimally?

  3. How much incremental sales were driven by the marketing activity?

  4. How many new customers were generated by the marketing activity?

  5. Did my in-store staff capitalize on all the opportunities created by this activity?

  6. How much new customer information was generated for the customer relationship management system?

  7. Did the activity deliver new insights into customer needs that can be used to increase profits or market share in the future?

  8. Did this activity contribute to long term customer loyalty and subsequent repeat sales?

  9. How effective was each marketing activity relative to each other?

  10. What are the industry leading benchmarks for these activities?

Answers to the above questions can help answer questions about yor marketing planning, effectiveness and about how your business is at implementing programs. If you don't like some of the answers you gave, or frankly, don't know enough because you didn't set objectives for the marketing activity you did deliver, now is the perfect time to re-tool and plan better for the balance of 2010. If necessary, get key stakeholders in the organization involved to help you maximize your success.

Keep in mind that successful marketing for your business is linked to overall goals and objectives that can and should be tied to industry benchmarks for success. After all, a tank isn't designed to perform like a scooter either. Don't let your marketing programs perform like a tank this year.

Is Your Marketing Hitting the Mark in 2010?

Retail 101-Marketing IS essential for a retailer to effectively communicate with its customers in order to sell more AND to make more profit. Marketing is the key to manage your businesses' reputation, to maximize the flow and liquidation of of inventory and to launch new brands and intiatives that will catapult your store to it's next level of success. So the question we ask today is how are you managing this most critical element of your businesses success thus far in 2010?

As we approach the mid way point of the year, now is a great time to revisit your annual marketing plan and to consider if you're getting the results you anticipated from the marketing plans set forth for your business. It's time to ask yourself these tough questions to determine if the plan needs to be refined for the second half of 2010.

Question #1: Do you target the right customers? Although many retailers "think" they know their customers, in many instances this is not the case. Customers continue to evolve and are more sophisticated every day. It's ok to acknowlege that not everyone may want your products, but it's critical to focus on the ones that do, and to find ways to "meet" new customers who want your products, but just haven't been introduced to your store yet!

Question #2: Do you understand your customers' needs? The biggest element of marketing is to understand what your customers - and potential customers - actually want. With so many tools available to survey customers today, it must be a part of your marketing efforts to check in periodically and make sure your product assortment is hitting the mark. Simply put, if you make mistakes in the inventory arena and you purchase products people don't want - and your sales will be minimal resulting in higher than expected markdowns- to say nothing of the disappointment your customers will experience by not finding what they really want.

Question #3: Do your potential customers know about your store? So you know what your customers want and you have stocked your shelves with the perfect selection of products, but ensuring your customers and prospects know about it remains the critical communication piece to your ultimate retail success. Many retailers use the wrong communication channels and fail to let their target audience know that the products they want are available in their store. Make sure you are speaking to your customers where they are actually listening. ie. Are your customers using social media sites like Facebook, You Tube and Twitter, but you're not communicating with them in these venues? It's a missed opportunity for your business!

Question #4: Do you communicate effectively with your target audience? The actual words you use in your marketing messages are crucial. Not just what you write, but the way your write them. Everyone knows that only benefits sell and not features - but extracting the benefits that are going to turn your prospects into paying customers is perhaps the hardest part of marketing. Reconsider the message you are sending to customers and what your "call to action" incents your customers to do and to drive store visits and ultimately sales.

Question #5: Are your projections too ambitious? Everyone thinks their new products will fly off the shelves, but in reality this is rarely the case. Your marketing plan (and inventory strategy) should show a realistic path to profitability that aligns your actual revenues and profits with your written plan. Analyze your financial plans, or have a trusted advisor review them, to determine how realistic they are and what adjustments may be required.

A thorough analysis on the first half of the year's marketing plan and its results will ensure that the second half of 2010 is more productive. Marketing planning is not a static activity. It requires careful monitoring and refinements to maximize return on marketing investments.

Keep us posted on your progress. We're committed to helping you succeed in 2010 and beyond!

Bargin ways to boost staff morale - and boost the bottom line

Your staff is the most important line of attack (and defense too) that you have in dealing with customers today. They are the key success factor bringing, or failing to bring, money into your store. As it gets harder to get customers to spend money, your sales staff may be feeling a bit down about their performance, especially since the register isn't ringing quite like it used to.
How about a bit of a morale booster from you to show your support for them.

Building morale is not always about putting more money in their pockets. It's about letting them know you appreciate them and building trust and long term value. You do not have to spend a lot - or even anything at all - to do something great for your staff. Try these ideas on for size.
  1. Send them all a personal thank you note

  2. Make your famous chocolate chip cookies

  3. Ask a supplier to donate a small gift for every employee

  4. Put their name and pictures in your monthly newsletter along with a thank you

  5. Create a photo bulletin board with fun pictures from the past year

  6. Organize an outdoor activity; Close the store on Sunday afternoon if you have to for a softball game, bike ride and picnic

  7. Invite them to dinner at your house

  8. Give one person each week an extra long lunch and pay for it

  9. Stick a post-it note on their paycheck noting one important contribution they made in the last pay period and how much it means to you

  10. Make a donation in their name to their favorite charitable organization

The more personal the gesture the better it will work. Your staff is your key to success. Thanking them with things that don't cost a lot of money but show that you care in a very personal way will go a long way toward ensuring that success for a long time to come!

How do you show your staff your appreciation? Share with us at

Boston Commercial Real Estate Improving

Just read an article on discussing the commercial real estate environment in the Boston area. With rents reduced as much as 30% in some locations, vacancy rates are reducing, but the mix of tenants is changing the makeup of certain malls and retail clusters.

Read more at the link below.