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Retail Advice During Economic Crisis
Posted: November 7, 2008
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Energize your sales staff with a units per transaction (UPT) contest. UPT shows you how many units or items were sold per sale. Initiating a UPT contest is not only a great way to evaluate who your best salespeople are, it will also help you get a little extra out of everyone, including those salespeople who normally have a low UPT average. "Encourage everyone to sell at least two items per transaction and offer a prize to whoever sells the most items per transaction on average," says Segel. "When the contest is over, evaluate whether you have some ineffective salespeople who are hurting your business. If you do, now's the time to let them go."
Take advantage of the "cheap high" phenomenon. When there is an abundance of bad news, we humans crave a pick-me-up. These pick-me-ups usually come in the form of a cheap high—something that can be obtained quickly and provides instant gratification. "The trick for you as a spa owner is making sure the products in your store that fall into the 'cheap high' category are easy for clients to find," says Segel. "Put them at the front of the store so they are the first things your customers run into. Include products that are unique to your store, so that the next time a customer wants to achieve a cheap high through a retail fix, they come straight to your store."
Push promotional and off-price items and use bundling. In a down economy, people want to feel like they are getting the absolute most for their money. A down economy is a great time to stock up on promotional goods and off-price merchandise. Promotional goods are products the manufacturer makes specifically to be sold at a reduced price. Off-price merchandise is merchandise that the manufacturer is willing to mark down in order to get rid of it. Your manufacturers are probably struggling a little right now too, so they should have these kinds of merchandise in abundance. Bundling makes such goods even more appealing to customers, says Segel.
Shop, shop, shop. If there is a single flaw that exists with all retailers, it's their lack of shopping. It might be ironic, but the nature of being a retail business owner means you don't have the time to actually go shopping yourself. The reality is you should be shopping in order to make sure your own business is up to snuff. "You need to shop your own store, your competitors' stores, and websites so that you know where to start when you are looking to make changes," says Segel. "Shop different types of retailers, not just retailers that sell what you sell. Shop supermarkets, convenience stores, jewelry stores, sporting goods stores, and any other sharp retailer you can learn from. Notice how these stores display, what colors they use, the types of signs in view, the numbers of employees, and how they market and advertise. Talk to the owners to see how their business is holding up and what marketing efforts they are having success with."
The bottom line? For most retailers, as always, the future is what we make it. Yes, some of the weaker links may break, but those of us who are selling what people want and need—and who adhere faithfully to proven retail principles—will weather this economic storm. "These aren't the end times for retail business owners," says Segel. "As an owner, you simply need to block out all that bad news you're hearing and focus on your store and what you can do to keep people coming in. It's a time for your store to become stronger, not weaker. And if you take the proper steps, you will do just that."