Buyers have cut back, sure. But (with a few exceptions, perhaps) they haven’t gone totally AWOL. “Shoppers are out there — you just have to attract them to your store,” says retail expert Rick Segel, author of newly-published Retail Business Kit for Dummies (2nd edition). Segel suggests these retail rules that work well in a recession.
1. Soup up your signage: Retail signage is one of the least appreciated but most effective forms of brand building. It sells more goods than any other tool, and it can be a real difference-maker in a recession. “The key is knowing what types of signs to use, when to use them and how many are too many or too few,” says Segel. Survey customers about your signs. Ask if they recall what your signs look like, or if a sign brought them in, and why.
2. Pump vendors for info: If you run a retail biz, chances are you have few chances to get out and about. Let vendors be your eyes and ears. They visit other stores constantly. Ask them what stores like yours are doing; if they’ve seen any unique marketing efforts or hot products you aren’t offering.
3. Tap the “cheap high”: In tough times, we humans crave quick pick-me-ups —usually something that offers instant gratification. For some people that might mean buying a new purse; for others it’s a new CD, DVD or night at the local pub. “Make sure the products in your store that fall into this category are easy to find,” says Segel.
4. Overhaul inventory: Inventory is your biggest risk. The flow of merchandise in and out of sets success. Evaluate your inventory at least every other week in good of times – weekly when things are slow. “You need to know what you have that isn’t selling, and you need to know if you’ve overbought a certain item,” says Segel. Look at dollars spent — not just units.
5. Energize sales staff with a units-per-transaction (UPT) contest. UPT shows how many “units” (items) are sold per transaction. A UPT contest helps pinpoint your best salespeople, and also lets you get a little extra out of everyone. “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.”
6. Sell “wants” over “needs.” People find a way to buy what they need — gas, pet food, toilet paper. It’s the things they want that they ax. Focus more on pushing non-essentials. If you’re having a sale, don’t discount “need” items. You want people paying full price for those. Instead, put “want” items on sale so customers are tempted to purchase a couple of those when they are headed to your register with their “need” items.
7. Tune into your customers: Be sure you are providing customers with exactly what they want, when they want it. Don’t guess; ask them! Do a survey. Let them tell you what items they’ll make a sacrifice to buy even when they are cutting back.