Why Loss Leaders Work So Well To Drive Regular Retail Store Sales

Loss leaders, items sold at a huge discount to increase traffic into your retail store, work to drive regular sales. Here’s how.

Loss leader pricing:

Why Loss Leaders Work So Well To Drive Regular Retail Store SalesLoss leader pricing is a strategy used in retail stores where they price and advertise an item at or well below cost in order to attract buyers into their store. This is done in the hopes of increasing traffic and that customers will purchase regular priced items at the same time. Increased impulse buys are always a good thing.

Think about it this way, you see an ad for a Bluetooth headset you need at a retail store where you usually don’t shop, and the price is amazingly low. So you go and while you’re there, you realize you need ink for your printer and an SD card for your camera. The ink and SD card are at a price that is higher than you’d pay where you usually shop but you think “well I’m here already” or “with what I saved on the Bluetooth it’s worth it” and buy it there instead of waiting.

Loss leader is the “hook”:

Consumers are always looking for the lowest priced products, but they also are so used to convenience, that store hopping to get the lowest price on everything they buy is inconvenient, or with the price of gas cost prohibitive. So the loss leader item is the “hook” that gets them in your store. The loss in profit on that item is made up for by the regular or higher price items they buy when in the retail store along with the discounted item. It’s also a good strategy to use on relationship business sales.

If your business depends on continued business, or the products you sell are not consumables that need to be replaced with regularity, consider that even if you take a loss on the first sale, establishing the relationship with the customer at the time of the first sale will bring them back and then you can make up the difference on future sales.

Some cautions:

Some product manufacturers will not allow you to use loss leader pricing, and in some states it’s illegal to sell below cost. If you are unsure, consult with a local attorney or your state’s business division. Also, when advertising, be sure to add “while supplies last” to avoid being held to the price past the advertisement or having to give rain checks.

Retail Store Operations – 5 Tips To Stop Shoplifting

Tis the season… for shoplifting. All retail store operations are in the same boat, and it’s an all year problem. There are ways to stop shoplifting. Here are a few.

Keep valuables close to registers

First, place items that are the most valuable close to the registers. Since Retail Store Operations - 5 Tips To Stop Shopliftingthat’s the place in the store where you and your staff spend the most time, it makes sense to keep the most valuable items there where you can keep an eye on them. At the very least, keeping items in clear view, meaning don’t put them in a corner or an area of the store where cover is provided will help stop shoplifting in your store.

Train your employees

Next, train your employees about what to look for when spotting shoplifters. It has to be said, and for legal reasons, DO NOT TELL THEM TO LOOK AT RACE OR NATIONALITY. That can get you in real hot water. Instead look at common shoplifting habits, like being nervous, not making eye contact, wandering around aisles, looking around constantly, leaving the store and returning again, lingering in certain locations and watching employees or looking up at surveillance cameras.

Keep the store clean and organized

Here’s another reason to give your employees to keep the store clean and organized: loss prevention. Cluttered, disorganized stores provide a much easier place to shoplift. It also makes it harder to see when something has been stolen. Also encourage your employees to walk around our retail store often and all over the place. Also be sure to have a store that is adequately staffed.

Communications

Keep the lines of communication open between staff and other store owners. Talk with other retail store owners about any suspicious behaviors they might have witnessed. Have your employees keep logs of suspicious behaviors to share with each other. Again, caution them about how they describe people. Make the logs something that helps, not something that comes back to bite you in the butt. Follow these ideas to stop shoplifting in your retail store.

Retail Store Staffing – How To Get Good People

Hiring staff may not seem like a big deal, just find someone willing to fill a spot, right? Well, not so fast. Hiring a bad employee is worse than not hiring anyone at all. Finding good staff for your retail store is important and you need to know what to do to get good people.

Less is more

Retail Store Staffing - How To Get Good PeopleSo what should you be looking for? A few things, actually. First, don’t hire a lot of people. Instead hire a few people willing to work more shifts. Yes, more may give you more flexibility of hours, but fewer people who have more hours will have a bigger stake in the success of your retail store.

Use social media

Next, look for someone who “plays well with others.” How? Do a simple social media search after you get their application but before any interview. How do they deal with people online? Then during the interview ask them questions that will help you see how they deal with people offline. You’re looking for evidence that they are engaged in the real world with other human beings, so think of questions that will uncover this.

Past behavior as an indicator

People can and do change, but past behavior is usually a good indication of future behavior. During the interview asking questions about future plans aren’t a good gauge of how well they will work for you. Ask questions that probe their past, such as tell me about a time when you went out of your way for a customer. If they can’t do that, or if their answer doesn’t line up with your expectations, then you may not want to consider this person for your retail store.

“Sell” your retail store

You need to “sell” on why your retail store business is a great place to work. During an interview talk about your business, its history, what kind of environment you have created for your customers, what great customer service looks like to you, and about your management style. If this person is going to be a good fit, they need to feel like they are a good fit as well.

Find the negative

Get them to tell you something negative about how they have dealt with customers. Great employees will be up front about it and tell you how they fixed the problem, bad ones will deny they ever had a problem.

Check references

Lastly, don’t offer the job on the spot. Take the time to check their references and work history. Have them call you back the next day to get an answer. If they want the job, they’ll call. If not, they wouldn’t have been a good, long term employee.

Want to learn more about retail staffing solutions? Check out our Event and Mobile Sales services.

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Mystery Shopping Myths – Why Go With A Reputable Company

Mystery shopping services can be a great way to see what goes on in your retail store when you aren’t around. But beware, because the industry is also fraught with scams. So be sure when you are looking for a mystery shopper provider, to use a reputable company.

Mystery Shopping Myths - Why Go With A Reputable CompanyThe mystery shopping industry has been plagued with scams. It has given it a black eye. Many legitimate businesses shy away from using these services because there are so many scams out there. But there is a way to tell a legitimate company from a scam. First, start with the Mystery Shopping Providers Association (MSPA) website at www.mysteryshop.org for member companies. The companies affiliated with MSPA are legitimate businesses and a good place to start. But, don’t stop there.

When you have settled on a company or a few, check them out further. Start with the Better Business Bureau. Then go to your state corporate database or attorney general’s office. See if there have been complaints lodged with either and that their corporate charter is in good standing. Check out other places like Yelp for recommendations. Google the company and see what comes up about them.

Another tip is to start with a market research company. Many of them provide this service for clients. Steer clear of companies that charge shoppers a fee to work for them. This is the first red flag that they are a scam. Also keep an eye out for things like companies with no website or can’t be Googled. If the company doesn’t have a corporate email and uses a free service like gmail, yahoo, Hotmail, etc. for their company email addresses. Most legitimate companies can afford the roughly $100 per year that it costs to acquire and maintain a domain and related company email account. If they have a website, look for exaggerated hype about what they can do for their shoppers and for their retail clients.

Mystery shoppers are a great way to evaluate your business, but be cautious about where you find them! Scams abound so don’t get burned.

Has Amazon Killed the Retail Store?

Amazon is the biggest online retail store. They sell everything you could think of that is legal to sell, and what they don’t sell, they provide a venue for private sellers. So has this killed the brick and mortar retail store?

Has Amazon Killed the Retail Store?Yes and no. Many brick and mortar retailers have been seriously hurt or put under by Amazon. Let’s face it, for some the ability to shop from their home and not schlep out into a store is a great thing. But beyond that, Amazon provides a lot of other services that a brick and mortar retailer hasn’t, and/or can’t. Comparison shopping is available in any store, but Amazon provides reviews from people who have bought and used the item. This can be invaluable in deciding which one to buy. Being as big as they are they also have the ability to leverage that for lower purchasing cost, so that means lower costs for the consumer. That is a big problem that most small retail stores can’t overcome. Some argue that it’s made up for in shipping costs, but sometimes the difference is big enough that shipping isn’t an issue.

The best bet for brick and mortar retailers is to realize that there are some ways they can’t compete with Amazon, but there are others where Amazon can’t compete with them. When was the last time anyone got personal, face to face assistance from Amazon? Or even talked with someone on the phone with them to deal with a customer service issue? That is the best place where the store can outdo the online retailer. Don’t underestimate it. Excellent customer service can inspire a loyalty that will override price considerations.

Amazon does have some areas where they have killed it over brick and mortar stores, but since there is still a lot of healthy retailers out there, they haven’t put them all out of business yet!

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Retail Store Downsizing – Fad or Fixture?

Retail store downsizing is a new trend in retail. But is it a fad, or will it become a fixture? Time will tell, but smaller may be the way to go.

Retail Store Downsizing - Fad or Fixture?Having your retail store go smaller is a good decision. Many businesses are finding the benefit to small, enough that it may not be just a fad, but a longstanding business decision. There are a few reasons, all of which will lead to a more profitable business going forward.

Commercial real estate for your retail store is expensive. Whether you purchase your store or lease it, you will have the overhead of monthly payments. If you purchase your space, you will pay per square foot for the purchase, and also for the real estate taxes. If you lease the space, you will pay per square foot for the rental amount. In both these situations small means lower payments. Small store space also means lower utilities. Lower heating and air conditioning costs. Lower electricity costs for lights and electronics. In both areas, utilities and real estate, you will save a substantial amount of money.

Downsizing means you will require less staff. This can be a benefit in two ways. First, you can be choosy and have the best, most qualified staff on hand. This means better customer service and happier customers. That also means more business as you get happy customer referrals. But it will also save you a substantial sum on payroll expenses. Not just actual salaries paid, either. The savings extends to your taxes. Payroll taxes are expensive. Benefits for your employees are expensive too. Not having as many employees on the payroll will save a lot.

So retail store downsizing fad or fixture means you can still take advantage of big brand marketing. Your products will attract customers, no matter if your space is smaller. Take advantage of this in your marketing and your displays. Provide excellent service to bolster those brands.

Going small may not be a fad, but even if it is, take advantage of the savings now and build your business.

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Finding Points of Failure in Your Retail Store – Mystery Shopping

Mystery shopping is a great way to find points of failure in your retail store. Knowledge is power and in this case knowledge will improve your bottom line.

Finding Points of Failure in Your Retail tore - Mystery ShoppingIf someone went into your store right now, what would they find? You hope they would find well trained staff that greet warmly every customer, have exceptional product knowledge, great upselling skills, and know and follow store policy inside and out. That’s what you want to find, but is it reality? Mystery shopping is really the only way to find that out.

So, how often do sales walk out the door of your store? You don’t know, but you have a suspicion they do. So, do you have weeks to figure out how to stop those lost sales? Of course not, that would cost you even more. You need to know, specifically, what needs improving. Finding those points of failure should be your priority.

So what are those points of failure? If your staff doesn’t greet every customer warmly when they come into your store, that’s a point of failure. If your staff falters in product knowledge, that’s a point of failure. If your staff doesn’t offer or up sell accessories, that’s a point of failure. If your store isn’t clean and well cared for, that’s a point of failure. If your staff isn’t dressed appropriately, that’s a point of failure.

Any of these things can and do turn off customers. Not being greeted or even acknowledged when they come in the store, in a warm manner not one that makes them feel “salesed” is the first thing that will send them back out the door. Not buying a phone because the sales person didn’t know enough about it to help them decide. Or worse, buying it and returning it because it wasn’t what they wanted or needed.

Mystery shopping is the perfect way to find out what your points of failure are. Use that knowledge to improve your bottom line.

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Culture Based Sales People – Should You Use Them?

Culture based sales people are a plus for your retail store. America is an amalgamation of many cultures, but these days America is less of a melting pot and more about individual cultures. So, you’re thinking, what does that have to do with my retail store? A lot. Being sensitive to other cultures can make or break a sale. So having sales people who are familiar with the cultures of the people who frequent your store is vital to your business.

Culture Based Sales People - Should You Use Them?Making customers comfortable is key when selling. If those customers come from a different culture, knowing some of their practices and/or understanding or speaking their native language will set them at ease. The last thing you want as a salesperson is to lose the sale because your information was lost in the translation or because you did something to offend.

Whether they are Greek, African American, Hispanic, Muslim or Asian, there may be something that you do that will not sit well if you aren’t aware of cultural proclivities. Having staff that is aware of the predominant cultures of the neighborhood can help keep sales from being lost.

The solution? If you know that your retail store is in a neighborhood where the majority of the people are of a specific culture, it is a good idea to be sure there is someone on staff who knows about their culture and can speak their language. Not to take all the sales, but to help if there is a sticking point. What if your customer is from a culture where men dealing with women, shaking their hands, etc. is wrong? The solution is that there are men on staff, or the women in your employ are aware of the stigma of physical contact, or of the way they should comport themselves around men of that culture.

It may be a lot to ask, but by being sensitive to their culture, you will save the sale. You may also find that you learn who on your staff is able to be more flexible and less easily offended.

Culture is a big part of America today. Ignore it at your own peril. Having culture based sales people can make a big difference in your retail store business.

Why Customer Sales Analysis is so Important to Retail Sales

Customer sales analysis can give you answers to the questions you have about your retail store and sales. Here’s some important info.

You know your business better than anyone… or do you? Are you 100% sure that what you want to be happening at your store is happening when you aren’t there? Are you over or under staffing? There is a way to be sure.

Why Customer Sales Analysis is so Important to Retail SalesThere are many aspects to running your retail store or, as you grow, stores. One is being sure you have the best practices in place. This includes your retail store procedures for dealing with customers, keeping the store in tip top shape, staying on top of training.

Without good, solid best practices in place, things will fall apart. Your retail sales will be luck of the draw and meeting those needs and goals will be haphazard at best. Customer sales analysis will help keep track of whether your best practices are being used.

Another aspect is having the best staff, and the right number available and on the floor. That means knowing how store traffic flows. When are peak times? When are slow times? You want more at peak times so that customers aren’t waiting impatiently to be helped, but fewer at slow times so your payroll costs don’t decimate your budget. In your retail store knowing the customer flow, how it is affected seasonally and adjusting accordingly is very important. Again this is where customer sales analysis comes in tracking traffic flow, slow times and staff. All of these things will affect your retail sales bottom line.

How does your staff act when you aren’t there? Is it a slack off free for all? Do they act the same as if you are still there? How can you know? Customer sales analysis will tell you all of these. You can get all kinds of companies who offer it, but only Retail Business Development will give you the information you need specifically for your business: retail wireless sales. RBD specializes in Wireless Retail, and can give you reports specifically for the carrier or carriers you represent and for your area. You can’t get any better than that! For more information visit: http://myvirtualdm.com


 

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