10 May How to thrive as an independant retail store
The Intelligent Retail® team recently spent a week on the road meeting with owners of independent retail businesses as part of the upcoming launch of our Business Intelligence Reporting System (BI). We were looking for insights as to why some in the retail industry are excelling, while some retail businesses are feeling the pressure of tighter spending within their geographic community.
It was a fascinating week with much of the discussion about to be or not to be an online retailer and offer an eCommerce retail presence.
A retailer of outdoor equipment we spoke to in Adelaide are making 5 times their physical store revenue through their eCommerce presence – a real success story!
We also met with a fashion store in Melbourne who had just opened their 3rd brick and mortar store with plans to open 2 more. They have no eCommerce platform and no plans for one.
Here are two very successful independent retailers on opposite ends of the spectrum in their approach to making their businesses successful. In many ways, both are breaking the stereotype of what is generally perceived as the way to ‘make it’ in retail.
Even with their different approaches there are a very prominent themes which enabled both retailers to be successful while others are struggling. Not to sound cliché but both the retail owners spend a certain amount of time every week to work ON the business, rather than IN the business. Both owners also use technology and systems to understand their customers and then specifically target them.
Basically, they were both actively engaged every week in understanding the number of transactions, the size of the transactions and then building strategies for increasing both over the course of the next month. Then repeating this process to ensure continuous business growth.
The retail management systems used by the retailers we spoke to help them analyse their business data to provide insights for their next steps. These retail systems didn’t cost hundreds of thousands of dollars and in some cases not even tens of thousands of dollars. One young entrepreneur was using no more than a spreadsheet! Every successful businesses common approach was to make business decisions on current and past business intelligence.
Successful retail business owners understand the general size of their market. For instance, the fashion retailer with no eCommerce presence is limited to its geographic catchment area. This fashion retailer set about attracting customers within their area using freely available data from the Australia Bureau of Statistics (ABS). Each month they measured the number of new names collected and designed methods of communicating and building brand loyalty through Marketing. They continue to drive up the value of every transaction using this approach.
The Adelaide outdoor equipment retailer took a very similar approach but looked at how to reach their audience online. Using emails of new customers and their demographic profile, they offered targeted incentives those consumers individually.
The top 4 points to thrive in retail business?
- Take time. Every week to actively work ON your business, instead of IN
- Acquire. Gather contact details of new customers, even if you spend as little as an hour a week.
- Promote. Create meaningful, targeted marketing and promotions by using demographic information
- Learn! Ask questions and talk to your POS or retail management system provider as to how to maximise your investment to produce steady, profitable growth. They help people every day and can provide valuable insights that could make a world of difference to your retail success!
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