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In a highly competitive industry, retailers need to remain up-to-date. A retail business won’t thrive unless key areas are met. From making sure you have the right products to a great social media presence, this checklist has it covered. 1. Check you are offering the right productsWhether your retail business focuses on one primary product group, or sells a variety of products make sure what you’re selling is relevant for your market. Here are some ways to do this:
Top tip: Make the most of social mediaSocial media has progressed quickly, and that’s because platforms like Facebook, Pinterest and Instagram are effective and popular. Some of the top brands in Australia use social media as an integral part of their digital strategy. Marketing Eye has a report on the top 10 retail brands, opens in new window in Australia that lead on social media performance. 2. Check your business modelSell where there’s a marketRetailers are increasingly selling their products online to widen their distribution channel and to have a presence where there’s a market. Even if you can’t match overseas online prices, target those customers that will pay a premium to buy through an Australian based business. If you do sell online, invest in a responsive website, a great end to end user experience and have a planned online campaign to generate awareness. NAB’s eCommerce Merchant Account is a good option for businesses that sell online. Always keep an eye out for new marketsOn a local level, if your store is doing well in your current location, research the market in a different region. Document what makes your location work, then target similar areas with similar customers. Is there an obvious opportunity to open new stores? You might also consider entering the export market and selling your product overseas if you’re able to source locally made Australian products. NAB’s International and Foreign Exchange option offers assistance in foreign exchange and trade finance. Top tip: Do your researchWith the current shift from bricks-and-mortar to online stores, IBISWorld’s report about online shopping in Australia , opens in new windowprovides key industry analysis and statistics. It also offers insights on market size, industry trends and market share. It shows how online retailing has changed the face of Australian retail, with a dramatic growth over the past five years. As a retailer, these are facts you shouldn’t ignore. 3. Check your marketingKnow your current strategy – what is it and is it working?Successful retailers continually review their marketing strategy. Keep up with how people are making purchase decisions, their sensitivity to pricing, and how they find out about you. You can do this through digital marketing, social media or direct marketing. It’s increasingly important to have a great digital presence, such as a responsive website to inform and educate customers about what you do. A digital presence can help raise the awareness of your business. You should consider Google Adwords marketing, opens in new window, an up-to-date Facebook page for your business, opens in new window or using Facebook call back request forms, opens in new window to generate leads. Check out your competitionIf they’re successful, what are they doing and what can you learn from them? The retail business is highly competitive. If you see your competition doing something that’s effective and successful, try to implement it yourself. But it’s important to see if you can improve on it to enhance your competitive edge. Learn all you can about your customersAdvertising works when you know which customers you’re targeting, rather than a scattergun approach. Determine your ideal customer and what their needs are, then make sure what you offer is designed to address their need. Review seasonal trendsCan seasonal issues affect your business, like school terms and holidays? Coordinate your promotion and product purchases with events that are planned during the year. Develop a calendar that captures any excuse to get in front of customers, from sports events, local celebrations, to public holidays. Work with local retailers to get more people to your areaJust because you have competitors doesn’t mean you can’t work with them to attract more people to your location. Or you can work with another business to gain more customers together. Collect feedback and make changes with what you learnEither from social media or from your customers, if you get great feedback, use the comments as testimonials on your website. If you’re seeing complaints, use them to turn a negative customer experience into a positive one. And make sure you have processes, and a person, in place to handle feedback early and effectively. Top tip: The growth of social media marketingConnecting with your customers– is essential. And nothing is growing faster in communication than social media. According to Web Chameleon’s review of what Australian people and businesses are doing with social media, opens in new window, 64% follow businesses on social media. 4. Check your systemsEnsure your ordering system is efficientIf you’re purchasing a range of different products for your inventory, it’s important your system is effective and efficient. It’s also important that it’s easily understood by your employees so you can manage your cash flow and stock levels. Check inventory for defects and qualityAlways document the inventory you receive, and check for defects or incorrect delivery. If you are constantly returning product, then it’s time to search for new suppliers. Use inventory softwareEven small retail businesses should automate between the till and what’s being sold, and your inventory levels and what you have left in stock. It will allow you to use ‘just in time’ ordering to keep your inventory to a minimum without running out. Offer your customers ways to payCustomers want the latest ways to pay, with the most up-to-date technology. Online and mobile payments mean that you aren’t spending time invoicing, and chasing up late payers. NAB’s Business Package has options for you to do this and includes options such as:
Use accounting software to keep everything up to date and compliantA good accounting system is crucial for a retail business and comes in handy at tax time. You can monitor cash flow, transactions and inventory, develop a customer database, and keep up to date with your bills and payroll. A cloud-based accounting system offers increased security, as well to the ability to check your financial data in real time. Most can be used on your smartphone as well, making it easier to update your records. Once you have accounting software you can integrate your accounting package with your NAB account to make bank reconciliation fast and easy. There’s also a number of retail specific software add on products that integrate with your accounting software. Develop a customer sales systemProvide training to employees to keep up-to-date with the products you’re selling, and to offer an outstanding customer experience. One of the main differentiators for a retailer is customer service, in a world where the customer can buy most products online. Create a system to go that extra step, know your customers by name, be involved in the local community and anticipate customer needs. Check you’re not overstockedIf you find yourself with products that aren’t selling, and running out of those that are, you need a better inventory system. Invest in inventory management software to see on a daily basis what is happening. Top tip: The importance of retail workflow and operational processesUnderstanding best practice when it comes to the workflow of retail operational processes is essential. The Small Business Chronicle, opens in new window has some tips on the basics, such as purchasing, inventory, customer service and accounting. 5. Check your capacityAre you getting more sales than you can handle?If your business has queues outside the door, and you can’t keep up, you need to find a solution. Larger premises, more staff, longer opening hours, more cash registers, or mobile payments to prevent queuing are all options. Regularly check with staff about the amount of work they have, to prevent errors within the business or providing a less than ideal customer experience. Recalculate your break-even pointIf you find you’re flat out but not making profit, it’s time to review your break-even point. One way of addressing this is by lowering your overheads, raising your prices, and focusing on selling higher margin products. You’ll find you need to sell less to make the same money. Top tip: Address your cash flowIncreasing your cash flow to grow your business can be as easy as using NAB's Business Overdraft option. It links to your NAB Business Everyday Account, and has no set repayment schedule, so you can pay when it suits your cash flow. You could also consider a NAB Business Loan, or if it's only a short-term cash injection that you need, a NAB QuickBiz Loan. 6. Check your KPIsCompare your actual sales against your sales forecastsThis is to make sure that your forecasts are on track, so that you can use them to continue to predict sales and make decisions based on them. If your sales forecasts are inaccurate, it’s time to review how you predict sales and costs so they’re more realistic. Check your costs aren’t exceeding your budgetsKeep an eye on things like fixed costs, to make sure they’re not going over budget. Review your overheads – rent, power, internet, etc. – and if they’re more than you expect, look at ways to reduce them. For instance, if your store is in a shopping mall, chances are you’re paying prime commercial rent. Do your sales justify it or would you be better in a cheaper location? Make sure you’re matching or exceeding your industry gross marginsEvery retail industry has ‘accepted’ mark-ups for products. If you’re not achieving industry norms, look at ways you can increase your margins. Increasing price, targeting less price sensitive customers, widening your product range to cover better margin product will all help. Review your sales data, and take action using these indicators
Top tip: Top 10 KPIs in retailThere are lots of KPIs that can affect retail businesses. Some stand out more than others in terms of the competitive advantage they provide, as well as helping to monitor sales success and performance. Gain Insights has a guide to the Top 10 KPIs in retail. 7. Stay up-to-dateBe social media savvySuccessful retailers are finding more ways to be in contact and connect with customers. Keep in contact with your customers - from updating what the business is doing on Facebook, to blogging on popular retail topics, to posting photos of new product releases on Instagram. Build a personalised experienceBy using your sales data and customer contact information, build a one to one personal relationship with your customer. It’s not only good business for you, but customers appreciate you understanding and anticipating their needs. Use customer sales softwareBuild a profile of your customers, enrol them to receive your e-newsletter, develop a customer loyalty scheme, or start rewarding them based on their purchases. Make buying from you a rewarding experience. Be aware of customer trendsResearch what’s happening to the demographics of your customers; are they part of the baby boom market (born 1946-1964) who are all approaching retirement? Or are they younger teens? Or parents with children under ten? Each will require you to be aware of what they want, how they want it, and how they want you to sell to them. Thinking about starting a business? We have tips, tools and solutions to back you. Request a call back or call us on 13 10 12. Other business momentsRelated products and servicesGet in touchImportant informationApologies but the Important Information section you are trying to view is not displaying properly at the moment. Please refresh the page or try again later. The information contained in this article is correct as of July 2018 and is intended to be of a general nature only. It has been prepared without taking into account any person’s objectives, financial situation or needs. Before acting on this information, NAB recommends that you consider whether it is appropriate for your circumstances. NAB recommends that you seek independent legal, financial, and taxation advice before acting on any information in this article. Which type of retailer carries a narrow product line with deep assortments within those lines?-Specialty stores carry narrow product lines with deep assortments within those lines. -Convenience stores are small stores that carry a limited line of high-turnover convenience goods.
Which of the following is part of a retailers retail mix?Once the strategic retail plan is in place, retailers devise the retail mix which includes product, price, place, promotion, personnel, and presentation.
Which retailer would be least dependent on traffic flow?(Destination stores rely least on traffic flow as they have enough draw to bring customers to wherever they are located.)
Which of the following is typically the last step in site selection?Which of the following is typically the last step in site selection? Match characteristics of present trade area with potential sites.
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