Like many people, Sally Johnson* spent years dreaming about doing what she loved for a living and being her own boss. Finally, she was able to make her dream a reality by opening her own craft and hobby store. Between getting her store open and ordering inventory, hiring staff and keeping the books up-to-date, attending trade shows, creating educational opportunities and more, Sally soon found herself overwhelmed and in over her head. Quickly facing the reality that running her own store wasn't exactly what she dreamed it would be, Sally closed her doors just 16 months after opening them.
While many facets go into keeping a business strong, Sally made three large--and, unfortunately, common--mistakes that greatly factored into her store closing. Had she followed the solid advice from successful retailers and business professionals in this article, she may have avoided these mistakes and still be in business today. Read on for the helpful input of real-life retail experts on how to avoid the mistakes
Mistake #1: Sally moved forward without a plan.
Take time to set a long-term, overarching strategy/business plan to use as a guiding point for your business through strong and lean sales times.
Spending your days surrounded by items and experiences that you love sounds wonderful. But keeping your store profitable isn't always as easy as you hoped or dreamed it would be.
"No one opens their store planning to run it by the seat of their pants, but this is often exactly what happens," explains Cathy Wagner of RETAILMavens. Wagner, who's consulted with hundreds of retailers, believes that many are trying to get by in business by "doing the best they can."
An overall strategy will include planning for, and lessening the effects of, slower sales times, giving you options to keep your momentum--and time to gain momentum when your business hits an all-time low," shares Christian Kratsas, digital marketing manager from SnapRetail. "It's up to you to evolve with your customers' purchase decisions and habits."
To write up your business plan, consult with a business consultant or visit the local small-business group center near you.
Mistake #2: Sally didn't manage her inventory well.
"As a rule of thumb," says "The Retail Doctor" Bob Phibbs, "keep your opinion separate from what you believe will sell." Objective standards for purchasing can give you a good indication of what products will sell. Some components of objective standards include:
Mistake #3: Sally didn't display her merchandise effectively.
"Having great products alone won't keep your doors open," says David Nawrocki of Retail Studio Effect. "You need to make sense of your products within your store environment so that your customers understand them and, ultimately, want to buy them. Presentation of products is key."
Retail experts Rich Kizer and Georganne Bender say that it's common for retailers to get so involved in running a business that they miss opportunities to present products in ways that pique customers' interests. Look at your store through your customers' eyes," they advise.
Note what a customer sees in the first 10 seconds of walking in the door, and notice which displays seem more effective at drawing sales, as well as which ones are least effective. Then adjust as needed to ensure your product displays are eye-catching and make customers stop to check them out further.
By following these useful tips from successful retail experts, you can avoid the pitfalls Sally Johnson encountered to make your business launch successfully and be successful for a long time.
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