Advice to Make it in the Retail Industry
This article originally appeared in the Retail Capital SME Toolkit E-book.
The retail sector is notoriously difficult, with a scrummage of competitors all wanting a piece of the action. In this sector, a clear and definable vision is arguably more important than in any other.
Your clients need to know who you are, what you stand for, and what makes your product and offering better than the rest.
1. Location and branding
There are retail factors under your control and those beyond your control, and to know which of these you can influence through proper strategic planning will help you sell products, but also keep a lid on your blood pressure. You can control store location and the look and feel of your store, but seasonal retail trends is something you can plan for, but not manage directly.
The pricing of your product is a core capability of any SME owner in the retail space. Start by establishing key value categories (KVCs) and key value items (KVIs). As explained in Price Intelligently, pricing is the exchange rate you put on everything in your business, and everything else works to justify the rate.
What are your competitors doing? Evaluate what’s happening in the market around you and see if you can take anything from your competitors, be it adjusting your pricing models or the look and feel of your store – this includes the online space.
Managing your merchandise using best industry practices will save your bottom line. Be strategic about the products you offer by considering the shopping behaviour of clients. Shopping trends differ for each type of merchandise, which includes convenience goods, impulse goods, shopping products and specialty goods. There’s a fine balance in stocking each of these products.
Know your inventory, and learn the various inventory management techniques, which are customisable to each business.
These include dropshipping, first-in, first-out, and demand forecasting. At this stage, knowing your KVCs and KVIs is very important.