Equally important in a rough economic environment is that retailers should also be savvy cost cutters.
Batt advises being a student of sales reports. Know what is moving and let go of slow inventory through markdowns. Quickly letting go of slow inventory is one effective way of staying profitable.
A critical analysis of retail space can lead to tremendous cost advantages. If you can execute your business model using less floor space, work with your landlord to concentrate square footage, recommends Batt.
Schaar reminds retailers to remember “ROI over ego.” He suggests that all marketing and advertising efforts remain measurable so that advertising dollars are used as efficiently as possible. In an effort to keep costs low, he also advises retailers to re-shop vendors for the most competitive offers as well as identify opportunities to increase energy efficiency, thereby lowering bills.
“Ask your local utility [agency] to perform energy audits on your business to identify opportunities for more efficient lighting and HVAC usage,” says Schaar. “Rebates are frequently available for work and equipment. We changed our MR16 light bulbs from 50W to 35W and saved big last year.”
Finally, retailers also urge that businesses examine their number of employees and whether every position is necessary. “Everyone in the company needs to be busy. If you have people who aren’t busy, then you have too much staff. No one likes to be overworked. But stimulation is good, and people like to be engaged so that their days go by quickly,” says Costello. He also advises that managers stick to their best sellers. “You have to work with what you can control. You can control your payroll and what you’re buying week to week.”
Rather than sitting on your loins and reminiscing about the good old days, focus on the “positive side of these tough times,” says Batt. “This difficult economy promotes a spirit [of trying] harder. It’s like any team sport: Don’t lose sight of the goal. And the fight to get there is so gratifying when you realize that the struggle makes the team a unified force. I can’t express how much I count on our people. Customers are gained one at a time. Dazzle them with service. Let them tell someone else how special their experience was at your store.”
Leah Genuario is a Hawthorne, NJ-based freelance writer. She is the former editor of Beauty Packaging.
[Photo caption: Ricky’s NYC has a reputation for providing hip, sometimes hard-to-find items.]
[Image: Courtesy of Ricky’s NYC]