Denise Knapp, owner of a brick & Mortar store in Ashville, N.C. as well as the largest prom dress retail buying group in the country, Top 10 Prom, shared more than 25 years of experience on the growing internet influence and the critical importance of strong, symbiotic retailer-vendor relationships.
Samantha Jones owner of two Birmingham, Ala., boutiques as well as popular social networking site, abetterretailer.com, offered insight into both the in-store and the online aspects of growing business.
Julie Routenberg’s experience owning high-end young designer specialty stores in the Atlanta area for more than 30 years provides a basis to offer advice on weathering almost any economic storm.
More than 25 retailers joined a lively discussion on maintaining budgets, watching cash flow and controlling inventory, adding personal anecdotes of what’s worked – and not – for their stores. Among the takeaways…
- Be a buyer, not a shopper. Managing a retail store is about more than finding wonderful things to fill your store. Overbuying is a common mistake that can affect all other aspects of your business. Sometimes less really is more. Don’t just buy the right things – buy the right amount.
- Know and understand your fixed costs. To manage cash flow, you have to know exactly how much money is going out the door every month, no matter how much you bring in. For example, based on standards such as rent being be no more than 8 percent, payroll approximately 10 percent, etc., you must account for every aspect of your fixed costs before planning your product purchases.
- Plan your open-to-buy budget based on real needs. Buy what you know will sell to avoid having to do huge markdowns to move inventory. Balance your budget with what you need to buy for coming seasons and your immediates. Don’t buy too far out; it’s too easy to forget and overbuy.
- Don’t train customers to wait for a sale. Instead, keep them shopping all year with cost-effective events and promotions such as trunk shows and discount with purchase offers such as “buy any dress and get 25 percent off a handbag.” Use a staple product as a cornerstone, then build around that to drive add-on sales. For example, drive sale traffic by offering a rare discount on a perennial favorite item. Talk to your best suppliers about samples and consignments to do special store events. When working with vendors, no matter how trusted, always get the terms in writing to avoid potential disagreements down the road.
- Retail consultants can be extremely helpful to keep you on track, but a wealth of resources is available online. No matter how busy you are – and you are busy – set aside time to really manage your business so you aren’t caught off guard. Use point-of-sale programs tailored to your size store so you get what you really need from them.
Remember that you’re in control of your business. Use your leverage with vendors and capitalize on your relationships with customers. Management doesn’t have to be overwhelming if you deal with one component at a time while keeping an eye on the complete picture.