By Randy Snyder
Part one, last week, addressed those “pulse points” of business on a “macro level,” best defined at the broad brush across the board points as at pertains to a group of stores. Part two, will address those “pulse points” at the individual outlet level and could apply to a single outlet business!
As we write for the Salesheads blog, please remember that there are points that can be addressed at the ownership or management level along with things to be digested and applied by individuals employed in the retail business or those seeking employment in the opportunistic retail genre as well! Business owners or management that seek more input in planning their business can garner direction on business structure or for a broader approach! Anyone interested in a career in retail can locatea few in the links provided!
At the individual store level, there are several key 'pulse' factors that should be measured to determine the sales “health” of that unit. These are areas that the particular manager and staff should be aware of, accountable for and evaluated making them an expectation. Of course the tool(s) to measure these areas, the training and accountability must be in affect if the “pulse” is to be meaningful. As the saying goes, you can't manage it, if you don't measure it.!Also, you can't expect associates to execute a selling skill unless they have the knowledge to use it, hence the training of the associates. These are a few of the store “pulse” factors, I refer to.
Productivity of associates. A sound Point of Sale system should provide sales by associate, including, but not limited to, total sales, number of transactions, average amount of each transaction and separate accounting of any area important to the operation, i.e. accessory totals etc.
Items per transaction. A retail operation can realize substantial revenue gains with less customers and even less transactions, by simply concentrating on taking the “pulse” of the items per sale and increasing it by associate, or in total.
Departmental sales as a percent of sales to the total store. Taking the “pulse” of individual departments or even a total segment of buying, such as footwear, apparel, equipment etc. as a percent of total business is paramount to the health of the business. This measurement or “pulse” can surface the need to make changes, in presentation, positioning, buying and even assignment of personnel! For instance, if a given area is producing 25% of the store's business, and only 18% of future buy is in that area, it becomes obvious that shifts in future buys need to be adjusted to maintain the sales in the area!
Customer data bases are not something new, but need to be mentioned as an accepted paradigm that needs the “pulse” checked from time to time. Firstly, the method of gathering customer information needs to be efficient and consistent with the information needed to make improvements in marketing and encouraging customer loyalty! In many cases the information is gathered and sits dormant in a data base with no plan for putting the information to work. This is a fine case of “Knowledge isn't power, but applied knowledge is!” Frequent shoppers can be tracked and receive special offers. Promotional mail outs can go to all data base customers, or to a specific zip code or however the ownership choses to isolate the different “classes” in the data base.
As the saying goes,you can't manage it if you can't measure it!
In closing, these are all “vitals” that if the “pulse” is not currently incorporated into the overall health of your business, may expose “illness” or areas that need some “preventative maintenance” to make sure the illness doesn't lead to incurable “health” problems!
Many of the business systems in use in your operation, may have the ability to monitor the pulse of the areas mentioned. It may take a bit of additional programming, hard drive capacity or something else to achieve that ability but may be well worth your while.
Good luck and I hope this article is the catalyst to the implementation of new “pulse” areas to measure and ideally improve the health of your business!
Randy Snyder is a contributor to Salesheads and currently, an international retail consultant. He is a 35 year veteran of the retail industry, with experience at five different chains and has consulted with national and international specialty retailers. Feel free to contact him at firstname.lastname@example.org. You can see more of Randy's blogs on Salesheads blog and don't forget to check out Beyond for more job postings.
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