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Owners - Choose your own adventure! | Choices, choices. How do they pencil out? | Specially for Owners: Online Buying Plans

Monday, August 10, 2020

From The Co-Founders

Patricia M. Johnson & Richard F. Outcalt
Outcalt & Johnson: Retail Strategists, LLC • Retail Turnaround Experts

Now's the time to choose for yourself

Have you noticed? "Covid fatigue" has been spreading lately. It seems to be almost as contagious as the virus itself. Ugh!

And small wonder. Even as parts of the economy strive to re-open, they only remind us of how different everything is.

Major League Baseball played in stadiums of cardboard cutouts of fans. The U.S. Open Golf Tournament with no spectators. Professional basketball teams in "the bubble" at Disney World.
And some colleges preparing to resume fall classes have been described as "a cross between a seminary and a minimum-security prison."

Meanwhile, the U.S. Congress cannot agree on what should be done next. A nasty election campaign season looms. Protests are still happening in many locations.

Remember this: all these things that contribute to our Covid fatigue, what we have called the "Pandemic Trifecta of 2020" – the virus, the economic meltdown, the national protests – all of these are uncontrollables. We all are victims of all three pandemics.

But, you CAN control what you choose to do with your business going forward. Will you choose Door A, Door B or Door C?

While it may feel like there are no good choices, we believe there can be good decisions.

First, accept that "business as usual" – Door A – is not available. Don't even try to go back to that.
Next, give yourself permission to really re-imagine your business. What would it take to put the fun back into retailing for you?
And third, give just as much serious thought to getting out of the business. No shame in that, especially if it has been your choice.

Let's take a closer look at what's involved.

Door B: "Let's put the fun back in retailing!"

Which customer groups do you most want to serve? Of those at the top of your list, do you have an established following? Or is this an aspirational target market for you? (That's okay, so long as you know it.)
Which vendors do you most want to continue with? Grow with? And yes, which vendors or lines or categories are you most comfortable letting slip away?
Have any competitors gone away, creating growth opportunities for you?

Given those assumptions:

Think about your stores. Which ones are definite keepers? Which, if any, would you like to relocate? Which, if any, would you like some square footage changes?
What else might need to be re-invigorated? How about your staff? Does this new vision take better advantage of their talents and strengths? If not, how readily are people with those talents available to you? What would it take to be able to hire them?

Of course, does it "pencil out?"

Take advantage of The ROI's 3-in-1 INTEGRATED Calculator to quickly get a sense of "how much time and how much money" it would take to make your new plan happen.

Door C: "Hmm. Maybe that doesn't sound so fun after all."

Be careful; don't dismiss your newly-imagined business too quickly. Embracing those changes can seem daunting.

But, you do have to give just as much constructive thought to whether now is the time to close down your operation. (See the "Ready to Move On?" section in the OWNERS Center for more.)

Start by thinking through all three kinds of assets in your business. This goes beyond the Balance Sheet numbers. You have Other Tangible Assets and Intangible Assets, all of which have value.

Recognizing all of the assets that you have built over the years puts you in much better position to consider what's next.

There may be a buyer for your entire operation.
Or, if not, there may be ways for you to very shrewdly "part out" your business. Given all of the "going out of business" or "store closing" sales going on, this could be a productive way to go.

Of course, you also must consider what would be next for you?

It comes back to three fundamental questions retailers need to answer:

Do I have the capacity to do this? (The customers, products, systems, people, locations, etc.)
Do I have the appetite to do this? Be honest; these pandemics have taken a toll on lots of folks.
Most important, do I have the stomach to do this?

That of course is the most telling question. Do you still have the requisite "fire in the belly?"

You DO Have Choices

Again, while it may feel like there are no good choices, we believe there CAN be good decisions.

So, summon your optimism, and take control; choose your own adventure! It truly may be the opportunity of a lifetime!

Quick for Retailers to Use and Understand

Gain peace of mind. Face the future with confidence!

The ROI's online 3-in-1 INTEGRATED Calculator enables any retailer, anywhere, to quickly generate a profit plan (budget) for the year, plus an Open-to-Buy plan plus the resulting cash flow projection!

All from the same few inputs!

Here's the best part. This is a tool for Owners to do your own financial projections.

So if you don't like how your plan would turn out (for instance, you show a profit, but have a major cash flow problem), you can quickly try some "what if...?" changes. All on your own.

Especially in today's uncertain and unprecedented times, this is a remarkable tool for independent retailers. All online, 24/7. Nothing to download or install. It just works!

3-in-1 INTEGRATED Calculator

Online OTB Planning for Owners

Free Access • Webinar of the Week

The ART of buying - the taste and judgment that goes into selecting the merchandise - is the true competitive edge of most independent merchants.

But, the "SCIENCE" of buying - the number-crunching part - is often neglected. It's considered too complex, or too expensive.

Good news: those days are over!

The Retail Owners Institute® has done away with the mystery and the misery of buying plans.That tedious number-crunching can now be done online, in minutes.

That means you can focus on adding your taste and judgment where it is needed: actually selecting the merchandise.

This TOPICAL TUESDAYS Webinar of the Week, led by Pat Johnson and Dick Outcalt, Co-Founders of The ROI, will show how easy it is for you to build your own Open-to-Buys. Online, 24/7. "Automagically!"

This webinar has 3 major parts:

Review the basics of Open-to-Buy planning.
Demonstrate The ROI's remarkable online Multi-Department Open-to-Buy Calculator.
Provide the Buyer's Tally Sheet, an old-school way to keep track of your orders, especially when you are at a buying show.

In less than an hour, see how to gain control of your inventory, and focus once again on applying your taste and judgment to selecting the best merchandise for your customers.

Nothing to lose! (Except the misery, the mystery, and the lame excuses for not having an Open-to-Buy.)

Free Access • WEBINAR of the WEEK

Ready for another perspective? (It's free)

Worried about what's next, after Covid-19?
Uncertain about the best "survival strategy" for your business?
Have some ideas for how to re-invent your stores, but...?
Need to close some stores, but not sure which ones?
Or...

Yes to one or more of these?

Time to take advantage of a private Q&A Session. The Co-Founders of The ROI, Retail Strategists Pat Johnson and Dick Outcalt, are available to "talk shop" with you!

Just go here to schedule your private session. It's free! Totally confidential. And even fun!

Sharing is good!
Let others who care about retailing know about The ROI.

Forward

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The tool for these times | Old school monitoring | Specially for Owners: Online Buying Plans

Monday, August 3, 2020

From The Co-Founders

Patricia M. Johnson & Richard F. Outcalt
Outcalt & Johnson: Retail Strategists, LLC • Retail Turnaround Experts

Getting out of the "fog of uncertainty"

That's a sign of the times, isn't it?

While retailers are more accustomed than most folks to cope with change, 2020's unrelenting flexibility tests have been a challenge. Forget about five years. Retailers have to be ready for the next five months! It's back-to-school and then Holiday.

The only certainty about the next five months is that they will probably feel like the past five months. Yet you still must run a retail business. And that means you still must buy and sell merchandise.

The opportunities – and the pressures – are mounting. Your vendors are more eager than ever to meet their own sales goals. And emerging online wholesale marketplaces touting "guaranteed sales" and 60 day terms and small minimum orders seem to be multiplying, thanks to deep-pocketed investors.

Not only is there the traditional pressure from the vendors to "buy more, save more," there now are the online sales techniques: "Retailers who bought this also bought this..."

How best for retailers to take advantage of these new resources...and still have any cash?

It's all in having a plan, a buying budget. And having the confidence to stick to it.

Amidst all of the uncertainty of 2020, there is a way for retailers to do just that.

It starts with making some savvy assumptions about expected sales. Then, at The ROI, your sales assumptions can be turned into an inventory buying plan – in nanoseconds. All on your own.

A game plan, a path forward. Some semblance of clarity. What could be better?

Step 1: Make Your Sales Assumptions

First, make your assumptions about the sales you anticipate for back to school and the Holiday season. Given the on-going uncertainty of the virus, few specialty retailers will meet or exceed last year's results.

So, start by looking at last year's back-to-school and Holiday results, and dial them back for this year. 60% of 2019? 75%? Be as realistic as you can.

Step 2: Merchandise Mix of those Sales

Next, a critical step: nail down your assumptions about the MERCHANDISE MIX you will need. (For more about this, see New Dynamics of Merchandise Mix and Post-Covid-19: Five Stages of Inventory Management.) Don't be shy about your assumptions.

Purchases of "Basic" merchandise will prevail. Perhaps as much as 50% to 65% of your total sales.
The remaining 35%-50% of sales will be predominantly "expanded basic."
Expect just a small portion of your sales to be dedicated to "discretionary" items.

Step 3: Convert to Decisions

Now, turn all this into something you can use to make some decisions. Put these sales assumptions into The ROI's online Multi-Department Open-to-Buy Planner. It's easy and fast for retailers.

For this first draft, call one department Basics, and enter the expected sales. Do the same for the next two "departments," Expanded Basics and Discretionary.
Enter your best guesstimates of expected margins and turns for each category (and an estimate of how much of your inventory @cost is in each category to start.)

And that's it. Immediately, for each of these categories, you have a monthly inventory buying budget. And it happened "auto-magically!"

These OTB plans become the guardrails for you and your buyers. Within those budget parameters, you then apply your best judgment of which vendors to purchase from, and what items to select. You also will have a ready answer when a "special buy" pops up: do we have any Open-to-Buy?

This unique online "calculator" is a tool developed specially for owners. It enables you to quickly develop a game plan for your store, all on your own. Auto-magically!

And, you can update this game plan as the game unfolds. Adjust and tweak it whenever needed. All on your own. 24/7. No additional cost.

This is its time. See more about it in this week's Webinar of the Week. Take advantage and make this your time too!

Online OTB Planning for Owners

Free Access • Webinar of the Week

Review the basics of Open-to-Buy planning.
Demonstrate The ROI's remarkable online Multi-Department Open-to-Buy Calculator.
Provide the Buyer's Tally Sheet, an old-school way to keep track of your orders, especially when you are at a buying show.

Free Access • WEBINAR of the WEEK

Simple Tool for Keeping On Your Buying Plan

"Okay, I have my Open-to-Buy plan for each department. I'm off to the virtual buying show. Now, how do I keep track of my orders with all those vendors, so I can stay on plan?"

Easy! Use The ROI's Buyer's Tally Sheet!
The ROI's BUYER'S TALLY SHEET provides a quick reference for you of orders vis-a-vis departmental OTB budgets.

It lets you and your buyers easily track orders as you place them, by vendor by the month they are to be received.
And it's very low-tech; you use a pencil! No technical support required!

Go here on The ROI site to download your free pdf master copy. Then, make as many photocopies as you need to have at the ready alongside your computer.

BUYER'S TALLY SHEET

Ready for another perspective? (It's free)

Worried about what's next, after Covid-19?
Uncertain about the best "survival strategy" for your business?
Have some ideas for how to re-invent your stores, but...?
Need to close some stores, but not sure which ones?
Or...

Sharing is good!
Let others who care about retailing know about The ROI.

Forward

Get Retail Financial Know-How

From The Co-Founders

Now's the time to choose for yourself

Door B: "Let's put the fun back in retailing!"

Door C: "Hmm. Maybe that doesn't sound so fun after all."

You DO Have Choices

Quick for Retailers to Use and Understand

Gain peace of mind. Face the future with confidence!

Online OTB Planning for Owners

Free Access • Webinar of the Week

Ready for another perspective? (It's free)

From The Co-Founders

Getting out of the "fog of uncertainty"

Step 1: Make Your Sales Assumptions

Step 2: Merchandise Mix of those Sales

Step 3: Convert to Decisions

Online OTB Planning for Owners

Free Access • Webinar of the Week

Simple Tool for Keeping On Your Buying Plan

Ready for another perspective? (It's free)

More Retail STRATA:G® Resources from The ROI