As we look out at the second half of 2023, we're actually quite optimistic for independent retailers worldwide. No, really!
The statistics haven't yet borne out what we are "seeing," but just wait a bit.
To begin our justification, let's look at the really Big Picture. Generally, the Covid pandemic has been wrestled down. Likewise, inflationary prices seem to no longer be a threat. The worrisome political scene has resumed its traditional state of boredom, and the major concern now is something we can't do much about: each day's weather.
So, looking at the Big Picture, we see the general population for the second half of the year to be quite serene, even optimistic. And that bodes very well for shoppers' confidence!
Throughout the pandemic, millions of shoppers – including the older Baby Boomers – discovered the benefits of online shopping. Then, as brick-n-mortar retailers scrambled to survive, the increased availability of delivery, curbside pickup, BOPIS (Buy Online, Pickup In Store) and BORIS (Buy Online, Return In Store) was well received by a broad swath of consumers.
We see that this has brought heightened awareness of two different retail strategies: Convenience Retailing versus Destination Retailing.
And here's the deal: retailers now must choose either one or the other of those two strategies. You cannot have one foot on the dock and one foot in the boat. You DO have to decide!
We're sure you'll agree. Misinformation can be very harmful. Retailers surely don't need more harmful anythings!
Just last week, we came across the proverbial straw that broke the camel's back. It was a post on the Intuit Quickbooks site*, titled "Inventory Turnover Ratio." And the explanatory article was accompanied by an "Inventory Turnover Calculator."
What do we take exception to? The misleading and/or incorrect information it provides. For example, their "Inventory turnover calculator" requires two entries.
We must take exception. "Total costs involved in selling your products" is NOT the same as Cost of Goods Sold. Nor do they specify that it should be for a 12-month period of time.
We must take exception. What they surely meant to say is inventory @cost.
Successfully "doing retail" has always been a challenging and fascinating and evolving exercise. As the old Chinese proverb states, “It’s easy to open a store. However, it’s tough to keep it open.”
And today, seemingly more than ever, third party organizations, more than individual entrepreneurs, seem to be drawn to retailing. Consider:
These and others fit into our category of “retail-as-added-use.” "It looks easy. Why don't we open stores?"
But, retailing is not their core competency; they are manufacturers or direct marketers, or wholesalers, or importers, or whatever.
The Retail Owners Institute® makes it easy for you to get a quick financial health assessment of your own stores, as well as the retail industry, and every vertical within it.
From farm stores to apparel stores, wine stores to tire dealers, gift shops to convenience stores; all 45 verticals.
Here's how to get started.
Quite a picture, isn't it? Which ratios are trending up? Down? Any suggest some shaky times ahead? Any surprises? But most importantly, how will yours compare?
Managing inventory – arguably the #1 responsibility of a retailer – has been beset by a host of new and sometimes daunting challenges since 2020.
The last few months of 2022 only made matters worse. As supply chain issues seemed to subside, foreboding talk of a recession dominated, dampening customer spending.
Many retailers are feeling a bit over-inventoried as a result. Similar to that sense of having a few added pounds after the holidays.
In other words, a situation that is crying out for perspective. And The ROI has you covered on that!
What is the definition of "value" for customers? Pretty straightforward, actually.
Wait. What? "Benefits received?" "Burdens endured?"
Turns out, the only single answer to "What is value?" is, "It depends."
Don't just roll your eyes. What constitutes value for your customers increasingly is a make-or-break part of retailing.
Consider this retailer, whose sales over the last 4 weeks are down 12% compared to last year.
Some retailers in this situation essentially freak out.
But others know to keep asking questions. Before they decide what to do next to fix lagging sales, they want to know "Why?"
So, here is one way to get to the numbers behind the numbers; to begin to know the "why" of your sales trends.
All it takes is tapping into the data that's already in your POS system, and putting together a little summary tally sheet. Here's one example.
Still less than $1 a day! 👀