Here we are, in the first week of December, in this tumultuous pandemic year of 2020.
Maybe more than ever, you need to have a grip on your cash flow! What will you cash flow look like during December, January and February?
Since you must be able to make informed decisions about your business, every day, an up-to-date cash flow calculation is essential. Remember, profits are interesting, but it's cash flow that's significant!
Cash flow doesn't have to be fancy. In fact, what most owners need is just to have the basics on the back of an envelope. The savvy ones always have that with them.
But...it's not easy to find an envelope these days. 🙄
So, The ROI has built a basic Cash Flow Gadget to use instead, and put it online. For free. You'll love it.
Then, the real power unfolds.
Why do we call it a "gadget"?
We know. That is quite the understatement. And we also know that anyone could make their own version on a spreadsheet.
But...have you? That's what we thought. So we have.
That's why The ROI will keep providing these practical, retailer-friendly gadgets.* The more practical information you have, when you need it, without a lot of trouble, the better your decisions can be.
And our Cash Flow Gadget is built for times like these. And retailers like that!
Be sure to make it your Gadget of the Month every month.
* We also have plenty of more in-depth retail financial modeling tools. Go here for more info about those.
A few years ago we were on a PBS news show about retailing's ups and downs. Several months later, one of us ran into a teacher of one of our kids. That person excitedly mentioned having seen us on TV, saying "I didn't know you knew so much about retailing." (Yep, known just as someone's parent, right?)
But then this very well-educated person said the key thing: "I never knew there was so much to be known about retailing!"
Well, that incident happened a few years ago when retailing was perhaps more understandable, even more predictable. Alas, those days are history! Today, nothing in retailing is quite as understandable or as predictable as before. Or as manageable!
This is the time of year when most retailers are scheduled to take their annual physical inventory count.
Along with that comes the interruption of daily lives, very serious attitudes of bookkeepers and accountants, and, of course, extra expenses. Oh yes, those!
Typically, preparing for and taking the item-by-item count involves a lot of emphasis on "Make sure to count everything. We don't want to miss anything!" This often-loud focus is true whether the counting is done manually, by scanning, or any other means. "We must count it all!"
Okay, but why? Why is it so darn important to count every last fish hook or candy bar or tube of lipstick?!
It helps to know why.
It's a new year. And now, another new month. How about a new sense of beginning, a fresh start?
Alas, the coronavirus pandemic continues to prove Dr. Anthony Fauci right:"The virus is in charge."
As you have noticed, all around us there's delay. From Major League Baseball contemplating a month delay, schools and universities very slowly resuming in-person classes, or a decidedly different lineup and focus of Super Bowl advertisers, we have no choice but to continue to be patient. Isn't that the pits?
As Daphne Howard reported*, "Footfall patterns show that getting back to normal requires more than flipping the "open" sign.
For most retailers, especially this year, reducing inventory is priority #1. With talk of a 2023 recession still in the air, lingering inflation driving up costs, and rising interest rates, cash is definitely king this year.
Time to revisit your year-end strategies for meeting your targeted ending inventory on December 31. If you are like many retailers this year, with plenty of merchandise in your stores, you know the challenge: how best to turn that inventory into cash? Quickly! Especially without looking like a distressed merchant.
Here's one answer for how to do that. Focus on improving the productivity of each shopper who comes to your store. That is, increase the IPTs (Items Per Transaction.) Make it easier, more compelling and more fun for them to buy more items from you.
This is, after all, The Retail OWNERS Institute. We long have specialized in alerting, coaxing, and applauding retail owners worldwide.
Today's message is a major heads-up.
Keeping pace with the relentless changes in retailing has never been easy. Retailers know that constant adjustments are demanded.
Then, the three pandemics of 2020 happened: COVID; the economic meltdown; the social unrest. And life changed modestly or enormously for almost everyone, including owners of retail businesses.
Heads up. You can take a grim situation and turn it into an advantage.
Universally, there is a shortage of "good employees." While many will use that as an excuse, it can be a great opportunity for those who seize it.
That's why we paid particular attention to this commentary by Ty West in The Playbook*.
And therein lies the opportunity.
Still less than $1 a day! 👀