Since March 2, 2020, The ROI's Co-Founders have been offering insights, strategic approaches, and online resources for independent retailers affected by the COVID-19 crisis.
These appeared first in The ROI NEWS.
Each of us, our households, businesses and communities are in different stages of shutdown due to the coronavirus.
While we cannot speak to when this will end, we do have some ideas for dealing with the "fog of uncertainty" that hangs over us all.
FIRST, SPRING CLEANING
There are some steps you can be taking right now that can be thought of as Spring Cleaning.
Foremost among those: clearing out inventory. You cannot wait. You must be taking steps now to reduce your inventory.
WHAT ABOUT YOUR "CLEARANCE" MERCHANDISE?
Here's an idea: Take that really old, out of season merchandise and sell it online to a whole new batch of customers.
If you haven't already been set up to sell online, or even if you have, a new online outlet can be a great opportunity to "dump merchandise" at very steep markdowns away from your present clientele.
GET READY FOR "WHAT'S NEXT"
Okay, start looking ahead to after the shutdown. This will not be back to normal/business as usual!
PLANNING YOUR "NEW STORE OPENING"
In fact, in our minds, do not think of it as re-opening your store; think of it as a New Store Opening. And that means some major rethinking.
Who is your target customer?
Best to have thought this through now. It makes a big difference in how you go about clearing out your inventory, AND in what orders you place going forward.
NEXT, WHAT ABOUT THE IN-STORE EXPERIENCE?
This might be a good time to consider a new layout for your store. (Here's a plus: Often when store layouts are changed, even long time customers "discover" merchandise for the first time.)
REMEMBER, DO NOT MISS THE OPPORTUNITIES FOR CHANGE OFFERED BY A CRISIS!
YES, DEVELOP A BUDGET PLAN FOR YOUR NEW STORE OPENING
Here is where you can take advantage of the unlimited free access to The ROI's 3-in-1 Cash Flow Calculator for retailers. There are just a few numbers you will need for inputs in order to get a first draft. From there, the 3-in-1 Calculator can do all the number-crunching for you.
Remember, customers will be very price conscious (what one economist described as "prone to thrift." Gee, really?!)
There will be clearance sales or Going Out of Business sales all around you. (Another reason to have been aggressive in your Spring Cleaning clearance efforts! You need to beat the rush.)
Think of this as a new store. The first few months (indeed, the first year) will not be what you would expect from your present operation. Do not expect to just pick up from where you left off.
Ready? Here we go.
Don't linger too long over the profit and losses for these first 12 months; it likely will be grim. (It's a New Store, remember? Cut it some slack!)
Importantly, with just a couple more entries from you, the 3-in-1 Cash Flow Calculator will produce an Open-to-Buy inventory buying plan, AND a cash flow projection.
And those are the two areas that deserve your attention and good judgment.
Yes, we know. Owning a retail business these days is one flexibility test after another. And there are no one-size-fits-all solutions.
In the United States, one of the most widespread impacts of the virus is uncertainty. With no end in sight. It is the virus that is in charge. As the president of Alaska Airlines noted, "We don't know what the future looks like."*
But the fact remains, whomever is selling to the ultimate consumer has leverage. Might that be you?
Maybe you know someone like this. Or are related to them. Or are looking at them each day in the mirror.
You know; the restless, impatient ones. The entrepreneurs; the risk takers. Those who want to be their own boss. "Do it myself!"
Our theory is that the changes spawned from these triple pandemics – the coronavirus, the economic meltdown, and the civil unrest – will also be evident in new business startups. And that includes all kind of new retail concepts.
Out of this period of unprecedented frustration can come new-found backbones.
As your stores are able to re-open after the coronavirus shutdowns, how they look tells a powerful story. And for you, a great opportunity.
This is no time to try to go back to normal, back to business-as-usual. Nor to simply have all kinds of protective shields in your store. While necessary, how welcoming is that?
Instead, this actually IS a second chance to make a good first impression! Take full advantage!
Let's assume your stores have been closed for weeks now.
We recognize how conscientious you are. So, after paying what you can to your employees (and yourself), the next most-worrisome dilemma is your rent.
As you likely have discovered, a common choice for many landlords is to offer to defer your payments. But that means taking on more debt, as those payments are only being postponed to a later point in time.
You need a better solution than that.
Don't you feel that we're in a period of heightened uncertainty?
Whether it's the economy, or unemployment, or grocery prices, or sports resuming, or the weather, or racial tensions, or the costs of everything, or the questions coming at us from family and employees that we cannot answer, everything seems uncertain, doesn't it? And there is no end in sight.
But...we as retailers can be leaders in our communities and in our daily lives. We have the opportunity to tamp down some of those uncertainties.
Look at this sign a local merchant posted.
Since 1999, empowering retailers and store owners to "Turn on your financial headlights!"