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Moxie, located in DeKalb, IL, is a great example of how to avoid retail mistakes.

5 Retail Mistakes to Avoid

Surprising Fact: Most retail owners have zero retail experience before opening their stores. While this should not keep you from starting a retail business, it should be the stepping stone you need to begin really learning about the business of retail.  As part of your learning curve, it’s important to understand common – and sometimes fatal – mistakes that are often made.

Mistake 1:
First Focus Being Product – While understanding your product assortment is extremely important, it is equally as important to understand all the reasons someone may want or need this particular product. In doing this, you need to evaluate your competition as well as the economy. Even if you have done this before, you must continue to do this as both the competition and the economy are constantly changing. Both of these two factors will influence whether or not consumers will purchase what it is you are selling. As a retailer or a wholesaler, this responsibility should be maintained on a regular basis.

Mistake 2:
Customer Service – Whether you give too much or too little, providing valuable customer service is one of the most important tools a small retailer has in making their business profitable. In addition, often employees of small businesses range from horrible to outstanding depending on if their boss is within an earshot or if they make commission. Think about your own employees if you have them – do you think they work differently when you aren’t around?

You should evaluate the customer service being delivered from every angle of your business – from answering the phones to greeting customers who walk in the door to follow up procedures after purchases made. There are a variety of traditional customer service tactics that can help maximize your business, as well as there are many creative ways you can take this approach. A good way to really understand the customer service being delivered in your business is to have someone else who has no personal attachment to your business evaluate it. You can get this done through a mystery shopping analysis, as well as you can have someone you trust complete this for you. Retail Minded recommends having at least three people do this to get an assorted view of your customer service. Most mystery shopping analysts would include multiple viewpoints in their review, as well. If you choose to do this on your own, however, you need to make sure you trust that you will get honest truth whomever you ask – whether good or bad. This is the only way to really know how your customer service is being perceived.

Mistake 3:
Retail Demands – No one who has ever worked in retail has said it’s easy. On the contrary, people who have never worked in retail think it’s easy. The reality is that retail demands a lot of dedication, with time being one of the most important things you need to dedicate yourself to. Too many people think that running a successful retail operation can be done part time, however this really equals success.

It should be understood up front that operating a retail store is a constant cycle of budgeting, buying, planning, merchandising, marketing, and more. The cycle is endless, therefore time is necessary. If you don’t have the time, you can’t realistically think you will be successful in retail. This holds true for running a wholesale business, as well. While wholesale may not always be as demanding in the beginning, it can get as demanding as your product reaches more stores and re-orders start coming in. And of course, it takes time to even communicate with store to begin with! This is a great problem to have, but you have to react to it professionally to keep your customers satisfied and product on target. So whether you are a retailer or a wholesaler, you need to find the time to make your business a success. How you plan that time depends on a million other things, so you better get started!

Mistake 4:
Wasting Your Time in Details – Paying attention to details is so valuable for business owners. The details of a business can make or break success. What is surprising, however, is what details retailers often pay too much attention to, therefore keeping them from spending more time on the details that matter. For example, if you are merchandising fixtures in your store with new merchandise, you will ultimately need to decide what product will be seen from the best possible angles in your store versus the least desirable.  If we look at this from an average perspective, they may have merchandised four total SKUs of product over the course of eight hours. Had they made their decision during a reasonable amount of time or outsourced the merchandising, their time would have been better used to get more work done. Knowing your strengths and weaknesses can often help you designate how to spend your time in the details. For example, if you know merchandising is not your thing, then you need to decide how to get this done effectively – even if that means outsourcing this work or doing it yourself during a certain allotted time-frame so that you don’t get consumed by it. Be aware of how time can catch up with you, though. If it’s wasted, than you are not maximizing the opportunities you have to make your business a success. There is simply too much to do to waste your time on the little things. At one point, you will need to make a decision and run with it, even if you are not 100% in love with whatever it is you are deciding on. Bigger decisions, of course, deserve more time and should take more time. But deciding the font on your business card, for example, shouldn’t be something you lose sleep over.

Mistake 5:
Support Matters – There comes a time for every business owner when they recognize their professional weaknesses. Sometimes, this happens right away while other times it takes what seems like forever. Either way, when the time comes that business owners recognize what they cannot do well enough to support their business, the option of having hired support should be considered. There are experienced retail consultants who can help advise small business owners in a variety of retail sectors, including marketing, publicity, and buying, as well as support them in the execution of some retail needs, such as merchandising, special events, and accounting.  The investment in this support can make a valuable impact on your retail success – or failure. Make sure whoever you hire is experienced in the area of expertise you need support with, and don’t be afraid to ask for references or interview them extensively. It may also be useful to hire a college student who is studying retail for some of your support needs, however this will not always be effective and although often less expensive, should not be your only support system. Consider all of your options before making any decisions that will cost you money, but don’t be afraid to spend money if it will help get you ahead.

 


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