Starting a new business venture can be challenging, rewarding and fulfilling at the same time. Unfortunately, many small retail businesses are not successful and close the doors. Creating a thriving enterprise isn’t always as easy as many make it out to be, but with proper planning, and a cohesive business plan that targets a defined market, chances of success are much better. There are some things that are critical in making a viable and successful business.
Location is Everything!
A fatal flaw in establishing long-term viability of a retail enterprise is the wrong location. Many people underestimate this and think a lower rent will help minimize startup costs and that customers will just appear once the doors open. A less than adequate location will create a situation where customers bypass the store and thus not generate revenue that will make the business a success. A strategic location that taps into existing foot traffic is a key to success. If the business has to expend more resources on advertising to let potential customers know where the business is, it will decrease profits. Additionally, if a customer has to expend added time to get to a retail destination, they are going to want to be rewarded with a much better shopping experience. Unfulfilled expectations will cause a customer to never return. They will also tell others about their experience. Word of mouth is the best advertising a retail business can have so a good first impression is crucial.
When investigating a location, one important thing to consider is the number of other existing successful, non-competing businesses in the area. The best way to attract customers is to be readily in front of them as they are on their way to a neighboring popular business destination. This is one reason why malls are so successful, as it is a contained area with a lot of stores and a concentration of shoppers whose main objective is to spend money. While malls come with many rules and regulations, they do serve a purpose and work quite well to provide needed customer traffic.
A Shopping Experience
In today’s fast paced convenience shopping world, one of the biggest competitors and potentially deadliest for a retail enterprise, is “online shopping.” Online shopping can be much cheaper. A “Main Street” business often cannot compete with the prices that can be found online in. Despite this convenience feature, there is one component an online shop cannot provide — the human touch. When a customer knows that they can go to a store and have their questions answered in a friendly fashion with a smile they are more likely to defer online shopping to visit the store that makes them feel special. If a business owner can establish a reputation for consistently great customer service the business will generally succeed.
There are a few key things to consider facilitate good customer service:
Staff: Business owners need to hire staff wisely and provide competitive pay to get a better quality employee. The last thing a business owner wants is to have a potentially long-term customer go elsewhere because an employee mistreated them because they feel unappreciated because of low pay or some other factor that had nothing to do with the customer. In addition to competitive pay, a lucrative commission structure goes a long way in keeping employees happy and more willing to treat customers the way they should be treated. Nothing kills morale more – and a business – than unhappy employees.
A Customer Friendly Store Layout: When planning a store layout, a business owner should put themselves in a customer’s place. They should think about what it is they want to see the first time they walk in the door and the feeling it gives them. A good first impression is important to any business. The first impression a customer has will generally determine the success or failure of a business. A “happy” display or one that brings a smile to a customer’s face upon walking in is a great way to make them want to venture further to see what else is available. Another good way to create that good first impression is to put the top selling merchandise near the front door in order to keep them browsing.
Embrace change: Change is a fact of life and keeps things fresh. If a store owner can create a desire in the customer to keep coming back to see what changes have been made it will go a long way in retaining them as regular customers. Changing things around will also provide invaluable information about what works and what doesn’t.
Customer Engagement: Today’s Internet world can work to the benefit of a “Main Street” business if it successfully engages customers. Posting deals on social media outlets will create curiosity and a desire to venture to the store. A good indicator of what works and what doesn’t is by the number of people coming to a store based on reviews read online or other related comments about the business that attract them to the store’s location.
Inventory Customers Want
Too many businesses overstock to try to provide customers with every imaginable item they could conceivably want. Instead, an inventory based on most popular items being purchased minimizes costs related to too much inventory since it all has to be purchased upfront from suppliers. Efficient inventory tracking based on consumer tastes and what’s popular in the market will provide invaluable information to become even more successful and create a long-term presence. Keeping inventories small and switching brands and products based on current market tastes is a good way to keep a store exciting and fresh. Purchasing professional inventory tracking software is priceless, as it helps evaluate what’s selling and what’s not. Technology should not be feared, as it will keep business profit margins heftier and not waste valuable shelf space with products people are not buying.
Pricing is a key to any successful business. A conscious decision has to be made as to whether to be cheaper, equal or more expensive than the competitor. One factor in making this determination is to evaluate what customers are coming in the store to buy and what they can afford. If the predominant clientele can’t afford the higher prices being charged they will go elsewhere. Ultimately killing a business.
Automation is the Sign of the Times
Once a business is established, the next step to consider is automating work flow and other business processes. Successful business owners know the importance of technology and they put it to work for them to streamline the way business is done. As a business owner, the key to a successful business is to have it run smoothly while not physically in the store and have the proper monitoring and controls over inventory and staff to keep the business viable.
Retail businesses can succeed by following some basic, simple steps to adapt it to today’s technology. Doing so will provide invaluable knowledge of the way consumers are buying their goods and services and what they are buying in order to better compete in an “online” world.