We thank Evan Wise of Management One® for this great contribution. While retail has always been “detail” the number of details has indeed exploded! Just a minor example is the amount of technology needed today to make a simple phone compared to the knowledge needed even a decade ago. And that’s only a very small hat for retailers who wear so many. Our thanks to Evan for sharing this post.
For many years, Management One® has promoted the mantra “Retail is detail, the sum of doing a lot of little things well.” Over time the importance of this idea has grown and its meaning has expanded.
Back in the 1960s, my father, a menswear store owner in suburban Cleveland, paid attention to detail. He made sure he periodically placed a print ad in the local paper (that the personnel there designed for him). He tabulated daily sales and paid the invoices as they came due. He relied on vendors he trusted and my mother’s gut feel to select the merchandise that he offered each season. Then he hired a sales staff that was responsible for getting the goods sold, with Dad stepping in to facilitate the process when needed. The competition was a store across the street. Those were the details for him!
Times have changed! Retailers now compete against chains, big box stores, the internet and vendors who circumvent brick and mortar retailers to market directly to users. Maintaining margins requires more sophisticated control, relying on better data input than ever before. Successful retailers today use sophisticated POS systems to capture details about each customer, each purchase, each order and more. The mounds of data must be analyzed so that decisions can be made effectively about buying, marketing, selling, merchandising and accounting. Branding and private label options become part of a strategy that must be considered and developed before each season. That strategy must be based on metrics like GMROI, turn, freshness and performance for each individual classification.
Staff cannot just go sell anymore. Goals are established each month and performance tracked. Compensation, based on performance, rewards success and motivates the staff to be better each day. Being better each day requires training, coaching and mentoring to create a great staff. Bookkeeping is more than a book to record daily sales and much more information must be gathered and utilized.
Buying is no longer Mom’s gut feel. More critical than ever to knowing trends relies on discussions with sales staff and customers; attending several markets in addition to watching what customers wear and spend their money on. Having the right merchandising planning budget is the difference between profit and loss in many classifications. Retailers no longer have the luxury of guessing how much to buy when their competitors are using sophisticated trending and mathematical models to predict sales in each classification and then buying the right amounts. When retailers give up profits due to heavy markdowns from overbuying, they create a huge barrier to profitability. Markdowns narrow the band of opportunity, making detailed analysis of customers and trends more critical.
Merchandising details are also more important than ever. Shopping is now entertainment and environment. Neat shelves, clean stores, lively music and upbeat staff all contribute to a pleasing environment. Signage and design are important contributors to visual appeal. Displays and windows are critical to attracting and keeping people in the store. Changing these frequently and always featuring the new goods create interest and increase customer traffic. Last but not least, make sure your store is fun!
