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  • #971140
    GD
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    Hi all,

    I’m interested in hearing from people in the retail industry.

    My question is, what are the biggest issues that SME are facing in today environment and what are people doing to try and overcome them?

    Any insight would be appreciated.

    Thanks,
    Rob

    #1047993
    beanonlinelately
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    Hi Rob

    I used to work for a major coffee chain in Sydney and I can give you a few issues that retail stores were facing then, and I dare say still to this point…

    1. Cashflow – many small businesses have issues with cashflow because they haven’t got their invoicing sorted out. I always used to say to any business that I was working with to understand your terms of trade with your suppliers so you can balance the money coming in from the money going out. E.g Many suppliers have 45 day terms of trade, say your TOT start December 1, you essentially have until 15th January to pay that invoice. This being the case give yourself 45 days to turn over that stock, don’t order your stock on the 29th December giving yourself only 16 days to turnover the stock and pay the invoice.

    2. Time Management – the book The E-Myth is great in providing clarity on this issue. The old saying that you spend too much time working in the business and not on the business. You just have to set aside time to work on the business, you can free your time up by empowering your store manager or supervisors to take some of the workload from you, they’ll love it because they’re learning, you’ll love it because your time is more readily available.

    3. Costs – the two variables that hurt stores in terms of cost are labour and stock. If you don’t have your staffing levels right, any profit you make will go out the window and into your staff’s pockets, so work out the % your wages should be, we used to run of benchmarks of 25-28% including super etc.

    The other issue is stock? How much do you need on your shelves and in the storeroom? Anytime you have stock on a shelf its money, so reduce your stock levels to an amount that is suitable to your industry.

    There are a number of other costs on top of this such as rent and franchise fees etc but for me these were the big ones.

    I guess also moving with the times and allowing your business to evolve through social media is also an issue these days, I don’t think we can just ‘build it and they will come’ anymore. I think to a point we need to go to them in different ways.

    Well mate, a lot of information in here, I hope your find some of it usefull.

    Cheers, Rod

    #1047994
    c2cemploymentrelations
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    Hi Rob

    I totally agree with Rod’s comments – and coming purely from the employment side of things the number one issue at the moment for Retailers is being compliant with the new Fair Work legislation and finding the costs to cover penalty rates on weekends.

    It makes me very busy, but unfortunately it’s a major hassle for small business with very little assistance from the Government to help them tick the boxes and wade through all the red tape.

    #1047995
    GD
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    • Total posts: 35
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    beanonlinelately, post: 58723 wrote:
    Hi Rob

    I used to work for a major coffee chain in Sydney and I can give you a few issues that retail stores were facing then, and I dare say still to this point…

    1. Cashflow – many small businesses have issues with cashflow because they haven’t got their invoicing sorted out. I always used to say to any business that I was working with to understand your terms of trade with your suppliers so you can balance the money coming in from the money going out. E.g Many suppliers have 45 day terms of trade, say your TOT start December 1, you essentially have until 15th January to pay that invoice. This being the case give yourself 45 days to turn over that stock, don’t order your stock on the 29th December giving yourself only 16 days to turnover the stock and pay the invoice.

    2. Time Management – the book The E-Myth is great in providing clarity on this issue. The old saying that you spend too much time working in the business and not on the business. You just have to set aside time to work on the business, you can free your time up by empowering your store manager or supervisors to take some of the workload from you, they’ll love it because they’re learning, you’ll love it because your time is more readily available.

    3. Costs – the two variables that hurt stores in terms of cost are labour and stock. If you don’t have your staffing levels right, any profit you make will go out the window and into your staff’s pockets, so work out the % your wages should be, we used to run of benchmarks of 25-28% including super etc.

    The other issue is stock? How much do you need on your shelves and in the storeroom? Anytime you have stock on a shelf its money, so reduce your stock levels to an amount that is suitable to your industry.

    There are a number of other costs on top of this such as rent and franchise fees etc but for me these were the big ones.

    I guess also moving with the times and allowing your business to evolve through social media is also an issue these days, I don’t think we can just ‘build it and they will come’ anymore. I think to a point we need to go to them in different ways.

    Well mate, a lot of information in here, I hope your find some of it usefull.

    Cheers, Rod

    That’s great Rod!

    I really appreciate the time you’ve spent on this response, some great insight and information here.

    I realize this was a coffee chain, but did they ever look at or adopt any new technologies to try and assist with any of these issues? If so, do you know how they came across them Eg internet searches, trade shows, word of mouth, sales visits etc

    Thanks again,
    Rob

    #1047996
    JohnW
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    Hi,
    What will be the impact on retail of instant price comparisons via smartphones?

    The research and big players seem to indicate that 2011 will see a big jump in smartphone use in Australia.

    This USA Today video gives a feel for what may be on the cards for retailers next year…

    “More consumers let their smartphones do the shopping”
    http://www.usatoday.com/money/industries/retail/2010-12-10-mobileshopping10_CV_N.htm?loc=interstitialskip

    “Using the mobile app, shoppers can scan an item at a store and see information on the best price on the product across multiple retailers. They can try to haggle for a better deal while they’re in the store, or buy it for less through a competitor”

    Regs,

    JohnW

    #1047997
    beanonlinelately
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    • Total posts: 80
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    Hi Rob

    Glad to be of assistance, yeah the business did invest heavily in infrastructure from both a retailing point of view and also a warehousing point of view.

    I wasn’t privy to much of this detail but the gist of it was to ensure that the best price was negotiated on everything from cups to point of sale terminals to ensure that the franchisees could increase their output in the areas mentioned earlier.

    A lot of the business was through trade shows yes, but due to the high profile a large number of the businesses I believe actually approached the franchise about their products.

    Cheers, Rod.

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