We were recently approached to help some retailers address their concerns about the tough retail trading conditions being experienced by many. Here is a brief summary of the key points we covered. We share it today in the interests of helping retailers more widely improve their trading situation.
Every retail business needs:
- Timely access to accurate business performance data.
- A commitment to efficient use of all resources.
- A focus on quality fact-based business decisions.
Too often, retail stores in decline or closed have ignored these three key factors.
Good Point of Sale software, used well, can address these and other key goals of any retail operation. Good is the key word. Generic off the shelf POS software is probably not good. If your retail store has specialist needs, or needs which are particular to your channel then you will need software designed for these needs.
Having the right POS software is only part of the battle to save the business though. You need to use the software well otherwise it will store garbage and garbage data will guide you to making the wrong decisions. To use POS software well:
- Get suppliers to provide invoices and stock files electronically. Load these into your software without re-typing the information.
- Track your sales by scanning everything you sell. This is a must! Retailers who record sales only by a department key are wasting their time.
- Track your sales by employees – yes, get them to enter their code for every sale … mistakes will fall as a result.
- Place orders for replenishment stock by using your software to do this for you. Stop ordering by a visual review of what is on the shelves or gut feel.
- Manage customer theft by doing spot stock takes. Once you know something is being stolen you can work to address this.
- Regularly check on employee theft by looking at audit logs and other reports in your software.
- Use the software to see what items are not selling as fast as they should. Quit this stock. Slow moving stock is death in retail.
- Choose the best two or three reports from the software and produce these weekly. These reports, if your data is good, should help you make better quality, fact based, business decisions. The best reports are those which track sales comparing trading periods by unit sales and revenue, list basket size and enable an easy comparison of supplier performance.
- Commit a set amount of time each week to analysing data ans makingbusiness performance data based decisions.
Using your Point of sale system well is the key. It takes discipline from the front counter to the back office, the support of suppliers and vigilance throughout the business. The result is a more efficient, profitable and enjoyable business for the owners, employees and suppliers. Seriously, good software used properly can deliver a genuine turnaround result for a retail business. A modest investment can create a retail business which is profitable for the long term.
If your retail business is doing it tough, look at your POS software in the context of the advice above.
