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If You Have to Ask …

I stood up on stage in front of a crowd of retailers and said, “If you have to ask how much it costs, …”

The crowd answered in unison, “You can’t afford it!”

That quote is attributed to J.P. Morgan and is so common and pervasive that if you say the first half, almost everyone can tell you the second half. So why do so many stores put out merchandise without price tags forcing customers to ask?

Michigan was the last state in the union to get rid of its pricing rules where every product that could be priced had to be priced. The Michigan Retailers Association was against this rule because it put an undue burden on large retailers having to price out every single item.

Imagine the cost of all those price tags and the staff necessary to tag all those items. Oh the outrage! (sarcasm intended)

Frankly, as a consumer, I loved that law. I hate having to walk around the store looking for a scanner to verify if the price on the shelf is correct (if there is a price on the shelf at all!) I find it annoying when items aren’t priced. Many of your customers do, too.

Putting price tags on products is not a cost issue. It is a customer service issue.

I’ve talked before about how signs increase sales because a large percentage of the population would rather read a sign than interact with a salesperson. Price tags are the lowest hanging fruit on the sign tree.

Price tags are one half of the Value Equation (Perceived Worth versus Actual Price). Without a price, a customer cannot finish that equation and make a decision to buy on her own. Many of those customers walk away without asking an associate for help.

Image result for if you have to ask how much it costs you can't afford it“If you have to ask how much it costs, you can’t afford it.” J.P. Morgan

That quote popped into my mind last weekend while I was shopping in Dillard’s. They have a nice Big & Tall section that has mostly served me well since I discovered it. Several items, however, were not priced. I couldn’t help think how often I moved on to the next item that was priced rather than look for a sales associate.

I’m not your typical male shopper. I will ask for help … if it is convenient enough. Unfortunately, more and more stores are cutting back on their sales force, leaving fewer and fewer sales associates even available to help me.

This is the downward spiral of customer service that is driving customers to the Internet. Yes, pricing your items is a Customer Service thing. If you aren’t pricing every individual item that you possibly can, you aren’t offering good customer service.

If you aren’t pricing every individual item you possibly can, you’re losing sales.

In the big box stores I can take an unmarked item to a scanner somewhere on the floor. In a smaller store I may just scan the UPC with my phone and buy it online right in front of you.

I hated when Michigan finally gave up the price tag rule. It meant worse customer service for consumers in general. It meant lower costs for all those big-box competitors that didn’t care about customer service in the first place, and it drove more people to the Internet for shopping just to avoid the lousy customer service they got from the big retailers.

Yeah, it gave me a chance to outshine the competition with superior service, but for most people it lowered their overall perception of brick & mortar shopping in general. All boats sink with the tide, too.

You might think buying all those price tags and paying staff to tag all those items costs too much. I will tell you that by not properly pricing your merchandise, it is costing you far more.

-Phil Wrzesinski
www.PhilsForum.com

PS The last thing you ever want a customer to think is, “I probably can’t afford it.” Yet since that J.P. Morgan quote is so pervasive, that is exactly the thought in their head every time they can’t find a price. I can’t make that quote or that thought go away, but I can encourage you to eliminate that thought in your store. Make your pricing crystal clear.

PPS One other benefit of pricing all your merchandise is Trust. If your stuff isn’t marked, it looks like you’re hiding something or playing games with your pricing. That undermines trust, which undermines relationships and loyalty.

Teaching Your Staff Product Knowledge

One of my favorite activities when I was a camp counselor was something we called a Dutch Auction. For the Dutch Auction, each kid in our cabin would take his pillow case and put ten items in that pillow case. With our collection of items we would head to the Auction. At the Auction the support staff played judge. One person would call off an item to be “auctioned” such as a purple toothbrush. Your cabin would have to look through your collection of stuff to see if you had a purple toothbrush.

Image result for purple toothbrushIf you did have a purple toothbrush, you showed the judge and your team got a point. If you didn’t, you tried to come up with creative alternatives that the the judges might agree was a “purple toothbrush.” For instance, if you had anything purple, you would take it up to the judges and begin “brushing” your teeth with it. The more creative you were, the more likely the judge would give you a point.

I loved this activity because of the creativity and imagination required to get a point. I loved this activity because it got the kids in the cabin working together, especially when they called for the “longest shoelace” and everyone started pulling out their shoelaces to tie them together into one long lace. I loved this activity because there was always laughter and always out-of-the-box thinking. I loved this activity even though I almost lost my first camp counselor job my very first week when my senior counselor and I taught our sixth-grade boys an inappropriate chant (we still got a point and we made the whole dining hall roar with laughter, so it couldn’t have been that bad??).

Are you surprised I adapted the Dutch Auction into a staff training?

We’ve all heard the mantra of selling Features and Benefits. What happens, however, is that we spend our whole time training on the features of an item, without really exploring the benefits. Yet it is the benefits that actually sell the item.

Let’s define those terms:

  • Features = what a product does
  • Benefits = how using that feature makes your life better

Features are just facts and data.

Benefits are the visualization of the product solving the problem you’re trying to solve.

Benefits are the results you get because of the features. Benefits are emotions and feelings. Knowing the features is only half the battle. You have to know what results and feelings those features give you.

So, I held a Dutch Auction with my staff. I broke them into teams and sent them out to get three new products each from the shelves. Then I started calling off the items I wanted to see.

Show me an item that …

  • Helps a parent save time
  • Helps a child become more coordinated
  • Fosters a better relationship between siblings
  • Makes bedtime easier
  • Teaches better manners
  • Teaches compassion
  • Increases planning and organizational skills
  • Fosters increased cooperation

You won’t find any of these outcomes on the packaging of any of the toys we sold, but those were real benefits our customers were hoping to achieve.

By playing this game, my staff began to look at the new products with a different mindset. They began imagining the benefits of each item, thinking about the product from the end result point of view.They went beyond what the item did to how the item made your life better.

We followed up this exercise with another one, a fill-in-the-blank I called It does/So that.

This product does (feature) _____________, so that you (benefit) ___________________ .

Everyone grabbed three new items and shared three It does/So that statements. By the time we were done, we knew the benefits of 36 new items.

Not only are Dutch Auction and It does/So that powerful ways to get your staff thinking more about benefits than features, they are fun, too. Plus, they get your staff thinking outside the box and working together. Win-win-win.

-Phil Wrzesinski
www.PhilsForum.com

PS Another way to put it … Features are about the product. Benefits are about the customer. It is always about the customer. Always.

PPS Want to make your merchandising stand out? When you make a sign for a new product or category, make it about the benefits to the customer instead of the features of the product. You’ll win far more hearts faster than ever before.

Product Selection – Curation or Saturation?

I went to visit a fellow toy store owner in Cleveland. At that time Michael had three stores in the area. The store I visited was on the opposite spectrum of mine in terms of size. He had about 1,100 square feet of selling space. I had 16,000 square feet of selling space. Yet we were both successful toy store owners in our markets. I love seeing stores like his and discovering the creative ways they show off all the wonderful and unique products they carry. I often saw many of the same brands we carried.

We got to talking about the different challenges of running small versus large stores and one of those challenges was buying product to fill the shelves, especially something as simple and common as jigsaw puzzles. Michael had about 4 feet of space dedicated to jigsaw puzzles. I had about 44 feet of space.

Michael said, “It must be hard for you to buy puzzles to fill up all that space.”

“Are you kidding? It’s easy, I just go through the catalog and buy them all and let the customers decide which ones I should reorder. I think it would be way tougher trying to narrow it down to only four feet.”

That was the big selection difference between our stores—Curation versus Saturation.

Both methods have their pros. Both have their cons. Both can be used as your calling card to advertise to potential customers the advantages of your “Selection.” (As I said in a previous post, the customers you can most easily steal from your competitors are customers who shop the category killer in your industry for the Experience and the Selection.)

This was just the young kids puzzles. Opposite that was another 44 feet of jigsaw puzzles!

SATURATION

Saturation is when you give your customer all the possible (or likely) options for any given product category. I found it was much easier, when buying jigsaw puzzles, to pick the ones I didn’t want than to pick the ones I did want. I often heard myself telling the rep, “I’ll take everything from that collection except this one.”

In a store of my size, Saturation wasn’t only easy, it was necessary. We needed a lot of product to fill our shelves and make our store look full. We used that method of stocking for many different departments and categories. We also played up the strengths of Saturation by pointing out that we carried more toys from more vendors than any other toy store in America—even Toys R Us! We bragged how we were the largest toy store in America because of it. (He who has the most toys wins!)

The downside to Saturation was twofold.

First, we had a lot of products that didn’t sell well. We had more than our fair share of slow movers. I solved that problem by having an annual clearance sale every July to get rid of the merchandise that didn’t move. Our inventory turns, however, were lower than the average for indie toy stores.

Second, sometimes we overwhelmed our customer with too many option. Analysis Paralysis. To overcome that I needed to have a staff that knew our products inside and out. We spent a lot of time training the staff to curate the selection after the customer explained what she needed.

Your Category Killers built their entire business models around Saturation. Saturation appeals to the customer who wants to browse and sort through the options. Saturation appeals to the customer who doesn’t know what she wants. Saturation makes you look like the expert. Bigger, better, bestest.

When these stores first opened up they were amazing. Nowadays, however, that saturation (especially without a knowledgeable sales staff) seems overwhelming or simply a waste of time and space. Many of these same stores are now building smaller footprints because they realized they don’t have the payroll to staff such a huge store properly.

CURATION

The other side of the coin is Curation—when you pick only the best items or options to offer your customers so that they don’t have to make any tough decisions.

Curation is great because it streamlines the process for the customer. It is attractive to that same customer who didn’t know what she wanted because it takes some of the guesswork out of the equation for her.

A carefully curated product selection can also send your customers the message that you are the experts in your category … As long as you have first earned their trust.

Curation without Trust is just a “poor selection”.

Here is how you win their Trust with your Curation:

  • Make sure you have the best solution available, no matter what it costs. If one of your competitors offers a better solution, you didn’t curate well. Be ready to defend why it is the best option. (PS You don’t have to sell a lot of that option, but you do need to have it.)
  • Make sure your selection is neat, clean, organized, and well-merchandised. If it looks like you don’t care about your products, no one will trust your Curation.
  • Make sure your sales team knows every product inside and out including how each item is used and the difference between the Best, Better, and Good options.
  • When you show a customer your options, ALWAYS lead with the Best.
  • If you don’t carry the “most popular” item in that category have a simple and understandable explanation why. (“We can’t get it,” or “It sucks.” are not good answers. Try “It is an exclusive to … but we prefer …” or “It doesn’t work as well as this option because …”)
  • Make sure you are never out of stock of the best selling option.

If you have a carefully Curated collection of merchandise, you can win the Selection crowd just as easily as if you have a Saturation of products. You do it by advertising that you’ve taken all the guesswork out of the equation.

Both methods can help you steal customers away from your competitors, but only when you do them right and with purpose.

-Phil Wrzesinski
www.PhilsForum.com

PS One big discussion taking place in the indie toy world right now is whether indie stores should pick up more of the mass market lines Toys R Us used to sell to try to win over those customers. The answer to that is Yes and No. Yes, if the product is both one of the best options to have in your Curated selection and also one that you can be profitable selling. No if it doesn’t meet those two criteria. More often than not the Category Killer had the “most popular” item. More often than not, that item was not one of the best options. As long as you can answer why you don’t carry the most popular item in a solid way, you’ll win over customers.

PPS Of the two methods for product selection, Saturation takes more money, Curation takes more time. If you have the resources (space and money), go for Saturation and combine it with a killer trained staff. You’ll be well on your way to becoming a Category Killer.

PPPS There is a Third Option. Curation with special order. The newer, smaller Category Killer store formats are using their distribution centers to order in the products they don’t keep in stock in the stores. They don’t want a customer walking out the door empty-handed. While this is the ultimate situation where you can get anything a customer wants in a day or two, it is built for the customer who knows exactly what she wants. Until your vendors can support you in that manner, make sure you have the right solutions and a staff that knows what you sell.

I Didn’t Steal a Bunch of Candy

I didn’t steal a bunch of candy. Oh, I could have. I bought some over-priced M&Ms at a candy shop on the Magnificent Mile in Chicago. The checkout was at the back of the store in the most awkward place. I had to walk up a ramp, stand in a line, then stand in the entry way to the nostalgic candy area near the back of the store to pay for my purchases.

I watched customer after customer walk away from the checkout with a decorative paper bag into which they could have tossed tens or even hundreds of dollars worth of loose candy from multiple displays on their way to the front of the store. I don’t think they did. I didn’t. But I could have.

Sure, the store had cameras near the front door. But with the crowd that was in that store on a Saturday afternoon, beating those cameras would have been a breeze worthy of the Windy City.

It wasn’t just the shoplifting aspect that bothered me with the layout of this particular store.

The registers were side by side, but the line to get to them was beside them, not in front of them. If someone was at the first register, by the time it was your turn, you had to scootch around them to get to the second register. If someone big, or a party of two or more was at the first register, you couldn’t even see the tiny little cashier at the open register.

The registers were also poorly placed in the doorway to a special section of nostalgic candy. You know Nostalgia is one of my Core Values. I was excited to enter that section. I was a lot less excited waiting for the gal at checkout with her stroller that was blocking my entry to the area.

I suppose if you’re in a large city like Chicago, catering to the tourist crowd, you can overcharge for your goods to offset your shrinkage and create a layout that frustrates the heck out of customers knowing that they likely won’t be back anyway.

If you’re not in this situation, you might want to plan your layout more carefully.

Put the cash-wrap where you can see everything and everyone in the store, but also close enough so that once people check out, they can easily leave. More importantly, plan the line of customers for checkout so that they don’t block other customers trying to shop. Best of all, make it easy and intuitive for customers to know where to go and what to do when they are ready to check out.

I know there is a train of thought that says you want a layout that gets people to the back of the store. Using your checkout as the lure, though, is not the best way to accomplish this, especially in a store that has a ton of traffic and sells easily-pocketed items.

This kid definitely wasn’t as enthralled with this candy shop.

-Phil Wrzesinski
www.PhilsForum.com

PS I will give them props on the centerpiece display. The giant lollipop tree pictured here was worthy of the stop and a good example of Over-the-Top-Design. They also had several choose-your-own-flavor stands for things like Jelly Bellies, M&Ms, and other candies. But then again, the last feeling of the experience is the lasting feeling of the experience. Don’t let your customers walk out unhappy, confused, frustrated, or befuddled.

Now is Not the Time to Panic

Long before there was ever Cyber Monday, there was Letdown Monday. You worked incredibly hard gearing up for Black Friday (and now Small Business Saturday). You planned events, did marketing, trained the staff, decorated the store, and had a nice busy weekend. Then Monday hits and you wonder where all the customers went.

You feel a little letdown. You feel a little worried that you didn’t get enough momentum to carry you through the season. You worry that Cyber Monday is stealing your dollars while you sit there feeling helpless. You start to wonder why you didn’t put more energy into building your own website, or why you didn’t plan a lot of deals for Cyber Monday to keep the customers in your store, or that you have too much inventory, or that you don’t have enough inventory.

In the immortal words of The Hitchhiker’s Guide to the Galaxy – Don’t Panic!

Image result for hitchhiker's guide to the galaxyI know the feelings of this week. I lived it for twenty three years, and lived with it for another twenty seven. The slowdown from the busy weekend gives you too much time to think about what you might have done differently, what you haven’t done, and what you’re afraid might happen.

That’s a natural reaction, but not all that productive. I’m here to put it all into perspective.

First, let’s talk about the slowdown. It is a natural ebb of the season. Happens Every. Single. Year. The busiest days of the year are typically:

  • Saturday before Christmas
  • December 23rd
  • Second Saturday before Christmas
  • Black Friday/Small Business Saturday
  • First Saturday in December

This year the 23rd of December happens to be on a Saturday making it extra special. Also you get a bonus of having four Saturdays in December prior to Christmas. Still plenty of big days to get the sales you need. You just won’t get many this week because there are too many days before customers truly get into that Christmas mood. This year, with Thanksgiving extra early, you have a long season. Expect a little customer (and staff) burnout.

The slowest week of your season is this week.

This is not the week to panic. This is the week to prepare. 

In a marathon race everyone sprints off the line. That’s Black Friday. Then they settle into their strategy. That’s this week and next. Finally, they go into their kick down the homestretch. That is your last two weeks. Now is strategy time. Now is preparation time.

  • Put a little extra time into training your staff. Work on role play, on greeting customers, on working with multiple customers at the same time.
  • Put a little extra time into decorating. Sure, you got it done for last weekend, but now is a good time to tweak it, upgrade it, spruce it up. Make it extra special because for the next few weeks customers will actually have the time to appreciate it more than they did in the frenzy of last weekend.
  • Put a little extra time into merchandising. Highlight the high-profit stuff you really want to move. Put the stuff they come in asking for by name at the back of the store so that your customers travel past everything else to get there.
  • Put a little extra time into Social Media. Start polls. Compare two items side by side. Share heartwarming stories. Tell the backgrounds of you, your store, your staff, your vendors, etc. Don’t make it about discounts or drawing traffic. Make it human and interesting,
  • Put a little extra time into you. Do something nice for yourself this week. Your staff can handle it. Take some time to go shopping (if you haven’t already). Take some time to catch a movie or go to a show or go outdoors. Those little things will keep you refreshed for those last two weeks that will be busy enough.

If you are worried about your inventory, keep this in mind. The last week before Christmas will be approximately ten percent of your entire yearly sales. If you don’t have enough inventory for that, then do some buying this week. Other than restocking a few hot items that will sell well after Christmas, too, trust your inventory levels and go have some fun.

-Phil Wrzesinski
www.PhilsForum.com

PS It is too easy to second-guess everything based on last weekend. Unfortunately, that’s the worst barometer you have. The only time to properly analyze the season is after it is over. Right now your only job is to prepare this week to make those last two weeks the best ever.

Three Pictures, Three Smiles

It is soooo easy to bash stores and their poor customer service. I am almost afraid to go out any more because every encounter ends up becoming a post about what not to do.

For instance, I could tell you about tonight’s dinner when the waitress brought the check and then disappeared for ten minutes before returning to take my money.

Or I could talk about the manager who totally dressed down a cashier in front of me for doing something that the cashier never did.

Fortunately there have been positive stories like the clerk at Walmart who helped a new mom who had brought her toddler in to get his meds, only to have the little boy vomit all over himself, his mom, and everywhere. This clerk not only helped clean him up, she helped get mom and the boy into the restroom so that mom could clean up, and even went and picked out a new sleeper for the poor little kid so that he could have fresh clothes to go home in.

It not only reminded me that good people will rise above their surroundings*, it also reminded me that you can’t train “caring”, but you darn well better hire for it.

For today’s post I leave you with three pictures that made me smile.

Creative Display or Prank Customer?

Towel Display I found while shopping

It is highly likely that a customer having a little fun probably did this. But it stopped me dead in my tracks and made me actually laugh out loud. What would have been better is if they had Scrabbled the letters so that they spelled words both across and down. Here is the thing … You can do this yourself. You may or may not have the guts to spell out Bad Ass, but if you’re clever enough, you will surprise and delight at least a few observant folk.

When you do little things like this purposefully, these little attentions to detail remind customers that you pay attention to everything.

That builds trust. Trust creates loyalty.

Signs Sell!

Game Department Signage at Hall of Toys

It might be too small to read here, but this sign I found in the game department of Hall of Toys in Battle Creek, Michigan was quite clever. The sign reads …

Empire Building
Build, protect, and rule over a civilization,
agricultural empire, or business venture to
crush the competition and win.

This kind of signage not only makes the department seem more fun, it gives you a better idea of the types of games you’ll find. The more creative you are with your signage, the more likely customers will stop, browse, and buy. Signs are one area where creativity wins. Be useful first, but mix in some clever and creative to surprise and delight your fans.

Displays That Draw Attention

Animal Display at CR Toys

This came from another toy store. It falls into the category of Go Big or Go Home. Connie found a fun way to highlight the variety of animal-themed toys she sells in her Kearney, Nebraska store.

What I like about this display is the height. There is something fun at every level, something surprisingly delightful everywhere you turn. If part of your customer base is children, do what Walt Disney famously did the day before Disney Land opened. Get on your knees and look at it from their perspective. You see the world at different angles. Make sure you have something interesting in your displays from all angles

That’s your feel-good for today. Keep sending me the good, the bad, and the ugly.

-Phil Wrzesinski
www.PhilsForum.com

PS *I know it was a clerk rising above her surroundings, because while she was bending over backwards to help this poor mom, I watched several other clerks simply stand by and do nothing at all. Some even left the area so they wouldn’t get tasked with having to help clean up the mess. No, she wasn’t the manager, either. I could write a whole other post on what the manager was doing while all this was going on. I’ll save that cautionary tale for later.

My Conundrum and How to Get Past It

I had a sales rep who got mad at me because I refused to display his car seats, swings, high chairs, strollers, and play pens in groupings by their fashions. He had proof that I would sell more if I sorted them by fabric pattern instead of by product type. My argument to him was that customers didn’t buy a playpen because it matched the car seat fabric. Heck, the two items would never be side-by-side after the shower anyway.

My belief was that fabric pattern was a secondary choice after product features and benefits. My belief was that grouping those items together might help his sales by getting customers to buy more of his products, but my staff was skilled enough to find the right car seat, stroller, high chair, play pen, and swing to meet the customer’s needs regardless of fashion.

I was right.

So was he.

This merchandising battle between Brand and Category played out several times throughout the store. Was it better to merchandise all one brand together or merchandise all one type of product together?

More often than not, I fell on the side of putting similar products together first. This, in my mind, served the customer better because she could more easily compare competing brands of the same product she desired. If she wanted a shape sorter, she could find all the different shape sorters from multiple vendors in one spot, making it easier for her (and my staff) to debate the benefits of each one side-by-side.

Because of the size and breadth of our store with over 500 vendors and over 30,000 items, we mostly sorted by category first, and then by brand.

But there is a lot of merit in sorting your merchandise by brand first, and then by category, especially if you have a smaller store.

Brand loyalty still exists. Many brands have spent a lot of time marketing and advertising themselves and building a relationship direct with the consumer. You have customers coming in daily asking for certain brand names. Sections merchandised by brand help foster the emotional connection customers already have with that brand. The customer also begins to associate that brand with your store, and thinks of you every time they see a brand message.

Branded sections are more visually appealing. The packaging is often the same coloring and style which helps to make a completed look. Some brands also give you posters, shelf-talkers, and signs to help you dress up the branded area. Since the goal of merchandising is to get customers to look at the product, the more visually appealing, the more likely the customer will stop and gander.

Plus, in a small store it is easy enough to compare similar products from different brands because you don’t have as far to go.

The downside? Branded sections need to be well-stocked to work. Once your inventory gets depleted, those sections look worn, tired, and uninviting. You can’t fill in with other items from other companies like you can with a category-sorted merchandising plan. You have to commit to higher inventory levels to make it work best.

It took me a while to wrap my head around this merchandising concept—even though I was already doing it with LEGO, Playmobil, and Breyer. Those companies were easy, though, because the brand only existed in one category. To fully appreciate the merits of both styles I had to ask the most important question … What serves the customer best?

When you ask the right question, the answer becomes more apparent …

Both styles of merchandising serve the customer best. One style serves the product-driven shopper best. One style serves the brand-driven shopper best.

If you have brands that drive their own customers, put those items together in one spot and keep it fully stocked and visually inviting. Everything else, sort it by category first.

-Phil Wrzesinski
www.PhilsForum.com

PS When you start building your branded sections, contact the company for materials. They often have free stuff they can send you. Then take it to the next level by doing your own creative work. That picture was our Groovy Girl department, designed by my staff. Our cost was about $90 in material. I had customers begging me for that canopy when we closed because of how much they loved it.

One Easy Thing Even Your Seasonal Staff Can Do

Back in 2005 I started working on a plan. Our store had two major bottlenecks for traffic that made it hard for customers to navigate the store during peak times. Those bottlenecks also made it hard for the staff to navigate, especially with a cart full of merchandise to replenish the shelves. I was reading Paco Underhill’s still-relevant book Why We Buy for the sixth time and knew it was time to revamp the layout of the store to allow for better traffic flow, better sight lines, and better organization of the store.

It took me an entire year, an entire pad of graph paper, a full ream of printer paper, and several hours with a measuring tape in my hands walking up and down aisles before I came up with a new plan. In May of 2006 we closed the store for three days and moved everything. I mean everything. Every single shelf was dismantled and moved elsewhere. The hobby and baby departments traded places. The cash registers and gift wrap counters were moved. The main aisles were widened. The departments now flowed with rhyme and reason. There was room for customers, for shopping carts, and for the staff to restock the store.

Then I went to work on training the staff how to restock and straighten the store. Every day in every aisle we had someone on the team going up and down looking for lost toys, returning them to their homes. Even on the busiest of days we made sure to get up and down each aisle straightening, dusting, and replenishing several times a day.

A new, better layout was only one piece of the puzzle. We had to keep those aisles clean and neat and organized. My grandparents and parents had taught me this one truth about merchandising …

Messy aisles cost you money.

Although messy aisles are the norm in most of your competitors, they hurt your sales both short and long-term. If you only give attention to your aisles and displays in the early morning or after you close, your store gets progressively messier as the day goes by and your on-her-way-home-from-work-got-time-for-one-quick-stop customer gets to see you at your worst. That’s not the image you want her to share with her friends. That’s not the way to WOW her with surprise and delight.

One simple thing you can do this holiday season is assign one staff person every hour for Floor Duty. That person’s job is to spend the entire hour doing the following:

  • Finding misplaced items and returning them to the proper area.
  • Straightening up messy displays
  • Picking up litter, empty boxes, empty displays, etc.
  • Fronting all the items on the shelves and pulling them forward to the front edge of the shelf
  • Filling major holes in displays with back-stocked merchandise

That’s five simple things that even a seasonal employee can learn to do.

Here are the benefits to you:

  • Helps deter shoplifting. Yes, having a staff person on the floor going up and down the aisles makes shoplifters uncomfortable.
  • Helps you find lost items. It is one thing to have software that tells you that you have one item in stock. It is another to be able to find that item quickly to please a customer.
  • Attracts a different level of customers. Transactional customers are willing to paw through messy bins and displays to find their treasures. Customers who shop based on relationships and trust are more attracted to the stores that show they care not only about the customer, but also about the products.
  • Helps your customers get the assistance they need. Customers with questions are always more comfortable asking the busy shelf-stocker than the busy cashier, the crowd of employees talking about last night’s party, or the salesperson waiting to pounce.
  • Helps you increase sales. If you only wait until tonight or tomorrow morning to replenish, you are bound to lose sales because not all customers will ask if you have any in back.
  • Helps you train your staff on the products you sell. The more time they spend on the floor stocking and straightening instead of trapped behind the cashier’s fortress, the more they get to know what you sell.

Best of all, you will definitely stand out amongst the competition. The big box stores don’t have the staff (or apparently the desire) to keep their stores clean and organized. The category killer chains typically stock late at night or early in the morning. The minimum-wage gum chewers never leave the cash-wrap.

Even if you don’t have Pottery Barn merchandising skills, this one move of keeping someone on the floor constantly straightening and cleaning all day long will raise the perceived level of merchandising in your store well above that of the competition. That’s how you win this holiday season.

-Phil Wrzesinski
www.PhilsForum.com

PS Yes, it is in your best interest to have your best salesperson out on the floor at all times. But even having a raw, green seasonal employee that knows how to get answers and solve problems is better than not having anyone out there at all. If you can, buddy up your best salespeople with your seasonal staff and let the newbies learn from the best.

A Fresh Set of Eyes Sees What You’re Missing

Get in a circle of store owners and say the words “Mystery Shopper” and watch the eyes begin to roll. We all hate them or, if that’s too strong a word, think quite low of them.

The problem? Mystery shoppers tend to only take a snapshot of a single moment in your store with no regards to what is going on around them. They evaluate your entire operation based on one interaction, one done-under-false-pretenses-just-to-see-how-you-react interaction at the most inopportune time with the least talented member of your team.

Not fair.

The biggest problem with the Mystery Shopper concept is that most business owners are quick to dismiss the findings as being only a snapshot in time and not a true reflection of your business.

Then again, a new customer walking through your doors will only get a snapshot of a single moment in your store with no regards to what is going on around them. The only difference is that this customer won’t offer you any feedback to help you improve.

You need a fresh set of eyes. You need someone else to help you see the flaws that have blended into the landscape. You need someone to:

  • Look at the appearance of the store from the front. Is it clean? Is it inviting?
  • Walk through the door and give you an honest first impression. Does it smell funny? Is it inviting?
  • Look at the little details like signage and order and cleanliness and lighting and decor. Does the store look or feel worn and dated? Does the store feel dark and dirty or bright and happy? Do the signs even apply anymore? Does the merchandising draw you in?
  • Get a first impression of the staff. Are they welcoming or huddled for safety and comfort?

A fresh set of eyes can identify the subtle turn-offs you stopped seeing years ago. A fresh set of eyes can show you what you look like at your worst, which is far more important than what you look like at your best.

Before listing my house I had a few fresh sets of eyes look it over. We found a door that needed painting. We found a roof area that needed cleaning. We found some rooms that needed re-decorating. We found an outlet cover that was broken. We found paint peeling on the outdoor furniture. We found a mess of cobwebs in the light at the end of the driveway. We found bushes and tree branches and vines that needed trimming. We found a tree that needed to be cut down. We found thirty two cans of paint that needed to be removed.

Individually those are all minor in the grand scheme of life. Collectively, however, they create a perception different from the one I want the people looking at my house to feel. It took more than one fresh set of eyes to find it all.

Get a few friends, preferably ones who do not regularly shop in your store (I know you have them—we all have them). Give them a list of things you want them to notice (the above list is a good start). Then invite them all over to your house for pizza and beer and sharing. You’ll be amazed at what they see, and if you’re honest enough to listen to them without getting defensive, you’ll make sure the “worst” experience anyone has in your store is better than the best at your competitors.

-Phil Wrzesinski
www.PhilsForum.com

PS Don’t think you aren’t blind to seeing things right under your nose. We all are. When I closed Toy House, we found almost $10,000 worth of “missing” merchandise that had been written out of stock over the years. Most of it was in places we looked almost every day. We found signs that should have been taken down years ago. Get some fresh eyes in your store now before the holiday rush starts creeping up on you. That’s worth a few pizzas and beer, right?

The Scary Truth of Averages

“Have you ever noticed that everyone wants to be normal but no one wants to be average?” -Roy H. Williams

Did you hear the one about the statistician that drowned in a river with an average depth of three feet?

Image result for averagesIn business, everyone wants to know the averages, the average cost of rent, the average sales per square foot, the average level of inventory, etc. Averages are interesting. They can be a nice benchmark, but they can also be misleading, and sometimes downright dangerous.

Take, for example, average inventory at cost (a number you should all be tracking). If you were an average toy store doing around $500,000 a year in sales, your average inventory at cost would be around $100,000. But if you are that same toy store, your Thanksgiving to Christmas sales will likely be around $200,000, or pretty much all of your inventory if you only had the average on hand. As nice as it would be to sell to the walls, so-to-speak, you know you can’t sell it all. You also know you need some inventory in January for birthdays and post-Christmas.

Just trying to keep your store at the average will kill your holiday sales. You’ll need a lot higher inventory to start the busy season and much lower inventory the rest of the year. Rarely will you ever have the “average” amount of inventory on hand.

Another problem with that average is that $100,000 worth of toys looks a whole lot different in a 2,200 square foot store than it does in a 1,100 square foot store.

The bigger the store, the more creative you may need to be with your merchandise to keep the store looking stocked and full. The smaller the store, the more creative you may need to be with your merchandise to fit it all in. Sometimes your store space dictates your inventory levels more than just sales or industry averages.

Averages are a nice starting point, but it is worth exploring all the reasons you might deviate from the average, and be okay with those reasons.

For instance, my payroll at Toy House was a significantly higher percentage of our expenses than the average toy store. But I could afford that because my rent was significantly lower. Our sales per square foot was extremely low compared to the average, but that was because we had wide aisles to allow for shopping carts, four cash registers lines, a large gift-wrapping area, and a stage with seating/playing area—in other words, a lot of square footage not used for showing merchandise. Our average ticket, thanks to shopping carts and toy demos however, was significantly higher. Each deviation from the norm was on purpose and with a purpose.

I do many talks about the financials of independent retailers. Whenever possible I try to use an average store for that industry. But I remind everyone in attendance that these numbers are average and they should be striving to be spectacular. If all your numbers are average, you haven’t found the place to stand out and make a name for yourself.

In retail, there isn’t a prize for being normal.

-Phil Wrzesinski
www.PhilsForum.com

PS The upside to averages is that they give you a quick check of the health of your business. If you have a number way off from the averages and you don’t know why, that might be a good place to focus your time and energies on changing. The downside is that you don’t ever want to be an average store. You are destined for greater than that.

PPS Rent per square foot and sales per square foot go hand in hand. You need to be selling at least 10x more per square foot than what you pay in rent (if your profit margin is around 50%). That’s a far better benchmark than average rent or average sales per square foot for your industry. Those averages tell you nothing.