By Gordon Hecht, Serta Simmons Bedding
In a normal year, this is about the time that the major league baseball pennant races are getting interesting and football season is starting to fire up.
The inevitable argument ensues about which is our nation’s most popular sport. Baseball may be called “America’s pastime,” but my favorite pass time is third and long.
You’ll soon be pulling another page off the wall calendar and we’ll be down to the final quarter of the year 2020. Retail has seen success stories, but we have endured far too many unimaginable challenges, and I’ll wager very few retailers will be sad to see this year fade into the rearview mirror.
This has been a year to reconsider how we do business and how we prepare for disruption. Retailers who took early action tended to fare better than those who waited to react. The positive steps we take in the final quarter of this year will help us prepare for a strong 2021. Here are some offensive and defensive plays to consider:
Inventory
This is where I have revolutionized my opinion the most. I’ve never been a fan of stocking wide or deep. I’ve preached that inventory has a price, in damage, shrinkage and obsolescence, resulting in lost dollars tied up in dead merchandise. You can assign a cost to it: about 3 percent in value/dollar loss per month.
However, this COVID thing has changed my mind. I figured out that the cost of no inventory is 100 percent in lost sales.
Inventory will always be a cost. But like any cost it can be smartly managed and controlled, and when it ceases to have value it can be liquidated. This is a great time to plan your inventory for 2021. Placing orders for stock now ensures that you’ll have a full cupboard on January 1. Go deep on your best sellers (not always the cheap stuff) and keep some luxury items on hand too; having availability on those goods might be enough reason for your shoppers to upgrade.
Recruitment and Retention
I have been banging this drum for most of the past decade. I predicted that the No. 1 issue for retailers will be staffing, and this COVID thing just accelerated the gap between the need for staff and the availability of people who want to work in retail. Recruiting just became a little more difficult with the addition of so many jobs people can do sitting at home in their jammies.
There are simply fewer people who want to work a retail schedule. Now is the time to consider more flexibility in work hours. Adding in a “mommy schedule” of 10:00 to 2:30, and then building part-time and full-time schedules around that, will make your business more attractive to prospective hires.
The next step is to open your doors (and mind) to who you are recruiting. Step one is to hire people that reflect your customers. If you are in an area that skews younger, then hire that age bracket. If you’re in an area with a lot of retirees, then staff for that gang. And everyone likes talking with someone who speak their language, so if you are in an English-as-a-second-language area, staff up with bilingual frontline people. (Note: I worked with a retail store in Mississauga, Ontario that had eight people on its sales team who spoke a total of 10 languages!)
Once you find good people you will need to keep them. It starts with training and setting standards. While factory reps are good resources for product knowledge, the store managers and owners need to provide sales practice training and then observe and constructively coach to achieve results. Be sure to praise in public and criticize in private.
Money, schedule and perks are all part of retention. But the No. 1 reason a person stays or leaves is their relationship with their immediate supervisor. If your staffing looks like a revolving door, it’s probably time to review your coaching and management style.
Advertising
Facebook and other social media saved a lot of retailers this year. There have been more live auctions and store tours on social media, and it’s been a great way to reach customers before they walk in your store. But know this: with this election thing happening, the last part of 2020 (and first part of 2021) will be a dark time for social media, and many people will simply drop off.
More people working at home means more time online. 2021 must be the year that you invest at least 51 percent of your ad budget into digital advertising. You don’t have to be an expert anymore; there are great services out there that can probably do a better job for less bucks than you can on your own!
Store Services
More online time means more shopping, but not necessarily buying, from home. Consider your website as your primary store entrance. Keep it clean, interesting and interactive.
Reserve one or two days a week for shopping by appointment. Give your shoppers a VIP experience in a clean, comfortable environment. After they purchase let them choose the degree of interaction they want. Make pickup easy and convenient and give them the option of doorstep delivery or full white-glove service.
BTW, you may have heard of an online retailer named after a river in South America. They have reached their prime by charging $119 for a year of free (?) delivery. Your store can achieve a degree of loyalty when you charge one-time per year for delivery. You may not get every sale from your customer, but you’ll get the first chance when they shop again.
Remember, the year is not over. There are still three full months more to throw a few Hail Mary passes! Take the bumps and bruises from 2020 and convert them into a winning strategy for 2021.
Gordon Hecht is Senior Regional Manager/Strategic
Retail Group at Serta Simmons Bedding and a regular
contributor to YSN. You can reach him at
ghecht@sertasimmons.com.
