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Holiday Countdown! 6 Critical Questions That Could Make or Break Your Season

Are you ready for the holidays or are you ready for some football? Most people can relate to the second part of that sentence with a big smile and the knowledge that Monday night football games always started with that question. It meant a continuation of the weekend with food in front of the TV and bleary eyes at work the next morning.

But ask people, especially retailers, if they are ready for the holidays and that question is usually followed by a groan or skepticism at best. It’s almost like this season of the year creeps up and catches people by surprise.

I often think that people visiting the US must think we are a strange group of people as they shop in our stores in September and see ghosts and goblins with angels and baby Jesus in the same seasonal aisles of our favorite stores.

Do retailers rush the season? That question has always been up for debate. I believe retailers are gamblers. Many retailers live by the motto of, “I can always pull the year out at the holidays”! That’s like saying I probably can lose weight if I tape my mouth shut but it isn’t very healthy. Neither is waiting till the last quarter of the year hoping that the holiday season will make your registers ring off the wall.

Let me share my six critical questions business owners should be asking themselves about their business, any time of the year!

When I taught college level retail marketing classes, I always required my students to memorize the “6 Rights of Merchandising”. I don’t remember the reference, but I only know I wish I would have developed it. Instead, I share it with you and hope you will learn it as well.

1. The Right Merchandise
Having the “right” merchandise is the foundation of business success. Having the “right” merchandise means that you know your customer’s wants and needs and you buy accordingly. I have consulted with many clients over the years that have a hard time understanding that buying what they like is not necessarily what the customer likes.

Can you describe your average customer in depth? Do you know specifically what they buy, why they buy it, what they like about it, how often they shop, what they would like more of and if you could find it, what one thing would they wish you would carry?

I believe that businesses can exceed sales plans if they would just encourage employees to increase UPT’s, or Units Per Transaction. In order to do that, a business must have merchandise that compliments each other. Rarely should a customer ever leave your business after purchasing only one item. If an employee is sharp, they can anticipate another item that the customer could use, if they just think about it.

If a customer buys a

• Dress shirt… then how about ties, cuff links, sport shirt
• Shoes…then how about socks, hose, handbag, leather protectant
• Luggage…then how about travel alarm clock, ID tags, jewelry cases
• Golf shoes…then how about golf balls, golf shirt, golf glove

I know these sounds elementary but how many times have you come to a check out and the employee says the new “line”, “Did you find everything OK?” I really shocked my local grocery store person and responded, “Why, did you lose something?” If the employee is sharp, they can glance at what the customer is purchasing and make a quick recommendation of something the customer might have missed.

I remember purchasing a smoke detector at a big box home store and the employee said, “Do you have the 9V batteries to go with that? Duh…you mean they don’t put those in the box? You know I added those to the sale!

2. The Right Time
You’ve heard it said that timing is everything, and itis so important in retail. Most retailers will agree that managing their ordering and receiving process is critical to a successful business. Dealing with late shipping, incomplete orders or even cancelled orders can have a huge effect on the appearance of inventory in a store. These delivery challenges can result in customers complaining that what they came to buy was not in stock.

Customers are now more aware than ever as to what the newest, hottest items are and who does or does not carry them. They also know that if you don’t carry them, they are only a “Google” away from finding it elsewhere.

Timing is everything when it comes to the wants and needs of your customers.

3. The Right Quantity
Have you ever heard the quote, “Don’t go shopping when you’re hungry?” There is truth in that statement when it comes to buying merchandise. Just like we are apt to over buy at the grocery store when we are hungry, the same is true when we go to market without a plan, and shopping “hungry” If you add over eager vendors to the equation you will find yourself overstocked with something you ordinarily would have never purchased. Having the right merchandise at the right time and in the right quantity should be part of a well constructed buying plan.

Part of the fascinating job of buying merchandise for a store is testing new merchandise. Some customer’s want the newest, cutting edge items and are even willing to pay “full price”, heaven forbid, for them. The talent of a good buyer is knowing how much to buy initially as well as what are the re-order options in case the item is a huge success. It really is, “all in the numbers”.

4. The Right Price
So much emphasis is placed on pricing in the market place. I believe that if the customer sees “need and value” the price is secondary. If a customer is looking to buy a Mercedes-Benz car, I highly doubt if they care whether or not it is “on sale”. They are buying a perceived “value”. If a customer is buying a fine wine, the taste and perception will probably precede the price of the wine.

Now you may not be selling cars or wine but there is a pricing lesson here. I have always taught clients that their businesses should have three “types” of goods within their inventory; basic goods, fashion goods and promotional goods. Basic goods are your bread and butter items. They are the items you sell everyday. They are the items the customer comes into your store looking for. The pricing on these items needs to be competitive but not necessarily “on sale”. Some companies call these items, “value priced”. They are items that the customer needs, sees value in and believes that the pricing is fair. The next classification is fashion goods. These items are unique items that the customer may not see elsewhere. They are usually stocked in smaller quantities and because they are unique, the retailer should opt for a higher mark-up on these items. A regular customer may not choose to buy the “fashion goods” on a regular basis, but they know that the retailer is savvy enough to carry unusual and trendy merchandise.

The last classification is promotional goods. Customers will always want a deal. Retailers have to “buy” for promotions and not assume that their sale items will come from items that were a “bad buy”. The customer appreciates when the “basic goods” they buy on a daily basis are on sale once in a while.

The retailer is successful when the customer comes in and buys a regular “basic item” and just has to have a “fashion item” and then sees a “promotional item” and adds that to the final purchase. If the merchandise had been purchased wisely and the pricing has been well thought out, the final sale of all three of these items to the customer should provide a nice profit.

5. The Right Location
I will go a step further and say that the right merchandising will help sell your merchandise. Visual displays can be your silent salesperson. Do you change your visual displays frequently? Do you know what your sales per square foot are and does your best selling merchandise command the prime real estate in your store? Is your signing inviting and informative? Do you have enough lighting to attractively highlight the merchandise? Is your merchandise stocked in such a way to say to the customer, “we are in business” or does your inventory look as though you are waiting daily for new shipments to arrive?

6. The Right Salesperson
So far you know you have the right merchandise, at the right time, in the right quantity, at the right price and in the right location, but do you have the right people selling it for you? I would suggest you look at everyone who works for you and ask yourself this simple question, “Would I want them working for my competition?” This isn’t a joke, it is a fact. If your employees are knowledgeable, friendly, trusting and responsible, you wouldn’t want them working for anyone else but you. It is sad that you can work so hard on areas 1-5, but if the customer is turned off by #6, you just lost precious business.

Customers will shop in your store this holiday season. The customer will make a mental report card of their experience. Did you have the merchandise they were looking for? Did you have the merchandise when they wanted it? Did you have the right size or right amount they needed? Did they feel your pricing was fair? Were they able to easily find what they were looking for? But most of all, they will remember what their experience was like when they traded their hard-earned money for something of value, your merchandise. That experience will come down to the last few minutes they spend with an employee and the relationships that will make them say, “I need to continue doing business here all year long!”

Offer customers what they want, when they want it in the quantity they want and at the price they want and wrap it up by a knowledgeable, caring employee and you’ll have a customer for life.

Are you ready for the holidays? You bet you are, bring on 2006!

Anne M. Obarski is The “Eye” on Performance!” As a professional speaker and trainer, Anne will work with your company to provide you with the clues to keep your customers coming back. Anne presents keynotes, break-out sessions and customized training, nationwide, in the area of customer service. You’ll want her two new books, “Surprising Secrets of Mystery Shoppers” and “Real World Customer Service Strategies That Work” and her newest book, “Conversations on Sales and Customer Service” also featuring sales guru, Brian Tracy For more info go to: http://www.merchandiseconcepts.com or email Anne at anne@merchandiseconcepts.com.