Monday, December 5, 2011

What's Going On?

QUESTION: Can you do everything right and still have a lousy year?
I figured out the best way was to increase money coming in was to increase every sale by $5. So, I brought in a few higher priced items, reorganized merchandise, stocked up in the areas working the best and cut back on the stuff that was taking up too much space but not bringing that high of a return. I made aggressive, but doable sales goals and bought according to the goals with a little room for error.

The first three months of the year it was great, as planned. Since April, we've had fewer sales and the summer has never really heated up. I've cancelled, reduced orders where I can but have been playing catch up with invoices for a couple months now. I don't have much room, financially, to maneuver to do anything drastic to increase business and, to be honest, don't know if it will help. Now here comes holidays and I'm starting to really worry. I've cut back on expenses (worked weekends by myself for 7 weeks, cancelled trip to NYC, etc.) and even considered taking a second job on my days off to help bolster my income. Now, I'm resorting to prayer (no joke)!

ANSWER: Your first mistake was to 'resort to prayer'. Honey, this should be priority #1. Every day, all day, for any season, in any state of your shop. How in the world can we predict when a sale is going to happen? We can't. We ALWAYS need Divine Intervention to stay afloat, buy smart, sell smart and keep it rolling.

Here are some other ideas:
Do what it takes to stay open without borrowing too much money to do it.
Swallow your pride and ask some of your neighbors how they are doing.
Call customers and ask honestly why you haven't seen them lately.
Email a coupon or sale event.
Open an eBay store to help during these months. This is better than taking a job as you can still be in the store.

Three years is about the time when these emotions of yours start. Daily business starts to slack, the newness has worn off and customers are not easily impressed anymore. I am happy you are staying on top of the math. Calculating and estimating what it will take to meet goals. This is smart. But when it doesn't happen, it's very disheartening isn't it? If I knew what to do, I wouldn't be whining myself. So the answer to your question is- yes! You can do everything right and have a lousy year because you cannot predict consumer behavior. I think the key is to prepare for these low months because they do and will happen this year and in your 15th year. Every month I also analyze, strategies and try to get ready for what might be the calm before the storm. Sometimes it works, and other times it doesn't. I think the biggest issue (besides the money which is ALWAYS an issue) is your mental state. Try not to freak out. Try not to do anything drastic. Try not to lose sleep. This is retail. As I told my banker once, how in the world does anyone make money in retail when we have to keep spending it?!! Until we brand ourselves and have our products in every store USA, the small, private shops like ours simply need to learn to live on less, pray for more and ride with the tide.

No comments:

Post a Comment