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Cooking up a Retail Success
Today you are taking a different look inside the front door of your business. For years, having a coffee pot, television set, two or three chairs, and a coffee table with a few magazines that are somewhere less than two years old has been just fine. The counter at the back has always been kept clean, and there are a couple of bar stools so that the customer can sit down while you take care of the details of a new or renewing contract.
But in the last year, you have read several articles in Messenger that have gotten your attention. The stories are the experiences of your fellow dealers that have taken their customer service area - some with less and some with more square footage - and turned it from a waiting room into a profit filled room.
This is the day when you decide you are going to get serious about your customer service area and all the square footage it occupies. But how do you go about this transition? And how can we minimize the cost of the mistakes that every business experiences?
The first step is to decide what you are going to sell to your customers. You can gain this most valuable information in a couple of ways. One is to ask a customer signing a new contract what last minute supplies they are needing as they move their possessions. The second way is to walk around your facility and observe people that are moving things in or out of their storage space. Be sure to consider the non- traditional items such as colas, snacks, extension cords, and batteries. And if you rent space for boats, trailers and RV's, the list could be very sizable. From the list you compile, you want to consider these questions. How many of this can I sell? What will the profit be? Who else is selling this product? And what is the going price for that item?
As we look at the space we are about to turn into a small store, we need to be sure we have plenty of light. An easy way to find out how much is to take an old photographer's light meter and visit many of the stores in a mall or shopping center. How much light do these businesses have? We need to at least match this amount as well lit merchandise sells better. If you are adding light, try recessed lighting as the higher the ceiling in this room, the bigger it will appear. And while we are trying to make the room look bigger, let's paint those walls a light color - a silver or cream would look great.
In designing the layout of the sales floor, we want to keep two things in mind. The first is that your service counter should be at the rear of the area, positioned so that customers have to walk past all of your merchandise to get to the counter. The second point is that people walking into a business have a natural tendency to look and walk to the right. Placing the merchandise that we want the customers to first see, and perhaps the merchandise that we make the most money with, should be placed in this area. There also needs to be a clearly defined main aisle. Customers want to be led into a business, not left to having to figure out where to walk.
As your business is one that customers do not traditionally think as being a retail location, if you have windows, do not clutter them with signs. Instead keep them clean and carefully consider the merchandise that a customer can see through those windows. When they drive up or walk by, you want them to think there is a store they can go into, and not just the manager's office.
As you select counters to put the merchandise on, you want a consistent look to the type of fixturing you use. There are many businesses that sell new and used store display equipment. The base of the counter should be as narrow as the merchandise you select can possibly tolerate. The wider the base of the counters, the less space you have for aisles and other counters. The counters that are placed against the walls need to be as tall as possible, up to about 8 feet in height. Even though we have just painted the walls, you need to remember that merchandise on a shelf or peg hook will sell - blank walls do not.
As a customer walks into your store/office, there are many ways that we can influence their buying decisions. This is important as research has shown that two out of three customers do not have their mind made up about what they are going to buy when they walk in the door. With this large amount of indecision, we can make a difference in what they will purchase and how much they will purchase.
Let's take a look at a baker's dozen ways we can make the merchandise you are selling, have a better chance of increasing your bottom line.
The first idea for better visual merchandising deals with the area just inside the front door. In the grocery business, they refer to it as a lobby. The customer needs a small amount of space to be able to stand, look around, and then decide which direction they want to travel through your sales floor. This is also why we want those tall fixtures on the exterior walls. Tall counters may be fine in a warehouse store, but not in a small business.
This lobby idea easily relates to the second idea. Once the customer has surveyed your business, they are most likely to want to travel to the right - much like the way we drive cars. The merchandise they see immediately should be the most appealing. We will look at the idea of basic, add-on, and impulse merchandise later on.
As the customer is traveling down that initial aisle, we will introduce the third idea which is designing your aisles so that your customer can easily see all of the merchandise you sell. Your chances of them seeing everything is enhanced by your making sure that when they reach the end of the aisle, there is at least one, and preferably two choices of direction for them to choose next.
If their only choice is to instead turn around, and pass the merchandise they have already seen, the customer is more likely to never enter the aisle at all. This is especially true if there is already one customer in that aisle. When we shop, we all like to have our own personal space and having options at the end of the aisle allow us to better enjoy our personal space.
Idea number four is to place your "drawing card" at the back of the sales floor. You have probably already done a lot of this by having your counter at the back. What else are they most likely to look for? If you sell snacks and drinks, these would be likely candidates. If you had a grocery store, these items would be bread, milk, eggs, and meat. In the grocery store you will find these on the exterior walls near the back. This is so that you will have to see all of the other merchandise they sell in a grocery store. After you have sold merchandise for a few months, you will probably see what your customers have established as your "drawing card" items.
The fifth idea we are sharing with you is that of thinking ahead. If you rent a trailer for your customers to move their belongings, August is a great time to begin to remind them to schedule their need for your trailer to move their Christmas decorations in November. You will find by placing the thought about their Christmas needs in their minds in August, that you will actually increase your trailer rentals.
Department stores have always done a great job of showing winter coats in the summer as a way to tell their customers that their store is the place to visit when the customer decides to make their purchase at the beginning of the winter.
Our sixth point deals with finding that magic button that gets a customer to buy. Most all of us have five senses - see, touch, smell, taste and hearing. What we want to do is make contact with as many of these as possible so that we can enhance our chances of selling products. While sight is covered by our other ideas, there are several ways of touching the other four senses. Playing light jazz music has been shown to be the type of music that is most appealing to all people. You could take care of smell and taste using this unique method we have seen. One business invested in an Otis Spunkmeyer cookie shop and offers many varieties of fresh baked cookies at 3 for $1.00. There is a handsome profit in that price, and now customers are returning just to buy cookies on a regular basis.
The seventh idea is that merchandise should be colorized where possible. As an example, if you sell gray duct tape, you will be surprised at how many people will want to purchase the other various colors the tape is available in. If you explain to them that this is a way of color coding their possessions, your sales of items can increase.
As we decide where to place the items on the shelves of your new store, the eighth idea comes into play. Items that relate to each other should be placed together. The drinks are near the snacks. And as you sell boxes, the tape and markers should be nearby. With your staff, you should be explaining that this nearby placement is so that they can easily make a sale. When the customer asks for a box, your staff should be saying, "Do you have plenty of tape? How about your marker? Is it all dried out?"
When you get the customer to stop and think a moment about what they have, any doubt usually results in a sale as the customer does not want to have to make a second trip.
The ninth idea is related to this as we suggest that many items should have at least two locations. While you place related items near each other, many items relate to more than one other product. And by having multiple locations you increase your chance of making that add-on sale to the customer.
Idea number ten deals with impulse sales. Ever see a display of batteries near the checkout at a hardware store, grocery or convenience store? They are placed there because people always need batteries. The same technique will work for you.
Our eleventh idea is the concept of attractive displays. The problem with many displays is that they have an unattractive back side. If this is so, the display needs to be on an exterior wall, or be backed up to a similar display.
When people walk into your business, they usually have one thing on their mind - see the person at the counter about something. Buying merchandise is often the last thought on their mind. But when their dealings with the person at the counter are complete, and they turn around, their mind becomes open to seeing the merchandise. The question from idea number eleven is, "Are you merchandising your store from front to back, and back to front?"
Ideas number twelve and thirteen work together. The ideal selling space is a vertical area at least 4 feet above the floor and no more than 6 1/2 feet above the floor. This is "eye level" for your customer, and you want to place the items you want to sell in that space. Likewise, if you sell whole goods and their accessories, you want the whole goods in this "eye space" and the accessories placed below it. Customers will ask for the accessories, you want them to see the whole goods.
We promised a baker's dozen of ideas, but there is one more. This is intentional, because just like your dealing with your customers, you should always give more than what is expected.
The fourteenth idea deals with signs. Simply said, signs get people to buy. And the message on the sign needs to tell the benefits of the product. The adage is, "Features tell, but benefits sell". If the sign says, "buy a halogen flashlight with alkaline batteries", those are the features. But the customer doesn't understand the benefits. If you explain that a halogen flashlight shines brighter and that alkaline batteries last longer, then the customer knows why they want those benefits.
Put these fourteen ideas together, and we have cooked up a pretty good recipe for selling merchandise in your store.
Oh yes, and that television set, chairs and old magazines that you had before we started? They need to go away. After all, this is now a business selling merchandise - not a waiting room!
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This article is copyrighted by Tom Shay and Profits Plus Solutions, who can be reached at: PO Box 1577, St. Petersburg, Fl. 33731. Phone 727-464-2182. It may be printed for an individual to read, but not duplicated or distributed without expressed written consent of the copyright owner.
Profits Plus Solutions, Inc.