Have a happy retail Christmas! Beware of Boxing Day

It's that time of the year when many retailers are rushed off their feet. I know my traditional readership falls at this time because people are too busy. I wanted to take this opportunity to say Happy Christmas to all of those that follow me. I know that my readers consist of independent retailers and people who work for bigger companies. This short blog today is going to be about the current debate on Boxing Day opening.

I have worked in retail for a long time and I know how tough it can be at this time of the year. Often the most important people in a store only get a day off at Christmas as they are needed on Christmas Eve and Boxing Day. This is far too much pressure with the pay to match.

I know of many good retail managers that will look after their people. Most workers will get some time off over Christmas or the New Year period if it can be worked properly. I completely sympathise with all of the people that are signing the petition to stop retailers from opening on Boxing Day. I can honestly see a huge amount of sense in it but in my eyes it does not solve a problem. There are so many people from different industries that have to work on Christmas Eve, Christmas Day and Boxing Day at all timed of the day and night that it is impractical to take one part of one industry and exclude it. If the shops were not open then people would shop online and then the pickers and delivery staff would be working anyway. There are no real winners here.

Healthcare, hospitality and taxi drivers are some of the many people that work on these days. Retail staff cannot be made an exception.

So what can be done?

I have worked with many retailers who try to make this as fair as possible. In the places I have worked with in the past it was either done on a 'year-on, year-off' basis or worked that it was voluntary where possible. Some (particularly those with older contracts)  are rewarded with higher pay rates on these days and are happier to come in as a result. Take a look at what might work for you.

As I said, this is only a short blog and a chance to say 'Happy Christmas.' I think that there will only be one more blog before Christmas so if I don't see you again have a good one. Here's to a fantastic retail 2017.

See why you shouldn't manage your retail shop in the style of Jose Mourinho

There are real lessons to be learnt from the tenure and sacking of Jose Mourinho at Chelsea. His second stint in charge of the club finally came to an end yesterday, after weeks of speculation. It's always difficult to totally understand why someone loses their job when you view it from the outside. Like most businesses, football is a results-driven business so it's on the field that makes the difference. But there has been a continual message from Mourinho this season. It has undermined his own position. There's a common phrase bandied around in situations like this -"he lost the changing room." It means that the players (or at least some of them) stopped playing at 100% for him. When this is one or two from a squad of around thirty players then it's easy to not pick them. If this spreads and significant players stop pulling their weight then it's a major problem.

Mourinho very publicly chastised the medical team early in the season as this caused immediate disharmony. He has since hung his players out to dry on more than one occasion. Whether this caused the rift with the dressing room or exacerbated it isn't clear but there was most definitely a rift.

What does this mean for me?

Well, as a retail manager and leader of people, you need to be vary of the Mourinho effect. It's by having your team on board with your message and your vision that gets the team working for you. This doesn't mean that you never discipline them, just that you never hang them out to dry.

And it's by having this vision and explaining it, reinforcing it, singing it's praises and celebrating it's successes that your team know where you are all going.

Did Jose Mourinho have a lack of vision? Maybe not but I think his communication of the vision became garbled and this can lose the team just as easily. He went from proclaiming his team to chastising them, from stating he was building a dynasty to talk or only staying for a few years. It's this lack of consistency that also undermined his authority. I use the word authority to mean something different to just power or bring in charge. Authority as a leader includes having people listen to you, understand what you  say and respond with their actions.

If your team don't know how to respond because what you are saying contradicts your overall vision (or what you said last week) then you lose credibility.

So overall you need to remember to-

• Have a vision
• Communicate your vision
• Keep communication levels up
• Be consistent

It will help you all to achieve your goals. Start by thinking about what your vision is for your team and take it from there.

Read how one garden centre bucks the trend and gives lesson for us all

I'm currently out shopping at one of my least favourite retail destinations - the garden centre. I find that they so often get so much wrong and it frustrates me. They are a retailer that doesn't have the traditional problem of lack of space. They have the problem of too much space snd tend to try to solve the problem by filling the space with anything and everything. I wrote about this in this is a previous blog-

http://mytimeinretail.blogspot.com/2015/11/see-why-entrance-to-your-retail-store.html

The garden centre I'm visiting today is a little different, if only at this time of the year. The front half of the garden centre has been transformed into a Christmas shop. It's full of colourful tinsel, glowing decorations and happy people. If if the customers aren't there to buy Christmas decorations they are there to look around. They car park is full, the café is full and the customers are mingling, talking and generally enjoying themselves.

As with all my blogs, I look at the success and failure of others to see how it can transform things for all of us. I think that a large part of retail is looking at how others operate and applying that to our own business. In this case, it may not just be Christmas that is the winning formula but how it is approached. I spoke in the last blog about garden centres on the need for making the front of the shop something to shout about. And this garden centre has done just that.

The message here us to carry out anything that you do as though you really mean it. Having this Christmas shop has made the garden centre a destination. Like Fenwick's Christmas window in Newcastle, it has become part of some people's Christmas tradition. This makes you a winner straight away because customers will walk through the door as a matter of course.

Think about your own shopping trips. There will be stores in certain towns or cities that you will walk into and look around out of habit. You may not be looking for anything in that category but go in there anyway. It may be their coffee shop, the fact that they have different things every time you go in or their displays. You need to find your reason for shoppers to visit and make the most of it.

Think long and hard about what you do, what you want to be known for and then work hard with your team and your marketing to make this happen.

See how to turn the plastic bag charge to your benefit

We are now a month on from the start if the charge for plastic bags in shops in England.

http://www.bbc.co.uk/news/uk-34346309

As people start to settle into the routine of bringing their own bag or paying, it's worth taking a look at the charge and seeing how it works and how it can work for you. There are quite a few exclusions to the plastic bag levy and some may apply to your business-

https://www.gov.uk/guidance/carrier-bag-charges-retailers-responsibilities#bags-you-dont-have-to-charge-for

A main area that you don't have to charge is if you employ less than 250 full-time employees.

Many of my readers are small independent retailers but the exclusion doesn't mean that you can't charge for bags - it means that you don't have to. I think that a large part of the charge is to educate customers to the dangers of disposable carrier bags so a small retailer can be as much a part of this education as a large one. Customers won't necessarily know which shops have to charge and which shops are exempt. So this is your opportunity to help a charity of your choice by charging for bags and donating the proceeds to them. If it's communicated in the right way then your customers will feel positive about the charge rather than negative.

Your alternative is to advertise that you are one of the retailers that don't (have to) charge for bags. It feels like a strange strategy but it could give you a small competitive advantage as bag charge fatigue sets in.

And it's by looking at your structure when changes like this happen that helps you assess your business plans. Having plans set out for your business and regularly assessing them keeps you on track. I suggest that you set out business plans annually, reassess quarterly and monitor progress monthly. Changes to legislation, the trading landscape or your competition will prompt a further review and assessment. As a business, you will need to know where you are and where you are going. Getting to grips with it all can transform what you do.

In my next blog I'll take a more detailed look at business planning.

See the lessons to be learnt from this week's The Apprentice

I've started watching this series of The Apprentice (against my better judgement) this week. The tasks are interesting, helped by the editing, and the characters are as comical as they have been for the past few series. I applied for the last series of the programme and got through to the audition process - the final few hundred from twenty-something thousand applicants I was told. The opportunity at the end of the process has far more value than the process itself.

The first task was a buying and selling task - go to the market and buy fish, turn it into products and then sell it in the city of London. One team made a profit of £1.87. And this is where the whole process falls down. If this were real business then there would be much more expense to take away from their paltry £1.87 profit-

Wages for eight team members

Production costs

They were given use of a facility to turn their raw fish into saleable products, and this also took energy for the machinery, cookers and lights.

A trading licence to sell food on the street

Purchase or hire if the stall

Hire or purchase of the cooking equipment

All in all, these tasks in isolation mean very little. I'd prefer to see a programme where the team develops a business over the course of the series. Given an amount of money st the start, they have to buy and sell cleverly to increase their money for the following week's task. Lord Sugar can still fire someone every week, but the team can work their way through.

So what's this got to do with me an independent retailer?

Well control of costs underpins every single business. And it's by looking at your costs and the effectiveness of every penny you spend that will allow you to succeed. And for every pound you save, you have three choices - pocket and extra pound of profit, reinvest another pound into area you know succeed or cut your customers prices by another pound.

Looking at all of your expenditure to ensure that it works as hard as you do is a fundamental part of running a business. I'd suggest three ways of ensuring you get this as right as you can.

Regular reviews of your costs

I'd suggest that you look at your expenditure and conduct a full review on a regular basis. Annually at least, every 6 months is better and in some instances quarterly. This ensures that things never get away from you. Having your finger on the cost pulse means that you never get to the point where you look back and think "where has all that money gone?" To be able to look at all the outgoings and see if savings can be made will work out for you in the long run. Going hand-in-hand with this is the expenditure on marketing.

Analysing the success of your marketing spend

If you take nothing else from reading this blog, then take this one piece of information with you. You need to account for what you spend. By this I mean that when you set out a marketing campaign, you need to have an idea of what business that campaign brings. To do this you have to speak to your customer at the first point of contact. It's from there that you will understand how they arrived with you.

For example, you spend £200 per month on advertising on a particular website and £100 per month on newspaper advertising. If the website brings you £2,000 in sales per month then it earns 10 times the spend. If the newspaper brings you £500 per month in sales then it earns 5 times the spend.

You will see that the website is twice as profitable in terms of marketing spend than the newspaper.

Speaking to people when the opportunity arises

I know that it's impossible to respond to every marketing call or email but there will be areas in which it's profitable to listen to people. The areas in which you want to talk to people will be dictated in part by the areas above. If you have identified an area in your cost review then this will prompt you talking to someone who contacts you. If you have an area of marketing success, then you'll want to be able to repeat this success. And in some areas you will just see an idea that you like and decide to investigate.

Avoid being an overspender like the contestants on The Apprentice and have control over your costs.

Read how retail is more positive than negative

I was looking for a little inspiration for today's blog and I decided to google "retail problems" to see if there was anything there to prompt me. I kind of wish I hadnt. There are hundreds of links such as this one-

http://www.buzzfeed.com/daves4/the-most-soul-crushing-things-about-working-retail#.xtRbJeez1L

And they are all about the bad things about working in retail, the bad things about customers and how bad things are. I'd like to think that my blog over the years gives the opposite view to this. I've looked at how retail can be looked at and found to be interesting for those working in it. The fascination of retail for me can be looked at in so many different ways but I'll have a look at some here-

Every day is different

There are do many industries that I've heard this said about but nowhere is it as true as I'm retail. Every single day brings in a new challenge, a new question, a new customer or a new idea. The dynamic nature of retail is what makes it engaging and keeps people interested and coming back for more. New ideas from those in charge make change management a massive part of retail and will ensure that it continues to be a dynamic work environment.

Interaction with people

Linked to the above, it's the constant flow of new customers that go some way to making each day different. This is amplified if you are a niche or speciality retailer as you will have to spend more time with each new customer as you explain your offering to them. And for me, this is where it can get really interesting. The opportunity to spend quality time with customers (new or old) transforms the day. It's what turns the mundane into the extraordinary as you get to build what you hope and expect to be long-term relationship with your customers.

The team aspect

It's being part of a team that are (usually) all pulling in the same direction that is another aspect of retail that I really enjoy. I know that it's not the only industry in which you work as part of a team but the team bond always feels stronger in retail than anywhere else I've worked. The fact that we're all in it together and the goals are shared means that we share a bond and every action that one of us takes affects all the others. This can have negative consequences but more often than not, means that everyone does what is in the best interests of the customers and their colleagues. 

Payday weekend bonanza with Bank Holiday thrown in as well!

Is bonanza time for most retailers this weekend as we have the weekend, it's a payday weekend and it's a bank holiday weekend. And I can see many times and retailers making the most of it. There are offers, events, fairs and all sorts of things happening all over the country as retailers try to compete with other attractions for people's time and money this weekend.

The national chains seem to have set themselves up for a big weekend, so it's time for the small independent retailers  that make up much of my audience to up their game.

As I've said many times before in my blog, the first step on the road to payday weekend success of planning your staffing. With me being away for three weeks and forcing myself to stay off the internet I haven't blogged this early enough but there are always lessons to be learnt and this will stand you in good stead for all payday weekends, bank holiday weekends and other events throughout the year. Once you have your staffing sorted, it's time to look at how you can offer something different and special at this time. I've already stated that you will not just be competing with other retailers but other attractions on a weekend like this. Giving families a reason to visit you rather than a park, a museum, a theme park or the seaside is part of ensuring success. So I'd say having something exciting for the children is a great idea for this weekend. What you do may well depend on what type of retailer you are, but be imaginative and think about what can keep families in your store for longer.

It's also a god idea to ensure that any offers you run coincide with a weekend such as this. If you are planning a sale, a but one get one free or other promotion them starting it this weekend is a great idea. It gets people through your door that may not normally shop with you and give you a chance to convert then into loyal customers. It will also give you a chance to cement your relationship with your existing customers who may need a little push to spend more with you.

The final piece in the jigsaw as far as I'm concerned is to make sure that your team are motivated and enthused about the weekend trade and any event you are hosting. Get them involved in the ideas process and you will get their buy-in for the event itself. If it's fun for staff and for customers then you've probably got a winning formula.

Keep this blog entry and re-read every time there's an event coming up - you'll be amazed at how useful it can be!

NOT EVERYTHING CAN BE BOUGHT ON THE HIGH STREET

Celebration of my 100th Retail blog entry!

It's now reached 100 blog entries for "My Time In  Retail - Where The High Street Goes From Here." To celebrate I will be taking a look back at the first 100 entries and some of the themes that have been developed over the last 100 blogs.

This current entry is number 101, and is a short piece to explain what you will find over the next 3 or 4 blogs from me.

I'll take a look at ongoing themes from the blog and how they knot together into a coherent (hopefully) series that gives retailers everywhere the benefit of my many, many years of experience in working in shops and on the High Street.

I'm looking forward to the next few blog entries - I hope that you are as well!

A return from holiday leaves me needing a catch-up

I've now returned from three weeks holiday. A three week break brings lots of thinking time but the return to reality and activity is tougher than I remember.

I've kept physically active whilst away, with a gym and swimming pool on the complex I've been staying on. But a lot of time on the road, by the pool, in the gym and on the beach gives you plenty of time to think about what you are doing and where you want to start going next with everything you do.

I think that it is good (and it was good) to have a period of reflection and contemplation. It gives you a chance to determine whether you think that you're on the right track and to plot the way forward without the everyday distractions of work life. It also enables a little "blue sky thinking" as there exposure to a different routine and a different culture can have you thinking about things in different ways. I have looked at the direction I'm heading in and I broadly think that it's where I want to be going.

It's now thinking about heading out of the break and back into my life that's occupying my mind. I landed and got home in Sunday evening and it was back to work at 7.30am on Monday, so there was no real transition to be had. It was a case of holiday mode as is went to bed and work mode when I got up the next morning. It was just the way it had to be with three weeks off - there was no spare time to be had! So it was straight back into it, which can sometimes be the best way to get on, although I don't really feel like that the the moment! I can just about see the wood from the trees at work now, after a few days of catching up. I just wish I could say the same about everything else I do.

It's getting back into the swing of things for everyone concerned at the moment. The Summer customer flow is very different to the flow during the rest of the year, especially in a university city, such as the City of Durham that I work in regularly. So it's been a time where large parts of the city have been on holiday and where large parts if the city are starting to get back into a routine for Back To School promotions, the kids actually returning to school and the university students returning to the city.

I've been doing some work with a pharmacy in the city recently and all their work is geared to the students returning and the ailments beginning, especially when the weather turns cold. The start of term can't come quickly enough for them and their largest customer base starts getting ill not long after returning.

It's interesting to note where your largest customer groups are and how the ebb and flow to be able to plan out your staffing, stock and things such as opening hours. I've mentioned in my blog many times about organisation, and this is adding another level to your understanding of what goes on.

NOT EVERYTHING CAN BE FOUND ON THE HIGH STREET

Do organisations have an obligation to people other than their shareholders?

I ask this question because, as I grow older, read more about the world and experience life with more and more organisations I see things that perhaps I hadn't seen before.

I've recently read the autobiography of Mahatma Gandhi and one of the  overwhelming themes was living on what you need to get by.

I would put it to you that many, many multinational organisations gather in vastly more resources than they need and yet their staff at the bottom level struggle to exist on the minimum wage. The question emerges - do the leaders of the organisation at the top have more of an obligation to look after their employees (higher wages, more annual leave and better benefits) than their obligation to their shareholders (lower costs, greater profit and better dividends)?

And it's not just with wages that I feel organisations need to look at their obligations. I read this article yesterday with some interest-

http://www.independent.co.uk/news/business/news/boots-to-cut-700-office-jobs-in-the-uk-10305508.html?origin=internalSearch

A genuine "restructure" where a company redeploys it's resources into different parts of the business for commercial reasons makes sense. Adapting the online offering, moving people from traditional marketing to the social media team or moving people from one store to another to react to customer demand all make sense.

The euphemistic restructuring that companies use as a buzzword now means job cuts and a drive to reduce the overheads a business faces - at the detriment of the workers who lose jobs, have hours cut, have to relocate, are under-employed or don't deal with the change very well, sometimes because they aren't supported through this change by the organisation that brought it about.

Again, it begs the question of where the company's priority obligation lies.

I've often thought that there are enough people in the UK that believe in equality and fairness and they could be mobilised to buy shares in a company and apply pressure on the policies that the company has, in terms of salaries, environmtal considerations and ethical business practices.

Opinion, even fact, can be best judged by debate in retail

I am firmly of the belief that reading expands the mind, and I generally get something out if every book I read. I've just finished a short book on the Cuban Missile Crisis. It's called Thirteen Days and was written by Robert F. Kennedy. The book itself is quite factual and it isn't until I reached the conclusions after the crisis was over that I thought of practical applications towards business. In the chapter "Some of the things we learned..." Robert Kennedy stated that he felt it of significant importance during the crisis that there were different points of view throughout the process. The group of people that sat together to deliberate and report back to the President (the ex comm group) had people from different backgrounds and had different ideas on how to handle the crisis. Robert Kennedy believes that from this group, the right decisions and course of action was achieved because "opinion, even fact, can be best judged by conflict, by debate." He even goes so far as to say that this lack of conflict was part of the failure of an earlier Kennedy administration operation in Cuba - the Bay of Pigs invasion.

In terms of the way this can bring about lessons for business for me, is as far as business decisions are made. Too often one part if the business makes decisions that affect other parts of the business without consulting them. Taking the time to have different viewpoints and for this to provide the opportunity for the decision to be debated can only be healthy. I liken this to the coalition government we have had in this country for nearly the last five years. Although we don't 100% what has happened behind the closed doors of government, it appears from the outside that each party have had to agree on policy. In many cases this has resulted in policy being adapted to keep both parties happy - and for the common good of the country.

The book also reminds me of another book I read fairly recently, called Why Your Boss Is Programmed to Be a Dictator: A Book for Anyone Who Has a Boss or Is a Boss by Chetan Dhruve. It's well worth a read and in one chapter he tells about the mistakes made in the run up to the invasion of Iraq because the military's advisers told their boss (President George W. Bush) what they thought he wanted to hear. More debate would probably have resulted in a different course of action and many fewer lives lost.

Lessons for retail in my eyes will include a level of store representation in head office decisions that affect stores for larger organisations. These decisions may have implications for stores that weren't envisaged but someone from store level can ask these questions and point out these potential issues. This will also have the added advantages that the walls between stores and head office are broken down and that stores have a buy-in involvement in the process.

For smaller retailers, as I know many of my readers are, it can mean involving all of your team and ideally some of your customers in the decision making process. Having this discussion and listening to any dissenting voices before finalising a decision can help you to think of the things you may have missed in your own and to refine the decision so it works best for your team and customers alike.


Not everything can be bought on the High Street

They say retail is detail - I often disagree

In my many years working in retail I've often heard the mantra retail is detail. Now in small local retailers, particularly when it's not a fast moving product or products, then this CAN be true - details can make a difference. In large retailers, discount retailers, supermarkets, corner shops, convenience stores, newspaper shops and the majority of clothing retailers then retail is not detail. In these case, retail is about being 90% at most-

90% of your customers served quickly

90% of your products available

90% of your customers asked if they have your loyalty card

90% staff attendance

And the list could go on.

So not very detailed then.

Don't be downhearted, though, because this 90% isn't an horrific figure. On one hand it's probably as much as your competition is managing. On the other hand it still gives room for improvement.

Now to get up towards 100% will take investment. Better wages to get better staff attendance, more staff to keep queues down, more staff and more stock holding to keep availability up, etc.

So the next step would be to ask the question -"what type of retailer do I want to be?"

One that keeps 90% of customers happy? Or do I want to spend a little more?

If you're a small, local, self-managed retailer then is suggest aiming for the 100%. It's being different that will get you noticed. It's really hard to try to compete on price, especially against national or multinational organisations that are bound to have much deeper pockets than you. Providing better service, a better experience at a higher price point is letting your customers know that you are different, you are better.

If you're a large multi-site retailer and you can't be at every site, every day, all day then 90% isn't a bad starting point. You can push your team on from there, starting with the store managers. Motivate them and watch this motivation filter down to the customer-facing team members.

How do you reward your high flyers?

It struck me again this week something that has come to me time and time again during my time in retail. It's a question of reward.

Now if you're an entrepreneur, a single shop owner (as I hope many if my readers are) then don't start to worth at the word reward. The reward I'm putting forward as the most valuable is one that costs you nothing but time.

It's the simple "well done" or "thank you" and it's worth it's weight in gold. I witnessed this week a team member being told that their work was "awesome" and their area "had never looked so good." These comments had that team member bouncing all day and their work improve de enmity than the "awesome" level that had been achieved earlier in the week.

It's comments such as the "well done" or "thank you" put into your own words that make a huge difference to your team. I was a store manager a long time ago and it was part of the daily routine to thank every team member at the end of every day. The store doubled it's sales in a 12 month period. Now there were other factors at play here, but a team feeling recognised and valued were part of the motivation that enabled them to enact the other changes that made us successful. If the team were not feeling valued, they may not have been as receptive to other ideas.

It seems so basic, to talk to your team at every opportunity, but it's so often missed. I've worked in retail organisations where the store management team are hardly seen. They are office managers, who occasionally have to leave their office to pass out a task to a team member but spend the vast majority of their time cooped up in an office carrying out administration tasks or even less. In this experience, the team self-manage and tend to get the tasks done that they want to do, and some if the less favoured tasks just don't get done. It's a huge leap of faith to have in your team, to leave then to their own devices, and not one i'd take. I always want to have contact with my team and customers and I want an employer that empowers me to do that.

Have you started the year with a bang?

Calling all retailers - 2015 has started and those selling off all their unsold Christmas products have started with somewhat of a bang. Footfall has been good, the weather has been kind and opening hours have attracted a lot of bargain hunters, in store and moreso online.

Don't dismiss online. Remember back to previous blogs where I spoke about click and collect.

http://mytimeinretail.blogspot.com/2014/04/asda-gets-in-on-click-collect-boom.html

I have seen research by an unnamed High Street retailer that the average customer spends approximately a further £8 when they come into store to collect their goods. The value of this is immense.

If you haven't got your act together for 2015 then ensure that you start to think and act straight away. Get your team together and work out what you want to achieve this year, and then build stepping stones if a rinks that will allow you to get there.

Good luck!

What Traditional Estate Agents don't tell you: A guide to getting the most out of selling your home by Steven Thompson http://www.amazon.co.uk/dp/B00I5HOJAM/ref=cm_sw_r_udp_awd_lhuQub1ZH8DHV

Black Friday - are you participating?

In a really crowded marketplace, are you participating in the Black Friday sales bonanza? I think that this event has been created out of nothing relevant to the UK but retailers wanting to shift as many units as possible. Amazon started the trend and it's the big online retailers and multiples that have run with it. The good thing for retailers with the timing of the event is that it coincides with many people's last payday before Christmas, so they are feeling a little flush and many are ready to spend and get a large chunk of their Christmas shopping done.

As a small independent retailer, you have one of two options, in my eyes. You can either roll with it or try to stand against it.  Here's what I mean-

Roll with it

There has become such hype about the event, many independents will feel that they simply have to offer some Black Friday savings or promotions. To get lost in the retail marketplace on such a busy day would be a major trading blow. To compete with Amazon, Tesco and the like, you'll have to box quite clever to find a niche in the marketplace but they exist. I would think that this will be a good strategy for retailers that will see a large footfall passing their door - those in major shopping centres or city centres or those near a Tesco.

Try to stand against it

There is a viewpoint that independents won't be able to price compete on days like this. Independents can offer their own bespoke products and services at their own prices. Next Saturday is Small Business Saturday, and that's when you can get behind a marketing event that is designed just for you.

I'm sure that retailers will take many different stances in relation to this but the one thing I advise is that you measure how successful it has been and learn from it for next year.

Understanding gross margin will drive your business forward

Marks & Spencer unsurprisingly followed other retailers in announcing disappointing results this week and, at least partly, blaming it on the weather-

http://m.bbc.co.uk/news/business-29911371

I have stated before in my blog that retailers have more than one trick up their sleeves and that cold weather doesn't decimate sales.

Marks & Spencer have now seen 13 consecutive drops in clothing sales, so there's much more to this than just a bit of unseasonal weather. The positive news from this is the increase in gross margin on their products.

If this is at too simple a level them forgive me, but gross margin is selling price minus buying cost. When you improve this, it can enable all sorts of changes to your business that you want to happen. Even if total profits are falling, an increase in gross thin means that you are working less hard for you money. If every transaction through the till brings you more profit every time, then it frees up cost for other expenditure or allows you to put money aside a rainy day.

It all boils down to the fact that you make your money from less transactions, less customers and potentially less staff. All of the time-consuming effort that makesyou  money also costs you money.

Looking at this as an entrepreneurs, you need to look at what profit ypu expect to make on every item you sell. I have seen independent clothing retailers have two sets of numbers in their price labels. The first is the price, the second (in a disguised format) is the lowest price they would consider if a customer wanted to haggle over prices or want a discount for multiple purchases. If you know what you want from each product then you know what products are worth the effort if youskr them yourself, or which products are worth the price at the wholesalers.

It is the start of every other calculation you make for your business and a clear understanding of this will drive your business forward.

Unseasonable weather needent mean a huge drip in sales

A short share today - I'm just reading about Next warning that the good weather has hot their sales and cost them a potential £25m in lost profits.

I'd like to point out that Next and other retailers still can make money in good weather as well as bad. They may gave sold off a lot of Summer stock in their last sale but it's unlikely that their customers will have been shopping for swimwear instead of winter coats - the weather hasn't been that good!

Retailers have analysts galore to loom at all sorts of trends from weather to the harvests of the produce they sell, so it's unlikely that the recent good weather will have been totally unpredicted.

The stock that all retailers, especially the local entrepreneurial type I envisage reading this blog, have sat in stockrooms or storage will get its turn when the weather does eventually turns cold (it will, it's the UK.) It's just ensuring that you are ready to trade 100% when this happens.

Stsrt to make sure that you can access this stock at short notice, that it's listed on your main and mobile websites and that it's available now via Click &Collect if not already in store. It's by having these conrngemcies in pomace, and by having great conversations with your customers that you will be in the optim position to reap the rewards when the template is right.

If your retail unit is affected by the weather via what stock you carry, then stay tuned to the medium and long range forecasts, as they can and will give you an indicator of the general trading conditions you are likely to face, and give you pointers on how to react.

Christmas planning should be well under way by now

Christmas is on the way! Didn't anyone tell you? Your planning for Christmas will depend in what type of retailer you are, but the planning stage should be through or almost through by now.

Some retailers see the trade uplift from towards the end of October, whilst others don't see that until December.

Planning takes many forms and needs to cover many areas-

Staffing

Generally retailers will hire temporary staff to assist with the uplift in trade. For me, it's all about looking at your needs from the outset. Not just what hours you want to be covered but the exact nature of the duties you want these temporary staff to carry out. Think about the areas where you will see an uplift in sales, where your existing team will be best used and then you can identify any gaps in your weekly planner.

From this point you can plan extra hours x number of weeks x hourly rate to work out the costings of your extra Christmas staff.

When you are happy with the costings, it's about advertising the vacancy/vacancies whilst you design the recruitment process and timescales.

Advertising

The fact that it's Christmas will be a part of the natural advertising for any retailer - people will arrive at your door looking to buy.  You need to enhance this by your own marketing or advertising. This doesn't have to be expensive - changes to your shop window, your website and your social media presence can have a big impact.

Range

Now I'm probably too late for Christmas 2014 but changes to your range in time for Christmas can and will make a difference to your sales. Gifting and capturing the imagination of someone buying for someone else has become a massive industry. If your range is too static to change this close to Christmas this year then ease consider what you may be able to do in time for next year.

Hope this helps.

Are Tesco set for more pain?

Tesco have issued a second profit warning, the share price has taken a hit and the new chide executive has cancelled his holiday to start a month early.

Are we seeing the fall if the retail giant?

I have made my feelings clear in this blog about Tesco's major failings in respect if their customers. They try to be all things to all men and end up doing none if it well. In the case of the profit warnings, I think that we are seeing stock market tactics and a chief executive that wants to lay a lot if the blame at his predecessors - "look at the mess I inherited" - before a turnaround that looks oh so much better when/if it happens.

We are still seeing it with the banks, where they report trading figures that don't add up to the performance. There are always hundred of millions of pounds put aside for potential future bad debts and misselling claims. For me, this is double accounting, as the bad debts and claims are accounted for in the present but don't happen until the future. At a certan point, the banks won't have these future potential losses to put in their balance sheet and presumably some of the money they have put aside will have to reappear for losses and claims that didn't materialise.

Things aren't always as accounts make then seem

Tesco's next step is to look at their operation and decide where they want to be experts, and where they want to step back from. Offering opticians, pharmacy, tech experts, cafés, mobile phones, etc on top of their wide-ranging food offering is diluting the quality of service and advice they can offer their customers.

Online and 'Click & Collect' can provide answers

Some services Tesco will want to be able to offer in every store, but some have a better foothold online, where the expertise can be pooled and not spread so thinly. Tesco had a functioning website and a reasonably good Click & Collect offering, so these can take the strain of the expertise, whilst try get back to basics in the areas they can lead on in store. Great customer service will never go out if fashion.

20% off Autumn fashion at Amazon

Shop Local is more than just a slogan

Why don't customers in all walks of life choose smaller, independently-owned local businesses to interact with?

Why would you get your coffee fix from a national homogenised chain when there's a local alternative available?

Local companies employ local people, are run by local people who then spend their income locally.  International companies funnel income away from your local area (often in tax avoidance schemes that deprive the UK Treasury of much-needed tax income.). The ethics of major banks, retailers and hospitality companies is regularly brought into question by their mis-selling, corporate governance and tax affairs - so why go global when you can go local?

I would urge all local independent retailers to push this fact in your marketing.

If you are local, live local, send your kids to a local school, spend locally, pay local council tax then you already have an emotional link to the area you are selling your products in and have an empathic link to your local buyers.  You must use this link to forge links with other local businesses and the larger local community.

I would suggest that you source your products from local suppliers wherever possible. If you can supply from your local community then the connection you have with your local community will be much stronger.