Despite the increasing popularity of e-commerce, retail businesses continue to thrive in Australia and around the world. Many consumers still prefer to visit an actual shop or store to see products up close instead of seeing pictures on their computer screens. It is possible to run a successful retail business if you know what you are doing.
The business model of a retail storefront involves purchasing wholesale goods and then reselling them for a higher price to local customers. Whether the retail business is a large supermarket or small shop, they both basically follow the same business model and management practices.
Below are 7 important principles for running a successful retail business.
Create a Business Plan
Any type of business should originate from a business plan. If you are ever going to get approved for a business loan or commercial lease, you need to show a business plan to the lender or landlord; respectively. They need to know you are a serious business person who knows what they are doing.
The plan should outline the objectives you have for the company and the products or services you plan to see. Information about the market, organizational structure, marketing plans, and financial projections should also be included.
Choose a Good Location
Location is more important than anything when it comes to commercial real estate for a retail storefront. Every retail company wishes to position their stores in a central location where hundreds or even thousands of people will drive by it every day.
If you put your store in some secluded location without a lot of traffic, then you may not get very many customers. The storefront must be in an easily accessible location which is popular and visible for everyone to see.
Purchase Inventory
One of the biggest investments you will make for your retail business is purchasing inventory. After all, you need to fill up your shelves with products for consumers to purchase, right? On top of that, you need to have extra inventory available in storage just in case certain products on your shelves get purchased quickly.
It would be embarrassing for you if customers came into your store and saw empty shelves everywhere. So, keep the shelves stocked always.
Create a Theme
Your retail business should have a theme that clearly shows what your niche market is.
For example, say you want to manage a store which sells clothes. Rather than just selling clothes for all types of people, you could specialize in selling children’s clothes. Turn it into a tagline where people can remember your business for these specific products. Remain consistent in your brand colours and logo too.
Quality Management
Quality management is the key to a successful retail business. In Australia, the retail sector has certain quality management compliance standards which retailers aim to satisfy.
The retailers which fulfill these standards will receive an ISO9001 certification from the International Organization of Standardization. This signifies that the retail business has a quality management system in place which revolves around principles like leadership, customer focus, process approach, continual improvement, and fact-based decision making.
Employee Hiring & Training
Employees are representatives of the retail company. They are the ones who interact with customers and address their questions or concerns. For this reason, it is crucial that you hire employees who have great interpersonal skills and can represent your business in a positive and intelligent way.
This means that they need to treat customers with respect and dress professionally. Training these employees may even be necessary if you want them to abide by a company code of conduct.
Use a Point of Sale System
A point of sale system is essential in a retail environment because it allows you to keep track of all your inventory and sales. You can review information about every transaction that takes place in your store, such as the date, time, item name, and amount paid.
Along with tracking your revenue, you can track your inventory too. If you find that you are missing inventory where no revenue exchanged for it, then you will be able to tell if items were stolen or not. This point of sale system is definitely a necessity if you’re running a huge retail storefront because you can’t possibly keep track of all your inventory without a computerized system to help you.
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