Saturday, January 29, 2011

How One Bad Apple Nearly Spoiled the Ski Trip

The big family Christmas gift was a long ski weekend at Boyne Highlands in northern Michigan.

Although not as immediate as a box of Legos, the boys were thrilled. And the experience was incredible!

WOW Customer Service
We showed up at the Zip Line just as it was closing - no problem. They got us dressed and ready in no time at all and made it seem like we had made their day to stay open an extra 20 minutes. Korie was just a gem.

We showed up for our free buffet breakfast and had Martha, our waitress, treat us like rock stars. Dirty plates whisked away immediately. Tips on which buffet stand to get the freshest food. Anticipating our every needs. It was a free meal, so she wasn't in it for the tips (although she got a big one). She just obviously loved doing her job the right way.

At the bottom of the chair lift Tyler was able to strike up a conversation in the few seconds before we were lifted away that we kept going back to the same lift time and again just to keep the conversation going. No wonder he won employee-of-the-year last year (at least that's what he claimed, and I wouldn't argue.)

Every single interaction was over-the-top positive customer service...

Except one.

Not So WOW
It probably wasn't that big of a deal, but my wife was having a tough time getting off the inner tube course tow rope. The attendant seemed indifferent to her plight, even a little put-off that she was holding up the line (which consisted of one other person, my son). His attitude was a stark contrast to the friendly, caring attitude of the rest of the staff and it almost brought down the whole trip.

His indifference and attitude was all my wife could talk about.

Thank God Korie and the Zip Line team restored our faith later the same night.

But it was a quick lesson on how fast a great experience can unravel because of the careless work of one person in a seemingly unimportant position.

Hiding the Risk
The inner tube tow rope is probably pretty low on the totem pole of jobs at a top-notch ski resort. Maybe management knew this and put their lowest performing person there, thinking he could do the least amount of damage.

But least amount of damage is still damage. Had that been our last event of the trip, it would have been the defining moment.

If you have an employee doing damage, don't try to protect him or her. Train or fire. There is no middle ground. That may seem harsh, but your customers will be even more harsh. They won't come back for a second chance.

Korie, Martha and Tyler had to work extra hard to make up for this one mistake. And to their credit, they did! We already know what Santa is bringing next year.

-Phil

Tuesday, January 18, 2011

Could an Accounting Class Help?

On my website I readily admit that although I can help you in almost every aspect of retailing, if understanding your financials is your weak spot I'm not your guy. So you can imagine how I've been over the last few weeks.

Our accounting software finally bit the bullet. We've been using the same software since 1998, even though the software became obsolete in 2005 and the company disappeared in 2006. Hey, if it ain't broke, why fix it? But the software wouldn't allow dates beyond 12/31/10. Time to make the change. I spent December 27th and 28th with my accountants updating everything to the new software.

Our fiscal year is about to end. More meetings with the accountants are on the horizon.

While my accountants are absolutely nice and wonderful people, why must they insist on speaking in a foreign language? I still struggle to remember if I add debits and subtract credits or is it the other way around?

Most independent retailers I know have the same struggles. Reading financial statements like the Balance Sheet and Profit/Loss is like reading a Chinese road sign. But in my quest to always improve myself, I have made it my goal to grow my understanding of all things accounting in the retail world (with the exception of taxes - I'll tackle that next year).

I could take an accounting course, but all my friends who have done this warn me that it is backwards. Bank accounting - on which these courses are founded - is opposite of retail accounting. Huh? How stupid is that?

So instead I'm going to learn it the way most entrepreneurs do - self-taught one chunk at a time. And, yeah I plan to share what I learn right here. So look for a little more on the financial side of retail this year. Together, we'll both become experts.

You with me?

-Phil

PS Credits are added, Debits are subtracted (I think)

Wednesday, January 12, 2011

New Free eBook on Merchandising

Three straight posts on merchandising? Are you kidding?

Nope. But this one is a good one.
  • Six tips about merchandising every retailer should know.
  • The pros and cons of Branded sections within your store.
  • Military versus Whimsical - How to design your store layout.
  • The Most Important Four Feet of merchandise
  • How often you should change your displays
All of that and more is in my new eBook, Merchandising Made Easy. The download is FREE, the information is priceless.

-Phil

PS Check out all the other great Freebies, too!

Tuesday, January 11, 2011

Signs Really Do Sell Your Stuff Better

Yesterday I worked with my staff on signage. Rick Segal has repeatedly said that signs on a display help sell that merchandise 43% better than a display without signs.

I talked about the first reason why in an earlier post.

Here's another reason to consider... Value

Perceived Worth
When a customer enters your store, the first thing she is doing is putting a mental price on every item she sees. I call this the Perceived Worth (PW) - what it is worth to her.

If she doesn't need the item, the PW is zero. If she does need it, she assigns it a PW and then checks the price. If the price is much higher than her PW, then she won't buy it. Likewise, if the price is much lower, she still won't buy it. At least not until she figures out why it is so cheap.

Value Equation*
The Value Equation here is when the Actual Price equals the Perceived Worth. When they match, the sale is made.

That's where signs come in. They raise the PW of the products they are on.

Most customers are generally ignorant of all the features and benefits of the vast majority of your products. If they only knew how cool or beneficial the item was, the more they would think it is worth. And there are only a handful of ways for them to find out.
  • Look it up on the Internet (and possibly buy it there, too).
  • Ask an employee (which the other post explains why most men won't do that, and half the women aren't too eager to do that, either)
  • Read the package (which often requires touching the box, something they might not be committed enough to do)
  • Read the sign next to the package (which they will often do without a second thought)
Signs Bring Action
Signs take less of a commitment on the part of the customer, so they are more willing to read them than the package itself. A well-written sign gets them to commit a little more and compels them to pick up the item with a higher PW already in their mind.

Well-placed and well-written signs can make a huge difference in your sales. Just remember these three tips for crafting your sign.
  1. Answer the most frequently asked questions. The goal of the sign is twofold - raise the PW and get them to pick up the item. Answer whatever question a customer might have that would accomplish either or both of these goals.
  2. Make it about the Benefits. Why should the customer give this product another look?
  3. Handwritten signs are okay for temporary use, but more permanent signs should be Professionally printed.
You can quickly and easily increase your sales, move out slower merchandise, and make higher margins with the simple and proper use of signs.

-Phil

*PS For a complete explanation of how the Value Equation works, check out the FREE eBook Pricing for Profit.

Friday, January 7, 2011

Plotting the Course and Raising the Bar

We all do this. Plot our course for the next year. We are all busy making Sales Projections, Expense Budgets, and Marketing Plans.

But have you done a Training Plan?

Raising the Bar
Have you worked on a list of skills you want to teach or improve in your staff? Have you made a list of strengths and weaknesses for each individual and your store as a whole? Have you chosen a topic where you wish to raise the bar in your customer service this year and then plotted a course for training the staff to that new level?

One mistake I used to make was to think that just by telling the staff where I wanted them to improve, they would figure out how to do it. Big whoops!

You need to not only identify where to improve but also figure out how to train to that new level.

One Topic per Quarter
It takes time for your staff to grasp new concepts. It takes time for them to learn something new and be able to implement it in their daily routine.

Therefore, I always pick just one topic each quarter on which to focus. Then I plan all my trainings during that quarter on teaching the staff more about that topic. If we are successful in raising the bar then I will pick a new topic for the next quarter and plan all those trainings around that topic. If not, I go back to the drawing board and find new ways to teach the first topic.

For instance, last year we focused much of the year on Communication - communication between employee & customer, communication between employee & employee, communication between employee & me. Yeah, it was a big topic and took up most of the year. And we made great strides in raising the bar on the first two. (But unfortunately not the last point. Somewhere I failed. If the staff doesn't learn, it is never their fault, always the fault of the teacher. So I'll figure out something new and keep working on that point this year.)

Moving Forward
The focus at the beginning of this year will be on improving our merchandising skills. I could just tell the staff to do better, but nothing much will change. Instead, we will be working each month on a new skill such as how to use signage (who it is for, what it should say), building attractive endcaps, thinking like a customer.

My goal is to eventually empower the staff to recognize the difference between a customer-friendly display and a stocker-friendly display and know that they have the authority to make changes as necessary to keep the store fresh and exciting and move more merchandise.

But without a Training Plan, this doesn't get accomplished.

Training Plan Made Easy
Sound like too much? Make it simple on yourself.
  • Write down a list of your staff's overall strengths and weaknesses.
  • Pick two items on that weakness list and prioritize them.
  • Teach something on that highest priority until the staff gets it. Then move on.

You're the leader. So go lead the staff exactly where you want them to go.

-Phil

PS Need help planning your meetings/trainings? Here is a FREE eBook on how to do that easily and effectively. (Don't forget to download the worksheet too - but read the eBook first!)

Tuesday, January 4, 2011

Managers in Training

If you could send your manager (or yourself) away for training, what topics would you want him or her to learn?

Some of the topics might include:
  • Hiring
  • Staff Training
  • Time Management
  • Scheduling
  • Advertising & Marketing
  • Website development
  • Sales
  • Buying
  • Inventory Management
  • Bookkeeping
  • Reading Financial Statements
  • Merchandising
What are your top three or four? What would you add to that list?

-Phil

PS I had a request from someone who wanted to apprentice with me which got me thinking... What would I teach? What would they want to learn? Yeah, the second question is the key, isn't it?