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Archive for May, 2009

Retail Sales Training: Make The First Sale Of The Day

yankeesA lot was being said of the NY Yankees and how they have conquered their losing streak with several walk-off wins in close games.

I was listening to one of the announcers who said that typically, the team that gets a hit usually wins the game.  It does something for confidence for the team.  You can see it when the the next up gets on base. Success builds success.

That’s why, when I worked the retail floor many years ago, I was the first one to make a sale.

I had to prove it to myself each day that I could do it.

That’s my short post for you today – to challenge you to make the first sale of the day.  Not greet the first customer but make the first sale.

Maybe that means you have to wait on several people until you make it but the lesson and example to your crew is better than any book they could read, video they could watch or podcast they could listen to.

Seeing you being a success makes it much harder to stand behind a counter and groan, “No one’s buying.”

Retailers Financials: Collision Course To Reality

Retail sales are up. Stocks are up. So why are so many independents down? They aren’t making money.

Truth is, many never have but it took the economy to pop like a balloon to bring them back to earth.  It was a crash course in reality. But why does it persist?kf_collision

Is it that the owners are enamored with being “the boss?”

Does their wife have an endowment she is supported by, so their business hasn’t really had to make a profit?

Do they have a husband who has another job and this has been a hobby?

Do they like to buy pretty things regardless of whether they sell?

Maybe they own the building so rent is cheap. But the reality is you have to pay attention to your business fundamentals before it is too late.

You’re either taking out a profit or you’re putting in money.  Period.  When you continue to pump money in with no letup, you have to ask if this is a viable business or not.  Many owners discover they’re subsidizing their customers by not pricing correctly, being over-bought or staffing so their friends have jobs.

I heard a speaker last week say you could double sales by just asking more people to buy.  If you believe that or you think saying, “I refuse to participate in the recession” will result in more sales, I think you’re delusional.

Much like after 9/11, we are in a different environment than many of us have ever faced.  We can’t hide from the truth – business is work.

A marriage is work. Raising kids is work. We see what happens when people don’t take care of those things.

When you’re in denial about your business, the financial results can be devastating.  When it closes, everyone sees what the owners should have seen.

Some business owners I read about in the papers and online seem OK with hoping for better days, not working on them.  But isn’t that fairly naive, almost child-like? For them I’d suggest now is the time to take off the bib and put on the apron.

Put another way, if you’re happy being in denial and driving blind in the car, you are on a collision course with reality.

If you want to know what you can do about it, get a copy of Phibbs book, You Can Compete: Double Sales Without Discounting. It is the backbone of scores of businesses’ training programs because it teaches his methods for making a business successful. Download more free tips at his website. Follow him on Twitter at http://www.twitter.com/theretaildoctor.com

McDonald's Iced Coffee Bandwagon Shouldn't Scare Independents

bandwagonCircus workers were skilled at attracting the public with the razzmatazz of a parade through town, complete with highly decorated bandwagons. In the late 19th century, politicians picked up on this form of attracting a crowd and began using bandwagons when campaigning for office.

Now it means a way of joining something, often in an opportunist way, when that movement is seen to have become successful.

McDonald’s has launched a massive ad campaign as their McCafe that is very broad with a deep reach. At only $1.79, I know they are selling a lot of iced coffee.

What’s interesting has been a lot in the specialty coffee community taking the cynical side and mocking the newcomer McDonald’s as well as the industry leader Starbucks. Like this from comments appearing after a related story in the Los Angeles Times, “Starbucks stumbled in part when they drifted far enough away from serving only excellent coffee that they alienated (with seemingly interminable waits whilst the 12 year old in front of you gets her decaf lo-fat frappe chai chino vente) the educated.”

For independent coffeehouses, they need to fish while the fish are biting.  They need to get banners, window clings and POP showing their iced coffee drinks, not spend time harping on the big boys.mccafe-400x300

Retailers over the past several years have been on only one bandwagon – discount. At some point you have to look at whether there is any differentiating factor or opportunity left in that.

Case in point, some coffeehouses just pour drip coffee over ice – yuck. Some use a cold-brew toddy which is nice and some brew espresso shots over ice.

Those differentiating factors of how it is made will make it important to train the crew how to explain what you offer.  They’ll also need to taste test next to Starbucks and McCafe so their crew can speak about it intelligently. Again, someone who likes McCafe’s coffee should not be seen as a threat – they came to YOUR shop to try yours – the independent should win them over – not piss them off.

Starbucks was a godsend to independent coffeehouses as they steamrolled across the country – they are the reason specialty coffee has the enormous market it does today. With specialty coffee at McDonald’s – it doesn’t have to be an “either” it can be an “and”. People can go to McDonald’s and the independent coffee house.

The smart coffeehouses like the ones I mention in my book, You Can Compete will capitalize on this phenomenon to segment their offerings as an upgrade.

What opportunities can you can get on the bandwagon for in your market?

Let’s Admit Customer Service Training Doesn’t Deliver

Customer service. We’ve all heard the need for it. We’ve all tried to manage it. We’ve all felt a lack of it.

America is hurting, stores are shuttering, consumers are wary. So can we finally put the words “customer service” out  to pasture? And along with that the Disney-eque way of referring to customers as “guests?” They’re called customers because they buy things from us, not guests who come to tea and visit.

Can we agree that “customer service” has provided a sea of gray in a world that should be black and white?

The Golden Rule is the backbone of servicing a customer; it exists in many languages, cultures and religions.  I think the Greek philosopher Thales said it best,  “Avoid doing what you would blame others for doing.”

Yet we retailers have kept doing it. Ignoring customers. Trying any of the hundreds of “tried and true ways to close the sale.”  Dropped prices like some reality show contestant willing to do anything to win. Lied to them and underappreciated what it took for them to buy our wares.

That’s because we’ve had a movement called “customer service,” which has made many authors, trainers, speakers, consultants, and department heads well paid.

But in the end, results have gone down.  Why is that?

Because we left the sale out of the service; that was the role of a merchant.  The old time merchants were the ones who wanted all of your business and actively controlled the sale by being on the floor, engaging customers, talking-up their best finds and giving the orders, “No one leaves here without buying something.” That may seem pushy but we have swung to the opposite end.

Case in point, I called a specialty retailer’s order desk looking for a $200 specific item yesterday. Response, “Let me check. Nope don’t got it.” Silence.  Someone else got the business by saying, “We can order it and you’ll have it tomorrow.” That’s not pushy, that’s selling.

“Customer Service” is not being left alone to browse, or being asked, “Debit or credit?,” or as we’re walking out the door, “Did you find everything ok?” No wonder self-serve checkouts are becoming so popular.

“Customer Service” is not propping up your crew by saying, “Oh, it’s not your fault, it’s the economy, that’s why no one’s buying.”  When did you ever have a coach in sports give the team the loser’s limp?  Exactly.

When I grew up in the sixties, you either won or lost a game.  Simple. Now there are no winners or losers – “everyone’s a winner.”  It’s what my buddy Nathan and I compared to Trophy Day at a ballpark the other day.  Everyone who enters gets a trophy.  Not because you deserve it, did anything special or competed – you showed up – BRAVO!  “Customer service” training is many times “Trophy Day” at the mall.

If we taught selling was the important part of customer interaction, we’d be able to train an exceptional interaction.

Why? Because a sale is an act of completion. Customer service is an act.

In many cases customer service is an illusion higher-ups tell themselves they passionately support. But in reality they don’t devote the time or money to train it; especially in 2009.

I wrote the book on how to compete and it wasn’t through discounting or “customer service,” it was through selling. Yes, you’ll certainly have to fire more, hire more and train more; so what, get over it.

Instead of complaining about the state of the economy in general and retail in particular, go out on your sales floor and see the folly of your “customer service” program as employees text each other how bored they are.

If I can see it, why can’t you?

Count the number of customers an employee actually walks up to and the number of transactions.  Then count the number of times an employee added one thing to the sale – I’ll bet it is zero.

Instead of looking to fancy studies and “best practices” of your competitors, why not look in the mirror and see the failure of buyers is often the failure of selling.

If we can admit that, we can truly get back to the role of a merchant: to sell the merch.

Best-selling author and speaker Bob Phibbs has helped thousands of independent businesses compete by using his sales approach and not discounting.  His Book, You Can Compete: Double Sales Without Discounting is the backbone of several companies training programs and teaches his methods for making over a business. You can download it now on Kindle from http://tinyurl.com/ovrqme.

 

Haggling Helpless Retailers

images-3Stories about haggling continue to abound with wild claims of amount saved and pervasiveness in America right now. Case in point was this article in the Los Angeles Times by Susan Carpenter, Go Ahead, Haggle. It quoted Pam Goodfellow with BIGresearch, a consumer intelligence firm that “Everybody’s looking for innovative ways to save a few dollars. If that means going to a garage sale and haggling a $10 item down to $5, it’s something people are doing right now.”  She said a 2008 survey found that 50% of Americans were haggling for better prices on all kinds of products in light of the economy.

Cheap people have been around forever.  You’ve had to deal with them before and so have I.  When I used to sell western wear in the 80′s I’d have guys ask me to “throw in the shoe trees and I’ll take ‘em.” No dice. I remember asking one guy, “So how do you buy groceries – say, ‘I’ll take the grapes if you throw in the Windex?’”  It usually got a laugh and a sale. Again, if you are a salesperson, you learn to read people and know how to be a chameleon with customers.

How did I develop thick skin to not discount? I saw the slippery slope I would be going down if haggling produced results.  The gal or guy gets their way. They tell their friends of the “great deal.” Their friends come looking for that deal. You have to remember what you did to repeat it.  Then the original person comes back and wants an even BIGGER deal for all the business they brought you.

The piece that I think so many businesses leave out is training their employees to not do it.  I don’t care that Seth Godin has said all employees should be “empowered to discount up to 10% to save a sale.” That’s not good management.

Your employees are hurting themselves and faced with debt. They identify with anyone looking for a deal. They already feel you are making boat loads of money off them. They don’t know how to sell to begin with so if someone will like them for giving them a “deal,” they’ll do it.  That can kill profits.

zeroperent-offHere’s how to stop the haggling virus:

  • Explain how much profit you make to your crew from every dollar showing rent, taxes, insurance, health benefits, advertising, the works; with most businesses it is about 3 – 5 cents out of each dollar paid.  Any less money is less to pay them.
  • Train employees how to sell (see product at end of this article)
  • Institute a “no haggling” policy. Just don’t do it.
  • Give scripts for what to say you can do if asked that might include: “No, we don’t have a lower price on this item but you can sign-up on our e-club to get the best prices right here.” “We have a similar item over here.”  “You can put it on layaway.”

You must have scripts or well-meaning employees say things like, “I’m sorry I can’t do that,” which implies that someone else can. Or they say, “Only the manager can do that,” which implies the manager can.

As more stories continue to pop up by writers identifying with people looking for discounts you have to arm yourself to stop it, or face becoming one of those haggling helpless retailers grateful for any sale.

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sales-rx-webHow to grow sales in a down economy? The Retail Doc’s Five Parts to a Successful Sale is Phibbs proven sales techniques on two DVDs with workbook.  You’ll actually see Phibbs training a crew with the exact exercises needed to instill a sales process into your store.