Running a retail business looks like it should be simple. You stock your shelves with items customers want, open your doors, and let the money pour in. Unfortunately, it's nowhere near that easy.
In reality, you can spend hours figuring out something as simple as what price you're going to sell last year's swimsuits. Because there are a surprising amount of intricacies that can trip up retailers, let's look at eight classic gaffes retailers commit.
8 Blunders to Avoid at Your Retail Store
Whether you're opening your first store or have been in the business for decades, it's good to review some of the common mistakes that retailers make:
1. The wrong location.
The wrong location.
It's a bit of a cliché, sure, but location is one of the biggest make-or-break factors for a store. The right location means visibility, increased foot traffic, and accessibility. Don't trap yourself by choosing a location solely to save on rent. A good location is worth a premium.
2. Poor layout.
Your store's arrangement can have a huge impact on its success. The right layout draws attention to certain products. Many stores put small, impulse-buys near the register. When you run a sale, you can rearrange your layout to emphasize the products you want to move.
3. Setting prices too low.
Setting prices too low.
It's easy to fall into the trap of thinking you've always got to be beat your competitor's price. But if you store has the lowest prices on all items, there's no way you'll make ends meet. Set your prices high enough to pay your bills, leaving some wiggle room to mark them down later (see "8 Steps to Setting Prices for Your Retail Business").
4. Failing to add value.
Failing to add value.
Customers need to feel that your store is different and that you offer a value beyond merely the goods you sell. Emphasize your expertise, offer excellent customer service, and build a foundation of trust.
5. Refusing returns.
A great way to build customer loyalty is to accept returns. It's a bit counterintuitive, but it's true: having a great return policy encourages customers to spend more. Once you accept someone's return, there's a good chance they'll feel some loyalty, come back to your store, and open their wallet again.
6. Skimping on your web presence.
Skimping on your web presence.
Nowadays, it's not enough to have a website. You need to be active on social media, curate your Facebook page, and optimize your business for mobile devices. If you haven't checked out your Yelp reviews, do so. Business owners can respond to customers on Yelp, answering their questions, handling their complaints, and thanking them for their business. Be savvy with new ways to reach customers.
7. Liking your products too much.
Liking your products too much.
Some retailers get into the business because they like the products they sell. That's natural. Bookstore owners love books. Record store owners bleed vinyl. Sometimes this interest can lead storeowners to stock items that are interesting, but don't sell well. There's no shame in selling items you don't like, as long as they bring in a profit.
8. Not leading by example.
Not leading by example.
As a storeowner, it's easy to get wrapped up in all the things you need to do to run your store and forget that one of primary responsibilities is to be a good example for your employees. Congratulate employees when they upsell to customers, perform register spot checks, and do other tasks that show your employees you want the best for your store.
There's plenty of financial uncertainty that can come with being a storeowner, so don't forget to invest in small business insurance for retailers. The right policies may offer you protection for bumps in the road — lawsuits, theft, fires — that could bankrupt your store.