HERE ARE SOME OF THE TOP REASONS WHY YOUR BUSINESS IS LOSING OUT ON RETAIL SALES
The second you see that your sales are dropping, you have to try and get to the bottom of it. At the end of the day, sales can decline for a huge number of reasons, and finding the cause can be the hardest part of the problem. If you want to narrow things down, then this guide will help you to find out everything you need to know.
Poor Communication
Sales are often never as good as they could be if teams have poor communication. In the world of retail, it is vital that you have a seamless relationship between your marketing team and your merchandising team. You also need to help them to make well-informed decisions so that you can maximise your performance in general. If you do not have good communication between your teams, then you may find that your products are misaligned with the message you are putting out there and this can work against you. One example of this would be if your team are investing a lot of the advertising budget for products that are at a low price point. The merchandising team might not be ready for such a surge in demand, and this can translate to lost sales and things being out of stock. Not only do you miss out here, but your customers do as well. It is vital that you try and make sure that the goals that your team have are aligned across the board. This will result in far better decisions being made and you may even find that it helps you to increase sales.
Poor Assortment
When a customer enters your store, it’s your job to make sure that they find what they are looking for. If you don’t, then you may find that this creates a very poor shopping experience and that you end up missing out on sales too. If you want to do something about this then you need to try and anticipate what your customers are wanting to buy from you. Even though retail stores cannot carry a huge amount of inventory, having a good assortment can help you to provide a positive shopping experience for your customers and it can also encourage them to shop with you again. Even if you do not have what your customer is looking for, if you can provide them with something similar then you may find that you end up still being able to provide them with a positive experience. Assortment optimisation usually starts with trying to assess any historical trends with your inventory. This can be time-consuming if you do it manually, but at the end of the day it will help you to identify demand, and it will also help you to see if there are any patterns too.
Additional Value
If you are not providing enough value to your team, then this could be another reason why your sales are declining. It may be that your competition are providing far more incentives than you are, or that they offer free shipping or even free returns. Free shipping is what 88% of customers happen to want the most, so if you can make sure that you offer this, then you surely won’t be missing out. Loyalty programs are another way that you can make sure your customers return to you time and time again. By providing them with some kind of incentive to shop at your store, you can then generate loyalty. That being said, programs like this are only effective if your customers are aware of how they can earn points. They also need to know how close they are to being able to earn a reward too, so it is vital that you keep this in mind.
Price
Price has a huge influence on sales. All in all, a high price can maximise the profits you experience in the short term. A low price will maximise your long term profit as it will attract far more customers and it will also help your business to gain a market share. Price can be a determinant of your brand and the quality you have to offer as well. if you launch with a high price, then in the eyes of your customers, this will translate to a higher positioning and quality. A price change on a sensitive product can reduce your sales, so you need to look at your price elasticity to see how high, or how low you can go without changing a customer’s perception of your brand.
You are not Aligning your Promotions
Sales promotions are an incredibly effective way of you increasing sales, not to mention that it can also help you to build your customer satisfaction. That being said, if you are not promoting the right items, then this could be working against you. If you look at the historical habits that your customers have, then this will uncover trends, as mentioned above. That being said, it helps to take things one step further by trying to predict customer behaviour where possible. You need to try and predict the way they are going to feel at various points of the year, or the sales cycle so that you can then align your promotions accordingly.
Overlooking Competition
Diving deep into your competitor data can help you to find some very useful insights. The underlying issue that accompanies your declining sales could be because your competitors have launched a new marketing campaign or that they have a promotion right now. If you are a low-cost retailer then you need to make sure that your price is always lower. If you need some help with this, then you can easily adopt price intelligence software. The great thing about this is that it will help you to maximise the margin that you have while also making sure that you are still very much competitively priced.
You’re Not Open Enough
You may also be losing out on sales because you are closed when you should really be open. Some small businesses tend to have very inconsistent opening hours, and this will work against you far more than you realise. You might think that hanging a sign on your door is going to tell your customers that you will be right back, but most of the time your customers will not wait for you. You have to make sure that you are consistent, even if you do not think that you are making a lot of sales on particular days. If you can do this, then you will soon be able to boost your retail profits.
You are Closed During the Holidays
This is not a call for you to be open on Thanksgiving or even Christmas, but there is a long holiday period that could well bring tourists or any other shopper to your area. It is a good idea for you to try and stay open during this time if possible because you never know how it is going to impact your business. The more you can try and positively impact your shoppers by giving them opportunity and convenience, the more sales you will make.
You Are Only a Brick and Mortar Store
Sure, having a brick and mortar store is great, but at the end of the day, you still have to make sure that you have some kind of online presence too. If you don’t, then you may find that you end up missing out on a huge market. Even if you do not sell online, you should still be advertising the products that you have and the prices too. If you can do this, then you will soon find that you are able to make way more sales and this can work in your favour. You may even find that your sales rocket. If you have an online presence, it may be worth investing in live chat for website use if possible.
You Are Not Building Relationships
If you are not interested in relationships then this will also work against you. One of the main differentiators when it comes to local businesses is that they have a connection factor. Locals will often give advice or even suggestions about the area, such as the best places to dine or even must-see places. A great way for you to get more sales would be for you to try and build relationships with other businesses if possible. If you can do this, then you will soon see that you can rocket your engagement.
You Think Everyone is Browsing
It is difficult if you have the type of business where people stroll in and out. It is very easy to assume that everyone is not a buyer but at the end of the day, if you do this, then you may end up missing out on sales. Your assumption may make you less patient with people and it may also make it much harder for you to make that connection too, which is the last thing that you want.