- Many small retail businesses fail within the first year of opening. It's not an easy path to take!
- It's usually never due to a lack of hard work, but inexperience and poor decision making that make it a struggle to keep the business afloat.
- In this article, we share 7 tips to help you make it through that tough first year as a small retail business owner.
When embarking on a quest that will ultimately lead to you acquiring a certain amount of riches and living a very comfortable life, it is important to realize that the path ahead of you is not exactly paved with gold.
In fact, the term “road to success” is a bit of a misnomer, since what the new entrepreneur will experience is more akin to a meandering dirt track through the jungle than an urban road that runs straight.
Many small businesses will fail within the year or make a number of glaring mistakes that lead to the ultimate downfall of their little enterprise a couple of years down the road.
The saddest thing is that, more often than not, it’s not the lack of hard work and dedication, but rather a lack of experience that causes new entrepreneurs to make some pretty bad judgment calls or fail to adequately address important problems.
How to Survive Your First Year in Retail
Here are seven useful tips that will help you survive your first year:
- Make sure you have enough money stashed away
- You will need to continually put money back into the business
- Opt for a modern POS system
- Keep a close eye on your employees
- Don’t go overboard with promotions and giveaways
- Utilize new technologies
- Build up your connections
1. Make sure you have enough money stashed away
It will be some time before you can expect to see a return on your investment, so make sure you have enough funds to sustain you and your family while your business is still in its initial stages. Remember, running a retail business is time consuming – well, at least if you do it right - and it will burn through your funds quickly if you are not careful.
2. You will need to continually put money back into the business
If you are even a little ambitious, you will want the quality of your merchandise to improve, your store to grow and to attract more customers. This means that you will have to keep investing in your store - spending some money on things like designing a website, marketing, expanding the store, hiring more workers and so on.
3. Opt for a modern POS system
Modern POS systems allow your employees to manage your store more effectively and provide you with great options like offering gift vouchers, lay-bys, coupon promotions and enabling point-based rewards for loyal customers. POS interfaces can be integrated with scales and even help you manage employees by providing separate access passwords and requiring them to sign in and out, thus keeping track of their behavior on the job.
4. Keep a close eye on your employees
Most retail stores will employ a number of young people and although they can be good workers, they often lack a strong sense of commitment and responsibility. They may slack of or just mess things ups due to a lack of focus.
It is important to have seniors, yourself or a manager, to supervise the workers. Surveillance cameras and requiring them to log off POS terminals when they are on a break will give you a pretty good idea of a worker’s performance as well.
5. Don’t go overboard with promotions and giveaways
People often feel that in order to get their name out there they need to offer a lot of free stuff and have frequent promotions. These giveaways can bleed a new business pretty quickly and a stampede of people eager to receive free stuff can make a huge mess in your store.
6. Utilize new technologies
There are a number of incredibly useful Smartphone and tablet apps created for retail stores that can improve the way you do business. Your employees can swipe credit cards with a phone and use a tablet to browse through the items you have in stock or show the customer how different items would look if matched together. It can help enhance the experience of the customer.
7. Build up your connections
Once you have all of the little things covered you need to start focusing on building some connections so you can get your merchandise for a slightly lower price or find people who can deal with your growing demands as you begin to expand your business. It’s often about who you know rather than what you know, so start networking.
This is about all the general advice one can give without knowing all the necessary details, so I would advise you to look for additional advice from successful people in your industry. It is important to keep learning and growing if you want to see some long-term results.
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