Management tip

Context can be everything if you expect an employee to embrace a change of direction, a new product mix or some other decision that is different to what the business has usually done.

My management tip today is to explain these decisions, provide a data context that encourages belief and support.

Get this right and you can anticipate greater support from within for the business decisions you make.

Why matters.

Too many newsagents use software in their businesses as a glorified cash register. They track stock in, scale sales, scan returns and that is it. Rarely do they manage the business by the numbers.

Next time you scan an item being purchased at th counter, think why? Think about whether you actually use all the data being collected and cultivated.

My challenge today is that you actually use it.

I am prompted to write this because if data I see in a report from a retail business I know of. They have excellent data, that chronicles the steady decline of the business and shows no action to arrest the decline. This is a business that uses their software as a glorified cash register. What a waste.

It is the end of the financial year in a few days, are you ready? At the very basic level, here is what you should do at the close of business on June 30:

1. Take a backup. Mark it your June 30 back up. Store it in a safe place.
2. Run a stock listing report. Include all stock with a quantity on hand of 1 or more. Save this as a PDF. Email the report to yourself as an extra backup.
3. Print a customer debtors report. Email the report to yourself as an extra backup.

If you have accurate stock on hand data, through well managed stock moment management, you will not need to do an EOFY stock take.

Business gurus often talk about the 80:20 rule, they find all sorts of ways to apply it. In newsagencies, we could apply it by saying that 80% of our product revenue comes from 20% of our products.

It is easy for newsagents to get this stat for their business. That’s my tip today, find out what your inventory gap is, the gap between the uber performing inventory items and the gap down to the rest, the products that don’t perform adequately for your business.

Beyond the financial cost and regardless of the size of the theft, employee theft in a retail business can come at a huge cost to the business, those who work in it and the owners.

The impact can be felt for years after employee theft is discovered.

I have been involved in supporting plenty of retailers dealing with employee theft in their businesses.

Often, the person caught stealing from a retail business is one of the most trusted employees. This is where the high emotional cost kicks in. It is not uncommon for them to be a long term employee who has the trust and respect of the business owners. Often, it has been a relative of the owner or at least someone treated as a relative or a member of the family.

I see the impact of the theft flowing in waves:

1. Typically, the retail business owners blame themselves for the theft or at the very least for not having discovered it sooner.
2. What follows is the extraordinary feeling of a breach of trust and violation. This can lead to a feeling of overwhelming illness. In some cases, one or more of the business owners have withdrawn from the business – such is the personal hurt and betrayal they feel.
3. Devastation often kicks in with the owners losing focus on the business, unable to deal with the issues of today.
4. Depending on the extent of the theft, depression can follow which requires some form of intervention to resolve.

The personal impact on the outlook and confidence of the business owner can be devastating. Unless they are able to accept what has happened and genuinely move on, they could find themselves wallowing in anger, inaction or even depression for long after the crime has bene discovered.

The key, from our personal experience, is to accept what has happened, make a decision on how to deal with it and move on… never looking back.

Discovering an employee theft problem is an excellent first step. The alternative is that it continues unabated. Discovery stops the theft and that is a great first step. It is important to acknowledge the good news of the discovery regardless of the quantum of theft discovered.

Deciding an action plan is the ideal step two. Deciding whether to report the crime or agree on an immediate financial settlement with the employee who committed the crime is the best next step. Only the retail business owner can decide whether reporting the crime is worth it or not. Sometimes, being paid a reasonable sum by the employee is better for the business and moving on than a protracted police investigation.

Talk with the team. Listen. Console. This is a time for grieving about what happened. Either gather as a group or one on one. Ensure that everyone has an opportunity to air their feelings. Business partners especially should take time to do this and explore how they feel. Do not let this process go on too long. Ensure that everyone understands that this is the time of grieving and that when it ends, it ends so that the business and those involved can move on.

Focusing on the business is the fourth important step. Once the employee theft is caught, the action plan re police versus reimbursement resolved, the next focus has to be the business. Difficult as this is, it is important to move forward rather than to stand still and wonder what might have been or worry about the betrayal one feels. Look at business practices and modify these so that theft is harder to perpetrate, implement processes which disrupt the business and make theft easier to detect.

There are excellent government and community resources which can help. Engage and use these resources and benefit from the insights of others.

How a retail business comes out of discovering employee theft is up to the leaders of the business themselves. They set the mood for the team. It is important to reach a point of moving on and not looking back as soon as possible – for the sake of the business, its employees and its customers.

For years we have obsessed about what we put behind the sales counter at the shop. We see this location as a vital platform from which to make a statement about the business. Oh, and it is terrific location from which to win valuable impulse purchases.

This photo shows our latest display, primarily focussed on Cabbage Patch Kids. Yes, they are back in vogue with a refreshed range and packaging. They can appeal as a nostalgia purchase or to an entirely new collector.

What we do behind our counter in our businesses really matters. I think making a statement is key – not merely a visual statement, a business statement. This means having a clear message, with a brand focus, pursuing impulse purchases and challenging assumptions about what your business is.

Stand where your customers stand. Look at what they see. If the message is not clear and the commercial goal not being achieved, rip it all down and build a new statement.

Check out this sign used by a UK card retailer that specialises in raunchy cards.

It may not stop humourless moral warriors from being upset but it allows you to say you were warned.

The Mother’s Day traffic spike is a reminder of the value of a frictionless loyalty program. That is what I saw in-store with discount vouchers with first-time and infrequent shoppers using the voucher they received for an additional purchase. The vouchers absolutely drove incremental purchases.

I call it frictionless loyalty because there is no paperwork, no sign up process, no delay. The rewards are easy to understand. People responded by shopping the shop, again, after their first purchase.

Major seasons are a perfect opportunity to do this.

The shop we took over recently as too big for what we wanted to do with it in the short to medium term. So, rather thankful the excess space with stock and rather than fixing the problematic back part of the shop, we installed a black curtain, blocking it off.

The curtain was cheap and installing it was a breeze.

We put some Ikea shelving in front of the curtain and we are a professional looking space, the right size for what we want right now. Plus we have a work area behind the curtain for us to play in.

I see too many retail businesses with too much stock – because they have not trimmed their space to what is appropriate to the business. Do not put stock in the business just to fill up the space.

A quick visit to Spotlight or similar and you can create a professional looking wall without the cost of a shopfitter.

Greeting card sales data offers newsagents terrific guidance on what gifts to stock. Dig deep into the data and you will be equipped to make better quality decisions on what gifts to stock in the business.

I was talking to a newsagent last year who said they could not sell male gifts. They did not have any in the shop. It turned out they had not had any in the ten years the current owner had owned the business. In their card data, plenty of male birthday cards were being purchased. A quick dig provided demographic and other information.

Greeting card sales data in a newsagency business is one of the best resources to mine if you want to grow gift sales.

A newsagents I was speaking with recently expressed concern about sales. I took a look at their data and saw healthy numbers. Whereas they were looking at data for two weeks, I was looking at data for three months.

Comparing trading periods with less than two weeks data is dangerous. You need at least three months, preferably longer.

In my own businesses I look at three months and then compare over a longer period.

Anything shorter than three months can skew your perspective. Seasons, for example, can impact and this is heightened with a smaller data set.

Comparing the first six months of a year with the year before provides a cleaner, smoother analysis and this is what you need for uncovering real trends being experienced by the business. Looking at two weeks is dangerous.

Show don’t tell is true in retail. Go to a Lush soap shop and you are given a wonderful sensory experience. Go to a good toy shop and you’re encouraged to play. Go to a good book shop and there are couches where you can sit and read.

Engaging with products is the best way to promote them. This is why I say have fun. The fun comes from you and your team enjoying what you sell, having with the products yourselves in the business.

There are many items in good Newsagency businesses today where we can have fun, even in the traditional products we sell.

1. Put a newspaper on a small table with chairs for people to sit and do the crossword.
2. Do the same with a crossword magazine.
3. Start a Better Homes cooking club and invite customers to bring in a treat they made from a recipe in the magazine. This could be a fun monthly feature.
4. Always have a sample of candy you sell.
5. Have toys kids can play with.
6. If you sell jigsaws have one out people can do.
7. If you sell toys, have a particularly fun toy out and encourage kids to play.

My point here is engage with your products, move from being a shopkeeper to being an engaged retailer who embraces products in the shop for your fun and for the fun of your customers.

You will make more money by engaging with what you sell.

This photo eliminates a point of friction shoppers encounter in many shops. Try it in your business.