Retail Management: A Beginner’s Guide
Retail management refers to controlling and managing everything related to a retail outlet, usually a store. It includes the day-to-day activities surrounding the sale of goods and services to customers. The main objective is to keep customers happy, ensuring that the retail outlet runs smoothly and remains profitable.
Typically, when one thinks of the activities of a retail manager, the first thing that comes to mind is someone who manages a store and oversees the store employees. And while that is undoubtedly part of it, there is a lot more to a retail management system today.
Those involved in retail management are not necessarily only those whose job title is “retail manager.” If you are a small business owner, you need to wear many hats, and a retail manager is almost certainly one of them. The rest of this article will help you understand how to utilize some critical retail management strategies to grow your physical or online business.
Essential Retail Management Skills
Now that we’ve established what retail management entails, let’s unpack what it takes to succeed. These are the essential skills that you will need at your disposal.
1. Communication
Effective communication is one of the most critical skills for any manager. While it includes communicating crucial points to your team clearly and efficiently, excellent communication also requires the ability to listen. Being a good manager means understanding your employees’ and customers’ issues and communicating strategies to fix them.
2. Motivation
Motivating your team is an integral part of any manager’s job. But in retail, where employees are on their feet and interacting with customers (sometimes sticky characters) on a day-to-day basis, it is all the more crucial. It’s up to you to pump up your team and set them up for success. You need to inspire them to become better salespeople. After all, they’re the ultimate ambassadors for your brand.
But being a good motivator is about more than inspirational pep talks – it’s also about providing constructive criticism, setting goals and incentives for improved performance, and giving credit where credit is due.
3. Multi-tasking
As a retail manager, you will likely have a million tasks to do at once. There will be issues to attend to at any given moment. The secret is knowing how to prioritize these and grouping them to get the most done in the least amount of time. It’s about working smart.
You will need to assist and supervise your team while working on your personal tasks throughout the day. A lengthy to-do list shouldn’t get you flustered. There’ll always be unforeseen circumstances that come up, so you’ll need to think on your feet.
Implement a sound retail management system that’s easy to follow. Make a list of your tasks at the start of each day. That way, you can see which ones can be done together or feed into each other. Don’t expect it all to go according to plan, make the most of your time when you’ve got a gap.
4. Organizational Skills
Multi-tasking feeds into your organization’s skill set. You’ll also need to manage schedules and budgets, identify how to cut costs, and problem-solve when issues come up. You’ll need to work around training new employees and streamlining your team’s output to optimize consistently. It’s all about effectively implementing a retail management system and finding ways to be as efficient as possible.
5. Customer Service
Whether you manage a physical or online store, customer service needs to be a central focus of your efforts. It involves more than simply being an attentive person with a winning smile – you need to understand the customer’s needs and behavior, adapting and responding in any given situation.
If there is a problem, you need to understand how to solve it quickly, effectively training your team to react in the same way. Customer experience plays a fundamental role in brand perceptions. It can be the difference between a bad review or a successful sale. While it’s easy to get emotional, you need to train your staff to stay neutral, problem-solving at every turn.
6. Decision Making
A lot of the work in retail management is on the go – dealing with things as they come up and deciding on a course of action immediately. In all likelihood, you will need to make multiple decisions every day. For this reason, an effective retail manager must be a good decision-maker, able to evaluate information and make the right decision in the blink of an eye.
7. Making Sales
To lead a team of salespeople effectively, a retail manager should also be a good salesperson. If your employees don’t trust that you know what you’re talking about when it comes to sales, it will be that much harder to motivate them and show strong leadership.
On top of that, if your employees see you actively reaching out to customers and making sales, it serves as an example to them to be more proactive.
Understanding The Role of Retail Marketing
We all know that marketing is about much more than advertising in today’s complex retail landscape. If you own a business, you are probably well aware of the importance of marketing via social media.
But what about developing floor plans, putting together promotional displays, and creating a welcoming customer experience? These are all part of retail marketing. Here are some vital retail marketing strategies that will help your business grow, no matter its size:
1. Sales Promotions
These are key to enhancing customer loyalty, attracting new customers, and driving sales. But a successful sales promotion requires plenty of thought when it comes to implementation. For example, displays advertising the special must be placed near the merchandise and near the checkout counters to promote last-minute purchase decisions. In addition, consider whether markdown or bundle pricing (i.e., buy one get one free) resonates more with your customers.
2. Loyalty Programs
These are similar to sales promotions in that they drive repeat purchases from existing customers and can attract new ones with the promise of attractive long-term benefits. Adding elements like giving members early access to new products or unique specials will create the allure of exclusivity for your loyalty program.
3. Customer Relationship Management (CRM)
CRM or customer relationship management is the cornerstone of retail marketing. After all, its core focus is to attract and retain customers. As a retail manager, you need to understand what existing, and prospective customers want, identifying their needs. In the days of social media, communicating with customers has never been easier – make sure you make the most of it!
4. Take It Online
Consider introducing an online store if you’re currently only operating in brick and mortar. It’s a golden opportunity for marketing and customer engagement. For example, adding interactive elements besides sales pages can help your brand stand out. Give customers some insights into who you are and what you stand for, highlighting your USPs. Introduce blog posts, quizzes, or even unique Spotify playlists – whatever makes sense for your brand persona.
The Importance of Supply Chain Management
Retail supply chain management is the process of overseeing the movement of goods and services from manufacturers/suppliers to the retail outlet and ultimately into the hands of consumers. The three key goals of retail supply chain management are reducing costs, improving efficiency, and satisfying demand. Achieving all these involves devising an effective supply chain strategy with long and short-term procurement goals.
Besides deciding where to source your products from, supply chain management also involves:
- Developing product quality standards.
- Planning the safe delivery of goods.
- Devising a plan for what to do when things go wrong.
A well-organized supply chain is crucial to business success – and here’s why:
- It improves customer service. Customers expect the products to be available when they want them, for the store to be well-stocked, and for follow-up support if there are any issues. Failure on any of these fronts can lead to an erosion of trust.
- It decreases cost. Effective supply chain management minimizes company expenditure and also enhances efficiency. The key elements here are who you choose to be your suppliers, how goods are transported, and how you deal with setbacks.
- It helps match supply to demand. If you have a good relationship with your supplier, you will be better positioned to negotiate and adjust how much product you want, depending on demand.
- It supports future growth. Strategic partnerships with suppliers can help enhance the mutual development of both ventures. The key is to find the right supplier early on so that you can grow together.
Supply Chain Management – Strategies For Success
Retail supply chain management should be a key focus of any retail system. However, political, technological, and socioeconomic factors make supply chains even more complex. Let’s explore some core strategies to help your business thrive despite today’s challenging landscape.
1. Use Demand Prediction To Match Real-time Demand
In today’s uncertain world, demand can rise or fall at any moment. If it were possible to know in advance when this would happen, you could solve pretty much all issues of surplus or shortfall. And although we cannot yet predict with certainty, digital tools such as AI make it possible to adjust supply chains based on real-time insights, matching expected demand. These technologies are constantly improving, and if you want an edge on your competitors, make sure you keep up to date.
2. Have A Solid Recovery Plan
No supply chain system is perfect, and something is sure to go wrong at some point. It is crucial to have recovery plans available for any foreseeable problem, such as manufacturing delays, issues with transport, or a communication breakdown. Not only that, but you need to document recovery plans properly, share them with all relevant parties, and regularly review and update them.
3. Quality Inspection
Even if you trust your suppliers, many things can happen along the way to affect the quality of the product. It is essential to inspect and test new products on arrival and regularly check on established products. If you only find out about inferior quality goods after you’ve made a bulk order, it’s too late.
4. Monitor Supplier Value
It’s not enough to decide on a supplier and then stick to them forever, no matter what. It is crucial to “market test” your suppliers to know whether you have made the right decision. Keep monitoring your suppliers against their price, quality, delivery, and customer satisfaction, and act accordingly.
Start Managing!
A lot goes into retail management in our day and age. A well-thought-out and strategic retail management system can be the difference between business success and failure. Incorporate some of these strategies as you tackle retail management, ensuring long-term growth for your brand.