We all know what Einstein said about the definition of insanity. And, retail businesses it is very common for people to remain at the same size or same level of profitability year-in-year-out. Every year brings with it similar ebbs and flows, as well as similar results.
This is what I have phrased The Natural Settling Point (NSP).
Here is the formula:
Location + Skills + Personality + Loyal Follower + Default Activities = NSP
There is a lot to digest in this formula, and hopefully it is clear to see how many variables there are to play with to pull yourself and your business out of the NSP you may currently be in. There is no need to pick each aspect apart, but this formula does hint at what to do to bust through your current settling point. Some tried and tested options are listed below.
1. UPSKILL YOURSELF (AND YOUR TEAM)
Plan a self-development activity every 6 months for each person in the team starting with yourself. It may be as simple as reading a book on a topic that will help you implement a new initiative. Or you could attend an evening or one-day seminar. A weekend conference. Maybe enrol in an online training course. Or, maybe you are ready to go for something bigger like a certificate course. Whatever you choose to do, the name of the game is to pick the topic carefully and be sure to set a trackable goal off the back of the education you have received. This will ensure that the training pays for itself (many times over hopefully) and encourages positive change in the business. The same rules apply to team members.
2. SCRUTINISE THE USUAL MARKETING
Is your marketing working? Really? Maybe they are… or maybe they need to be re-energised, or revamped, or maybe they need a major overhaul. One of the most common reasons retail business owners do not do meaningful marketing promotions is that they feel it is a waste of time and money. It is very common for people to give up before they have started, and revert back to old school methods, and activities which end up being quite ineffectual. At the very least, calculate the costs and sales from all of the past activities and if they are performing poorly, then stop doing them all together. No activity is better than bad activity – it costs less time, less money, and less heartache (none of which are going spare for most of us).
3. A LITTLE FROM EVERYONE ADDS UP TO A LOT
If you have a small team, say its yourself and two others, and each of you increased your own sales, or average spend by 10%, that would add up to a big dent in sales results. If it was achieved over a full year, then the NSP would be smashed to bits. Let’s look at it another way. What if the weakest sales day of the week was focused on to make it a little stronger, or a product or product range was focused on to gain extra sales? In a salon business I worked with, the retail sales were hovering at approximately $50 per week. There were reasons for this, but it was quite weak. We set up a plan including an incentive, education from the Sales Rep, and weekly performance tracking by the manager on product sales. If the team achieved their incentive 80% of the time, we would generate over $500 in sales a week, and over a 14 week period (which was the remainder of the calendar year at the time), this would bring in an extra $6300. A big impact from a very small change, which the team ended up achieving. It also showed us how much money the business was “leaving on the table” so to speak. What is the little change you can make in your business that would add up to a lot?
4. GET A BIT WEIRD
This one makes everyone really nervous! I know, I get nervous myself, and for good reason. It is scary as hell! Its scary because there is all types of risk – financial, or even reputational. Sometimes, we’ve got to be open to doing something a little crazy. Make a concerted effort to try a different approach, or have some fun with a topic or an event. Only by taking some risks can we find unique and brilliantly interesting ways to move our business forward. Because there is risk involved in this, it is important to mitigate the risks by doing lots of research, only trialling things before committing to longer terms, and pledging low resources to an activity initially. Go for it, but there is no need to take huge leaps of faith packed with high levels of risk!!!
5. WHATEVER YOU DO, GO ALL IN!
Small half-baked initiatives and actions need to be banished. If we are truly going to leave the NSP behind once and for all, then doing many things in a mediocre way will need to be completely cut out. New Year’s Eve is not the only time to make a stand and commit to new beginnings. We can decide to do this today. Commit to a structure and work within it every day. Aim to be consistent before everything else. If you lead an activity 100%, you have a very good chance of getting the team to follow.
To wrap this up, it is wise to choose only one of these actions to implement at a time. Trying to do too much will probably land you back inside the NSP. Also, no matter what you do, there will be ups and downs, so be willing to adapt. Tweaking and adjusting as we go is not always easy, but will often be necessary.
The one guarantee is that that NSP is distinct in all of our businesses, and if we can recognise it there is a good chance that it can be left behind with some new and exciting activities.