The Retail Doctor

What can boutique retailers do to protect themselves falling sales and is franchising the right way for small businesses to get ahead? The Doctor responds.

Hard road
I have had my fashion shop on the strip for over 10 years. Recently a neighbouring shopping centre has expanded and now I find my sales have decreased by more than 20 per cent. There just seems to be less traffic and I am very concerned. Can you offer any suggestions or advice?

Have you been collecting historical customer data as they have purchased from you?
Do you have a direct marketing relationship with your customer base?
Are you building VIP loyalty events for your clientele?
Is your average transaction value static or in decline?
Have you got strong add on sale opportunities within your mix?
Are you reviewing your competitors and actively shaping your offer to be that little extra in its uniqueness?
Are your windows strong, fresh and vibrant with an eye grabbing and strong message?
Are you reviewing inventory levels and managing your OTB levels in ratio to current & future sales?
Are you watching cash flow planning to minimize those unnecessary expenses?
Are you measuring the number of shoppers that visit your stores and become buyers?
Are you reviewing staff sales productivity, rather than slashing staff costs?
Are you having your customer service level evaluated by colleagues or perhaps engaging in Mystery shopper feedback?
Have you put this and other information into a business recovery and turnaround plan that will be your "compass" points in recapturing those lost sales?
Of some comfort may be the fact that in many cases, trading patterns and sales do return to "normal levels" once the novelty of a new shopping centre subsides.


Spreading the word
We have a healthy business, trading well and looking to grow. We are interested in franchising although not sure what the advantages are?
Can you advise?

Franchising is defined as a continuing relationship in which the franchisor provides a licensed privilege to the franchisee to do business and offers assistance in organizing, training, merchandising, marketing, and managing in return for a consideration. Franchising is a form of business by which the owner (franchisor) of a product, service, or method obtains distribution through affiliated dealers (franchisees). ..
To be a successful franchisor you will need to have:
* Weathered a few business cycles to ensure that your model is robust and sustainable
* A business model that can be easily replicated and is capable of systemising
* A business model with a discernible point of difference
* Well documented business processes
* A business plan that clearly defines way forward
* Marketing and promotions plan to support the growth plans.
* All your brand protection and intellectual property in place
* Your legal documentation in place (Complying with all legal requirements)
* A rigorous franchisee recruitment and selection criteria is in place
* All franchise recruitment and training processes and content are in place
* Your product distribution pathways are secured.
Quality franchisees who can contribute to the business growth, whilst forming a quality relationship with you as the franchisor is very important. There is plenty of material available on this to


If you have questions you would like answered by either The Retail Doctor or Money Talks, please send them to ragtrader@yaffa.com.au