Especially now, with the economy as it is, it is vital that a jewelry store be managed based on factual information. No longer can we afford to run the business based on our opinion of what needs to be done to maintain or increase sales. In jewelry retailing, or all retail for that matter, there are three vital numbers owners and managers need to know in order to increase sales and profits. The three numbers are Traffic Count, Average
The single biggest reason that businesses fail is because they are managed based on opinion, rather than on factual information. You need to know “why” sales are up or down. When you track the proper three numbers, you can determine “why” sales are as they are. Without the facts, it is very easy to become complacent and fall into the sea of mediocrity.
For example, if a store is running down 10% there is only one of three things or a combination of three things that could be happening.
- You may not be getting as many people through the door. If this is the case then you need to spend your time and effort on bringing more people in the store (traffic count).
- Your salespeople aren’t selling as many of the people. If this is the case then spend your time and efforts on training your salespeople to increase their closing ratio.
- You are not selling your customers as much. Meaning your average sale has dropped. If this is the case then it could be a merchandise problem, it could be that your salespeople aren’t adding-on or bumping up or that there has been a dramatic change in economic conditions and people can’t spend as much as in the past. Then you need to get more people in spending less.
Once we know this information then we can react in a way that will have a dramatic impact on our business. Another example: what if the store is running up 10%? What three statistics do you need to track to determine why sales are up? The same numbers because you have to improve upon the past in order to increase the future.
At the Olympics the difference between failure and success, or a gold medal and no medal, may be hundredths of thousandths of a second. In sports, the difference between winning and losing might be one play or one mistake. In golf, one less stroke after 72 holes might be the difference between a tournament won or lost. In retail jewelry, the difference between a store that is growing and flourishing and one that is barely getting by could be one or two percentage points in Closing Ratio.
As a store owner or manager, it is time to sweat the small stuff and proactively manage the business. As a salesperson – look at your profession as running your own business within the business and grow your personal business based on facts.
Statistics give you facts - working to improve statistics gets results.
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