The basics of the shop
The first thing you need to understand is the fact that the store is not a point for generating company profits. This is a tool for processing the loaded goods into money, and it creates only expenses. The source of profit is often far beyond the store itself.
The store operates as a chain of conversions, where each indicator is subject to change control, point owner, purchaser, or policy maker of the entire network. The task of the store as a business unit is to process the goods into revenues and at the same time bring positive to the client. Therefore, the task of the seller number 1 is always - that the person came out satisfied. And only number 2 - to sell something. Based on this relationship is built to the rules of the sales and the rest of common sense. To be good, adequate, correct is economically justified.
The main thing in the store is its gross profit: it is revenue minus the cost of sales. All this is decomposed into fairly predictable and measurable factors. The simplified formula is this:
The number of purchases is a group of conversions: passed by -> went into the store -> bought. And there is a similar chain on those who, from somewhere, found out about the goods in a targeted manner and went to the store to pick it up. Simplifying:
We must work with each of the factors of this chain. Let's decompose a little further.
So, we have:
It directly correlates with the choice of location. Chose a place well - the cross will be. Chose bad - will not. Obviously, if you’ve done something wrong at this stage, the Khan’s store. I talked about this a lot and on Habré, and about one fifth of the book “Business as a game” we have about it. The easiest way to kill a business before starting is to mess up with a place.
2. Conversion in calling depends on:
- Brand awareness.
- Quality design.
- Manufacturing quality of the input group.
- Cleanliness and order in the store.
- The attractiveness of the storefront and general store.
Brand awareness is a matter of master franchise, that is, a local store can hardly affect it. Conventionally, this multiplier makes the head office. For example, when you read this post, it is no, no, but growing. A shop affects this to a small extent, unless it has a fail-safe method - you have to stand still 10 years, and then it will be not just a store, but “a store that was here in my childhood”.
Quality design also sets the network. This is a set of layouts, conditionally, or a block and rule constructor that allows you to create these layouts. For example, we have one of the problems that many are trying to tactically win, breaking these very rules. Sometimes this is really reasonable, but more often it is not, because there are crutch solutions. The quality of the design of the store also can not influence.
But on the quality of the performance of the input group and other elements - yes, and right. Outside makes the owner, and he fully affects how everything will be neat.
Then cleanliness, order and everything that is behind the glass of the shop window are important - this is influenced by the specific change of sellers inside the store. And they need to be checked from time to time.
3. Conversion of those who come to those who buy depends on:
- Item Type
- Quality Service
- Rules calculations
- Quality calculations
Type of product - everything is very simple. Bread is bought more often in bread than jewelry in jewelry. This is a kind of constant in the industry, conditionally.
The range is what usually happens in the store. For example, an emasculated case is this: an assortment of the same bread can include your favorite cake, Borodino bread, and cartridges for a gun. Then in it hunters will go, leaving on a distant boundary. It is worth removing the cartridges - the sales of bread will fall. The choice of assortment directly affects the owner of the store, and this is reflected in the procurement policy.
Availability is when the range is always available (or not). For example, in our example about bread cartridges, there is always, but black bread ends at lunch. This means that the store works with lower efficiency the second half of the day. Spaces at any time are lost profits, and a lot. The maintenance is affected by the purchaser and the store owner.
Calculation rules are order, structure and navigation in the store. I'll talk about this in more detail later. The rules of the calculation affects the master franchise, that is, the rules of the network.
The quality of the calculation is the level of implementation of these rules by store employees. Directly affected by the change, which is now inside.
Prices are the least significant factor in the chain (but for some reason it is given the most importance). It is clear that they should be approximately in the market, plus or minus 15 percent (for different industries there is a different dispersion). The main thing to understand is that prices can almost never be a competitive advantage in any remote strategy. But dumping in the new market is cool and fun.
Block of outside people
Here we are interested in the classic omnichanal - there is a funnel from advertising, pieces like the site, and so on. About each of these blocks, you can talk for a long time separately, so let's just limit ourselves to the fact that it is magic that makes people break away from the sofas with the sound of “pops” and come to the store. For some reason they do it. Just take into account that considerable merit here range. For our model “what to do in the store and within a radius of 15 meters from it” is not very important.
Number of purchases
The bottom line is that we have funnels of people who add up to the number of purchases. It remains the profitability and the average number of items in the check.
Profitability depends on how you have built a financial model, in particular, it affects the ability to get the best conditions for the product (affects the owner or purchaser) and employee motivation system (affects the owner).
The average number of items in a check depends on the motivation of the sellers and their training. The better they know it, the more they sell. Generally, the average check should be more than one product. If, for example, there are 1.2 positions, then this means that your sellers do not work well (again, an example of us, if this is 1.2 apartments in the check, it is wildly cool).
We have in the check from 1.4 to 2.2 products. But people very rarely come to our store to buy two games. He comes for one game, and on the spot already chooses something second. This is a spontaneous purchase. This is when he saw something cool (or played with him).
Business rarely costs on a single sale. One branding guide somehow suggested to me that even children's coffins have some retention (customer retention rate). If we talk about ordinary goods a little less sad direction, then the cycle looks like this:
- Contact with the client several times to form his need or recognition.
- Attract to the first sale, that is, to pay a marketing and advertising deduction for the first purchase.
- Then from time to time to return the client, attracting him for much less money.
Simplify the task to our store. The goal is for a person to find out something about board games or just pass by our alluring sign in search of a gift. He will go, will buy, we will pay a certain amount for his attraction. Then, if everything goes well, he will come back about once every six months for a new game. This is if you do not touch it.
Is it possible to make people return more often? Yes you can. For this you need to grow the service. For example, I personally know a person who went to a cafe with a beautiful waitress for three months in a row to have lunch. During this time it would be possible to meet, but he just dined. I do not think that he was directly critical there is there, but the additional service pleased. Or here is one large grocery store that sends discounts on dairy products, if you used to buy them, and now you have stopped. And so on.
When a person returns, is it possible to make him buy more? Yes, it is necessary to increase the range and better solve its need. We have more games, new products suitable for his company - and now someone comes to buy gifts for the new year not only for one friend, but for everyone he knows at once. And in general, familiarly looks in our store when you need something to give someone. In general - ready.
It remains only to bring the idea that the games in the family help to communicate, that it would also be nice to take a couple of nastolos on the road, and that the child, playing at this, is getting smarter. All this is proven, it remains only to teach.
Get the maximum rate of return and the maximum average check.
Customer focus is a means to do more than expected at each point of contact.That is - indirectly remove barriers to repeated and more frequent purchases.
Customer orientation begins, oddly enough, not at all with something to improve. It starts with cleaning up something that infuriates people. We at one time made a list of what can enrage people:
- Near the store is dirty, slippery, one of the two doors is open, a puddle is poured.
- Sellers are rude, stick, ask unnecessary questions. When needed - not found. Help without joy. There is no one to contact in case of a problem, everyone doesn’t care.
- Sellers do not understand the product, do not know its features, lie, vparivayut. It does not feel that they are on your side. Work on the script. Drink tea in the hall.
- On sale there is a marriage, expired products.
- Loud music in the store, not the music, intrusive audio ads. Too cold or hot in the store. Bad light.
- Funny price tags like a discount of 5 rubles, stocks are not like stocks, before the discount prices are inflated.
- The package is difficult to open, the carts are crooked. Scales are inconvenient to use, or they are not.
- The queues. Trifles at the box office there. Packages cost horse money. There is no payment terminal. Return of goods is a degrading procedure.
- Unexpected interruptions in the work schedule, inaccurate (up to a minute) compliance with the schedule.
- Sellers comment on the behavior of buyers.
- The price is written for 80 grams. Shares in small print and from a pile of conditions.
- The floor is slippery.
- Security thieves and rude.
- They shove advertising in the boxes and in the door, send SMS, bonuses suddenly reset, "Your call is very important for us" on the hotline.
UPD: here in the comments miksoft added more points .
And so on. We must begin with the elimination of all this. And it will immediately become better. Elementary clean up to the purity of the store, then walk on the famous schools. And then just go to someone else's shops and think what infuriates you. And check right away - do they have the same? We do this from the first days. And yes, they themselves also had a lot of things. Now much less. But it still gets out regularly. And this is not a one-time process, the more conditions - the harder it is to support each of them.
Therefore, customer focus is not some abstract property of a business, but quite a concrete thing from a business model. Customer focus can be assessed by a bunch of factors, of which the simplest is this figure:
The very same LTV or Lifetime Value - is the amount of money that a person will bring you all the time. It is obtained from the indicator of returns multiplied by the average check. If we talk about the bakery near the house - LTV is huge, and ruin the attitude of a rude saleswoman is very simple. Therefore, the owners of small shops are the most lovely and friendly people for “their own”. Especially when there is at least a second store in the village.
You can count the metrics of each store parameter and affect them. You can figure out that most of the metrics should not be defined by the store itself, but by another structure above, which is capable of strategic predictions. In the “shop is a tool for processing goods” model, local points can only be tactical plans, which often ends in sadness. Understanding the influence of “abstract” factors like customer focus helps to correctly put all this into the numerical model and finances in the end.