4 reasons your retail store is losing money and how to turn the tables

When I first meet with a retailer, I ask them why they opened their store. And of course, the reasons vary dramatically. But what generally comes up are these 5 things. To have more freedom to spend time with my family

4-reasons-your-retail-store-is-losing-money-and-how-to-turn-the-tables

To not have to work as many hours  andTo not have to work in a rigid corporate environment

To make more money

Because I love this thing I sell and wanted to share it with others.

Sound familiar?

And to tell you the truth, MOS of those things are the reasons that small business retailers ended up closing shop within the first 3 years.

So why are those the wrong reasons to open a retail store, and how do you turn them into the right reasons?

Reason number 1 and reason number 2 go together

To have more freedom to spend time with my family, To not have to work as many hours

This one is often the first reason that comes up. And I ALWAYS tell my clients that if this is the reason why you want to open a store, then go get a job. Because the first 5 years in business will mean you are working A LOT. And you’re bound to feel bad about the amount of time that you’re investing on getting this thing off the ground.

So how do you turn that around.

Simply, from the outset, you need to work out a budget that allows you to hire staff right from the outset.

And when you tell me that you can’t afford it, I’ll tell you can’t afford NOT to.
And that you should have worked the numbers, right from the beginning, to ensure that you had help.

Because when you’re in retail, you need to be the buyer, the operations manager, the HR manager, the marketing manager, and a host of other roles.
You can’t do all of those AND work in the shop.

So whilst you did this to escape the corporate box, have you just jumped from one box, into another?

Reason number 3

To make more money

Ca-ching, this is the one I really want to talk about today

To make more money.

And how’s that going for you.

Are you making more money that your ‘corporate job (and I’ve done my research you did have a management or corporate job before this). Are you working less hours? Are you spending more time with your family.

Most people answer no to this question. If you can answer yes, then here is a virtual high five straight at you.
But for those of you that answered no, you wanna know the reaons why?

I’m pretty sure you opened this store expecting to work in the store until you could afford to hire more people, right.

It’s a mindset thing. When you started out, you didn’t have the right mindset. You were thinking small, and thinking small keeps you small.
So how do you turn the tables on this mindset that’s keeping you small.

Well, you could go and get and lot of mindset coaching, or quite simply, you could sit down right now, and work out what delegating a bunch of your work would do for your business, what you could achieve if you had that time back, and how much it’s going to cost you. Then, work out a way to generate the income that you need.

The universe is a funny thing, If you set intentions, quite often, what you needs comes to you in the most round about ways.

Try it – what’s the worst that could happen?

And the last reasons – to sell things that you love, and share them with others.

Now this can be a great catalyst for opening, but one of the key reasons that independent retailers fail, is that they buy what they (and their friends) love, and NOT what their customer loves.
I can guarantee you ,that your friends are not going to make up the 20% of your customers that give you the 80% of revenue. In fact, what you may well find, is that under some strange set of circumstances, your friends all of a sudden shop elsewhere.
I’m yet to find why this phenomenon occurs, but it does seem to hit most retailers.

4-reasons-your-retail-store-is-losing-money-and-how-to-turn-the-tables

So let’s just recap.

To turn the tables on being a #retailfail, you should

Work less

Earn more

Budget for assistance

Think bigger – change your mindset

And

Know what your role in the business is, and that has to be as the business owner, not as a shopkeeper

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