0:00 You know that feeling when you're about to place an order. I don't know about you, but I used to get that little flutter of excitement. And it was kind of tinged with a bit of a fear of anxiety. So you're looking at the screen, or maybe you're looking inside of a supplier portal, or maybe you are literally standing in a showroom or you're at market, and you're pointing at samples saying what you want.

0:25 And if you're anything like me, in the back of your head, you're doing... the math. Okay, if I order 12 of those and six of those and should I order two colors or should I order three colors just in case?

0:40 But underneath all of that, there was this knot of anxiety, which was, I hope these sell. When the stock arrives, I remember posting on Facebook back in the day, like 2007, 2008, where we could post, Selena is feeling excited about...

0:58 unpacking a box from such and such supplier. I mean, do you remember the days? I don't know, if you've been around as long as I do, the days when you could post something as simple as that and you could get hundreds and hundreds of likes, no pictures. Oh, bring them back. Anyway, the stock arrives, you unpack it, maybe you need to photograph it, you post about it, you launch it, and then it's crickets.

1:25 Sometimes it sells, but Even worse is when it sells slowly. Now, not enough to feel like a win, but just enough for you to keep from just writing it off in general. So what do you do? Well, if you're anything like me and most of the people that I talk to, when something isn't moving or it's not moving as fast as you want, you end up discounting it and or you end up panic posting.

1:57 or you bundle it with something else and you order more stock to try and fix this problem that you think more stock, more volume, more variety is going to fix. But what happens is the cycle repeats. And here's what I want you to know.

2:14 There's probably a pretty good chance that you're not bad at buying. I mean, you wouldn't still be in business if you couldn't choose good products. I believe that you're just starting in. the wrong place because most retailers treat ordering as the starting line and the selling part only comes after the boxes show up.

2:37 And that one habit, that order of operations is quietly creating, I don't know, every problem that you complain about, but probably a lot of the problems that you complain about. Because at the end of the day, money can fix most problems.

2:54 If we have more money, we can hire more people, we can put more resources in, we can buy more product, we can do a lot of things with money. So if your product isn't selling, the symptom is that you don't have the cash flow that you want.

3:05 That's not the problem. That's just the symptom. I think there's an operational problem here that we can fix. And today I'm going to flip the script. I'm going to show you why selling shouldn't be the reward for ordering.

3:19 Selling should be the filter before you order. And when you get this right, everything changes. Welcome to the Bringing Business to Retail podcast where we talk all about solutions and strategies to make your retail or e-commerce store more money.

3:35 Alrighty, I really want to share this with you today because I feel like it is a game changer for so many businesses. So let's jump in. Let's be honest about what's really happening when you place an order.

3:46 You aren't buying stock. You're actually buying money. You're buying a belief and you're buying a belief that it will sell. So you're buying hope. I believe you're buying cash as well because that's what the stock is there for, right? The stock is there to make us money.

4:06 But underneath all of that, what you're really buying into is a belief that you have a product and people are going to buy it. Your customers are going to love it and that it will move fast enough to free up cash for the next thing, to be able to pay all your bills and to put money in your pocket.

4:22 Now, I'm not going to judge that belief because the reality is that's how most of retail works. But here's the problem. Hoping that something sells is not a business strategy. It is not a marketing strategy.

4:37 Because when that stock doesn't move the way that you thought it would, you're left with one option, or at least the option that feels the most immediate. You end up discounting it. And that is not wrong. The simple fact is you have to recoup that.

4:51 cash. So you run a sale, you create urgency, you shout louder on social media, you photograph it 17 different ways, hoping that something will click and you move it around your store to every part that you believe is a hotspot.

5:06 Now, maybe it works and maybe it doesn't. But either way, you've just trained yourself and your customers that the best time to buy from you is when you're desperate. So I want to pause just here because this is not about blame.

5:22 We will all buy the wrong things at wrong times. The retail model that we've inherited is set up this way. You see something at market or you see something from a supplier, you love it, you order it. you receive it, you sell it. That is just how it's been done.

5:39 But what if the reason that you're constantly stressed about cashflow or constantly trying to guess what will work, constantly stuck in this discount mode is because you're stuck at the wrong end. Let me walk you through what actually happens when ordering comes first.

5:57 So you place the order. Now maybe it is $1,000, $5,000, $10,000, $20,000, $30,000. Once you place that order and you pay the supplier, that money is now gone. It is dead to you. It is tied up. It is tied up in boxes that haven't even arrived yet.

6:15 And then the stock comes in, hopefully. And one of three things happens. Option number one, it's a bestseller. You celebrate it and you watch the sales roll in. That is the dream. Option two, it sells, but it's a little bit slower than you hoped.

6:32 So now your cash is still stuck. You can't reorder those bestsellers because the money is sitting in something. Now that's moving, but it's not flying out the door and it's tied up. And that's what we're trying to talk about here is that every item from the minute you pay the supplier until it sells is money that is tied up.

6:56 So what I tend to see when you have a lot of aged inventory is that you start making. fear-based decisions. So you'll start making things and maybe some of these will resonate, like I can't afford to order more than just a few SKUs, or I can't afford to, we say order deeply, I can't order deeply into that particular product.

7:20 So I'll just get a few of all these other things and hope that something sticks. So instead of getting a lot of hopefully quantity and quality. You're going for a little bit of everything. Now, that in and of itself can create a whole bunch of problems.

7:36 But you may be doing that because you're trying to make your store look full. Now, I'm not going to get into the pros and cons of that type of strategy just yet. But what I want to highlight here is that if you have a product that sells consistently and you're not ordering deeply, then we are still making those fear-based decisions, all those. cross your fingers and hoping decisions.

8:01 So your stock is tied up because that stock isn't moving as quickly as you wanted it to. Have you ever found yourself in that position? Surely you have. Every retailer I've ever met has been in that position.

8:13 So option one, it's a bestseller. Option two, it moves, but not as quick as you want. Option three, it just doesn't sell. We have a joke here in our company. We call them the bedazzled tiger t-shirts because we once had a client who all of her customers said that they wanted these sequiny type tiger t-shirts.

8:36 I'm probably not doing them justice. She ordered a whole bunch of them in and no one bought them. So our little in joke, if we ever work with you, we talk about the bedazzled tiger t-shirts. So the bedazzled tiger t-shirts are the stuff that you buy that just doesn't sell.

8:52 Three months later, The majority of it is still on your rack or it's in the storeroom or it's in your warehouse. So now you are literally stuck. You've got dead stock. The cash flow is tied up. And when that next market or that next supplier comes around, you have to make this or that decisions because we all only have so much cash to buy stock.

9:14 So you're thinking, well, do I order the thing that was working or do I try something different and just hope that it works? Either way, what I inevitably see happen is that the onflow of that is that your marketing becomes very reactive.

9:29 So you start posting about products because you have to try and sell them, not because they're in your marketing plan to sell. You're trying to create urgency around stock that your customers have seen for a very, very long time.

9:44 And you are literally crossing your fingers and hoping that someone buys it. And when they don't, you have to move it on. You have to discount it. So... Here's what I need you to hear. Doesn't have to be this way.

9:57 Just like so many suppliers rely on indent ordering for you having to pony up the cash for them to fund their manufacturing runs. you too can flip the script. Because when you order first, you make decisions in a vacuum.

10:12 You are literally guessing at what will sell. And then you're spending the next three months trying to prove that your guess was right. But what's the alternative? Well, it's as simple as stop treating ordering as step one.

10:27 Instead of buying it, receiving it, photographing it, uploading it, launching it, hoping that it sells, and then maybe discounting. What if you did this? You tested the product. You validated the product.

10:40 You proved that someone wanted it. You had the money to order it and then you delivered it. It's a little bit different, right? Selling before you order means that you find out if people actually want it.

10:52 Not the poll that you put up that says, would you buy this? But they are ponying up their cash to tell you that they actually want it. So this means that you reduce your risk. It means you... pull that money forward, you make smarter buying decisions because you're working with proof and not hope.

11:09 And here's the kicker. When you sell first, you don't have to discount because you are not stuck with stock that you are trying to move. You're fulfilling demand that you have already captured. I know what some of you are thinking.

11:24 Well, Sal, that sounds great in theory, but my customers would never go for that. Now, honestly, I would say most of the time that I suggest doing this? nine out of 10 people that I consult to tell me that they can't do it.

11:38 And that is exactly what we're unpacking next, because the reasons you think you can't do this, and I'm going to give you some examples. Trust me when I say they're not as real as you think they are. So let's talk about what's actually stopping you, because I promise you it is not logistics.

11:54 It is not that it doesn't work in your niche. It's not even the type of products that you sell. Honestly, it is your bias. And I am more than happy. for you to prove me wrong. So let's dive into the top three objections that I hear about selling before ordering, and I will give you proof that this works.

12:14 Okay. Reason number one, my customers won't buy something before it isn't here yet. And I'm going to lump into this category, pre-selling doesn't work in my niche. Those two things sound kind of the same, but these are the two big arguments that I hear.

12:32 My customers won't buy it if it's not here. And it just doesn't work. It doesn't work for my products in my niche. And I have to laugh at this because I have heard this so many times right before I prove retailers wrong. Not they prove me wrong. I'm more than happy for you to prove me wrong because it means that you tested something.

12:52 But I want to tell you about Rachel. So Rachel has a fabric store here in Australia and she was going overseas to the buying fairs. Now, obviously, it's a... big effort when you're going overseas to find product.

13:04 It's very expensive. So you have to be very, obviously when you're bringing that product in, there's also a lot of cost as well. So you have to be very confident in what you're going to sell. So she was facing this scenario, a lot of money going out, currency conversions on everything.

13:23 And she did not believe that she could pre-sell. So we had a conversation with her while she was there doing the buying. It's interesting. because when we brought this up, we were like, okay, why don't you go live, see what people want to buy and then get them to pay for it.

13:41 If they say yes, that's an indication that people might want to buy, but when they pay you the cash, it is a guarantee that someone wants this thing. So we said, do that and it would be a perfect way for you to test out what to buy.

13:57 But then the second part of that was actually selling. She swore black and blue that this would not work because there was a brand in the industry who had done this before and not delivered. And so apparently every customer would not order before the stock arrived.

14:19 They would not buy in a pre-sales campaign. This is not just going live while you're at market. And when we do that, it's easy for people to get caught up in the hype. And it's easy for people to say that we want something just like the bedazzled tiger t-shirts.

14:37 But what I want you to prove here, that proves there's interest. It doesn't prove there is demand. And demand is what is going to pay the bills. So yes, 100%, go live on your Instagram, put pictures up to gauge interest.

14:53 But that is not gauging demand. So I just wanted to make that little clarification point. Back to Rachel. And I swear that she did this pre-sales campaign just to be able to say, I told you so, it doesn't work.

15:10 And so we convinced her. We're like, what's the harm? If no one buys it, it didn't cost you anything. And so Rachel decides to do a pre-sale while she's at the trade fair on a pair of scissors worth $400.

15:28 Do you see what I mean here? I swear she was doing this to prove that it doesn't work. And I'm going to be honest, I was a little bit hesitant. Who spends $400 on a pair of scissors? Prove me wrong, because a lot of people would spend $400 on a pair of scissors.

15:47 So it turns out in a niche where apparently pre-selling has been ruined in this industry. Because what happened? She sold all that she was able to get while she was at the trade fair. Like she literally went back. to see how much more she could get and sold out.

16:04 So here's what I've learned. Your customers, no matter what you think, will absolutely buy before the stock arrives if they trust you and if they want the thing. Think about it. We pre-order books. We pre-order concert tickets.

16:21 We pre-order limited edition sneakers. I mean, people will line up out the door to pre-order an iPhone. Kickstarter campaigns do it. Subscription boxes do it. These days, we are used to the model in our life.

16:35 We are used to having to pay for something that we really want and wait for it. Even in this moment where every scroll is immediate gratification, if we really want something, the simple fact is we will wait for it.

16:49 So the question isn't whether they'll do it. The question is whether you're giving them the reason to. So the fix is just make it worth their while and cash in on the process. Alrighty. So that is hopefully myth busting number one, that it doesn't work in your niche and people will not buy it if they can't get it straight away.

17:08 All right. Reason number two, my customers will be angry if they have to wait. So this is a big one. This is the fear of backlash that you are really worried that if you ask someone to buy something and it isn't in stock yet, and it doesn't turn up on the exact date that you believe it will, that your customers are going to get angry, that they'll demand a refund. They'll leave a bad review and they'll never buy from you again.

17:33 Well, I'm not going to pretend that that has never happened. But here's the truth. Customers get angry and you're a customer. You think about this when you have had to do this at somebody else's store.

17:43 We get angry when our expectations aren't met. So if you're saying buy now, then they may well assume that it's shipping tomorrow and then it doesn't. So yeah, that's a problem. But if you're really upfront and you're like pre-order now.

18:00 This is a pre-order. It's coming in four weeks. You're locking in your spot and you're getting early access. That is a totally different conversation. Let me tell you about Kira. Now, these are all real retailers and I love that I am able to trot them out.

18:15 It's a little bit self-validating that sometimes I'm right and I know what I'm talking about. But more importantly, it proved a model for these retailers that means that they are no longer having to pony up the cash for something that they don't know if it will work.

18:32 Because trust me when I say I have invested in very expensive stock before thinking that customers would buy it only to have crickets, even though everyone swore black and blue that they wanted it. So back to Kira.

18:47 So she found herself in this situation. She sells yoga clothes, yoga clothes. I think that's the right word, yoga clothes, yoga gear. And she had decided that you She was sick of Sal harping on about pre-sales campaigns and that she would take the leap, she would run a campaign for a production run of her latest print in one of her best-selling tights.

19:11 On the surface, it went well until it didn't. Those tights didn't arrive when they were supposed to. So the manufacturer had issues with the fabric or something, and then the delivery got stuck in the ports.

19:25 It was just... It was just one thing after another that was completely out of Kira's control. Did the customers get angry and demand refunds? Yes. One. One person asked for a refund because it was a present.

19:41 That one person didn't get angry and troll her on Instagram. There were not hordes of people asking for their money back because we had already mapped out the contingency of what would we do. if this happened and how it was going to be communicated.

19:59 And she just put that process in place. So out of the, I'm going to say there was like 150 orders, one person, one person asked for a refund. Now it doesn't mean that some people weren't a little bit upset that they didn't get it.

20:11 Everyone gets a little bit upset if you don't get something when you think you're going to get it. But the reality is it didn't cost her any money, one refund. So just a quick recap, we aren't not selling before we order our product because it won't work in your niche or your customers won't pay up front.

20:28 you customers will get angry if the product doesn't arrive when you say it will. The third reason is that you just don't know how to do it, that you just don't know how to run a pre-sales campaign. And that's honest. There's a lot of things we don't know how to do. I respect it when someone says, I just don't know how to do that.

20:48 We don't know what we don't know. Now, a lot of you have never tested demand before buying. Yes, you may have gone on Instagram and you may have put product up. Remember, that's interest. If someone says they want something, it is interest. When they pay for it, that is demand.

21:03 So you may not have tested demand before you've bought before. You may not have set up a pre-order campaign and maybe you don't know what to say or where to say it or how to make it feel normal. And that is fair.

21:16 But here's the thing. You can learn that stuff. You don't need a perfect system. You just need a system, a product, an offer, a way to take payment. and that's it. So, I mean, I have seen pre-sales campaigns go from literally, you know, there's a little bit of a tech setup.

21:35 If you want something, if you have a large volume and you want to be able to do this automatically, yes, there is a bit of a tech setup. But the reality is when I get people to test this, most of the time I'm getting them to test it on social media with someone replying sold or reply to this email if you're interested and they're manually sending invoices.

21:56 It doesn't have to be a huge thing. Now, yes, if you're doing your own production runs and you want to automate this and you have hundreds of orders coming in, of course we want to automate it. But if you just want to test this, as long as you have the right product, the right offer, and you can market it to your people and you can take their money, that's it. That's all you need.

22:19 So it doesn't have to be huge. It doesn't have to be like... edgy and experimental. It's just smart retailing. It is just reducing risk. It is pulling that cash forward and making decisions based on proof and not hope.

22:37 I'm hoping that the takeaway that you're getting from today's episode is that the retailer who's going to win is the one who's got the cash in their product, but the retailer who's going to win is the one who has the cash in their pocket because they have collected the proof before they've ordered.

22:53 And here's what I want you to leave with. As much as possible, I really want you to stop discounting. And the best way to do that is to start with your ordering. If you want to stop tying up your cash in stock that sits, if you want to stop guessing what will work and then spending months trying to prove yourself right, you have to stop treating ordering as the first step.

23:18 It isn't the starting line. Selling is the starting line. And when you flip that, everything changes. Your cash flow improves because you are not funding everything up front. Your buying decisions get sharper because you are working with real data in real time, real demand.

23:36 Your marketing gets easier because you are not scrambling to try and move the stock that nobody wanted. Instead, you're fulfilling demand that you have already captured. And your customers? Well, here's the thing. Pre-selling makes them feel...

23:50 more indebted into your brand. They feel like insiders. They feel like they are part of something, like they got in early. And that is the business that I want you to build. Not one where you're constantly chasing, not one where you're stuck in discount mode, but one where you are leading, where you're confident and when you're in control.

24:08 And it starts with one simple shift. Sell the product first. If you're listening to this and thinking, okay, Sal, I'm sold. Hopefully I have worn you down like I wear most people down. But if you're thinking that and you genuinely don't know how to start, I've got you. Because I went and created something specifically for this.

24:29 So I've been using this with my consultancy clients, but I've decided that there's a lot of indecision in retail right now. So let's give you some decision making. So I am now releasing my pre-sales campaign toolkit for you.

24:45 It is a plug and play system that walks you through how to exactly come up with your offer, how to test demand, how to click the payment, and how to fund that next order without complicated tech. There is some complicated tech stuff in there if you need it, but without the complicated tech, without a massive audience, without... guessing. It is a step-by-step toolkit that walks you through how to come up with your offer, then plan and launch and execute the whole campaign in just a weekend so that you get paid before you place the stock order and you stop guessing what will sell in just 72 hours.

25:21 I don't know about you, but that, that's my instant gratification, cash in my pocket that quickly. It's not theory. It is literally the system that I use with my consultancy clients. and it is something that you...

25:32 can implement this weekend and you can use it to generate cash without discounting. So if you are ready to stop ordering first and start selling first, I want you to go to selenaknight.com forward slash toolkit and you can grab it because the retailer who wins isn't the one with the biggest budget.

25:50 It is the one who collects the cash before they order. And I want you to make sure that's you. You can grab the pre-sales campaign toolkit over at salenaknight.com/toolkit. Alrighty guys, thank you so much for joining with me.

26:06 I hope that this has been helpful for you and I'll see you on the next episode. So that's a wrap. I'd love to hear what insight you've gotten from this episode and how you're going to put it into action.

26:19 If you're a social kind of person, follow me @thesalenaknight and make sure to leave a comment and let me know. And if this episode made you think a little bit differently or... gave you some inspiration, or perhaps gave you the kick that you needed to take action, then please take a couple of minutes to leave me a review on your platform of choice.

26:41 Because the more reviews the show gets, the more independent retail and e-commerce stores just like yours, that we can help to scale. And when that happens, it's a win for you, a win for your community, and a win for your customers.