When retailers are considering a strong
promotional event, the most frequently asked question (FAQ) we get
is “Why can’t I do it myself?”
Maybe you can. Our
free, open, no-questions-asked, five-point self-evaluation
checklist will help you decide.
The Five (5) Critical
Ingredients
for a "Do It Yourself"
Promotional Sale
1. Money
Financial distress can enhance a promotional
sale opportunity; but financial distress is a serious obstacle to
implementing the sale. Negotiating and purchasing advertising,
labor, supplies, real estate and inventory to balance existing
stock must be performed efficiently and well. A weak negotiating
posture or even minor distractions can be fatal.
Cooperative vendors enjoy fueling the promotional sale; and
terms will always be more favorable to a credit worthy customer.
Partnering pays great dividends here.
2. Wisdom
Blueprints and axioms gleaned from
“experts” will be helpful for orientation; but rigorous
planning and intelligent decisions, based on comprehensive review
of day-to-day results, need to happen quickly.
When you do a normal month’s business in two days, your
sense of time needs to contract proportionately.
More important decisions need to be made in shorter time
frames. The creative,
fashion gene that so often defines successful retailers plays a
minor role here. The
plugger, the planner and the thinker inherits the temperament to
star.
3. Focus
The most effective promotional sales arise
from circumstances outside the control of the retailer and create,
in the mind of the consumer, a “once in a lifetime” urgency. To effectively manage the project, the retailer must adopt a
similar attitude. If,
as in the case of closing part of a multi-store chain, for
example, the promotional sale is not the core business for the
retailer, his leadership roles conflict and one business or the
other will suffer. Similarly,
when serious financial or personal distractions require
significant attention from the retailer, the promotional sale is
weakened. Unlike traditional retailing, where each season creates a
benchmark for next season, most retailers get only one chance to
run a major, not business-as-usual, promotional sale correctly.
4. Experience
As our industry consolidates, promotional
sales to facilitate changes in the retail environment become more
frequent. Whether as a customer, a competitor, an employee, a
casual observer or a principal, many retailers are not total
strangers to the process. Here is where a little knowledge is just
enough to be dangerous. Even
a retailer who has worked previously as a client of a professional
promotional sale company over the course of an extended and
successful promotional sale, may not be qualified to do it on his
or her own. This
experience is valuable, but many of the analyses and thought
processes of the professional occur below the observation horizon
of the client.
5. Risk Tolerance
Often the retailer arrives at the promotional
sale crossroads feeling burdened, confused and uncertain. Even for an affluent owner with no financial pressures,
issues of legacy, community status and impending retirement can
challenge his/her sense of self worth.
This is hardly the best condition to take on what may be
the most potentially profitable undertaking of a business career.
Typically the volume potential of the promotional sale will
gain momentum and take on a life of its own from the first
announcement of the event. An
aggressive merchandising plan, therefore, requires topside loading
of inventory, advertising and personnel.
The enthusiasm that flows from a successful break must be
tempered by knowledge of the typical falloff and new pricing
required to reenergize the sale.
Defensive merchandising leaves profits on the table; but
those same profits dissipate quickly with markdowns required to
bring the inventory to zero.
Congratulations! You have completed the
checklist. How do you
rate yourself?
If you would like us to call you for
further confidential discussion of your own situation, at no cost
to you, click
here.
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