“There’s so much product I want to carry—but I don’t know how to choose!”
If you’re like most retailers, you see enough tempting product at trade shows, magazine ads and catalogs to fill a store. There’s only one catch: It can’t all possibly fit into your store.
You know the impact your buying decisions have on your bottom line. And you don’t want to regret those decisions six months from now, when you’re marking down unsold merchandise. So how do you choose? If you want to make a statement and maximize your competitive advantage, you need to buy like a pro. Here’s how:
Know your vendors. Manufacturers invest time, money and energy researching the market trends and developing product to meet customer demand. Get to know your vendors—and you’ll learn why product was developed and how the manufacturer plans to market it.
How important is marketing? Vendors who emphasize marketing enjoy increased consumer awareness, brand loyalty and a larger market share than their competition. What does it mean for you as a retailer? Simply this: Your customer will know the product brand and item when she walks into your store to buy. It’s the easiest sale you’ll make.
Monitor the trends. Magazines, both trade and consumer, are a vital source of trend and industry information for buyers. Consumer magazines lead the market in trend and drives demand for scrapbooking; be sure you know what’s advertised and editorialized in the latest issues.
For another glimpse into the minds of scrapbooking consumers, check out the many online message boards, where opinions on product and techniques is discussed. Two Peas in a Bucket, CK message board and Scrap Jazz are a few such message boards.
Know your market. Hands-on knowledge is key to profitable buying decisions. Good buyers know the product, know the category and know the customer before they buy anything.
In fact, you must know two levels of the customer: the paper crafter, and the paper crafter who shops at your store. Be aware of current general product and technique trends in the market, as well as the trends your customers are interested in. Your local demographic will impact the trends for your customers—don’t forget, what sells brilliantly for the store in the next city might not be popular with your customers.
Monitor your store’s product categories and customer buying habits to understand consumer preferences. Listen to what your customers say through their buying patterns—they are your best resource.
Don’t buy what YOU like…at least, don’t buy ONLY what you like! It might surprise some buyers to learn that passion for a product can harm rather than help store sales. The truth is that buyers don’t have to be passionate about the category or the product they buy. Maintaining objectivity, however, is vital. Archiver’s is one such example. Created and managed by a group of non-scrapbooking businessmen, it’s flourished into a successful multi-store chain.
Any tricks to maintaining objectivity? Soliciting input helps with buying decisions. As one retailer says, “I love all the products I buy, but to stay objective I ask for opinions from my colleagues, store personnel, teachers and customers.”
Approach new products with a buying strategy. Do you stick with the tried-and-true product mix, or risk precious floor space with an unknown product line? Do you cherry-pick or implement the entire line? How does a pro approach new product? With a strategy.
“New products are evaluated to determine if they have an intrinsic appeal, will add significantly to their category or if they fulfill a customer need,” says one craft store buyer. ”New categories are evaluated to determine if they would appeal to crafters who do similar successful crafts or meet a need.”
Don’t cherry-pick the line. Professional buyers agree: The smartest thing to do is make an initial purchase of a complete line instead of selecting one or two items from multiple lines. After six months, review sales of the complete line as well as sales of individual items, then replace the bottom sellers with new items.
“But that’s too expensive!” you might say. Actually, it’s not, if you buy wide and buy shallow. Buy the entire line, but order the minimum number per item. Rather than purchasing six packages of three items, you’ll purchase three of six different packages. It costs the same amount of money, but you get a wider assortment of product—and it’s that variety that will make an impact on your customer.
In fact, having two or three stray pieces from a line actually have a detrimental effect in the eyes of your customer. Those products won’t sell because they’ll become invisible among your other merchandise. Just imagine stocking two or three Cardmaker’s items. How much more of a statement you would make by carrying the entire line, merchandised together with the appropriate signage. After all, a product line is meant to work interchangeably. For example, all Cardmaker’s™ items show complementary product from the same line on the packaging. What will you tell your customer when she asks for the coordinating product—which you don’t have?
Shop your competitors. Check the stores in your area once a month if possible. It doesn’t need to be a thorough search; enter the store as if you were a consumer looking for a certain product. Analyze the store from the customer’s perspective: can you find the product you’re looking for? Did you find other products? What does this store have that yours doesn’t? And how does your store compete with theirs?
Look at the bottom line: Stocking shelves with pretty product is only one part of retail store buying—yet too many buyers stop there without analyzing the bottom line. A store full of product that moves slowly or has low margins is not generating a profit. When product doesn’t perform, it’s time to mark it down and get it out of the store.
Yes, this means even the product you love, the product you were sure was a winner, the product you personally use. If it doesn’t sell, it doesn’t matter how dear it is to you—it’s taking up space and it’s taking away from sales. In any business, there’s a bottom 20% of inventory that’s simply not moving. Identify that bottom 20% and move it out: put it on sale, give it away, auction it off as part of a promotion…whatever it takes to make room for the new product.
Trade show shopping. Shopping trade shows for the latest, hottest, sure-fire product can be wearying for even the hardiest retailer. Preparation can make all the difference when it comes to maximizing these opportunities.
Make it a priority to attend shows. The rewards will far outweigh the cost of tickets and expenses. This is your chance to take classes on the newest products and techniques and attend marketing and retailing seminars. It also may be your only chance to network with other retailers, and it’s the best way to get a sense of the newest trends and styles in the marketplace. If you’ve done your homework before the event and figured the items or categories you want to buy, shopping the show is relatively easy.
“Trade show productivity is directly correlated to the preparation,” says one craft store buyer. “We lay out our route using maps, plan our objectives by vendor, plan to make decisions and we look forward to seeing new products and getting a feel for the direction the industry is taking.”
Smart buying for solid sales. Gathering market information and industry knowledge. Attending the trade shows with a shopping plan. Buying with a clear strategy based on objectivity. And most important, purchasing product that will move fast and generate sales. Whew!
While there’s no magic formula to smart buying, there are buying tactics that any retailer can implement.
“Trying to buy products with good margins that will turn quickly is a big job,” says Paulette Jarvey, President of Hot Off The Press. “And while there’s certainly no magic formula, there are buying tactics that any retailer can implement. Don’t forget your vendors can help you with market research and industry information. We create product because we believe it will sell—then we put the marketing effort behind it. Let us be a resource for your buying needs.”
