Retailing
Retailing
Marketing
When you have decided what business you are in, you are ready to consider another important part of you business plan. Marketing. Successful marketing starts with the owner-manager. You have to know the merchandise you sell and the wishes and wants of your customers you can appeal to. The objective is to move the stock off the shelves and display racks at the right price and bring in sales dollars.
The text and suggested working papers that follow are designed to help you work out a marketing plan for your store.
Determining the Sales Potential
In retail business, your sales potential depends on location. Like a tree, a store has to draw its nourishment from the area around it. The following questions should help you work through the problem of selecting a profitable location.
In what part of the city or town will you locate?
In the downtown business section?
In the area right next to the downtown business area?
In a residential section of the town?
On the highway outside of town?
In the suburbs?
In a suburban shopping center?
On a worksheet, write where you plan to locate and give your reasons why you chose that particular location.
Now consider these questions that will help you narrow down a place in your location area.
What is the competition in the area you have picked?
How many of the stores look prosperous?
How many look as though they are barely getting by?
How many similar stores went out of business in this area last year?
How many new stores opened up in the last year?
What price line does competition carry?
Which store or stores in the area will be your biggest competitors?
Again, write down the reasons for your opinions. Also write out an analysis of the areas economic base and give the reason for your opinion. Is the area in which you plan to locate supported by a strong economic base? For example, are nearby industries working full time? Only part time? Did any industries go out of business in the past several months? Are new industries scheduled to open in the next several months?
When you find a store building that seems to be what you need, answer the following questions:
Is the neighborhood starting to get run down?
Is the neighborhood new and on the way up? (The local Chamber of Commerce may have census data for your area. Census Tracts on Population, published by the Bureau of Census, may be useful. Other sources on such marketing statistics are trade associations and directories).
Are there any super highways or throughways planned for the neighborhood?
Is street traffic fairly heavy all day?
How close is the building to bus lines and other transportation?
Are there adequate parking spaces convenient to your store?
Are the sidewalks in good repair (you may have to repair them)?
is the street lighting good?
Is your store on the sunny side of the street?
What is the occupancy history of this store building? Does the store have a reputation for failures? (Have stores opened and closed after a short time)?
Why have other businesses failed in this location?
What is the physical condition of the store?
What service does the landlord provide?
What are the terms of the lease?
How much rent must you pay each month?
Estimate the gross annual sales you expect in this location.
When you think you have finally solved the site location question, ask your banker to recommend people who know most about location in your line of business. Contact these people and listen to their advice and opinions, weigh what they say, then decide.
Attracting