Posted on Tue, Jun 22, 2010
I just got an interesting job that I think could become a great business tool for you. This is so good a business model that I might even want to pursue it even further and use it for more than this one client. But the best part is that anyone can do it and reap the rewards from this model.
I will be working for a distributor that has two major trade shows a year. All of the vendors he represents attend these buying shows. They offer 2 educational programs before the show begins and I will be doing one presentation for their sales reps and another one for their retailers.
In addition to the presentations, the distributor asked me to do a rather interesting assignment that could become a major trend. What I will be doing is going from trade show booth to trade show booth, with a video camera and a microphone and asking the vendors sales/managers or sales reps a few simple but powerful questions:
- What is HOT from your company?
- Why is it HOT?
- Why should the consumer buy it?
- What’s new?
- What are the advantages of doing business with your company?
When I edit the responses I will break the videos down to a 3 to 5 minute maximum. They will be converted into YouTube and placed in a private section of YouTube. Then the distributor will offer this library of videos for the retailers to use on their websites. FREE Content. And the distributor will charge the vendor an advertising fee.
What makes this important for you to do?
One of the reasons that online sales have been strong is because of the amount of educational data, product reviews, customer feedback, and owner’s polls. When you think about it, an online merchant is able to beat the retailer at their own strength which has traditionally been customer service, expertise, and dependability of the specialty retailer to know and stand behind the product.
Things have changed and the difference is in the area of expertise and sharing that expertise. Having a website filled with instructional and informative short video makes your website one that people will return to again and again. Even if someone doesn’t buy from you, people will be talking about you and in time that will pay big dividends.
SO WHAT IS THE ACTION STEP?
First, ask every vendor you do business with if they have created short instructional, fun, or informational videos that you can use on your website. If not, start to bring a camera to trade shows, any point and shoot camera works since they all take movies today. Then, ask the questions I listed earlier. OR When a sales rep is in your store, take a video. OR you can use SKYPE (it’s free or has a tiny charge) to capture a video recording right through your computer.
I have found someone to edit my videos. Trust me, there are plenty of people who do that work as a part time job. Then just have them up load it to YouTube (it’s really pretty simple- I even did 2 of them a month ago myself). Once they are on YouTube, you can easily add them to your website and Facebook site. You can even use these videos in your store if you have a flat screen monitor. You can use some of the smaller screens that are not very expensive.
This is really a winner and it just enhances the shopping experience within your store. It also makes your website far more interesting and encourages your visitors to return again and again.
Posted on Tue, Oct 02, 2007
This is the result of last week’s survey question about the store that was trying to decide what to do about her business. If you didn’t read the article you can read it at www.ricksegel.com/blog. Here are the results and I want you to know that my response was not the most popular. So I guess I am going to have to justify why I suggested what I proposed.
But first the results:
a. Close now and face the consequences
received 3%
b. Wait till next summer and close then
(my suggestion) 39%
c. Don’t give up at all and wait till
the end of July to make any decision
like that 46%
d. Try to sell the business, get what
she can get, and even take a small
loss if she has to 12%
Here are some of your comments:
“There is another option which is a combination of the choices. Try to sell it now but prepare to close it if you have to.”
“It’s not that the person is in debt that concerns me, as much as her attitude toward debt.”
“So she bought too much inventory. What retailer hasn’t?”
“Ok its timer to cut expenses and look for every way possible to generate revenues.”
“Why not try to take on a partner and also check out the Small Business Administration for some help.” (Some great ideas.)
“I need more information before I could make such a decision. But based on what you have given me I would have to choose C.”
“Why couldn’t she make some money from the local people. Maybe they will come out for a sale like this.”
“It’s time to have the owner fall in love with her store again. If she turns this around she will feel so good about what she has accomplished.”
“What about if she leases out a portion of the building to another store to reduce her expenses and expectations.”
“Re-merchandise the store and buy more accessories to brighten up the store and make it look fresh and exciting again.”
“Rick, I am surprised you didn’t offer an online solution. Such as E-Bay or setting up a store front online. She could donate things to a charity for the tax benefits.”
“Have a sale and everyone that buys at least $50 worth of merchandise gets a gift. I gave a box of candy. No one left without spending at least $50.”
Here is the most unique comment that we can all learn from.
“Take a vacation, forget about the store for a while. When you come back you will be refreshed with a new perspective.”
Here is my defense:
Please understand that I am first looking at this from a financial point of view. I don’t want this store owner burdened with debt for the rest of her life. I have seen many retailers close their doors selling one type of merchandise, then reopen selling something else very successfully. They simply reinvent themselves. Sometimes just a change of locations can invigorate a business.
I was very friendly with a couple who had a business similar to mine, a specialty moderate to better women’s fashion boutique. They altered just about everything they sold. They closed their doors and opened a sportswear store and did very well with half of the expenses.
Where this store is a seasonal store with only 8 to 10 weeks of really strong business potential, the decision to close should be made prior to the summer. Most Going Out of Business Sales last 8 1/2 weeks. The reason I rejected the wait till July option is because you want to plan this type of event long in advance and bring in the type of merchandise that a store can make money on during a sale like this.
The highest margins I ever worked on were during my closing sale. As for selling the business, you can get lucky but from my experience prospective buyers generally offer between 40 to 50% on the wholesale dollar. Then by the time you include fixtures and goodwill, you are selling your business for the cost of your inventory. Most retailers can run a sale that is far more profitable than that.
Let’s address the emotional side of closing a business. It’s tough even if the business is debt free. Sometimes it’s a hard medicine to prescribe but rarely do I ever hear of any regrets. Just keep moving on…
