No one works harder. No one is as dedicated. No one else gives up weekends, holidays, family functions and almost all pleasures in life to be at the store. You deserve to be paid.
Sadly, if you’re like so many independent retailers, you’ve continually put money into the business rather than taking money out. Yes, it’s your baby, but after a while, it should support itself. Actually, if you start right, you will never have to put more money into the business. Running properly, it should generate enough income to pay the vendors, pay the overhead and YOU!
How can you turn your time honored practice of working for free (or paying to work) around and begin taking money home? Well, the money for your new car, your vacation, your child’s tuition and any of your other dreams is sitting in the store depreciating. Yes, I’m talking about your inventory – your excess inventory.
Your problem (and you’re not alone) is your buying. Sure you know your customers and you know your store and you pick great items. But you don’t know when to stop buying and too much of a good thing is a bad thing. Yes, the reps are all your BFFs and you would never want to send them home without an order, but sometimes you must. It’s better for you to pay for lunch than let them.
So, your problem is your buying and your profits are tied up in depreciating inventory – how do you solve this problem? The first thing you need to do is put together an open to buy plan. A good open to buy plan will tell you how much inventory you should have each month for the next 12 months based on your anticipated sales and desired turn rates. Turnover is the way you make money in retailing and must be an integral part of your open to buy plan. With sales, turnover, and ideal inventory levels in each department, your open to buy will tell you where your present inventory and future orders are out of balance.
Get to work correcting those situations and it won’t be long before you can start taking home a paycheck yourself!