This Episode: Your Store Is Not A Museum
Let’s be real, old merchandise just sitting on your shelves isn’t doing you any favors. It’s not an artifact to be admired; it’s taking up space, tying up cash, and making your store look stale. And no amount of fluffing, shifting, or rearranging is going to magically make it fresh again.
The good news? There are plenty of smart ways to clear it out! A good ol’ clearance sale is a classic, but have you tried mystery bags? Sidewalk sales? Bundling slow movers with hot sellers? The key is to turn that dead weight into dollars!
Next week we’re hosting a Facebook live event with Melodie van der Baan, Co-Founder and CEO of Max Retail to discuss this very topic! RSVP by clicking the button below.
Rather Read The Episode? Click Here.
Hey. It’s Bob Negen. And in this episode of Real Retail TV, we’re going to explore the idea that your store is not a museum.
One of the biggest mistakes I see independent retailers make, and I know it’s a mistake that I made for a long, long, long time, is carrying too much inventory.
There’s this tendency to hang on to margin. You don’t wanna mark things down because you’re going to erode your margins.
But recognize that there is a carrying cost to carrying too much inventory.
Recognize that when you have too much tied up into old inventory, you don’t have cash to invest in new fresh inventory.
I call this the death cycle.
And how do I know about the death cycle and how did I create this term? It be it’s because I lived it. So here’s what happens in the death cycle.
You can’t you’re carrying too much inventory. You go to a show. You buy a little of this, a little of that, too much of this, too much of that. My brother Steve and I used to walk around the New York Toy Fair and Astra and the Kite Trade Association, and we would look for things that were gonna be hot. And if we bought something that was if we saw something we thought was gonna be hot, we would buy a boatload of them. But we didn’t call it a boatload.
And guess what would happen? What would happen is inevitably, our what we thought would be hot item or line inevitably be not inevitably, but often didn’t perform as we had hoped.
And so what ends up happening in that case, we didn’t wanna mark it down. We didn’t want to lose money, and therefore, we held on to it. And then that slowly having too much inventory and not enough cash slowly diminished our ability to buy fresh.
Our credit started to become used up. Our credit cards became maxed out. And what we found was there are only so many times you can remerchandise your store to make it look fresh.
And why I call it a death cycle is because pretty soon you don’t have cash to bring in fresh. Pretty soon your store becomes stale. Pretty soon, your customers quit coming into your store because they’re looking at the same thing again and again and again, and no amount of enthusiasm will make up for the lack of fresh inventory.
And so this idea then I learned this from, I don’t remember who. Oh, Stanton Hobby Shop. That that term, your store is not a museum. So if you’re sitting on too much inventory, recognize your store is not a museum.
Get rid of it. Even if you have to sell it below cost, of course, there are strategic markdowns. Of course, there are intelligent clearance strategies.
Of course, you want to nip the problem in the, you know, at the bud by being a wise inventory manager, by developing the skill of inventory management. But at the end of the day, right now, if you are sitting on too much inventory, recognize the need to the intelligence of and the importance of getting rid of all of your dogs, your slow movers.
You wanna get rid of your dogs, bring in fresh, watch your business prosper.
Remember, your store is not a museum.
