In today’s fast-paced business environment, it’s harder than ever for small business retailers to stay up on the latest trends and work to outpace eCommerce stores. With these constant-changing factors, it’s no surprise research shows that half of all retail businesses close in their first two years.
In this cutthroat environment, it can seem as if one mistake can cause a small business to close up shop. Luckily, we’re here to help. Everyone makes mistakes, and that’s okay. We just want to ensure that none of your mistakes affect your small business. Whether you’re experiencing problems in your business or not, here are the 10 most common retail problems and how you can solve them as an entrepreneur.
Problem #1: Neglecting Store Operations
One of the biggest mistakes many retailers make is neglecting their store operations, which in-turn causes them to neglect their customers. The worst thing about this problem is that many entrepreneurs don’t even realize they do this.
Too many retailers have their minds in the wrong place, and instead of focusing on the success and growth of their business, they worry too much about personal accomplishments with the company. They start off with a strong work ethic, but when they see small successes, their motivation lessens, and they begin to coast.
The best businesses strive for upward growth and don’t stop, even when they receive praise and admiration. So if you feel like you’re starting to coast as a business owner, it’s time to get back on track.
To improve store operations, entrepreneurs can work to take a more hands-on approach to their management. They should be present at the storefront and work to engage customers and employees. Retailers should strive to be aware of their business in all aspects and work on progressing, even if it seems as if they’ve hit their peak. When business owners are actively involved with business operations, they can create a positive culture for their employers and consumers.
Problem #2: Declining Quality Customer Service
The sad truth of the 21st Century is that if customers don’t have a positive experience at a storefront, they can just purchase the product they want online. This is why poor customer service is such a serious retail problem. It’s important that businesses make an effort to accommodate their customers’ needs because if customers don’t feel appreciated, they will stop visiting physical stores.
You can improve your company’s customer service by showing customers that you respect and value them. Be aware of their wants and needs and show them that you pay attention to detail. You can offer personalized services, unique offerings, or even just a smile and conversation. A little will go a long way. Just think about how you would want to be treated as a customer and what would positively stand out to you during your shopping experience.
Problem #3: Forgetting About the Data
Numbers can sometimes be confusing or unappealing, but to a business owner, you have to be aware of what numbers your business is driving and what they mean. You can’t just sit back and hope that you’re generating a positive cash flow. You must be hands-on and know where your money is coming from and where it goes.
It’s good to be passionate about your business and start a company because you care about it, but you also need to take the next step to help it succeed by being data driven. Many entrepreneurs make decisions only based off emotion, but you also need to take trends and statistics into account.
If you know about data but aren’t applying your knowledge, work to make your decisions more number driven. If you aren’t comfortable with numbers or finances, educate yourself by reading, taking a course, or asking someone for help.
When you gain knowledge and insight, work to make decisions based on a mix of logical and emotional reasoning. Don’t rely solely about how you feel about your business but use your passion to learn about the data you’ve collected and make strategic, smart decisions with both elements together.
Problem #4: Failing to Adapt
You’ve probably had to adapt a lot within the past few years as new technology and trends have emerged. But businesses have been adapting since the start of time, and positive change is a good thing so don’t push it away.
Being outdated can be the demise of a small business, so make sure to stay current with the latest trends. Small businesses are already a big trend, so you’re already partly there!
To continue adapting, ask yourself and the people around you questions, and take time to think about the answers. Ask “what if” and “why” more often and be open to input. If your company is very outdated, it might be time to reevaluate your business. It can also be beneficial to see what other small businesses are doing to adapt. For example, you might want to update your company’s website or create a social media presence. Whatever you decide to do, just be ready for what’s next!
Problem #5: Underestimating Commitment to the Store
Some small business owners forget that opening a retail store comes with many consuming tasks such as a nonstop cycle of buying, marketing, displaying, and selling products. This process can sometimes be very overwhelming and demanding for some entrepreneurs. It also means that business owners endure long days or nights, nonstop ordering, and bill paying. Even though this can be tiresome, the minute you put it on the back burner, your small business can start to fail.
Of course, you can hire more employees, but it’s not always that easy.
You need to make your storefront a priority, because if you’re not looking after it, no one will. Take the time to get organized and create a schedule for taking inventory, ordering stock, and selling products. It’s going to be a lot of work, so hire team members if you need extra hands on deck. But remember the importance of being committed to your store, and know that if you are committed, so will your employees and customers.
Problem #6: Trying to Do It Alone
With a lot of responsibilities as a small business owner, there does come a time when you need to delegate tasks and onboard more team members. Your business won’t be able to grow and develop if you spend all your time bogged down by stressful tasks and don’t leave any room in your schedule to brainstorm or reflect. The time will come when you finally need to take a step back and ask for help.
When you’re finally ready to ask for help, hire and train a carefully selected staff who want your business to succeed just as much as you do. Delegate responsibilities to your new team and have them help with selling, organizing, marketing, inventory, accounting, or any other tasks you need. While they are working, take time to focus on bettering your business and put your effort into doing what you love.
Problem #7: Having an Undeveloped Brand
Sometimes I’ll walk into a store that clearly has an undeveloped brand. Maybe they’re selling too many items and I’m not sure why there are so many random things, or it could be too niched, and I’ll be turned off that I don’t fit the store’s targeted audience.
It’s important that small businesses find a happy medium between these two poles. Don’t have too large of an inventory and overwhelm customers, but also don’t turn customers away by being too niched.
A good rule of thumb is that each item in your store should make sense and contribute to your store’s overall vibe.
To develop your store’s brand, you should first decide on your store’s look and feel. Think about what your store’s personality would be like: how does it talk, what does it wear, what music does it listen to? Ask yourself all those questions and more to establish your branding. Next, curate your merchandise to reflect that brand. Your products should tell a story about your company, and that story should be understood by your customers from the minute they walk in.
Problem #8: Being a Bad Employer
Being a business owner is a tremendous responsibility, but sometimes the recognition and power of owning a business can get to the head of many entrepreneurs. This can create a negative power dynamic and create tension among leaders and employees. The jobs of business owners are to help manage and train people to be better. Thus, everyone should be working collectively for the betterment of the company. If you’re experiencing problems with your team, it might be time for you to take a reality check and see if it’s time to improve your employer-employee relations.
You’ve done amazing things in your life and have reached great successes, but sometimes it comes time for you to humble yourself and reassess your leadership strategies. Don’t be the boss. Be a leader. If you don’t invest in people, then they won’t invest in you or your company. Similarly, if you have a negative work culture, you need to change it. It is your responsibility to set a great example, listen to, and be supportive of your employees. Set an example by being kind and caring about people, but also make sure to separate your work and home lives. Get off your phone and work hard, and your employees will follow suit. Ultimately, you are responsible for your company culture, so work hard to be a good leader and your team will follow.
Problem #9: Ignoring the Market
Many business owners can sometimes turn a blind eye to the market, which can ultimately damage their company and decrease their revenue. Business owners make this mistake by selling items they want to sell rather than selling items their consumers desire. However, it is important to keep updated with new and developing trends and be aware of which items sell and which don’t.
First off, you should take an inventory analysis. An inventory analysis is a way for you to determine which products are worth keeping and what needs to be removed from the shelf. This can help you figure out what items are most popular so you can know what items you need the most of. Sometimes it can be hard to put your feelings aside and remove an item you like, but ultimately you need to focus on the consumers’ demands because their purchases determine the revenue for your business.
Problem #10: Overlooking Business Basics
Time to go back to business 101. As a business owner, it is imperative that you know the business basics and how they apply to your company. It might be hard to believe that this is a common mistake, but trust me, it is. Many business owners try to take short cuts because they think they can, but short cuts don’t get the job done. Proper planning and strategizing are crucial for any successful business and they can’t be avoided.
It’s okay to take time to refresh your basic business skills, but don’t forget or try to bypass the necessities. You need to know how to write a business plan, prepare for hiccups along the way, and handle your money and investments.
Many small business owners make these mistakes, and that’s okay! We want you to learn from your mistakes and continue to grow your business to be the best it can be.