It's a good question, what exactly in your shop, is stopping you from selling more. The more information you have the better you will be able to find out why.
One method used is traffic counting. Now if you think about it, the only real information, you get other, then gut feel is what your pos software tells you, and that information is purely what happened at the end of the sales process.
This is a result of several different factors.
1) How many people walked past your shop?
2) How many came into your shop?
3) How many purchased?
There is a lot that happens from step (1) to (3) and the only way you are going to know these figures is using a traffic counting software like ours. The rewards of doing these calculations are not huge as overall it is said to increase turnover by a few percent, still say for every turnover of a $1 million, with margins of 30%, by doing it you will be making about $6,000. Which is more than enough to pay for the system plus give you far more control over your business.
Let’s firstly, start off with the theory what we see if we start at the beginning of the sale process and of course every shop and every location is different but say following the steps above.
(1) Out of 100 people that walked past your shop.
(2) 5 visited your shop, and 95 walked past (95%).
(3) 1 purchased something, and 4 walked out buying nothing. (80%). We call this the sales conversion rate and one of the most important measurements retailers need to know is what is the best staff ratio to visitors.
This would be a very good set of figures.
Now the first point with traffic counting, the most important figure is the visitor ratio. Say, for example, with the above analysis instead of 5% coming into the shop, 6% came into the shop. Now keeping everything the same,
(1) Out of 100 people that walked past your shop.
(2) 6 visited your shop, and 94 walked past.
(3) 1.2 purchased something, and 4.8 walked out buying nothing.
A one-percent increase in visit rates has produced 20% more sales.
However, there is much more.
Say the shopping centre suddenly saw a massive increase in people coming. Something like this did happen this Christmas with many of the centres reporting over 30% increase in traffic.
(1) Now say you measured 130 people, 30% more.
(2) 5 came into your shop.
What you would know is that something you did very wrong as what these extra people wanted you were not supplying. Maybe you are a destination shop like a chemist, and people are only coming for their prescriptions. Interestingly though even then chemist are some of the biggest users of traffic analysis we have.
Now say on the other hand.
(1) Now say you measured 130 people, 30% more.
(2) 10 came into your shop.
Something went well here. What?
Now say you had.
(2) 50 come into the shop.
(3) 5 purchased something.
You would know something was wrong because your conversion rate is so low. Maybe you did not have enough staff that day, and your staff could not handle the extra traffic. That is why traffic analysis is very useful for in roistering.
Our traffic counting system over time will give you simple and actionable insights and providing you with real information for your decision making.
