I attended an online lecture for retailers on what stock items a shop should select for sale. Some of the points I thought were pretty good, so I took down some notes. Here are a few

- Seasonal items are trouble. If you handle them, what you are buying is products for a short time. For similar reasons, avoid fad items. The fad goes, and you are stuck with the goods.

It is better to take products that give you a whole year of sales. 

- Delivery is one of the most significant problems in retail in Australia. Our delivery system is expensive and not particularly good. 

Avoid large and heavy items as they have high transport costs that will eat into your margin. 

Fragile goods are trouble.

- You need to know your price points that people are comfortable in trading with you.

- You want products that people like, so check the online reviews first. Any problems will reflect badly on you too. You want products with good reviews.

As a rule here, electronic items are trouble. Returns and queries are much larger with these products than most other lines. 

- It is better to get a branded product with a large existing market than get an exclusive deal with an unknown product. In other words, it's best to be a small fish in a big pond in retail, then a large fish in a puddle. 

But check first if the brand gives you a fair chance to break into their product. If others are selling at prices like what they are offering you, what is the point of handling the item? 

- Before buying items over $50, people want to see them first. This is a significant problem for many online stores but a big plus for shops.

- At any one time in the shop you need new products to experiment with, as a rule, you always need 15 new products in the shop. 

Let me know if these tips are helpful. 

We are still going through the effects of the recent storms on the east coast of Australia that happened recently. Quite a few systems not protected by Uninterruptible power supply(UPS) were severely affected. Interestingly no one with a UPS got any damage. If you do not have one, please consider getting a UPS.

However, one point that caused some shock to us is that some commercial insurance policies do not protect the damaged equipment here. What you need to check is what happens if you get such equipment failure due to risks beyond your control eg weather.   

Some points to consider: 

- Costs of equipment failure, including repairing and/or replacing items and cost relating to repairs, e.g. transport costs.

- Temporary equipment rental costs to ensure that your business can maintain normal operations 

- Other fees related to this loss

- Business interruption, if you cannot invoice, how can you pay bills. 

Please check this.

Shopify released a list of products that are trending up now, here.

Unfortunately, they did not release Australian figures. So I went through their list to see what google trends stated was in Australia interesting.

Going through them these three, I think, would be of interest to my clients.

You have to remember that Australia has plenty of time and often want to organise so:

Storage containers

Australia now needs more home storage products to tidy away your belongings. They often need to create a clutter-free home. What they want now is stylish storage.

Bookends

Books have been selling well. People are organising them into some old order. So bookends are in demand as they are a neat solution to tidying up their book collection without spending a lot of money.

Temporary tattoos

Many people want tattoos that last 1-2 weeks and then fade into your skin.

I hope this is of help.

When buying or selling a business, consider the ownership of the computers and/or software.

It is not so simple as the business is likely running the software under a license that grants them the right to use the software, however, they probably do not own it. So they will have conditions attached to their use. Find out what they are! We provide on request the details, a change of ownership form and account details to prospective buyers on request, provided that the old owner agrees. 

 There can be other issues too.

- The new owner may experience problems due to privacy laws, so the software supplier cannot often help the new owner if there are problems until it confirms the new ownership. If the changeover is done at the weekend, this can be a real problem. 

- Is the system under subscription? If so, what the new owner is buying is nothing but a legal obligation to pay. 

Retail is changing. As such, what people buy from you changed too. The problem here is that our memory is like a camera. What can be in it is what was not what is now. This can cause significant problems. Own here is an excellent report to show you the shift in your sales shop.

Go to Cash register > reports.

Then Sales -Register> Sales comparison for a given period.

Above in purple, I put in the last few months and notice that I am using a few years back in comparison.

Now also notice in green that I changed the comparison from percentage to currency. This is because what happens is small departments often show dramatic changes. So, for example, a department with $5 in sales then, now having $20 sales, has a big percentage increase. In reality, is not much of a change

Try it.

Put in your figures and see.

Mother's Day is approaching. I hope you have formulated a winning formula to make the most of this lucrative retail event. It is a good idea to make a special Mother's Day display. Here is what you can do to help you determine the items to put on this stand.

Go to Register reports.

Now pick "Top N Stock Sales for a Given Period."

In the form, put in the week before Mothers 13 May 2018 (I would not suggest last year). These are the items that worked for you then. Hopefully, you have them now.

Mother's Day is an excellent shopping day in retail. Although it is on a limited-time shopping with a short season, it can if properly done make a considerable impact.

Retail today strives to maintain profitability. It has too. This is why gross margins are quoted. It is generally easy to calculate, often in theory, you do not have to as your suppliers will give them to you on request.

Actual gross margins, what you are getting is something else and challenging to get. Yet it is the heartbeat of your shop. It is the most important indicator to measure your business. It will help you see whether you are operating effectively.

It is, in my view, the best ways to determine whether your business position.

Now suppliers are often the first problem here as they often try to hide their figures. A common way to do this is not to give you margin but a markup figure. For example, a 30% margin is a 42% markup. Yet a 42% markup can sound better. Another way they often do this is to supply you with the margins for selected products only. Then they claim the others are of little relevance as they are minor. Yet to you, they may not be minor. It is, for this reason, we recommend that you always use margins for every product. That way, at least you are getting a consistent figure.

There are other reasons why actual gross margins are wrong. For example, if you have a product, you discount for some reason.

The result is the same, as your margins can differ from what it looks like in your mind. This is why you need a fast and reliable method to measure this KPI.

Well is quick and easy to do.

To get this KPI, please go to cash register reports, then go to sales.

Once there select

Dissection Sales / Profitability for a Given Period.

Now run the report for the last year. See is a column there which is % Profit, it will tell you the actual figure by dissection.

Now check them to see what you are getting.

Try it now, it will take you a second to do.

This is a scannable QR code advertisement created by drones above the night sky in Shanghai a few days ago. It looks brilliant but makes me wonder if in the future will our heavens will be filled with QR codes. Have you seen the movie Bladerunner 2049? 

Already in your shop you can see QR codes are being used by suppliers of goods, but their use is rapidly spreading. For people with online stores, it is a must in the shop. That is why our latest version of our software has more support for QR codes. The possibilities of QR code in retail are many. One immediate advantage is that QR has better error correction. 

What has been happening is that some of our clients, while using QR codes, have problems scanning. The problem is with the scanners. Although we have not been able to pin it down, the main problem appears to be is glare. A fix that seems to work is to move the object. Failing that, change the scanner angle say reading vertically rather than horizontal. 

If this fixes it, try shielding your scanner from direct light. If this does not work, let me know.

Gift wrapping has been a popular service offered by retailers to differentiate their products from other retailers.  

Since few have the skill, the public prefers to have people that know how to wrap their purchases. 

In my experience, gift wrapping is popular all year long. It is not a Christmas thing, as many people mistakenly believe. We all have regular family birthdays, anniversaries, dinner invites etc. 

Learning to do it is not hard. It only takes a bit of practice to develop.  In most shops, it does not take long to get the training. 

This you can offer at little cost. Start small and scale up if it gets up. 

I am sure you will see an improvement in your customer satisfaction and so get more sales.

One point you may want to consider is offering a *FREE* service and a *DELUXE* with a cost. Deluxe includes a card where their order, e.g. toy, will be beautifully gift wrapped in gorgeous wrapping paper. The odds are good that many of your customers will choose the Deluxe.

Come holidays; you can offer an appropriate wrap for that day.

Here is a step-by-step video above with a quick method if you want to learn how to it. It does not take long to master it; as a kid in my Mum and grandfathers shop, I could do it as fast as people handed me the item. If you want to see how quick it can be done with this method, check this video out.

Balance Your Cash Register Drawer Like an Expert

If you are not now using X-Offs, I would suggest taking a look at this function. You will find the process at the end of day function.  See the purple arrow above.

If you want to play around with it, do not worry, as it is entirely safe for you to run "X" reports whenever you want to.

What X-Offs will provide you with details of what is in your cash register right now! It is a snapshot of your sales totals, till activities and cash balance now. You can run it as many times as you like.

Say you want to check something. For example, discrepancies in the cash register, check your sales in the middle of a day or verify EFTPOS transactions. Well, you can use X-Offs.

If you see the Options where the green arrow points, you can check lots of detail.

Why not test it out in the training system, put a few transactions into it, do an X-Offs and see what it shows? Then repeat the process with a few more transactions and so on.

This is another example of how our system offers you functions you can use.

According to reports, I get the Australian toy market is now doing well. 

Yet, when I asked a few of my clients about this, I got confusing messages. Part of the reason is that here, I think, is that it's a big market. What you need to do is carefully find your ideal target markets in the toy industry. Then narrow your focus on those segments.  You cannot be all things to all people.

Looking through the reports, here is one segment you should look at if you are in toys, toys for pets.  

You have the technology as your Point of Sale system now is probably the best in this market.

This market is growing at about 7% a year, and it is growing both in units sold and unit price. 

Here are some demographics to help you to determine whether your customers are buying these products. 

-Unlike most toys markets, it is men that spend more than women on pets
-Homeowners spend more.
-Married couples spend more.
-People who live in the suburbs spend more.

If you think you tick these boxes, have a chew on entering this market.

A first-level approximation of determining your shrinkage

You would be getting a theoretical margin in a perfect world. In the real world, goods get stolen, lost, damaged, mispriced, discounted, etc.

Checking your theoretical margin

It is often easy to get as your supplier will usually provide you with this figure. The first point to do is check this 

Go to register resports> Stock > "Quantity On Hand and Price Check."

The report will show you your margins. 

Actual results.

Here is how we get the actual result.

(Stock sold) = (Sales) x (1-theoretical margin%/100). 

Now for each department, 
(Perpetual stock) =(opening stock)-(closing stock)+ (purchases)

This is a first-level approximation, so we assume that your stock ordering is good. Thus we make (opening stock)=(closing stock) and so use the following formula.

The (Perpetual stock) =(Purchases)

What you want to compare is the difference.

(Difference percentage) = (1-((Stock sold)/(Perpetual stock))x100%

As a rule, about .5% is a typical figure.

If it is much more than that, it is considered severe. 

Plugin the figures from your totals report and purchases for the last twelve months. Now for each department calculate the (Difference percentage)

It should take you less than 10 minutes to do once you get the hang of it.

This will quickly tell you if there is a problem and, if so, the extent and where the problem is now. 

Before you think it is of little help 1%, let me show you have much of even improvement per year this can make.

Going to the ATO benchmark study they give what I consider the best benchmarking figures for businesses in Australia today free.

Now I picked a hairdresser shop just because it is something most of us can get our head around. Then picked the average for everything. I put it into an excel spreadsheet and then made a new column for 1% improvement.

Bottom line: I got a 25% increase in profit. That is pretty impressive.

How do we do this 1% improvement?

Well, there is an excellent quote in management theory. I learnt that "what gets measured is what gets improved." What we need to do is measure over time. This will tell you where you are, and how you got there. Then how you go compared to others. Then see where you are going if nothing changes. 

And with our POS Software, you have the tool.

Look through our reports for ones that you like, here are some key metrics, I suggest you start with.  

Total Profit
Most would say this is the most critical metric in a shop today. It is the primary method used by people to determine their business value.

Number of Customers (Customer Traffic)
The number of customers in your shop is the most straightforward metric for your retail business. 

Average profit by the sale  
This is always an exciting measure in a shop. Are people that buy more or not?  

Basket size
This shows how productive you are in the shop.

Often these are linked. For example, if you see profit per sale is down by basket size is up. Well, you are pushing the wrong products, or maybe you are overdoing discounts. 

Try giving your business a standard to measure itself for continual improvement.

One resource that has exploded now as a result of this pandemic is online learning. There are many lectures and course on almost any subject currently available. Universities, various education institutes, companies, organisations, professors, private people, etc., now do talks, lectures and courses on any subject. We have too. Currently, we do almost all of our training online. Heaps of our clients' now book in for training sessions. Besides being the only way now, it is efficient. 

I am finding some of them helpful eg the Victorian Chamber of Commerce (VCCI) has been running some practical talks, which I have attended. Often it gives me an understanding of the issues. Plus an appreciation of what the authorities are looking at with these issues. I also did an SEO course run by a leading SEO company and an online course on SMB marketing which was excellent.   

Overall the importance of disseminating knowledge has been highlighted through COVID-19. 

Here are some tips which I use.

1) Unless you have some career *resume* reasons, do not worry about doing the course tests or diplomas. 

2) Check first if you can do it when you want. We are not students with the time to fit our lives into a course. We need something we can do, stop at any time and come back too when we have time—no point in signing up for something that is done on a schedule. The kids will scream about something, an important phone call will come through, or some goods will arrive and needs your immediate attention.

3) Try short talks because the odds are we will not have the time or interest to finish. Often what we want is one good idea and then time to digest it. 

4) Try varying the talks. A change is as good as a holiday.

5) I do like YouTubes, as I can listen when I want and stop when I want. I do not know how kids have the strength to keep going for hours of education. I need a break. Forty-five minutes is, for me, the maximum. Then I will often stop, then I have a break and only then come back to it.

6) The other point good about youtube is the comments. Read them as it lets you know what others think about the ideas presented.

For many of us stuck in this pandemic, this online learning has kept us sane.

One trick often used by bargain hunters is looking for items that were on sale years ago. Sometimes the old codes still work, and so they can pick up a bargain. Occasionally in bargain sites, someone will pop up noting such a deal. That is how I got a good price on some software. 

The same trick can occur in your shop. You may have items that were on sale long ago in your system. This is because someone has incorrectly not taken out the deal. So these old prices are still active despite the sale being over long ago. This is a big problem if you import from a supplier their prices directly. 

It was often not picked up as you had no stock, but this stock if it creeps back into your shop and you have an old sale price.  

You can use many reports to find these items, but we have a special report to combat this. It is specially designed to find such items. 

Go to register reports>Stock>Stock on Sale between a given period

Put in the relevant detail and see what you have.

I suggest that you do run it now. Rarely, it does not find anything.

Many business people wonder if opening their shop at some times is worth it. This is particularly true now, as shopping has changed. This is driving our hairdressing shop clients crazy but every business now affected.

The problem is that there are many variable costs with opening extra hours. Beside these utilities and salaries costs, there are also issues like quality of life. On top of that, there is often the law of diminishing returns. Many customers will come when they know you are open anyway. 

If you are using our point of sale system, we have reports that will help you make an informed decision. Using them, many of our clients have gained efficiencies by adjusting their trading hours by determining if the sales justify the increased costs?

Now there are many such reports in our POS software. This one, in particular, you should look at is sales traffic analysis. It will give you a visual picture based on days and times.

Note its colour coded to make it easier to see.

Now do not pick a short period to determine the report for this as sometimes sales can be deceiving. What can happens then is that one big customer may be skewing the sales information. Check the number of sales too.

This is not about working harder. It's more about working smarter. To do this, you need to sit down and look over your figures. Then make an assessment.

Our software can give you those figures.

Today is a holiday for something your business probably can't do without, your computer. 

CLEAN OUT YOUR COMPUTER DAY

It is a great reminder to give your computer some tender loving care (TLC) and clean up your computer.

A computer is a mechanical device, it will not last forever, yet some simple cleaning tips can help increase its life. 

What happens is that over time, dust and dirt will build up in the computer, keyboards, monitors, etc. 

Left unchecked, it can damage everything. 

It does not take much to clean a computer. I find regularly used cleaning products work fine. If you need a blower, a hairdryer with cold air works fine.

Note if you have seen the movie Zoolander and this is you as the computer mechanics, now stop reading and ask someone else to do the cleaning.

Now before doing anything 

** Please turn off and unplug everything before you start cleaning. **

This is a video that I do suggest the person cleaning your computer views first and remember there is a good reason why this holiday was set up on a Monday wasif something goes wrong on a weekday you can get professional help if something goes really wrong.

This is the time of year when I sit back and think about where we need to go.  

Here is a quick question, do you ever ask yourself what your business mission statement is?

Can you think of a concise description of your business, its goals, and its purpose? What is its reason for being? Try writing it down in a sentence.

Now review last year what did you do. 

-What you did right? 

-What mistakes did you make?

Now ask yourself where do you want to go? Now write it down. 

What hurts is that many people do this with me and then disregard it.

Now is not the time to keep a “business as usual” approach. COVID-19 has changed the retail scene. Do not count on your experience. You need to look at the data. 

See what items are driving you the most traffic and profits into your shop. Once you know your money-makers, you can move them to prominent places. The current retail theory states that you should put good products in a few places. This is because, in the age of COVID-19, the stress is on giving more space for your high-demand items versus showing many items.

First, let us find your *MONEY EARNERS*. It will only take a second.

Go to register reports and select the top stock report as marked with the red arrow here.

For this do this by all the shop sales. 

Put in the past 30 days, then select 40. This will give you your top 40. 

Then you will get a report with all the figures.

Now put these items in a noticeable place. The more places, the better.

This method works, try it! 

What is happening now is both EFTPOS/Credit card usage, and fraud rates are way up.  What fueling the increase in fraud rates is that more EFTPOS/Credit transactions are not done in the shop.

Of the EFTPOS/Credit fraud, by far the biggest category, 71% is friendly fraud.  

Friendly fraud started when a customer queries what looks like a legitimate item on their account.  If it proceeds, what generally happens is that the bank will cancel the transaction. They will then debit the merchant. These people tend to prioritise consumer rights over merchant rights. Still, they do not like it, and since the rate is going up, we participated in a meeting to see what could be done. 

The responsibility to prove friendly fraud is on the merchant.

Here are some points you can do to reduce the risk.

1) The new DTI system that we are rolling out can help a lot the merchant. If you have not yet, signed up, do it while it is free. If it costs you nothing and can help, why not use it?

Details here.

2) If they are in the shop, process all transactions under the camera. Video evidence is something courts do accept.

3) Check the order, if the transaction amount is higher than usual. 

4) Another often larger order comes from the same customer after delivery. A fraudster who gets away with it will often try again.

4) Save delivery documentation. Signed documentation is a big help. 

5) If in doubt, contact your EFTPOS/Credit provider.

Hope this is of help.