Indie Retailer Response to Unsettling Times: The Best Defense is a Good Offense
To confront threats effectively, one must be proactive and take action—a principle of playing offense. This philosophy, the core of M1 planning, emphasizes continuous building and growth, as inaction leads to decline. Business advancement inherently involves calculated risks, requiring asking pertinent questions to understand these risks and leveraging data to assess decisions.
Consider the analogy of a buffalo facing a storm: charging directly minimizes exposure compared to lingering at the edges. Similarly, when confronted with issues like tariffs, businesses should proactively plan and ask strategic questions rather than passively reacting and assigning blame.
To play offense, step away from daily minutiae and constant news consumption to critically evaluate your business. Challenge your current strategies by asking questions in the following categories:
Growth & Classification:
How can the business revenue increase by $250,000, $500,000, or even $1 million?
Which classifications and categories possess the greatest growth potential?
Are efforts balanced across classifications for sustained growth, or is the focus solely on chasing fleeting "hot items"?
Customer Service:
Instead of claiming great customer service, define it concretely and identify areas for improvement.
What specific actions embody taking customer service "up a notch," incorporating more enthusiasm, effort, intensity, and focus?
Assortment Strategy:
Conduct a thorough review of current product assortments to identify redundancies and underperforming "fringe" items.
Does the current assortment align with a clear merchandising strategy (wide and thin, narrow and deep, scrambled, localized, or a combination)?
Which merchandising strategy will yield the most significant business growth?
Pricing Strategy:
What is the current pricing strategy (tiered, high/low, luxury, budget)?
What is your margin strategy?
Sell-Through & Inventory Management:
Is there a defined sell-through plan with corresponding actions based on performance?
For multi-store retailers, what is the approach to handling inventory transfers: replenishing with new items or shifting existing stock? Evaluate the efficiency of analyzing, packing, and transporting goods between stores.
Is the fulfillment strategy based on direct vendor drop shipping or utilizing a warehouse? Weigh the advantages and disadvantages of each model.
These questions offer a more constructive approach to navigating business threats than dwelling on the threats themselves. In unsettling times, it's crucial to recognize that the only controllable aspect of a business is the owner's mindset, actions, and responses.Embrace a proactive stance when facing business challenges. Facing business challenges, retailers should proactively pursue growth-oriented strategies rather than passively reacting to circumstances. An offensive approach focused on forward momentum is key.
If you would like a deeper dive into your business contact me at marc@mangement-one.com
Onwards and Upwards,
Marc Weiss
CoFounder Management One