Category Archives: Retail Sales

Retail sales tips for small business success.

Running a Consignment Business

This is a discussion regarding consignment businesses–types of consignment businesses, advantages, disadvantages, and opportunities.

There is a good chance that you have patronized at least one consignment business in your life. Consignment businesses are stores that sell items that they have not yet paid for. The store owners contract with suppliers (usually small business people in the area) to display products in the store for sale to the public. The supplier is only paid if and when the store sells an item to a customer.

Advantages of a Consignment Arrangement

The advantages of consignment arrangements are mostly one sided in favor of the consignment shop. Consignment businesses can display and sell items without ever having to make an upfront investment related to stock; they only pay rent and overhead. Consignment business owners are basically go-betweens, connecting artists and small manufacturers with the public. The most popular consignment shops you will find usually sell artwork, clothing, and other small trinkets.

The plus for consignment shop suppliers is that they finally have a venue to distribute their products. This is an ideal situation for business people who do not have a storefront, such as a furniture maker who manufactures products from home or an individual looking to unload used items of value.

Challenges and Payment Concerns

The process of setting up a consignment arrangement seems pretty basic, but there are some downsides and challenges. The biggest issue that consignment businesses have to manage is how to pay their suppliers once the products are sold.

The shop and supplier will agree upon a fair split, usually about 60/40 in favor of the supplier/artist. A meticulous consignment shop owner will call a supplier immediately after an item is sold to tell him to come pick up his check. This makes for better accounting and is a common practice for consignment businesses who work with more expensive items, such as artwork.

On the other hand, many consignment shop owners are not as consistent with their bookkeeping and won’t call their suppliers regarding payment. Instead, the supplier will have to call constantly to check on her products. This process can create potential problems for both sides.

For one, there is an increased possibility that there will be discrepancies and disagreements between the shop owner and the supplier as time goes along. Suppliers can become increasingly mistrustful of the shop owner when they go months and even years without receiving proper payment. It is also sometimes difficult to end a consignment arrangement.

For a consignment business, the customers are number one, but the suppliers are a very close second, so the best practice when operating a consignment shop is to maintain very regular communications with suppliers and pay them promptly.

Online Consignment Businesses



With the growth of the wildly popular web auction site Ebay, there has been an explosion in online consignment businesses, sometimes called drop off stores. Many brick and mortar consignment shops are set up with the sole intention of selling the products people bring in on Ebay and other online sites. The overhead costs are minimal and online consignment shop owners can sell the consigned items from the comfort of their home offices.

Are Consignment Businesses Viable?

It seems that nowadays, due to increasing costs across the board, setting up a consignment business is only practical when the sales are being made online. More and more customers are choosing to forgo the physical shopping experience and buy their items online to find the best deals possible. In addition, rents in popular shopping districts are sometimes prohibitive for new business owners.

If you are thinking about starting your own consignment business and want to learn more about the advantages and challenges, the best thing you can do is gather as much information as possible from existing business owners.

Ask your local shop owners about their business model and browse online forums to read what other online and brick and mortar consignment business owners are experiencing. Setting up a consignment shop may seem easy, but just as with any other business idea, you need to be 100% positive that you’re fit for the task.





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How to Buy Direct from Manufacturers: For Small Retailers

So you wanna buy direct from manufacturers to start a small retail or distribution operation? This quick article will help guide you in the right direction.

In many cases, a manufacturer prefers to distribute its products to an established retailer or distribution company rather than dealing with an unknown individual. Even if an individual who claims to be a business contacts the manufacturing company he may need to provide proof of his business status. Additionally, the manufacturer may request a bulk purchase. So if you want to buy items directly from a manufacturer on an ongoing basis in the course of business as a small retailer or distributor you’ll need to get a reseller’s permit from your state.

1. Contact your State Franchise Tax Board division or finance department to request an application for a reseller’s or seller’s permit. This is a permit that establishes your company as an official business that plans to resell goods to end users. You’ll likely have to pay a fee for this permit and provide detailed information about your intended business activities. You may also need to register your business with the state before receiving the reseller’s permit.

2. Wait to receive your reseller’s permit in the mail.

3. Call the manufacturer that you want to do business when you have your reseller’s permit and explain your desire to establish a vending relationship. Provide details about your company, including the locations where you plan to sell the items (such as online or in your physical store). The manufacturer will consider establishing a business relationship with you based on your business plan, reputation and company credit report (if available).

4. Fill out a credit application as required by the manufacturer if you want to receive the goods on credit. Negotiate a discount rate and invoicing terms. Fax, mail or email a copy of your reseller’s permit to the manufacturing company to wait for final approval for your distributor account. You may have to sign a distribution agreement with the manufacturer that lists terms.

5. Request a catalog of current available products that you wish to sell to your customers. Submit a purchase order (see here for an example) to the manufacturer listing the items you wish to buy and your delivery address.



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Social Media Marketing Tips for a New Clothing Store

When you open a new retail clothing store, whether it’s online or at a physical location, one of your top marketing goals should be to connect with the right people who can help spread the word and increase your market reach. Social media makes that process easier for store owners. With social media marketing you can become a premier store that fashionistas and clothing enthusiasts go to for the latest trends.

fashionableladyBe a Trend Setter
People commonly use social media sites to stay updated about the latest fashions and clothing trends. Give them what they want—use Twitter and Facebook to share pictures of the latest trends that come across your radar as well as fashion “do’s and don’ts.” Put clothing pieces together to show your followers how to complete the perfect look. Start a conversation on Facebook to encourage people to share their own fashion ideas or faux pas. Pinterest is also a perfect place to display your outfit ideas and gain more followers for your store.

Generate a Buzz
Create energy and buzz about the items that will be shipping into your store soon so that people will be eager to snatch them up. One way to do this is to offer them in very limited quantities. For instance, if you post a picture of an amazing pair of pants on Twitter and state that there are only 10 available starting Monday morning, it can create an intense demand for the item. If you do this consistently and successfully, you might get to the point where people are willing to stand in line at your store to get the latest items. If you have an online clothing store, start a countdown clock until the limited quantity item is available to the public and remember to inform everyone when it’s sold out.

Value Your Followers

You are nothing without your customers, so make sure that they know just how much you appreciate them. Back up your glowing words of praise with special offers and discounts to keep your best customers coming back for more. Also, on social media sites it’s important that you interact with your followers and show them that you’re not just a bot posting advertisements. Talk to random followers and answer people who ask you questions about your merchandise.

Creating a reputation for being an awesome new clothing store won’t happen overnight, but with smart social media marketing you can accomplish this goal more quickly. Offer the latest trends, create a buzz, open up to your customers on social media sites and be sure to thank your customers with special offers that keep them coming back for more.

 

 

Image credit: © Phil Date | Dreamstime Stock Photos

 



Starting up a small business, even if it's just on the side, is no longer an option -- it's a necessity. Why? Because everyone needs an additional source of income in our new economy. Click here to sign up for educational and motivational posts to keep you on track.

Face-to-Face Sales Tips (Trade Shows, Retail Stores & Festivals)

Selling online or over the phone requires a lot less pressure compared to selling in face-to-face scenarios. Online you simply present your pitch in written words and wait for someone who needs that solution to grab a hold of your message and make a purchase. When selling over the phone, you don’t have to be self-conscious about your appearance or gestures. But in a face-to-face selling situation, you have the potential buyer right there, in your face, waiting to see if you have something that they need or want.

Come Armed with Visuals

When you put yourself in any face-to-face selling opportunity, always come armed with some type of printed or visual media. The media should either attract the attention of potential buyers or educate them on features. It assists your pitch. For instance, if you are selling an invention at a trade show, make sure that you have a video playing that demonstrates how it works, or an educational leaflet to give to passersby. Either one attracts the attention of potential buyers and puts you in a better position to convert the face-to-face sale.

Let Them Touch It

If you sell a physical product, put it in the potential buyer’s hand. When a customer holds an item in his hands, the chance of a sale increases. The potential customer takes “ownership” of the item when she holds it in her hands, feels it and plays around with it. Some people will find it hard to let the item go. So as soon as someone comes up to your table or booth, pick up one of your products and offer it to them—then start talking to them about it.

Ask Questions

Some sales people make one common mistake when selling in face-to-face scenarios—they talk too much. They are so eager to sell the product or nervous that they talk themselves right of the sale. Let the customer talk to you—ask her questions related to her needs or desires. Listen intently and show her that you care about her needs and issues. Then present your product as a potential solution.

When selling in a face-to-face situation it is important to be aware of yourself, but you must also be aware of the potential customer’s needs, desires and behaviors. Relax, be prepared, put the customer first and watch as the rest of the pieces fall into place.