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The economic turmoil that has gripped the nation continues to deepen and independent shop owners are understandably worried about the future. A growing number of small companies are going bankrupt as consumers tighten their belts and close their wallets. Indeed Mathieu Perreault Youth Jersey , sales numbers have plummeted in all sectors of retailing, from textiles to consumer electronics to the food and hospitality industries.

It is imperative that small retailers revisit their plans for the coming months and years. In this article, I'll provide a basic framework that you can use to survive and thrive in a turbulent economy.

Planning Sales With A Shorter Outlook

As an independent retailer, it is very likely that you have seen a decline in sales since the beginning of the year. Chances are, current sales levels are not going to change for several months Kyle Connor Youth Jersey , if not years. Now is the time to revisit your forecasts and modify your sales plan with a shorter outlook. Avoid pooling your cash in inventories for which you hope sales will increase. Instead, stock what you need sixty to ninety days out; adapt to what your customers want to buy today.

Managing Staff And Payroll Costs

Keeping employees on the payroll can be an emotional issue for small shop owners. Not only are good employees hard to find, but they often become like family. However, keep in mind that when sales activity drops, payroll costs increase as a proportion of revenue. At some point Mark Scheifele Youth Jersey , cutting those costs will become necessary. The key is to find a way to reduce your payroll expense without losing your best workers or inconveniencing your customer base.

Tightening The Focus Of Your Promotional Efforts

Every specialty retailer should have a list of their best customers. These are the people who have displayed their loyalty with continued patronage. They buy repeatedly. They tell their friends about your store. They are responsive to your marketing programs. As the economy continues to struggle, these are the customers on whom to focus your promotions and advertising campaigns. For example, organize special events such as exclusive presentations to which they're invited to see new products.

Buttressing Your Profit Margins

In a healthy economy, you can expect wide margins. However, today's retailing climate is different. Those margins are being decimated as local merchants are forced to absorb markdowns in order to turn their inventories. Contact your vendors. Try to negotiate lower wholesale prices so you can buttress your slipping margins. It does little good for vendors to enforce high prices if doing so means losing your long-term business.

Watching Your Inventory And Assortments

Small retailers should always keep a wary eye on their inventory levels Josh Morrissey Youth Jersey , even during a robust economy. It has never been more important to do so. Most independent shop owners cannot afford to invest a large portion of their cash flow into inventories that won't sell. Just as consumers are tightening their belts, so too, should local merchants tighten their selection of assortments.

Fringe items that are not contributing to the bottom line should be cut. Excess merchandise should be dropped. Keep your inventory lean and respond to your customers' immediate needs and buying activity.

Cash Flow Is King

The small retailer who maintains a generous cash flow has a significant advantage during a rough economic climate. Cash flow provides independent shop owners the necessary flexibility to respond quickly in a dynamic retailing environment. Plan your rolling cash flow several months out and keep a close eye on variances and shortfalls.

A turbulent economy can wreak havoc in all retailing sectors. However, by revisiting your sales plan, keeping costs low and inventories lean Connor Hellebuyck Youth Jersey , and maintaining a healthy cash flow, you can survive and thrive in this challenging environment.
Which Arthritis Treatment for Dogs Works Best? Family Articles | October 20, 2011
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