Question: The talking heads seem to feel that the economy will bounce back once a vaccine is discovered for Covid-19. As a small retail operation how should I position myself to take full advantage of the eventual return to a possible new normal
Answer: Your question is very timely. SCORE counselors, Steve Spiro and Doug Carleton have just recently produced the “Survival Guide for the Retailer in a Post-Covid 19 Economy.” The writers state that...
“Estimates vary as to how long a recovery will take for consumer spending to really begin to rebound. Caution may be one of the best ways to describe the economy going forward for the next several years. Uncertainty is an overwhelming problem. Many customers will not feel safe coming back right away.”
The following are a synopsis of the main questions the authors say you need to research, answer, and plan accordingly:
- Will there be a new norm for my business? To determine the answers, talk with your customers, suppliers and trade organizations. What problems do they foresee and how will they deal with them?
- Have your customer’s needs changed and what will you have to do to fulfill those needs?
- What must I do to communicate I have created a safe environment for my customers to shop?
- If I have seasonal merchandise that has peaked, what must I do to move it and make way for new offerings?
- Can I depend on my supply chain as many suppliers have gone out of business?
In addition, you must plan sales, inventory, and expenses.
- Plan your sales for at least three months by dollars, units, and classifications. Further break them down to weekly goals in order to quickly make changes as may become necessary. Be conservative in your projections.
- Your inventory should be planned by month, based on how many weeks of sales you have on hand and on order. Try to negotiate favorable payment terms with vendors.
- Every expense item should be analyzed in as much detail as possible. Eliminate any that do not directly or indirectly support sales.
- From a marketing standpoint your number one expense must be your online presence. Your website, Facebook and Instagram are critical marketing tools. Also consider direct mail for special offers or announcements.
Messer’s Spiro and Carleton remind you that CASH IS KING. Create a cash flow analysis of projected income and expenses. Be conservative on the income projections and realistic on the expense side, including a 10% reserve for the unknown.
To obtain a complete copy of the Survival Guide email me at email@example.com
Gray Poehler is a volunteer with SCORE Naples. Business counseling on this and other business matters is available, without charge, from the Naples Chapter of SCORE. Call (239) 430-0081 or visit https://naples.score.org/mentors .The SCORE business office is located at 900 Goodlette Road North, in the Fifth Third branch bank building. Office hours are 9 a.m. to noon, Monday through Friday.