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Tips to Increase Retail Sales for Your Small Business

This past year has been incredibly hard on retailers, especially small businesses. Retail sales plunged more than 20% between February and April last year, but with pandemic restrictions easing, the industry is starting to recover. As folks are venturing out more, it’s the perfect time to refresh yourself and your sales associates on tips to help increase retail sales and work towards building your business back up!

Make your customers feel safe

Many people are finding it tough to return to their pre-pandemic selves quickly and are still moving with caution. Help them feel at ease by reminding them they are safe in your shop. Take note of what protocols major retailers are following. For example, make hand sanitizer available at the entry and the register. Use signage to share your mask policy, your cleaning protocol, and any policies on the dressing room or how to use ‘tester’ products. The safer customers feel, the more likely they are to make a purchase which will help increase your retail sales.

Curbside pickup and local delivery

 Many stores began offering curbside pickup and local delivery in 2020, and most customers have become accustomed to these services. Keep in mind that today’s customers value convenience,  so continue to offer these alternative methods moving forward. 

Train your staff

While you’re refreshing your team on cross- and up-selling, make sure they are up to speed on the basics, too. For example, do they need a reminder on any specials or promotions you’re offering? Ensure they are experts on your store’s products and that they are as informed as possible on your customer service expectations. Encourage them to think ahead to how they might answer specific questions customers might ask, including all frequently asked questions. If your staff can put your customers at ease, they are more likely to purchase from you than your competitors.

 

A sales woman upsells a product to a customer at checkout

Cross-selling and up-selling

The savviest sales associates know how to cross-sell and up-sell. When a customer is interested in one particular item, the savvy salesperson suggests a corresponding item to go along with it. “If you like that, you will love this, too!” Up-selling is suggesting a more expensive alternative to the item the customer is already interested in buying. “Oh, that one you have is great, but have you seen this (more expensive) version?” If your customer leaves with an item that they will enjoy more and feel like they got a great deal, they are more likely to be a repeat customer which can further help increase retail sales.

Merchandising

Make the way you merchandise or display your products a priority. Keep your displays fresh and regularly move merchandise around the store, which creates a sense of newness and will have your regular customers looking at products they may have otherwise passed. Feature new and seasonal products near the entrance. Keep everything clean, organized, and make sure it’s easy to navigate the store. Keep popular and inexpensive items near the registers to encourage impulse purchases during check-out. You should also keep up on your inventory accounting to ensure that those displays have enough product on them.

Make it personal

 80% of companies are more likely to purchase from a company that offers them a personal experience. So how might your store offer a personal touch? Branded items are a great way to creatively connect with your customers – make sure your logo or taglines are on bags, receipts, and automated email receipts. Consider slipping an extra treat into shopping bags, too. Perhaps a small button or magnet with your logo and website. And the best way to get personal is to really connect with your customers. Make it a priority to chat, remember their names, and take note of the types of products that interest them.

Loyalty programs

Customers love loyalty programs! Many small businesses still enjoy using classic “buy 10, get 1 free” style punch cards, but there are great digital-focused loyalty programs, too. Options like Loopy Loyalty and Smile.io encourage customers to shop with you again and engage with your brand. And get creative! These programs offer ways for you to customize the program to match your branding and speak to your customer. As you build your loyalty program, make sure you aren’t creating an unattainable goal. Earning $5 for every $25 you spend feels much more exciting than earning $1 for every $50 you spend, right!?

Make time to analyze

Small retail store owners are notoriously stretched for time, but it’s essential to set aside time to review what sales tactics are working and what aren’t. Look at the numbers and strategically think about what might have led to increases or dips in sales on any given day. This is where having professionals like the team at Xendoo manage your retail bookkeeping can go a long way. Through accurate and timely reports, you can quickly review the numbers and figure out what sales strategies are most effective.

It’s an exciting time for retailers to have a fresh start! Seize the opportunity and train your staff on new sales tactics, refresh your inventory offerings and displays, and get creative with new ways for your customers to engage with your brand. By outsourcing your bookkeeping and accounting to the team at Xendoo, you’ll save time and money, and you’ll finally have the data you need to be more strategic about how to increase retail sales and remain profitable.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

Time for a Makeover: Ideas for How to Increase Profits for Hair Salons

Editor’s Note: This post was originally published in October 2018 and has been updated for accuracy and comprehensiveness.

Just like your clients, your business operation needs a good makeover every now and then to help increase profits for your salon and keep your bottom line healthy. Unfortunately, we sometimes let ourselves get into a rut, keeping the same systems and processes in place mainly because they’ve always been good enough. But is “good enough” really good enough in an ever-changing marketplace? Do you really ever have enough revenue?

Here are ideas on how to increase profits for your hair salon.

Implement a Revenue Management Plan

Is your salon backed up with more business than you can handle on Saturday but full of tumbleweeds on Wednesday? If so, maybe you need to take a look at scalable pricing instead of just charging the same flat price to everyone. Unless you’re ready to expand your business, you have a fixed amount of capacity each day because you only have so many chairs and so many stylists. That means the one tool you have at your disposal to manage supply and demand is your pricing. Don’t be squeamish about raising prices where you need to. If you’re turning away business because you don’t have enough capacity, that means you aren’t charging enough. If you don’t have enough business to fill the day, that means you might be charging too much. In a perfectly balanced supply and demand scenario, you should be running at close to 100% capacity and not turning anyone away because you don’t have open slots. Charge a premium price on high-demand days like Saturday and run discount offers on slower days to incentivize demand and pick up that incremental revenue.

A salon owner checks her profit marginson a tablet

Outsource What You’re Not Good At

Your accountant doesn’t do hair, so you shouldn’t be doing tax returns. There’s a saying in effective management training: only do what only you can do. Stick to what you’re good at and outsource other things that aren’t in your wheelhouse. Those things are time-consuming and draw your attention away from what you should be doing – growing your business. At the top of most lists of tasks to outsource is bookkeeping for hair salons because it’s both complex and time-consuming. An accountant is an expert and can probably do in an hour what might take you an entire day, so it doesn’t make sense to waste your productivity on that. This is where a partner like Xendoo can help you because we specialize in small businesses like yours for a flat price that’s often less than what you would pay an hourly accountant. 

Do a Sales and Inventory Analysis

Do you know the sell-through rate of everything you keep in your inventory? If not, you should. Are you keeping enough of the right items in stock or too much of the wrong things? If you’re not sure, you might have too much money sitting on the shelf month after month doing nothing for you, so you need to do some homework. Print out some sales reports from your point-of-sale (POS) system and see which items are your best sellers. Most good salon software systems also have some inventory control features, so take a look at those to see how to increase profits. One key calculation you need is the sell-through rate, which is the ratio of inventory sold during the month to the inventory added in the same period. If your POS doesn’t have inventory control features, it might be worthwhile to look at upgrading to one that does. 

A stylist talks to her customer about additional services

Up-Sell and Cross-Sell Aggressively

When people hear about up-selling and cross-selling, they often have thoughts of trying to sell clients products they don’t need, but that’s not the case at all. Clients come to you for your expertise. As a salon owner, part of your job is to educate your clients about products and services they need but don’t realize they need. For instance, if a client comes in wanting a particular color treatment that you know from experience will be harsh and make the hair dry, you might recommend a conditioning treatment to help mitigate that effect. Once the client understands and sees the value proposition, it becomes a win-win: the client gets better service, and you get more money.

Spend the time to make sure that everyone on your team is intimately familiar with every product that you carry and can discuss them with clients appropriately. Also, encourage your staff to use the products you sell and promote them in conversation with friends and social media. People trust their stylists and often feel like they’re getting a little inside scoop by using the stylist’s same products. 

Get Creative with Marketing

At the risk of stating the obvious, marketing is key to how to increase profits for your hair salon, and your strategy needs a refresh occasionally. If you’re in a mall or other high-visibility setting, create a nice-looking display in the window where passers-by can see it easily. Stock it with high-margin products you want to promote and put the most important items at eye level. Research has shown that “eye level is buy level.” That’s fairly traditional marketing, but don’t be afraid to get creative with it. Have you noticed that almost every store you visit these days wants to sign you up for a rewards program? Well, there’s a reason for that—they work. Customers love rewards and free things. Consider creating a loyalty program for your return customers and give them a $25 coupon after ten visits. Word of mouth is one of your most powerful marketing tools, and you can leverage that. Implement a referral program where an existing client who refers new business gets a discount on the next visit.

These are just ways on how to increase profits for your hair salon, but Xendoo can help you increase your profit in other ways, too. Contact Xendoo today to start your free trial and get your business on the road to maximum profits.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

A Prettier Profit and Loss Statement: Up- and Cross-Selling Techniques for Salon Owners

Editor’s Note: This post was originally published in October 2017 and has been updated for accuracy and comprehensiveness.

If you’re like most salon owners, the chances are good that you decided to start a hair salon because you love meeting new people and helping them feel more beautiful than when they walked in your front door. It’s only natural because everyone loves a rewarding job. Focusing on sales techniques, like up-and cross-selling for salons probably wasn’t high on your list of “pros” when you got into the salon industry.

But for better or for worse, persuading clients to purchase products or services that they didn’t initially come in for is an essential part of your marketing strategy and can boost your profit and loss statement. That doesn’t mean selling them products they don’t need. Cross-selling and up-selling are selling them products they need but didn’t know about. It’s part of your job to educate the client, so let’s take a look at how up-selling and cross-selling for the salon business can be less faux-pas and more moo-lah, and why salon owners already have a head start. 

Two women in pola dotted dresses work at a hair salon

The Difference Between Up-Selling and Cross-Selling

Up-selling is the practice of encouraging customers to purchase a more expensive item than they had initially intended. We do this by creating value for the customer in the more expensive product. Often, the customer just needs someone to point out the extra value. Depending on the type of salon, if a client is scheduled for a regular mani/pedi at retail price, check-in staff can create value for the customer by offering a deluxe spa treatment for just a slightly higher price. You might even be able to have your salon software automatically remind staff to offer the upgrade at check-in. If the customer is already spending $50, it’s easy to justify upgrading for just $10 more because it represents a good value.

Cross-selling for salons is the practice of encouraging customers to purchase other products or services that complement the original sale in some way. Sometimes customers don’t know what they need, and it’s your job as the expert to educate them about it. Effective cross-selling for salons might look like this: If a dark-haired client has decided to go blonde, you as the stylist know that those harsh chemicals can damage and dry out the hair, but the customer may not know that. You can explain this and encourage your client to buy a conditioning treatment to help offset that damage.

Why Cross-Selling and Up-Selling Are Important

 The bottom line is that up-selling and cross-selling for salons are critical to your bottom line in several ways. If you’re not doing it, you’re leaving money on the table. If you have a low-margin product that’s selling great and a high-margin product that’s not selling so well, an excellent cross-selling technique might be to bundle the two together and get that extra profit. But even more importantly, it allows you to create additional value for your customers, which is crucial to maintaining customer loyalty and trust. After all, value is why your customers come to you to begin with and what makes a successful salon. When deciding whether a sales opportunity is right, ask yourself, “Will this improve my customer’s life? Will it help them feel more beautiful?” If the answer is yes, you know what to do.

A woman hair stylist chats with a client.

So What’s This Head Start?

Salon business owners have a special trust relationship with their clients, which gives them an edge in ideas to increase profits. Stylists don’t just know their customers’ names; they know everything going on in their lives —their children, jobs, and health. They open up their entire lives to you, which puts you in a unique position of influence with your customer. To put it more bluntly, if they trust you enough to let you bring sharp blades around their heads and irreversibly alter their appearance (for a few months, anyway), they will trust your recommendation on special products and services. Remind your team that they have this superpower because it’s critical to your business, but don’t abuse it by selling customers things they don’t need. That will almost always backfire and damage your relationship.

OK, I’m Convinced. Now What?

Now that you know the importance of upselling and cross-selling for salons, here are a few things you can do right away to get the ball rolling.

  • Get effective inventory management and accounting system for your salon if you don’t already have one to know exactly which products are moving and which aren’t, and what the margin on each one is. Good accounting for hair salons is a must, and if you don’t have that information at your fingertips, you’re flying blind.
  • Create an attractive display with high visibility where customers can browse it easily. Never put it behind the counter because curious customers will feel like it’s inaccessible. Keep it organized, and well-stocked with the products that you believe are strong candidates for this strategy. Remember: eye-level is buy-level. Research has shown that products placed at eye level get 35% more attention than products placed at lower levels.
  • Ensure your staff is using the products you sell and posting them on social media. The best advertisement for a product is being able to see the results in real-time on a person’s natural hair or skin. Remember the trust relationship; if the stylist uses the product, it gives the customer confidence that it must be good. It’s almost like giving away a little trade secret. Purchasing salon-quality products that stylists actually use makes your customers feel like they have a leg up in their beauty routine.
  • Give your staff the tools to make cross-selling for salons easier. At a minimum, everyone in your salon should be familiar with every item you sell and be able to describe it to customers. But knowledge of the products is only a start. Your team needs to be trained in effective cross-selling and up-selling techniques and incentivized to use them. Be creative in coming up with ways to encourage selling, like contests with prizes, bonuses, or other incentives.

Remember, you may not see the benefits of cross-selling for your salon business right away. Sometimes the customer may be in a hurry or on a tight budget, and you have to respect that. Just remember that by maintaining the customer’s trust, there will always be another opportunity down the road. Do that consistently, and you’ll begin to grow your business and watch your bottom line trend up.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.