5 Important Lessons SMBs Can Learn from Retail Giants
As an SMB, you’ll never have a shortage of sources for tips and insights. From retail websites (such as this one) to mentors and fellow retailers, there’s always somewhere to turn to for business advice and best practices.
Another great source of business insights? Larger companies. You might think that you don’t have a lot in common with big box stores and retail giants to gain meaningful insights, but the fact is, SMBs can pick up lots of valuable lessons from these businesses. Big companies have plenty to impart, especially when it comes to managing growth and operations. Check out some of those lessons below and see if you can apply them to your business.
Invest in technology to increase efficiency and get more done
For many large retailers, the secret to keeping business operations humming lies in technology and automation. They have the proper systems and tools in place so they can spend less time worrying about the little things and spend more energy on the big picture.
As a small or medium business, you too should find ways to incorporate technology into your operations. Go through your existing processes =and identify manual tasks that you can automate through certain programs or apps.
Consider what Crane Brothers, a contemporary menswear retailer, is doing. To save time and operating expenses, Murray Crane decided to automate the task of transferring sales data to his accounting software. Rather than manually plugging the numbers into the program, he integrated his point-of-sale system (Vend) with his accounting software (Xero). He got the two programs “talking” to each other, so information is automatically transferred from one system to the next.
The result? Murray was able to free up time so he and his staff could devote more energy to helping customers. He also estimates that the automated system in his store saves him forty to eighty hours a week — or one to two full-time employees.
Data entry isn’t the only thing you can automate. These days, there’s (usually) an app for most of the tedious administrative tasks in your store.
If you regularly make appointments with customers, for example, consider using an app such as Timely, which streamlines bookings and sales, and even sends automatic appointment reminders to your clients. Do you spend a lot of time managing employee shifts? Check out Deputy, which lets you and your staff coordinate schedules from your mobile devices and sends shift changes and notifications for you.
Learn to delegate so you can focus on the big picture
Anyone running a major corporation will tell you that it wouldn’t be possible for a business to scale if the owner tried to do everything. That’s why for the sake of your business (and your sanity) see to it that you’re appropriately delegating tasks to your team. Doing so will free up your time to focus on actually growing your business.
“Many entrepreneurs like to do things their way and struggle with delegating workloads, but they can look at large companies that do this — well and often — as a guide for passing work down to team members the entrepreneur may focus on other priorities,” says Deborah Sweeney, CEO of MyCorporation.com
“Letting go, not hoarding the work, empowers your team and enables a small business to expand, providing its team members with growth opportunities that match their skill sets.”
Be more data-driven and improve decision-making
Large business rely heavily on data when making decisions. Every promotion or product that they invest in is rooted in information gathered from surveys, focus groups, and big data solutions.
Here’s the good news: you don’t have to be a retail giant to get your hands on valuable data. There are plenty of tools in the market that can help you gain the customer and industry insights you need.
Most modern POS or retail management systems have reporting capabilities that allow you to track sales, inventory, and customer behavior. And if you’re selling online, you can use a tool like Google Analytics to monitor traffic and online sales.
Such solutions help you make smarter decisions in your business. For example, looking at your sales reports will tell you exactly which products or suppliers are driving revenue so you can plan your stock orders accordingly.
That’s what happens at Podarok, an England-based retailer selling hand-made gifts. Podarok owner Andrey Pronin shares that they constantly use their POS system to dig into their sales data so they can make more reliable decisions.
“My favorite feature has to be the sales reports. By day, by month, by period, by hour, but most importantly, by supplier,” he says. “We can predict what is going to happen next year and therefore plan our staff rosters and product ordering in advance. This saves us a lot of time, and therefore money. We only order what we need and know that will sell. We are also able to order only as much as we need because we can see how much was sold before.”
Have formal staff training programs in place to turn people into top performers
Retail giants devote sizeable resources to employee training and development. Not only do they have formal onboarding programs in place, but most offer rigorous training and provide opportunities for continuous development.
Just like in big businesses, you also need to invest in your staff training practices. Doing so doesn’t just make learning easier and more effective, but it also sends the message that you take staffing seriously in your business. This, in turn, can have a positive effect on employee performance.
So how exactly can you improve staff training in your company? That depends on the existing processes you have in place. But a good first step is to formalize how staff training and education programs are carried out.
For instance, instead of an informal training session for new hires, why not develop a comprehensive training plan? Or, rather than just verbally instructing your employees about how things are done in your store, make sure your policies and processes are documented and accessible by your staff. Consider uploading learning materials online (even if it’s just a shared Google doc), so your employees access the materials from anywhere.
Don’t have the resources to develop courses or programs yourself? Consider partnering with third-party education providers. The NRF (National Retail Federation) Foundation, for example, recently launched Rise Up, a training and credentials program for retail workers. Rise Up offers courses on retail fundamentals, customer service, and sales, and it aims to provide learners the tools and knowledge they need to succeed in a retail environment.
Embrace innovation to stay ahead of the competition
Trying new and innovative things is critical if you want to stay competitive. Large businesses are aware of this, which is why they’re constantly trying out technologies and finding ways to innovate. Some companies are taking innovation so seriously that they’re setting up “innovation labs.”
These labs, which usually operate as separate divisions of the company, serve as incubators for new ideas. They are expected to cook up innovative, and sometimes even futuristic solutions that the retailer can put into action in the real world.
While you may not have the resources to build your own lab, that doesn’t mean you can’t innovate in your company. Sometimes, simply instilling the spirit of innovation into your culture can do wonders for your business.
How can you do this? You can start by urging your team to think of creative and forward-thinking ways to solve problems. Go beyond traditional methods and strive to think of “next generation” solutions for the issues you have.
Encouraging collaboration between different departments can also spark innovation. Allow your team to put their heads together and combine their expertise to come up with new methods to move your business forward.
One retailer that did this well is Discount Tire. The company wanted to reinvent their customer’s shopping experience, and to do that, it teamed up with SAP and “embarked on a journey of discovery.”
According to the SAP case study:
In order to acquire a first-hand understanding of the customer experience, the SAP Mobility team from Palo Alto went on site to observe the operations at Discount Tire’s stores. To further explore options on how to assist Discount Tire with their store operations and wait times, SAP conducted a two-day Design Thinking workshop with Discount Tire to examine how mobility might improve wait time.
“This was really an eye-opening experience and enabled Discount Tire to look at their business in a different way. Discount Tire felt that their company needed to move forward in ways they had not previously considered”, recalls Shelley Schwartz, Retail Executive Solution Engineer at SAP. The second day was dedicated to a more open-ended problem finding; that is discovering unknown needs and generating ideas for their business in the future.
As you can see, the simple act of observing your existing operations and encouraging people to think creatively can bring about new ideas and solutions. That’s why if it makes sense for your company, consider implementing this exercise in your business. Get various teams together in a room and encourage them to think of out-of-the-box solutions for problems that your company or customers are facing. Who knows? You might just come up with an innovative solution to apply in your business. And if you don’t, then you and your staff would have at least gotten the chance to collaborate and learn from one another.