Retailiatory Strike

Make No Mistake

Beginning retailers make a lot of mistakes. Here are five of the biggest:

1. Not doing a reality check. Do you have the temperament it takes to succeed in retail? "One of the biggest mistakes people make is thinking that retailing is going to be one way, and their experience turns out to be very different," says Daniel Butler, vice president of retail operations for the National Retail Federation in Washington, DC. "They're not realistic about the challenges." Retail is a lifestyle choice. Can you hack it? Butler suggests working part time in retail for a few months to find out before you start your business.

2. Failing to research. Surprisingly, many beginning retailers don't develop a business plan and marketing plan. "When someone comes to me and says 'This is the research we've done, this is why we feel this product will sell and why we'll be successful in this location,' it gives me a greater comfort level [in talking further]," says Courtney Lackey, a general manager with Jones Lang LaSalle, a property management leasing company that manages retail properties.

3. Creating clutter. In retail, you're branding from day one. If your product displays have no rhyme or reason, customers have no reason to stop and shop. "The biggest mistake a cart or kiosk retailer can make is putting [out] too much merchandise," Lackey says. "Something that's well-displayed, colorful and catches your eye attracts customers."

4. Competing with big-box retailers. Face it, as an independent retailer you'll never beat WalMart on price. But a lot of small retailers fall into the price trap of trying to compete with the big boys--a big mistake, says Bob Phibbs, a retail consultant in Long Beach, California. Instead, focus on your edge as a small retailer: customer service and a unique consumer experience.

5. Choosing the wrong location. The rental rate may be great, but if the location doesn't draw people, you might be in trouble even if your product is good. Where are shoppers seeking your type of product going? What types of big-box retailers complement your product and will drive traffic your way? One no-cost way to find out is by sitting in a mall and watching the traffic flow. "If you decide you want upscale people, look at where they're already shopping and how you'd get that market," Phibbs says. "Know all these things {before} you start to sign leases."

Check It Out
It's hard to believe, but many small retailers are still using calculators and electronic cash registers to ring up sales, only to transfer all this data manually to a computer at the end of the day. Why not think about setting up an integrated retail POS software system before you start your business? You have lots of options to choose from. Some major players in this specialized space include , PeopleSoft and Oracle. Here are just a few products on the market:

  • BizTracker: This POS software can run by keyboard or touchscreen and integrate with QuickBooks. In addition to serving as a computerized cash register, BizTracker can track commissions on sales, create electronic and print packing slips. Street price: $995 (one workstation); $1,280 (three-station network).
  • ComCash: This Windows-based, Dell-partnered program allows you to import all your QuickBooks customers, inventory and vendors. It also comes pre-installed with POS, polling, communication and credit card software. You can take the program for a test drive by downloading a ComCash POS demo at Street price: $1,099 (single-station install).
  • QuickBooks Point of Sale Software for Retailers: Designed especially for single-store retailers, this program integrates with QuickBooks 2002 financial software, turns your PC into a cash register and can be customized. Another benefit: You can buy it off the shelf at Office Depot and Sam's Club. Street price: $1,299 for the software/hardware bundle (includes a bar code scanner, a receipt printer, a cash drawer and a credit card swipe); $799 for the software alone.
  • QuickSell 2000: Lets you export data to Windows-based accounting programs such as Peachtree Accounting, M.Y.O.B. and Quick Books, and you can run it on a growing network. Here's an added bonus: Microsoft bought QuickSell in May and is now integrating its features with other Microsoft POS products to offer a complete a small-business POS software package. Street price: starts at $990.
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Chris Penttila is a Washington, DC-based freelance journalist who covers workplace issues on her blog,

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This article was originally published in the December 2002 print edition of Entrepreneur with the headline: Retailiatory Strike.

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