There are several different ways to confront a sales slump – which will be most effective will depend on your business, and where the gaps are in taking advantage of your target market. In this instalment, we look at your product and how it could be moulded to enhance its sustainability. We suggest coming at it from several different angles, maximising your chances of success.
Let’s look at the heart of your business: what do you sell? How can you make your product more likely to sell, when its appeal seems to be dwindling? Here are some of our favourite tips for refreshing your offering.
Focus on seasonality by allowing your product to evolve with the time of year. Using seasonal menus, restaurants tap into the desire for comfort food in winter and lighter meals in summer, while managing costs with locally abundant ingredients. The idea is fundamentally the same, no matter what you sell – For example, a homeware store could stock scented candles in spiced flavours when it’s cold, switching it up with floral diffusers in Spring. Equally, a Spa could offer specials on hot stone massages in June, and invest in cryotherapy technology for Summer.
Address the balance of stock by altering the mix of products, to maximize the percentage of high-profit items on display. This ensures that whatever you do sell, will make the best possible impact on the bottom line. Make your presentation as inviting and impactful as possible, in areas with the best lighting and easy access. Remove or minimise your low-profit selection, keeping just enough stock to meet pre-established expectations.
Release a new product – whether you’re feeling insecure, or baffled by a lackluster performance, releasing something new creates a buzz, refocuses attention onto your brand and reinvigorates your entrepreneurial spirit. A nifty trick is to tap into a niche-market – For example, a bakery with an innovative selection of gluten free desserts; a retailer who focuses on sourcing unique, local products; or a spa that launches the newest cutting-edge treatment. Think creatively about your clientele and how you could extend your brand in exciting ways, that elevate what is working.
Release a new accessory or enhanced benefit, to an existing product. This not only makes it more desirable, but means those who have already purchased from you have yet another reason to return. For example, a coffee shop that sells ceramic take-away mugs with discounted future refills, or a salon that offers packaged products to use at home, deepening and extending the effects of their spa treatments.
The creative use of by-products is often overlooked, because it feels like a diversion. However, there are always extra resources in any enterprise, which could be moulded to become income-generating. But, whether these opportunities should be explored, will depend on their individual feasibility. For example, if you operate by day, consider hiring out your premises after dark. If you open at night, could you host business events during the day? Or, can you teach other people to do what you do? Often, these “by-products” are not physical things, but ideas, methods and other intellectual capital. The important thing is to look at diversifying the business’ revenue stream, in a way that takes better advantage of what you already have.
Get rid of unnecessary stock on hand, especially products that are not moving, or the “ingredients” used to make them. For retailers, use a clearance sale, or sell discounted raw materials to another business – but don’t panic-sell if last year’s data indicates a healthy uptick, just around the corner. For restaurants, the considerations are different: If a particular dish is not selling, use a special to move any prepared stock. Alternatively, start over, look at what you have in the fridge, and create an entirely new dish. In both cases, accepting a slightly higher food cost is better than suffering direct spoilage losses.
In Part 3, we tackle the vast topic of effective marketing on a tight budget and explore the power of using creativity to reconnect with your business’s natural personality.