With all this talk of a recession, interest rate hikes, inflation, wars, and more interest rate hikes, it’s no wonder the average Aussies retailer is crying, “How much can a koala bear?”
Yes, it’s been tough. But tough events are a part of life. So it’s up to us Aussie (and Kiwi) retailers to dig deep and keep exploring innovative ways to improve our businesses. This process will teach you valuable lessons on how to build a strong, sustainable and recession-proof business that will see you through the wildest storm.
First up, is Australia actually in a recession?-
According to a July 2022 report by ABC News, “A recession is defined by two consecutive quarters of negative economic growth.” Former Treasury economist Warren Hogan believes “there is now a 50% chance of a recession in Australia next year.”
This high chance is due to our increasing interest rates, slower global growth, and reduced tolerance for larger budget deficits. But there’s good news.
Hogan believes, “The recession will be shallow, short-lived and followed by a strong recovery.”
Whichever way things turn, let’s get on with the show — and get to work. Besides, who knows where this positivity and determination may lead you?|
Developing a sustainable, recession-proof retail business is only possible with powerful retail POS software. Retail Express cloud-based software gives you advanced features straight out of the box — without the heavy price tag. Get a free demo today with an Australian-based retail expert.
Your 8 tips to creating a sustainable, recession-proof retail business-
1: Cut down on debt{Cut down on debt}
Note, we don’t advise that you stop spending; we advise that you stop haemorrhaging. Spending is necessary when times are tough, so you’ll need to have money in reserve. Examine your business keenly to detect wastage. Are there services you no longer need, subscriptions you can live without, cheaper rental spaces or more competitive providers?
Once again, fix leaking buckets — don’t cut corners. When things get tight, it’s tempting to compromise on quality, trim services and shortchange your customers. But the last thing you need to do is tick off your customers, which is an excellent conduit for our next point.
2: Value your customers{Value your customers}
Be completely customer-centric; treat your customers as your number one priority. This steadfast focus will keep you in tune with their needs while keeping you agile and adaptable. True business leaders realise this importance and focus on respecting and rewarding them at all costs.
Harvard Business Review says it best:
“Leaders recognise that they should manage their businesses to maximise the value of the customer base. But too often, earnings pressures result in cost-cutting measures that hurt customers.
“Loyalty-leading companies operate differently. They create systems for measuring customer value and invest in the necessary technology; they use methods to build customer loyalty; they organise the business around customer needs..."
Here are a few doable tips; however, they’re a lot easier with marketing and loyalty software:
- Use your loyalty software tools to count the number of gross new customers versus repeat customers. Regularly report the results along with activities that may have affected them.
- Study your buyer behaviour reports in your marketing and loyalty software. Likewise, create and leverage your customer profiles.
- Create a systematic process with your floor staff to measure customer feedback. Whether keeping notes on a document each time there’s verbal feedback or asking clients to complete a quick questionnaire, find out how they feel and let them know that you care.
- Create automated emails or SMSs to customers after each purchase. Not getting any replies? Try incentivising them.
- Reward your repeat customers. Again, you can automate this process with good loyalty software for retail businesses. You can even provide tiered loyalty programs and special discounts for loyal customers.
3: Improve the customer experience{Improve the customer experience}
All this talk of customer loyalty is worth it. Besides, we know it costs a lot less to keep an existing customer than it does to acquire a new one — and the stats are everywhere on the Internet. Invespcro says it’s five times as much; Harvard Business Review quoted between five to 25 times. There’s more and more proof everywhere, but you get the gist.
Improving your customer experience (CX) makes creating the loyal customers you need massively easier. Then, customers become lifetime brand ambassadors, not one-off shoppers. Right now, it’s vital, which is why we have several articles on improving customer experience here:
Ultimate customer experience examples & actionable tips for every ANZ retailer
Why exceptional customer experiences are vital in 2022
How live stock tools are helping retailers excel at customer experience
How to set up & launch a Click & Collect Strategy: a Must-read for Retailers
4: Keep marketing{Keep marketing}
Stay in close contact with your valuable customers. Demonstrate your stability and resilience by letting them know you’re alive and well. If you cut back, your competitors may not, meaning your hard-earned customers may be lining their pockets and not yours.
On a brighter note, there may be fewer retailers advertising in hard economic times, so your chances of a strong return are greater.
Thank your valued customers for their orders using your marketing and email software. And if you need to incentivise, explore cross-selling and upselling marketing ideas in more depth. To learn more, read our recent article on the topic here:
Cross-selling & Upselling Retail Examples + How Software Automation Takes Results Next-level
5: Provide useful information for your online store{Provide useful information for your online store }
Almost every retailer needs a useful, informative and highly functional online shop. Notice how we put ‘useful and informative’ at the top of the list?
Your online shop is an incredibly vital part of your entire business, not just your online presence. It is much more than a showcase or a store to purchase goods.
Your online store should be one incredibly engaging information portal. A place where customers can effortlessly find all the information they need, including:
- Your store locations and opening hours
- Information about your brand, point of difference, ethics, staff and founders
- Reasons why they should trust you
- Detailed information on all products and pricing
- Fulfilment and delivery options, returns and exchanges
- Tips, advice and how-to videos on caring for or using the products you sell
- Links to your social media platforms
- Frequently asked questions
- Readily available contact details
And, of course, it’s also a place where people can buy your products.
The above checkpoints cannot be underestimated, yet so many businesses do. Our advice? If you want a sustainable, bullet-proof business, set the bar. Do better. Your efforts will be rewarded.
6: Make your online store visible{Make your online store visible}
Now that we’ve established the importance of your online store, you must make it visible. Being visible online means pleasing the search engines so that your website appears higher than your competitors — not on the seventh page of Google. A great starting point is providing the info we suggested in the checkpoints above, because search engines appreciate useful, relevant and informative websites that are regularly updated.
But you’ll need to do more.
To help with your search visibility, invest in SEO for long-term benefits. However, be practical. If competition is too steep to win the SEO war, you may need to invest more of your budget in Google ads and social media campaigns. These are internal, subjective decisions you must make with online marketing professionals you can trust.
7: Start collaborating{Start collaborating}
Remember, in tough times, you’re not the only retailer feeling alone, wondering how on earth you can get the biggest bang for your buck. That’s why brand or marketing collaborations are such a good idea.
Retailer collaborations come in many forms — they may be a brand or marketing collaboration or partnership. Either way, they all have great potential to reap the rewards.
Collaborations are excellent because they are:
- Extremely affordable — as you share the marketing or lease expenses
- Something new, attractive and exciting
- A way of expanding your audience by cross-pollinating with your collaborator
- A way to enhance your branding and reputation — by aligning with another trustworthy brand your customers already know, this proves their endorsement of you and hence builds more trust
From the blog: How to Increase Sales in Retail through Brand Partnerships & Collaborations
8: Digitally transform to omnichannel retail{Digitally transform to omnichannel retail}
Digital transformation is where retailers must spend to save and stay ahead of the competition. If you haven’t switched to omnichannel retail already, it’s time.
Integrate your bricks & clicks for greater visibility: With one set of cloud-based data, you’ll know (up to the minute) what’s going on and where. So you can say goodbye to separate systems and reports.
Leverage all store stock online and sell more: One data set means you can display all stock online. There’s no need to manually allot different amounts of inventory for your eCommerce store and your shop. By showing all stock online, you have the opportunity to sell more and give your customers more options. You can offer Click & Collect or ship the item from the nearest store to the customer. There are so many more possibilities for sales.
Enjoy better reporting: Real-time reports give the information you need to make decisions based on data, not hunches. There will be no more guesswork and no more late nights spent hunched over Excel spreadsheets. (Whoop!)
Move your stock where needed: Inventory and fulfilment issues become a lot easier when you have real-time data and smart algorithms that help determine where and when you need to shift stock. Now you can have stock where required rather than marking it down at destinations where it is not.
Open or close revenue streams: If you’re a lean, agile omnichannel machine, you can offer your customers more ways to shop. For example, you can open an eCommerce store, start a pop-up shop or sell on social media. It’s also easier to add registers. Plus, the right point-of-sale software does most of the thinking for you, too, and will let you know how much stock should be allocated where — and when.
Next steps-
Developing a sustainable, recession-proof retail business is only possible with powerful retail POS software. Retail Express cloud-based software gives you advanced features straight out of the box — without the heavy price tag. Get a free demo today with an Australian-based retail expert.
