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Supply Chain Management, CPG KPIs & Reporting

5 Steps To Cutting Costs In Retail

5 Steps To Cutting Costs In RetailBalancing service delivery against the need for economy is something that every retailer faces – the need to cut back while remaining competitive and ensuring sufficient staffing is key. However, cutting costs in retail isn’t just about reducing spend and minimising budgets. Increasing efficiency and introducing innovative solutions to cost-heavy problems can make as much – if not more – impact than streamlining alone.

Step 1: Economise

Cutting expenses is the most basic option for reducing costs and may involve either reducing current outlay or, more drastically, identifying what a business can do without and then cutting it. There are numerous areas where savings can be made by reducing costs, including overtime pay, business insurance, phone and utility bills, card processing fees and banking and professional fees. To make larger reductions, look to areas such as cleaning, subscriptions, staff mobile phones and expensive packaging options, which could be cut altogether.

Step 2: Footfall Analytics 

Comprehensive footfall analytics offer unprecedented insights into the way a business is functioning that can be used to reduce cost. Identifying conversion rate profiles and patterns and monitoring store performance allows for the introduction of changes that reduce wasted spend and focus resources on productive areas. Footfall analytics can be used to monitor the success of marketing campaigns to boost ROI and identify correlations between sales volume and footfall levels, which can result in streamlining operational change.

Step 3: Queue Management 

Managing store queues feeds into everything, from conversion rate to customer loyalty and so has a direct impact on cost. With queue management budgets can be better used and a workforce managed to ensure queue demands match staffing patterns. Queue management data can provide key insight into the days that offer the most opportunity in terms of conversion rates and can result in efficiency changes being introduced on the basis of poor performing hours.

Step 4: Automation 

Identifying employee tasks that could be automated can save businesses time and money. Those repetitive activities that don’t really require human input, but eat into employee hours, are switched to an automated process to save time. In the context of cost, if you can save 80 hours of time per week that’s the cost of one or two employees. Areas for automation could include data entry, appointment booking and even sales via the use of self service check outs.

Step 5: Mobile Customer Relationship Management (CRM)

There are significant efficiencies available by providing staff with mobile CRM tools that allow queries and needs to be dealt with on the spot. Appointments can be scheduled and tracked, clients prioritised and communication between team members improved, from sharing shelf locations to reminders about new products. All this means more efficient customer management and a more streamlined staff.

 

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Chris Miles

Chris specialises in marketing and content development in the retail world, he has worked with companies all over the industry and now indulges in freelance writing for retail focused companies.

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