Hi Everyone,

My name is Kevin Thomas, i am an Article writer for SOVA fashion boutique online.

I want to give my input, suggestions toward the leading topic that is affecting small business far and wide, "credit crunch". 

But remember any financial implications there is no substitute for the advice of a professional.

Everyone has seen in the media and on TV, we are in a recession and with this come the uncertainty of business confidence, felt by all industries.

Small Retailers are obviously concerned because behind the recent announcement of some bigger stores going into administration, smaller retailers feel the pinch much harder and in some cases eventually fail to survive and close down.

You need to pay more attention to your business, if you have any loans, you need to speak to your Business bank manager and get as much financial advice for the times ahead.

Focus your energy not on the present crisis, acknowledge it of course but apply your energy on your business as you have the power to change things in that aspect.

So what can the small independent retailers do to compete with their larger counterparts?

Consumers are expected to rein in spending this next year if not already, in general they are changing there spending habits in reaction to the "credit crunch".

The main element that consumers want is "quality" in the products they purchase. I can safely say gone are the days of the cheap – cheap clothes buying in abundance.

It makes sense to buy quality clothes or even better a combination of classical outfits that will last a couple of seasons, whilst the money is tight, rather than wastefully buying cheap garments that lasts from "Friday to Monday".

Although the retail climate favours the large chain stores that can offer bargains. Small retailers can't win price wars, but they can leverage their biggest advantage over the chains stores.

This is personal relationships with the customer and the ability to deliver superior service. Small retailers can bolster sales by targeting wealthier shoppers who are less price-sensitive and may pay premiums for better service.

Steps that independent retailers can make to compete:-

Small Retailer Market Targeting

Maximise your one to one personal relationship with your best customers, it just means going that extra mile to gain confidence of loyal customers who will remain shopping with you.

One way to do that is through affinity discounts (special discounts to special group of people) that encourage loyal customers to spend more, rather than trying to attract new business by cutting prices across the board.

Go to your customer _base_ and mail to them your best targeted discount to shop with you.

It's a lot better than advertising a 70% off sign in front of your store. Through affinity programs, retailers can strengthen their relationships with their best customers and appeal to those shoppers' bargain-hunting mood at the same time.

Scrutinise your business inventories to keep costs down

• Store owners should be especially vigilant in refusing late orders and watching for over-shipments to avoid having merchandise they won't be able to sell.

In addition, small retailers can "take a leaf out of the book" from large chains that display as much merchandise as possible on the floor, rather than holding inventory in the stockroom.

The major stores adopt a culture of just in time stock level. They want all the stock out there with the customer and not in the storeroom.

Watch staffing levels to control costs

• Staff at peak hours as much as possible, this means mostly evenings and weekends, as most two working couples in families have little time to shop during the day.
• Business could open later in the day and extend hours in the night to reach more customers without the need to employ more staff and more hours.

Retailers re-align your online and shop store to introduce ‘Reserve and Collect'

• You should adapt to the reserve and collect method, combining activities of your online store in parallel with the shop store.

Reserving items online for collection at the store means your customer will be guaranteed to receive what they are after.

The benefit for them will be saving in delivery charges, having not to wait for delivery, and they can get their items the same day.

All the luxury of shopping online and the convenience and instant gratification of going and picking items up from the shop!

Collecting their goods from your shop is a great way for the customer to get their stuff quickly – and reserving online ensures that it's in stock when they get there!

Everyone don't give up!

Kevin Thompson
SOVA