Designing the Perfect Retail Audit
Often we find ourselves faced with what seems at first to be an impossible task. When running a retail store, such monumental tasks include improving ones business. Making your business successful, and ensuring its continued success. But how does one ensure the success of their retail business? The best path to retail success is by conducting regular retail audits to remedy problems and identify trends. So now you may be thinking, “Great. But how do I begin designing the perfect retail audit? What should I be looking for?” Well, when it comes to retail audits, improving your business is as easy as examining the following three keys areas:
- Operational Trends
- Customer Experience
- Employee Performance
Understanding operational trends will help you identify the following:
- Where your retail business is excelling
- Aspects of execution that require attention, and
- Possible areas of opportunity
Auditing key data points will help you uncover store tendencies and sales progressions over the course of a year. These include (but are not limited to):
- Sales Volume
- Stock Levels and Inventory Management
- Product Placement
Each of these items tells a story that will provide the insights needed to help you keep driving your business towards success. Understanding the aggregate number of items sold over a period of time, in relation to the prior week, month, or year can help you identify the types of items that are selling or not selling well during a specific time frame. This can help you determine what items to stock and when.
Knowing what items to keep in stock is critical to successful inventory management. Recognizing how quickly inventory is sold in relation to the storage space available at your establishment can help you decide which items—and how many items—need to be sold before the product becomes outdated. This knowledge can help you not only manage and plan your inventory needs through each season but will also help drive product placement in your store.
Where you place products and how they work together to relay or spark an emotion, greatly impacts the experience your customer’s in-store experience. Since customers are more likely to purchase multiple products within a display when those products coincide logically with one another, product organization can also be used to help drive sales. Understanding which products are most often purchased together can help you decipher trends and adjust the products you stock, accordingly.
A business is not solely dependent on sales for its success. It is also important to develop a deep understanding of your specific customer demographic. To this end, customer satisfaction is another key factor in retail auditing. Without a solid understanding of your customer base, your business cannot succeed. Know what makes them happy, and understand what has them walking out of your store without making a purchase. This is key to understanding how and why your business is performing as it is.
A customer’s in-store experience is dramatically impacted by the quality (or lack thereof) of the store environment and the interpersonal interactions that occur, including (but not limited to):
- Store Cleanliness
- Customer Service
- Employee Professionalism
One of the first things a customer will notice when he walks into your store is the tidiness of your establishment. If your store is organized and neat, a customer is more likely to stick around and shop and eventually make a purchase, as the care you and your employees show in maintaining a welcoming workplace is clearly on display.
Customer Service is another key factor in building brand loyalty—both in-store, online and over the phone. Ensuring your staff is properly trained to handle specific situations that may arise—including disputes over returns or exchanges, or simply teaching them how to be appropriately assertive in helping a confused customer locate a product—can influence a customer’s decision to make a purchase or to avoid your store in the future.
When customers do return to your store, they have a preconceived notion of what they’ll experience and the quality of service they’ll receive—based on their prior visits. As buyers become more educated and—as a consequence, more particular—about where, why and how they spend their money, knowing just how your employees are performing and interacting with shoppers is key to encourage return visits to your store. Thus, Employee Professionalism is the third common component of retail auditing.
Additional common considerations for employee audits include:
- Training Completion
- Individual Sales Performance
Punctuality, consistency, and alertness are key employee traits that are beneficial to audit. A business cannot be successful if its employees fail to open the store on time, assist customers or familiarize themselves with the inventory. Setting standards and expectations around these behaviors are key to building a successful, profitable team.
Ensuring proper training is available, utilized, and completed is another element vital to store success. Providing employees ample opportunity to understand store operations and best practices, and coaching them in proper customer engagement practices, empowers your staff to take pride not only in their work but also in your business. These are all key contributors to employee performance.
Understanding your employees’ individual strengths and weaknesses can help you determine how best to utilize your personnel to drive the success of your business. Understanding your customer base can help you build a successful and long-standing brand. And understanding operational trends can help you uncover opportunity. All of these factors are key to designing the perfect audit for your retail business.