Think in “3’s”
Ask a commercial real estate broker what the most important factors to retail succeess are and you will hear, “Location, Location, Location.” In Retail Selling Made Easy I say they are, “Location, Merchandise and Salespeople.” I was told recently that it’s a sheer matter of how many people pass by the store, leading me to think of another set of three, “People walking by, those entering the store, and what is done with them when they do.”
It’s The Salesperson
I consider the salesperson to be the single most important element. Good salespeople make poor locations look good. Salespeople determine what happens after the customer enters the store. Numbers tell a story. It is important to know how effective your salespeople are at converting “traffic” into “sales.”
A door counter is a good way to measure many things. I used to discourage the use of door counters for fear that salespeople would use the lower numbers on certain days as an excuse for low sales. How many customers you have is not as important as what you do with them. A question that I ask salespeople all the time is, “How many good customers do you need in a day to have a good day?” The answer is always a resounding, “One.” My attitude about door counters changed once we found a way to present this information powerfully as a part of the Morning Report. I am now surprised at the number of retailers that don’t measure their store’s traffic. Without this number, measuring the true effectiveness of your salespeople is limited.
The Morning Report
We have always tracked things like, total sales, sales per hour, average daily sales, and units per transaction on the Morning Report. But with a door counter in place we can track and display two more very important measurables; Sales per Capita and Capture Percentage. “Sales Per Capita” tells you how much every person walking through the door is worth to you, (on an average) regardless if he or she buys anything or not. The “Capture Percentage” will tell you what percentage of them bought something; anything. These two stats, when displayed dramatically are very powerful motivational tools. Knowing your capture percentage allows you to focus on the missed opportunities in the store rather than a lack of traffic.