5 top tips for taking on chain stores from @Makeitcheaper for #IndieXmas

This guest blog was supplied by Jonathan Elliott, managing director of Make It Cheaper, a company that helps small and medium-sized businesses reduce their overheads and increase their profits. Make It Cheaper is a Gold Sponsor of the ‘Celebrate an Independent Christmas’ campaign.

A big part of our work at Make It Cheaper is advocating small and medium-sized UK businesses and engaging with the issues and challenges they face. We understand that, where independent retail is concerned, a recurring threat is posed by powerful chain stores that set up shop in the local area.

So, we’ve drawn on the experiences of the 5,600 indie retailers we’ve worked with to date and put our heads together to come up with five tips that will help you take on the big boys down the road.

Focus on your strengths and cause some mischief!

Identify the advantages you have over your big competitor and do everything you can to get them across. This is what the major brand is most likely doing by hammering home messages about its cheaper prices.

You probably have higher quality products and you should certainly be offering a more personalised, friendly service. Let the latter speak for itself – but if something needs to be pointed out explicitly, do so through displays, A-boards, packaging, talking – whatever it takes.

There may be an opportunity to cause some mischief and, in marketing terms, position your store in relation to your competitor – in a similar way to how 7-Up once famously branded itself ‘The Uncola’. Differentiate yourself by telling people all the things you’re not and all the things you are. The more you show you’re up for a fight, the more people will talk about your shop and identify with your brand’s values.

Don’t worry about being conspicuous – the big retailer already knows you’re there.

Factor in your indirect costs

Kelly Clifford, author of ‘Profit Rocket’, claims that many small businesses do not factor in their fixed costs when setting their prices. Well, you can bet your bottom dollar that your big competitor does. They will know exactly how much they need to sell in order to generate the profit they want.

In fact, this is even more important for your smaller operation because you don’t benefit from economies of scale in the same way that big stores do – which means that many of your overheads account for a much bigger percentage of your turnover than theirs.

You know what your product costs and you set a margin that gives you the profit you need to make the sale of the product attractive – but have you factored all your overheads into that equation? If not, you could find yourself short of profit even if you hit your targets – so you’ll need to increase your prices (risky) or increase your sales (tricky) to make up the shortfall.

Once you’ve understood the importance of your overheads, you can work on driving them down as low as possible. Make It Cheaper can help you achieve this with a free and impartial saving service – and remember, every pound you save effectively goes straight onto your profit figure.

Customer retention is easier than customer acquisition

When any business is faced with a threat that may result in loss of custom, the temptation is often to advertise or run promotions in an effort to acquire new customers. This can work, but it can also be very expensive – and what’s more your major competitor has a massive marketing budget that allows them to reach your potential customers much more effectively.

You’ll probably get a better return on investment by focusing on the customers you already have. Give them top quality customer service, encourage their loyalty, make them feel like stakeholders in your brand. Get this right, and these customers will become your advocates and effectively do your marketing for you.

Communicate, communicate, communicate

Your communication with customers should not be limited to the outstanding customer service you provide. You can get creative to improve the experience of being in your store, create talking points or, sometimes, encourage customers to do what you want them to do.

Think about signage. It strikes me that the majority of signage we see is either prohibitive or information-based – so when you see something that serves a different purpose it can be very compelling.

I recently saw a TV item about a London greengrocer who filled her walls with blackboards boldly displaying recipes based around fruit and veg. It looked fantastic, made a great talking point and encouraged impulse purchases. This greengrocer seized upon an opportunity to delight her customers in a way that larger retailers usually cannot.

Here’s an idea if you’ve got a great space or attractive display: try a sign that encourages people to take photographs. Every photograph taken prompts future stories whose lead character is your shop – and how many more photographs will be taken if you’re explicitly asking customers to snap away?

One more thought. At WHSmith, staff often wear shirts saying things like ‘Ask me about pre-ordering the new Harry Potter book.’ Maybe you could do something similar. Consider this: how many more turkeys would a butcher sell if he wore an apron throughout October and November saying ‘Ask me about ordering your Christmas bird’?

Get online

Another major threat to indie retailers is the rise of online shopping – but even if it’s not viable for you to go down the e-commerce route, that’s no reason to ignore the web. National brands are in the online space – and you should be too. Even if you have a simple website that shows your shop name, some gallery images, your location, your phone number and your opening hours – that’s something for your customers to share. Include a contact form and it’s also a way for customers to get in touch.

Back to those photographs I mentioned in the previous point – if people share them via social media, most will actively want to tag your shop in their posts. If you don’t have a profile, you can’t get tagged.

Some smaller companies are cautious about social media because of the threat of people posting negative content, but this is nothing to fear if 99 out of 100 comments are likely to be positive.

Huge companies are on Twitter and Facebook using the opportunity to promote and interact. Some even offer an additional customer service channel, with Tesco being a notable example. But your business is fun, personal, sociable – so the online social space is one you should be dominating.

Thanks to the team at Make it Cheaper for this guest blog and some useful tips! To find out more about how they can save you money on your bills visit www.makeitcheaper.com or call 0800 316 711.

About Clare Bailey

Clare Bailey, The Retail Champion (formerly Clare Rayner), is one of the most well-known and respected retail experts in the UK. With unrivalled knowledge in retail, high streets and consumer matters, she offers unbiased, independent content – whether engaged as a professional speaker, for broadcast media, or for a written feature. Clare is a business woman, entrepreneur and founder of several small businesses. Having been born into a family of successful business owners, it was inevitable that she’d eventually jump off the corporate treadmill and step out on her own! Today her brand portfolio includes The Retail Champion, The Retail Conference, the Future High Street Summit and the Support for Independent Retail campaign. In addition, she is co-founder of Mobaro Retail UK and a non-exec director of Beed Virtual Assistant Services. Having started her career as a fast-track store management trainee for McDonalds, she went on to work with leading retailers such as M&S, Dixons and Argos. She moved swiftly into management roles before being headhunted into senior consulting roles with global software giant SAP, and international management consulting brand, Accenture. Her corporate background in senior retail, consulting and technology roles, coupled with her experience of creating and running her own business, has enabled her to be equally capable whether consulting to global brands or micro businesses. This unique blend has not only positioned her as a leading expert in all things retail, but has enabled her to add meaningful commentary and insight to the debate around the future of the high street, and, how technology is driving fundamental change in the way consumers, and businesses, interact. Clare has become an influential voice in her field, which has resulted in her becoming a regular media contributor and sought-after conference speaker. Often seen on Good Morning Britain, BBC Breakfast, Sky News, and Chanel 5 (to name a few), Clare speaks on a myriad of retail, high street and consumer issues – but is particular adept when it comes to explaining the context behind retail trading results, newly released data, and government stats, in a palatable and informative manner. In addition to broadcast and conference speaking, Clare is the proud author of two best-selling business books published by Kogan Page - The Retail Champion: 10 Steps to Retail Success, published July 2012 and How to Sell to Retail: The Secrets of Getting Your Product to Market, published February 2013. She has provided contributions to various academic texts, including Retail Marketing Management (published by Pearson). With an engaging, conversational yet informative style, Clare writes for press and content agencies, providing features, articles, blogs and opinion pieces as well as contributions to white papers and reports. However, when the situation demands a more serious style, Clare can deliver - In 2016 she wrote an extensive report for a major insurance and risk law firm, as a retail expert witness, to support a public liability suit. She found that project particularly enjoyable as it played well to her strengths – assimilating large amounts of data and information, identifying the key points and articulating that in an understandable manner. When not on TV or speaking at conferences, Clare’s “day job” sees her supporting consumer-facing businesses through her consultancy services. When asked to describe what she most loves about retail consulting it is typically the opportunity to “dig deep”, getting “under the bonnet”, in order to leverage the business data to uncover the insights that lead to “lightbulb moments”. She also loves working on business change programmes that centre on improving the processes and systems to increase profitability by supporting more rapid, better informed decision making, improving the customer experience, or simply by become more efficient and streamlined. In this respect she considers herself a “business engineer” with a brain that works like a relational database! Due to her years of experience, her logical, objective approach, her quick, rational thinking, she is known for being able to cut through complexity, seeing right through to the crux of issues, finding creative solutions that others may have overlooked. As if all that wasn’t enough, Clare is a working mum, juggling a home life in rural Lincolnshire with her partner, their 5 kids, 4 cats, and geriatric Labrador! For all enquiries, contact Clare directly on 01727 238890 or email champion@retailchampion.co.uk.
This entry was posted in Independent Christmas, Supporting Independent Retail and tagged , , . Bookmark the permalink.

2 Responses to 5 top tips for taking on chain stores from @Makeitcheaper for #IndieXmas

  1. James C says:

    Hi Clare

    Thanks for this, I always like to think that every £1 saved is £1 extra profit (likely easier to generate too!). I have also just started a site similar to Make It Cheaper but helping companies reduce spend on the boring things like stationery, might be worth adding 🙂

    • Clare Rayner says:

      Hi James
      Sounds interesting – Make it Cheaper are one of the sponsors of the Support for Independent Retail campaign, helping us to keep going and in turn we spread the word about how they can help small businesses to save money. Like you say, £1 saved is £1 direct profit.
      If you want us to promote you then let us know and I can send you details of the sponsorships – any business that has a value-adding message is welcome as a sponsor of the campaign. Our sponsors are all really exceptional, credible brands who CARE about the independent sector as well as having something genuinely of value to offer them.

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