Across retail channels, more retailers now strategically seek partnerships with consumer packaged goods (CPG) suppliers that espouse sustainable business practices to gain a competitive advantage in this crowded sector.

Retailers’ and suppliers’ sustainability efforts reflect a voluntary commitment to environmental friendliness and corporate social responsibility. Sustainability programs help retail companies ensure their products protect people and the environment, including eco-friendly raw materials, manufacturing practices, modes of transportation, and recyclable or compostable packaging. 

Making sustainable business choices can help retail companies stand out and attract the loyalty of increasingly socially conscious shoppers, as the recent studies below suggest.

Consumers desire eco-friendly choices
Consumer attitudes are changing as shoppers acknowledge the long-lasting effects of their consumption patterns on the environment. Gaining access to richer information on products and companies’ practices has made consumers more informed and willing to change their shopping habits.

For instance, consider these recent findings on sustainability in retail:

• 93% of global consumers expect more of the brands they use to support social and environmental issues¹  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018.
• 92% of consumers would choose paper-based over plastic-based packaging²  Owens, Beth. Sustainability in Retail: 4 Ways to Make Your Business More Sustainable. VendHQ. April 16, 2019.  
• 88% of consumers want product packaging to provide more information about sustainability³  Owens, Beth. Sustainability in Retail: 4 Ways to Make Your Business More Sustainable. VendHQ. April 16, 2019.  
• 73% of Millennial consumers are willing to pay more for sustainable brands⁴  Nielsen. Global Millennials: The we, more and now generation. 2016.
• 51% of Millennials check the packaging labels to ensure positive social and environmental impact⁵  Nielsen. Global Millennials: The we, more and now generation. 2016.
• 40% of U.S. consumers purchased one or more products from a socially responsible company in the past six months⁶  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018. 
• 30% of U.S. shoppers say they look at product labels for evidence of the company’s commitments⁷  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018.  

Experts estimate 68 million American adults base their purchasing decisions on their personal, social and environmental values and say they will spend up to 20% more on environmentally sound products.⁸  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018. 

Also, the trend toward sustainability is global in nature, with European consumers leading the way in demanding more from retailers and CPG suppliers. For instance, nine in 10 British consumers want all packaging to be recyclable. More than a third (36%) of Europeans – and 53% of European Millennials – already boycott brands over packaging sustainability concerns. More than two-thirds (68%) of UK shoppers say the environmental impact of a product’s packaging affects their purchase choice, rising to 77% in Germany and 81% in Spain.⁹  In numbers: The growing consumer demand for sustainable packaging. Edie Newsroom. November, 26 2018.

How sustainability impacts the CPG industry
Given the consumer-driven imperative to take sustainability seriously, more retailers now seek suppliers that can help to support their sustainability initiatives and reflect consumers’ expectations. For instance, more retailers now search for suppliers that have attained sustainability certifications, such as Rainforest Alliance Certified, Global Recycle Standard, Fair Trade Certified and LEED. In addition, many grocery retailers intentionally partner with local suppliers to shorten the supply chain and reduce their carbon footprint.

And studies show retail’s sustainability efforts are paying off. 

Brands and retailers must adapt
for the future of the planet and their businesses¹⁰
In numbers: The growing consumer demand for sustainable packaging. Edie Newsroom. November, 26 2018.

According to research from NYU Stern School of Business, sustainability-marketed products grew nearly six times faster than conventionally marketed products and more than three times faster than the overall CPG market average.¹¹  Kronthal-Sacco, Randi and Tensie Whelan. Sustainable Share Index: Research on IRI Purchasing Data (2013-2018). NYU Stern Center for Sustainable Business. March 11, 2019.

Products marketed as sustainable are driving product and category growth, as they:

• Delivered nearly $114 billion in sales across all categories in 2018, up 29% since 2013, proving there’s momentum for sustainable products
• Accounted for nearly 17% of market share in terms of dollars across all categories, up from 14% in 2013
• Delivered slightly more than half (50.1%) of CPG market growth during the five years ending in 2018 – despite accounting for only 17% of the market, proving sustainable products punch ‘above their weight.’¹²  Kronthal-Sacco, Randi and Tensie Whelan. Sustainable Share Index: Research on IRI Purchasing Data (2013-2018). NYU Stern Center for Sustainable Business. March 11, 2019.

Consumers prove they’re serious about sustainability, as products that enhance environmental sustainability and societal health generated 10% to 15% of revenue for U.S. retailers in 2015.¹³  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018. Marketing communications related to sustainability translated into sales growth of 2% for products with sustainability labelling and 5% for products with sustainability marketing programs.¹⁴  The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018.

Notably, the following types of sustainability-marketed products were most dominant, accounting for more than 18% of their category:

• Dairy: Natural cheese, milk and yogurt
• Bakery: Fresh bread
• Center store: Crackers and salty snacks
• Beverages: Bottled juices and coffee
• Paper products: Facial tissue and toilet paper¹⁵ Kronthal-Sacco, Randi and Tensie Whelan. Sustainable Share Index: Research on IRI Purchasing Data (2013-2018). NYU Stern Center for Sustainable Business. March 11, 2019.

What sustainable retail looks like

The following leading retailers and brands show what sustainability initiatives look like in retail: 

• Walmart: The retail giant announced plans to reduce the plastic waste in its private label packaging, setting a goal to make all such materials 100% recyclable, reusable or compostable by 2025.¹⁶  McDonald, Samantha. After Turning Around Walmart, Can CEO Doug McMillon Help Other US Corporations? Footwear News. September 23, 2019.  
• Target: The retailer has committed to sourcing 100% of the electricity used in its domestic operations from renewable sources by 2030. In addition, Target will ensure rooftop solar panels are installed at 500 of its locations by 2020 and reduce its supply chain’s carbon footprint.¹⁷  Wright, Beth. Target furthers renewable energy commitment. Just-Style. June 14, 2019.
• Trader Joe’s: To eliminate plastic from its stores, the grocery retailer will no longer offer single-use plastic bags, and will replace clear plastic produce bags and Styrofoam packaging with compostable alternatives.¹⁸  Locker, Melissa. Here’s how Trader Joe’s plans to cut 1M pounds of single-use plastic from its stores. Fast Company. March 11, 2019.
• Nestle, Kellogg and Danone: These CPG suppliers are among 19 companies that have created a coalition, called “One Planet Business for Biodiversity,” to focus on scaling regenerative agriculture practices, boosting cultivated biodiversity, and eliminating deforestation by protecting natural ecosystems.¹⁹  Gelski, Jeff. Nestle, Kellogg among companies forming biodiversity initiative. Food Business News. September 23, 2019.
• Procter & Gamble: Marketing for the ubiquitous Tide brand encourages consumers to save energy, specifically by using half the energy per load of laundry by washing with cold water.²⁰ The Value of Sustainability in Retail Marketing. Retail Industry Leaders Association. 2018.   

The retail landscape continues to shift in response to unrelenting consumer demand for sustainable products. Retailers can show their genuine commitment to environmental change by partnering with CPG suppliers that follow sustainable business practices. When retailers and suppliers collaborate to deliver sustainable products and business practices, consumers feel better about their purchases and businesses are poised to profit.

What steps has your company taken to support sustainability?

Unless you’ve been living under a retail rock in 2019, then you know that Halloween is right around the corner. 

According to the National Retail Federation, consumers are planning to spend $8.8 billion in 2019, and while that figure is slightly lower than last year, it is by no means chunk change. 

If you’re looking to capitalize on the holiday and capture consumer spending, we’ve put together 9 Halloween marketing ideas to help you create a spook-tacular retail store. 

The tips are split into two main categories: offline marketing and online tactics. These tips are effective on their own, but for best results, try to implement a combination of them, especially if you’re selling to both online and offline shoppers. 

In-store Halloween marketing

Let’s start with getting your brick-and-mortar store into the Halloween spirit. Take a look at the tips and examples below for inspiration on how to drive more foot traffic and sales this season:

1. Have a winning window display to draw shoppers in

Your window display always plays a huge role in driving foot traffic, so if you’re looking to attract Halloween shoppers, you need to create something that speaks to them.

How you design your display is totally up to you, but a quick tip here is to place the important products at eye level. Think about the merchandise you want people to look at or buy, and position them 4 to 5 feet from the ground.

Check out the example below, and notice that while there’s a lot of things going on, the key merchandise (i.e., the outfits) are placed at eye level.

2. Go all out on your displays

If you really want your customers to get into the Halloween spirit, your store should reflect that. Go big with your approach by incorporating classic Halloween elements in your displays. 

The retailer pictured below, for instance, placed cobwebs and pumpkins to spice up an otherwise boring display. 

Or how about this store, which decided to keep all of its Halloween decors off the ground?

3. Create a Halloween attraction

Want to go beyond displays? Create a Halloween attraction or experience for guests. Think of ways that you can immerse shoppers into the season and bring it to life in your location. 

NHC Martial Arts & Fitness, for example, set up a spooky tunnel-like display at the entrance of the studio. It was a novel way to get into the Halloween spirit and it was a hit among NHC’s younger students. 

4 …Or consider a more subdued approach

Large Halloween displays and attractions look cool, but they’re not for everyone. If you want a more subtle look for your store, you can still add small and simple seasonal elements in your shop. 

Check out the display below. Instead of having loud orange decorations, the creator decided to keep things simple by having cutouts of bats on the walls. 

 

View this post on Instagram

 

A post shared by Come and Go Vintage Hannah (@comeandgovintage) on Sep 22, 2019 at 5:30pm PDT

5. Give something to trick and treaters… and their parents

If you’re in a mall or shopping center that allows trick or treating, make it a point to participate. It doesn’t cost much to give out candy, and you can even use it as a marketing opportunity.

Lens Crafters, an eyewear retailer, did just that. Lens Crafters gave out goodie bags to trick or treaters for Halloween. The bags contained candy for the kids, but they also had treats for the parents, including free eyewear wipes and a 40% off coupon. 

The Lens Crafters team even added a business card with the store’s contact info and a booklet for parents about taking care of their kids’ eyesight.

It’s a clever move that allowed Lens Crafters to engage Halloween shoppers while promoting its business at the same time. 

Try to do something similar this season! 

Online Halloween marketing

Got your brick-and-mortar bases covered? Great! Let’s discuss some online Halloween marketing tactics you could try. 

6. Make sure your store and products can be found online. 

According to the NRF, 35% of consumers do online research for Halloween inspiration. If you’re selling seasonal merchandise — be it costumes, decorations, or candy — make sure your store is discoverable on the web. 

Consider the following:

Run local inventory ads

One way to do this is to advertise your merchandise to users who are searching for products in their area. Google’s local inventory ads offer an excellent solution for doing just that. 

Here’s how they work: When a nearby customer conducts a Google search for a product that you happen to have in a local store, Google will include that item in its search results. You just have to link your product catalog to Google, and the search engine will display your items on relevant search results. 

Have a look at the screenshot below to see Google local inventory ads in action:

On social media? Focus on Pinterest, Facebook, and Instagram

Consumers also search for inspiration on social media. And when it comes to Halloween, the top social networks are Pinterest, Facebook, and Instagram — in that order. If you’re looking to engage potential customers, be sure to keep an active presence on these sites and apps.

One brand that’s doing this well is Starbucks. Not only is the coffee company active on all these sites, but it posts tons of relevant seasonal content. Starbucks has a bunch of pumpkin-themed posts on both Pinterest and Instagram:

The same goes for Facebook, and the company even updated its cover photo for the season. 

7. Direct online users to the right place

Once you’ve attracted people to your site, you want to make sure they check out your seasonal merch. 

Make this part easy by creating a special Halloween section on your website. Then display a banner on your homepage inviting people to look at your seasonal offers. 

Here’s an example of this tip in action, care of The Home Depot. 

8. Create useful Halloween content

Constant messages of “BUY NOW” can get old, so mix things up by creating high-value content for the season. 

Create something useful and relevant to your audience. If you’re an apparel retailer, maybe you can write a Halloween costume or outfit guide. Sell home decor? Share some DIY tips. If you sell food and beverages, such as our next example, Total Wine & More, you can create recipes for Halloween.

9. Market to your email list

Last but not least is do some email marketing. Whatever you have going on in-store and online this season, see to it that your email subscribers know about it. Email them your offers and content, and always have a call-to-action of what you want them to do. 

Here’s some inspiration from Poo-poori:

Final words

Halloween may not be as big of a holiday as other events throughout the year, but it still offers a massive opportunity to drive up sales and engagement in your retail business. We hope the tips above gave you some ideas of what you can do this season.

Happy Halloween! 

 

The post Halloween Marketing: 9 Ideas to Try in Your Retail Store appeared first on Vend Retail Blog.

Having worked on a private label-focused trade publication in my previous work life, I’ve always harbored a soft spot for store brands. It warms my heart when I see consumers are increasingly turning to house brands as their preferred products.¹ https://www.foodnavigator-usa.com/Article/2019/04/11/Consumers-don-t-just-like-private-label-they-prefer-it
I cheer when I see that private label products are making national brands shake in their proverbial boots.² https://consumergoods.com/private-label-growing-cpg-crisis (Not that I don’t love you, national brands. I love all brands, national or private! But I also appreciate healthy competition.)

But what irks me is when I see headlines and news articles about how private label products are “making a comeback.”

Private label isn’t making a comeback. It never left.

I’ll be there for you

Private label products have been around since the dawn of the grocery age, and while their popularity has ebbed and flowed, they’ve been a constant staple on retailers’ shelves. Private label products haven’t actually gone anywhere, we’re just in a time space where thanks to several contributing outside factors (eg, the economy, increased quality, retail brand marketing) retailers are reacting accordingly.

Target, for example, plans on launching 2,000 new private label products over the next year under its “Good & Gather” label, which will become the flagship brand in its grocery aisles.³ https://www.forbes.com/sites/andriacheng/2019/08/20/why-targets-making-its-biggest-private-label-bet-on-grocery/#6f74f976252b

Natural Grocers recently launched a new line of pantry staples under its own brand, and Raley’s did a relaunch of its entire private label program.⁴ https://www.fooddive.com/news/shoppers-want-more-premium-private-label-products-report-says/552652/

Retail giant Walmart launched a private label skincare line, Earth to Skin, “hitching its wagon to the clean beauty movement with this line, touting no parabens, phthalates, petrolatum, mineral oil, sulfates, gluten or animal testing.”⁵ https://www.retaildive.com/news/walmart-launches-private-label-skincare-line/561679/

And these are just a few examples of retailers pumping up their private label programs lately.

So why are retailers putting such a heavy focus on private label these days? Why wouldn’t they? Is a better question. But since you asked, here are three reasons:

1. Private label is what consumers want. “Grocery items are a high-stakes battleground in which Target rivals including Walmart and Amazon are trying to drive consumers to stores or online,” writes Andria Cheng in the Forbes article. And Target CEO Brian Cornell noted that “reliable everyday traffic generated by its food, beverage and essential categories” are key performance drivers.⁶ https://www.forbes.com/sites/andriacheng/2019/08/20/why-targets-making-its-biggest-private-label-bet-on-grocery/#6f74f976252b

2. Not only do consumers want private label, they want premium private label products. A Daymon report shows that “20% of sales growth in private brands comes from products that are branded premium, trendy, or organic.”⁷ https://www.fooddive.com/news/shoppers-want-more-premium-private-label-products-report-says/552652/ And a good chunk of consumers (41%) want more private label products that are “better-for-you” and 44% want products with unique attributes.⁸ https://www.fooddive.com/news/shoppers-want-more-premium-private-label-products-report-says/552652/

3. When there are entire stores devoted primarily to private label, you can’t slack on your own-brand game. If you look at the devotion and fervor people feel for Trader Joe’s and Aldi—two stores that are stocked almost entirely their own labels—it’s easy to see how retailers can benefit when they invest in their private label programs. And to add a little more private-label-only brick and mortar competition, now Brandless is getting into the mix.⁹ https://www.forbes.com/sites/bizcarson/2019/07/31/brandless-cbd-retail-store-john-rittenhouse-new-ceo/#5c6c3b347801

So no, private label isn’t “making a comeback.” It’s just been working out, lifting weights, and getting in shape to rumble with national brands in the heavyweight ring. And it’s a match I’m eager to cheer on.

If you’re shopping around for a point of sale system, then you know that you have A LOT of options. In addition to many vendors in the market, you also have to decide on the type of POS solution to use. Should you go for an iPad POS or a system that runs on a computer? Should you go for a system that does both?

You should also consider the range of features that each POS has to offer. There are basic point of sale systems that function as cash registers and nothing more. Then there are complete point of sale systems that provide more functionality — including a sell screen, inventory management, reporting, and customer management, among other things. 

Unless you’re running a really small retail business, the best route is usually to go the complete POS system.  

Here’s why.

More features to grow your retail business

Basic point of sale systems and cash registers don’t do much else beyond ringing up sales. A comprehensive solution, on the other hand, has the capabilities that can grow your business even more. Consider the following:

Inventory management

A POS system with built-in stock control features is a very powerful thing. Point of sale solutions that come with inventory capabilities can sync your stock levels as you make sales. This makes it easier for you to track product movements, so you can make smarter decisions around purchasing and sales. 

The best in class solutions even offer inventory counting capabilities to help you stay on top of stock counts. Regularly counting your merchandise (either through cycle counting or full inventory counts) has been proven to reduce shrinkage, so it’s a must that you do it. 

Customer management

Most complete POS systems also have customer management capabilities that allow you to store shopper information and build customer profiles. Some platforms even offer loyalty features so you can reward your top patrons. 

All these features lead to higher levels of engagement, repeat purchases, and loyalty — all of which invaluable for retailers!

Sales and marketing

If you regularly run sales promotions in your store, then it’s a must to choose a POS system that can support your sales and marketing efforts. Choose a solution that makes it easy to implement offers and discounts, so you don’t have to manually slash prices or do the math. 

Reporting

Part of running a successful retail business lies in the data you have at your fingertips. Having the right insights — particularly when it comes to sales, product movement, and customer behavior — will lead to smarter decisions that positively impact your bottom line. 

That’s why it’s important to choose a POS system that can generate the reports you need. Opt for a solution that can run the following reports:

• Inventory on hand
• Product performance
• Low stock
• Sale summaries
• Sales per customer or customer group

Streamlined retail operations

When you have a basic POS or cash register, you’ll often resort to using spreadsheets or pen and paper to manage your business. And while these old fashioned tools may have worked for decades, they simply won’t cut it in today’s fast-moving retail landscape. 

If you want to keep up with modern shoppers (and your competitors) you need a powerful POS solution that gives you real-time data and process tasks quickly and efficiently. 

There’s another reason why old school systems are problematic: they’re prone to human errors. Manually taking note of inventory and sales is time-consuming and can lead to mistakes. That, in turn, puts a strain on your operations, staff, and customer experience. 

Do your business a favor and choose a complete point of sale solution that covers all your needs. That way, you can save yourself from having to do manual work and run a more efficient retail business. 

You can integrate your POS with other solutions 

Another cool thing about modern POS systems? You can easily extend their functionalities through add-ons. While a complete point of sale solution should come with most of the features you need, there are instances when you need to connect it to other solutions. 

For example, if you already have a retail management solution for your brick and mortar store but want to start selling online, you can integrate your POS with an ecommerce solution so you can sell everywhere and have revenue coming in from multiple channels. 

It’s also a good idea to integrate your POS system with your payments processor. With integrated payments, data flows smoothly from one platform to the next. This setup eliminates the need to manually key in customer and credit card information at the checkout counter. Because your POS is integrated with your payment processor, all the necessary information is ready when you initiate the process using your payment terminals.

If you decide to integrate your POS with other systems, here are a couple of best practices to keep in mind:

Use preferred add-ons – Most point of sale systems have existing integrations with other software providers. This is often the preferred way to connect two solutions because your providers have already developed the integration for you. 

Ask your vendor (or check their website) to learn about the apps that they integrate with. From there, you can evaluate if the solution is right for your business. 

Find an expert partner – You can also find a partner who can help connect your various systems. Some POS solutions have networks of existing experts who can help retailers set up their software. Consult with your vendor and see if they can recommend technology partners who can get the job done.

Get yourself a complete POS system 

While a complete point of sale system typically requires a higher investment than a basic POS, the benefits of the former far outweigh the latter. Having a POS solution that offers a wide range of features not makes it easier to run your retail business, but it also opens up opportunities to increase your bottom line. 

Advanced POS systems save you time, help you engage shoppers better, and enable you to make smarter decisions. All that leads to higher levels of efficiency, happier customers, and a healthier business overall. 

Does your point of sales system need an upgrade? Learn how Vend POS can help take your business to the next level. Watch Vend’s demo video or speak with a retail specialist about your needs. 

The post Why You Should Choose a Complete Point of Sale System for Your Retail Business appeared first on Vend Retail Blog.

In retail, inventory and sales reports hold a wealth of information. But nearly half of small businesses either don’t track their inventory, or they use a manual method to do so. 

This makes retailers susceptible to inaccurate reporting. While that may seem insignificant, when you’re using data to inform business decisions, it could be the difference between tanking and having a successful sales period.

Below, we’ll take a look at what an inventory report is, as well as how to create reports to improve your retail business.

What is an inventory report?

An inventory report is a summary of a retailer’s existing stock. It distills details like how much stock you have, which products are selling fastest, category performance, and other information about the status and performance of inventory. There are many types of inventory reports you can use, each serving its own purpose. 

Why should you generate an inventory report?

“Inventory reports are important to monitor the biggest and most expensive asset of your business,” says Elliot Walters, implementation manager at Stitch Labs. Retail businesses rely on inventory to generate revenue and profit — without it, you don’t have anything to sell.

The value of inventory reporting mainly boils down to the insight it gives retailers into their business. The industry’s top performers are data-driven, and inventory reporting metrics provide both big picture and hyper-focused views into the business. 

“Retail is an art and a science, and inventory reporting is an important piece of that science,” says Chris Guillot of Merchant Method. “They help you tell a compelling business narrative that’s backed by data. That data doesn’t have to be ‘big data’ because directional data is more informative than no data at all.”

Walters gives an example of data-driven insights in action. “Monitoring inventory shrink across months can highlight opportunities for the merchandising team to re-merchandise to prevent theft, opportunities for the operations team to catch SKU integrity errors and areas of internal theft,” he says. “With inventory reporting, one report will reveal actionables across multiple departments.” 

How to create an inventory report

Before doing anything, Juli Lassow, founder and principal of JHL Solutions, recommends asking yourself what you want to get out of the inventory report. “Outline the key performance indicators (KPIs) your organization will track,” she says. With so many metrics to consider, this will keep your reporting process focused and actionable. 

Consider your tech stack — in other words, the technology tools you use to run your business. You’ll want reliable inventory management software to speed up the process, avoid human errors, and sync data across tools. In fact, 15% of inventory distortion issues are due to software that won’t integrate. 

While you technically can use Excel spreadsheets and manual reports, modern tech like Vend’s POS system will make inventory reporting easier, more accurate, and more valuable. “Retailers with a POS system can generate reports more easily than those not tracking sales and inventory at the SKU level,” says Guillot.

Once you’re all set up, it’s time to run the data. 

1. Build your list of items

Export this from your POS, inventory management software, or another database that has the information. Include basic information like how many units you have on hand, where the units are located, which variants you have, serial and SKU numbers, price, and other basic information. The information you include will largely depend on the questions you want answered. 

2. Establish your timeframe

It’s important to pull all metrics from the same timeframe, otherwise you’ll have mismatched data and discrepancies. You might look at a year or drill down to the hour. And if you’re comparing periods, ensure you’re comparing apples to apples. In other words, if you’re looking at sales numbers for June compared to November, you’re likely going to see a big difference due to holiday shoppers. 

3. Run your reports

Then it’s time to choose which reports you’ll run and generate the numbers. Guillot recommends starting with auto-generated, or canned, reports. “POS dashboards and canned reports are a great place to start your analysis,” she says. “But keep in mind that without an enterprise reporting system or best practices to recording your inventory ownership over time, it’s rate that you’ll get an accurate look at your end-of-period (EOP) inventory.”

How often do you generate inventory reports? 

The only one-size-fits-all answer in terms of inventory reporting frequency is that you should make it a regular habit, and always do it before and after a known busy period. 

Weekly and monthly

“Leverage your POS, ecomm storefront, and inventory management solution to pull inventory reports by exporting data weekly and monthly,” recommends Walters. He also notes that it depends on what the data is and who’s using it. “Weekly and monthly reports can support different teams. For example, the merchandising and marketing team can benefit from a weekly report so that they can compare how the launch and placement of a new product affects sales of existing products.”

After busy selling seasons

Guillot describes the importance of looking at the metrics after busy selling seasons. “Generate inventory reports after every important period of business,” she says. “This often includes generating and analyzing reporting at the end of each week, month, quarter, half, and year. Reports should also be run after other significant events like the holiday season. Your sales trends are important but so is period over period growth. Think holiday 2019 vs. holiday 2018.”

Based on your business operations

Lassow recommends looking at your business operations. Do you order items daily, monthly, or at a different cadence? Inventory reports contain important insights to inform purchasing. “Given the speed of change in retail, keeping current on inventory health is essential to manage customer satisfaction and company profitability,” she says. 

Types of inventory reports to create

As we noted before, there are different types of inventory reports that you can pull. Each has its own purpose, intended audience, and insights. But it’s important to remember to tie the data together, too. 

“Inventory can’t be managed in a vacuum from other key merchandising metrics,” says Lassow. “And it can’t be handled solely by the inventory planning team.”

So, where to start? 

“First, review your auto-generated reports,” Guillot says.

A word of warning, though: “Keep in mind that without an enterprise reporting system — or best practices to recording your inventory ownership over time — it’s rare that you’ll get an accurate look at your end of period (EOP) inventory,” she says. “EOP inventory is what any size retailer needs to unlock the true value of inventory reporting.”

1. Inventory on hand

Inventory on hand reports indicate how many product units a retailer has in each store, along with their current stock value. This is essentially a measure of how much capital you have in your inventory, which helps with reordering, forecasting, budgeting, and financial planning.

2. Low stock

Retailers lose $1.75 trillion every year because of out-of-stocks, overstocks and returns. Low stock inventory reports tell you which items are running low. Considering the cost of out-of-stocks, this report is crucial. If you frequently have stockouts, customers will no longer rely on your store and will look elsewhere for their shopping needs. This helps you stay on top of low stock items and be proactive in reordering. 

Retail business development manager Tristam Eriksson and his colleagues at vape store Vapouriz regularly review their re-order levels to make sure they always have enough to meet demand.

If you’re using Vend and want an overview of how to use your inventory on hand and low stock report, we’ve put together a handy video here:

3. Product performance report

These inventory reports tell you which products are the most popular and profitable. You might look at the gap in between purchases. For example, if there was a long time between the first and last sale date, you’ll want to investigate why it’s not selling quickly. And if you have items that are flying off the shelves, you might consider biggest orders. 

Walters recommends using the sales velocity and aging inventory reports. “Having visibility on sales performance by styles can be useful for your creative team, planning, merchandising and marketing,” he says.

4. Shrink

in 2017, shrink cost retailers across the globe nearly $100 billion. In the U.S., it accounted for 1.85% of sales in retail stores. While it may seem small, those are profits that you worked hard to earn. Shrink reports can help you monitor rates over time and determine if there’s a bigger problem you need to address.

5. Benchmark comparisons

“Inventory visibility isn’t something that happens overnight,” says Walters. “It takes months to develop and refine best practices.” While industry averages are helpful, they don’t account for the nuances that each retail store faces. The best comparison you can make is a comparison against yourself. Over time, you’ll be able to establish benchmarks in your data, so you can monitor over time whether you’re meeting those standards.

“Each individual report will reveal a slice of what’s happening in your business,” Guillot says. “Triangulating the information of each of these reports over time will sharpen your analytical skills and help you manage future inventory investments.”

 

The post Inventory Reporting: What it Is and How to Use it for Your Retail Business appeared first on Vend Retail Blog.

This is a post by Abby Heugel

To say the digital evolution is arguably one of the most significant retail disruptors since credit cards made their debut in the 1950s would be an understatement. Just as credit card machines became the latest phenomenon, today an efficient POS system is an indispensable tool for any modern day brick-and-mortar retail location.

In fact, according to a recent point of sale industry report, the POS terminals market value is expected to reach $98.27 billion by 2022 — that’s a compound annual growth rate (CAGR) of 13.5 percent.

From customers demanding a more personalized experience to businesses relying on data to make smarter business decisions, a POS system is at the center of it all. It’s the intersection where business logic and real-time business transactions meet, and it’s where all the action happens. 

As a merchant, it’s essential to stay on top of the latest trends in POS technology so you can stay steps ahead of your competition. Here are five point of sale trends to watch for in the near future.

Increase in mobile payments and tablet POS

With the digital age and new technology, cash and cash registers are quickly becoming a thing of the past. Shoppers have more options than ever — from credit, debit and prepaid cards to contactless payments and making purchases via electronic apps — all of which offer a variety of advantages that cash can’t touch. Cashless payments provide speed, convenience, guaranteed payment for merchants and security and transparency for both consumers and merchants. 

In fact, 73% of shoppers say they use less cash than in the past and eight of 10 customers worldwide use a tablet, smartphone, a computer or some form of digital technology within the store as they shop. Not only that, but 82% of consumers say they first refer to their mobile devices to find out more about any purchase they’re about to make in a store.

Tech giants like Apple, Google and Samsung enable mobile payments from smartphones, providing consumers with a more convenient way to pay — and retailers should take note, as this is the wave of the future. To keep up, implement a tablet-based POS system that can accept mobile payments, traditional credit card transactions and, of course, cash — as despite it’s diminishing popularity, it’s not going away forever.

Adoptions of cloud technology

In today’s digital environment, it’s critical that retailers have their store transactions or sales data accessible quickly from their smartphone, tablet or desktop wherever they are. That’s where cloud technology comes into play, as with cloud-based solutions, the POS software, services and data are provided to the user, on-demand, from the service provider’s servers.

The biggest advantage of using a cloud-based POS solution is that retailers can do everything from easily accessing their data to upgrading their software across all the stores at the same time. Multiple stores can be updated and upgraded in just minutes, which makes doing business easier for retailers. And because cloud POS is provided as a service, new features can be developed and released by the provider quicker than was possible with a client-server POS.

A seamless personalized customer experience 

A critical factor for success in today’s highly competitive market environment is the proper and timely use of technology to enhance customer relationships and improve the quality of the customer experience — all while streamlining the daily activities of your retail establishment. 

Personalization is key, as 79% of consumers said that they will only engage with a brand if their promotional offers are customized to how they have interacted with that brand before, and in another survey, 91% of consumers said they tend to shop with businesses who are aware, can recall and give offers and suggestions relevant to them.

How does your POS system factor into this equation? 

POS capabilities aren’t limited to providing a better understanding of the financial workings of your business. They’re critical when it comes to leveraging data more efficiently and effectively across all areas of the business, including customer relationship management (CRM). Retailers that use their CRM dashboards can more effectively segment marketing and coordinate sales and promotions based on their interests and shopping habits. 

The impact of artificial intelligence

Artificial intelligence (AI) is already having a huge impact on the retail sector, with 15% of businesses currently deploying AI in their POS systems and 31% of businesses planning to implement AI within a year, according to a survey from CMO by Adobe. POS systems that employ AI can now remind businesses to fulfill an order or replenish stock, notify businesses about evolving customer behavior, alert them to new product trends, give recommendations on which customers should be re-engaged, suggest promotions to carry-out and evaluate sales trends.

AI as used with POS systems can also integrate all payment experiences, real and online — mobile apps, chat payments, Instagram/social payment, purchases from your website and payments in your store — which help to provide a seamless omnichannel shopping experience. 

Use of data and analytics 

Last but certainly not least, POS systems are evolving to provide a plethora of data and analytics that can help retailers make smarter, data-driven decisions about their business. In order to personalize and enhance the customer experience, you have to know who your customer is, and that can be done through analyzing data and analytics through your POS.

Today’s POS software should provide not only the most important business data like sales revenue or transaction volume, but also drill down into more detail. What are your peak hours so you know how to staff accordingly? Are there items that are selling better than others? Are there items sitting on the shelf for months, tying up valuable cash flow into underperforming products?

The future of POS systems will give retailers instant access to rich consumer data and robust analytics to help them carry out more intelligent, data-based business decisions. Because that data will be so readily available, you can spot comparisons and correlate trends into actionable tasks.

Looking ahead to the future

As POS technology continues to evolve —  becoming more affordable, intelligent and ingrained into core business operations — merchants will have every opportunity to create a smart retail environment that not only offers the products customers want, but also the ideal customer experience. 

The post What is the Future of Point of Sale Technologies in Retail? appeared first on Vend Retail Blog.

Promotions are almost always part of a retailer’s sales and marketing mix, and for good reason — they can drive sales and help you move inventory.

But running promos isn’t as simple as slashing prices or putting up a “SALE” sign on your window. To get the most out of them, you need to consider the type of promotions to offer as well as how to execute them.

And that’s precisely what we’ll talk about in this post. We’ve compiled the most common types of sales promotions in retail along with some handy tips to help you implement them correctly.

Let’s dive in.

Types of retail promotions

What kind of promotion would work best for your store? To help you answer that, here’s a rundown of the different types of promos in retail, and how they typically perform.

1. Percentage discounts

The percentage off deal (e.g. “20% off” or “50% off”) is one of the most popular — and effective — types of promotions.

“Hands-down, the most popular style offer is n% off anything,” says Mike Catania, Chief Technology Officer of PromotionCode.org. “We’ve tracked coupon and offer usage over tens of millions of promotions for the past nine years, so we have a solid understanding of what types of deals convert the best.”

As for how to implement this offer, Mike says that storewide percentage discounts typically work best. “5% storewide, with few exceptions, will garner more attention and generate more sales than even a 60% off clearance, the next-best option.”

Krista Fabregas, a retail analyst at FitSmallBusiness.com, is also a fan of percentage discounts and says that they produce one of the highest conversions for discount promotions.

“Percent-off sales are fairly simple to profit-test, too. If net profit numbers don’t hold for a 20% discount, we move it to 15% off and still sell more than if we offered a flat amount, like “$5 off.” Oddly, even if “$5 off” has the greater savings after doing the math, the percent-promotion tends to convert better.”

2. “xx dollars off”

An alternative to “percent-off” deals, this promotion involves discounting items by a flat dollar amount (e.g., $5 off or $20 off).

It’s difficult to tell whether this offer is better than percentage discounts, as studies and tests have shown mixed results.

Krista at FitSmallBusiness found that percentage discounts typically outperform dollar amount deals. However, Craig Simpson at Entrepreneur cites a study which found that a $50 off coupon beat a 15% off promo.

This tells us that the “right” answer depends on your price points, customers, and the perceived value of your offer.

As Craig writes, what matters to your customers is “their initial impression of what sounds like a good deal.” He proceeds to give the following examples (emphasis added):

Let’s say your product is something fairly inexpensive, like a supplement that regularly sells for $25 for a bottle that contains a one-month supply. I would predict that an offer for 40% off would do much better than an offer of $10 off, even though the actual value of the two offers is equivalent.

For a more expensive product, perhaps a piece of exercise equipment that normally sells for $350, I would predict that an offer of $50 off would do better than an offer of 15% off – even though the 15% offer is actually slightly better. The $50 offer sounds like a substantial amount of money. And for most people, figuring what 15% of $350 is may seem like too much work.

If you’re on the fence between a percentage or a dollar amount discount, we recommend that you do the math AND look at your promotion from a psychological standpoint so you can figure out the best type to implement.

3. BOGO

Buy One Get One (BOGO) is another common one. This promotion can be applied in two ways: There’s buy one get one free or buy one get the 2nd item % off.

BOGO is typically used to move inventory, so if you’re sitting on a lot of stock that you want to clear out, this promotion could be a good option.

As for consumer response? Krista says that “BOGOs can be iffy for conversions, especially online.”

“BOGO-half-off deals can frustrate customers since the deal always discounts the lower of the two prices. So, in BOGO-half-off, we tend to see lower revenues due to customers searching out the cheaper items for the BOGO pairings. BOGO-free converts better than the BOGO-half-off.”

4. Multi-buys

Multi-buy promotions (i.e., “2 for the price of 1”) is another good option if you want to clear your inventory. But the success of multi-buys largely depends on the types of products you sell.

As Krista puts it, “when considering a multiples-type promotion, first consider whether the product is normally used as a set or is a near-commodity, like socks or wine. There, multiples discounts can work. Otherwise, they don’t.

For example, “Buy 2 Get 1 Free Bottle of Wine” is a winner. “Buy 2 Get One Free Ottoman?” Not going to move much.”

A great example of multi-buys in action comes from Beloved Shirts. In the email below, you’ll see that they’re running two types of offers: “Buy 2 and get 1 50% off” and “Buy 3 to get the 1 item free.”

5. Multi-save and conditional promotions

Multi-save promotions include offerings like:

• Buy and save off the entire sale.
• Spend and save off the entire sale.
• Buy and save off specific items.
• Spend and save off specific items.
• Buy and pay a fixed price.

Conditional promotions, on the other hand, include:

• Buy and get one or more items for free or on discount.
• Spend and get one or more items for free or on discount.
• Buy and earn loyalty.
• Spend and earn loyalty.

These types of promotions encourage sales without necessarily killing your revenues or basket values. They also encourage shoppers to check out more products, versus just looking at what’s on clearance. 

6. Free shipping

If you’re running an ecommerce site (and you totally should), free shipping might be a good promo for you.

Just remember that like most promotions, the effectiveness of free shipping isn’t set in stone. Some businesses find it really effective. “Free shipping always drives the most conversions, and that’s the coupon usage we’ve seen the most,” says Krista

Others, not so much. Mike at PromotionCode.org considers free shipping as “a bit of wildcard.”

“Free shipping offers have the lowest rate of success (as reported by our community) but the highest number of use attempts,” he says. “There are several reasons for this but a substantial one is when the offer is shared, the person sharing the offer had a qualified order and subsequent users did not. Merchants could avoid this confusion by either making blanket policies or by explicitly attaching the conditions of the offer itself.”

For example, instead of offering free shipping on select orders, Mike says it’s better to offer free shipping on, say, all $100 purchases because the latter is easier to understand.

7. Try before you buy

This promotion is becoming increasingly popular among ecommerce merchants. Online sellers know that the #1 barrier to conversions is the fact that people can’t touch and feel the products before purchasing. To address this, more and more ecommerce retailers are implementing “try before you buy” initiatives. 

Try before you buy is exactly what it sounds like. It lets customers ship a product to their home (typically they only pay for shipping costs) so they try on or see the product in action. Shoppers are given a specific trial period (ranging from a couple of weeks to a month) and if they don’t return the item back to the seller, they will be charged for the full amount. 

If you’re an online retailer, try before you buy could be a worthwhile effort. Yes, the offer does come with risks. There’s a chance that too many people return the product and you’re stuck with used merchandise that you can’t sell. That’s why this offer is best used on products that have an extremely high satisfaction rating. If customers are truly happy with your merchandise, they will be more likely to keep it.

The cosmetics brand IL MAKIAGE is an excellent example of a company implementing try before you buy. To increase the likelihood of customers loving the product, IL MAKIAGE invites shoppers to take a quiz to find the right type of foundation for their skin.

Once they have the perfect match, shoppers can select the “try before you buy” option, and they’re given 14 days to try the product for themselves. If they don’t love their purchase, they can send it back before the 14 days are up. If they’re happy with it, they can keep the foundation and IL MAKIAGE will charge them for the full amount.

 

How to decide on the right promotion

We talked about the different kinds of sales promotions you could offer. Now let’s discuss the steps you can take to select the right one for your business.

Be crystal clear with your objectives

The first question you should ask when considering promotions isn’t “What type of promo should I offer?” Rather, it should be, “What do I want to achieve?”

Start by identifying your objectives. Do you want to increase foot traffic? Boost your bottom line? Are you trying to make room for new inventory? The answer will help you decide on the right promotion.

If you want to draw people into your store, for example, then an attractive discount might be the way to go. On the other hand, if your goal is to move inventory, then you should look into BOGO or multi-buy promotions.

Test, test, test

Another way to figure out which promo is the best? Test different types to see what works best for your store. That’s what Gary Nealon, President of RTA Cabinet Store, did when trying to decide on what promotion to offer.

“We surveyed our audience when we were thinking about shifting to a free shipping model, and we found that a “lowest price guarantee” was more important than the free shipping for our niche because people expected there to be a cost associated with shipping big products.”

Should restrictions apply?

Generally, blanket promotions that are easy to understand (e.g., “50% entire store) are a lot more enticing. However, if you’re trying to protect your profits or want to avoid people taking advantage of your offers, it may behoove you to set restrictions such as:

• Product-specific promotions – The promo only applies to certain products or categories (e.g. “Half-off all dresses”)
• Spending thresholds – The promotion will only apply if the customer spends above a set dollar amount (e.g., “Free shipping if you spend $100 or more”)
• Customer-specific promotions – The offer is only extended to a certain shopper segment (e.g., “10% off coupon for all NEW customers”)

If it makes sense for your promotion, see if you can apply any of these restrictions. Just note that the more hoops people have to jump through, the less likely that they will make a purchase.

How to improve the performance of your sales promotions

Promotions need to be… well, promoted. Here are some pointers for enticing people to buy:

Bring about a sense of urgency

Avoid setting promotions with no end date, as this will cause people to dilly-dally. It’s best to implement limited-time offers to encourage customers to get a move on.

This is one of the reasons why flash sales are so effective. Shoppers know that the promo won’t last long, so they act quickly. Studies have shown that 50% of flash sale purchases happen in the first hour.

For best results, add countdowns telling people how much (or little) time they have left to take advantage of your offer. Check out what Habitat did in its store below. In addition to the standard “Sale” signs, they also had “Last 2 days” signage to further drive a sense of urgency.

Have a theme

Create your offers around a specific theme. Doing so will make it easier for people to grasp and remember your promotion.

An easy way to do this is to piggyback on holidays. Mother’s Day, Memorial Day, Labor Day, and the like can always be used as themes. You should also consider piggybacking on “unofficial” holidays.

For example, on National Pound Cake Day, (March 4) BirchboxMan ran a promotion to entice people to “gift” a Birchbox subscription.

See if you can do something similar to your promotions. Find a holiday — even an unofficial one — that relates to your business and use it as a hook to draw people in.

Tie in your loyalty program

Got a loyalty program? See if you could make it work with your promotion. If you play your cards right, you could drive member signups and sales. 

Why not offer a “Welcome” discount to entice new members? That’s what Gymboree does for shoppers who sign up for their rewards program. Check out their coupon below.

Or, if you’re looking to encourage spending among existing members, why not run an exclusive promo just for your loyal customers? Turn it into an event. Your loyal patrons will love the exclusivity, and you could gain a lot of sales out of it.

You could also implement conditional promotions that are loyalty-specific. For instance, why not award extra loyalty points to shoppers who purchase specific items or spend a certain amount? Such promotions encourage spending while rewarding loyal customers at same time (win-win!)

Combine promotions

If you’re feeling particularly generous (or if you really need to liquidate your stock), consider combining different promotions. Initiatives like “Take an additional 20% off already discounted items” can really grab shopper attention.

If you’re selling online, try combining discount or BOGO offers with free shipping and see how your customers respond.

Implement targeted offers

It’s best to target your promotions towards specific customer groups. Consider creating customer segments according to gender, age group, or spending habits.

For example, if you want to run a sale for a specific brand or designer, you could create a group consisting of people who purchased that brand in the past, then run a promotion specifically for those customers. Or, let’s say you have a group for your VIPs or top spenders. Why not send a special offer just for them?

Check out this example from Tiny Prints. The company ran a private sale for its VIP customers, and they sent a special email code to a select group of customers.

Be flexible with payments

Even with amazing promotions, your customers might still face hesitation when making a purchase — particularly if you’re selling high-end merchandise. For these cases, try to find ways to make shopping at your store more “budget-friendly.”

You can do this through flexible payment options such as lay-away, in which you take a deposit from the customer for a product, then set it aside until the shopper pays it off at a later day.

Not a fan of lay-away? Consider using a solution like Afterpay, a “buy now pay later” solution that allows you to receive payment for purchased items upfront while letting your customers pay in four fortnightly installments. It’s interest-free and when paid on time there are no extra costs for your customers.

Doing so not only increases conversions, but it also entices your customers to spend more. We’ve found that solutions like Afterpay can boost basket size by up to 20%.

Final words

There are no hard and fast rules when it comes to promotions. The “right” one will depend on several factors, including your products, customers, and price points.

The key is to come up with an offer that has a high perceived value while not overeating of your profits. It’s a tricky balance, but when you pull it off, you’ll see the results in your bottom line.

Now, we’d like to hear from you. What’s your favorite type of promotion? Let us know in the comments.

The post 7 Types of Sales Promotions in Retail (and How to Implement Them) appeared first on Vend Retail Blog.