web site updated 3 July 2007

Your Three Retail Customers

Remember our two merchandise buyers from last month? One held out for higher profits and the other unloaded and reloaded. Another major benefit of the second approach was that there was fresh merchandise coming in to the shop throughout the year and it attracted potential customers to come in to see the new inventory. The other shop had the same stale merchandise and people stopped looking.

This concept plays right into the hands of attracting the three people that I recognize as retail customers. The first one is the person who wants the most recent products. They are willing to pay full price because wanting to be first drives them to their decisions. The second person is the one who knows what they want. They do not care if it is two years old, how much it costs or if their best friend has it, they want it. The last person is the bargain hunter and is probably the most important of them all. They buy your mistakes and allow you to reinvest. This turnover of investment is what attracts the first two customers to come back. Think of it this way, customers one and two pick the best of your inventory and the third one buys their rejects. This gives you cash flow to start the cycle anew.

I had a client several years ago that was a grand hotel resort that is home to a PGA tour event. When I suggested a permanent sale rack, the director of golf said (looking down his nose at me), “We don’t have a sale rack”. However, I convinced him of the importance of getting rid of the old merchandise (much of which was being kept in storage). I explained that at upwards of $400 a night, some of the golfers wanted a souvenir, but had spent enough on meals, rooms and golf.

I was interested to find that some resort courses in the UK and Europe do not carry much in the way of logoed shirts and, during my seminars for Premiere Golf; I suggested that they were missing out on a wonderful opportunity. A friend of mine at a resort in Northern Ireland decided to carry more of these pieces the following year and reported that she was very successful at selling these at a high margin.

I love the snob appeal of logoed merchandise from these places and believe that people want to wear the logo. It says to the golfer’s friends, “I went here and you didn’t”.