The cost of living is on the increase, and all South Africans are really feeling it. While financial analysts are predicting that this may improve, locals are not protected from paying for high fuel costs following the National Energy Regulator’s recent announcement of an 18.65% electricity tariff increase for Eskom. Add to that the financial pinch caused by a disrupted global supply chain and the reduced spending power of the general public, and you can begin to understand why retailers are worried. Fortunately, there are small and simple things that savvy retailers can do in order to tackle this cost-of-living crisis and emerge even stronger.
Get rid of dead stock
Old stock is a problem for retailers as it ties up cash which could be used somewhere else. Not only that, but old stock has a rapid depreciation and can’t compete when newer, flashier stock comes onto the market. So retailers have to make a concerted effort to dump any old or aging stock by implementing sales, offering value adds and running promotions to entice customers to take it off their hands.
Connect with your customer’s needs
The last thing you want to do is order mountains of stock if you aren’t even sure that your customer really wants it. Don’t fall into the trap of thinking you know what your customer needs and what they are able to afford. Rather make a concerted effort to understand how their needs have changed. This is a non-negotiable when it comes to making strategic merchandise decisions.
With today’s access to tech, there is no reason why you should be working hard and not smart. Tech has changed how companies do business with smart tech integrations that streamline operations in many ways, like offering consumer lending and empowering business owners to get quick access to working capital.
Another great option is by offering click-and-collect options to your operation. Here customers can buy online and simply collect in-store. This alleviates the hassle of delayed couriers and gives the customer a convenient option between e-commerce and brick-and-mortar shopping. For example, check out click and collect specialists Pargo. They integrate with any online store and can make this process simple for you and your customer.
Working in this new world
While the pandemic was a terrible time, it did force the world to very quickly get up to speed with working remotely. This has continued after the pandemic and is now saving employees time and money but using resources at home and not paying as much for petrol, which in turn gives them the opportunity to use their disposable income to stimulate the economy in other important ways. Of course, this also means that business overheads also come down when fewer company resources are being used and this in turn can be reinvested into the business.
The bottom line
The cost of living is on the increase and South Africans are tightening their proverbial belts. It’s important for retailers to implement micro strategies like these in order to strengthen their position and lessen their chances of failure. By bolstering the business from all ends, these tough times can actually make you into a stronger retailer and foster even better bonds with your customers. If you need some quick access to working capital to see you through this transition, contact Merchant Capital in 48 hours and fund your business in the next 48 hours.