QUESTION: The talking heads seem to suggest that the economy will bounce back once a vaccine is discovered for COVID-19. As a small retail operation, how should I position myself to take full advantage of the eventual return to a possible new normal?
ANSWER: Your question is very timely. Richmond SCORE counselors Steve Spiro and Doug Carleton have just recently written the “Survival Guide for the Retailer in a Post COVID-19 Economy.”
“Estimates vary as to how long a recovery will take for consumer spending to really begin to rebound,” they say. “Caution may be one of the best ways to describe the economy going forward for the next several years. Uncertainty is an overwhelming problem. Many customers will not feel safe coming back right away.”
The following is a synopsis of the main questions the authors say you need to research, answer and plan accordingly:
- Will there be a new norm for my business? Talk with your customers, suppliers and trade organizations. What problems do they foresee, and how will they deal with them?
- Have your customer’s needs changed, and what must you do to fulfill them?
- What must I do to communicate I have created a safe environment for my customers to shop?
- If I have seasonal merchandise that’s peaked, how do I move it and make way for new offerings?
- Can I depend on my supply chain as many suppliers have folded? In addition, you must plan sales, inventory and expenses.
- Plan your sales for at least three months by dollars, units and classifications. Further break them down to weekly goals to quickly make changes if needed. Be conservative in your projections.
- Your inventory should be planned by month, based on how many weeks of sales you have on hand and on order. Try to negotiate favorable payment terms with vendors.
- Every expense should be studied in as much detail as possible. Eliminate any that do not directly or indirectly support sales.
- From a marketing standpoint, your No. 1 expense must be your online presence. Your website, Facebook and Instagram are critical tools.
Gray Poehler is a volunteer with the Richmond Chapter of SCORE, Counselors to America’s Small Business. To ask a question or request free and confidential business counseling, go to Richmond.score.org/mentors. Learn more about SCORE’s workshops on the website or by calling (804) 350-3569.