Achieve Turn in a Retail Business
“Turn Is Magic” because it is a reflection and result of so many activities that are happening right or happening wrong. A good turnover rate is a rate that is appropriate for whatever product, merchandise, or service you’re dealing with—that is, it generates sales and profit at a very healthy rate. Fruit would have a fast turn, Persian carpets would have a slow turn, and shoes would turn somewhere in between.
To achieve the appropriate turn in a retail business, this is what you have to do:
- Select or create the right product to begin with.
- Have it in the right quantities.
- Mark it down or throw it out if it does not sell.
- Analyze what sold and what did not.
- Then reinvest the money that you did get into more of the inventory that will sell. (One former boss used to say, “This is a very simple business. Only buy what sells.”)
Excerpted from “The Five Laws of Retail” – coming 2019.