The five principles of retail


five principles of retail - Shop sign

If you are running a retail business - whether bricks and mortar or online - there are five core principles you need to adhere to. From customer care to the four Ps, Antony Welfare, author of The Retail Handbook, explains what you need to know

1 The customer is the most important person in your business

The main retail principle to master is: the customer is king. They should be the centre of your business, and everything you do must revolve around customer needs. Knowing them, and focusing on them in everything you do, will help you grow your business and your team.

2 Retail is detail

So, you need to address and improve your understanding of your customer. To do this, every retailer must focus on the detail, and get things right the majority of the time. Mistakes are OK, but you must learn from them and don't repeat sloppy errors. Customers will allow you some mistakes, but too many will turn them away.

3 Understand the four Ps

This is a very old principle but still has validity. The four Ps - Product, Price, Place, Promotion - are the basic foundations of a successful retail business.

Product

You need products that your customers want to buy, and a product range that will satisfy your customers’ needs and desires. The products must also deliver a profit for you to have a successful business.

Price

Price must be consistent across your range and meet all requirements for your business. You need to price your product range at the correct level for the customers to be able to buy your products, and for them to gain value from them. This could mean pricing high or low - this very much depends upon your customer offering.

Place

You need to provide the right place for your customers to purchase your product, be that a physical store, a catalogue or an ecommerce website - or a combination.

Promotion

Once you have a product - at the right price, in a place where the customer can access it - you need to tell them about this and promote your business and your products.

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4 Go the extra mile for your customer

Providing great customer service starts with understanding and knowing your customer; however, knowing them is just the start of the journey. To be successful you must deliver world-class customer service - continually going the extra mile, each time delivering just a little more than the customer expects.

Doing this each time you and your team interact with your customers will win them over and make them loyal over a long period of time.

5 Location, location, location

Historically, location has been one of the most important factors in retail success, and still to this day it will have a major impact on the performance of a physical store.

The best location will be dictated by your brand and product strategies. For example, a supermarket operation needs a car park; a high-fashion store needs to be in an area that attracts customers with an interest in that world.

However, location is becoming less of an issue that it once was, due to two main factors: firstly customer flexibility - now we often travel more - and the second being the internet. The journey from retail to e-tail has been quick, and we need to embrace the changing landscape and ensure we understand its effects on our customers.

With new technologies emerging all the time, such as mobile commerce, it will continue to change opportunities in the world of retail. Can you afford to be left behind?

Written by Antony Welfare.