In many ways, retailers are ideal clients. They are pragmatic, have reasonable expectations,
and if you provide them with a good service and support, they will buy from you again and again.
Retailers have a lot of money invested in their business and their stock and their buying decisions
with equipment and software focus on the best medium to long term return, not saving a few dollars
with inferior quality. Provided that the case you put to a retailer can be
justified using common sense, you will get a sensible response.
Retail is different from other types of business, and you need to understand those differences if you
want to do business with retailers effectively.
Theft & Fraud Detection
There is an old saying that "10% of your staff will never steal from you, 10% of your staff will always
try and steal from you, and 80% of your staff might try and steal from you if they have the opportunity."
In an office environment, the opportunities for staff to steal from you are fairly limited. In a warehouse or wholesale business,
those opportunities are limited to the type of merchandise you stock, which may or may not be easy to dispose of. In a retail business
every staff member using a Point of Sale system has the opportunity to steal cash as well as merchandise.
And then there are the shoplifting "customers".
If you run an office based or other business, you probably are aware of the risk of theft. If you are a retailer that stays in business,
then you are aware of this and on the lookout, every single day.
For retailers, features that reduce the opportunity for theft, and make it easier to detect are essential.
Adapting systems designed for an office environment with few cash transactions, to retail
with lots of cash transactions, rarely works effectively.
Systems designed for office environments are designed to enable people to do things,
change and correct mistakes and empower the user. Systems designed for retail systems are
designed to prevent the user from doing anything unauthorised, provide an audit trail that
can't be modified, and alert management to anything that might warrant further examination.
The design philosophy is quite different.
If you come from a technology background, chances are that you will talk of all the fancy features a system offers and the power,
ease and flexibility it offers enabling you to do almost anything. But if you talk in those terms to a retailer, they are probably thinking
"how do I stop staff from accessing these features?"
Fast Operation
Customers that walk into a retail shop almost always have a choice. Chances are that at some point, you have turned and walked
out of a retail shop, because the service was too slow. Even if you did wait, there is a good chance that the next time you went elsewhere
and purchased from that shop's competitor.
Retailers know this. They want customers to buy, and they want the customer to come back next time. Therefore they know that they have to
process sales quickly. And they have to process sales reliably.
Office computer systems are designed for flexibility and use input devices such as a mouse.
But each action can require multiple clicks and items to be checked, and that is far too slow in retail where there might
be 6 customers lined up waiting to be served.
In retail, the number of operations must be reduced to an absolute minimum to speed processing. A single
touch to a keyboard or touch screen, or scan with a barcode scanner is the best. With each action required the time taken and opportunity for error increases.
Some Point of Sale systems won't allow an item to be sold if the system thinks there is insufficient stock.
In a retail environment, that is unacceptable. If a customer presents an item at the check-out,
it is in stock. You take the customer's money, let them take the goods, and fix the stock entries later.
Obviously reliability is crucial. The system must be available to process a sale on demand without any problem. This is one reason why
retailers have been reluctant to give up using Cash Registers. Cash Registers may not provide much functionality, but they are reliable.
The worst thing that can happen is that they have to turn it off, and turn it back on again so downtime is minimal.
Staff Skill Levels
Retail clerks generally have lower skill levels than office staff. They work for low wages, often are temporary and staff turnover
is high. When staff don't show up for work the retailer has to find a replacement at short notice.
In an office, tasks can usually be put back to the next day. But in retail somebody must be processing sales otherwise the business
stops trading.
If a Point of Sale system requires training, this represents a major problem for the retailer
because hiring new or temporary staff is much more difficult and costly. Retailers know that if they
can't find somebody else to operate the POS at short notice, the task will inevitably fall back to them,
and they will end up working late to complete their normal work.
The sort of system that is intuitive and easy for people with an IT or accounting background is
not easy for retail sales clerks that are familiar with using a Cash Register. While you might
find a cash register operation sequence unfamiliar, the untrained clerks that are used to
a cash register and will be actually using the system, often get a mental block if
faced with a computer keyboard or a mouse.
Accounting Information
Many modern computer systems offer the promise of fully integrated accounting where everything is fully automated from each sale
up to the balance sheet. While this may be desirable for some retailers, it is of less importance than in some other types of business.
In reality, most retailers have trouble with their stock losses. If a retailer is running on 10% gross margin, then for each $200 worth
of shrinkage they have to make $2000 in extra sales just to cover the loss. Having transactions posted automatically to the balance sheet
is nice idea. But they know they have a problem with stock loss, and they know that is where they need to focus their efforts.
Fully integrated accounting first requires proper stock control, plus a lot of additional work. While it sounds fine in theory,
what they really want is simplification and less work.
Smart retailers know the value of their accountants. They look for systems that help them manage their business more effectively
and provide their accountants with the source information the accountant needs. They don't look for systems that pretend
they can replace their accountants.
Conclusion
Retail is different from wholesale or office based business. If you understand
the situations that retailers face, then dealing with them is easy. But if you uncritically
apply your assumptions about other businesses to retail, you will often find that what
you think will help, actually has the opposite effect. When dealing with retailers, look at the
situation from their perspective.
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