I’ve been working with retailers of all shapes and sizes for many years now and that has given me a unique insight into the challenges facing them, for this blog I’m going to focus on the small boutiques that enhance our high streets and give it the character they sorely need.
The idea behind a boutique is that they are deliberately small and focus on stocking high quality products that they know are in demand, they build up loyalty by being close to their customers and perfectly in tune with the latest fashions, they are generally a high value low volume type of business.
Due to the nature of a boutique stock management has always been somewhat unforgiving and getting it right for this type of business is more critical than for any other, after all if goods aren’t selling then will the business owner be able to discount them without damaging their brand?
The most successful boutique owners I’ve seen often under buy when it comes to the latest trends and then end up placing many follow up orders, this might sound crazy at first as shortages lead to reduced profits and disgruntled customers.
In reality what I have seen is that the continuous flow of new product lines into the business often improves repeat visits from customers who want to see what’s new and it creates a greater urgency to buy if it appears that there is limited numbers left.
This method of placing smaller orders can sound time consuming but it can be a great opportunity for owners to continuously review the latest trends and ensure that they have the most appropriate product range, it can also go a long way to minimise the risk of buying stock that doesn’t sell.
Don’t get me wrong buying in larger quantities has advantages as well like getting better prices for bulk buying and the convenience but these can be replicated for smaller orders by improving relationships with suppliers and getting them to understand the vision behind the business.
As accountants we work closely with our clients in Northampton and the surrounding areas to help them develop the systems they need to better control stock in their businesses, if you are interested in how we could help you then please get into touch.