How Much Is A Customer Worth? - Part 2

On 17th March we posted about the trader who had decided to give a free gift to customers to thank them for shopping at his stall. This followed a quote by a US retail commentator who said, if we value foot traffic so highly, why don't we reward customers who visit our shops.

Our trader has reported a good response from customers and, although he has yet to assess the impact on sales, the initial economics look OK. The giveaway costs 60c and is given for sales of $10 or more. At the bottom end ($10) the gift takes around 10% of gross profit while at the average sale ($29) it represents around 3-4% of gross profit. 

The gift is presented as a "Thank you for your business" and all customers have responded very well. Many are surprised to receive a gift and openly express appreciation. This trader doesn't discount his displayed prices so the gift is a useful softener for customers seeking a discount. The jury is still out on whether the gift increases sales but this trader sees it as a useful adjunct to his merchandising program and he likes the idea of a smile at the end of every sale.

The idea may be useful to other traders.

Cheap Market Research for Traders

One of the many gems of information that came from The Visual Merchandising Workshop was doing your own market research. How? - just ask your customers.
Simple questions like - 
      "What brings you to our stall today?",
      "Did we meet all your expectations?",
      "Why are you in the city today?",
      "May I ask where you come from?" 
- will give you valuable insight into the source and motivation of your customers and help your decision making on product ranges, presentation and a whole range of customer related issues.
You will find that the majority of customers respond well to your show of interest so you gain from better customer relations and a better understanding of how customers view your business.

Welcome To New Traders

 Welcome to new traders, Jeremi & Lynne with a range of quality, affordable SE Asian homewares at import prices. Jeremi and Lynne see the market as a perfect adjunct to their online business and an opportunity to gain valuable face to face customer feedback.

This is quite a change from their previous role as restaurateurs and they are enjoying all aspects of market life, particularly the friendly communication with other traders.

Market Interview - Pete the Cleaner

 Few market employees have the broad social impact of our sport guru, humorist, and good all round guy Peter. Here is his mini interview.

How long have you been at the market? - "16 years."

What do you like best about the market? " The atmosphere created by so many different people."

Worst moment? (Ed - Peter says it is unprintable and we agree)

Past jobs? "18 years in a supermarket and 2 years at Crown."

Sporting interests? "All sports including 2 flies climbing up a wall."

If you were CEO for a day? "I'd give free rent to all traders."

How many times will you sing the Carlton Football Club team song this year - "16"

One thing nobody knows about you? "Nothing. They know all about me in here."

Favorite food? "Roast lamb."

Favorite drink? "Anything and everything."

Favorite TV show? "2 1/2 Men."

Thanks Pete.

Unfair Trading Practices By Suppliers.

Traders have reported unfair practices by some suppliers in restricting availability of products simply because they are to be sold at the Queen Victoria Market. Another practice is to require adherence to recommended prices. Similar problems have been reported online.

Ebay has recently reported that 35% of merchants said manufacturers and suppliers tried to prevent them from selling their goods on the internet while 25% were required to sell at or around particular recommended retail prices. Ebay are hoping that publicity will encourage suppliers to relax these unfair conditions.

Maybe a joint effort by traders and the QVM including direct approaches to suppliers, publicity, or “outing” the supplier is an option. We would be interested in hearing from traders who are affected. Confidentiality is assured.

You know you are in for a bad day when........

We market traders can be a superstitious lot and there are certain omens that seem to set the tone for the trading day. You know you are in for a bad day when............................

                You leave your cash float on the hall table.

                Your storage box has mysteriously migrated to a spot 3 aisles away.

                Your first customer asks for a refund.

                Every customer seems to ask “Will you be here tomorrow?”

                You finally get a big sale and the customer can’t remember their debit card pin number.

                Your competitor has your best selling line at half price.

                Your lunch is delivered and you have to ask for credit.

                Your box hire bill arrives and you have to get a bank loan.

                You get out of bed, have a shower, load the van, head off for the market, and realise its Wednesday.

Aaah Yes! ..........the joys of market trading.

Please add your bad day stories via the Comments link below.

Walmart Got It Wrong!

It appears that even one of the worlds biggest retailers has misread the current economic climate. Walmart have admitted that their attempt to broaden their appeal to customers has failed.(see link below)

There is little doubt that the Global Finacial Crisis has started a shift in consumer sentiment that has far-reaching and unpredictable repercussions. As one of our traders said today -  "The positive side is that change brings opportunity. If the Queen Victoria Market and General Merchandise Traders can successfully adjust to the new consumerism then we can all benefit. It is a real challenge."

http://www.insideretailing.com.au/Latest/tabid/53/ID/10326/Walmart-chief-We-got-it-wrong.aspx

How Much Is A Customer Worth?

At the Queen Victoria Market we are constantly in a battle for customers. We are battling with our competitors within the market and outside the market, including online outlets. Statistics show that we have a distinct advantage over online retailers. Physical shops convert around 20% of foot traffic to sales, whilst online retailers only convert 3-5%.

An entrepreneur in the US named Cyriac Roeding asked; “if foot traffic is so important, why does no-one ever reward anyone for visiting a store?” Think about that. It is not clear what reward he is talking about but why shouldn’t we reward all our customers with a small gift that says “thank for not going online - thank you for not going to our competitors – please come back again”. One of our traders is taking Roeding’s question literally and offering a small gift to all customers who spend more than $10. We’ll keep you informed of the response.

Our Japanese Friends

               We are not a news site, and in fact have a very focussed audience so we have no obligation to comment on world matters. However we are part of a tourist oriented organisation and we have all served Japanese tourists as part of our day to day activities so, how do we ignore the plight experienced by all of Japan as a result of the recent eathquake.

                Our sympathies and best wishes go to all our Japanese friends with hope for a speedy resolution to all their difficulties and a safe, healthy future.

Editorial - Tough Times for Traders

                Press reports over recent months have made it clear that traders at The Queen Victoria Market are not the only ones suffering under current economic conditions. Retailers across the country are experiencing reduced income as consumers switch from discretionary spending to saving and reducing debt. Major retailers like Borders are dropping around us and even the biggest retailers are reporting significantly reduced sales.

                Things are not likely to improve quickly. Best estimates in the last month suggest retail purchases in Australia will increase by 3% over 2011 (Deloitte Access Economics report). That is simply not enough for many of us. So what is the answer?

We need to get a bigger piece of the pie. We are in direct competition with every other retailer in Australia and online. To get a bigger piece of the pie we need to get more customers through the upper market (the General Merchandise heartland) and we need to get more from each of those customers. The first part is up to QVM management. Your trader representatives will be contacting management over coming weeks to discuss a range of measures to increase customer flow. We welcome your ideas.

The second part is up to traders as you improve the way you do business, the way you treat your customers, and the way you present your unique business to maximise its appeal to customers. Getting customers to the upper market won’t help if they don’t like what they see. Training courses like the recent Visual Merchandising Workshop will help achieve improvement. If your stall presentation is untidy, if your display is unimaginative, if your signage and ticketing is unprofessional, if your staff spend more time looking at their mobile phones than at customers, you need to make changes. Yes, improving customer flow past our stalls is the major issue for traders, but we can’t ignore all those other issues if we want a bigger piece of the pie.

We welcome your input, your comments, and your ideas as we all work to improving business for General Merchandise Traders.

Australian Toy Awards 2011

Toy traders will be interested in the latest toys to win the 2011 industry awards. Full article here - http://www.insideretailing.com.au/Latest/tabid/53/ID/10258/Australian-Toy-Awards-the-2011-winners.aspx

New EFTPOS Fees Coming

Banks will be introducing a new fee on EFTPOS transactions of $15 or more. The 5c fee is payable by traders and will be introduced in October 2011. We could give you the reasons for the increase but it is in bank gobbledigook speech so perhaps you could read the article here - http://www.insideretailing.com.au/Latest/tabid/53/ID/10237/New-Eftpos-fees-announced.aspx

Welcome!

If you are reading this blog you are probably a General Merchandise Trader at the Queen Victoria Market........ and that is good, because you are our target audience.

                This blog is intended to inform traders on a range of important issues that affect your business, provide an avenue for discussion, a way of expressing your views, and, hopefully, entertain you along the way.

                Communicating with hundreds of individual businesses is not easy and it is hoped that this blog and its associated Facebook page will help us become more informed, more professional, and more financially viable as together we tackle the issues of retail trading at Melbourne’s iconic market destination.

                There are two parts to our online presence. Our Facebook page will provide an avenue for speedy social networking (or in our case, business networking) and is the perfect place to read what is happening around the market. Facebook allows information to be spread quickly and allows immediate response by readers. You can inform fellow traders of issues that affect your business, of social news around the market, or just things you want to get off your chest. You might want to ask the best place to buy cloths for your market tables, what computer program is recommended for printing the signs around your stall, or where is the best place to buy packaging tape. Pretty much anything can be discussed over this network.

                The second part is this General Merchandise Traders Blog . The Blog will mirror many of the issues discussed on Facebook but will allow more in depth information on key issues – for example discussions with QVM management on issues affecting traders, visual merchandising techniques, advertising programs, equipment reviews. There will be links to retail articles from professional sites like Inside Retailing and Retail Biz. The aim is that many of the issues that affect your daily business will be available in one place.

                That’s enough! ............. We don’t want to bore you with too much information. We do recommend you join both our Facebook page (see below) and our Blog, and come along for the ride. We think it will be useful, interesting, and fun.

Trader Contacts – John Magno, Ivano, Greg Smith.

http://www.facebook.com/pages/General-Merchandise-Traders/203923742953691