Ten Secrets of Increasing Profits and Sales

– Ken Bankson, RMSA

“No store can survive without profit and no store can grow without increased profitable sales,” said Vernon J. Rossi, founder of RMSA. “Being successful first starts with a frame of mind; you must believe in and be determined to overcome anything that will prevent you from reaching your goal”.

Rossi listed his 10 secrets of increasing profits and sales for the Apparel News in early 1980, saying they are basic and elementary.

Secret #1: You Are In A Selling Business: A store’s birth, growth and death are all the end result of sales. Protect your sales through proper planning and thoughtful buying. You are servants of the public and must always serve them well.

Secret #2 Only Customers Produce Sales: Customers control your destiny. You must always be alert to their needs. You must know and practice the age-old philosophy of having the right items at the right time, at the right prices in the right amounts. A customer will only give his trade to the store who satisfies his needs and desires. A customer is the lifeblood of any store.

Secret #3 A Store Must Have an Identity: Your store represents to the public a portrait you have painted of yourself. Take a careful look at yourself through the eyes of your store. Is this what you want to be to your community? A store must have character and personality. A store must be able to generate enthusiasm with everyone that surrounds it, from customers to employees.

Secret #4 You must Learn To Buy What You Can Sell Profitably: Over buying can only result in excessive markdowns and increased costs. It could even type your store as a clearance sale store, which could make it difficult for you to develop as a fashion leader. Under buying can only result in lost sales. You could lose volume and lose your customers to your competitors.

Secret #5 Be Aware of Your Mistakes: If you have purchased too much, or the wrong styles, admit your mistakes by taking markdowns as soon as selling reflects customer resistance by a slow up of sales. A small markdown in season will move more merchandise by far than a large markdown out of season. If merchandise does not sell in season, what chance will you have selling it out of season?

Secret #6 Plan Ahead: Know and interpret your customers' future needs by planning future months sales by departments or classifications. After sales have been projected, then plan inventories, etc. Planning is the way you can intelligently figure your future buying needs, which is your open-to-buy. This can eliminate or reduce your overbuying or under buying mistakes. THINK SALES-PLAN SALES-PRODUCE SALES.

Secret #7 Operating Expenses Must Be Controlled: Every single expense must be challenged and questioned objectively. Salaries are your biggest single expense. You must know who is not producing and be strong enough to correct any selling problems, regardless of emotions. Remember – there is only 100% in 100 and after you have paid your merchandise bill, your operating expenses, and subtracted any of your stock reductions, such as markdowns, employee’s discounts, etc. the balance remaining is your profit. THINK PROFIT-PLAN PROFIT-PRODUCE PROFIT.

Secret #8 Be a Good Teacher: Know and understand every phase of your business because management is as directly responsible to its employees as they are to it. Clearly define duties and be sure they know what is expected from them and what is not expected from them. Create efficiency by improving management. Observe your customers, see what they are buying, listen to their comments and always keep training your sales force in the area of selling.

Secret #9 There Is a Right Time: Could you sell a Christmas tree December 26th? Timing of deliveries is very important; if you receive merchandise far in advance of a season, it could get old in the customers’ eyes before it becomes salable; if you receive it after the selling season begins, you are cheating yourself of lost sales. Timing is one of the most important ingredients of success and should be understood and reviewed for all phases of your store's operation from advertising to the collection of delinquent accounts.

Secret #10 Promote, Advertise and Display: Today has become a time for specialization. Wanted fashion items of today are accounting for 75% to 80% of sales. Your windows and displays are your most important silent salesmen. They show your customers what you are. Advertising, whether it is newspaper, direct mail, radio or TV, is important since it brings your store to their home. Only feature and show your most asked for items. If it does not sell in your store, it will only turn them away from your store by showing or advertising it.

As published editorially in the California Apparel News

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