This is Part 9 of a 10-part series on the Start-Up Mix, which is the selection of goods a retail store orders prior to opening its doors. Why a 10-part series instead of a quick list of tips? Because as you’ll come to see, the start-up mix is pretty crucial to a store’s success in its first few months of business. And as you may able to see from looking around your town, the first few months are a pretty crucial factor in whether an indie retail shop thrives or fails.
Need Parts 1-9? See the bottom of this post for links.
Today’s small retail principle is about labor, or store staff.
This is obliquely related to a retail shop’s start-up inventory mix because I find it’s the piece most often overlooked by beginning retailers. Many of the novice shop owners I talk to make the mistake of thinking they can manage their stores on their own 95-100% of the time. While that may be true for a while, there are many good reasons to hire at least one other helper tout de suite.
Let’s look at a few reasons why indie retailers may want to hire staff sooner than they’d think:
- No matter how much of your time, energy, and attention you’re figuring your new store will require of you, it will even more all-consuming than you’re imagining. {I speak the truth. Ask any indie retailer.}
- Bringing another face or two behind the counter means you’re not your customer’s only point of contact. Get your ego out of the way and believe me: you do not want to be the only face in the store that your customers know, like, and trust! There is only so much of you to go around. Having staff allows you to pass the ball when you need to.
- Unforeseen scenarios occur every day, like two freight carrier deliveries coming at once and both truck drivers refusing to help you get the pallet off the truck while you have a store full of customers; getting sick or having an accident; family emergencies. In retail, you can’t just close indefinitely whenever you’re having a personal emergency.
So how much should a small retail store pay its staff?
Theory is that a specialty/furniture/lifestyle retail store’s payroll should come in around 10-13% of sales — including all staff and the owner.
So if your projected revenues are $300K a year, you can realistically afford to pay out $30K in pre-tax wages across all retail store employees, including yourself.
In the beginning, putting yourself on payroll — let alone your help! — may seem unrealistic. But I assure you: carefully selected, well-trained, trustworthy, engaged, and engaging staff members are worth their weight in gold to a small retail establishment. Hire carefully, fire quickly, and remember that passionate customers often make the best employees.
This wraps up our 10-Part Series on the Letters To a Young Retailer Start-Up Mix. Hope you’ve learned something of value you can take back to your own store.
Need to catch up on this series?
See Part 1 in this series on the importance of nichification in your start-up mix.
And check out Part 2 for ideas around budgeting for your start-up inventory mix.
Part 3 explores start-up inventory principles unique to online stores.
Part 4 imparts one of the cardinal rules of retail: don’t overbuy.
Part 5 tells you which seasons of inventory you should focus on for your start-up mix.
Part 6 reveals why you need to carry both high priced and lower priced merchandise.
Part 7 investigates the balance between what you love and want to sell and what your customers will actually buy.
Part 8 discusses how much merchandise you need to make the dollar figure you have in mind possible.
Part 9 divulges how often a retail store’s inventory needs to change, or ‘turn over,’ to be financially successful.
Want some one-on-one time with me concerning your own retail store? Check out my Boutique Industry services page for some ideas on how we can work together.
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