How to step up your revenue game, respond to critical online views, bounce back from an underquote and more.
[h3]A New Lease, Please![/h3]
[dropcap cap=Q.][h4][b]I’d like to renegotiate the lease on my building but I’m not sure how to go about it. What do you suggest?[/b][/h4][/dropcap]
[dropcap cap=A.]We’d say if you’re in a depressed retail market, you’re in a strong bargaining position. The key is to make your landlord aware of your pain — and the suffering you could inflict on him if you were to leave. Most landlords hate to offer long-term rent reductions, so you might want to make a 20 percent or more rent abatement for 18 months your negotiating target. Other areas to aim for are expenses, especially any common area or utility payments. To increase the pressure, list a few contract releases you’d like, such as personal guarantee release or a co-tenancy clause, which lets you escape the lease if the landlord doesn’t replace the anchor in a specified period. Seek the help of a lawyer who specializes in the local commercial real estate market. He’ll know what deals landlords are offering new tenants. Finally, if you’ve never done it, measure the space of your store. Landlords will often work off their original floor plan, even though the space may have been reconfigured repeatedly. [/dropcap]
[componentheading]NAMES [/componentheading]
[h4][b]I bought a struggling store eight years ago and have turned it into a thriving business. When I took it over, I didn’t like the name (it was the previous owner’s family name) but people said it had brand value so I didn’t change it. But it still bugs me. Just how big is the downside of rebranding?[/b][/h4]
It’s big and it’s expensive, especially now that you’ve built up equity in the name. And as soon as you change it you’ll probably have to start dealing with rumors that you went out of business, says retail expert Rick Segel. The general rule is change the name only when your core business changes or the name takes on negative connotations, like the case of Ratners Group, which became Signet not long after its CEO Gerald Ratner told a business audience his company could sell its earrings so cheaply because they were “crap,” a joke that almost overnight wiped nearly $800 million off the value of the group. Segel notes there are plenty of successful companies out there with less-than-snappy corporate monikers that owe their names to their founders (Abercrombie & Fitch, Smuckers, Funk & Wagnalls). If you must change, try a phase-out. Smith’s Jewelers for example could become Smith’s High Plains Jewelers, before eventually dropping the Smith’s altogether.
[componentheading]PROMOS[/componentheading]
[h4][b]How often should I do in-store promotions?[/b][/h4]
James Porte, of the Porte Marketing Group, recommends one a quarter. “In some instances too many promotions can drain your sales staff, and depending too heavily on promotions can take away some of their punch if they are overdone.” More important than the quantity of the promotions is how well the promotion is communicated, he says. “Combining social media, telemarketing, e-mail, TV/radio and direct mail is paramount to informing consumers about what you are promoting. You can create the best promotion in the world, but if only you and your staff know about it, what good is it?”
[componentheading] CONSULTANTS [/componentheading]
[h4][b]What should I look for in a consultant?[/b][/h4]
The first thing is someone who is ready to offer a tailored program to your situation. Beware of “formula” peddlers that don’t seem all that interested in the specifics of your situation. Similarly, some consultants will claim to be able to overhaul your entire business, from the sign atop your store down to the very bottom of your bottom line. A better approach is to identify the areas you most need help with and then to look for someone who specializes in those areas, be it staff management and training, store management and finances, marketing, or store design. The other thing to remember is that once they’ve delivered their advice or program, many consultants like to move on. If it’s hands-on, day-to-day help in an area like boosting your sales performance and closing rates you need, you might be better off with a seasoned sales executive, hired on an interim basis.
[componentheading] POTSHOTS [/componentheading]
[h4][b]A smaller rival is taking potshots at us in their advertising. Should we fire back?[/b][/h4]
Marketing consultant and author Roy H. Williams says one of the basic rules of advertising is to never respond to a challenge from a competitor that is smaller than you. “Drawing attention to a smaller competitor makes them larger in the eyes of the public,” he explains. “Conversely, if someone bigger than you is foolish enough to shine their spotlight on you, dance in it.” The one exception to this rule is if the rival is peddling untruths about your business. Then you need to expose their lies and crush them.
[span class=note]This story is from the November 2010 edition of INSTORE[/span]