Retail Observer

RETAILOBSERVER.COM DECEMBER 2014 52 Pat Kelly Furniture Trends Pat Kelly Assistant Vice-President, Home Furnishings Cantrex Nationwide W hen I first heard the expression "What gets measured gets done" many years ago, I was struck by the simplicity and directness of the thought. I recently attended a meeting with a group of independent furniture retailers where we discussed how to measure the effect of marketing plans and the ROI they generate. I was surprised at the range of practices employed, from tracking the dollar sales per customer (outstanding!) to no tracking whatsoever. Imagine watching your favorite sports event with no scoreboard, no time-keeping or score to determine the progress of the game? Zero interest! We love to keep score. Keeping score motivates us. Keeping the right score drives success. Furniture retailers face unique challenges in category management. Major categories like upholstery have several sub-categories related to style, fabrication and color groups. Hot-selling categories such as sectionals require immediate attention. Keeping score for each product is imperative if you want to stay fresh and on trend. Let's look at how it's done. START WITH THE BASICS A sophisticated POS system will help, but start with your sales plan: annual, monthly and daily. Then, overlay your marketing plan: flyer events, direct mail, TV, radio, web. Set your expectations as to their impact on sales. Relate this directly back to your product categories – master bedroom, upholstery, home office, etc. Ensure your plan is broken out with reference to your floor plan and product layout. Stock as many accessories as possible, such as lamps and area rugs, to raise your average ticket. Next comes the fun part. Share your high level plan with your staff and talk about setting goals. Avoid setting too many. Set one or two major milestones, then have open discussions about how to meet them. You will be amazed at how much input you will get from your staff. Your challenge is to keep them focused on one or two major numbers. Ask them for the one thing – and one thing only! – that would contribute the most to achieving your goal. Then you will have buy-in! Typically, sales will top your list. Since advertising drives sales, I look at furniture flyers and often wonder why some retailers even bother to print them. There is no excitement, no urgency. The headline might say "Clearance Event" but the pricing is the regular price. Where is the value in that? I would love to know the sales impact of those flyers! CREATE AN EVENT Create urgency with great savings stories, tax-free events, coupon events, etc. Make sure your feature item is a great draw – top-of-bed for master bedroom, complete room settings for upholstery, for example. Give your sales team every opportunity to raise its score. KEEP SCORE How many customers came through your door? You can purchase systems that track customer traffic, or you can do it manually. Track close rates. Put up a scoreboard in the office showing the close rates by salesperson. This is sure to quickly generate intense competition. Your scorecard can include many other metrics, including these: • total sales by sales person • average sale value • add-on sales (warranty programs) • sales by category or item • up-selling to premium upholstery or master bedroom sets Why not try out several to see what works best for your team? Be sure that they always apply to your goal. SHARE Keep your scoreboard current. Staff will lose interest if the information is not up to date. Staff will check it as often as you refresh it, which should be daily during a major event. Have a get-together with staff at least once a week. Feedback is critical. Walk the floor to review which styles worked, and which didn't. Your team will tell you what worked best, and what can be done to improve the next event. What gets measured gets done truly touches a nerve. We want to be successful and know how we are doing. We need to know how every sofa frame and bedroom set is selling. Providing measurements that directly affect your company's performance and establish clear expectations for your staff will put you on track for a very successful year. KEEPING SCORE TO MEASURE SUCCESS RO

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