Monday, July 27, 2009

Saving it up.

Sales this last week were much better than the week before -- but, you know? Just about anything would've been better than the week before. We were way over projections in the first ten days, by more than 30%. I got a little carried away, and restocked.

I then dropped like a rock for the next ten days, by the same 30%. That's a HUGE swing, folks. So huge, that it becomes an inexplicable statistical aberration. Especially since I end up back at average!

Over the last week or so, I've been just a tad over projections.

As I said last week, it was going to take a dramatic change in trajectory for me to change my mind about the budget -- and "a tad over" ain't it.

Anything I order this week or next will show up around mid-August, giving me just a couple of weeks selling period, as well as coming due very close to the following slow period. Plus -- it probably won't make any difference in overall sales.

This is one of the counter-intuitive things that took me many years to learn. When I first bought the store, I did the common sense thing by ordering tons of stuff for summer and Christmas, and then cutting back in the off season. Makes sense, right?

Wrong.

I'm going to sell stuff in the summer and Christmas no matter what I do, and what I order actually matters less, not more. I may miss the occasional individual sale by not having something in stock, but I probably won't harm the 'overall' sales.

Whereas, being of sparse inventory in the off season is just deadly, because those individual sales may be all I'll get.

In the busy seasons, I am getting a lot more customers in the door, and to most of them everything I have is 'new'. At least 'new' to them.

I've learned to let August and December take care of themselves. I prepare all year, in a way, for those months. A bunch of last minute ordering is just money spent.

Better to save it up. Then, in the first week of September and the first week of January, look at what sold, decide what parts of the store need to be replenished, and which can be laid to rest.

At this point in the summer, I'd just be second-guessing myself. I may very well get to the 10th of August, and find out I should have ordered more of this or that, and I may whack myself to the side of the head for not knowing that -- but IT'S TOO LATE! Anything I order on the 10th, will probably show up around the 17th and come due on Sept. 1, around the time business drops. And it will be too late to affect the lost sales, anyway....

In the off season, I'll get more of the truly interested, who have probably already seen everything I've got, and who want individual and/or new and fresh material to keep them happy. It's much easier to firm up the different categories, especially if I have Summer or Christmas cash to do so.

It's a delayed gratification thing, really. I usually believe that if I'm going to spend money on inventory, it's better to do so early than late, to give myself a chance to sell the stuff. Put the money to work, so to speak.

August and December are the two exceptions to that rule, and it takes a great deal of willpower to break the pattern. I just have to remind myself how much fun it is to have a viable budget to spend in the off season and how much more it matters.

7 comments:

RDC said...

Duncan,

Here is an article you might find interesting. Especially the final paragraph which I will quote below.


Main Street's Sour Loans Surge

http://www.cnbc.com/id/32166590


"I just couldn't make any payments. I was barely making rent or payroll," owner Chris Sakelarios said on a recent afternoon when her cafe stood empty except for two patrons who read as they sipped coffee. "The same as everyone else. We're in a hovering pattern."




Sakelarios, a breast cancer survivor without health insurance, tries to stay optimistic. "Anytime anyone asks me how it's going, I say the same thing. It's going really good."

Duncan McGeary said...

I know.

I think people think I'm showing weakness by saying I'm 20% down for the year.

I think it's showing strength. First, that is completely manageable number.

Secondly, it's a lower number than I think most are going through.

Third, I could cover it up easily enough by talking about "Projection" or "Averages" (which I do to some extent as to not be relentless.)

But, I can't tell you the number of times a store keeper has told me they are "going really good" only to see them fold.

Or have customers tell me another store is "going really good," and be surprised when they fold.

Duncan McGeary said...

I made the choice of keeping the store at the same level of service and selection as the boom times, but without the full-time employee.

It's a one man operation even at the busiest. When I start taking days off this winter, it will be just fine.

blackdog said...

Purely anecdotal evidence, which as you know I don't put much stock in, but I was in Fred Meyer this morning and have never seen the place so crowded except right before a holiday weekend. Normally at 10 am on a Monday the only folks in the store are old geezers (like me) getting their shopping out of the way during the non-busy part of the week. Today the place was crammed with families with kids pushing big shopping carts stuffed to the brim -- vacationers, obviously.

This suggests two possibilities, one good, one bad. The good one: Visitor numbers this summer might not be as dismal as many feared. The bad one: The visitors are camping or staying in RVs or friends' homes, doing their own cooking, and won't be patronizing local restaurants much.

Duncan McGeary said...

I think I've mentioned, the customer count is pretty high. It seems almost higher than usual.

blackdog said...

"Sakelarios, a breast cancer survivor without health insurance, tries to stay optimistic. "Anytime anyone asks me how it's going, I say the same thing. It's going really good."

This is not being optimistic; it is being delusional.

Once -- just ONCE -- I would like to read a story like this in which the guy says, "How's it going? You really wanna know how it's going? I'll tellya how it's going. It frickin' SUCKS, that's how it's going."

Duncan McGeary said...

"... The visitors are camping or staying in RVs or friends' homes, doing their own cooking, and won't be patronizing local restaurants much."

I do think this is exactly what is happening....