Tag Archives: buying

Buying VII – Buying Conclusions

April 26, 2012 By in Buying, Strategy Tags: , , , Leave a comment

Cliff's Notes Buying Conclusions

We have spent the past few posts in Steve Jobs and trade show mode.  I now want to come back and conclude some thoughts on buying.  I wrote a number of posts on this topic and hope they have been helpful.  As part of my lectures and writings, I always like to leave a topic (although we never really leave any of these topics) with a number of questions to consider.  So… when developing a great buying strategy, here are some questions to think about:

  • Who are my most important vendors?
  • Do I treat buying as an afterthought or as a vital business decision?
  • Do I reorder what is selling or am I just happy I sold it?  Do I know my best-selling models/collections?
  • Do I feel my product assortment is unique or similar to others in our area?  Have I created a POINT OF VIEW with our offerings?
  • Do I map out a strategy each year or just go with the flow?
  • Do I meet with people with new product or ideas, or think “I am too busy for anything new”?
  • Do I know what my customers really want?  Have I ever asked them?
  • Does my buying team know my overall goal for the store or practice?
  • Have I developed a compensation system that will reward “good buying”?
  • What’s my CONNECTION to what I buy?  Do I believe in it? Or do I buy it because of price?  brand name? company?

These questions are designed to make you think about your specific buying strategy for your practice or retail store.  As I have said in the past, I am not here to necessarily give you a final answer, but to provide a framework and information to help you make decisions about your own strategy and find YOUR right answer.

Buying VI – The Buyer

March 8, 2012 By in Buying, Luxury, Strategy Tags: , , , Leave a comment

We have talked the past few weeks about buying tips.  As part of developing a great buying strategy and an overall luxury strategy, one should also give some thought to compensation of team members – in this case – the Buyer.

I am a big believer in incentivizing ALL team members with bonus or additional compensation if they (A) achieve their goals and (B) bring more money into the company.  My strategic consultant for our company calls this “tying compensation to desired outcome”.   This should not only focus on people in sales.  There are ways to use this strategy with people throughout a company.

I suggest implementing such a strategy with the person or people responsible for buying product.  You can make this FUN and achieve the outcome you seek.  Here are a few thoughts/ideas on ways to tie compensation to a desired buying outcome:

  1. Establish gross margin targets and for every level above the target, establish an incentive/or other reward for achievement.  This will hopefully lead to smarter buying and better overall margins.
  2. Establish your average retail for all frames sold and offer an incentive/reward if the average retails rise throughout the year. This is one of the main benefits to a luxury strategy – increased average retails without increasing actual foot traffic.
  3. If one strategy is to add new, higher priced collections to the store, develop an incentive system for finding the “right”, “successful” new collections.
  4. And the obvious no brainer – develop an incentive/reward plan for achieving higher overall sales in general.
  5. Surprise your buyer(s) with a party at the end of the year if they achieve the goals.  Simple recognition can go a LONG way!

Again, these are some easy ways to incentivize team members and make them think about the goals to achieve throughout the year.  They can be simple financial rewards in the form of additional compensation or bonus, or they can be more “fun” such as a free trip, dinner at a local restaurant, tickets to a cultural event, or a gift you know the employee would like.  The idea is to make sure the team knows the overall goal and is aware that achieving the goal will result not only in recognition, but also financial gain.

Buying V: Sunwear

March 1, 2012 By in Buying Tags: , , , , , , , Leave a comment

It’s March and springtime is around the corner which has put me in a BIG sunwear mood!  People have written hundreds of articles and advice columns on the importance of sunwear and almost all of them are right on point.  Sunwear is an essential part of any buying strategy and, of course, any luxury strategy.

Here are some top reasons to make sunwear an important part of YOUR strategy:

  • DIVERSITY – Sunwear rounds out your total frame assortment and offers more choice to your patient/consumer.
  • DON’T GIVE IT AWAY – Sunwear is EASY MONEY for you.  Consumers are buying sunwear.  It is a hot fashion accessory and gets a ton of press, especially when celebrities wear the latest trend.  You already have the consumer in your office. Don’t let them leave and give that money to another retailer.
  • POINT OF VIEW/TELL YOUR STORY – Sunwear is the HOT accessory of the moment.  Sunwear can help you in your merchandising strategy and help you develop a unique point of view in your store/practice.  When creating your point of view, sunwear is the item that will best illustrate the story you want to tell.  If you want a sports theme – you can show sport sunwear. If you want a high fashion theme, sunwear will illustrate this for you.  And of course if you want to tell a luxe story, what better way than with great luxury sunwear?
  • IMPULSE PURCHASES – Most people come to their ECP for eyeglasses.  Very few specifically come for sunwear.  As a fashion accessory, sunwear is an impulse purchase.  If you have a great selection and have developed a trusted bond with the patient/consumer, you have the inside track to sell them that great sunglass before they walk out the door.
  • MULTIPLE PAIR SALES – related to everything we have said above…  It is very hard to attract new patients/consumers to your store/practice.  The best way to increase revenue is to increase per-patient revenue.  They are already there!  Sell them that multiple pair.
  • EYE HEALTH – This is probably the MOST important reason to have a sunwear strategy.  We are in the eyecare business as well as the fashion accessory business.  We all know the importance of protecting one’s eyes from the sun’s harmful rays.  We are doing ourselves and our patients/consumers a disservice if we do not stress the importance of sunwear as it relates to health and wellness.

And visit the culture corner to see the latest books I have been reading.

Back To Strategy

February 23, 2012 By in Luxury, Strategy Tags: , , , , , , , , , , Leave a comment

We have spent the past few weeks talking about the “HOW” of a potential luxury strategy with a focus on buying.  Today, I want to go back and reinforce “WHY” luxury is so important. Here are some recent quotes from articles in The New York Times, Women’s Wear Daily, and Vision Monday – a good cross section of publications and viewpoints.

Eduardo Munoz/Reuters

The New York Times – Wednesday February 22, “High End Retailers Report Strong Profits, but Walmart Shoppers Still Struggle.”

  • The holidays turned out to be a lot brighter on the high end judged by the results of four major retailers.  While Walmart had to lower prices so aggressively that it hurt its profit, retailers focusing on higher-income customers crowed about the solid prices those shoppers paid.
  • “I think there is generally more confidence today than there was at this time last year” – Terry Lundgren, Macy’s Chairman and CEO. He added: “Bloomingdale’s business was particularly strong.  The Bloomgdale’s customer is categorized as one who’s buying more luxury product and that business was very good, and you’ve seen that from the other luxury retailers.”
  • Price cuts meant Walmart’s margin decreased by .4%
  • Saks Fifth Avenue has historically high gross margin rate performance.  Reduced promotional activity and increased full price sales led to a .7% increase in margin.  Net income in Q4 rose 48% while sales rose 7.7%.

Women’s Wear Daily – Friday February 16: “Nordstrom Gains With Rack, E-Commerce.“

  • Nordstrom sales rose 7.2% for their current fiscal year. Net income rose 11.4%.  This year, Nordstrom expects sales to increase between 4% and 6%.
  • “Regular price selling remains at historically high levels” – Blake Nordstrom, President.

Vision Monday – Friday February 17, 2012: “2012 ‘Off to Stronger Start,’ Says Optical Business Barometer from Jobson Research.“

  • “With the January 2012 Jobson Optical Business Barometer Rating, the new year appears to be off to a strong start, and continues a strong showing that began in November of 2011,” In December, the index saw a significant improvement when the Barometer rose 0.3 from November’s index of 3.5. The January 2012 and December 2011 ratings for overall optical business are the highest since March of 2011 and higher than any month in 2010.
  • The U.S. economy isn’t the only thing that seems to be strengthening and stabilizing. Numbers for the vision care industry are on an upward trajectory as well with total U.S. revenue at retail of all vision care products and services generated during the 2011 calendar year growing to $32.8 billion, representing an increase of almost 3% from 2010 when revenue hit $31.9 billion, according to VisionWatch, a research study conducted by The Vision Council.
  • Overall units for complete eyeglasses (frames and lenses) sold increased marginally, with less than 1% gains in both frame and lens sales during the year-ending period December 2011. In dollar revenue terms, there was a healthy growth of 3% for frames and 1% in the lens market. Approximately 67.1 million pairs of frames were sold during the year-ending period December 2011, worth $8.4 billion at the retail level. During the same period, approximately 75 million pairs of Rx lenses were sold, worth $9.6 billion at the retail level.
  • Dollar sales of plano (non Rx) sunglasses increased almost 5% in the year-ending period December 2011—the highest growth rate since the recession started, to close out the year at $3.4 billion for 92.2 million pairs sold. The increase is attributed entirely to rising prices in the sunglass market as the number of units sold did not change from 2010.

What does all this mean for you?  A strategy that includes luxury product will lead to increased sales, increased margins and an overall unique point of view at retail that can help you stand out from the crowded sameness of our market and retail in general.  See the Top Reasons I had printed weeks ago.  It rings very true in light of the recent news articles:

7 key reasons luxury product should be part of your overall retail strategy

  • Luxury sales are growing at a faster pace than other price point categories.
  • Luxury attracts affluent consumers – they are more loyal, they are wealthy, they are networked and thus they tell friends about you if they like you.
  • Luxury usually means local and NOT chain stores.  Americans like to shop. They like to spend money (despite the current crisis). And they like to do it locally and not in chains.  They want something special and they want it locally.  Don’t give the business away to a chain.
  • Luxury means generally higher margins on all sales
  • Luxury means higher retail price points which means greater sales volume.
  • Luxury means higher sales per patient visit/transaction –All of this means you can increase your sales without even increasing your patient base or the amount of people coming through your door.  You can increase sales without increasing any marketing or outreach expenses.  (we will discuss this in more detail in a future post)
  • Luxury product is the best way to stand out from the competition. It’s the best way to stand out from the chain stores that all look the same.  And it’s the best way to fight the ever present internet and all the discounts you can find there.   In short, luxury product is the means to creating your own point of view at retail.

Buying IV – Trade Show Season

February 3, 2012 By in Buying Tags: , , , , , , 2 Comments

Trade show season is fast coming upon us.  Mido is a few weeks away.  Vision Expo is less than 2 months away.  And there are MANY smaller regional or state sponsored shows throughout the spring selling season.

Why do we all visit trade shows? To see new products? To buy new products? To efficiently work with our current partners? To get necessary education credits? Because we have been doing it for years? An excuse to travel?

While trade shows can be challenging, as they’re expensive to attend and take away valuable time from the office/practice, they can also be very effective as part of an overall buying strategy IF planned and managed properly.  Here are a few things to consider when planning and then visiting a trade show:

  • LOOK:  Take time to walk around and actually see the trade show.  If you have wall-to-wall appointments at a show you may find you did not really feel like you attended a show….  You just had meetings that could have been held anywhere.  Try planning a half a day with NO appointments or scheduled commitments.  Just walk around and look and talk to people.  You never know what you might see or learn or who you might meet.
  • LEARN: Take some classes on topics that interest you – and always take a business/merchandising class to learn about the newest ideas and trends in the industry.
  • TALK:  Make sure to always meet new people and vendors and see new collections.  You may not have time back at the office so a trade show is a great place to make time and see that new collection you had heard about, or meet the vendor who has been calling you with an intriguing new idea or new collection.
  • OBSERVE: I hate to succumb to trade show psychology, but see what booths are busy.  There is usually a reason.  The booth may not be for you but you should at least know what “all the fuss is about”.
  • ASK:  Ask your patients and staff in advance what they feel is missing from your current offerings.
  • STUDY: In advance of a trade show, make sure to do some planning and research.  Aside from the above, make sure to set the appointments you know you need to make, make sure to research new brands or collections in advance (so you have an idea of what you want to see live and in person), and make sure to leave time for all the above ideas as well.

Is this something with which you have experience?  Please share!  Thank you.

Buying III: Trust

January 26, 2012 By in Buying, Strategy Tags: , , , , , , , Leave a comment
Buying III: Trust

How many times in business have you said: “I really do not like working with him/her or ‘that company’.”  I have heard so many doctors, buyers, and dispensers say this over the years and my response is always “Well then why work with them? There are plenty of choices out there!  It’s not like you need to work with them.”

One of the great unspoken truths in retail buying – and for that matter – business in general, is that it is always more enjoyable to work with people you trust, people you like, and people you know will treat you fairly.  There may be times you have to work with someone who does not meet these criteria, but in many cases you can always find an alternative to those who just give you the “wrong feeling”.

In our industry – and I will focus on frame buying where relationships matter and there is plenty of choice – I am a big advocate for working with those you trust and like.  This is NOT to say work exclusively with a sales representative with whom you have been friends for 20 years just because you have been friendly, but I do believe it is important to TRUST the vendors you buy from.  WHY??

In many cases, buyers purchase brands or collections they feel they need – the “hot” brand of the moment (and in most cases, the one everyone else has as well) or the brand they saw in competitors’ stores. And in many of these cases, you can feature the brand or the collection, but you do not get the added benefits of working with a true vendor partner.  I feel this is the wrong approach.  You should ALWAYS work with a true partner and not just a brand you feel you need.

You will always get more out of a product when you trust and enjoy working with the people behind the product.  They will want the product to sell through as much, if not more, than you do.

  • They will be more willing to help with in-store training and merchandising.
  • They will be more supportive in both the good and (inevitably) the bad times.
  • They will tell you the truth, rather than just trying to make a sale.
  • They will have your best interests in mind as opposed to the best interest of the company they represent.
  • In short – they will go the extra mile for YOU.

Remember – the point of view in your store/dispensary is more important than showcasing a brand you think you need.   With the right doctor/patient connection and level of trust, most consumers will buy something you suggest and you like instead of the mega brand they thought they wanted. In most cases, the luxury product will offer more value and better quality than the most famous brand names available.  And if the vendor is going to go the extra mile for you, you will be able to offer more added value to your store AND the end consumer.

As always, I welcome all comments.  Is this something with which you have experience?  Please share!  Thank you.

And lastly – GO GIANTS!!!!!

Cliff’s Notes on Buying: II

January 17, 2012 By in Buying Tags: , , , , , Leave a comment
Cliff’s Notes on Buying: II

I hope everyone is finding value in these posts.  Since buying is such a crucial element in developing a successful luxury strategy, I wanted to spend a few more posts on the topic.  Today I will share some more tips.  Hope these will also be helpful:

  • Tell a unique story.  Your product must stand out. Buy product you cannot find in every shop.  It must be different from what all of your competitors are selling.
  • TRAIN, TRAIN, TRAIN and MERCHANDISE! – Buying does not stop when product arrives in the store.  Part of great buying is making sure the staff can explain what was bought and then making sure it looks good in the store.  Most companies will work with their partners on training and merchandising to ensure that product stands out and sells through – just ask your favorite vendors!
  • REVIEW and STUDY – In order to make informed decisions, you need to know what is out in the market, what is popular, what is new, and what is special.  Visit trade shows, read trade journals, and consult the web resources for our industry.  Basically – STAY INFORMED.  The most successful retailers are constantly reviewing their assortments AND seeing new product all the time.  It doesn’t mean you have to buy new product all the time, but how can you make the most educated buying decisions without knowing all of the possibilities out there?

We have spent the last two posts on buying tips. I would welcome any comments from those in the retail world. This list is by no means exhaustive and I would like to hear about other experiences or tips you may have.  Thank you.

Cliff’s Notes on Buying

January 5, 2012 By in Buying, Eyewear Tags: , , , , , 3 Comments

We are back after the holiday season.  We want to wish everyone a happy, healthy, and successful 2012!

Before the holidays we talked about the “WHY” of luxury eyewear. We will always continue to focus on “WHY” and circle back to this in future posts.

Now, we also need to focus on “HOW”. “HOW” is about buying, selling, and marketing. And remember – I am not advocating changing your entire product mix and becoming a luxury store. I am simply saying you need to embrace luxury product as part of your overall strategy as it is the best way to help you create that point of view we all strive for.

 

  • How can we develop a specific luxury strategy and incorporate it into the overall retail strategy?
  • What tools do we need?
  • What initiatives should we undertake?

Any overall strategy must include not only GREAT product but also THE RIGHT product for the environment. And someone has to “buy it”.

This post and the next few posts will focus on BUYING.

I must admit, I have never been a retail buyer nor have I ever worked in a retail store. However, in my 20 years of experience sitting on the other side of “the table” I have seen successful buying strategies and “not so successful” buying strategies. I have worked with retail stores ranging from Wal-Mart to Neiman Marcus and everyone in between, as well as hundreds (maybe thousands) of eyecare professionals and independent retailers.  I figure that is a pretty good perspective.

Here are some TOP TIPS on buying Luxury Eyewear:

1. There is an old adage out there – its quality and NOT quantity. In this case its quality AND quantity – nothing looks worse than 6 pieces of a collection.  Buy 20 pieces at least.  Ideally, you need 36 to 50 to make something look meaningful.  Look at the most successful retailers.  They buy deep and they show they believe in brands/collections.

2. Reorder what sells – don’t be happy you sold it – support the business that sells.   The worst mistake a retailer can make is to be “happy” something sold.  In most cases (not all), the items which sell are the best sellers… you always need these to make money.  And the best sellers also help the slow movers.

3. Evaluate your assortment – make sure you have product for your different types of clientele – take into consideration the different income levels of your consumer base, the gender mix, and your consumer’s varying fashion interests. Make sure you have the right assortment that will appeal to the majority of your patients/consumers.

4. Develop a matrix so you can track what you have in your assortment and what you need to add to your current assortment.

5. Do a patient survey so you can learn….  In short, you need to know your clientele and the different tastes they have.  You don’t need every brand or collection under the sun.  If you buy properly, you can always satisfy 99% of your customers with fewer brands/collections.

To summarize, I believe in the KISS method – “keep it simple, stupid”.  Developing a luxury strategy and a buying strategy does not need to break the bank or create unnecessary anxiety.  All you need is some focus, courage, and commitment and you will very soon start to see results!

In the next post we will have MORE buying tips.  Stay tuned.

Lastly, it would not be a post without some Culture Corner updates. Check them out!

Cliff’s Notes For Strategy Development

November 3, 2011 By in Strategy Tags: , , , , , , , , , , Leave a comment

This blog is about my unique point of view of the eyewear industry.  I firmly believe that to be successful in our industry today, a retail store or dispensary must A) offer a diverse selection of product including luxury and B) must offer the consumer a unique shopping and service experience in order to distinguish themselves from all the competition from other retailers, the internet, etc. And we will talk about this in detail over the next few posts.

But before we get to the specifics of product and experience, I thought a great place to focus would be how to begin to develop your own GREAT retail strategy. The strategy should include plans for buying, selling, marketing, merchandising, motivating, incentivizing, and creating a great environment. Today I want to start with “strategy” in general.

So, what is a good strategy?

Quick Side Bar: I think any strategy development MUST start with questions. “Answers” are great;  however, it is hard to get the right answers unless you ask the right questions. I am here to make you think (and hopefully then help answer some questions). I am a member of a group called YPO, Young Presidents Organization. The group is made up of younger presidents of companies and entrepreneurs. These people don’t want to be told what to do… In the group we have a language protocol; we rarely use the phrases “you should” or “do this.” We talk from experience and ask questions.

I am not here to tell you what to do but to ask questions and make you think. You all need to own your own decisions and business strategies which means you need to develop them yourselves. If I tell you to do something, that means nothing. If you do something on your own, you certainly want it to succeed.

Back to strategy… I am obviously a big fan of asking questions as a way to phrase the issue. So for today let’s look at some real BIG PICTURE stuff. The questions you NEED to think about in order to start developing your own strategy.

Top 10 Questions To Consider When Developing Strategy

  1. What do you want to look like?
  2. Who do you want to work with?
  3.  What are your core values?
  4. How do you treat employees? What can you do to enhance their experience and help them grow?
  5. Does your product assortment currently stand for anything?
  6. What do you want to stand for and what is your point of difference in the market?
  7. What do you stand for now?
  8. What do you want consumers/patients to think of when they see your logo or store or leave your office?
  9. Why do you think consumers/patients have chosen to come to you? Have YOU ever asked?
  10. Do you listen to your staff and clientele – really LISTEN?
  11. What connection or experience do you create every day for your vendors, employees, and ultimately your  customers? And if you had to answer this for your practice in five words, what would they be? (Number 11 is for good luck!)

In my humble opinion, you can not have a sound strategy unless you are able to clearly answer all of the above questions. So take some time to really think about these questions and answers and in the next few posts we will discuss how to take the answers and use them to develop a unique strategy for your own store/dispensary.

Hope you found today’s post insightful and helpful. As always, please email me with any questions or comments. HAPPY THINKING!

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