Bill Stuart is CEO of Stuart & Associates, a retail consulting firm specializing in Sales and Margin Growth Programs and Returns Reduction Programs.
Wake Up: Returns are YOUR fault, NOT the customers
My friend had a cat that peed all over the house and it smelled terrible! I thought what a disgusting cat. Hey wait a minute , it wasn’t the cats fault it was my friends, he never took the initiative to learn how to change the behavior of the cat.
How can you blame customers for returns when you have not done everything possible to change the behaviors of not only your customers but of the MGT. In your own company.
If you think you have a handle on REDUCING returns (which I know you don’t), take just 3 min. And honestly answer these questions based upon your own knowledge and without doing any research and without asking anyone else for answers.
1. What were your company’s return rates the last 3 years? 2018 ____ 2017_____ 2016 _____
2. What were the dollars of returns for those same years? 2018 ____ 2017_____ 2016 _____
Check off the people, from the list below, in your company that would know just 25% of this information off the top of their head:
RETAILER: CEO, CFO, SVP sales, SVP Store Operations, VP online sales, Marketing, Buyers, Regional VP, DM, SM, ASM, Dept. Mgr., Sales assoc., Customer service associate, Cashier, Repair center, Shipping and receiving
MANUFACTURER: CEO, CFO , SVP sales, Divisional of sales, VP of Online Sales, Marketing, Product development, Product Design, Call center , Customer service, Technical support, Packaging, Logistics
(At your next executive meeting ask the people in attendance those two questions. This will open a lot of eyes and minds.)
3. On a scale of 1-10 ( 10 being best) rate each of the following:
A) Level of communication about return rates and dollars between all of the positions listed above? ________
B) You hold a Returns Reduction mtg. With all the positions listed above attending to address solutions? ______
C) You hold regularly scheduled Returns Reduction mtgs with each of the the individuals / individual groups listed above? _____
D) YOU have a written strategy for reducing returns? ______
E) YOU have set returns goals just as you do for sales? ______
F) YOU shop your website/store to see how it is helping to create returns? ______
G) YOU shop your competitors website/stores to see what they do to reduce returns? _____
H) YOU’ve used your online chat or tech support line, as a customer, to determine what can be changed to better reduce returns ______
This article, has just scratched the surface as to how to evaluate your company’s Returns Reduction strategy and I hope that it has opened some eyes.
IF you company is the norm, less than 20% of your company’s executives were able to answer these questions and you never rated higher than a 4 on the rating questions. What’s even more interesting is that if you asked the same questions, but about SALES, you would have gotten a much better responses! A return is nothing more than a sale in reverse. It’s a potentially lost customer that may never shop with you again. It’s a customer that may have lost faith in your Brand and may discourage others from shopping with you.
Returns are not a cost of doing business, they are a cost of doing business incorrectly and its costing your company profits. More importantly to you personally, its costing you a raise or bonus not to mention a promotion.
District Manager SELF- Assessment PART 2
This section deals with you honestly assessing your personal involvement during a store visit.
On each of the following questions circle the number that best describes YOUR CURRENT (not what you want it to be, or hope it is) level of involvement on store visits.
On a scale of 1 to 5 (where 1 is seldom and 5 is Always) rate how often the element happens on a store visit.
Walk the entire store, in depth, Dept. by Dept. 1 2 3 4 5
Ask associates for ideas about how to improve sales 1 2 3 4 5
Ask the SM questions, Vs telling them how to correct things 1 2 3 4 5
Review the P&L and Merch. Reports with Mgt. team 1 2 3 4 5
Review the plan to improve sales and margin 1 2 3 4 5
Brainstorm new ideas to improve sales & margin 1 2 3 4 5
Randomly review payroll spent by day Vs. sales by day 1 2 3 4 5
Review associate turnover rates 1 2 3 4 5
Ask mgt. what is holding sales down and plan to change 1 2 3 4 5
You demonstrate exceptional customer service 1 2 3 4 5
Review SM succession plans to develop future Mgt. 1 2 3 4 5
Assess the effectiveness of training 1 2 3 4 5
Review product return rates by dept. 1 2 3 4 5
Review plans to reduce returns by Dept. 1 2 3 4 5
Spend minimal time On the phone 1 2 3 4 5
Spend minimal time Doing email / texts 1 2 3 4 5
Total number of 1's___ 2's ___ 3's___ 4's___ 5's ___
READY MADE ACTION PLAN. It’s done! Review how you rated YOUR response to each question and at the TOTAL Check-marks and Numbers recap.
Obviously 0-24% and “1s” present TREMENDOUS opportunity to improve and the 75% - 100% and “5’s” less opportunity. NOW, Focus your efforts on the areas that will provide the greatest return.
Realize that what you need to do is different by store, so to improve faster, do one of these sheets for each store. Now you have a specific development plan by store.
Only 1 person stands between you and Success, and that' person is YOU.
We all have dreams of success! It's what gives us hope and gets us out of bed in the morning (well that and our spouse). Look around you at your peers and colleagues how many of them came into work today hoping to fail? To be the biggest loser? Probably none (well there is always someone Cranky Carol and Buffoon Bob). are not your peers or colleagues, they are your They want what you have or what you want! So what are you doing DIFFERENTLY to beat the competition?
As a Leader, a top priority of yours is to develop a Management team that produces maximum profits through improvements of the associate and customer experience.
This assessment will give you a feel for where you stand in achieving that goal and provide you with a plan to get immediate improvements. For this to work you have to be willing to be brutally honest with yourself.
No one will see this but YOU, so the only person you would fool, would be YOU.
If you could reduce your returns by 25 percent, what kind of impact would it have on your bottom line? After creating a foundation for managing returns, companies such as Philips, AT&T, Best Buy, Hoover, and P&G have reduced returns by more than $100 million. Whether your company has the potential for that kind of savings or not, the impact can be significant. A streamlined product returns management plan saves money, increases productivity and profitability, and improves customer relations.
A failure to approach returns the way you approach sales is causing you to lose customers. I don’t want to sugar coat that fact because, not only is this a serious hole in most business strategies, but this gap in customer service is fixable. When you consider the cost of attracting a new customer—which is five times greater than the cost of keeping an existing one—why wouldn’t you fix something that’s costing you so much money?
By training your staff to effectively manage customer returns, you can reduce incidences by up to 25 percent. Often this means sending the customer home with the very product they intended to return. We’ve developed four simple steps to help you train your employees to best handle returns and ensure customer satisfaction.
Profit Margins - Protecting Profits in the Face of Competition
Competition is eating into your profit margins and each day it gets worse.
With the increased use of the internet, has come an onslaught of competition. It’s not just the other guy down the street that you have to compete against. Thanks to the internet your competition has grown exponentially and continues to increase daily!
With increased competition comes the potential for a dwindling market share, higher expense ratios, and slimmer profit margins. Deteriorating profit margins are a problem for most companies or select divisions of a company. Stuart & Associates will show you innovative and practical ways to increase profit margins. This is accomplished by conducting a detailed analysis that will pinpoint the areas with the greatest opportunity. We will then work with you to quickly develop and implement a strategy that will increase your profit margins.
Our proprietary profit analysis process ARDIT Method™ delivers guaranteed financial return on investment (ROI) to major retailers and global manufacturers, such as:
How? ARDIT consists of five sequential steps that accelerate ROI and create long-term, sustainable impact. Bill Stuart, said, “It has been our experience that traditional consultants and their processes fall short because they are based on theoretical models instead of practical and tactical real-world application. And most importantly, traditional consultants do not guarantee financial return. We do. We take 100 percent of the risk out of each engagement by specifically documenting the ROI we will acheive for a client -- in the form of dollars and cents! We never provide clients with the hope that ROI will happen -- we guarantee it. Or, we refund 100 percent of our fee. That makes it pretty darn simple”.