A couple of weeks ago my husband went to our favorite bakery to order a birthday cake, and was shocked to find it closed. It was a great bakery that delivered a superior product at a competitive price - the last place I expected to fail.
That bakery opened about the same time I opened my resale shop four-and-a-half years ago, so seeing it go under gives me that surreal feeling you get when someone from your high school graduating class dies. It makes me feel incredibly vulnerable, but it also - in a strange way - makes me feel better about the financial challenges my business has faced. We are not alone. The economic downturn is an uncontrollable factor that's impacting most businesses in a negative way, and the hardships we're experiencing aren't necessarily due to poor management or poor quality service.
But that doesn't mean we can't do something to improve our odds of survival. Here're a few of the ways I'm changing my business to improve the bottom line.
Expand the Business Model
My business sells second hand ladies' apparel and accessories, be we're looking for opportunities to carry other high demand products. I noticed a lot of customer were looking for cheap marked down jewelry to take apart for the beads and other parts. They're primarily jewelry makers, but - since we're next door to a scrap booking store - some use the pieces for scrap booking, sewing and other crafts. I'm capitalizing on this market by carrying a small supply of beads, buttons and other consumable items for crafters.
I've also expanded my EBay business to include product lines that are in demand but that we don't carry in the store, like men's designer clothing and some collectibles.
Develop Higher Dollar Markets
The rich keep getting richer even as the middle class disappears. It's a fact I hate, but as a business person, I must acknowledge. I started my business to serve middle class women, who needed a break from department store prices, but didn't have the time or inclination to frequent garage sales and thrift stores. That's still our main business, but as our average sales total plummeted, I've had to find ways of appealing to people who are willing to pay more.
The solution for us has, once again been to expand our selection. We now carry new clothing and fine jewelry purchased wholesale. The jewelry in particular has been key to our survival. Most of the high dollar sales we have now include at least one piece of sterling and semi-precious gemstone jewelry.
Trim the Fat
There's nothing revolutionary here, just a reminder that only the leanest operations will weather hard times. We have changed our phone service, our credit card processing, our location (reducing the rent by $1,000 per month) and everything else we possibly can. I don't renew any service or pay any bill without asking myself if there's any way I can reduce this cost.
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