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HOW TO INCREASE TURNOVER?

The turnover of a sales outlet depends on two main factors: the number of purchases and the amount spent by each consumer. To boost turnover, it is therefore necessary to increase visits and/or improve the “average basket” that is calculated by dividing the turnover by the number of sales receipts issued.

1) HOW TO INCREASE THE VISITS OF AN OUTLET?

The goal is to increase traffic in the outlet by attracting new customers and by bringing in more often those who visit from time to time, all while keeping the loyal customers. Indeed, three types of consumers should be considered: the regulars, the occasionals and the potentials.

  • The “regulars” already come to the store, but for them to keep doing so, you must set up attractive loyalty systems (Cocci Bonus, Loyalty card), listen to them and meeting their needs and wants in terms of selection (having the right products at the right time) but also services (suitable opening hours, preparing shopping orders, snack areas, etc.).
  • The “occasionals” tend to be fickle as they visit several different stores, according to their budget, their schedule, special offers, the reception, etc. To make them come back regularly, you must understand the reasons and their behaviour and remedy them by seducing them with a complete offer, better services and a personalized welcome that they do not necessarily find elsewhere.
  • The “potentials” are more difficult to reach because they do not know you. To attract them, a good way: open your first outlet when the others are closed! Organise strong animations (anniversaries with half price offers, euro fairs, etc), with an extended distribution of flyers, are also effective ways to make your store known to new customers. However, be careful not to disappoint them by attracting with an offer that you will not be able to realise!

Finally, if you are “good” (good selection, good prices, good reception), the word of mouth will work because there is no better ambassador than a satisfied customer!

2) 2) HOW TO IMPROVE THE AVERAGE BASKET?

The goal is to sell more products and/or higher value products to consumers. Several proven methods can be applied. It is up to you to find the most suitable one(s) among those that we have selected through various testimonials gathered in your networks.

A) EXTENDING THE SALES AREA AND/OR MODERNIZE YOUR OUTLET

Extending the sales area is the most efficient way because more square metres will allow more choice, better shopping experience, a change of communication, hence more special offers and finally, not only an increase in the average basket, but also an increase in visits thanks to word of mouth. Similarly, the modernization of the sales outlet (decor renovation, new furniture, new tiles, new lighting enhancing the products) generates significant increases in turnover (on average between 15 to 20 %). The report that we regularly present in Coccinews prove it.

Recommended: manage the cost of investment. Take advice from a regional central purchasing and follow the recommendations of the service “enseignes” of Francap.

B) CHANGING THE FURNITURE BY EXPANDING THE SELECTION

If you cannot extend the walls or transfer your outlet to gain space, getting new furniture can give good results: e.g. the setup of a new six-level or seven-level L.S. dairy and deli counters, boosts turnover thanks to the quota of fresh produce and profit generating references in the reception area (including deli and snack). A new display shelf for fruits and vegetables, equipped with specific lighting, not only allow to expand the offer, but to treat this section as a specialist section, thereby creating a new strong point of the store. Finally, by simply replacing the traditional gondolas by high gondolas, almost doubles the offer of dry products and consequently increases turnover.

Recommended: Ensure a strict supply and shelf management to avoid running out of stock (very poorly perceived by the customers) and for fresh produce, especially, change the selection according to the new products and monitor the use-by dates.

C) MERCHANDISING THE STORE

A better presentation of the offer, which is clearer and more understandable, by following consumer logic and by highlighting products with high added value to provoke impulse buying, also contribute to the increase of the average basket.

Recommended: this requires a good knowledge of merchandising techniques and products. Do not forget: High margin products (e.g: Belle France and Delices de Belle France products ) must be placed at the right height: between the eyes and the navel!

D) REORGANISING THE SELECTION TO IMPROVE CHOICE

Better, for example, with a facing display to place 2 cans of cassoulets with different recipes instead of 2 cans with the same recipe! Do not hesitate to remove the references that do not work well and quickly introduce new products if their release is accompanied by a campaign of tv advertising. The consumer must also be able to choose between different price levels that’s why it is important to arrange your selection in the following way with national brands, store brand and low-costs brands that you will however limit to not lower your profit margin.

Recommended: Use the sales history to make the right choice. Keep up to date with new product ranges and new references to give a dynamic image of the outlet and develop impulse purchases.

E) LOWERING YOUR PRICE ACCORDING TO THE COMPETITION

This action is especially valid for hypermarkets, allows to increase the volume of purchases and the traffic. It also gives a new status to the store that switches from the “semi-back up” function to the “supermarket” function.

Recommended: most importantly, do not do it all alone. Discuss it with your central purchasing. Be reasonable to keep a certain margin level and do not lower your average basket. This would be contrary to the goal.

F) HIGHLIGHTING A SECTION BY TREATING IT AS A SPECIALIST AREA

Without going into the complete modernisation of the outlet, it is possible to highlight a section by treating as a specialist zone. Thus, the transformation of the wine section into “Wine cellar” with its very spectacular layout and specific lighting, gives excellent results. Better set up and embellished, the perfume section also has interesting turnover potentials.

Recommended: requires a good knowledge of the products to advise the consumer.

G) WORKING ON SALES ANIMATION

By following the national and regional promotional operations, distributing flyers, communicating in the regional daily press and on the local radio, and by placing the POS display (posters, hook marker) at the beginning of the operation, creates traffic therefore increases turnover. It should be noted that customer retaining systems (Cocci Bonus, loyalty cards) that encourage consumers to buy the product with a bonus rather than another, batch sales (2 products instead of one), the combination of products on current topics (raclette, crepes, sauerkraut, etc), proposed in the flyers, have also a very positive impact on the increase of the average basket.

Recommended: The sales animation of your outlet is essential to boost your turnover and improve traffic. Zapping it is not economical!

H) FOCUSING ON CUSTOMER RELATIONS AND OFFER THE RIGHT SERVICES

Recommended: Do not forget that reception, availability, listening, services that meet the needs of consumers, are the main assets of your convenience stores. The main reason that we come to you!

SOME ADDITIONAL TIPS:

When you have used up all your revenues and that your turnover is out of breath:

  • Change your opening hours (non-stop opening hours on weekends, late closings on some days of the week, open on Mondays when the retail shops are closed, …)
  • Organising and monitoring at the front of the check-out to develop impulse buying of products with high added value.
  • Creating an organic, fitness and health section to meet the expectations of consumers who are increasingly interested by these products.
  • Setting up marketing actions in the traditional butchery section with very attractive batch sales.
  • Highlighting fine and award-wining wines: sold x 6 = sales increase of 10%
  • Maximum use of endcaps for bulk sales of stackable products, thus generating volume and turnover.
  • Adopt trolleys or/and high capacity baskets. Example, switching from 150 L to 175 L trolley can increase the average basket by 7% (it must however be reasonable considering the area of the store).
  • Set up a beer pump (price: € 128) which can create an additional animation in the outlet, attracts new clientele, etc.

INVEST? YES, BUT UP TO…

Investing is sacrificing resources today to gain more later!
An investment, however modest, commits the future. It is irreversible and presents risks because it absorbs part of the company’s financing capacity. It is therefore important to study the profitability of the investment:

  • 1) Taking into account the risks and analyzing the financial constraints generated by the investment: the credit will weigh on the cash flow and on the net profit.
  • 2) By establishing the “break-even point”, that is the break-even point below which money is lost and above which it is earned, by evaluating the figure that can be made thanks to an investment.
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