Retail Expert Bob Phibbs Offers Insights on Improving Business in 2011

Nationally recognized business strategist Bob Phibbs will deliver the keynote address on Thursday, January 20, at the ABA Winter Institute. An expert on retail and the author of The Retail Doctor’s Guide to Growing Your Business: A Step-by-Step Approach to Quickly Diagnose, Treat, and Cure (Wiley), Phibbs will present practical ways that booksellers can improve customer service, sales, and their businesses as a whole in 2011.

During his 30 years of retail experience, Phibbs has helped hundreds of indie businesses in a wide range of industries, including retail, hospitality, manufacturing, and service. He served as COO, then CMO, for the start-up It’s a Grind Coffee, which grew to more than 125 franchise locations nationwide and was the second-fastest growing company in Los Angeles County two years running.

In 1994, Phibbs started the consulting company The Retail Doctor. He regularly speaks at business conferences and has been a frequent guest on MSNBC’s Your Business. His work has been featured in Entrepreneur magazine, the Wall Street Journal, and the New York Times. Phibbs’ first book, You Can Compete, is featured in Do It Best hardware’s How-to-Beat-the-Big-Box kit for 4,100 independently owned hardware and home improvement retailers. He tweets and frequently updates his website with information for retailers.

Here, Phibbs talks about The Retail Doctor’s Guide to Growing Your Business, what not to do during an economic downturn, and his upcoming talk at the WI6.

BTW: Your second book, The Retail Doctor’s Guide to Growing Your Business, your website, blog, and presentations focus on helping the independent retailer. What drew you to the indies?

Bob Phibbs: When I first began nearly 20 years ago, I didn’t really know if what I was proposing to build a business around – me as a high profile retail consultant – would work so I started small.

Owner/operators gave me a good background into what concerns kept them up late at night, and the struggles they had on a day-to-day basis. More importantly – how I could help them immediately change their sales. Back then, most everything pitted the indie versus the chain as a “David and Goliath” story. Nowadays, we see that even the Goliaths are struggling. No one has an advantage by size or even Wall Street backing. My visibility online, on TV, and in writing is to draw attention to how indies can compete. Nothing makes me so mad as reading an article on another independent closing, a TV segment on a retailer struggling, or to encounter a business that doesn’t treat me when I'm a customer like a person. Great retail isn’t that hard to understand, but it is hard to deliver every day. That’s why I remind audience members that you’re only as good as the person you leave in charge when you go to the bank. Independents that I get to work with understand this and work to deliver an exceptional experience every time.
 

BTW: The Retail Doctor’s Guide outlines a complete business overhaul. For those looking to start quickly and avoid too much procrastination, where is a good place to begin?

BP: Data. At its most basic: Are you making money at this or not? If not, for how long? I know that can seem harsh, but the numbers don’t lie. Does it hurt enough to change? If so, then you’re able to see your business in a whole new way: “What can we change?” versus “It is what it is.”
 

BTW: Your book mentions that the POS system is an under-used tool. How can it better serve the retailer?

BP: There are probably a thousand reports that it can issue, but there are eight that are critical and you’ll want to review them weekly:

1. Average check – the value of each customer that day.
2. Number of transactions (also called customer count) – the number of total sales tickets that were generated each day.
3. Weekly sales by category – your top and bottom five categories to help establish buying trends.
4. Weekly sales by salesperson – how much each employee contributes to sales per week.
5. Year-over-year by week – how you are doing compared to the same week of the previous year.
6. Year-over-year to date – a running total of your year-over-year sales to help you see the bigger trends in sales.
7. Number of units per transaction – how well your crew can upsell.
8. Number of voids – if you have a thief among your sales staff.

BTW: I love the “Pig in the Window” idea, where a display includes a totally out-of-context item as an attention grabber. Does this really work to boost sales?

BP: I wouldn’t have included it in the book if it didn’t. :) It works if you do it right. A pig in the window is a literal thing not related at all to everything in your display. It makes customers ask themselves, “Why is that there?” They are intrigued and come in to learn more. Sometimes they actually ask if you are selling the cute pig as well. Which, if you are, is not the point.
 

BTW: What are some common mistakes merchants make in a downturn?

BP:

• Discounting to try to snag market share from their bigger competitors.
• Stopping advertising.
• Calling their friends and complaining how “slow it is.”
• Allowing employees to come to work in a bad mood.
• Keeping employees because they are their friends.
• Not changing their physical store around regularly. 
• Limiting lighting to “save money.” 
• Keeping hours that are convenient for themselves, not for customers.

BTW: Can you give booksellers a preview of your upcoming talk at the Winter Institute in D.C.?

BP: Don’t care about the big boxes, online retailers, or e-books: What can you do to make your bookstore the destination your customers would crawl over glass naked to shop with?

Let’s face it, business isn’t getting easier for anyone. You can’t just hope something magical is going to change, that customers will hand you an American Express card and say, “Fill ‘er up with whatever you like.” More than ever, you have to prove yourself every day with every customer. You can’t settle for the surly employee, the dirty shelf, or not having a good website. I will present things attendees can practically do now to improve business in 2011.

Bob Phibbs will present the Winter Institute keynote during breakfast, from 8:30 a.m. to 10:00 a.m. on Thursday, January 20.