Retail Checklist for the New Year

Revenue
Revenue is mostly the combination of expenditures by museum visitors, including sales from online stores, catalogs, satellite stores and wholesale orders. The level of sophistication of those to whom you report, and the priorities of your institution, may affect what’s on your New Year’s to-do list, but let’s assume everyone shares the same goals and that we’re focused on your bricks-and-mortar presence. Also, let’s assume that by now some revenue projections, especially for those of you on a calendar or April-March fiscal year, have been established.

The first step to making sure revenue will be what you expect is to verify visitation expectations.

• Has the exhibit schedule changed?
• Have special exhibits or events that impact the store changed in number, length or location?
• Will you be open the same number of hours during special exhibits and events?
• How do you and others in the museum expect updated economic information to affect visitation and sales per visitor?

Because as a store manager you have relatively little impact on visitation, make sure you are at least maintaining store revenue per visitor calculations so the results of your efforts are linked to visitation.

Expenses
The biggest expense between revenue and profit is cost of goods and that’s where you may want to concentrate your review. What are some things you can do to lower the cost of goods and increase margins?

• First and foremost on the list, are you consistently calculating and following open-to-buy (OTB)? Any New Year review must include this aspect of inventory management.
• While staying within OTB parameters, can you combine or increase the size of orders to secure free freight, marketing dollars or volume discounts?
• Are you sure proprietary product development is on sound financial footing regarding the cost of production and the units required to make the retail (or wholesale) cost attractive to customers?
• Are you taking advantage of all available free marketing, such as listings on your museum’s Web site and printed publications, local online and print newspapers, and local CVB sites?

Merchandising, Display and Customer Service Retail is detail. We never know for sure which detail will impact which customer positively or negatively, but the following are sure to have an effect on revenue and should be on your checklist.

• Is your store dirty or clean?
• Is your store over-merchandised and cluttered?
• Are there fixtures with chipped laminate or scratched paint or woodwork?
• Are the carpets stained or worn?
• Are lights fully lit?
• Does the lighting leave dark areas that can be brightened?
• Is the horizontal glass on the top of your jewelry cases relatively free of scratches and view-blocking display pieces such as small spinner racks?
• Are books merchandised by category with good signage?
• Have you conducted refresher customer service and sales training recently?
• Do your freestanding fixtures generally increase in height toward the back and sides of the space so customers can see the entire store when they enter?
• Is the merchandising and display interesting enough to get a customer to slow down and linger?
• Does the merchandising and display stimulate add-on sales?

Andrew Andoniadis is the principal in Andoniadis Retail Services, a consulting firm that has specialized in revenue-generating strategies for museum stores for 17 years. He can be reached at (503) 629-9279, andrew@MuseumStoreConsult.com or www.MuseumStoreConsult.com.