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{Great Ideas} Three Cardinal Sins of Retail

Posted in: Great Ideas, Darren's Great Ideas for Independent Operators

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Welcome to our newest blog series, Darren’s Great Ideas! for Independent Operators. Darren Schulte, NATSO’s new vice president of membership, brings to NATSO a wealth of knowledge about our industry.

Darren has nearly three decades of experience in truckstop and travel plaza operations and merchandising, most recently as the vice president for retail merchandising for TSC Global/Barjan LLC. In 2011, he visited more than 100 independent operators throughout North America. Prior to his time with TSC Global/Barjan LLC, Darren worked for Petro Stopping Centers, Hess Oil and Love’s Travel Stops and Country Stores.

Join Darren here every other Thursday for his biweekly retail column.

Cardinal Sins of Retail

by Darren Schulte 

Our industry has been suffering from a reduction in comparable diesel gallons and decreasing customer counts for quite some time. To continue to grow sales, businesses must avoid these three cardinal sins of retail.

1. Out of stocks
When faced with an out of stock while shopping, 31 percent of consumers purchase that product at another store. Stores lose about 4 percent of sales each year due to out of stocks. Be sure to order properly. Many successful locations have improved their ordering by no longer allowing vendors to place blind orders, creating ordering calendars that identify scheduled vendor visits and ordering cycles, and creating appropriate but simple build to/par level when ordering product. Put a premium on stocking shelves. Shelves should be restocked every time your Direct Store Delivery (DSD) vendors visit your store and checked on every shift.

2. Lack of signage
Signage increases sales. While too many signs create clutter, too few create disorientation. Some of the best messaging examples can be seen at CVS and Walgreens. Do not try to reinvent messaging. There are plenty of organizations that can be used as best practice applications. These examples, such as creating focal points with floor displays, can be done in your own operation by asking your vendor partners to create matching or simliar displays with the appropriate point-of-sale observed in other fine retail establishments. Ask the retailer for permission, and snap a photo of what you like and create it in your establishment.

3. Unproductive assets
Don’t load your store with unproductive assets that are expensive to maintain. Think of your merchandise as dollar bills. Learn what your GMROII should be for your categories and design your product placement based on the percentage of revenue your categories are generating. Don’t have 50 percent of the available linear retail space assigned to a product category that is only generating 20 percent of your sales. Likewise for category turns. Although beverage has a high GMROII, if the category is not turning more than 12 times annually, you have unproductive assets.

/// Read more Darren's Great Ideas for Independent Operators posts here

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Join the conversation! What is your best trick for preventing out of stocks? How have you improved your signage in the last year? Post your ideas in the comments below.

Or have a different retail merchandising, marketing or operations question? Post your question in the comments and Darren will answer it in the next Darren’s Great Ideas! for Independent Operators.

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About the Author

Darren Schulte

Darren Schulte

Darren Schulte serves as Vice President of Membership at NATSO. In this role, he directs recruitment, retention and customer service for truckstop and travel plaza members. He is also responsible for developing NATSO products and programs, particularly those relating to education, research and training for truckstop and travel plaza operators.

Schulte joined NATSO with nearly three decades of experience in truckstop and travel plaza operations and merchandising, most recently as the Vice President for Retail Merchandising for TSC Global/Barjan LLC. Prior to his time with TSC Global/Barjan LLC, Schulte also worked for Petro Stopping Centers and Love’s Travel Stops and Country Stores.