Welcome to the newest post in our blog series, Darren’s Great Ideas! for Independent Operators.
In today’s economy, gift programs in many locations do not sell like they used to. Travelers and over-the-road drivers have significantly less disposable dollars, which means they’re more selective about the items they buy.
While they may be purchasing less, gift items are still an important category for truckstop and travel plaza operators, so it is important to utilize the space and inventory you dedicate to gift items.
Here are my top five tips for selling gift items.
- Extensive gift programs can be very costly as they usually have a lot of inventory tied up in a small square foot area. Space is limited, so it is important to keep your gift category tight and eliminate all redundant products. Plus, this keeps you from wasting dollars that could be used elsewhere within the operation. Take greeting cards for example. Some locations have multiple greeting card programs, but one single greeting card display can have more than $2,343 in standing retail inventory. In the example mentioned above, if you are a location with two or three greeting card racks, you can easily have between $4,600 and $7,000 in retail dollars, which could be upwards of $3,500 in CASH. That is unproductive and a waste of money. You would achieve improved turns and profitability with no sales lost if you had less racks with a smaller fixtures and improved positioning.
- Make it easier for travelers to shop the category by placing all like products together, such as mugs, regardless of vendor. It is also helpful to create themed programs, such as Coke, Betty Boop and John Deere. All of our customers have been trained to shop within departments. You do not look for your steaks at the supercenter in the shoe aisle. Consequently, when male shoppers, in particular, do not need to search for what they want, your chances of increasing sales in this category escalate.
- Carefully consider the items you plan to include in your gift section. Jewelry can be a very difficult program to manage properly. Programs that have names associated with them can also be challenging. It is wise to purchase challenging programs through vendors you have strong relationships with rather than someone who just happens to have the best price in town that day. Challenging products can, however, be lucrative such as themed gift apparel. Gift apparel can create significant sales and gross margin dollar profit when done in conjunction with movies, fads and social media trending. Take care not to be in these types of products too long as the sales often turn cold as quickly as they became the hot ticket to purchase.
- Consider creating specific programs around certain items. Programs sell products and this is particularly true for gift themed apparel and headwear. With themed apparel programs, consider seasonal items, such as spring/summer and fall/winter products. And remember, when it comes to selling gift themed apparel, you do not need a lot of redundant product. The same can be said of a gift themed headwear program. When done properly, you can really sell some hats.
- Most importantly, know your customers and know them well. Know why they shop with you. You also need to know and understand your program, your inventory levels, daily sales, turns and GMROII in this category. When done correctly, the sales and profit per square foot can be astonishing, when done poorly it can be a dreadful one TURN a year albatross. Like any merchandising program, the program will create significant more sales and profits when it is not left to its own devices. Work with your vendor partners to ensure you have productivity goals and you are implementing best practices.
When reviewing your programs, be open to trying new things. This quote from Benjamin Disraeli sums it up: “Action may not always bring happiness, but there is no happiness without action.”
/// Read more Darren's Great Ideas for Independent Operators posts here.
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