By Jess Harris
There is nothing more satisfying than operating a successful retail business. Very few things can beat the feeling of making customers happy by offering the right mix of products at the right price.
At the same time, the retail business is one of the toughest endeavours you will ever undertake. As a retail business owner, you are always forced to juggle multiple tasks. Everything from dealing with disgruntled customers and handling suppliers to negotiating leases and managing employees all quickly become part of your expertise.
Perhaps the most critical task for a retail business owner is cash management. Being able to adeptly control the inflow and outflow of money is what separates thriving businesses from those that are just surviving. Retail is notorious for not providing a smooth inflow of capital though. This unsteady cash flow makes having a source of retail funding a must for every retailer.
Here are five ways retail funding can support your business:
1) Buying inventory
Having the capital available to purchase inventory at a moment’s notice is crucial for a retailer’s success. It is very easy to misjudge your customer’s appetite for a particular product, but not being able to restock your shelves with hot-selling items can significantly stifle your growth. While you can do your best to project future sales, it is a very inexact science.
Also, your suppliers will likely have bargain deals available from time to time. Having the ability to jump on the deal instantly will enable you to get the best price possible.
The old saying that if your business is not growing, it is dying, rings true in the retail world. Having a reliable and consistent source of retail funding can allow your business to expand quickly. Everything from locking down a location lease to outfitting the space with your design requires capital. Remember, the hot areas are always in demand. Being able to access the must-have capital when needed will enable you to stay one step ahead of your competition.
3) Making payroll
As a retail business owner, others may depend on you for their livelihood. Your hard-working employees rely on your business to support their families and lifestyle. The ability to never miss a payday is what builds trust and loyalty among your employees.
Unfortunately, the unsteady cash flow of most retail businesses can make it difficult to meet payroll on a consistent basis. The smartest way to overcome this issue is to have a reliable source of retail funding always available.
Retail business owners are entirely reliant upon their marketing efforts to attract new business. Even in today’s internet-connected age, marketing and advertising cost money. Sometimes this can be a substantial sum that may be beyond the company’s current capital.
Right now, social media is where the smart retailers are spending their marketing dollars. Setting up and maintaining an online newsletter, targeted Google ads, Twitter accounts and Facebook profiles all require an outlay of capital, not to mention the inherent cost of hiring an expert to deal with this realm while you are operating the store.
Even traditional forms of marketing, such as window displays, have their costs. Customer-facing displays can draw clients and set you apart from competing stores. Another effective marketing tactic is placing a sidewalk board in front of your store to direct customers inside. An angle on this marketing method that borders on guerilla marketing is paying someone to stand outside of your store wearing a sandwich board marketing message. This method can be highly effective in locations that a regular sidewalk board is not permitted.
To top it off, as you probably know, every form of marketing has a lag time. What this mean is that it takes a while for your marketing efforts to pay off. In fact, it sometimes takes much longer than you might expect before you see the first dollar returned from marketing efforts. Due to this delay, having a ready-to-use retail line of credit can be the ideal way to pay it forward with marketing.
Every retail business is exposed to a variety of potential emergencies. Things like a leaking roof or crashed computer can happen anytime. Having the security of a ready to use a line of credit can help manage any business emergency.
Retail funding can be key when facing a big or small cash flow situation. Since you are basically guaranteed to have slow weeks, or maybe even months, as well as booming periods, having a source of funds at the ready can help your retail business survive the ups and downs of this fast-paced industry.
Sponsored by Kabbage, Inc, which is dedicated to supporting the small business community. Kabbage is trusted by more than 100,000 small business owners and has funded more than $1.6 billion to help businesses grow. [If you are interested in sponsored content, please contact us]
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