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How to run an indie: Assessing your performance

Finding the right time to assess your progress can be tricky and is there an optimum time to add a new brand? Drapers asks the indies for their advice.

Steve Cochrane

Steve Cochrane

Steve Cochrane, owner of independent department store Psyche in Middlesbrough

How do you assess your progress?

Start assessing your progress immediately. After a month you’ll be able to see what’s sold and compare this with your stock holdings and running costs. Each month run key performance indicators analysis and management accounts.

When is the right time to add a brand?

You need to optimise potential sell-through, so research if the brand is right for your location and adjacencies. Go with your gut and talk to other retailers. Get the brand to share the risk and see if it will offer sale or return or stock swap.

When should you drop a brand?

A brand might not be working due to external factors, like the fact it’s a jacket brand that won’t sell in hot weather. Do a SWOT (strengths, weakness, opportunities, threats) analysis on that particular brand and used data generated by the EPoS system to see how it’s performing.

How do you decide when to go on Sale?

Retail theory says when you operate on a 70% sell-through at full price, run two weeks at 25% off and two weeks at 50% off you should achieve a 90% sell-out. However, most retailers forget that if you cut prices by 20% you need to increase turnover by 80% to make the same net profit.

Do you have any other advice?

Don’t be afraid of the numbers. Having an EPoS system is essential to the running of Psyche. If you asked my staff which was our best selling brand you’d get six different answers, but a report gives the cold, hard truth.

Helena Hoyle

Helena Hoyle

Helena Hoyle, co-owner of Lancashire-based two-store young fashion womenswear indie Ruby & Daisy

How do you assess your progress?

It’s never too early to assess your progress. We analyse our sales performance as a whole and per brand or supplier very early on into a season and never stop throughout. We try to order in shallower depth to give us flexibility during the season, while maintaining a good representation of a brand.

When is the right time to add a brand?

With increasing growth in online shopping and extremely price conscious customers it’s challenging to get the right products. On average we add two or three new brands a season. We introduced Lola May for spring 15 as it offers customers nice fabrics and clean lines at an affordable price point. 

When should you drop a brand?

We let brands go if they don’t sell fast enough or haven’t had a good enough reaction. If we go into Sale with a good amount of stock then we would usually drop it. For example, we decided to drop Emily and Fin as the style suits a quirkier customer than we typically get.

How do you decide when to go on Sale?

We usually start with mid-season promotions of 10 to 25% off and step this up to 70% when needed. We constantly assess brand performance and stage promotions when they’re not selling as well. While we don’t always follow the high street Sales, it would be naive to not react when needed.

Do you have any other advice?

The best approach for a retailer is to take a step back and look at the business from an outsider’s perspective. A pair of fresh eyes will help you develop your strategy, based on the customers’ needs and demands. We listen to customer recommendations and requests, and welcome reviews.

Ravi Grewal

Ravi Grewal

Ravi Grewal, owner of premium menswear independent Stuarts London in Shepherd’s Bush, London

How do you assess your progress?

With accurate sell through reports from a good stock control system you can track progress throughout the season. I like to give a brand three seasons to become established. By the second season you can analyse sell-through reports and then by the third it should be able to sell itself.

When is the right time to add a brand?

Adding new brands is easy, but staying within a budget is important. The decision should always be weighed against increasing a good seller that may have sold out early in the season. For spring 15 I added retro look knitwear from McLauren and British heritage brand Hackett.

When should you drop a brand?

Every business must make that decision based on a number of factors. Does the brand have consistent poor sell through of below 60%? A poor sell through could be because the regular customer has got tired of a long-selling brand and they’re just looking for something fresh.  

How do you decide when to go on Sale?

There should be only two real Sales, one at the end of summer and one in January. However, high street stores have started discounting earlier each year. If this carries on it will be tough to sustain a good margin, especially when garments would sell at full price during peak trade time.  

Do you have any other advice?

Staying on the shop floor in the early days is key to survival, along with keeping overheads to a minimum. Invest in an online presence and devise a good SEO strategy before you spend too much on a website. We keep our strategy in-house and approach it as an ongoing process of continuous improvement.

Jeremy Clayton

Jeremy Clayton

Jeremy Clayton, co-owner of contemporary retailer Javelin in Bury St Edmunds and Sudbury in Suffolk

How do you assess your progress?

I think you can start too soon, as it takes quite a while to get established. After your first year you have a comparison with the previous year. It’s easy to have a bad month so try to use quarterly comparisons, they give a more realistic picture.

When is the right time to add a brand?

It’s good to add new brands often to keep the offer fresh. For spring 15 we introduced Joseph and for autumn 15 we will add Ugg. However, don’t let the brands dominate your business. Bigger brands can have more criteria to meet such as minimum spends and force you to buy into different categories.

When should you drop a brand?

We usually drop around four women’s and two men’s brands each season. Women tend to be more fickle when it comes to the brands they like. Men are much more loyal. We usually give a brand two seasons, but if the sell through is less than 60% we would think about dropping it.

How do you decide when to go on Sale?

We go on main Sale twice a year on December 27 and mid July and generally hold a mid-season sale in April and October. Be careful of setting a precedent of going on Sale too early. It’s hard not to repeat that the following year. Hosting Sales previews for loyal customers helps you delay the start of your headline Sale.

Do you have any other advice?

If you’re not attracting enough of your target customers then you need to look at ways of reaching out to them, so start building your database from day one by collecting precise postal and email addresses so that you can do targeted marketing.  

Debra McCann

Debra McCann

Debra McCann, owner of contemporary womenswear boutique The Mercantile in Spitalfields, London

How do you assess your progress?

It’s never too early to assess your progress, but don’t over analyse things too soon. If you have a foundation based on solid research you hopefully won’t have to restrategise too early on, but it’s always good to bring in a group of friends and colleagues for an unbiased view on stock.

When is the right time to add a brand?

We pick up new brands all the time to add newness. With a finite amount of space we can’t just add a brand. We pick up at least six or seven new brands sometimes just taking budget from other brands or dropping them completely. We don’t change core brands like contemporary womenswear label Nümph or Dr Denim as they have a loyal following among our customers.

When should you drop a brand?

We normally give a brand at least a couple of seasons to see how it sells. We sometimes drop a brand if it has become over distributed in the area or if the relationship with the brand, agent or showroom does not offer satisfactory support. We cannot keep brands that don’t perform consistently over 65% sell-through.

How do you decide when to go on Sale?

We’re not led too much by the high street and ensure our brands don’t overlap too much with online competition, so we can choose when to go on Sale. We normally run a Sale in late December and late June. It’s getting earlier all the time. Flash Sales can work, as other stores usually aren’t on Sale at the same time.

Do you have any other advice?

Turning over product is the key. There is nothing worse than sitting on the same stock for months, not exciting to your customers or your staff. Ensure that you have some brands that deliver regularly to allow you to compete.

Michele Ferron-Leckie

Michele Ferron-Leckie

Michele Ferron-Leckie, business development manager at womenswear lifestyle boutique Roo’s Beach in Porth, Cornwall

How do you assess your progress?

Businesses don’t need long documented strategies any more. The agile approach is better, moving away from annual planning and budgets towards continuous evolution. Strategic planning needs take a holistic approach, considering every aspect of the business from stock to fixed costs to staff.

When is the right time to add a brand?

We usually commit to two seasons with a brand to give our customers a chance to get to know the brand, but we’re always on the lookout for new labels. We attend showrooms and trade shows such as Scoop to source new brands, as well as respond to customer feedback.

When should you drop a brand?

We drop on average one or two brands each season. As a young business, we’re in the process of developing our own niche. We tend to stick with a brand for two seasons but if the next season collection isn’t as strong we’d drop it. We dropped Nümph for spring 15 as we felt the colours and prints weren’t bold enough. 

How do you decide when to go on Sale?

We go on Sale at the end of the summer. Being a destination store on the Cornish coast we want to sell our stock full price during the peak tourist season from July to September. We generally focus on selling in season, so our autumn 15 styles won’t be available until September. 

Do you have any other advice?

Don’t be afraid to reallocate resources when the data tells you it’s right or let projects like newsletters, sponsorships or loyalty programme continue that you know are going to prove less valuable than others that may not have been on the original ‘wish list’.

Graham Bennett

Graham Bennett

Graham Bennett, head of product at mainstream womenswear brand Viz-a-Viz

How do you assess your progress?

Start assessing progress from the first day. Analysis of those early sales will give a good indication of popular products. Holding back some of your budget, around 30%, gives you the flexibility to react quickly to trends, as does buying from suppliers with in-season replenishment.

When is the right time to add a brand?

Even if a brand is performing well, always take a good look at the next collection. If the content seems too similar it may not be best to increase the buy, so trial an alternative brand with a similar content, but different handwriting.

When should you drop a brand?

It is easy to identify underperforming brands within weeks of their arrival. If a brand is achieving 50% or under sell-through at full price it’s clearly not appealing. Even if it has performed well for its first two seasons, be very analytical when viewing the third season’s collection.

How do you decide when to go on Sale?

A new business should learn from its competitors. By analysing like-for-like sales and understanding customer shopping habits, you will gain an understanding of when to go on Sale. Any unexplained dips may indicate competitors have gone on Sale and it might be prudent to follow suit.

Do you have any other advice?

Develop a relaxed, friendly relationship with regular customers. Make them feel comfortable to discuss their wardrobe needs and offer comments whether positive or negative on your latest products. This will help you gain insight.

 

Readers' comments (1)

  • Thierry BAYLE

    It would be interesting to ask Helena to know whether she tracks sales and stock per product category as well as per Brand/ Supplier.
    If she does it by product category and then by brand then she is a winner.
    Thierry Bayle
    @retailfashion

    Unsuitable or offensive? Report this comment

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