We help manage dozens of golf shops across the world. Sometimes we’re the owners of the shop. Sometimes we are the managers of the shop. Sometimes we are consultants, brought in to help find efficiency.
We’ve learned a few things in our decades of experience working in the retail space. Most importantly, having a high-performing golf shop is about managing the inventory as much or more than choosing and stocking the inventory that consumers want.
Here are six tips to help you manage the business side of your shop.
You would be wise to start your season with an Open-to-Buy-Plan (OTB). An OTB is a way to estimate how much inventory you will need to buy throughout the season. Let’s use an example:
Taking a monthly inventory is the most basic and essential step toward managing your shop. Without an accurate monthly inventory, you can’t:
Par lists are baseline inventory levels needed to fulfill your customer’s needs. They are most important for high-turnover goods like tees, balls, and gloves. Take a few moments to memorialize how much backstock you should have of these key inventory items. Par lists will make your ordering process much smoother and help you avoid having items “out-of-stock.” After you complete your monthly inventory, you can easily verify if your backstock is “up-to-par” and order as needed.
Whether you are a public or private facility, you most certainly have a group of loyal customers. Talk to a few of these folks and ask them to secret shop your store. Ask them for feedback on the styles and sizes in the shop, the customer service they receive, and how your shop compares to other retail experiences. Reward them with a thank-you gift. This input will be invaluable as you refine your operation.
Inventory turnover measures the time you possess inventory before selling it. This number should be as low as possible. Otherwise, you have valuable cash sitting in your stock room.
Start by creating a plan. If your goal is to turn everything in 45 days, then at day 46, inventory should be moved to a sale rack at 10% off. On day 60, increase the discount to 20%, and so on. These economic incentives for your customers will help you achieve your desired turn.
Next, track what styles and sizes are being moved to your sale rack. This helps you understand what isn’t selling quickly enough.
Finally, avoid buying inventory – and turn to custom orders and drop-shipping – whenever possible. A great example is the trend toward custom-ordering hard goods. Most customers want to customize their clubs, making it impossible for a small shop to carry an assortment of options. Utilize special orders and drop-shipment whenever possible. Additionally, ask your vendors to put inventory “on wheels” where you can return it for credit after a pre-determined period.
In the golf industry, we are blessed to have extremely loyal customers who visit our shops time after time. Most humans are creatures of habit. They likely park in the same parking lot area, use the same entrance to the club and take the same path through your shop on every visit. If your shop is merchandised the same way throughout the year, these customers will see the same landscape and walk by the same displays repeatedly.
To combat this, change your shop every 2-4 weeks. Move displays around. Move folded items to hangers and vice-versa. You’ll be shocked by how many loyal customers comment on “all your new inventory” after a simple floor change. Similarly, change up your displays and mannequins weekly to keep styles fresh.
Follow these six steps, and you’ll be well on your way to a high-performing, profitable retail shop.