Creating a return policy for retail merchandise

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Returned goods represent a major irritation for the retailer. When the purchase amount must be paid back to the customer for returned goods, this runs your cash flow in the wrong direction; when goods are exchanged for replacements, this represents additional costs to you in the areas of inventory handling, accounting, and, if you are an e-merchandiser, the cost of making a second shipment to the customer.

But having to take back goods is as much a fact of retail life as processing credit card purchases, and it must be endured. Looking at it another way, though, a good return policy is important to the customer and can result in repeat business.

Keep in mind that the customer returning goods is already disappointed that the goods purchased were broken, didn’t fit, didn’t work, or just weren’t right for some reason. Getting a replacement item or cash back to that purchaser in an expeditious manner and with a kind word and apology can evaporate the disappointment.

It’s vital for e-merchandisers in particular to have a good return policy because their customers, rather than seeing and handling goods at a mall store, have to rely on photos and descriptions for their purchases. If potential buyers can’t find a return policy clearly stated at the retail site, they are unlikely to put their faith in the retailer’s ethics alone. After all, purchasers only see and handle the product after they have purchased it, so they deserve some time to decide whether it is all the merchandiser said it was in the online description and they need assurances before they pay their money that goods can be returned.

E-sites must therefore ensure that their return policies are fair and appealing, stated concisely, clearly, and placed prominently so that everyone will see it. And if you know you’ve got a good policy, show it more than once; you can even make it part of your promotion. This gives consumers the security of knowing that what they are buying is guaranteed to be exactly how it was described on their computer.

Keep an eye on your return activity. If you’re getting too many returns, there is something wrong with your product or the way you’re marketing it. Take action.

Ebay Business…Lets get it on!

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1973 Marvin Gaye…ok, I am an old guy. “Old School” as my daughter describes me.

How am I going to tie Marvin Gaye into  a blog post about ebay? Simple, have you been thinking of staring an ebay business, maybe for supplemental income? Lets get it on….really, nothing happens without action and effort.  What is holding you back?

If you have an entrepreneurial spirit hiding somewhere inside you, eBay is a great place for a flight test to see if you really have been bitten by the entrepreneurial bug, or if you’re best suited to continue to work for someone else. The beauty of testing your wings on eBay is that you can do it part time and see if you have a knack for building up your business. And eBay business, if done correctly, does require a good amount of hard work, but building an eBay business from the ground floor up is a possibility open to just about anyone. If your eBay endeavors really start to pay off, you may just find yourself riding on your own momentum to create quite a substantial E-commerce empire. There have been countless ebay sellers who have started at the kitchen table and ended up with corporate offices making millions of dollars. It is not too late.

No matter what you sell, customer service must always come first. This customer first attitude is the underlying idea behind everything you’ll do to be successful on eBay. The feedback that the customers leave for you, will really define your future success. One bad feedback, especially if you’re new to eBay, can be devastating to your chances of getting people to bid on your auctions and buy your items. There is a great deal of fraud committed on eBay, so the customers that use eBay are extremely wary and find it very hard to trust sellers with low feedback scores. This means that your first strategy to building income through eBay is to get positive feedback, and lots of it.

One of the best methods to get a great deal of positive feedback early on is to sell items that are inexpensive, available to you in large quantities, and are easy to describe accurately. Profit doesn’t even have to be a priority at this stage. Certainly you don’t want to lose money, but your initial sales are solely to get you a decent amount of positive feedback. You can actually accomplish this more efficiently with a single listing using eBay’s Dutch Auction listing option, which allows you to list multiple quantities of the same item under the same listing. This service is discounted compared to listing all of the items individually, but you still can receive positive feedback for each and every one you sell this way. You will want o be a little aggressive in requesting feedback at this stage as well, just remember to always be polite with your requests.

Once you have received a satisfactory amount of positive feedback (this number can vary, but reaching 25 or so is a nice goal), then you will want to start listing more expensive items that have the greater profit margin. You might wonder why receiving a bunch of positive feedback for selling dollar refrigerator magnets will help you once you start to sell expensive jewelry or vintage radios, and the answer is because most eBay buyers don’t go through the effort of finding out what your positive feedback was for, just that you have a high percentage of it. Some will check and those buyers might be discouraged from bidding, but even if you miss out on a few of these you will still be way ahead of the game thanks to the positive feedback from those magnets!

Once you’ve established a solid feedback rating and moved on to selling what you intended to sell to begin with, it’s just an issue of maintaining high standards when it comes to item descriptions and customer service. There are small things you can do to streamline profits and increase sales, such as researching all the add on services offered by eBay like galleries, buy it now, the benefit of starting auctions at a specific time, or setting up an eBay store. But, your success on eBay is almost entirely based on your customers level of satisfaction with your products and your service, so don’t ever let anything else distract you from maintaining high standards in those areas.

Gustav, we are Better Prepared and Ready to Help!

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As our Country, and more specifically the Gulf Coast, braces for the clutches of Hurricane Gustav we can all agree that ‘we have been here before”. In fact, back in 2005 Hurricane Katrina claimed 1600 lives and caused over 44 billion dollars in property damage as reported by the ISO (Insurance Service office).

Monday September the first: Nearly 2 million people throughout the Gulf Coast have evacuated their homes under civil authority; The National Guard is immobilized to assist and keep looting at bay.

Having watched the devastating footage from Katrina for the last three years I can honestly say it appears we, as a Nation, have learned a few lessons and are reacting in a more proactive stance.

Our President has declared emergency Federal Aid for Alabama, Mississippi, Louisiana and Texas.

As a Nation, responding with assistance evacuating, sheltering and feeding over 2 million lives we are reminded that monetary assistance is in critical need.

How can I become proactive from my home…How can I reach out and offer assistance?

The Red Cross is closely monitoring Hurricane Gustav’s track. They have moved staff, volunteers, vehicles and supplies into multiple states in preparation. “We must respond before disaster strikes, which means being ready with the right resources, in the right place, at the right time.” Donate Now

Feeding America is prepared to help those in need as Hurricane Gustav approaches the U.S.  You can help support our upcoming efforts by Donating Now. Feeding America  provides immediate relief through emergency feeding centers. Some of largest food manufacturers and distributors partner with Feeding America, your donations will assist in emergency distribution.

FastTrack to Retail Failure – Shoplifting

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Shoplifting, coupled with employee theft accounts for 30% of all business failures. How do you curb theft in your store?

An arresting development: 10 billion is the price tag to retailers each year for people intent on creating their own discounts by shoplifting! That’s according to National Crime Prevention Council, citing that 25% of those caught lifting the merchandise were between the ages of 13 and 17. It could be said that it’s a sign of the times, but be careful how you read that sign. Some said they stole because of extreme need or peer pressure, but most of the sticky fingered teenagers said they did it because they were bored! That should be a billboard for all of us. Another sad statistic is that 75% of all adults have helped themselves at one time or another.

Shoplifting can take many forms: switching price tags, removing security tags, switching sizes on one half of a two piece suit are all forms of stealing. And then of course, there’s the five fingered discount that comes with just leaving the store with the merchandise concealed.

How can retailers curtail shoplifting in their establishments…..Begin with simple strategies that let potential shoplifters know you’re serious.

If you are involved in retailing, you need to become proactive in loss prevention…

• Less accessibility to small, pocket or bag sized merchandise
• Acknowledge all that enter your store with a friendly greeting…it works for Walmart
• Better clerk to shopper ratios
• Surveillance systems can send the right message
• Install ceiling mirrors which will offer visibility down side and back aisles
• Not only customer shoplift, but employees have “Sticky Fingers” as well and can contribute to tremendous revenue loss!

The bottom line for most retailers is that their profits depend on being known for taking a tough stand on shoplifting. Individuals who steal aren’t going to bother with a store that makes it too hard. For the health of their operation, retailers need to adopt the health care adage, “an ounce of prevention is worth a pound of cure.”

As a retailer you must educate yourself in handling a shoplifter as well as creating a “Loss Prevention” guideline for your employees to follow. Make sure to check local laws as they apply to a “Citizens Arrest” procedures.  Here are a couple of basics:

• You must see the suspect take and conceal the item
• You must never lose sight of the suspect after you see him take the item. The reason is
  simple, you need to be sure they still have the item on them when they leave the store
• The suspect must leave the store before you can arrest them

The punishment for theft varies from state to state based on the charges filed, the value of the merchandise, prior convictions, and age of the person arrested. As a retailer make sure to prosecute all who attempt to shoplift in your store…Send a strong signal to the community that theft will not be tolerated!

Where are your eBay Profits?

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EBay is a great example of how supply-and-demand works because sales are based almost exclusively on price. The brick-and-mortar retailer can use advertising, customer loyalty promotions, and other inducements to buy – inducements not available to the online seller. The store-based retailer has expenses the eBay seller doesn’t face: advertising, rent, store maintenance, staff’s salaries, etc. The eBay retailer can sell merchandise at a lower price than the store retailer can – and should.

Nonetheless, it’s been shown that 30% of potential buyers who find what they want on eBay end up buying from a store. Why? This trend has been attributed to slow delivery and inflated shipping costs.

Currently, we are going through a period in which the inflated price of fuel is driving up shipping costs even higher, making the situation yet more difficult for sellers. What can a seller do to deal with this situation? The best approach is to adopt aggressive strategies:

• Find, purchase, and sell merchandise that the other guys have yet to find. Americans love gadgets, especially new electronic technology. What will be the next iPhone, Xbox 300, Grand Theft Auto? Explore markets to find out, especially foreign markets that are beating out American manufacturers in pricing and creativity.
• Jump on the newest wave, then stock up on merchandise. As they say, “pile ‘em high and sell ‘em cheap”
• Pay close attention to your feedback rating. Keep customers happy. When a potential buyer sees a high approval rating, he may be more willing to overlook high shipping charges.
• Absorb the cost of posting a lower shipping charge or no charge at all. Do this only if you can make up the difference through what the customer pays for the item. This would pretty much dictate that this strategy be used only with high ticket goods.
• Don’t offer warranties beyond the manufacturer’s warranties. Avoid the hassle of handling returns and taking on more shipping charges.

When times are tough and sales are slow you really need to focus on creativity. What separates you from the other ebay sellers? Are you offering incentives to buyers such as:

• Discounts on futures purchases…..Include a coupon in every box you ship offering 10-15% off future orders
• Free Items with purchase….Take every opportunity to purchase deeply discounted closeouts that you can offer as a premium with every purchase. Make sure the free gift compliments your merchandise.
• Discounted shipping for multiple purchases…Advise your prospective bidders that you will combine winning auctions to save money on shipping
• Publish a newsletter and promote it in your auctions and About Me page. For example, if you are selling apparel you could write a monthly newsletter about fashion, clothing care and apparel trends. Of course, you would always link your newsletter to your current ebay auctions for repeat sales and traffic!

Credibility for your Home Business

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There are a lot of benefits to running a small business out of your home. However, if you’re operating as a retailer, there are a few reasons you’ll want to abstract your company from your home. There are obvious safety reasons for which you should limit the number of times you use your home address and and personal phone number on-line. Separating you and your personal information limits the amount of exposure you have to identity thieves, or anyone else out there collecting private information.

First, you should rent a private mailing address so that you don’t have to use your home address as your business address. Mail boxes are usually available from box and postal shops, and take the form of the stores street address plus a suite number. It will cost you likely less than $100 per year and is as simple as having a post office box. This way, you have the safety of abstracting your publicly-known business address from your residence. In addition, should a curious customer look you up by your address, they will likely find a commercial area, not your residential street.

Second, have a dedicated 2nd phone line installed in your home for the sole purpose of business use only. Make sure that everyone in your household understands that when the business phone rings..it is answered in a professional manner clearly identifying your business name. Personal calls come in on the house phone and your five year old child should never be allowed to touch your business line. In addition, purchase a digital answering machine to catch the business calls after hours.

Lets not forget about all thing legal. Treat your home based business just like a traditional brick and mortar location. Check local ordinances and make sure you apply for a business license if required by your city offices. Depending on where you live, there is usually a nominal fee ($5 where this author lives), and they will provide you with your business license certificate upon application submission.

Register your company name with your county and city by filling a DBA, or Doing Business As (also called a Fictitious Business Name in some places). This is simply a legal connection between you and your company name. You’ll fill out a few forms, post a declaration in a local newspaper (the county will have more info on where and how) and you’re good to go. A fictitious name statement is required if you want to open a business checking account, which is another must for budding entrepreneurs.

As you can see there are several steps necessary in starting a profitable home based business. I will back up at this point to advise anyone to put some serious time into creating a business plan. You ideas and organization will pay off through years of consistent growth and business success.

Blogging for Traffic –

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There are three major reasons to consider adding a blog to your site.
Obviously, if you have an employee that would make a fantastic and
enthusiastic advocate, their articles could drive new conversions.
But even if you have to write the articles yourself, you can see some
significant improvements in your organic search placement by simply
writing a short article every week or so.

That’s because blogs contain exactly what the search engine spiders
are looking for. Blogs and blog comments are relevant to the site, are
regularly updated, and can be an interactive community building tool
for your company.

Here’s a breakdown of the three basic reasons to finally sit down and
start that blog:

Relevant Content: It is important that your site is full of keywords
important to your business. It’s also important that they appear in
header tags, content, and aren’t unnaturally repetitive.  What better
way to fulfill all three than to write articles about your products or
manufacturers?

New and Updated Content:  Search engines have started to mark down
sites that haven’t changed anything about their site for a long time.
If your site is exactly as it was three years ago, odds are that the
spiders will assume that the site isn’t actively maintained, and
you’ll start to slip.  Blog articles are the perfect antidote to this
perceived lack of interest by the site’s owner.

User-Generated Content:  While you might think of a lot of good things
to write about, if your blog has the capacity for users to comment on
your articles, you’ll find that they provide great ideas for future
articles as well.  In addition, if someone searches for something
related to your article, and happens to use the same words as someone
in your comment thread did, your site will be one of the results
returned.  This kind of natural search placement is the reason so many
forums are returned when you search for an answer to a technical
question.  You too can get the type of SEO those technical forums
enjoy, all thanks to your visitors.

You can have a fully stocked retail website or a ton of auctions
listed on ebay, but if you have no traffic – you will have no sales!

Blogging must be included in your internet marketing strategy.
Blogging creates a huge amount of “organic traffic”.

Traffic = Sales Conversions

Large retailers like Overstock.com, Walmart.com, Reebok, Xerox
understand the marketing power a blog community can create.
Now it is time for you to….. “Get your Blog on”!

Hosted Retail Solutions – Yahoo! Store

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When you start out in e-retail, you often begin where you are most
familiar.  Ebay, for example, is a powerful way to sell online, but
takes a lot of work to keep up with listings, products, order
fulfillment, and customer service.  You can hire a team of programmers
and consultants to develop a custom store and checkout, but that is
often very expensive, and is basically reinventing the wheel.

The most bang-for-your-buck is going to be a hosted store
solution, which gives you much of the power of running a retail site
of your own with very few of the headaches.  You don’t have to worry
about any IT issues for your store (server upgrades, maintenance,
etc.).  Most solutions will have all the tools you need to get started
quickly.  They’ll include order management, product management,
tracking and reporting and more.  In just a few minutes, you can have
your site up and running using a template, complete with a working
shopping cart and checkout!

Yahoo! Stores are one of the most popular hosted retail solutions on
the internet.  Their starter package is only $50 to set up and $39.95
per month, with a 1.5% store fee.  It only takes an hour to set up and
start doing business.

Yahoo! Store has two primary advantages over some of its competition.

First, it is very simple.  This simplicity is shown in how quickly you
can set up a store, using Yahoo!’s trusted name to process orders.  It
also can be used to generate very fast, simple websites. You need no
technical experience to set up and use a Yahoo! Store, and they have
vast help documentation to guide you through anything you get stuck
on.

Second, it is very popular.  While it may not be implicitly easy to
expand, there is a vibrant community of consultants and companies that
are experts in providing after-market tools that will allow you to
make your Yahoo! Store do all sorts of things, including custom search
functionality and tracking suites.  While these add-ons will cost
money, they are generally far cheaper than having custom programming
done from scratch.

Two drawbacks which should be considered-

First, it’s based on predefined templates, which are used to generate
your site’s actual pages when you tell it to publish your site.  The
disadvantage is that you will not be able to create dynamic content
outside of the original functionality of the store.  Auto-updating
stock counts, for example, can’t be done easily, as every time you
want to change something on the site, you have to republish (which
could take a while, and is generally done once per day).  Also, as the
orders are processed on Yahoo!’s transaction servers, separate from
your store, it can be very difficult to implement third-party
tracking, such as Google Analytics, for tracking conversions.  The Yahoo
store is easy to start and use, but can be constricting if your
site outgrows the confines of static pages.

Second, while the beginner accounts are very comparable in price to
other solutions, and the larger account types have lower store fees,
they are not the cheapest at the high end of the spectrum.  If you are
doing over a hundred thousand dollars in revenue per month, the
higher transaction fees will add up.  It may not be an issue
for years from when you start your store, but it merits a moment’s
consideration, as it could add up to thousands of dollars per year in
lost margin.

Be sure to research as many options as you can if you decide to start
a store with a hosted retail solution. 

Now you have inside information on one of the biggest games in
town…most hosted stores can be set up in about an hour, so… what
are you waiting for?

Three Wholesale Hurdles for E-Commerce Startups

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So you’re starting a retail website, and are looking to set up
wholesale relationships with some manufacturers and distributors.
There are going to be a few vendor relation hurdles you’ll need to
overcome. Once you know what to expect, you can plan your product
selection realistically, and manage your growth effectively.

First: If you’re new, you won’t have many corporate credit references.
That’s okay, but it does mean that you might have to set up a credit
account with the manufacturer or distributor in order to process your
purchase orders. Sometimes it just means you’ll have shorter terms,
or the window of time you have to pay for the order after it’s placed.

Second: Unless you’re starting from a brick and mortar shop, you will
have some real trouble breaking into some product markets. There are
a lot of manufacturers and distributors out there that won’t deal with
web-only retailers. There are a variety of reasons they do this. For
example, for them, websites might be smaller accounts, requiring a lot
more work to move the same amount of product. Some vendors prefer to
deal with local shops, being careful not to have two shops that are
too close together both offering the same product lines.

Some vendors shy away from web-only retailers because websites don’t
have a customer area; they compete nationally with everyone. While
you won’t be able to push these big vendors around, you can sometimes
find that one of their smaller distributors might work with you, or
more often some of their competition will. The free market is just
as real for wholesale sales as it is for retail sales.

Third: You will want to find the right inventory model for your
business. You can stock things yourself, where you have complete
control over stock levels, and customer servicing/fulfillment. You
can also dropship, where you send your customer orders to a vendor,
who handles the final fulfillment (but not the customer service!).
You may find a balance of the two models that works for your
particular product lines.

Very expensive items will take a lot out of your coffers to stock,
and might be a good consideration for dropshipping. Inexpensive
and small items take very little resources to stock yourself, and
are often difficult to find dropshippers for anyway. Depending on
the types of products you want to carry, the warehouse space you
have to work with (be it your garage or a 25000 square foot hangar),
and your available capital, you’ll want to choose carefully how you
want to manage your inventory.

Sometimes vendor relations is as much diplomacy as it is
commerce, but knowing what to expect will help along the way.

Multiple markets create further cash flow

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Readers here at the TopTenWholesale Blog will be astounded today as I am about to unleash a cutting edge Top Eleven List offering ways to sell wholesale and liquidation merchandise.

I know the advent of a top 11 list might be a “walk on the wild side”, but bear with me. Everyone loves the good ‘ole top 10 list including viewers of the popular Late Show with David Letterman, but please remember when Top 10 lists are superseded by 11…you saw it here first. I expect full credit.

Successful retailers understand that cash flow is critical and when sales are down it might be a good idea to look for additional ways to market inventory….

1- Ebay We have to start with this auction giant. There are tens of thousands of “brick and mortar” retailers who supplement their income by auction selling. What doesn’t sell in your store can be sold online through ebay’s global market reach.

2- Craigslist – Ebay is a shareholder in this online classified website, but ebay does not have a large enough stake to influence Craig to start charging for listings! Here you can list merchandise in your geographic region for free. Upload pictures and await the emails and phones call to come…believe me they will. Craiglist is a highly visited site

3- Website – Maybe it is time to to start your own dot com empire? A wesbite will give your customers a way to visually view your products through an online catalog. The first step is deciding on a domain name…you know like www.yourname.com. You can register a domain name at www.godaddy.com for as little as $9.99 per year.

4- Classified Ads – Yes, they still print a newspaper in your hometown. Many who subscribe to the “Old School” mentality still browse the classifieds in print. I have sold a diverse offering of merchandise through my local newspaper. Give it a try-

5- Garage Sales – Maybe in your neck of the woods called a rummage sale. People love to get up early and find great deals driving from sale to sale. Word of advice: if you advertise your sale starting at 8:00 AM expect “early Birds” to start coming around 7:15

6- Flea Markets – Depending on your area, flea markets or swap meets are a great way to showcase your inventory for a reasonable per day fee. Some of the larger flea markets will have upwards of 20,000 – 30,000 visitors in a single weekend. Now that is exposure.

7- Event Sales – One or two day sales where you rent a portion of a parking lot or an actual storefront to “Liquidate” merchandise. Advertise locally and make sure you have adequate staff on hand to assist with the frenzy of sales.

8- Rack Merchandising – Start a local route re-wholesaling your products in retail stores. You can negotiate with store owners to place inventory in each store on consignment. You get paid by the retailer when your products sell. For example…if your main product line is jewelry you could merchandise your products in apparel stores, beauty shops, discount stores etc. Make sure to revisit each store on a regular weekly or bi-weekly basis to restock and invoice for items sold.

9- In-home Parties – Serious money here as giants like Tupperware, Home Interiors and other companies understand that networking with friends can be lucrative. Model your business just like the pros and host partys inviting family, friends, coworkers and strangers off the street. Ok, maybe not complete strangers. Set up a marketing compensation package to recruit others to hold partys and sell your merchandise. At each gathering setup your display merchandise and take orders while eating cookies and socializing.

10- Live Auctions – Every medium to large city will have a traditional live auction house where you can offer your merchandise for consignment. The average the commission charged by auctioneers will range from 8-12% of the final bid. I know of a very successful friend who purchases “scratch and dent” furniture by the truckload and auctions it off for huge profits!

11- Festivals/Fairs - Check your geographic area for scheduled 1 and 2 day events which allow retailer vendors. Often these events will attract tens of thousands of people who love to spend money on souvenirs and miscellaneous wares