Retail Operations 101: The Guide You Didn't Know You Needed

Marketing 19 minute read 5th September 2023

Do you want to decrease waste and increase the productivity of your retail store? Then retail operations are fantastic solutions for maximizing efficiency and profit margins. Here’s everything you thought you didn’t need to know!

Retail operations are all about effectively taking out processes for store management. And it includes the involvement of various functions, which you will know later on.

And that’s the whole purpose of this article. You will understand the explanation and functions of retail operations. Also, it will highlight the challenges retail managers face and how to improve them. So let’s follow this together!

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From Shelf to Cart: What Are Retail Operations and What Are Its Types?

Before we dive deep, here’s a question most of you are asking: what are retail operations?

Retail operations are a set of procedures for the management of a retail store or chain of stores. It concentrates on boosting the efficiency of retail processes to increase productivity and results. In return, the increased productivity builds a seamless customer experience.

These operations refer to tasks in different areas. For instance, the processes to improve the layout of the store and the sequencing of the products to sell. It also focuses on increasing dwell time and supply chain logistics management.

Moreover, retail operations professionals structure sales and marketing strategies. And when you practice it in an effective way, it creates a positive customer experience.

If you are aiming to know about retail operations, there are different types of businesses that require different procedures. Here are a few typical ones.

Let’s start with the brick and mortar retail that allows customers to search for and make purchases of products in physical stores. Second comes the online retail market. It involves using e-commerce methods to sell your product. Besides that, there’s short-term retail. It refers to small stores opening in a specific location for a small period. It helps analyze the customer interest in your product and improves your reach.

Now, what do you think about advertising your product in a catalog? Selling with catalog retail involves selling your product through an online or physical catalog.

As you now know different effective types, you can also supply your product to independent retailers for selling. This is franchise retail. It helps you to expand your local market reach.

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What Are the Primary Functions for the Management of Retail Operations?

So far, you learned about the types of retail operations. Now, let’s move to the primary functions that will help in retail operations management.

Retail management professionals use the 5S solution to organize operations which is as follows,

  1. The first step follows the sorting of retail stores. It involves organizing usable, waste, and disposal items in the store.
  2. Then comes the set in order of the products and items. This step follows labeling and grouping items as per locations, category, and store layout.
  3. The third step is about shining your store. Managers concentrate on sweeping, cleaning, and creating an environmentally friendly store.
  4. Now when your store is shining clean, it’s time to standardize the procedure.
  5. It comprises designing policies for regular cleaning, labeling, sorting, and maintenance.

The final step is to sustain these former operations. You need to analyze if the store is following these functions continuously. And make sure to improve the areas that need improvement.

However, these five steps aren’t enough. To make your functions more effective, you need skillful staff. But here’s a challenge; you have to focus on your staff training.

Talking about the staff brings us to the customer experience. Therefore, retail operation management must bring on the techniques for effective customer service. Besides focusing on your customer management, you must also give an eye on your inventory.

Typically, a retail training program covers all these aspects to improve the efficiency of the business.

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Nothing Good Comes Easy: What Challenges Do Retail Operations Managers Face?

While the retail team focuses on applying the functions for retail operations, managers might face some challenges. Retail team operations undergo some real-world obstacles. And every industry faces these challenges at some point in their business. Let’s notify some.

First of all, when the retail management lacks experience, it’ll result in collapse. Many retail businesses are dignified and carry a potent marketing strategy. But the incompetence of the retail manager or leader turns the business into a nightmare.

So your managers should be experts in the retail business to solve problems. They must have keen eyes to spot areas of improvement. And then, they should focus on implementing effective improvements.

Besides retail management issues, your work management can be another challenge because a retail store has a lot of staff in many departments. And lack of collaboration among the team will ultimately affect the metrics of retail business planning.

Because teamwork makes the dream work, therefore, retail managers should keep employee roles and duties in check. They should also observe how those roles and duties align with the disruption of information among departments.

This collaborative work takes us to the next challenge, which is managing multiple stores. Some businesses have multiple stores, and if your business is one of them, you need effective collaboration. Managing multiple stores requires connecting all of your stores at the same point.

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Find the Silver Lining: How To Improve Operational Efficiency In Retail?

Now that you have an idea of the challenges, it’s time to improve your retail operations.

Because 73% of your customers want to make physical purchases, to ensure exceptional customer service, you can use some tips on how to improve operational efficiency in retail. Here are six applicable methods.

Method #1 To Improve Retail Operations: Let Automation Take Some of the Burden

Firstly, introducing technology will be a great improvement in your retail operations. It will share half of your duties, and you will have more productivity in your business. So, here’s how retail automation comes into action.

Automation involves using different technologies and software for operations. For example, using automated systems for inventory management assists in doing inventory tasks quicker and smarter.

Since inventory management requires a lot of human hands, using automation tools will reduce your tasks and boost efficiency.

Moreover, retail marketing is a multi-channel process. You need to embrace digital as well as physical marketing. So, to take forward marketing campaigns online, you can use some of the online automation tools.

Also, the use of POS software is a reliable choice for retail businesses. It is the easiest way to create bills and help with purchases. So, an automation system is what you need.

Method #2 To Improve Retail Operations: Ignoring Inventory Management Can Be Fatal

Next, always having products in stock is fuel to retail operations. So, don’t ignore inventory management because it will result in a certain collapse.

But what is inventory management? It involves arranging, analyzing, and ensuring that you have enough stock in your inventory. Because having enough stock in your inventory is necessary to meet your customers expectations.

When customers don’t find what they need, it disrupts their experience. They may even stop buying from you altogether if it happens a lot.

Moreover, you can maximize the number of sales and minimize product waste. And due to this management, you can balance the shipping and receiving process.

There are various tools to manage inventory. And as mentioned earlier, automating inventory management will make it more effective. It will save your labor time so your employee can focus on different tasks.

Method #3 To Improve Retail Operations: Make Customer Feedback Your Guide to Success

Since you want to improve your retail operations, you should take improvement suggestions from your customers. So, ensuring your customer feedback in every way possible is the ultimate way to improve.

How? You can know your customers’ perceptions about your product, service, or business. But don’t let this feedback go to waste. Use it as guidance to make improvements.

One of the most advanced ways of getting customer feedback is WiFi marketing. WiFi marketing involves providing guest WiFi to your customers.

As they connect to your retail WiFi, they will find a captive portal that asks them to enter their information. The information might include name, email, phone number, social media handle, etc.

Once they enter information, they will have access to your WiFi. From that point on, you’ll be able to collect data about your customers while respecting their privacy. Moreover, you can prompt them to leave feedback, either publicly or privately. For example, you can show a survey form. It can be 2 or 3 short questions about their experience using your products.

Or it can be a star rating with a short sentence about their thoughts. This way allows you to access valuable customer insights.

Alternatively, you can ask for feedback live when they’re visiting. Or you can let them scan a QR code to leave their suggestions. If none of these ways suits you, let them review you on local review sites. Then, act on what people say.

Method #4 To Improve Retail Operations: Omnichannel Marketing Can Be a Hidden Gem

Marketing is another aspect you can use to improve operations. Previously you learned how to take customer feedback from different channels to make improvements. This method of uniting multiple channels to market your services is omnichannel marketing.

It focuses on creating a unified channel to provide customers with a personalized experience. It includes tracking the stage of your customer buying journey.

Then, through multiple online and offline channels, you agitate them to buy your product.

This unified marketing strategy helps you get a consistent customer. Moreover, your audience will feel comfortable buying your product. Therefore, omnichannel marketing is a big point of improvement for your retail operations.

Method #5 To Improve Retail Operations: Train Your Golden Tickets, a.k.a Your Employees

You already know that skillful staff is an asset to your retail operations. So besides expecting your employees to be productive, you should also train them. As a retail business manager, you must train your employees on different course patterns. These can be your product launch, sales policy, customer services, etc.

Moreover, tell your new employees about your procedures and operations, like the opening and closing of stores. They’re new, so they’ll need guidance on how things work around your store.

Also, if your retail store is using new software, you need to teach your employee about it. Or if there’s a new automation tool or technology update, then your employees need to understand the uses.

Method #6 To Improve Retail Operations: Track To Win the Game Back

The last method here to make improvements in your retail operations is tracking the customer metrics of your retail store.

But what should you measure? One of the most crucial insights is retail foot traffic. It entails measuring the total number of people who visit your store.

However, some people forget about their digital traffic. Don’t make the same mistake. It can give a great indication of how your digital channels, like websites or social media, are performing.

Moreover, you should also measure the customer churn rate and conversion rates. You can use the total number of conversions per total number of interactions as a formula for the conversion rate.

It will help you recognize whether customers like to buy your product anymore or not. It also assists in understanding which product makes better sales.

Knowing these insights will help you make decisions that will take your retail business to the next level.

Pay Attention To Operations in Retail for Increased Customer Satisfaction

After this whole conversation about retail operations functions and improvement, you can draw a customer-friendly conclusion. Because when you provide your products and services effectively, you’ll have happy customers. Moreover, you will be able to reach more customers and meet their expectations.

If you want to implement a WiFi marketing solution in your business, try Beambox. You can automate marketing activities, customize your captive portal and gather data from your customers. Beambox comes at an affordable rate and does not require any additional hardware. Start your free trial today!

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