Are you calculating your missed opportunities on a regular basis?
If you are then, presumably, you are doing something to reduce them.
If you aren’t, you are leaving money on the table…maybe lots of it!
Check out the example, below, where even if only half of the missed opportunities were eliminated, the saved revenue would be $5,187,000.00
You have to know what your challenges are if you are going to fight them.
Let’s look at a simple example of a missed opportunity calculation:
Your average transaction is $30.00.
On any given day, two of your Associates fail to convert even just two customers each.
It happens all the time and this is a very, very conservative example. Associates usually miss many more but we’re not going for shock value here.
Anyway, in this example, a total of four transactions would be missed.
At your Average Transaction of $30 each, that would be $120.
($30 x 4) In this example, you are missing $120 a day.
Multiply that lost revenue by 7 days and you are missing $840 in a week… $10,920 in a quarter and $43,680 in a year…give or take a few dollars based on the holiday closures you observe.
If I could tell you exactly how to save at least half of those missed opportunities, would you want to know how?
Probably you would. After all, it would mean an additional $21,840 in revenue.
Saving half means that each of your two Associates got better, worked harder and learned enough to salvage at lease one of those opportunities that they would have missed, according to the example.
And, what if I told you there was a sure-fire way to save 99% of those missed opportunities? You’d probably want to know about that, too.
The method I have in mind will serve a bunch of other purposes as well.
Store Managers will pick up coaching, communication and performance management tips – among other things – and they’ll learn how to hold everyone that much more accountable.
That, in turn, will contribute to reducing missed opportunities to as low as they can possibly be.
Try it out.
See what would be in it for you.
Go ahead and follow the example above, using your store’s average transaction amount.
See what kind of revenue you are really giving up…what kind of revenue you could so easily keep for yourself if only you knew how to get your people to a new skill level.
When you do your calculation, be brutally honest about the number of missed opportunities that are happening in your stores.
Unless you are one of the very few exceptions to the rule…you’ll be amazed – scared, even – possibly horrified, at the number you come up with.
But, you can get relief.
Every day that you struggle with your store performance concerns is just another day of missed opportunities.
In your retail world, store performance isn’t everything…it’s the only thing.
Achievement of sales and profit targets means continuous improvement of every KPI by, among other things, missing as few opportunities as possible.
So, how is it done?
First of all, check out this list of important ‘to-do’s’…
- Hire right
- Train well
- Hold Accountable
- Follow – up
A strong Manager trains, motivates, coaches, guides, measures and monitors and holds their associates accountable for their performance.
That includes NOT missing opportunities.
This is how it’s done, but it doesn’t necessarily come naturally.
Let’s look at another example, just to see how the stakes get bigger…
This time, we’ll look at a store with an average transaction of $95.
Using the same numbers for staff and missed opportunities from the example above, you would be giving up $380 daily, $2,660 weekly, $34,580 quarterly and a whopping $138,320 annually.
If the example was for one store in a chain of 75 stores, missed opportunities would represent a loss of revenue to the chain of…
Wait for it…
Can you get back even half ?
Yes, you can!
You can recover revenue of $5,187,000.00
Although these numbers can be shocking, the total dollars aren’t the main thing.
Everything is relative.
Even if your average transaction is really low, that’s what your business is all about and what your operating budgets are based on.
You need and deserve every single one of those transactions that are being missed.