With developments in technology there is now an increasingly large number of resources available to help business owners operate their stores more effectively.
As great as technology is though, one of the best resources for improving business has been around for decades and it’s absolutely free – it’s called networking.
Networking provides a huge number of benefits for any business owner. Here are some reasons why:
- Knowledge – no person is an island and no one has a monopoly on the best ideas and practices that are available. Sharing knowledge with fellow retailers is one of the best ways to drive a business forward
- Sourcing of product – there is such a huge selection of suppliers and no one business owner can have a full handle on everyone’s offerings or prices. Networking with other retailers can show who has the best deals and benefits and can also provide some social proof before embarking on dealing with new suppliers, particularly in the trade-show environment where retailers often encounter suppliers they have not met or dealt with previously. There are plenty of retailers who will only deal with recommended suppliers and attend trade shows armed with a recommended go-to list of businesses from whom they’ll purchase. This can save considerable time and that overwhelming feeling
- Psychological benefits – being a business owner can be a lonely road. The camaraderie and support of a network of similar operators can be a great source of comfort when things get tough and also provide someone to celebrate with when things go well
- Social – most business networks become the foundation of firm friendships that can last well past the existence of the business relationship.
Setting up an effective network
The most important requirement is that jewellers find like-minded retailers who share the same values but have strengths in areas in which they may lack. A similar type of store is a plus as is similar size and market place.
It’s important that the arrangement is formalised and it’s recommended that regular meetings take place about every quarter, either face-to-face – perhaps coinciding with buying days or trade fairs – or via online methods such as Skype.
One of the key criteria is finding retailers who are willing to contribute and openly share. Everyone needs to be willing to commit and bring something to the discussion. The aim is to find committed business owners willing to help others – this is no place for people only looking to take.
An ideal size is about six business owners who can each provide fresh ideas without meetings becoming bogged down and difficult to run. Rotating store visits is also encouraged to provide physical commentary on each participating store.
What can be achieved at meetings?
Having an agenda is critical to maximising time together. Here are some valuable topics to discuss:
- Finance and stock – a comparison of financial reports can be a great starting point. Who is achieving the best mark-ups? Who has the highest diamond sales? What about the best average? These are the perfect starting points for discussion. If one store is achieving a better margin than the rest, ask them why. From great questions come great answers
- Competition – competing with each other can be fun and encourages staff to strive for better results. In the good old days of the fax machine, I knew two stores that would compete to see which store achieved the most sales of $500 or more in a month. The winner shouted the loser McDonalds vouchers! Faxes would whizz back and forward between the stores, creating a real spirit of friendly competition
- Marketing – working together with other stores can provide great buying benefits when sourcing large quantities of product. It can also offer unique marketing opportunities that can be shared between the parties involved. I know a group of four stores who set up their own diamond collection, developing collectively a unique arrangement with a supplier that provided them with a selection they might not have been able to establish individually. The range would tour the four stores and they were able to produce marketing material at a shared cost that would have been costly for them to create on their own.
Networking is an often under-utilised opportunity to generate value by tapping into the knowledge of others. Setting up a formal network with like-minded retailers will lift businesses to another level that cannot be achieved on one’s own.