#15 Becoming a Retail Scientist Using Data, with Geoff Tease the VP of Client Success at RICS Software

Today is all about being a retail.

Scientist and decoding your data. Get ready for episode number 15 with Jeff Tease, the VP of Client Success with Rick Software. Let's talk about your business strategy and.

The juicy details of what actually works.

From mainstream fashion to fashion on Main street and the entire ecosystem behind it. How do we scale your company and.

Do it with the balance and the.

Happiness that we all seek? Let's hear from those insiders, experts and strategists that actually make it happen, happen. I'm your host, Ashley Alderson from the Boutique Hub, and I can't wait to chat. They say that being successful in retail.

Is a balance between being both an.

Artist and a scientist. Many of us get into this business because we love the allure of fashion.

And beautiful clothes and serving other women.

But to stay in this business, it takes being a scientist and digging into the numbers and the data and the technology and all the things that make our business stay for years and years strong into the future. Today we're going to be talking to Jeff Tease, who's the VP of client success for Rick Software, which is a point of sale and inventory management software for specialty retailers. That's you guys. Boutiques, right? With a long history in retail at all sizes with companies like Reebok and many more. And Jeff brings such a wealth of knowledge to the table to retailers every single day, and he helps them to build both the art and the science sides of the business. So what we're talking about today is really critical and help me here. I'm going to nerd out as I interview Jeff. Just be prepared because what we're going to be talking about is decoding the top five must use reports for retailers that you want to check into on a regular basis. We're going to be sharing with you how to use this data to provide a better customer experience, to have better team management, to have higher sales numbers, and most of all, better inventory management and smarter buying strategy for you every single day. So let's dig in. We're going to break down your sales strategy by vendor time period, staff member, season by customer profile. And by the end of this, you.

Are going to have a whole new.

Way to decode the data in your business. This episode is packed with how tos, so if you don't have a notebook, you can. You might want to get one. All right, guys, I can't wait to hear what you think about this episode. So don't forget, please take a picture. Let me know what you're doing while you listen to this podcast today and send it to me over on Instagram J. Alderson for a chance to be featured on our story. And of course I love to video chat with you guys over via Instastory and in our Instagram DMs. Also, I want to remind you, if you are headed to the 2018 Boutique Summit in Dallas this June, you're going to have a chance to meet Jeff in person. And I know after this episode you're definitely going to want to. He's going to be there speaking and leading a breakout session all about data. So guys, without further ado, grab that notebook and let's talk to Jeff.

Hey guys, welcome to the show this week.

We are so lucky to be joined.

Today by a man with many years of experience in retail and from several different angles, I might add, both small and large. Jeff Tease is the VP of Client Success for Rick Software, which is a point of sale and inventory management software specifically for specialty retailers. So right up your guys alley. I was actually lucky enough to join Jeff on a webinar a few weeks ago now to talk about data and the numerous ways that both retailers and wholesalers really can dig into their data and make those crucial daily decisions. And I'm hoping that today, with our time on the show, we can answer some of those most commonly asked questions about data for retailers and for those of you with all different comfort levels using software. So guys, please help me welcome Jeff to the show. Hey, Jeff.

Hey Ashley.

I'm so glad that you're here.

We've got a lot to cover today, don't we?

Yes, we do. And thank you having me be part of your podcast.

Absolutely. So one of the reasons I'm so excited that you're here today is not only are you joining me here, but our community is going to have an opportunity to hear you speak at the 2018 Boutique Summit in Dallas. And not only will you be speaking, but Rick's is also a host partner for the event. And I know some of our community may have also met you in Vegas when we had our Boutique Boss cocktail party with WWD Magic. So we've got a lot to cover and I know this is going to be a great stepping stone for people to hear about data, kind of get some questions rolling and then get to follow up with you one on one at one of our events.

Yeah, we're looking forward to being there.

Awesome. So let's get started with this. I know you're a book of knowledge in this industry, so I want to talk about Rick's but before we do, let's talk about your background first and kind of how you came to the company and your experiences in retail.

Sure. You know, I think probably like a lot of the people listening, I got started in the business because of an interest in the. In. In the product. And that really came from my. My sports background played basketball in college, and while I was in college, needed a little extra money, and so I started looking for a job. And it. And getting into the athletic specialty industry seemed like a real easy connection for me. And I started working for a company called Foot X out of Dallas, Texas, in Valley View Mall, which I'm not even sure if it's still around, but started working for them. And it was a really interesting time. It's really the antithesis of what we're seeing right now. It was the. The heyday of athletic specialty, of mall business, the growth of retail space across the country. When I started with Foot Action, the company had 50 stores, and when I left, it had over 700.

Wow.

And it was really when the brands that we really know today were really starting to grow. Nike had just signed, Jordan had just introduced Air. And it was a different time too, I think about the customer back then. There were a lot less distractions and a lot less pull on their disposable income. It was a little easier to sell product back then, to be honest with you. This was before iPhones, ipods, and everything else that kind of draws kids away from. From buying athletic product. But it was a time of a lot of growth, and so it was a great opportunity. I worked my way through the stores, was a store manager for three years, and eventually ended up in the home office as. As a footwear buyer and spent about five or six years doing that. Then I moved over to the planning side of the business, you know, and it's that art versus science. So I spent a lot of time on the art side of it, and then I moved over to the science side of it with the planning. And then from there I saw an opportunity to move from the retail to the wholesale side. And I moved over to Reebok and managed the strategic sales over there and had an opportunity to work with a lot of different retailers, a lot of different size retailers, a lot of different kinds of business, which was a great experience, which allowed me to leverage an opportunity to move over to Mizuno, who is a real specialty business, very focused on some specific products and businesses and channels that they sell to. And I spent a lot of time working with small independent specialty retailers and through my time there, I eventually ended up as the VP of sales and. Which led to some contacts and some conversations that I had with Jason Becker, the CEO here at Rick's. And he and I started talking about how retailers are using data and how to communicate that to retailers. And we kind of came to the same conclusion that Rick's needed someone that could speak to the retailer on retailer terms, but really emphasized the importance of data and using data to manage their business. And we came to that same conclusion and ended up Jason offering me a role here. And I've been here for about seven months now. Been at Rick's for about seven months.

Perfect. So what a good fit.

Because isn't.

And I want to ask you more about Rick's, but their background has a lot to do with those athletic specialty retailers. So what a good fit for you to know that market's specifically to bridge that gap. But then, like you said, speaking to retailers as a whole. Correct, Correct.

Yeah, yeah. And it's. And it's. It's a conversation that, that we have at Rick's around the value of data. And I think obviously you recognize that as well through the BTC hub. And then how do. How do retailers recognize that data? Use that data and use it to make better decisions.

Absolutely. So to hear more about Rick's, I know Rick's has been around for a number of years. Do you want to give us a little bit of background on that company? Because I know a lot of our listeners understand how important it is to access data and to use data, but sometimes they don't know where to go to get it or what they should be looking for. So I'd love to hear how Rick's kind of started in that area and where they are today.

Sure. Rick started in 1983. So we're 35 years old, which is really old for a software company, but we really consider ourselves a 35 year old startup. How we approach the business, how we approach the product, and how we work with our retailers. But it started at a athlete's foot location in Iowa. The owner there recognized that he needed to be able to manage his inventory. He had a friend who had some programming skills and the guy put together a program for him which eventually turned into the RICS software solution. We've gone through several different versions of that. We're on RICS 9 right now, but it really started in Iowa. The big change for us though was in 2012 we became Cloud based. We moved from being an installed service into a cloud based service which has really opened up a lot of things for us, created a lot of opportunities in how we work with our clients. The good thing here is being cloud based. We are always on. We have almost 100% reliability. Last year we were, I think we were down for two hours. And that was because of Microsoft Azure, who hosts our cloud data. They had an outage, but outside of that, RICS was 100% on for the year. But the really good thing about it being cloud based is it provides automatic updates. If you're using Rick's, you're on the latest version automatically. It also provides real time data and it allows a lot better connection to your customers, to the brands you work with, and really allows you to create a better omnichannel environment in your retail space. But we own, build and support the Rick solution. We don't contract it out. Everything we do around Rick's is through Rick's here in our office. A really interesting feature of Rick's as well is that if you call our support team, they are all former retailers who have used Rick's. So pretty much anything you present to them, they've been through themselves.

That's really unique.

Yeah. And from a client base too. We're really focused on the kind of clients that you're working with as well. The majority of our clients are small to mid sized retailers that are in the footwear and apparel marketplace. That's really who we specialize. We do business with other retailers, but that's really where we put the emphasis for our client base.

So I know just a lot of the people who will be listening to this show. We have a really diverse audience of both online and offline stores and then a combination thereof. So can you talk about how point of sale solutions like Rick's can work in both of those realms, both with a brick and mortar storefront and with an online store like Shopify?

Yeah, it's interesting you bring that up too because about 90% of our clients right now are using Shopify as their e commerce platform. And we're seeing more and more of our new clients coming in with the expectation that there's an integration to an e commerce platform or they're starting their business with an E commerce business. So this is really important for a lot of the retailers and it's really important for us how we work with our retail retailers. But the system was built initially to be a brick and mortar inventory control system and that's really its primary purpose. But we have an open API and for people that don't know what that Means API is application programming interface. Basically, it means it's how our system talks to another system and shares data. And because it's an open API, we're able to integrate with pretty much any platform that a retailer brings to us. So we create that opportunity. But because we have that open API and we integrate so easily, we're able to transfer data back and forth on a real time basis, which is really important when you're creating that one seamless experience for your consumer. You want to have that real time data so that you're creating a really positive customer experience.

Absolutely. So someone who's listening, who may not be familiar with exactly what a point of sale solution does and what that looks like for their business. Again, whether they're on Shopify and have more of an online presence or brick and mortar. Can you kind of go back to the basics of this is our sole, not our soul, but really our core purpose. And this is how you not only track but begin to analyze your data. What does a good point of sale solution like Rick's, what is it that you offer that a retailer who has not used one before can understand how that would work in their business?

Yeah, so from a, from a core purpose of Rix, and it kind of rest in my job title and my description as well. But our goal is to provide a solution that helps our retailers improve their business and make more money. That's our goal, that's what we intend our services and our product to do. And that's really how we interact with our clients. But from an individual peel, we have these conversations all the time with clients that are going through that evaluation process and some of the things we ask them are and some of the things we expect to have in a good POS system and I think that retailers should be looking for, first and foremost, it has to allow you PO management information. It has to be a inventory control system and not just a cash register. Without that PO order management, you really can't keep a good handle on your inventory flow and manage that inventory. So that's got to be a key part of it. I think it also has to be able to provide you the quality of reports that you need to manage that business. You need to know your sales, vendor performance, staff performance, inventory flow. And so a good POS should provide that for you as well, as well as providing an efficient and effective customer experience. So, and that that really applies to the experience that you have with a customer at the Cash Wrap. Is it, is it a smooth experience as well as the experience you're providing your customer because you're able to take data in and then relay that back out through the reports and the decision making that you do. And then I think probably most importantly, you have to have a POS that allows you to grow your business as your business grows. How does it do integrations? How does it provide connectivity? How does it, does it promote an omnichannel experience? Generally, the POS is one of the biggest investments outside of product that an owner is going to make. And you want to make sure that you're investing in something that's going to grow with your business.

Absolutely. So when we were together last time, kind of piggybacking off of these key areas of business or of support that you guys provide. The last time we were together, you talked about how a retailer each week should sit down and really analyze five key reports, five key pieces of information that their point of sale provides. Can you share what those five key reports are and then we can maybe talk in more specifics about each one and how retailers can take action having that data available to them.

Yeah. From a Rick's perspective, the best practices that we recommend to our clients are the five reports of sales analysis, open po, your grid analysis, which is your size, a customer detail report, and then a salesperson analysis report. And those are on different cadences, but it's good to get on a cadence on a regular schedule and how you manage those reports and when you need to manage those reports.

Perfect. So let's talk about sales analysis first. That was the first one.

Yes.

What type of cadence do you recommend that they look at that report at? And what are the key metrics in that sales analysis would you have them go after?

Well, the great thing about the sales analysis report in Rick's is it puts a lot of information into one easily readable report. The key measures that you're going to look at your product performance and it's liquidation, turn your return on investment, and then the markdown percentage. And you can look at that across vendor level, class level and SKU level, the individual style level. And I think we find a lot of our retailers, particularly the boutiques, are doing this analysis at the class level. They're not really going down to the SKU level because it's more about a group of products, the seasonal businesses. So they're not going down to the sku, but it's really good because it gives you a full comprehensive picture of how that product is performing. Because what you don't want to do is take a look at one data point and try to make a decision. You might have great sell through but very low return on your investment with really high markdowns. So you want to make sure you're looking across several data points before you make any kind of decisions.

Absolutely. So you're going to be looking for things here like what was my maintained margin on that SKU level or by that vendor. Right. So you're understanding what really is sending and what's really selling through and putting money in your pocket at the end of the day. And then I'm assuming you're looking at this as well and saying, okay, what is my dating on this inventory? What is the most efficient markdown schedule? Right. That I should go after with this inventory.

Yeah. And this is a key part, and I know we want to talk about this a little later as well, but when you're looking at the decision making process on how to use your markdowns, how and when to use markdowns, this is a key report for that knowing is something selling well if it's not selling well and what's driving that performance, what's affecting that performance.

Perfect. And so this would also be a key report. Like if you were looking at your numbers, creating an open to buy plan for yourself, or let's say you were actually working with a planner and making those plans going into market to make your purchases for the next season, you'd be breaking down those sales by class and vendor. So you could have how many pieces do I need in this specific category by this specific vendor? So you walk in there with a plan, not just I'm going to spend ten grand in this specific category and wing it.

Yeah, and that's a great point because there's so many different filter levels on this report from vendor class skew across different time frames as well. This is a great report to use as like a vendor scorecard or an analysis report in preparation for a buying season, going to a trade show or in advance of a vendor meeting. This is the one that we recommend our retailers use for that purpose.

Perfect. And that gives you some negotiating power when you're sitting at the table with that vendor too. When you have that actual vendor scorecard and you know how they've performed, now you have some leverage to say this did or didn't work. I need better pricing or I need these terms or whatever it is. And now you're in control of the future of your financial statement.

Yeah. And Ashley, one of the things that we really recommend as well as part of our best practices and we're seeing this, retailers be a lot more open to this now is sharing this data with their vendors, with their providers, because then you can, it holds them accountable to their performance as well. And you know, if you've shared this data, you have the expectation that when they come to you, they're presenting an assortment to you that's based on actual performance and the actual needs of your store. When I ran the sales organization at Mizuno, we talked a lot about sell in versus sell through. And a lot of times on the sales side, the guys get caught up in sell in and not necessarily doing the research that the retailer is doing on the performance before they go into that meeting. So working and establishing a long term business with a retailer is you got to focus on the sell through and not the sell in.

Can you explain one step further what you mean by sell in?

Yeah. So I think from a sales side, you know, most of the reps are going to be challenged with a target that they're asked to hit, a sales target that they're asked to hit. And so how do I get that? I get more orders, I get bigger orders. And one of the things we challenged the reps to do was to look across their business in total, all of the accounts they're working with, who was performing well, who was performing down, who had opportunities, and then to build your assortment around that so that it reflected the quality of business with that, with your brand at that retailer and then how that retailer overall was performing. The last thing you want to do is go in and try to dump a bunch of product onto a retailer that isn't selling your brand well or is not performing well overall. Because in the end, and one of the questions I always ask my guys was if you're going to sell that way, you need to tell me what your exit plan is. How many return dollars are you going to need? How many cancellations are you expecting? All of that. But as a retailer, if you provide that information to your vendors in advance and on a constant basis, you can hold them accountable for that.

Yeah, that makes total sense. And it's just a win win all the way around for both the vendor and the retailer.

Yeah, it just builds a better long term quality business for both sides.

Absolutely perfect. All right, so number two report, number two was your open pos.

Open pos. And that just goes back to the question about what makes a good pos. This report allows you to see orders that you have in the system by brand, location, by date. And the reason this reports and this report's Important is this really has an impact on your inventory management and how you flow product. If you've got something that's selling well and you go out and chase it, but you've got orders in the system that for something similar or something that's going to arrive around the same time, that is a big impact on your cash flow. When I was a buyer at foot action, something would get hot, a brand would get hot, a model would get hot and I would go to my boss and say, I need more open to buy. And he would say, great, bring me your PO report and I'll show and I'll find you some open to buy. And we would have to go through and make adjustments and cancel product. You have all have open to buy dollars. You all have a cash flow amount that you're working off of. And without this information it's real easy to get off track and not be bringing in the right product at the right time or bringing in too much product at the wrong time.

I think this is probably one of the most common mistakes that new retailers make. Would you agree where if you don't have any type of reporting or tracking or inventory management system, you go to market, you place all these orders, you don't have them marked down anywhere, you forget that something you ordered was going to be coming, the ship date keeps getting pushed back, back, back and all of a sudden it's fall and your spring pieces you just ordered showed up at your doorstep and you're totally out of luck.

And this is a report that should be looked at very regularly, like on a weekly basis. And again, if you're a very fashion driven business or a seasonally driven, driven business, you really need to keep on top of that because a two week delay in something can make it irrelevant.

Absolutely, absolutely. All right, so open to open POS Next was grid size.

Yeah. And this is one that, that we stress because we found that unsold inventory is direct, direct, directly related to your size selling. Like on the footwear side, you get to the end of a shoe, the life cycle of a shoe. We find a lot of times it's those end sizes, it's the really small or the really big sizes that haven't sold and those are the most difficult to sell. So if you're analyzing your size selling on a regular basis, when you go to write future orders, you know what you selling, what's driving your sales, not only by style, but sizes within those styles. And you can avoid some of those pitfalls of unsold inventory.

Ah, that makes Complete sense. What are some strategies or best practices you guys give to retailers when they do run into that issue?

Well, the first question we ask in working through them with client success is let's go back and look at the process you're currently. Are you doing this kind of an analysis? And then we try to get this on a schedule to look at these reports. The businesses are different and some of this goes back to your relationships with the vendors, the suppliers you're working with. But if they're in the business to help you succeed, it's not out of bounds for you to ask them to help you and say, listen, I've got some unsold inventory. If you can't do that, the next best step is what's my markdown strategy? Which then goes into how do you segment customers and how do you identify customers? That could be potential opportunities to move through some of this inventory.

Perfect. Let's talk about that markdown strategy a little bit. Do you have kind of a general rule of thumb when you say you're looking at dating or again, that size grid and you know you're going to have ends left over? How do you give your retailers ideas on how to first approach that strategy? Is there dating that you look for or like certain metrics that you would go after and say, all right, let's start marking down to this or run a promotion for that to help move it out?

Yeah, I think some of that starts in advance of when the product's even received. Right. So you should be developing that knowledge of how this product performs in the past, has performed in the past, and then apply that to how you're buying it. And that allows you to establish your expectations for how something should sell. Every product sells differently at different rates. There's product that you bring in that you know is going to sell very quickly and you intend it to sell very quickly. And then there's product that you know is going to be more core, kind of repeatable, refillable items. And your expectations are different on that. So the key thing is you have to have informed expectations around the product that you're bringing in. Otherwise, if you try to apply like a blanket expectations, you're going to mark down product, you don't need to or not mark down product that should be promoted.

Gotcha. So if it's something that's fairly seasonal, like let's say we're end of summer, like transitioning into fall, how aggressive do you usually get with some of those trendier items? And at what point do you just try to get your investment back out and move on.

Yeah, and I think that's a good point, because the goal just in general for business is to generate profitable sales and create cash flow. Right. And I think when we have conversation with retailers, a lot of times they just see markdowns as. As a negative. If I do markdowns, that means I failed, I made a bad decision. Well, the reality is you're never going to make 100% the right product decisions. Product that was sold well last season doesn't sell well this season. And so you need to be prepared to generate sales off of that at a profitable level. And some of that goes back to, again, your expectation, but also what's the amount of inventory you have on hand? So if you brought in 12 pieces of something and you sold six at the end of the season, your. Your markdown strategy is going to be different. If you brought in 30 and sold six, the level of markdown, that scale of markdown is going to be different. And it also goes back to what's the margin you have built into that. But I would say that goes also back to the sales analysis report being on top of how that product is performing all the way through its life cycle so that you can recognize when a product is not performing well and address it in a timely manner. I experienced this myself as a buyer. Personal connections to product that you made the decision to bring in. Right. That's my baby. That's my kid. If I do a markdown, that's like spanking my kid. I don't want to do that. And I don't. But the toughest part is to separate that personal connection from the product decisions that you've made. Otherwise, you're always going to be thinking, you know what, one more week, I'm going to give it one more week. And that one more week is one more week that it's less relevant at full price.

Absolutely. Would you say that kind of this inventory management, markdown strategy, all that, is that a weekly, like every single week here, on top of it, the retailer sets a personal date in their calendar that they go back and make sure they're on top of those numbers. And that inventory management.

I think to be able to properly identify whether a product selling up to your expectations or below your expectations, you need to be looking at on a regular basis. And for most of our retailers, that's weekly.

Perfect. Gotcha.

We work with a retailer called Chiapetta Shoes, and when they switched to Rick's, we had the same conversation with them. What are the Reports, how often should they be doing it? And they've actually lowered their markdown rate percentage from 15% down to around 8%. And they've increased their margin because they've identified product, been able to do more timely markdowns at lower discounts, but it had a better effect on the sell through of the product.

Huge difference. Huge difference. That's when you become a retail scientist. Right. Versus just loving the creative aspect of the business.

Yes. The art versus the science.

Yes. Yes. All right, so your next report was customer detail.

Yeah. And this is a great one. When you're looking to decide how you want to segment customers for marketing campaigns or even for. When you talk about markdowns and how do I get the return on the investment, how do I make sure that markdown is effective? And the customer detail report gives you a lot of information and a lot of sortability that you can look at different things. So in general too, when you're, when you're segmenting customers, you're taking two approaches, right. You're saying, I've got product I want to sell and I need to find out who the best customers are to target for that product. Or I've got a group of customers that I want to target because they're my top tier customers. They spend the most with me, they engage the most with me on social media. And then you go and target, you do the customer detail report and you can find out what they bought, how often they bought it, how much they're spending, what product they're buying. All of that information is available to you and then you can create targets against either a markdown strategy. I've got a shoe or I've got a top. And all I have are extra smalls. Let me go find through the customer detail report all the customers that have bought extra small for me in the past and let me target something against them. So it gives you a lot of information and a lot of options. When you're looking at how you want to segment your customers and use either marketing or promotional campaigns to reach them.

What a great strategy and what a great way to make that customer feel special and feel important because you gave them such a tailored personal message. Right. That's like the entire future of digital marketing is that right there. It's being able to connect on such a personal, authentic level. And when you have that level of customer detail, you can do that versus targeting everyone and reaching no one, right?

Yeah. We talk about the ability to personalize on scale, the ability to do that. That's going to give you a lot higher return on your investment. So if you're spending money on a Facebook campaign or a mailer or however you're doing the marketing, the more you can personalize to a broader group, you're going to get a lot better return.

Absolutely. So what is the, what does the software actually look like in the customer detail report? Am I as the retailer going in and running an export of email addresses so that I can then load it into my current email provider like a mailchimp? Something like that, and then build custom audiences and Facebook ads off of that? Is it that I can export those phone numbers and then load it into say Send Text or my text marketing solutions provider? Or is something already built in? Rick's if you want like a built in software that can help deliver that message.

Yeah. One of the great benefits of the Rix solution is that it's got a very, I guess, robust customer data center. So we have when at the point of sale, there's a screen that you can enter all different levels of information about your customer. So however you want to pull that data out, you can do it across different levels. Whether it's by name, area code, phone number, purchase history, all of that is stored against the customer data profile and it gives you a lot of opportunities. The other piece too is we have five built in loyalty and rewards programs built into the system that you can use and you can assign customers to and the RICS software allows you to manage that within the system. But if you have some of those other things like a mailchimp or some of the other marketing tools you want to use because of the open API, we can connect with that and that data, that customer data shares very easily across that.

Ah, perfect. And so I'm assuming everything in terms of Shopify, again, because you're integrated there through API, all of that easily flows back and forth. Whether, again, going back to Omnichannel, whether someone's making a purchase in the store or at a mobile event or online.

Yeah. And that's what you want to do. You want to make sure that we talked about this on the webinar. I think too that you want this to be a seamless experience. The customer expects you to know them wherever you choose to interact with them. So whether that's in store, at an event, online, they expect you to know you and have that information across all of those platforms.

Yeah. Something I want to kind of point out to our community in one of our training videos. You're probably not aware of this, but we run this Program called the Best Year yet series for all of our members at the Hub in January of every year. And it's like a seven to eight week training program where there's new content every week. And one video that Sarah, who you've met from our team, who's been a retailer for over 20 years, you know, one tip that she shared with everyone in this last video that we did was using her point of sale solution. You know, she would train her staff to go in and after every, you know, person that came in the store that day had made a purchase, they had written a note, you know, about their interaction with that customer, and then trained her sales team to go in and leave that in there saying, you know, Susan came in and her mother's been sick. Send her a card or send her this note. And then once her staff, she really began to train them. And then when new customers would come in the store, they knew to immediately look up that customer in their system so that they had a great segue to start a conversation or to begin to show or add on additional product because they already know what that customer's preferences are and what they've purchased in the past or that their mother had been sick. So what a great staff opportunity as well.

And I love that approach because what you're seeing at retail now is getting out from behind the register, right, and going engaging the customer more than you have before on the sales floor and having that information and being able to just say, hey, if you don't mind, what's your phone number? Let me look up your account, your customer account, and you can get those information. Rick's does that really well too. We have alerts that you can put in on customer data, on the profile, about purchases, about events, about conversations you've had with them that allow you to connect with the, with that customer the next time they come back in the store and really personalize that experience. That's a great strategy.

One more thing to add, and I'm sure you've got several of your clients who are doing this thing. We get asked this question a lot in the community and it's a great strategy. I love to share when you're marketing to husbands, right? So if you have a women's apparel company and you want to really push sales to men at holidays or Valentine's Day or birthday or anniversary, this is how you do it, right? This is how you train your sales team to ask those questions, to get the husband's information, phone number, email address, so that the stores can then market to the men. Because I'm sure, Jeff, you've probably never forgot a birthday, anniversary, or Christmas gift, right?

Yeah. Apparently you've never spoken to my wife.

I got a popcorn maker one time for our anniversary. So the more someone can market to my husband, the more thankful I'm going to be. All right, so last report was by sales associate.

Yeah, the salesperson analysis. And some of this goes back to that conversation we just had about how do you. How do you target and approach a consumer in the store? But the salesperson analysis gives you information on every person on your staff, how much they've sold by units and dollars, the number of tickets, the number of items on that ticket, and the sales per hour that they're generating. So it gives you a really good picture of the effectiveness of your sales staff. So if you've got peak times, you've got big events, and you want to have the best floor people on the floor, you can use this report to analyze those results and identify who you want there. But it's also great because it gives you a way to establish some clear and achievable performance goals for your employees. So if your goal is to I want to have two items on every ticket, you can say, we're achieving X right now and I need you to get to two. And then you can go back and look and say, hey, employee A is exceeding that, employee B is not. Let me talk to employee B and find out what they need to do to get that, get that rate up. So it's a lot of information and it's got a lot of tools that you can use. And if you've got clients, you know, customers that are coming in that are they. This client buys a lot of items on a ticket, you want to relay that and say, hey, there's a real benefit by you doing this. And the customer who comes in and does that is buying multiple items. You've got a great connection between what your employees are expected to doing and how your customers are shopping.

Absolutely. So can you go through and name. Because I get asked this question a lot too, by retailers when they're talking about having their staff meetings and setting those achievable goals, maybe like a group goal. Some retailers don't want to say, this is our sales number for the week. So can you go through and list, kind of like you just did, a few examples of other metrics that they can use as clear and achievable goals each and every week with their team?

Yeah. And if you don't mind, I'll Give a little plug. For one of our webinars, we had Adam White from Running Central in Peoria, Illinois, who came on and talked specifically about that. And what he did was he set his goals against the company goals, the store performance goals. But he didn't tell necessarily that these were the top goals. But he related everything to each individual employee back to achieving the company goals. So as an owner operator, the first thing you have to do is establish what are your goals you want to achieve on a weekly, monthly, quarterly, annual basis. Do you have a sales goal? And then how are your employees performing now? And then what do they need to do to achieve those goals that you have set for the store? And that sales salesperson analysis report will give you all of that. But a lot of them that we really focus on is number of tickets per transaction. So. Or, sorry, number of items per transaction. So are the people on the floor?

Is that upt? Sorry, is that upt? Is that what that is? Items for units per transaction.

And that's a great indication of are your people, how well are your people selling? Are they out there showing other items? Are they using the information in that customer profile to show other product? Because the more items you have per ticket, you're increasing the effectiveness and the payroll efficiency of the people you have on the floor. So the big one for us is the upts. And then sales per hour. We really focus on that.

And that's, I mean, that number right there is so beneficial not just for team performance, but overall operations of your business. Especially if you're a newer brick and mortar or you've moved to a different location, being able to analyze that number, I mean, there's a number of things that can come from that. Knowing when to be open.

Right.

Some stores are closed Mondays and Tuesdays, for example. In very small communities, those numbers, you have to have to make those decisions.

And when do you need to have people on the floor?

Yep.

Yeah.

Awesome. Any. Any other key metrics for salesperson reports?

You know, we see a lot of our retailers will assign goals for specific products as well. You know, either a high margin product that they want their salespeople to really present to the clients, to the customers, and really push that or product that they. And this kind of goes back to your, your liquidation and your markdown strategy. Instead of marking something down, let's make it this an incentive plan for our salespeople and have them push specific products. And if you can set those goals and say, I need you to sell this, you can go back through the salesperson Analysis report and see how they've sold those specific products.

Perfect, Perfect. I remember back in my college days, I worked at the Buckle. Are you familiar with the Buckle?

Yeah, there was actually one right across the hall from me in my store in Oklahoma.

Perfect, perfect.

So I don't know if it's a.

Good thing or a bad thing to.

Say I was a Buckle girl, but.

We really didn't have many boutiques in North Dakota back in the day, so that was as close to a boutique as I was going to get. But one thing our manager at the time would do, he would run exact reporting sales by product or category, just like you're saying by team member. And then you kind of became team captain of that product or of that category, rather. So for me, I loved denim, so I was like our team lead for all of the denim sales. And it kind of goes back to like strategy on leadership. Right. Strength based leadership. So rather than trying to help your employees improve their weaknesses, you capitalize on their strengths. And whoever's selling best in this category, you make them the leader and the champion of that category versus telling someone who's great at denim how to sell menswear, you know, or vice versa. Right?

Yeah. And once that employee, the other employee sees someone having success doing that, that's an opportunity for you to do some transfer knowledge and have that employee show and explain the techniques they're using and that you share that and you kind of. You lift the performance across the whole company.

Absolutely, absolutely. So this has been such helpful information. I'm kind of nerding out about all the data talk. So I appreciate all this conversation, but kind of, as we wrap up our time together today, we've talked a lot about just the retail industry as a whole and the deterioration of big box and what that really means for specialty retail. So I'd love to know just kind of your perspective on that and where you see the future of this specialty retail, this boutique industry, where that's headed.

Yeah, I don't think there's no indication that the retail apocalypse is going to slow down anytime soon, which is unfortunate, but it's a great opportunity for boutique and specialty retailers. But I think the biggest challenge that that boutique and specialty retailers are going to continue to face is how do you adapt your in store experience in your. In your retail environment as the brick, the. I'm sorry, the online retailers really define that expectation for the customer and that's really going to require you as an owner, operator to stay on those trends. But I think it also falls on the partners that you're working with, Is the software you're working with keeping up with those changes? Is the landlord you're with allowing you to make changes? Is the product that you're being offered reflective of that? But how do you connect all of that and make sure that you're staying aware and on top of those changing customer expectations?

So the million dollar question then becomes and personal question, do you think it's essential for brick and mortar stores to have an E commerce option tied in with their current offering?

I would say, you know, the majority of the clients that we're dealing with now have either adopted an E commerce platform or asking us to provide that integration. I would say yes, it's important, but you have to have realistic expectations about what's going to come from that. It's not a cash cow, it's expensive. And that goes back again to the customer expectations that are being driven by those large online retailers. So the expectation of timely delivery, endless aisle, free shipping, all of that plays into that. And can you work that into your business model? I do think that having a online presence through a website for most small retailers is probably more important because there's a real chance for you to tell your story and get that message out without having to make that investment in either inventory or resources to support an E comm business.

So. Well said. That was a loaded question. Thanks for handling that, by the way.

Yeah, that wasn't on the earlier question list.

No, thanks for playing along. I completely agree with you though, and I think that's a relevant question in our industry today. And I'm glad that you stated it so well because I was just dealing with a client the other day who said, you know, she has a. Her and her mother own a storefront in the Midwest that I think has been in operation, I want to say somewhere around 60 years. I mean, they've been through it all and now they're trying to transition online. And she launched her site and then said, you know what, you're right, if you build it, they won't come. Like there's so much more that goes into it. So I don't want anyone listening to have this false reality of just because you have a website means it's going to sell, because it's not. There's so much more you have to be prepared for.

Yeah. And you're dealing with a lot of competition on the web. And how do you break through that white noise? It's very difficult.

Absolutely.

But I think just like you and.

I talked about on the webinar that we shared, Having an omnichannel strategy, as you stated, that has to be important. At least having a web presence, being there, being found, being relevant to your clients and adjusting to their needs, that's what's most important.

Yeah, that's where most of the customers are starting their experience with you. They want to find out who you are, what you're selling, what you do and what your environment looks like. And if you can create that on the web and provide an inviting experience through the web, you're going to get them into your store.

Absolutely. Perfect. Well, we'll wrap up with this. I'd love to know what's the one thing you're most excited about for specialty retail in the next two to five years?

You know, I think there's so much coming from a technology standpoint. It's going to be really interesting to see what becomes like the next big trend. And it's going to happen quickly. You know, you've got Amazon and Walmart and are really changing the experience, but because they're involved, they're going to make it scalable very quickly. But one of the things we talk about here at Rick's is mobility. Whether it's it's in your store, at remote events, the ability to through a portable device is going to be huge. That's going to really change the customer experience.

Absolutely perfect. Well, Jeff, thanks so much for spending the time on the podcast today and again for all of your guys support at the Boutique Hub and at the Boutique Summit, which we're really looking forward to getting to hear you again there and connect with you. Is there anything else you'd love to add or how can our listeners get in touch with you either before or in person at the Summit?

Yeah, I'm available on LinkedIn or if any of your clients have a question, they can reach me at gtease T e a s ericksoftware.com awesome.

Well, we'll be sure to put that in the show notes as well. All right, Jeff, I hope you have a great rest of your week and thank you again so much for being a part of the show.

Thank you.

Oh my gosh. Are you guys as excited as I.

Am about that episode? I love talking about data.

Now don't get me wrong, yes, I love the boutique side of things. The fashion, the shoes, all the pretty things, the turquoise that I have enough of in my closet. But really what makes a business tick is understanding the numbers, isn't it? But when you make the numbers speak to you, that's when your business really becomes successful.

So Jeff and everyone at Rick Software.

Thank you so much for being a part of this podcast. We loved having you guys as a guest today and also as a huge part of the Boutique Summit, which I'm going to tell you guys about in just a minute. But first, I want to thank Megan at Allure Boutique, because the fact that you guys take the time to subscribe and rate and review this podcast means a of ton ton to us. It helps us to get even more guests to come onto the show and we've got some big plans, let me tell you. So Megan, you left a review this week and I'm so thankful that you did because honestly, your review, it plays right into this company's vision board. I can't wait to tell you why. Megan's review says absolutely love the information and education in this podcast provided in such a flexible way. It's truly evolved the way I do business, which in turn has enhanced my course, quality of life, both personally and for my family. That's priceless. Megan, I'm not sure if you know this, but the very center of my vision board and it's been there since the very beginning of the Boutique Hub, long before this podcast, it has these big words that say, you changed my life. And to me, the Boutique Hub and the way that we approach the entire boutique industry is about changing lives and changing families and in turn changing communities. And that's what the future of retail is all about. So, Megan, that means a lot. This is exactly why we do what we do every day. All right, back to Jeff. Back to the Boutique Summit, you guys. If you have a chance to come to Dallas in person in June, if you were one of the lucky almost 500 that snagged a ticket in the first 30 hours before it sold out, you get to come to Jeff's breakout session provided by Rick Software, a partner of the Boutique Summit, and hear more about this topic in person. But if you didn't have a chance to get a live ticket to attend in June, we just dropped the link so that you can access the 2018 recordings of all 35 speakers coming to the summit online so you can watch all these recordings, all these trainings, all of the speaker downloads from the comfort of your own home without the travel to Dallas. So if that sounds exciting to you, head on over to the Boutiquesummit.com TBS2018. Again, that's the Boutiquesummit.comTBS 2018 and you can access those digital recordings now. All right, guys, if you are headed to June. Be ready for some fun. I want to say a quick thank you to Volatile Shoes who is our Boutique Boss banquet sponsor, Shoelace Technology our cocktail party sponsor Fashion Go, who many of you know and love the sponsor of our app and digital recordings and also Comment Sold. Who is building our app and providing our VIP lounge? You guys, we've got so much in store for you and many of the guests and the speakers that we've had on this podcast so far are going to be there in person for you to meet at the Summit. So pack your bags. It's just a few weeks away. Hey guys, we'll be back here next Tuesday with a brand new episode of Boutique Chat. Until then, I hope you have an awesome week and I'll catch up with you over on Instagram. Hey guys, thank you so much for.

Listening to this episode.

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