#201 Six Reasons Boutiques Fail and How to Avoid Those Pitfalls with Ashley Alderson

Hey, guys, get ready for season number two of Boutique Chat.

Are you ready? I am so glad to be back with you guys.

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. I'm your host, Ashley Alderson from the Boutique Hub and I can't wait to chat.

Welcome back, you guys, to season number.

Two of Boutique Chat.

Oh my gosh, I feel like it's been a long break, right? I am so thankful to all of you who showed up each and every week, each and every Tuesday throughout season one to listen to this show and all of the Instagram messages you guys sent me, the emails, the comments inside of the Boutique Hub. I am so grateful that you guys enjoyed the season, you enjoyed the podcast, and you were so hungry for it to come back for more. So we ended the podcast season one right before the holidays, which I know is such a busy time in retail and for so many of you, it was also a really busy time for us at the Boutique Hub. We had not only family obligations, but events that we were in the middle of going to the NFR and preparing for Western Summit. And so such a busy time of year internally. So it was a great time to end season one. But man, I couldn't be more pumped than to be back for season two because there is so much happening and so much has changed since we last got to speak here on the podcast. So a couple of awesome things I'm really excited to share with you about this season on the show. We have a ton of guests that we're going to be bringing you from all over the retail industry, not just boutique owners, but boutique owners of all sizes. New to very experienced, experienced, from $100,000 stores to multimillion dollar stores, mobile boutiques, online boutiques and brick and mortar stores. Plus, I know you guys loved in the first season hearing from influencers and from wholesalers, brands and experts in our industry, whether we're talking about financials and accounting and inventory management to the latest in social media and marketing trends. So we've got tons of guests planned for season two, but also one piece of feedback you guys shared a lot was you wanted more solo episodes as well as so we're going to kick off season number two with our first solo episode of the season And a topic that I've talked a little bit about recently on social media. Maybe you've caught it there on our Facebook page or on Instagram. But I wanted to go deep into it for this episode as well, because I think it's critical to think about how we're setting up 2019, and not just what we're trying to achieve, but I want to share some insight as someone who looks at thousands of boutiques daily all over the world, and I can see what's working and what's not working. And so the topic for today really has a lot to do with what's not working and how you can avoid those pitfalls. So inside of the Boutique Hub, we have hundreds of stores that are joining our community each and every month from around the world. But we also subsequently have stores that are leaving our community because they're going out of business. And so when the team and I really look and analyze what's happening in this industry, we feel like we definitely notice some trends that are happening. And from feedback from our members, we definitely notice these trends as well. So today, let's dive into those, shall we? Let's talk about the six reasons boutiques fail and how you can avoid them. And I'd love to know, as you're listening, if there's one of these that really resonates with you, please let me know. Leave a comment or a review on the show on Apple podcasts or itunes, or just send me a message over on Instagram Jalderson or Boutique Hub business, I should say on Instagram, and I'd love to chat with you about it there. And if you'd like, we'll give you a repost there as well. I think we're definitely all in this together, and the more we can be real about not only the celebrations that we have in life and in business, but also the more we're realistic about the struggles that we have, the more we can come together and support one another to really build up our businesses to what we wanted them to be in the first place, not just an ongoing rat race of trying to keep up with the Joneses. So I want to get into what that looks like. The first reason I see so many boutiques fail, if we can dive in, is leadership failure. You know, some of you are listening, and you're still a solopreneur, and we all start there, so you're certainly in good company. You're not alone. We all start as a solopreneur, but in order to grow and thrive as a business, There comes a point where you have to make the mental shift from being a hustling solopreneur to a CEO. And it certainly is a mindset shift. If you guys have been there, you would agree it's going from thinking you have to do it all right? Everything has to run through you. You're the one that's the best at doing these things, so you have to do them. You can't pass them off and you can't delegate. It's making a shift from that hustle mode into man, if I want to grow and scale a business, I've got to have help and I've got to learn how I am not going to be the bottleneck of my business. So it's understanding where you can accept help in your business. And really what's the best way for you to delegate and to scale your time. You know, a lot of people would say money is a precious asset that we all long for. But I would argue, and I would say time is the most precious asset we have and certainly one that I think we all long for even more. So really, a secret key to growing a business is understanding the value of your time and where your time should be spent and how you can maximize your time by accepting help and delegation from those around you. You. Now, those of you who are listening and you're solopreneurs are probably thinking, yeah, but Ashley, I can't afford it. Right? And the challenge I would give to you is if you're a business owner, you are spending your time doing hundred dollar an hour jobs, right? And so when you're doing hundred dollar an hour jobs, you're building revenue. Well, you can hire someone for $10 an hour to do jobs that are not income generating but still are critical. And I use this analogy all the time because I think it's pretty relevant. If you are $100 an hour CEO, would you be spending your time, your $100 an hour time, cleaning the bathroom? Now, I'm not here to say that you shouldn't because I think every CEO has to be able to get their hands dirty, right? And do every job in the house that everyone else needs to do. But where is your time valuable? Because the truth is we can't grow a business by cutting expenses, right? We grow a business by generating revenue. So when you understand the difference and you're able to spend your time on income generating activities, then versus activities that just need to be done, but really don't have fruit at the end of the day, that's when you Step into leadership like a real CEO. The second thing I want to mention when it comes to leadership failure is I think if you're new to management, and I'll be honest with you, even in growing the Boutique hub, we're at kind of back and forth between 13 and 14 staff members at the Boutique hub. The biggest lesson that I've learned, and honestly, you guys, the thing that's been most surprising to me is what it really takes to lead a team. It is hard and there, unfortunately, I haven't read enough books about it yet because I tell you, I struggle and I fail all the time trying to figure out the best way to lead and manage a team. It's something that you really aren't prepared for because, you know, I think we get so accustomed to the way that we want to be led. I don't know if you guys can relate if you've had previous employment and you've ever found yourself complaining about your boss. Well, I tell you what, after leading a team, I would never complain about a boss again. And I take back anything I've said about previous employers because I think you don't understand what it's like on the other side of the coin until you're there. So being a leader, in my opinion, is being able to recognize what are your own strengths, what are your communication styles, what are the ways you like to give and receive affirmations. But then also what is it for your team? You know, who on your team is relationship driven or task oriented, or who's analytical or maybe who's more amiable and really hates confrontation. I think leaders truly have the opportunity to step up and recognize those traits in themselves and in others and then step into that capacity and build the skills of the team. Let them lead into what those strengths and skills are versus holding them back and assuming everyone needs to manage and operate just like you would on a daily basis. So if you've ever read the book Rocket Fuel, they talk a lot in Rocket Fuel about the power of the visionary, which is the leader of the business. Often it's the CEO and the ideas person, the squirrel, right, who has so many ideas and they want to jump from one thing to the next. But in every successful company, there's a visionary and then there's the integrator. And the integrator is the right hand man, right, who sees the visionary's ideas but is able to execute on them. Keep the team driven, organized, motivated, and across the things off the list. But also to help the visionary learn when to say no. So I would think about that for your own business. Who's the visionary in the business and who's the integrator? And are you really leading your team into your full potential? All right, reason number two, that boutiques fail, and that is failure to be unique. I don't know if you hear me, like, dropping the mic over here and preaching on my soapbox, but, guys, what the world needs is not another trendy, affordable online boutique, which so many people get into the industry feeling like they need to be in that role. I'm a trendy, affordable, under $40 Bouti. But really, we get into that thinking, man, I saw so and so do this. I saw this great boutique I follow, or I saw this boutique on Shark Tank, or I follow this boutique on Instagram, and I can do it just like them. And while we might think imitation is the best form of flattery, in reality, that's not what creates successful business owners. You know, there's only one you in this world, right? And after thousands of surveys that we have run with women who shop in boutiques through the boutiques that we coach and consult at the Boutique Hub, what I found is the majority of shoppers with boutiques are most like the leader of the boutique that they follow. The front man, the face, often the owner and the CEO of that boutique, right? Women are unique and they want to follow someone who understands them and their needs and serves them to that capacity. Someone who builds a relationship with them, right? And makes them feel special and important. Your vibe definitely attacks, attracts, not attacks. Your vibe attracts your tribe, right? So make sure that you're creating a business, your boutique, that is different from everyone else and is wholly and uniquely you and your tribe will soon begin to form and to follow. Reason number three, boutiques fail. And, guys, this kind of goes hand in hand with failure to be unique. But it's making assumptions about your customers needs and wants. And I'm going to tell you, this translates into your buying, into your inventory management, into your marketing, into your merchandising, into your photo shoots, into your social media. This is a core element of every messaging theme that we share in our business. Because so many times it's easy for us to just assume that our customers want cheap, trendy, affordable clothing, right? We feel like, oh, cheaper the better. I've got to be $2 under the store down the street in order for someone to buy this. But really, to survive in this crazy retail world, what we need is a business that solves a problem for the customer, right? So everyone can shop At Amazon, everyone can shop at some other cheap jane.com or some other retailer that's cheaper than you are. Everyone can go to Walmart, but not everybody can be served like you can serve. Right? You may have a very unique and special gift to serve your customers or offer them a unique product or educate them on how to style products that no one else can. So make sure you understand what is it that my customer is struggling with so that I can then fill that need. Then that translates into all your marketing, your videos, your social media, your branding, the way you speak and interact with your customers, both online. Off now. A couple examples, because I'm totally on a soapbox. Is it that your customer struggles with fit or body confidence, right? Knowing how to style certain pieces? Is that what her struggle is? Because then how can you lean into that and help her with that struggle? Or is it that she wants help with quality pieces that are going to last over times, pieces that can be washed 100 times versus 10 times, right? I would say at the stage of life that I'm at right now, once my kids are done, like throwing up on my shirt every 13 seconds while they're infants, I am past the trendy, affordable stage of clothing. And now I want something I can invest in that's really going to last and it's going to hold up when I wash it. So I'm willing to spend, let's just say graphic T shirts. Rather than buy a $20 graphic T shirt, I'm going to go buy a $50 graphic T shirt because it's great. It's great quality. I can throw it in with a bunch of other laundry and I know it's going to come out and still look great after I was a dozen times. So where is your customer at in this life cycle and how can you educate her about the products you carry and the quality of those products? I would also think about this. If you're serving older women, a missy customer or a customer who's looking for pieces she can wear to work, women who are looking for certain sizes, not just of clothing, but shoes, right? What is it that your customer is looking for and specifically, how can you help them? All right, reason number four, boutiques fail. And guys, this is probably the most important one. It is failure to analyze the numbers. So according to small business Trends Today, only 40% of small businesses are profitable, 30% break even and 30% are losing money. Did you catch that? 40% are profitable, 30% break even, and 30% lose money. So I would imagine that the latter of those two aren't going to be in business long. Right? So which type of business do you want to be? Because you guys, I hear all the time, you know, people in the boutique world that want to, I'll say, sound important saying I make a million dollars or I've sold $10 million or I'm on track to do this many million dollars. But at the end of the day, if there's not money in the bank or you're not covering payroll, then what does it really matter how much you sell? Because building a business is about building something that's sustainable over time for you, your family, your staff, your community, and something that can build profit. Right? So what are your numbers really telling you? What is the number in the bank really telling you? What are your margins? Your turn, rates, what's your sell through rates by class and vendor so you can really double down in your buying strategy. Or if you're significantly overbought, what's a great markdown strategy to move product? Or if you're underbought, what's your open to buy going to be for the next couple of months in the right classes and categories so you can get on track to where you need to be. This is the difference in being a retail scientist versus being a creative retail shop owner. Big time difference, right? This is where companies that are led by CEOs are made versus a company being led by a solo entrepreneur. And guys, this is the number one thing that we go through in boutique bootcamp and in really any of the trainings that we offer at the Hub, because it's the most critical part of business and it's the one so many people are scared to admit that they need the most help in. So definitely, if this is you, please hear me and lean into the fact that it's okay if you don't feel comfortable with the numbers, but there's people there to help you so that you can feel comfortable with the numbers because it's critical to your long term success. All right, number five, the fifth reason why boutiques fail. And gosh, guys, it's getting too big for your britches. Let me explain. So when we have big dreams and big visions of where we want to go and where we want to build our business, it's so easy to overextend ourselves in multiple ways. So we can overextend payroll, we can overextend our marketing budget. I mean, if you're spending $900 a month on SEO services, but you don't know what you're getting for that $900 or how that $900 is going to give you a return on investment, I would reconsider spending that money. Right. But it's also not just overextending things related to finance, but it's our time. Right? So I know that so many of you got into this business because you wanted more freedom and flexibility, and a lot of you got into this business because you're a working mom and you wanted to be able to have a great family life, but also have the opportunity to be a business owner. And if there's one question we hear all the time, it is, man, how do I deal with mom guilt? Or how do I deal with balancing business and family time? And it's definitely with phones and social media and the constant feeling that you have to be there 247 for your customers. It crushes people. And burnout, I don't know if you've been there. I've definitely been there. And it's not pretty. It's very real. Burnout doesn't just affect us, but it affects our family, our spouse, our children. They notice what's going on, and it certainly affects our staff and our customers and our bottom line. So getting too big for your britches simply means being able to take a realistic step back and looking at where's my business now and where do I want my business to be, but what's realistic in order for me to put the time in to get there, where do I need to delegate and ask for help? Right. Because that's the first step to overcoming any problem is being able to ask for help. Now, I mentioned this story the other day on a Facebook live for the Boutique Hub, and that was that. I overheard my daughter telling my husband the other day, that boy, mom, sure on her phone a lot. And I just really feel like I don't get to spend much time with her. You know, she picked us up from school today, but then she had to shovel snow, which, yes, I did have to shovel snow. But then I was on my phone again in the evening, and she felt really left out. And when I overheard her saying that, it about ripped my heart out of my chest. Because as a mother, that's the last thing you want when you're building a business for your family. So, guys, if you don't hear anything I say, hear this one. Number five, avoid burnout. Don't get too big for your britches, but really figure out how can you balance your time so that you're working on quality time, not quantity of time to build Your business. If you're watching every episode of the Bachelor, you probably have an extra hour a week that you could spend working on the business so that you can have more quality time with your family later on. All right, number six, the last one. The last reason I feel like many boutiques fail and how you can avoid this pitfall, and that is failure to learn from your mistakes. You know, I think when we go into business, traditional education would teach us, which, I mean, if we're being honest and I go on a soapbox about education, I might not stop. But I feel like traditional education fails us in the sense that they don't teach much about entrepreneurship. And all they do teach is, you know, you have to have a business plan and everything planned out to the T and then you launch and then you follow this very detailed and rigid plan. But guys, the thing they don't teach is something called mvp. The MVP model is minimum viable product. And that means if I have an idea and say a marketing strategy or my business strategy for my boutique, I have to get this stuff out there and see if it works and see what takes hold and then double down on where it's working and walk away from where it's failing. But the part of that methodology that we often don't really want to comprehend or come to terms with is that we have to be willing to let things fail. We have to be willing to try something and have it not go well so we know not to do that again or to do it different next time. Right. So many of the greatest business success stories in the United States come after someone failed. Right. How many inventions did it take for Thomas Edison to finally succeed? Right. Same is true for your business. So the definition of insanity is trying the same thing again and again, expecting different results. Right. Trying the same repeated task again and again and expecting different results. So it's okay to try something new when we're stuck in our comfort zone. We will never have the opportunity to grow and to change and to learn from what didn't work in our business. So guys, the six reasons, in case you would like a little recap, the six reasons many boutiques fail. And I'd love to know which one of these resonates most with you. The first is leadership failure. The second is failure to be unique. The third is making assumptions about your customers wants and needs. The fourth is the failure to analyze numbers. The fifth, getting too big for your britches and not managing your time. And the sixth is the failure to learn from your mistakes. So if you learned anything here today. I hope a couple of things ring true. The first is that there is only one whole and unique you and your business is truly a reflection of your character and what you want to create in your vision. So lean into it and don't feel like you have to be something that you're not or you have to be something that someone else has already done. In this world. It's okay to do something that is wholly you and your customers and your tribe are going to attract to you even stronger once you step into who you you are meant to be. The second is build a relationship with your customers. Guys, your customers want to feel an emotion when they do business with you. They want to feel like you understand them and you hear them. And when you do now you're going to be able to buy so much smarter for your business and market so much smarter in your business because you're speaking right to your customers. And finally, the numbers, the numbers matter and let them speak to you. I know so many of us dabble in the numbers and we feel like we know just enough to be dangerous. But lean into them and the more scared you are, lean in even further and don't be afraid to ask for help because there's people out there that are willing to show you what it takes to know and analyze those numbers and let them tell you a story. So guys, thanks so much for jumping back and being a part of season two with us on Boutique Chat and being such huge advocates for the Boutique Hub and the change that we're seeking to make in this industry. If you're just listening for the first time, the Boutique Hub is the central connection point of the entire boutique retail industry and the place where boutique owners, wholesale brands and industry service providers can come together and connect on a single platform where you can find expert training and education not just through our membership, but also programs like Boutique Boot Camp and Retail Boot Camp, which actually were open for enrollment this week, as well as shopping wholesale and discovering new wholesale brands both online and at apparel markets around the US plus where you can come and find tons of members only, exclusive perks and discounts on everything from insurance policies for you and your staff and your business, discounts on comments sold and QuickBooks and Hertz rental car and Office Depot. Because our mission at the end of the day is to make this industry more of an opportunity for small business owners, for independent retailers. Because we know that the backbone of the United States is built on small businesses and they are the future of our retail industry. So guys, thanks so much for listening today and for being back with Season two. I would love it. If you haven't subscribed, please do so. Leave us a rating and review for the show and connect with us here on the show or anytime at Instagram, boutiquehubusiness or me personally. Ajalderson and I can't wait to see you next week. So happy to be back guys.

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