Sarah from the Boutique Hub walks through four ways to find cash fast in a retail business: collect what customers owe you, raise prices, cut subscriptions and overhead, and move excess inventory. The goal is staying ahead of payroll.
Hey guys, it's Sarah and I'm back today from the Boutique Hub to talk to you about one of the biggest issues we're seeing happening in small retail and that is not being able to pay your bills. Let's just be very upfront and open and honest about this. Cash flow problems are extremely common in small businesses. I say common because we all have faced it at one time or the other. So if you're watching this video and you're like, oh my gosh, she's talking to me, I, I've been there. I, as a retailer have been there during that cash flow crisis where I'm not sure I'm going to make payroll at the end of the month. And if I'm nothing with you, I'm very open and honest about retail and struggles that happen. And today is absolutely no different than when I had my store. But here are a few places that I always had success when it came to trying to figure out how to make payroll and find the cash tied up in my business without just hammering at my sales associates to sell them. They have got to sell more. Guys, there are three things I'd like you to look at today. One, who owes you money? Are there vendors that owe you product? Are there customers that have purchased things but not paid for them? This is not all that common anymore with layaways and store charges, house accounts, but it does happen. You very well might be one of the many boutique owners out here that have said to a friend or a family member or, or somebody that owes them money, say, yep, that's fine, we'll collect on that later. Not a big deal. Don't let those get away from you. If you are struggling making your payments, look to see who owes you money and make sure you've collected on those debts. Number two, your pricing. Often we find ourselves trying to be the most affordable boutique owner in the area. Right? You want to compete with somebody. I don't even know who this person is, who this store is. Ultimately, they might not even exist, but we find ourselves getting in this pricing game where all of a sudden we devalue our product and we devalue our offering. But yet we are trying to offer such an amazing service that costs us money. Fancy gift bags, right? Staff on hand all the time, automations and a better website and text marketing campaigns and all of these kind of things that add up. At the end of the day, we actually do run a legit business and pay taxes, right? So if we're going to give exceptional service and quality and Value to our customer. Why are we nickel and diming ourselves on our price? We're offering an elite service. We should charge that, right? So if you're debating on 41.99 versus 45.99, look at the difference. A few bucks can really make it the bottom line. The end of the year, at the end of the month really can make a huge difference making payroll this month. So go back and look at your pricing strategy and see if you're leaving anything else on the table. Odds are you probably are. All right, third thing that I think is extremely important and guys, this is general expenses, even including your overhead. Take a good hard look at the amount of money going out of your business for overhead expenses. Take a good hard look at money going out of your business for services and fees. Analyze your credit card statement. Please be reconciling that monthly. Because I've worked with a lot of boutique owners that don't reconcile that monthly. And then eventually they, they do and they think, well, I've been paying for this service every month for the last year and I don't even know what it is. Or I have a subscription to this or I have extra apps added onto my e commerce site that I don't even use anymore. But I guess I've been paying for them. Guys, the credit card bills, they're going to add up. Those, they are going to come at you and they're going to get their money. And then if you they don't, they're going to charge you an insane amount of interest. But yet we tend to pay them before, before we pay ourselves. Right? And often we write these paychecks to our employees that we just hope we're able to cover. So if you're looking at struggling, knowing where your cash is and being able to pay your bills, please look at those three things. And let's not forget our fourth one. It's our inventory. This is a big one. It's great for us to say our sales are up, but if we have overextended ourselves on the amount of inventory that we're offering and we have a lot of payables out there that we owe our vendors because we brought in so much inventory, it's not okay just to look at our sales and think we've won something because our sales are up. If we have three times the amount of inventory on our sales floor on our website that we did a year ago at this time and our sales are only up 5%, look at what that has cost us. Did we get a little excited at market. Have we overbought? Right. Is there opportunity sitting on our floor that we need to turn that inventory quicker into cash to be able to pay our bills? Probably that all comes back down to us as coaches to understand how to best do that, how to communicate that with our sales staff, how to excite our customers. Right? But before we make our number four, number one, that we've got to sell more. We've got to. We've got to move more inventory. Let's go back and look at those first three things to find our cash, because those are the things that are easily missed, and they can really add up over time. So, again, collections, your pricing strategy, and your overhead expenses. All right, guys, go find that cash. It's there. It's there. And if you have racks in the basement that you don't use that are just sitting there, sell them. If you have props or furniture fixtures that are just taking up space and you don't need them, get rid of it. Be aggressive in your business. Whatever you do, don't make a pay. Don't make an employee wait for their paycheck. That's the worst thing you could ever do. That takes all the confidence that they have for you as a business owner away. All right, guys, go find that cash, and we'll see you the next time.
