Teach that “You miss 100% of the shots you don’t take!”

By Shawn Kiley

Aloha!

For the last several months, we’ve been focused on suggestive selling, but primarily in the restaurant industry.  Although many of the ideas we have talked about can be used in virtually any area of the hospitality industry, this month we will focus more specifically on retail organizations and how to help your staff increase your sales and profits and lower your costs.

The other night, I was attending a local hockey game here in Charlotte, our ECHL Charlotte Checkers, and I was enjoying the game and also enjoying a conversation I was overhearing between a father and son who were seated directly behind me. The father was explaining some of the rules of the game to his son, and during their give and take, Dad said something priceless. When the son questioned his dad about why one of the players took a slap shot all the way from center ice, Dad simply said, “You miss 100% of the shots you don’t take.”  He then had to flesh out what this means so that the boy more clearly understood, but I immediately understood his philosophy and I thought to myself at the time that this doesn’t simply apply to hockey, it applies to life, business, virtually every endeavor man sets his mind to.

Which brings us to the wonderful world of retail selling, which can be broken down into two basic categories: the salesperson who works off commission only or salary versus commission and the salesperson that works off a straight wage. 

We will be focusing our attention more on the latter of the two because the first category of salesperson has its own incentive built into the job.  The more you sell, the more money you make. There are, though, a great many more people working in the latter category and it is frustrating for managers or owners who have a host of “cashiers” working their sales floor instead of “salespeople”. Converting your cashiers into salespeople is not as difficult as you might think.

It starts with seeing your operation from the point of view of your customer.  What are they buying, what are they not buying, and why? What are some of your low cost/high profit items and where are they being placed in the store?  Is your staff being taught the difference between mechanically asking each customer “is that all?” or “did you find everything okay?” and the art of sizing up each purchase and suggesting something that naturally goes along with that purchase that would suit the customer’s needs better -  Thereby actually improving the customer experience? Think about it.  If I’m a customer and I’m making a purchase, I want what’s best for me. If your salespeople are being taught how to have that interaction with the customer, than your sales and profits will increase, and your costs will go down.

First, I’ll give an example of a nationwide fast service “home-style” restaurant that uses a technique that enhances the customer’s choices and increases many of the sales simply by wording a question in a certain way. I know, I know, this is for retailer’s, but I’m a restauranteur at heart and can’t pass up the opportunity to share best practices. Then, I’ll illustrate a success from my own experience in retail that demonstrates just one area of this concept that dramatically improved the sale of a particular item.

Several years ago, my family and I visited a nationwide restaurant for the first time. They pride themselves on home-cooked “comfort food” which is right up our alley.  Now when you purchase an entree at this particular restaurant, you automatically get two sides with it. However, for about a dollar more, you can add a third side and since there are so many sides to choose from and they’re all showcased right there in front of you, this is sort of a no-brainer, but the customer is literally walked into purchasing that third side, and here’s how they do it. The customer may or may not know that they automatically get two sides with their entree, but when they order, the salesperson asks would you like three sides with that or just two? They don’t mention anything about the cost of the third side, or that the two sides automatically come with the entree.  Of course, I immediately said “three” along with most of the rest of my family, increasing the check by about $4.00. We were happy, because we were given an option that was phrased in simple terms, which we might not otherwise have been aware of,  we got a delicious extra side dish and it wasn’t that much more expensive. Of course, the salesperson was happy, because he just made an extra $4.00 on the guest check simply by the way he phrased the question: “Would you like three sides with that or just two?”  Implying that “just two” was not enough and three was better.  His tone, inflection, everything about the presentation was sincere.  As I waited for our order to be filled, I watched as this salesperson performed his magic on the next three customers in line and they all took the bait!  In that short span of time, that well-trained salesperson had increased the revenue of that restaurant by about $20.00.  Imagine if that was going on every order every day. How much extra revenue was that single salesperson generating for his restaurant? Assuming he only does it four times per day, working 4 shifts per week, that salesperson alone has added $4160 straight to the top line.  But of course I’m sure he’s doing it all day long because he has been properly trained! Let’s assume that we’ve got three salespeople on that shift selling that way to only four orders - now we’re talking serious dollars. This equates to $12,480 straight to the top. Now, let’s assume this manager has a whole host of salespeople. As a matter of fact he has insisted, through proper modeling, mentoring and training that all of his front line crew were salespeople. Let’s lowball our estimate by assuming that just 20 orders per day by seven salespeople are being sold that extra side. $29,120 straight to your top line. Wow! That sounds good to me.

Okay, I promised I’d get to a scenario in retail sales.  This is a simple yet dramatic example of how easily you can increase revenue by simply retraining your cashiers.  Some years back, I was working as a field manager for a chain of convenience stores/gas stations. I’ll give you just one illustration where “You miss 100% of the shots you don’t take,” started improving sales for one store almost from the very first day. I observed from the P&L that cigarette sales at this store were extraordinarily high in comparison to other units in the chain. I also observed that the lighters were tucked back in a corner, where the customers had to literally strain to see them.  Right next to the cigarettes was a failing phone card promotion. I looked at the cost on the lighters and it was .39. We sold them for $1.19.  A profit of .80 was being made on each lighter sold.  Yet the display sat tucked in a corner where no one even knew they existed. 

I asked one of the shift supervisors why the lighters had been placed so far out of reach and view of the customer?  They replied it was due to theft. I thought that this was a valid reason, but still not an excuse for hiding them.  With permission from the store manager, we moved the lighters into the prominent area of the failing phone card promotion, next to the cigarettes, and moved the phone cards to a place of prominence on the floor. They didn’t need to be behind the registers because they had to be activated in order to be of use and that had to be done by the cashier at the register. If one of the plastic cards was stolen, it did not reflect on the shrinkage of the store.

I then asked everyone who was working the registers to recommend a lighter with every pack of cigarettes sold. Simply say something like this as you’re reaching for the cigarettes and the lighter display. “Do you need a lighter with that?  We have red, blue, green and yellow.  Which would you like?” I tracked the sales of the disposable lighters for one month and they improved exponentially. On average, the store was now selling about 15 more lighters per day.  You might think, “Well, Shawn, that’s no big deal, it’s just a $1.19 item.”  True, but with an .80 margin. Supposing the trend continued, which it did as long as I followed it, the store brought it an extra $6515.25 per year directly to the top line, $4380 of which was pure profit.

This particular outfit had 13 total stores so let’s just assume that was reproduced at all thirteen locations, we’re now talking about $84,659.25 right to the top, $56,940 in profit to the overall operation. Just from learning how to offer lighters to cigarette smokers! Amazing! Why an operator would not be jumping on this yesterday is beyond me.

I’m not reinventing the wheel here.  Of course, there were some employees who were more flexible and teachable than others, but once the concept of salesmanship was introduced to the unit, all sorts of changes began to occur. Basically, though, we found that from the lighter experiment, if you took away the matches ( a no profit item) and asked every single customer if they needed a lighter with their cigarettes, MOST said yes. We found that you do indeed, miss 100% of the shots you don’t take.

Until next time... Shawn

Here are the TIPS articles from 2007 that may help you and your organization to achieve your desired results!

Your Servers- Salespeople or Order Takers?
WRAP UP

Your Servers- Salespeople or Order Takers?
PART THREE

Your Servers-Salespeople or Order Takers?
PART TWO

Your Servers-Salespeople or Order Takers?

Setting Goals for Your Organization and Measuring Them Properly

More ways to maximize the effectiveness of your mystery shopping program

Missions & Values
Core principles to get you moving in the direction you want to go!

The Power of YES

IDENTIFYING AND RESOLVING BARTENDER THEFT

Leadership vs. Management

SMILE! It’s catchy!

Nine ways to maximize the effectiveness of your mystery shopping program
 

© Aloha Solutions, LLC 2003-2008