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Grocery Store Accounting - Complete Controller

A grocery store refers to a retail trade in which the sale of food products is carried out directly to the consumer to meet personal needs. Bookkeeping in a local grocery store can be a challenging task at times. Sales in the store, which is a stationary outlet, are processed by issuing a cash receipt for the purchase, reflecting the purchase amount. After the verifications from the cash register, the cashier enters the amount of the daily revenue in the cashier-operator book. Every day, information from this journal should be recorded in bookkeeping entries that reflect the daily income received from the sale of food products.

Bookkeeping in the grocery store should be conducted based on the correct combination of synthetic and analytical accounting. Synthetic accounting should be maintained in the “sales” section. In the column “credit” of this account, the selling price of the goods sold, including VAT (Value added tax), is reflected. The column “Debit” indicates: Check out America's Best Bookkeepers

  • Expenses for the procurement of goods
  • Expenses for the organization of trading activities
  • The amount of VAT
  • Excises

At the end of each month, the store bookkeeper must enter all this information into the bookkeeping documents and write the expenses from the total amount of revenue received to determine the amount of the monthly gross income from retail food. The specifics of determining the number of write-offs and gross profit will depend on the methods of valuing commodity stocks, which can be carried out at purchasing or sales rates. Check out America's Best Bookkeepers

Operations of sales accounting when determining the purchase price for purchase prices

When organizing a retail sale of products, the consumer does not prepare invoices for goods that indicate the purchase price of the goods sold and its quantity in keeping records of transactions. When determining the discount price, a bookkeeper must compose a formula that will allow him to make calculations necessary for bookkeeping.

The total value of sold goods is calculated by summing the commodity balance in the accounting prices at the beginning of the month, and the accounting prices’ received goods during the reporting period. From the obtained result, it is necessary to subtract the balance of the commodity mass in the accounting prices, formed at the end of the reporting period.

 

To determine the accounting prices of incoming goods, the bookkeeper must use the primary accounting documentation based on which the inbound goods are accepted. The balance of accounting is determined by using an inventory, or a procedure for removing balances. Inventory is carried out at the end of the month. This is so that the balance at the end of the reporting month always corresponds to the balance of the next reporting period at the time of its commencement. Check out America's Best Bookkeepers

Features of accounting for goods at retail rates

The bookkeeping for calculating the total monthly income of a retail outlet at retail prices is done more simply by using computer technologies, barcodes, and scanners that accept digitized information about goods. With the help of such digital technologies, automation of the sales process is carried out. In the end, the manufacturer uses a barcode on the product packaging. This barcode contains all the necessary information about the product, the manufacturer, the seller, and the commodity characteristics.

When accepting goods, employees enter all this information into the store database using a unique reading scanner. If the product does not have a barcode, you have to enter data into the computer manually. When buying goods, the cashier can read all the information reflected in the final check in the form of the total daily revenue received from the sale of products at discount prices.

At the end of the month, the store bookkeeper must draw up an initial balance sheet and compare the credit and debit turnover amounts received on the synthetic account. Calculation of the high cost of the commodity figure is carried out when using sales prices as discount prices, and it is carried out by subtracting the trade markup on the goods sold from the selling price.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
ecommerce or brick and mortar - Complete Controller

There is no doubt that online retail shopping is catching an ever grown share of consumer spending currency. The advent and growth of e-commerce in the market industry have brought endless choices, price efficiency, and convenience. All these components are powerful for the consumer’s decision-making criteria. E-commerce has become more efficient in buying products and continue to find ways to deliver commodities more cheaply and quickly. 

Despite all the successes of the e-commerce industry, it falls short of delivering unique and qualitative experiences for retailers and consumers. People’s ability to interact socially with the outside physical world has steered their shopping behavior. They have become much more reluctant to give it up. Check out America's Best Bookkeepers

Taking chances in social experience into consideration, it is reshaping consumers’ expectations. Nowhere is this concept more evident than shopping malls that have covered significant ground surfaces of modern cities. Places such as hotels, entertainment venues, or academics have started backfilling vacant spaces previously occupied by traditional departmental stores to create a more offering. Restaurants are at the forefront of opting for a role in this transformation. As a result, total restaurant sales have exceeded the sales of grocery stores. 

In the same way, real estate investors are also adapting to this changing environment by rethinking the structure and flow of shopping centers. In these circumstances, the use of Artificial Intelligence (AI) makes the market economy more efficient at a full pace. Vast acres of parking stalls used for vehicles are soon replaced by smaller and efficient queues for autonomous vehicles into interactive space for sales.

According to a report released by Forbes, the total retail sales from the e-commerce industry are rising since 2010. According to reports, the sector had generated over 73.2 billion since then. Despite this success, brick and mortar are still doing much better in the retail world by witnessing 94% of all retail sales. Other reports stated that most global populace, or about 75%, is more conducive towards shopping in brick and mortar stores.

One of the surveys named ‘Retail Drive’ asked as much as 1500 consumers what makes them opt for the physical store for shopping? The most crucial reason they cited them was the ability to feel, see, and try out the purchasing item. Besides, another drive for physical shopping is prompt gratification. Having a retailer available for assistance is not an essential draw to shop in brick and mortar stores. More significant is the experience of in-store shopping, especially for consumers under 35. Check out America's Best Bookkeepers

Reason for Choosing Online Shopping

While prompt gratification may incline consumers to a physical store, convenience is what draws them online retailing.

Being able to shop at any point in time or anywhere is a significant encourager that generates more than $295 billion in a single year. With this percentage expected to rise to $420 billion by the year 2018, the ability to shop even at midnight hours is an essential consideration for several shoppers.

More consumers tired of the hassle shopping at stores, such as standing in a long queue or dealing with the overwhelming crowd at shopping centers, as a reason for them to turn to online retailing for purchasing items like clothes, electronic appliances, etc. Especially business persons who immediately need to have all essential business items such as bookkeeping details for financial records. Another area to decide on purchasing online is the shipping procedure. Consumers tend to buy from an e-retailer that offers free shipping and return.

Which industry Pays more Attention to the Demand? Check out America's Best Bookkeepers

The opportunities for brick and mortar markets do not negate the issues and challenges e-commerce channels intermittently face. Mismanaged inventory, coupled with predicting demands, lead to a decreasing sense of convenience and customer service.

Those brick and mortar stores that are yearning to compete with their online retail counterparts, forestalling the demands that retreat them from offering promised convenience is the key.

Who is the Winner?

Different consumers have different preferences for shopping or payment. Some of them solely enjoy the efficiency that online retail offers through its rapid delivery service. In contrast, many others continue to applaud the physical presence of a business along with their capability to get what they want in a person. No one can overtake another, which is why it is beneficial and convenient for the business industry to regard multiple ways of paying or shopping, referred to as ‘Omni commerce’.

 

 

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
brick and mortar retail - Complete Controller

Suppose the retailers have been paying attention to business headlines. In that case, they might have heard that traditional retailing of brick and mortar vanishes. In the past couple of years, a heap of retailers witnessed the closing down of stores across many regions. The evolution of online retail shopping seems to have finally put the in-store retail facility out of business. 

According to the data released by the National Retail Foundation, several physical retail stores in the US have grown at a rate of 3.2 new stores per store that previously closed. Also, online retail sales out of total sales have evolved over the last couple of years, increasing from 4.6% in 2014 to 7.4% in the third quarter of 2016, according to the Census Bureau report.  Check out America's Best Bookkeepers

Suppose the online shopping is the relentless wave of the future. Why are several online retailers like Amazon, Rent, and Runway and others conducive to open brick and mortar stores? Transformations in retail shopping have been a witness before.

There are two main types of shopping, i.e., chore and cherish. The former is shopping for essential items. For instance, each household has a tariff on things to buy every month. Customers are willing to get chore shopping as quickly as possible. Thus, many of them have turned towards online retail shopping that is both hassle-free and quality-driven. Online retailers offer quick and easy options for recurring purchases. Online services like same-day delivery service or voice-assisted ordering facility for buying grocery, electronic, bookkeeping, or other products make the online process more convenient for customers. This convenience is especially so for those who are reluctant to leave their homes and cross miles to buy a handful of items.

Besides, another type of shopping, namely ‘cherish,’ takes place when customers spend time looking for high-quality products and cherishing the process of browsing through online platforms to buy goods. Consumers do not necessarily need those items but still content with buying, such as stylish furniture or designer clothing, leading to cherish shopping. These experiences in shopping are difficult to replicate online. Even buying clothes through online retail websites are a skeptical process. Consumers do not feel sure about the color, size, or quality of the product they buy online. Consumers cannot handle the fabric or compare two clothing items when shopping online. E-commerce stores have appeared to fall short on delivering cherish shopping experiences. Here the brick and mortar stores perform most reliably. Check out America's Best Bookkeepers

Every aspect of in-store shopping cannot be replaced by online shopping, at least not to the date. Market observers have recommended that small retail stores need to put their focus on offering affordable cherish shopping experience to remain at the forefront of market competition.

Physical Stores Play a Role of Brand Ambassadors

Just like movies use a trailer to attract movie-goers towards the cinemas, retail stores attract customers with their aesthetic structure and ability to establish a sensorial experience. Remember that display always makes products look more desirable to purchase.

Despite the enhancement of more online retail shopping, the human touch still appears to be good for the business. Pepperfry, one of the Indian online furniture retailers, reported that almost 25% of online purchases came from customer experience with the offline store. The key benefit of such a store is that buying products can be curated.

A Unique Experience Check out America's Best Bookkeepers

Several retail stores are innovating to transform themselves into go-to-destinations, in an assiduity to draw consumers into the store. Personalization continues to be a wild goose chase in retail-consumers expect highly personalized experiences. Automating personalized experience for in-store benefits retailers as well as consumers.

For those consumers who are unable to handle the monumental burden of entering a store and buying a product despite being reluctant, Amazon and other online retail websites have covered consumers with their new pickups. However, such online retail sites sometimes become compelled to resort to the physical presence of the store, keeping in view the growing susceptibility in customers. One of China’s largest online retailers, Alibaba, bought two physical retail shops in 2017. On the other hand, Walmart, located in China, has invested in JD.com to profit its products. Such a change in retailers’ mindset makes the fact evident that the physical presence of a retail store is indispensable to sustain the credibility of long-lasting customers.

Therefore, the future of shopping will remain to be at both ends, online and in person. However, the latter will remain a credible and perpetual platform for purchasing goods, owing to its more acceptability. 

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
grocery store - Complete Controller

Retail Trade Network

A trading network of the local grocery store is a set of trading enterprises located within a particular territory or under joint management.

The local grocery store provides the opportunity to quickly and conveniently acquire the necessary goods and services with minimum effort and time in the conditions of free choice from a variety, near the place of work and housing, in convenient quantities.

Retail trade of grocery store network performs the following functions: purchase, transportation, storage, sub-sorting, part-time, bringing to market, selling goods, accepting the risk, financial activities, informing the market, obtaining information about the market.

The retail enterprise of grocery stores carries out the purchase and sale of goods to deliver the necessary services to customers. Check out America's Best Bookkeepers

Local Grocery store and its problems

A store is a specially equipped in-house building or part of it that is intended for the sale of goods and services to customers and provided with trade and all necessary auxiliary, administrative and domestic premises, as well as premises for receiving, storing and preparing products for sale.

There are universal, specialized shops, shops that offer a mixed assortment of goods.

Universal store (department store) – a store with an unlimited range of non-food items and a department of food products. For this kind of grocery store, controlling the operational costs can be the biggest challenge.

Supermarket – a self-service store with a universal assortment of food products and a limited range of non-food items of daily demand. The most common problem of the supermarket is time wastage, the strain on the working employees, and less efficient software. Therefore, the inefficient process is one of the biggest challenges of this type of grocery store. Check out America's Best Bookkeepers

Hypermarket a store is selling both luxury goods and consumer goods, with an emphasis on essential consumer goods and food. Managers of such grocery stores cannot understand the inventory process. What to deliver, where to deliver, and what time to deliver?

A specialized store is a retail enterprise that sells one group of goods or a subgroup of the products.

A grocery store with a combined assortment of goods is a retail enterprise that sells several products connected by common demand and satisfying individual needs. The enterprises of this type include “Goods for Children,” “Household Goods,” “Goods for Leisure,” “Fruits and vegetables,” “Makeup and Jewelry,” etc.

Principles of a Grocery Store

The difference between the supermarket and the Hypermarket is noticeable. The supermarket is a large department store with the self-service technology and sale of goods through the cash register. The challenge for a grocery store can be a considerable number of people shopping daily. The average number of customers in one supermarket chain is 3,500 people per day.

The Pricing and space Issue

Grocery stores that are of “Premium” class can face many pricing, discount, and space challenges.  The spaces of such grocery stores do not exceed 2 thousand square meters, and in their variety, there are up to 20 thousand items. Here are essential food products plus a minimum amount of vegetables and fruits, a small selection of alcohol, meat, and fish. But the main difference from discounters, in this case, is the price. The trade markup to wholesale prices in the economy class supermarkets is 30% – 40%. Check out America's Best Bookkeepers

 

Retail network of grocery stores is characterized by:

 

  • the ratio of grocery store enterprises engaged in trade in food and non-food products
  • the specific gravity of the fixed network in the total number of grocery store enterprises
  • the specific weight of specialized grocery stores in the total number of trade enterprises
  • used forms of sale and methods of service
  • the ratio of retail space used for the implementation of certain groups of goods
  • the ratio of trade and non-trading areas of the grocery store
  • duration of use of the working area during the day (mode of operation)
  • the ratio of parts of the total area of ​​a grocery store trading enterprise
  • the specific gravity of grocery stores provided with refrigeration equipment, including those that trade in perishable goods
  • the average size of the sales area of ​​a single grocery store
Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
brick and mortar retail - Complete Controller

The retail market landscape has significantly changed over time due to the digitalization of shopping and the shifting in consumers’ buying behavior. Presently, consumers have a low level of attention spans, use peer recommendations, and conduct comprehensive research before resorting to making purchases.

Establishing a unified and seamless experience between brick and mortar and digital channels gives market retailers a competitive advantage in the world’s present digital economy. Transformations in the digital era have created current opportunities for traditional retailers to make the overall shopping experience better for customers. Several retail chains pin their hopes on seasons of sales and struggle when sales results fail to live up to their expectations. Check out America's Best Bookkeepers

Perils of Commodity Sellers

Retailers appear to be most in peril selling commodities. For example, music shops that sell DVDs and discs in Blu-ray format, while selling in the shop can also sell them online. Consumers have become far savvier about buying products conveniently. Unless retailers selling in a brick and mortar retail shops adapt to selling online, they will go out of business.

Shop, Mobile, and Online

The comparison of mobiles, online platforms, and retail shop access for the people looking for purchasing something they often research for by accessing online sources and checking the latest prices of mobiles and other electronic gadgets, and they prefer to go for shopping. This transformation is something people have got used to it. Check out America's Best Bookkeepers

Developing away from Commodity Selling

There is no need to evolve away from selling commodities. Many retail shops that survive for a long time are that those that sell specialty items. For instance, the comic book shops which contain rare editions at premium prices will likely survive in the long term because they have limited, one of a kind commodities.

While selling these types of items online is possible, many buyers want to see them in person.

But, retailers who are dealing with the growing digital era should accept that many products can be bought online instead of compelling the consumer to purchase the products in person. While the prices may not be lower when selling in postage or packaging, for consumers getting free shipping service via Alibaba or Amazon, it will be tougher to match their prices. Retailers are supposed to provide a friendly retail environment and useful online experiences to meet the customers’ demands whenever they decide to lock down the sale.

Both Amazon and Walmart are realizing that the future state of global retail commerce, both offline and online, is more than merely a world of distribution hegemony, where every kind of brand has been reduced to conforming products and always at low prices. Check out America's Best Bookkeepers

Present Scenario

What makes the situation a bit more difficult is the fact that people live in a vacuum. Traditional retail in the present circumstances needs to pick the best location for establishing stores, keep up with consumers’ expectations about what the experience of in-store should be, and get more good at e-commerce strategies.

Therefore, rather than concentrating merely on one channel, market retail shops need to shift their focus to optimizing their physical store portfolios. Meanwhile, they should improve their online presence by keeping savvy employees who can expertly handle online platform. Also, retailers need to adjust how they view the value of their physical stores.

Brick and mortar retail stores make capture sales in today’s market. However, they also need to create values by advancing towards digital online sales. It means that the value of a particular store for retailers and consumers is higher than the sales they captured within them. Thus, just as consumers’ shopping behavior has changed over time, the sales and value needs of retailers also need to evolve, so that both the consumers’ easiness and retailers’ sales targets go hand in hand with each other by leaps and bounds.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
boutique retail store - Complete Controller

It is essential to know that boutique business financing is not only necessary only at the initial stage. But, one will have to keep the record of money transactions carried out during the whole period of the activity and be capable of examining their efficiency and requirements. Additional boutique business financing helps the enterprise in surviving the crisis moments without any unique problems. First of all, determine the essential funds for the effective operation of the boutique retail business. However, it is crucial to keep in mind that you have to adjust the plan for your boutique retail business and financing more than once. Check out America's Best Bookkeepers

What are the sources of boutique retail business financing?

  • Income from the sale of shares.
  • Profit from the activities of the boutique retail shop.

If the boutique retail shop already gives profit to its owners, then after a while, the boutique business will still have to be extended, but for this purpose, only net profit will be insufficient.

Retail business financing

Boutique retail business financing is said to be the receipt of additional funds to the enterprise. To successfully develop your retail boutique business, you need to be able to find the money for it. The main reason for the collapse of any retail boutique business is the lack of free cash. Before considering the financing of the current retail boutique business, it is essential to know how the retail financing process in the boutique business plan is reflected. Check out America's Best Bookkeepers

The last section of any boutique retail business plan is always a financial plan. It carries information, extremely important for the future enterprise and potential creditors (investors) of the retail business project. The form and content of the boutique retail shop’s financial plan always depend on the contact audience, which will read this business plan in the future. The financial plan is drawn up to identify the sources of business financing and analyze the ratio of the revenue and expenditure side of the funds raised. To achieve this goal, when preparing a financial plan for your boutique retail shop, it is essential to:

 

  • Find out the conditions for obtaining maximum profit for the boutique business
  • To optimize the capital structure to achieve financial stability of the boutique retail shop
  • Create an investment attractiveness for the retail boutique
  • To develop an effective mechanism for financial management through tax
  • Accounting
  • Dividend
  • Credit and depreciation policies of the boutique

 

Plan of incomes and expenses

 With the help of income and expenses plan for the boutique, you can determine the size, sources of creation, and changes in the financial result from the retail boutique’s activities. With this plan’s help, the boutique retail business can identify its profitability, profitability, production and non-production costs, and forecast net profit. For keeping the financial records, bookkeeping can be used. Check out America's Best Bookkeepers

 

The plan of cash receipts and payments

This plan helps to determine the liquidity of the boutique. The movement of cash depends on the characteristics of the boutique’s activities and the discrepancies between the periods of receipt and cash disposition. It is essential to understand the differences between the movement of financial flows that do not lead to cash flow and the expenditure of clean cash. The first includes devaluation and special funds, and the second consists of:

  • Proceeds from the sale of clothes and services
  • Advances received, funds from the sale of securities that are fixed assets
  • Financial investments
  • Loans and credit.

 

Plan for the sources and use of funds

It is compiled to describe the sources of receipt of funds, their use, and changes in the retail boutique shop’s assets in a particular period. It allows you to establish a link between the projected sources of funds and negotiable sources. With its help, the boutique’s managers and likely investors have the opportunity to analyze the boutique’s financial condition and the effectiveness of its fiscal policies and economic performance.

 

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
retail store - Complete Controller

Small retail business

Owning a small retail business can be difficult. One can likely feel it is impossible to keep up with consumer demands because of the increasing competition in the online business sector. Small retailers have to face financing pressure and marketing challenges.

A small retail business is a set of entrepreneurial activities that involve the sale of goods directly to the customer. Small Retail business can take place in a variety of forms, for example, in personal sales, trade-in specially designated areas, or through communications (Internet, TV). Check out America's Best Bookkeepers

A small retailer should be able to perform the following functions.

  • To organize active commodity circulation to points of sales.
  • Form stocks of products and maintain them at the required level.
  • Produce trade and technological operations with the goods.
  • Stimulate sales through marketing activities.
  • Investigate the demand for a particular product and analyze the level of the current market supply. The market price depends on the relationship between supply and demand.
  • Analyze the effectiveness of various forms of trade and focus on the most effective.
  • Organize a service that facilitates the buyer’s purchase of goods (for example, accepting applications by phone, credit offers).
  • Improve the methods of trade and regularly improve professionals’ skills working directly with the buyer (through training, master classes). Check out America's Best Bookkeepers

Problems Faced by Small Retail Businesses

The retail sector is vital for the country’s economy, represented by a large number of enterprises, mainly small and medium-sized businesses. Small retail businesses usually face many problems that are difficult to solve alone. Starting with the location and attracting the buyer to it and ending with the issues of personnel management. The owners of small retail businesses sometimes do not have the critical information they need to carry out commercial activities and planning for long-term retail business development.

If you own a small retail business, you must be struggling with many challenges and consequences. The top five problems that a retail small business owner consistently face are:

  • 40% of unsold goods occupy an essential place in the warehouse of small retail businesses.
  • The funds invested in unsold goods settle in the form of unclaimed stuff.
  • The market associated with clothing and footwear is dynamic, which means it focuses on changing fashion trends. The value of a fashionable product falls with each month, often the term “peak” value is calculated in weeks. As a consequence, the small retail business faces a progressive increase in losses.
  • The mechanisms of discount and sales systems are still a mystery for the small retail businessman.
  • “Floating” quantity of the goods in the warehouse, as a result of imperfect accounting systems, leads to bookkeeping’s impossibility for “conserved” money. Check out America's Best Bookkeepers

 

In addition to this, the inability to cope with problems prevents retail outlets of small retail businesses such as clothing and footwear from pursuing a more flexible and efficient assortment policy. The overcrowded warehouse and lack of available funds in the small retail stores are some of the most common problems. Customer loyalty largely depends on the constant presentation of the current fashion collections. The small retailers are unable to afford them usually.

 

Another problem in small retail businesses is the lack of attention to regular customers. The modern consumer focuses on the quality of service and the personal attention paid to him. The current urban environment, depersonalized and indifferent, needs compensation. A good entrepreneur provides such benefits as an individual approach to every potential customer.

The owners of the small retail business should be able to maintain a good sense of the products that they have in stock. They must know where their inventory is low and how they can improve it. Due to limited funds and space, keeping the inventory well-organized and well-stocked can be difficult for the retail small business owners.

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers
brick and mortar stores - Complete Controller

Booming E-commerce is making the in-store business increasingly difficult. More customers order consumer electronics, clothing, accessories, and much more on the Internet and can conveniently have goods delivered or sometimes pick them up at the store. Shopping has become a popular pastime in our society, enabling online commerce around the clock. Despite the well-stocked department and retail stores, more and more goods are purchased online. Check out America's Best Bookkeepers

These favorable conditions alone are not enough for the success of online trading. Those online businesses who rely on self-service and staff reduction risk dissatisfaction among their customers. The strongest customer loyalty driver this year is the quality of the request processing via telephone or e-mail. The Internet buyer expects a straightforward return process and a quick and easy refund or settlement of the sale amount. Approximately 58% of customers feel that the shipping costs are too high, and, in this regard, brick-and-mortar retail can again score more points. To keep up with the high standard of service offered by online retailers, storefront retailers should always be courteous with complaints and returns. A misstep could cause the customer to migrate to e-commerce. Check out America's Best Bookkeepers

 

The sales force is often mentioned as an effective means of re-launching the success of brick-and-mortar retailing. This cannot be refuted since an online shop does not offer face-to-face contact and offer advice proactively. For the seller, the transaction is in the foreground, for the customer, often the advice. The buyer is thus, forced into a situation that makes it almost impossible to escape the sales situation without having made a purchase. With online shopping, there is no pressure, and this can attract customers who want a hassle-free buying experience.

 

For brick-and-mortar retail, it is becoming increasingly difficult to counter e-commerce – despite the potential for improvement that exists here as well. Stationary trade should, therefore, no longer consider itself separately from online trading but accept the challenge. This is not to perceive online trading as a separate sales channel, but to understand it as an opportunity for a further sales channel to tap into the maximum customer potential. Retailers should, therefore, not rely exclusively on their local customer service representatives but jump on the train of “Omni-channeling” and offer their goods on different distribution channels or at least be present there. This is of great importance in the wake of customers’ increasing cross-channel behavior, as many consumers first seek information on the Internet before they visit the office. Check out America's Best Bookkeepers

 

The trend towards “multi-channeling’ makes clear that customers want their dealers to have close interaction between both distribution channels. The future of brick-and-mortar retailing is not to hide the opportunities of e-commerce but to include them. E-commerce and stationary trade is a relationship with the future that handles delivering a consistent and coherent brand experience across distribution channels. It also delivers consistent customer experience. All activities across the channels should also be networked to end competitive advantage. Stationary retailing should continue to create sales experiences with the atmosphere in the stores. In the online trade, the clarity of the shop, as well as the availability of employees across all industries, are among the strongest customer loyalty drivers. From the customer’s point of view, and in addition, high-quality content should always be used when processing customer concerns, especially when exchanging.

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The closure of a couple of big retail chains expanded across the country doesn’t necessarily mean the death of the entire brick and mortar retail industry. It would be premature to build up this idea based off of a few reported cases of bankruptcy. One cannot follow the crowd and come up with a bold stance inspired by some industry veterans who believe,” it’s the end of brick and mortar retail stores.” Instead, you need to make a realistic analysis of the industry in the light of real facts.

What Do Stats Reveal About the Fate of Brick and Mortar Retail?

Ever-increasing online stores and e-commerce platforms with sales of billions of dollars each year can give us an illusion that brick and mortar retail is dying but believe you me, they can never die as long as the humans are alive. Online retail stores may have aggregated global sales of billions of dollars. Still, they can never match a multi-trillion-dollar brick and mortar retail industry, no matter what one may argue! From roadside small retail shops to big branded shops in malls and retail hubs, there are millions of brick and mortar retail stores all over the world that are present on the face of Earth, and they bear testimony to the fact that physical retail is not dying! Check out America's Best Bookkeepers

Brick and Mortar Retail is in The Safe Zone!

According to a study, 84% of the total products or commodities that are manufactured all across the globe are sold in brick and mortar retail stores. This indicates that online store or e-commerce has been able to grab a little percentage of the total market share and brick and mortar stores are still in the safe zone where they can reacquire what they have lost over the years.

That is going to be a challenge for the entire brick and mortar retail industry, and veterans believe, it might be impossible to regain the loss. Research that was conducted by a group of students concluded that you could prevent losing your brick and mortar market share to online competitors by making serious efforts to improving your in-house shopping experience. Getting your customers involved and navigating them to what they want surely ensures more sales and hence profitability. Check out America's Best Bookkeepers

Why the Retail Industry Experienced A Dramatic Shift?

With rising shoppers’ expectations, increased competitive pressures, the proliferation of data and evolving touchpoints, retailers need to come up with something new and must focus on delivering and elevating the overall customer experience if they expect to succeed in today’s highly competitive market. The reason why online stores have been able to grab a significant market share is due to evolving retail dynamics and changing industry patterns and preferences. Customers capitalized on easy-buying options at competitive rates and found convenience in purchasing their desired products online from their mobile devices. A significant shift from brick and mortar retail buying to online buying had shaken the industry to its core and made people believe that brick and mortar retail is dying. However, this wasn’t so!

What’s more?

Online retail giants such as Amazon, eBay, and Walmart that have operations all across the globe made it convenient for people to buy products at the hour of their choosing at discounted rates cheaper than the products offered in the brick and mortar retail stores. This significant gap made people think that online stores are cost-effective, and brick and mortar stores are exploiting them by charging more for the same products offered for sale on online stores. Online stores have some limitations such as loss of sensitive data, vendor details, and threats to cybersecurity, which limits the trust of some customers and drives them to brick and mortar stores despite the online discounts. Check out America's Best Bookkeepers

A Well-Crafted Illusion of Brick and Mortar Retail Dying

So, it makes me feel safe to say that online retailers or marketers have been quite successful in establishing an illusion that brick and mortar retail store is dying. Well, the concept is mostly exaggerated, and the physical retail is not dying no matter what. However, brick and mortar retail may witness a little breakdown in the market share in the upcoming years due to changing market dynamics and changing customer preferences, but it won’t completely die! If you don’t trust me, just trust the stats!

 

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The turnover is because the majority of the retail employees are students and people looking for extra money. Due to the nature of these jobs and these employees moving towards more promising and high-paying careers, a shift system is needed. Thus, the turnover, along with the growing demand for retail items, leads to a constant and high demand for retail workers, who are necessary for the basic operations, bookkeeping and customer handling at a retail store.

All this, however, doesn’t explain the need for shift change procedures in retail. Check out America's Best Bookkeepers

Retail workers are working on a temporary or part-time basis, and to efficiently manage this random bunch, a manager (or managers who themselves also work shifts sometimes) must execute a proper shift change procedure.

Another reason why shift change procedures are necessary, apart from the workers’ temporary or part-time jobs, is the fact that workers can’t be on their toes at all times. Any retail worker can’t cater to customers from the time the store opens till the time it closes, during the whole week. If a retail store is opened at 9 am, for example, and closed at 11 pm, then no worker or manager can work for 14 hours. Hence, the need for an efficient shift change procedure. If the shift change procedure is well-planned and executed, then there will be staff present at the retail store at all times, and their best.

In case an employee calls in sick, the manager will have to change shifts or call in someone else, as he/she will have a replacement or another employee to depend or fall back on. But, if there was no shift change system and the retail store had limited employees available at particular times, then the manager might have trouble finding someone to fill in. Or the store would have to be short-staffed, which might become a problem if a lot of customers come in at the same time. Check out America's Best Bookkeepers

The advantages of the shift change system:

  • No one is over-worked, so less chance of employees falling ill, and they will be in better spirits while dealing with customers.
  • The system is well-managed and leaves little room for error as an employee will have to complete a specific set of hours or shifts per week.
  • Staff will always be present at the retail store at all times due to the store having an amalgamation of temporary, permanent, and part-time employees.

The disadvantages of the shift change system:

  • There can be a lot of confusion when an employee calls in sick, and the manager has to switch all the shifts and check with everyone to see who is free and can take the shift.

These were the most widely recognized advantages and disadvantages of having shift change procedures in retail. But, even after viewing these, you won’t have a clear idea about what shift change procedures are. Better to have a look at the kinds of shift change systems that retail stores have the choice to use. Check out America's Best Bookkeepers

The shift changes in retail:

Five main kinds of shifts are being employed in retail, including morning shifts, mid-day shifts, and evening shifts. The other two kinds of shifts are the On-off work pattern, which entails employees working consecutively for days and then take the next couple of days off. The second kind is the schedule format, which can have fixed shifts and flex shifts. In fixed shifts, employees work on one shift (morning, evening, etc.) but different days. While in flex shifts, the employees can work in various shifts on different days, whichever is available to them. One thing that managers need to be careful about is to make sure that all employees fulfill their designated number of hours and given a fair number of shifts.

 

Check out America's Best Bookkeepers About Complete Controller® – America’s Bookkeeping Experts Complete Controller is the Nation’s Leader in virtual bookkeeping, providing service to businesses and households alike. Utilizing Complete Controller’s technology, clients gain access to a cloud-hosted desktop where their entire team and tax accountant may access the QuickBooks™️ file, critical financial documents, and back-office tools in an efficient and secure environment. Complete Controller’s team of certified US-based accounting professionals provide bookkeeping, record storage, performance reporting, and controller services including training, cash-flow management, budgeting and forecasting, process and controls advisement, and bill-pay. With flat-rate service plans, Complete Controller is the most cost-effective expert accounting solution for business, family-office, trusts, and households of any size or complexity. Check out America's Best Bookkeepers