Consider Adding Categories to Increase Sales
This may come as a surprise to some of you but the largest increase in sales for independent shoe retailers in the past few years did not come from sandals or even booties but from non-footwear items. According to NSRA’s 2016-2017 BPR report “sales of non-footwear items in a typical store increased 24.5% in 2015.” Let me translate. For a store doing my keyword000000 in sales non-footwear sales are now close to $250000. This is an increase of over 9% since the previous BPR report. In my dealings with shoe merchants I often find this area of the business neglected and therefore underperforming.
Items Typically Associated with Non-Footwear Sales
- Socks
- Handbags
- Insoles and arch supports
- Shoe care products
- Belts
- Jewelry
- Apparel
Most of these items have some commonality that make them attractive add-on sales; they all have good initial markups don’t require much space on the sales floor and turn faster than footwear if managed properly.
Since nearly one quarter of a shoe store’s sales volume can potentially come from non-footwear items it makes sense to reevaluate how these areas are being treated in the store. Most shoe stores carry socks and shoe care products and some even dabble in over-the-counter arch supports. What I find however is that these areas are dealt with in many instances as an afterthought instead of the revenue centers that they should be.
Let’s Take Socks for Instance
This to me is a no-brainer. Every customer who purchases a pair of shoes should be at the very least afforded the opportunity to buy a new pair of socks. One might argue that to not offer the customer socks with a pair of new boots or shoes is potentially doing the customer a disservice.
The hiking running and ski socks of today are so technologically superior than in previous years that there is much information from which to educate the customer. Patterned socks for both men and women also come into play and most definitely should be part of the assortment plan.
If the potential sales volume isn’t enough to convince you then perhaps the increased GMROI is. On average the GMROI for shoes is around 2. The GMROI for socks should be at least 3 and can achieve 4 depending on the margin and turns attained. This point alone should be a motivator to develop this category.
Brush Up on the Selling Skills
Non-footwear items do require salesmanship. Good salesmanship begins with product knowledge. Vendors can be helpful here by providing training clinics and samples to sales associates when practical. Foot scans can be useful in selling arch supports and insoles. However they don’t do you much good if the scanners are kept in the back and no one understands how to use them.
Sales contests are a great way to get associates showing and selling accessories. Discuss new accessories with them at staff meetings. Shoe care products and insoles have many benefits socks and apparel have features that should be understood and discussed.
Visual Merchandising
Visual merchandising is also an important component in order to be successful with accessories. They must be easily accessible effectively displayed and well stocked at all times.
Case Study
Client Success Story
I have a current client that we have worked with for many years. They started as a women’s shoe store exclusively and about 6 years into the business decided to try a limited “test” of women’s apparel.
To make a long story short I can tell you that without the significant contribution of apparel this store would most likely not exist today. Reason… apparel now constitutes 75% of the revenue with a GMROI of 4.2 while the shoe department makes up the balance with a GMROI of 2.03. Reason being…faster turn fewer sizes to contend with more frequent visits to the store additional customer base. I could go on.
Competing with Online Retailers
As independent retailers struggle with ways to compete with online competition remember to consider any classifications of merchandise that augment the current assortment add interest and diversity to the presentation and offer more choices to the customers.
Ritchie Sayner
Summary
Independent shoe retailers have seen significant sales growth from non-footwear items such as socks and handbags which now constitute nearly a quarter of sales. These items offer high markups and faster turnover suggesting that stores should treat them as essential revenue centers rather than afterthoughts. A client success story highlights how diversifying into apparel significantly boosted revenue emphasizing the importance of expanding product categories to compete with online retailers.
“Sales of non-footwear items in a typical store increased 24.5% in 2015.”
Real-World Examples of Adding Categories to Increase Sales
Here are a few examples of how businesses have successfully expanded their product categories to boost sales by incorporating non-core items.
- A local shoe store began offering a selection of high-quality socks alongside their footwear. By training staff to educate customers on the benefits of these socks they increased their average transaction value and improved customer satisfaction.
- An independent bookstore introduced a range of stationery and gift items such as journals and greeting cards. This not only diversified their product range but also attracted new customers looking for unique gifts thereby increasing foot traffic and sales.
- A boutique that originally focused on women’s clothing expanded to include jewelry and handbags. By creating visually appealing displays and promoting these items through social media they were able to capture a larger share of their customers’ accessory spending.
