STORE MANAGEMENT

Managing the Store

Store Layout, Design & Visual Merchandising

Customer Service Retail Selling

Managing the Store

Nordstrom for Store Managers

This is your business. Do your own thing. Dont listen to us in Seattle, listen to your customers. We give you permission to take care of your customers.
James Nordstrom, the CEO of Nordstroms

Responsibilites of Store Managers Undertaken by Store Managers

Managing Store Employees
John Recruiting & selecting Socializing & training Motivating Evaluating & providing constructive feedback Rewarding & compensating

Controlling Costs
Increasing labor and productivity Reducing maintenance & energy costs Reducing inventory losses

Managing Merchandise
Displaying merchandise & maintaining visual standards Working with buyers Suggesting new merchandise Buying merchandise Planning & managing special events Marking down merchandise

Providing Customer Service

Steps in the Employee Management Process

1. Recruit & select employees

2. Socialize & train new employees

3. Motivate & manage employees to achieve store performance goals

4. Evaluate employee performance & provide feedback

5. Compensate & reward employees

Recruiting and Selecting Employees

Job analysis Job description Locating prospects Screening applicants

- Application form, references, testing

Selecting applicants

- Interviewing candidates

Socializing and Training Employees

Orientation program

Training
- Where, when, what

Motivating and Managing Employees

Leadership - Task and group maintenance management Participate and authoritarian

Motivation

- Setting goals
- Maintaining morale

Evaluating and Providing Feedback to Employees

Evaluation - Who, when, how often? Feedback - Performance outcome vs. process

Factors Used to Evaluate Sales Associates at The Gap

25% Operations 25% Compliance

50% Sales/Customer Relations

Common Evaluation Errors

Ratings unduly negative

Rating unduly positive

Using the same rating on all aspects of the evaluation Placing too much weight on recent events rather than evaluating performance over the entire period Having the evaluation of a salesperson unduly influenced by the evaluation of other salespeople Making errors in identifying causes of the salespersons performance

Compensating and Rewarding Employees

Extrinsic vs. intrinsic rewards Compensation

- Type Straight salary Straight commission Salary plus commission Quota bonus (Setting quotas)
- Individual vs. group incentives

Advantages and Disadvantages of Straight Salary

Straight Salary
Offers flexibility in assigning employees to activities Builds stronger employee commitment Is easy for employees to understand

Incentive Compensation
Has high motivating potential

Has more variable cost Relates compensation to productivity

Is easy to administer
Allows for better performance of non-selling activities such as customer service

Controlling Costs

Labor scheduling

Store maintenance
Energy maintenance

Reducing inventory loss

Sources of Inventory Shrinkage

Employee theft (38%)

Shoplifting (36%)
Mistakes and inaccurate records (19%)

Vendor errors (6%)

Preventing Shoplifting

Store design

Employee training
Good customer service

- Security measures
- TV cameras - Prosecution

Reducing Employee Theft

Trusting, supportive work atmosphere Employee screening - Honesty, drug testing

Security personnel - mystery shoppers

Policies and procedures

Employee theft is an HR problem.

Store Layout, Design, and Visual Merchandising

Grid Store Layout

Receiving & storage
Fruit Books, magazines, seasonal display Checkouts Cart area Entrance Office & customer service Exit Vegetables

J.C. Penney Racetrack Layout at North Park Center in Dallas, Texas

Free-Form Layout
Storage, Receiving, Marketing

Underwear Stockings Accessories

Checkout counter

Casual Wear

Pants

Feature

Feature

Open Display Window

Open Display Window

Skirts and Dresses

Clearance Items

Jeans

Tops

Hats and Handbags

Dressing Rooms
Tops

Space Planning Issues

How profitable is the merchandise? How will the merchandise be displayed? What items does the retailer wish to emphasize? Will the location of certain merchandise draw the customer through the store?

Planogram for Salad Dressing

Merchandise Presentation Techniques

Idea-Oriented Presentation Style/Item Presentation Color Organization Price Lining

Vertical Merchandising
Tonnage Merchandising

Straight Rack

Rounder

Four-Way

Gondola

Customer Service

Services Offered by Retailers

Department and specialty store
Acceptance of credit cards Alteration of merchandise Child care facilities Credit Delivery to home

Discount stores

Demonstrations of merchandise
Displaying of merchandise Dressing rooms Extended store hours Extensive signage to identify merchandise

Services Offered by Retailers

Department and specialty store
Gift wrapping Facilities for shoppers with special needs (physically handicapped, etc.) Parking Personal assistance in selecting merchandise

Discount stores

Play areas for children

Presentations on how to use merchandise Repair services

Problems in Providing Quality Service

Intangibility of benefits - Difficult for customers to evaluate service quality - Difficult for firms to evaluate quality of service delivered by employees Inconsistencies of service provided - Employees are not machines

Customer Service Strategies

Customized

- Greater potential benefits to customers

- Greater inconsistency - Higher cost

Standardized
- Lower cost - High consistency - Meets but does not exceed expectations

Role of Expectations in Evaluating Retail Service

Service quality Perception of service delivered Satisfaction with service quality Past experiences Customer expectations Dissatisfaction with Competitive

service quality
Perception of service delivered

offerings

Cues Customers Use to Evaluate Retail Service Quality

TANGIBLES
Appearance of store
Display of merchandise Appearance of salespeople

CREDIBILITY
Reputation for honoring commitments
Trustworthiness of salespeople Guarantees & warranties provided Return policy

UNDERSTANDING & KNOWING CUSTOMER

Providing individual attention Recognizing regular customers

INFORMATION PROVIDED TO CUSTOMERS

Explanation of service & its cost Notes sent to customers informing them of sales Assurances that a problem will be resolved

SECURITY
Feeling safe in parking lot
Communications & transactions treated confidentially

Cues Customers Use to Evaluate Retail Service Quality

COURTESY
Friendliness of employees
Respect shown to customers Interest shown in customers

COMPETENCE
Knowledgeable & skillful employees
Customer questions answered

RESPONSIVENESS
Returning a customers call

ACCESS
Short waiting time to complete sales transaction
Convenient operating hours Convenient location Manager available to discuss problems

Giving prompt service

RELIABILITY
Accuracy in billing Performing service at designated time

Accuracy in completing sales transaction

The GAPS Model for Improving Service Quality

Knowledge gap

Management perceptions of customer expectations

Standards gap

Customer expectations

Service gap

Standards specifying service to be delivered

Delivery gap

Retailer communications about services

Communication gap

Actual service delivered

Customer perception of service

Closing the Knowledge GAP

Customer research

More interactions between managers and customers Better communications between managers and service providers

Closing the Standards GAP

High quality service commitment

Innovative solutions Define the role of service providers Set service goals

Measure service performance

Closing the Delivery GAP

Information and training

Internal communications
Reduce conflicts Empower employees Providing incentives

Closing the Communications GAP

Realistic commitments

Managing customer expectations

Service Recovery
Listen to the customer
Provide a fair solution Resolve problem quickly - Reduce number of contacts - Give clear instructions - Avoid jargon

Retail Selling

Steps in the Selling & Buying Process

1. Approaching the customers 2. Collecting Information

3. Presenting & demonstrating merchandise &

overcoming reservations

4. Making the sale 5. Building future sales

Steps in the Selling & Buying process

1. Problem recognition 2. Information search 3. Alternative evaluation 4. Alternative choice 5. Postpurchase evaluation

Selling Benefits, Not Features

PRESENTATION EMPHASIZING FEATURES This chinawear has a hard glaze that is applied after the pattern is on the cups and plates. The handles are molded into the cup before it is fired. All the china is fired at 2600 F.

PRESENTATION EMPHASIZING BENEFITS This chinawear will last a long time. It is stronger than most chinawear because it is fired at 2600 F. To prevent the cup handles from breaking off, they are molded into the cup body before it is fired. The pattern will also last a long time. It wont fade because a hard leadless glaze is applied over the pattern.

Types of Reservations
Store
I dont know about this stores return policy.

Timing
I havent made up my mind.

Location
I cant find it.

Merchandise
I dont think this is made well.

Salesperson
I dont like him.

Price
This is too expensive.

Building Relationships With a Customer

11-10-97 Dear Ms. Marker, It was a pleasure meeting you and assisting you with your sunglasses from our accessories dept. at our Neimans Northpart store. Looking forward to seeing you again soon, and please do not hesitate to call for any assistance. Sincerely, Diana Carreon
Neiman Marcus
Diana Carreon
SALES . FASHION . ACCESSORIES
(214)363-8311 Ext. 2127 Res. 327-2258

400 NORTHPARK CENTER DALLAS, TX 75225

Patterns of Nonverbal Communication

INTERPRETATION BODY ANGLE FACE ARMS HANDS

Power, dominance, superiority

Exaggerated leaning over.

Piercing eye contact.

Hands on hips.

Hands behind neck or back. Steepling (fingertips touching).

HANDS

INTERPRETATION

BODY ANGLE

FACE

ARMS

Nervousness, submission, apprehension

Fidgeting or shifting from side to side.

Head down. Minimum eye contact. Constant blinking.

Hands to face, hair. Rubbing back of neck.

Wringing hands. Fingers clasped.

Source: Barton Weitz, Stephen Castleberry, and John Tanner, Selling: Building Parternships, 3rd ed. (Burr Ridge, IL: Irwin/McGraw-Hill, 1998).

Patterns of Nonverbal Communication

INTERPRETATION BODY ANGLE FACE ARMS HANDS

Disagreement, anger, skepticism

Turning body Negative away. shake of head, frown. Lips pursing. Eyes squinting. Chin thrusting out.
BODY ANGLE FACE

Arms crossed. Finger under collar.

Fist. Finger pointing. Hands gripping edge of display.

HANDS

INTERPRETATION

ARMS

Boredom, distinterest

Slouching against display.

Lack of eye contact. Looking at door, at watch, out window. Blank stare.

Playing with object on display case. Drumming on display case..

Source: Barton Weitz, Stephen Castleberry, and John Tanner, Selling: Building Parternships, 3rd ed. (Burr Ridge, IL: Irwin/McGraw-Hill, 1998).

Points to Consider in Handling Objective

Anticipate objections Create opportunities from objectives

Maintain a positive attitude

Understand customer objections

Sources of Objections

The customer may be objecting due to lack of information

The customer may be setting a condition The objection may be genuine

Indicators of Assertiveness
Less Assertive
Ask oriented Go-along attitude Cooperative Supportive Risk avoider Makes decisions slowly Lets others take initiative Leans backward Indirect eye contact Speaks slowly, softly Moves deliberately Makes few statements Expresses moderate opinions

More Assertive
Tell oriented Take-charge attitude Competitive Directive Risk taker Makes decisions quickly Takes initiative Leans forward Direct eye contact Speaks quickly, intensively Moves rapidly Makes many statements Expresses strong opinions

Indicators of Responsiveness
Less Responsive
Controls emotions Cool, independent Task oreinted Use facts Serious Impersonal, businesslike Moves rigidly Limited use of gestures Formal dress Disciplined about time Controlled facial expressions Monotone voice

More Responsive
Shows emotions Warm, approachable People oriented Uses opinions Playful Personable, friendly Moves freely Gestures frequently Informal dress Undisciplined about time Animated facial expressions Many vocal inflections

The Social Style Matrix

Low Responsiveness

1
2
Low Assertive

1
2
High Assertive

3 4 D C B A
High Responsiveness

3 4

Cues to Identify the Social Styles of Customers

Analyticals
Technical background Achievement awards on wall Office is work-oriented, showing a lot of activity Conservative dress Like individual leisure activities, such as reading, individual sports

Drivers
Technical background Achievement awards on wall No posters or slogans on office walls Calendar prominently

displayed
Desk placed so contact with people is across desk Conservative dress Like group activities, such as politics, team sports

Cues to Identify the Social Styles of Customers

Amiables
Liberal arts background Office has friendly, open atmosphere Pictures of family displayed Personal mementos on wall Desk placed for open contact with people Casual or flamboyant dress Like individual leisure

Expressives
Liberal arts background Motivational slogan on wall Office has friendly, open atmosphere Cluttered, unorganized desk

Desk placed for open

contact with people Casual or flamboyant dress Like group activities, such as politics, team sports

activities, such as reading,

individual sports

Versatile and Non-Versatile Behavior

Less Versatile
Limited adaptability to others needs Specialist Well-defined interests Firm of principle Predictable

More Versatile
Able to adapt to others needs Generalist Broad interests Negotiates issues Unpredictable

Single-minded

Looks at many sides of

issue

Techniques to Alter Sales Behaviors

Reducing Assertiveness
Ask for customers opinion Acknowledge merits of customers viewpoint Listen without interruption

Reducing Responsiveness
Become businesslike Talk less

Restrain enthusiasm

Be more deliberate dont rush

Make decision based on facts

Stop and think

Let customer direct flow of conversation

Techniques to Alter Sales Behaviors

Increasing Assertiveness
Get to the point Dont be vague or ambiguous Volunteer information Be willing to disagree

Reducing Responsiveness
Verbalize feelings Express enthusiasm Pay personal compliments Spend time on relationships rather than business Socialize--engage in small talk Use nonverbal communication

Take a stand Initiate conversation