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Winners & Losers in 2009

“It is only when the tide goes out, that you can see who is swimming naked.” Warren Buffet’s oft-quoted quip seems rather prophetic for the times we live in. Already many have been exposed with many more to follow. A few failures have appeared predictable to many, while others have been more surprising to some.

So who will win and who will lose in 2009?

The best guide is to use the five keys to success in a constrained market (that will at best grow at the rate of inflation). These five keys form a checklist for evaluating any retailer’s performance in the current market context. The retailers that focus on calmly and diligently executing against this simple set of keys will succeed where others will resemble a lifeboat trying in vain to save too many panicking passengers and ending up being swamped in the process.

The first of the keys revolves around ensuring everything in your selling environment is attuned to what it will take to convert foot-traffic. After all, shoppers are still shopping and in times of stress an increased number of shoppers become more impulsive in there purchasing behavior. Which leads to the second key.

Once you’ve achieved the first item in the basket (conversion of browser to buyer) the next key is increasing basket profit dollars. Item based gross profit percentage gives way to basket profit dollars in times like this as a combination of visual merchandising, impulse product placement and good old-fashioned salesmanship is used to lift the number and value of the items in each and every shopper’s basket.

The third key revolves around understanding the difference between productivity generating expense and basic costs in cost control. Smart retailers know where to save and where to spend and do not treat all expense lines the same while still managing to keep costs down.

The fourth key is ensuring that you claim credit from the shopper for the value that you give to them every time they shop with you. Great retailers don’t wait for the shopper to discover it – they point the value out to them at every opportunity.

And the fifth key is understanding that – above all else – the objective of each and every retailer is to create genuine individual magnetism and excitement that makes the customer want to spend money and spend it with you again and again.

Five simple keys form a five-point checklist to evaluate your own performance and those of your competitors in 2009.

So who will win in 2009? Will it be you?