Strategically buying and adding accessories to your stock

by arslan_ahmed | December 18, 2023 9:00 am

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By Crystal Lengua

Selling accessories extends beyond profit considerations (although that plays an important part). Accessories enhance high-value products and hot tubs, attract customers to the store, encourage repeat buying, enable upselling, and provide gifting options. Within the pool and spa industry, accessories play a significant role, as they encompass elements of enjoyment, relaxation, family bonding, self-care, water maintenance and safety (what the industry is all about).

Choosing what accessories to sell, or continue selling, may seem daunting; however, one can use a variety of analysis, data, tools, and other strategies to determine what aligns with their business and target audience. Maximizing sales success entails leveraging existing sales information and involves questioning which products best cater to customers’ needs, budget constraints, and inventory. While cost is obviously a determining factor, it is important to keep in mind that a good product mix can include higher cost, lower profit items. These items, although they may not yield substantial profits individually, can potentially draw attention to the store, thereby facilitating the promotion of higher profit items.

When creating or forecasting a sales plan, one must consider the bigger picture. Knowing what to sell goes beyond simply having sellable items; it is also about overall inventory management. Poor inventory management hurts cash flow, and failing to stay updated on supply chain disruptions, industry trends and customer purchasing habits can lead to challenging situations. It is essential to avoid being burdened with obsolete inventory that is just sitting around. Duplicate inventory purchases can occur when regular reviews are neglected, and the risk of missing inventory arises when proactive forecasting is overlooked.

Here are some methods for businesses when selecting what inventory items to stock (and when):

Basics, point-of-sale (POS), upsell, and big-ticket items

These are no brainer additions. They range from essential items, such as hot tub steps and cover lifters, to more indulgent offerings such as spa scents. These are items customers naturally expect a pool or hot tub store to carry, much like chemicals. This category includes boosters, handrails, towel holders, and umbrellas, which are known to have steady sales and also create opportunities for upselling in conjunction with big-ticket items such as pools and hot tubs.

In addition, it is crucial to consider point-of-sale (POS) items strategically. Store owners should ask themselves which small, inexpensive items can be placed near the cash register to encourage quick purchases. Maintaining a changing rotation of these items is advisable to pique customers’ curiosity and prompt them to get in the habit of checking out “what’s new” each time they make a purchase. If the product selection remains static, customers may eventually start to overlook them.

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Use internal analytics, data, and forms of analysis

Individuals have a wealth of communicative data right at their fingertips. By looking at past sales and customer purchasing patterns, one can identify the top-selling items, as well as those that have performed poorly by looking at inventory turnover rates (calculated as Days in Inventory [DSI]: DSI divided by inventory value). This data-driven approach is beneficial when making decisions about what to replenish and which items should go on sale to make way for a new product. Sales forecasting is a necessary tried-and-true planning tool, as it enables businesses to anticipate and meet customer demands while minimizing excess stock collecting dust in the warehouse.

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In the pool and hot tub industry especially, seasonal considerations play a vital role. Monitoring inventory levels as the season comes to an end is crucial for improved forecasting. It is advisable to exercise caution when considering “one-time product” purchases, particularly items with specific dated features, such as holiday decorations for a particular year. Choosing to buy generic specialty items rather than those tied to a specific date allows them to be resold the following holiday season.

For businesses seeking assistance with forecasting, Google Analytics offers a range of free reports that reveal valuable insights. These reports provide information on the most-viewed pages and products, along with their popularity in nearby cities, making it particularly advantageous for those with multiple store locations. Further, Google Analytics enables the filtering of top product performers based on clickthrough rates, or for those involved in online sales, cart conversion rates.

By using behavioural data, businesses can also gauge trends and get a feel for what is or may be popular items. For instance, this could involve comparing the appeal of one type of floatie versus another in their inventory or tracking the usage of specific terms or keywords entered into their website’s search bar. The reporting options within Google Analytics, including the more advanced GA4 version, offer a multitude of ways to analyze data, potentially leading to an in-depth exploration of various layers of information. Reviewing analytic data is a task substantial enough to warrant an entire article, given the vast depth of analysis that can be undertaken.

As a retailer or distributor, it is imperative to access and utilize real-time data and analytics regarding inventory levels, stock movements, and pertinent metrics. This capacity empowers businesses to make well-informed decisions regarding inventory management and, in turn, enhances operational efficiency.

The product itself: Branding and packaging

Retailers should consider how a product presents itself before making the decision to stock it in their store. It is important to view it from the perspective of the customer and ask whether it has the potential to attract them. The significance of product packaging in shaping consumer buying choices should not be underestimated. A brand’s use of colours, images, and materials should capture attention and facilitate sales. Further, it is important to assess whether the branding aligns with the company’s image. For instance, if the business is positioned as a high-end retailer, the product should exude an air of sophistication. Conversely, if it caters to a family-focused demographic, the messaging and packaging should be kid-friendly.

The product’s purpose should be readily evident through its design and printed materials to avoid any potential misunderstandings. This is key because businesses want to avoid scenarios where customers make a purchase only to return it feeling upset or misled. Keep in mind, even though the retailer did not make the product, by selling it, they become associated with its overall quality in the eyes of customers. Today, in the world of social media and online reviews, it is imperative to make informed decisions to minimize the chances of offering subpar products to customers.

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Competitive analysis

Conducting a competitive analysis provides a business with the opportunity to understand what other businesses nearby are selling in terms of both basic and unique products. It enables them to gain insights into the existing market landscape and identify any advantages their competitors already possess. The goal is not to directly compare or replicate the strategies of other businesses, but rather to use a simple strengths, weaknesses, opportunities, and threats (SWOT) analysis to identify internal starting points and potentially fill any gaps in the market. The objective is to stand out in the market, and being aware of the competition will not do any harm. Further, this research yields valuable insights into the competitors’ marketing approaches, allowing businesses to understand how they are selling their products. Having this knowledge can be instrumental in the development of stronger and more effective business strategies.

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Shelf life and available space on the shelf

Retailers should take into consideration any products in their inventory that have expiration dates and carefully assess how quickly these items need to be sold or restocked. Making notes within the purchasing system is a helpful practice to stay informed about when products need to be cleared from the shelves or, in the case of high-selling items, when to replenish them. It is essential to be cognizant of items with expiration dates and work them effectively into the sales plan accordingly.

Further, retailers should evaluate the available shelf space in their store. If space is limited, exploring options, such as online or ecommerce distributor fulfillment, might be a good idea. Communication with suppliers can provide an idea into the feasibility of whether this approach would work. This strategy can expand the product offerings without tying up physical space (or cash). In essence, it allows customers to purchase items in the store through the website or an iPad, with the products shipped directly to them by another company.

Ask customers directly

It seems like a no-brainer, but there are now more ways than ever to gauge customer interest. Retailers can send out surveys through e-blasts or engage with their customers on social media by asking them questions (e.g. selecting the umbrella colours for the upcoming season). People love to feel included. A bonus to this strategy is asking for feedback, as it will increase social engagement.
As a result, retailers should remember to review their social media analytics for data as well because popular platforms offer a lot of beneficial data
at no cost.

All in all, making informed decisions is always a smart approach (and a good place to start). However, retailers should not be afraid to trust their instincts and take calculated risks when they intuitively sense a potential fit for their business. With a deep understanding of their business, they can make judgements based on their past experiences and feelings. “Market Sense” and creativity are also valuable tools that can catapult them toward sales success. In the ever-changing landscape of multiple product offerings and access to a plethora of fun, new, and unique items, trial and error is often an integral part of discerning patterns in the dynamic world of purchasing plans, particularly in industries like the pool and spa sector.

Author

Crystal Lengua serves as the vice-president of SMP Specialty Metal Products/Ultralift. Her extensive experience in the pool and spa industry spans an impressive 23 years, cementing her status as a seasoned veteran. Lengua’s expertise extends beyond the confines of her office, as she actively engages in in-class seminars and delivers speeches on tradeshow platforms. Further, she has contributed to multiple publications such as Pool & Spa Marketing and Pools & Patios. In recognition of her accomplishments, Spa Retailer Magazine featured her as a “Power Woman” in her field during her illustrious career. Lengua is a devoted mother of four, a student at York University, a yogi, and an advocate for female empowerment. Her educational journey boasts many achievements, including graduation in marketing management, public relations and corporate communications, professional sales, social media marketing, and event management. Lengua also holds a certification in mindfulness meditation from the University of Toronto (U o f T), equipping her with valuable tools for self-care and personal growth.

Source URL: https://www.poolspamarketing.com/trade/features/strategically-buying-and-adding-accessories-to-your-stock/

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