Issue link: https://read.dmtmag.com/i/410969
SOLUTIONS 34 • November 3, 2014 • Powersports Business www.PowersportsBusiness.com Apparel, clothing, garments … whatever you (or your supplier) choose to call it, is an important piece of our PG&A (PC&A, PA&A) business. What makes it so important? For one thing, much of what we should be offering has to do with rider safety. Things like helmets, boots, gloves, goggles, specialized jackets and leather goods all represent products that can help keep our customers alive and healthy, while at the same time providing a level of comfort, function and style. Although we sometimes stock because of color or style, the comfort and function parts are very important to many folks. For example, a touring rider's desire for all-day comfort and functionality in the cold and rain will generally override concerns for style. For another thing, we stock branded clothing that satisfies peoples' desire to be recognized as riders; participants; perhaps they even want to be thought of as risk-takers. Some brands like Harley-Davidson, Triumph and Indian have the luxury of selling branded clothing to people who will never ride any- thing. They just want people to think they do, or perhaps they buy it because it is "trendy." The downside of apparel comes from the number of turns. It is not unusual for me to find dealers who have 50 percent or more of their clothing with zero turns in 12 months. We call this obsolescence or OBS for short. OBS ties up capital that can be better invested in high-turn parts and accessories. Slow-turn- ing apparel can really put a hurt on cash flow. The mistakes that contribute to this include managers who select what they like rather than what customers buy — come on, most of us are guilty as charged. Another is investing in too many styles and colors rather than stocking sufficient quantities of the sizes that sell in your market. It does not work to have one in stock, and then just order what the customers want. Most of the time the customers want it today; much of our clothing is bought on impulse. So what are some of the key points that can help maximize your returns in this department? 1. Establish an Open-to-Buy process for apparel. Set a limit on the amount of inventory dollars that you are willing to dedicate to this department. The parts manager must break that figure down into segments like helmets, boots, jackets, shirts, etc. Then, they need to track the sales by segment, so they can reduce stocking of what doesn't sell, and replace it with higher- turning inventory. This is essential to improv- ing the performance of this department. 2. Staffing. You need to have salespeople who can explain the benefits of the clothing items you stock. Your suppliers are the key here — demand product training for your staff. Staff members also need to know how to properly fit a helmet or boots. A poor-fitting helmet can be as dangerous as no helmet at all. 3. Focus. When dealing with riders, the presentation should always begin with safety gear. What do they have? What condition is it in? How well does it function? These are key questions the staff needs to ask. 4. Merchandising. Many dealers have had great success hiring people with department store training. Getting your clothing properly displayed will drive sales. Wall displays should always feature high-demand, colorful clothing. Mannequins, especially if posed on units, help customers visualize themselves in the product and stimulate mental ownership leading to increased sales. Displays have to be rotated frequently to stimulate interest and keep the clothing fresh and clean. 5. Display racks. Round racks full of shirts are often used for sale items — you can support higher prices using waterfall or tiered displays. 6. Develop packages. Put package-priced basic and advanced riding gear on mannequins on or near the related products (motorcycles, ATVs, etc.). You can always change out indi- vidual pieces based on customer preference. About 40 percent of our unit buyers have little to no gear at all. Others will be encouraged to update their riding gear. 7. Track & measure. Keep track of the dollars-per-square-foot return on your dis- plays. How much did you sell? How often did it sell (turns)? What kind of margin did you get? Knowing this will help you find the "hot spots" in your display area. These areas consistently sell more product and can be utilized when you really need to move some aging inventory. 8. Closeouts. Establish a "sale" area toward the back of the department rather than having sale items scattered around the showroom. This will attract customers through your merchandise to see what is on sale. Put up adequate signage to draw them in. Recognize that apparel represents additional profit opportunities for your store. However, you have to do more than just buy a bunch of it and hang it on a rack. Do it right, and you will attract additional shoppers that may turn into unit buyers. PSB Steve Jones is senior projects manager at Gart Sutton & Associates. He has worked in the powersports industry for more than 30 years, for dealerships and manufacturers, and as a consultant and trainer. Contact him at steve@gartsutton.com. Overcoming the drain of apparel obsolescence RETAIL REMEDIES STEVE JONES