Marketing Checklist for
Retailers
Summary
This is a checklist for the owner-manager of a small retail
business. The questions cover areas of retail marketing,
including aspects like customer analysis, buying, pricing,
and promotion. You can use it to evaluate your current
status and, perhaps, to rethink certain decisions.
If your retail firm is to be successful over the long run,
it must satisfy the needs and desires of its present and
potential customers. Sound buying means knowing where to
buy, what to buy, how much to buy, and how to place an
order. This requires familiarity with old and new products,
adequate amounts of the right stock on hand, and selecting
and working with suppliers in ways that benefit the store.
In pricing, you need to understand the market forces
affecting your business, plan the price policies that you
will follow, and know whether or not your pricing policies
meet Provincial and Federal regulations.
In addition, you need to be familiar with various types of
promotion and when, where, and how to use them. For example,
a credit program or other special customer services can be
attractions.
Under the heading of management goes the establishment both
of long and short-range goals. How you set up your
organization and how you communicate with your employees are
crucial factors in the accomplishment of your goals. Of
equal importance to good management is the ability to keep
and make use of accurate financial records. It also pays to
examine your insurance coverage in various areas.
In answering the following questions with a YES or NO, you
will be reminded of what you may still need to do to round
out all marketing aspects of your business.
Customer Analysis
• Who are your target customers and what are they seeking
from you?
• Have you estimated the total market you share with
competition?
• If you concentrate on a segment, is it large enough to be
profitable?
• Have you looked into possible changes taking place among
your target customers which could significantly affect your
business?
• Can you foresee changes in the makeup of your store's
neighbourhood?
• Are incomes in the community apt to be stable?
• Is the community's population subject to fluctuation?
• Do you stress a special area of appeal, such as lower
prices, better quality, wider selection, convenient
location, or convenient hours?
• Do you ask your customers for suggestions on ways to
improve your operation?
• Do you use "want slips"?
• Do you belong to a trade association?
• Do you subscribe to important trade publications?
• Have you considered using a consumer questionnaire to aid
you in determining customer needs?
• Do you visit market shows and conventions to help
anticipate customer wants?
• Do most of your customers buy on the weekends?
• Do sales increase in the evening?
• Do the majority of your customers prefer buying on credit?
Buying
• Do you have you a merchandise budget (planned purchases)
for each season?
• Does it take into consideration planned sales for the
season?
• Does it achieve a planned stock turnover?
• Have you broken it down by departments or merchandise
classifications?
• Have you a formal plan for deciding what to buy and from
whom?
• Have you a system for reviewing new items coming onto the
market?
• Have you considered using a basic stock list or a model
stock plan in your buying?
• Are you using some sort of unit control system?
• Do you keep track of the success of your buying decisions
in previous years to aid you in next year's buying?
• Have you a useful supplier evaluation system for
determining their performance?
• Have you established a planned gross margin for your
firm's operations and are you buying so as to achieve it?
Pricing
• Have you established a set of pricing policies?
• Have you determined whether to price below, at, or above
the market?
• Do you set specific mark-ups for each product?
• Do you use a one-price policy rather than bargain with
customers?
• Do you offer discounts for quality purchases, or to
special groups?
• Do you set prices to cover full costs on every sale?
• Have you developed policy on when to take markdowns and
how large?
• Do the prices you have established earn planned gross
margin?
• Do you clearly understand the market forces affecting your
pricing methods?
• Do you know which products are slow movers and which are
fast?
• Do you take this into consideration when pricing?
• Do you know which products are price sensitive to your
customers, that is, when a slight increase in price will
lead to a big drop off in demand?
• Do you know which of your products draw people when put on
sale?
• Do you know the maximum price customers will pay for
certain products?
• If the prices on some products are dropped too low, do
buyers hesitate?
• Is there a specific time of year when your competitors
have sales?
• Do your customers expect sales at certain times?
• Have you determined whether or not a series of sales is
better than one annual clearance sale?
• Do you know what role you want price to play in your
over-all strategy?
• Are you influenced by competitors' price changes?
• Are there restrictions regarding prices you can charge?
• Do any of your suppliers set a minimum standard at which
it can be sold?
• Does your Province have fair trade practice acts which
require you to mark up your merchandise by a minimum
percentage?
• Are there any Provincial regulations on how long "close
out" sales can be advertised?
• Are you sure you know all the regulations affecting your
business, such as two-for-one sales and the like?
• Do you issue "rainchecks" to customers when sales items
are sold out so they can purchase later at a sale price?
Promotion
• Are you familiar with the strengths and weaknesses of
various promotional methods?
• Have you considered which type might be used for your
firm?
• Do you know which of your items can be successfully
advertised?
• Do you know which can be sold best by demonstrations?
• Do you know when it is profitable to use institutional
advertising?
• Do you know when product advertising is better?
• Do you know which of the media (radio, television,
newspapers, section of the telephone book, handbills) can
most effectively reach your target group?
• Do you know what can and cannot be said in your ads (Truth
in Advertising requirements)?
• Can you make use of direct mail?
• Is a good mailing list available?
• Are your promotional efforts fairly regular?
• Do you concentrate them on certain seasons?
• Are certain periods of the week better than others?
• Is there available financial or technical assistance which
you can use to enhance your promotional efforts?
• Can you get help from local newspapers, radio or
television?
• Are co-operative advertising funds available from
suppliers?
• Do you tie your local efforts to your supplier's national
program?
• Do you join with other merchants in area-wide programs?
• Have you looked for ratios to estimate what comparable
firms are spending on promotion?
• Do you study the advertising of other successful retail
firms, as well as you your competitors?
• Have you some way of measuring the success of the various
promotional programs you are using?
• Are your products displayed to maximize their appeal
within the store?
• Do you know which of your items have unusual eye appeal
and can be effective in displays?
• Have you figured out the best locations in the store for
displays?
• Are you making use of window displays to attract
customers?
• If you use multi-tiered display stands or gondolas, do you
know which shelves are the best sellers?
• Have you a schedule for changing various displays?
• Do you display attention-getting items where they will
call attention to other products as well?
• Do you know which items are bought on "impulse" and
therefore should be placed in high traffic areas?
• Where price is important, do you make sure the price cards
are easy to read?
• Do your suppliers officer financing of accounts
receivable, floor planning, and so forth?
• Do you know what type of credit program (if any) you
should offer?
• Does the nature of your operation require some type of
credit for your customers?
• Have you discussed credit operations with your local
credit bureau?
• Would a credit program be a good sales tool?
• Is a credit program of your own desirable?
• Have you looked into other programs of credit cards?
• If you set up your own credit program, do you know what
standards you should use in determining which customers can
receive credit, for what time periods, and in what amounts?
• Do you know all of the costs involved?
• Will the interest you charge pay for these costs?
• Do you know about the Cost of Credit Disclosure Act?
• Have you determined a safe percentage of your business to
have on credit that won't jeopardize paying your own bills?
• Do you offer some special customer services?
• If you offer delivery service, do you own your vehicles?
• Have you considered leasing them instead?
• Have you thought about using commercial delivery service?
• Do you charge for delivery?
• If not, do you know how to work delivery expenses into the
selling price of your products?
• Have you a policy for handling merchandise returned by
customers?
• Have you considered certain obligations to your community,
in terms of charitable contributions, donations for school
functions, ads in school yearbooks?
• Do you participate in activities of your chamber of
commerce, merchants' association, better business bureau or
other civic organizations?
Management
• Have you developed a set of plans for the year's
operations?
• Do your plans provide methods to deal with competition?
• Do they contain creative approaches to solving problems?
• Are they realistic?
• Are they stated in such a way that you know when they have
been achieved?
• Have you a formal plan for setting aside money to meet any
quarterly tax payments?
• Are you organized effectively?
• Are job descriptions and authority for responsibilities
clearly stated?
• Does your organizational structure minimize duplication of
effort and maximize the use of each employee's skills?
• Do employees understand how they will be rated for
promotion and salary increases?
• Does your wage schedule meet the local rate for similar
work and retain competent employees?
• Would you or some of your employees profit by taking
business education courses offered at local schools?
• Will training help your employees achieve better results?
• Do your experienced employees help train new and part-time
employees?
• Have you good working conditions?
• Do you use positive personal leadership techniques like
being impartial, giving words of encouragement and
congratulations, and listening to complaints?
• Are you familiar with the Labour Standards Act as it
applies to minimum wages, overtime payments, and child
labour?
• Do you avoid all forms of discrimination in your
employment practices?
• Do you have a formal program for motivating employees?
• Have you taken steps to minimize shoplifting and internal
theft?
• Have you an effective system for communicating with
employees?
• Are they informed on those plans and results that affect
their work?
• Do you hold regular meetings that include all personnel?
• Do your employees have their own bulletin board for both
material you need to post and items they wish to post?
• Have the "rules and regulations" been explained to each
employee?
• Does each employee have a written copy?
• Is each employee familiar with other positions and
departments?
• Do you have an "open door" policy in your office?
Financial Analysis and Control
• Have you established a useful accounting system?
• Do you know the minimum amount of records you need for
good control?
• Do you know all the records you should keep to aid you in
meeting your tax obligations on time?
• Do your sales records give the key information you need to
make sound decisions?
• Can you separate cash sales from charge sales?
• Can sales be broken down by department?
• Can they be broken down by merchandise classification?
• Do they provide a way to assess each salesperson's
performance?
• Do your Inventory records give the key information you
need to make sound decisions?
• Do they show how much you have invested in merchandise
without the necessity of a physical inventory?
• Do you know the difference between inventory valuation at
cost and at market?
• Can you tell which one shows a loss in the period earned?
• Can you tell which one conserves cash?
• Do you understand the pros and cons of the cost method of
inventory accounting versus the retail method?
• Have you found an accounting method that shows the amount
of inventory shortages in a year?
• Do your expense records give you the key information you
need to make sound decisions?
• Do you know which expense items you have to greatest
control over?
• Are the records sufficiently detailed to identify where
the money goes?
• Can you detect those expenses not necessary to the
successful operation of your business?
• Do you effectively use the information on your profit and
loss statement and balance sheet?
• Do you analyze monthly financial statements?
• Can you interpret your financial statements in terms of
how you did last year and whether you met this year's goal?
• Do your financial statements compare favourably with other
similar businesses in terms of sales, cost of sales, and
expenses?
• Are you undercapitalized?
• Have you borrowed more than you can easily pay back out of
profits?
• Can you see ways to improve your profit position by
improving your gross margin?
• Do you use the information contained in your financial
statements to prepare a cash budget?
Insurance
• Have you adequate insurance coverage?
• Do you have up-to-date fire coverage on both your building
equipment and inventory?
• Does your liability insurance cover bodily injuries as
well as libel and slander suits?
• Are you familiar with your obligations to employees under
both common law and worker's compensation?
• Do you spread your insurance coverage among a number of
agents and take the risk of overlapping coverage or gaps
which may raise questions as to which firm is responsible?
• Has your insurance agent shown you how you can cut
premiums in areas like fleet automobile coverage, proper
classification of employees under worker's compensation,
cutting back on seasonal inventory insurance?
• Have you looked into other insurance coverage, such as
business interruption insurance or criminal insurance?
• Do you have some fringe benefit insurance for your
employees (group life, group health, or retirement
insurance)?
These questions are meant to help you analyze your retail
operation from the marketing viewpoint. You should know the
strengths of your business and products. You must also know
the real problems you are up against.
Your business depends on your good sense and management
foresight. You must adapt to new markets, product changes,
and be innovative to keep your business growing.
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