Cash flow tips for independent pet retailers during COVID-19
May 14, 2020
Keeping a small business afloat during the COVID-19 pandemic is a struggle, and independent pet suppliers are not immune. Foot traffic is down. Pet parents are focused on necessities like food and litter, spending less on toys and other high-margin items. Some businesses had to shutter services like dog grooming to limit face-to-face contact.
Cash flow is the lifeblood of your business, and now you’re faced with the challenge of stabilizing your cash flow or falling farther behind. Solutions like reducing employee hours and drawing down a line of credit often come top of mind. But if you’re looking for alternatives, here are some of the other things small-business owners are doing to jump start cash flow during COVID-19. While no one solution will fix the issue, taking a multifaceted approach to reducing your obligations and increasing your cash flow can help you pay your bills and continue to operate.
Promote gift card sales
Customers who support an independent, locally owned business often enjoy the halo effect that comes with it. Their support keeps dollars in their community, and they experience the joy of visiting a unique shop. That’s where gift cards have played a role among the small-business loyalists during the pandemic: Buy now so your favorite local businesses can use the infusion of cash to operate, and use the gift card later when things settle down.
To move more gift cards, promote incentives. For example, offer a free treat with every $25 gift card purchase. Or, offer a voucher for a free service, like dog grooming, redeemable once local health officials give the all-clear to reopen. Or, team up with another local business to put together a joint special.
[Let pet parents know you’re still here, and read our tips on improving your store’s digital presence.]
Sell inventory that’s not moving at a discount
With foot traffic down, some items may not be selling as swiftly as projected. Though selling at a discount isn’t your favorite option, hanging on can cost more in the long run due to the carrying costs. Plus, as always, you want to make room for the things people actually want. Have a flash sale, promote the special discount to newsletter readers or promote an off-cycle clearance sale.
Manage your inventory
While you’re purging inventory you don’t need, now’s the time to revisit your sales forecast and adjust your orders accordingly. That way, you can avoid a glut of merchandise that won’t move for a long time.
Activate an e-commerce solution
If customers are staying away because they’re avoiding in-person contact, an e-commerce solution offers a safe and convenient solution that lets you continue to serve the needs of their pet. They can order online and show up at the store for a no-contact curbside delivery.
Luckily, there are solutions that make it simple to merge your bricks-and-mortar business with an e-commerce tool. Sign up for eTailPet, NutriSource will pay for your second month of service. (At the start of the process, provide the promo code “NutriSource – Support Local.”)
[To get started, read our tips on launching an e-commerce solution at your pet business.]
Negotiate for payment flexibility
If you’re hesitating to ask for a short-term reprieve, it may help to know your request should come as no surprise to your landlord. The pandemic is touching almost every aspect of business throughout the country — they’ll get it. Also, most property managers would rather do what they can to keep their spaces filled than lose a great tenant. In response, some are waiving rent for a few months, in exchange for payment at the back end of the lease. Others may accept partial payments with an agreement that payments on the balance will come later. What they can and can’t do to be flexible will depend on their own obligations for the property, including taxes, mortgage, insurance and utilities. But having this conversation can free up some much-needed cash to run your business during the height of the pandemic.
When history is in the making, it’s seldom an easy time to be a small-business owner. Following some of these tips can help you move the needle when it comes to getting the cash stream you need to continue operating.
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