This post is part of Auntie Kate’s 35th anniversary of being a consignment shopkeeper, author, maven, and fan. Here’s the intro to our anniversary giveaway, and if you haven’t already posted a comment on this week’s messages to enter each drawing: Monday’s is here, Tuesday’s is here, and Wednesday’s is here.
So many shopkeepers spend every day, in every way, telling the world that they are incompetent.
Yes, they do. How? By training their shoppers to perceive that the shop prices merchandise too high. That, if the shopper waits, the price will come down. That, in effect, the price the shopkeeper set was way more than it’s worth.
To constantly hammer your loyal customer base with “20% off all jeans” or “Savings thruout the store!” “fill a bag for $10” or “dollar rack bargains” makes THEM think that all of your set prices are more than you’ll sell it for. Is that truly the message you want to send?
Do you really think that price is the #1 reason people buy from you? Tell us yes or no. If no, tell us what you do think (or know, if you use customer surveys in your business), and what message is the dominant one in your advertising and marketing messages.
Enter your comment here on the blog for a chance to win today’s Anniversary Celebration prize: a Valued Sponsor listing at HowToConsign.com. This includes a free e-business card with its own URL, if you don’t have a web site yet, and this month’s sign-up bonus. If you are already a Sponsor at HTC, you’ll receive even more goodies that I think you’ll be pleased to get… of course, if you don’t enter, you won’t win.
A couple of past posts that might have you looking at this issue from a fresh angle:
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Where’s my 87 cents? A Guide to Increasing your Prices for Consignment & Resale Shops.
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Stop Giving Cash Off in your Shop NOW
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How much is YOUR floor space worth?
Photo courtesy of Per Knudsen.
Auntie Kate The Resale Expert 
What is the url of your website’s rss feed
Hi Ray,
Thanks for your interest! If you are using a web browser that doesn’t display the feed icon up in the address box automatically, you can access the RSS feed of any wordpress blog by adding /feed/ to the blog’s url… so for Auntie Kate, you’d type in http://AuntieKate.wordpress.com/feed/
[…] Do you really think price is the #1 reason people buy from you? […]
[…] price-reduction events. Ten shopkeepers had the answer, just a simple yes or no, to the question Do you really think that price is the #1 reason people buy from you? We drew Julie@repeatstreet.com as the winner of a Valued Sponsor listing and map pointer for this […]
No, price is definitely not the number one reason that customers shop at my store. I recently sent out a newsletter survey asking customers what they liked most about shopping at The Fashion Safari. The primary responses included the following:
1. Customer Service was number one!!
2. Clean and Neat.
3. Very well organized.
4. Trendy boutique atmosphere/environment.
5. Selection and variety of merchandise.
6. Quality of items taken in on consignment.
7. “New” jewelry and accessory items.
8. Attractive Displays.
9. Uncluttered with wide aisles and racks that aren’t over-
crowded.
10. Great prices.
11. Coupons and special sales.
Sales are a necessary evil in all retail establishments. I try and keep it fairly simple by having a constant “Color-slash Sale”. I don’t put items on sale until they are within a week of the 60 day expiration date. I use a simple “color-slash” system where I take a unique colored marker and put a slash mark across the price. I also use a hole punch to punch a star onto the tag (in case someone tries to duplicate my slash). I have signs throughout the store that read, “40% Off All Color-Slashed Merchandise”. This method has worked extremely well for me and is so easy to maintain. The only exception to the rule is that I will not automatically color-slash any higher-end items without consulting the consignor.
I do use coupons and I have to say that my customers love them. I run a regular coupon in a direct mail campaign and will occasionally run an additional coupon in the daily local newsaper or send one out in my email newsletters. The typical coupon is for: “15% Off Any One Regular Priced Item”. The coupon isn’t always for a discount. The last one I ran was for a free votive candle with any purchase. It worked great and I got them hooked on the candles! I also have a frequent shopper card that my regular customers just love!
[…] to enter each drawing: Monday’s is here, Tuesday’s is here, Wednesday’s is here, and Thursday’s. Your passion is waiting for your courage to catch […]
I originally thought I would do 20% discount at 3 weeks and 40% at 6 weeks with a 60 day consignment period. This was not advertised to customers, just in my consigment agreement. What I found was my customers were very pleased with my prices, so much so that I found it wasn’t necessary to keep things moving to lower prices when the customers weren’t concerned about sales. I have decided instead to give the consignor the option to place items remaining after the consignment period in a clearance area for 2 weeks then donated if not sold from there. This is working great. My customers do not hit the clearance first, they know to get the good stuff while it’s here then they go through the clearance to see if there’s anything there they missed the first time around.
I’ve changed my consignment agreement and everyone seems very pleased with things this way. Occassionally I offer a discount on groups of items if it’s something I have way too much, or give out small percent off coupons to certain groups (like recently MOPS groups, 10% off) or ‘Free Gift with Purchase” (like pencils engraved qith my website to all back-to-school-purchases in
August).
Because my business is still so new, I’m sure there will be things I tweak along the way. But my main focus has been and is my “value” in the community, so I like the fact my prices are not the deciding factor in shopping with or consigning with me, and less work for me doing all those markdowns is a big plus!
Abundant Style is also a plus size shop, open only one month! I have had very little negative feedback regarding high prices. I have been taking your advice, Kate, about NOT lowering prices on Grand Opening days, etc. My advertising promotes my shop as UPSCALE, bringing brands and designs of plus size clothing to our area that is not otherwise available. I price new items around 50% of retail, used items at 33% of retail. Sales have been steady and most customers are very pleased with the selection. I have not even reached my first markdown date, so I cannot comment on how that will affect sales.
So in summary, the customers I wish to attract will come to me for the quality and selection of the clothes I provide, not bargain prices.
Hi Kate,
When you put it that way, I guess we are giving the discount to everyone but they must spend at least $50.
We have a frequent buyer card that can only be punched when buying full priced items.
Things have slowed down quite a bit the last couple of months and I’m having a problem figuring out the best strategy to change that. I have your book and am trying to use it but if you have suggestions I am listening.
Debi
Auntie Kate…
I keep my prices reasonable…I have friends who are consignment owners who say my prices are too low, but my customers have no complaints. My customers complain that the other consignment shops are too expensive! Mostly when I market or advertise, I try to stress how close I am (right around the corner from where you live!), and to shop here first before going elsewhere (mart stores, etc. are about 45 min away), and that I do carry a lot of new with tags or nearly new items. Not just clothes, either. Two main reasons I have heard from new customers: curiosity and word-of-mouth advertising. The curious customers have gotten my name from the Chamber of Commerce and are wondering what this big 2 story barn on a back road can offer. The ones who’ve heard about me from friends are always so excited when coming in…and leaving. They can’t wait to tell someone else! 🙂
I used to have way too many coupons and discounts. I found that people were only coming in if they had them, so I stopped doing them. Not completely stopped, but I don’t have coupons very often at all – maybe a couple of times per year. Last year I created a Rewards Club for frequent shoppers and reward those that spend the most money with me 10% off their purchases for the year. I feel this has worked very well for me.
Julie
We are a Plus Size shop only and I have to say “No”; our prices are not the main reason women shop with us.
I recently completed a survey of my shoppers and this is the order of reasons that they shop at Divas:
1. Atmosphere, cleanliness and service
2. Condition of clothes
3. Variety of sizes, brands and styles
4. Ease of moving between racks
5. Prices
My biggest complaint was that the lighting in the dressing rooms needed to be brighter. I am working on that now.
I had about 6 people (out of 100) who did put price at the top of the list. I believe you will always have people who want or need to shop by price.
One of the things we’ve done to accomadate them is to put out a prize wheel. We put verious discounts on the wheel and if they spend at least $50 they get to spin the wheel. We give them what ever discount they spin at that time. Everyone seems to like it!
Debi
Debi, I had EXACTLY the same results with my Customer Surveys…price was always in at least 4th place if not lower, after things which didn’t involve forking over my hard-earned profits and undermining my pricing expertise and credibility.
I do have a question, though…you said 6% of your participants put price as #1 in importance…so in reaction, you are telling every single customer that they can get a discount with your wheel? If I am not misunderstanding your message, you’re handing out money to everyone, including the 94% who thought your prices were just fine the way they were? Wouldn’t a Frequent Buyer Card be a wiser choice, since price is NOT an issue according to your survey?
I am one of those that think large stores have an original price higher than it should be so they can always have HUGE MARKDOWNS. My dad always says, they must be doing horrible if they have to mark everything down 50% all the time to get people in here. No, I believe they mark it all up so they can mark it down to that. If they really had to mark everything down to 50% off for a long period of time, they probably would have closed up shop already.
As for consignment stores… I like to go in and see that there is a certain color tag on 50% sale of course, by the time I check out I usually find more that aren’t on sale to purchase. I know the reason why they do this discount is to get rid of it, that they don’t want it in the store anymore, not just to get you to buy everything. It does help us knowing that a certain shop will always have SOMETHING on a super sale even if it’s not always something we can use.
We like thrift store shopping because of the prices we can get although you really need to dig to find something you can make yourself buy.
We’ve also been furniture shopping and love it, however shortly after the consignment store opened, and after our first time going, they started having a TON of NEW stuff. The new stuff is priced HIGH, as it should be, because it is new. Seeing high price tag after high price tag discourages us and we then go from trying to find something we want to seeing who can find the highest priced item in the store and most of the time we end up not buying anything.
Most of our consignment shopping has been children’s. We have two small children, and like most others our closets are full. We are able to drop our used, and many times not used, clothing off while picking up some more items that do fit now. We LOVE the 2 independently owned(non-franchise) shops that are near as they are always clean, friendly staff, easy to shop. We’ve visited the “chain” shop probably a total of three times as we can never find anything. They have got to have 3 times the amount of stuff that you should have on each rack, completely bulging and you can’t see the front of back of anything because you can’t move the others around. Aisles are really narrow and shelves are stacked to the ceiling, a bit tight. Find myself looking to see if anything is going to topple over on me as I go through the aisle rather than looking at merchandise.
I hope this helps! We put in an offer on a lease for a store but haven’t opened shop yet so we can’t give any in-store, real advice, only what we see when going out.
Thanks!
Jon