How to Make the Most of Going Out of Business Sales For Your Jewelry Store
The sales of your store are downright suffering and you are pondering all your options. Top of mind is to close your business to cut losses. One of your biggest concerns, though, is what to do with all your merchandise. This is where going out of business sales come in.
Your inventory equals money and if you are not able to sell them, it translates to wasted money. So, it is important to sell as much of your inventory as possible before and even after you close your jewelry store.
Closing a jewelry business can be stressful and emotional but a closing sale can help you unload your inventory and make some revenue.
Why do Jewelry Businesses Close?
There are many reasons retail businesses close. Here are some of them:
- Poor Management
Managing a jewelry business entails the right business acumen, organizational skills, great attention to detail, financial knowledge, inventory management, and people management skills. You should also have a feel of your market and invest in advertising. When one of these elements is missing, your business is bound to fail.
- Insufficient Capital
A business that runs out of working capital is often due to unrealistic forecasts or poor budgeting. You may be assuming too much that your business will be self-sufficient long before it does.
- Poor Credit Management
Having access to credit is the lifeline of a business. It allows you to obtain additional capital, cover operational expenses, and hire additional staff. A line of credit from suppliers allows you to hold on to your cash on hand for other business expenses.
If you do not manage your credit lines, well, you will have to purchase inventory on a cash basis. You will also not have access to business loans from banks and other lenders. This arrangement will limit your cash flow management.
- Unforeseen Events
The COVID-19 pandemic caught everyone by surprise. Many retail businesses were hard hit by the economic downturn. Not all businesses close because of business failure. Some profitable businesses can also decide to close shop due to unforeseen circumstances.
After deciding to close your retail store, the next thing you need to think of is business liquidation or how to turn your inventory into cash.
How to Launch Successful Going Out of Business Sales For Your Jewelry Store
The going out of business sales is in itself a business model. Lately, it has been big business.
Many think that the process of launching a business liquidation sale is pretty straightforward. You just need to stick some large discount stickers on your store’s windows and wait for customers to come in. The higher the discount the faster you can dispose of your inventory.
This may have worked in the past, but today, going out of business sales entails strategic planning.
Your business liquidation sales plan will make sure you sell all or almost all of your store’s remaining inventory in the most rewarding and effective way.
- Decide How Long
Most jewelry business liquidation sales run for between eight and ten weeks with some stretching up to 12 weeks before the official closing of the store. You do not have to communicate the duration of your sale to customers so you can create a sense of urgency.
The duration of the going out business sales affects your pricing strategy,
- Plan your Pricing Strategy
How much discount will you slap on your merchandise? You also need to decide if you will change your discounting scheme during the sale.
Make the discounts large enough to encourage customers to buy more of your merchandise. A 40% to 70% discount is the most ideal.
You can start your sale with a 40% discount on all items. As the sale goes on, you can increase your discount to 50% and then 70% depending on the movement to liquidate all of your inventory.
- Advertise and Promote
With all details of your sale in place (pricing strategy, when, and duration of the sales), it is time to create your advertising and promotion strategies.
While you do not want to spend so much on advertising, your local community needs to be aware of your closing out sale.
- Have screaming signage on your store windows.
- Advertise the sale on your social media accounts
- Email your customers
- Announce the sale on your website
- Place an ad in your local newspaper and radio
- Distribute flyers at strategic locations in your community.
Use the right messaging in your advertising campaign. Your jewelry customers will be interested in large discounts so make sure to mention the kinds of discounts they will be able to find.
Make sure to also include the dates of the sale. Emphasize that this is a going out of business sale and that you want to sell everything. This will tell your customers that there are large discounts on all items in your store.
- Place Specific Signage Around your Store
Communicate the mechanics of the sale to your customers by placing signage around your store. Such mechanics may be a “no return no exchange policy” or not accepting reward program points, and coupons. Of course, the discounts on the merchandise should also be well-displayed.
- Have a Post-Closing Sale
Sell all your unsold inventory through a post-closing sale. You can do this either through a business-to-business sale or a liquidation option. You can run the event yourself or work with a company that specializes in liquidating merchandise.
If you opt to run the post-closing sale yourself, make it clear that you are selling off your leftover inventory in bulk.
Price your left-over inventory a bit lower than you did before your closing. If everything was 50% off during your business liquidation sale, you can price everything at 75% off. You can even sell some of your products at acquisition cost.
Do not advertise your post-closing sale before your store’s closing date. You want to sell as much merchandise as you can at a higher price.
- Donate What You Cannot Sell
There is a big possibility that you will be left with a few pieces of merchandise. You can donate these to your chosen charity and get a receipt you can use for tax deductions.
Jewelry store closing sale to unload your inventory and make some revenue
It is bittersweet to close a jewelry business. There may be some feelings of regret or a sigh of relief. There are also many things you need to do. You will have final payments to make for your rent, utilities, creditors, and staff.
Going out of business sales will not only raise the revenue you need to cover these final expenses but if you make the most out of it, you will be left with some money to help you get by while thinking of your next steps.
