In today’s tough economic climate every retailer is faced with many challenges. First there are the ever-rising costs associated with owning and operating a business. Utilities, advertising, and labor costs are just a few examples. Then there are the costs associated with purchasing and shipping merchandise for resale. If you own a dollar store business and cannot seem to locate enough merchandise to keep your store fully stocked, now is the right time to take a step back and really analyze your business and the best options available for your store. In fact for the true one-dollar price-point business, maybe now is the time to reformat to over one-dollar. This is article 1 of a 3-part series that will review some of the options a dollar store business owner has available.

Have you ever considered that now might be the perfect time to format from the one-dollar price-point to pricing at dollar increments? For example, rather than selling every item in your store for $1 each, you could establish a range from $1 through $3, $1 through $5, $1 through $10, or possibly even $1 through $20. Once you’ve made the decision to change, the range will depend on your store location and your shopper demographics among other things.

This type of change will affect your current shoppers. In fact it is fair to expect some of your existing shoppers to exit, and move on to shopping with your competitor. Many others will probably give you negative feedback, although they will likely stick with your dollar store business. Existing customer retention will also depend on your ability to keep the most desired $1 price-point merchandise in-stock and available. Keep the items that your customer counted on your store to provide whenever they were needed.

The loss of existing customers can be minimized and new customers can be acquired by implementing an aggressive advertising and marketing program. Establish a budget before the planned pricing modifications are actually initiated. Start the advertising campaign as quickly as possible following the actual changeover. You might even consider holding a ‘Grand Re-Opening’ event to generate some excitement.

It is important to remember that you will be working with much improved margins. You average sale size will also be increasing significantly. As you rebuild sales in your dollar store business, this combination will be important to establishing and then achieving new sales and profit targets.

To your dollar store business success!

Interesting in learning more about this topic? Download my free ebook on internet marketing.

Bob Hamilton is an entrepreneur, author, writer, business consultant and trainer. http://www.OpeningADollarStore.com

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