Since 1999, enabling retailers and store owners to "Turn on your financial headlights!"

The Top Five “Killers” of Retail Businesses

(Hint: “Declining Sales” Is NOT One of Them!)

People who get their understanding about retailing from the popular press or from political rhetoric often believe that declining sales - “Comp store sales are down” - is the death knell of retailing. Surely you, as a retail owner, know differently! (You do, don’t you?!?)

In reverse order, here are the Top Five principal killers of retail businesses. We will examine each of them. While they all need the respect of you, the owner or CEO, your highest priority always must be the #1 slayer. And it just might surprise you to learn what it is. (Ahh, caught you reading ahead, did we?)

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Which Bank for You?

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Bankers - Where Are They When You Need Them?

Most retailers are constantly in and out of the debt market to finance daily operations. Having a reliable lender is vital to your success. Recognize that your banker - the "relationship manager" - is in fact a salesperson; the actual credit decision will be made by "the loan committee".

Your responsibility is to arm your banker to effectively present your request to the Loan Committee. And that demands that you "speak their language". Especially in today's economy, the need to speak "Conversational Banker-ese" is greater than ever.

Plus, consider carefully the pro's and cons of different types of financial partner you might approach. Let's start with an overview.

	Advantages	Disadvantages
Traditional Banks	Stability Array of financial services Many to choose from Competitive pricing	Lack of retail industry experience or focus Often slow to respond; impersonal Less interested in smaller transactions Generally available only to profitable companies
Private Equity Funds	Provide "hands on" value/added expertise Generally well-capitalized May provide access to industry and management expertise	Provide "hands on" value/added expertise (Yes, it's the good news/bad news thing!) Strict investment criteria Equity ownership required Required returns often 25% + Require track record of a proven concept
Asset-Based Lenders	Nontraditional transactions Fewer financial covenants Industry focused	Rigid documentation standards Higher transaction costs Onerous reporting Traditionally perceived as lending only to troubled companies

The Institute's Owner's Dashboard

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Focus on Your Financial Strength

Use The Institute's Owner's Dashboard Trend Form to track your progress. It's a simple - yet powerful! - three-step process:

Step 1: Enter LY results for five key ratios

Step 2: Enter This Year's Targets

Step 3: Each month (no later than the 10th of the month!) enter YTD results

Immediately see whether - and if so, where - you need to make adjustments now to achieve the results you want. "Lead time" is one of your most valuable assets. Use our Owner's Dashboard Trend Form to put time on your side.

(Need more info on these ratios, how to calculate them, and what they mean? See the Retail Finance Basics section here at The ROI. And, view this online webcast from The ROI Co-Founders for more about the Owner's Dashboard. Click here to download and printout your own master copy of the Owner's Dashboard Trend Form)

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