Retail Merchants Association of Ontario Articles

Articles

Effective Business Gift Giving Year Round

Why wait for the holidays to acknowledge and thank your customers and colleagues? Any time of year is a wonderful time to recognize and reward those you appreciate.

Whether

rewarding an employee for a job well done;
showing appreciation to long-term customers for their continued patronage;
strengthening ties and building goodwill with new clients; or
crediting the assistance of colleagues in referring new business,

the opportunities for gift giving are endless. (Having said that, realize that there are certain circumstances under which gifts should not be given. Clients who have relinquished your services, those with whom you may be in current contract negotiations, or prospective customers you may have just recently met may feel an obligation to accept a gift or awkward in refusing. Gifts should always be regarded as tokens of appreciation and acknowledgement.)

Once you have determined who will receive your gift(s), what to give will be your next decision. Fortunately, there is a business gift solution for every budget... from modest promotional items to more expensive offerings. Current favourites include any golf-related items (balls, tees, umbrellas), light jackets, sports/entertainment tickets/passes or gourmet gift baskets. Office accessories such as pen sets, letter openers, paperweights or desk clocks are always appropriate as business gifts. And customizing any of these gift items with your company name/logo is a perfectly acceptable practice and will help to keep your business front and centre all year long.

Do keep in mind that many businesses have gifts policies so keep the cost of your gift to less than $100. Also, to ensure that the gift you present is appropriate, stay away from anything which may be interpreted as too personal, those having a religious or political message, or liquor.

Just remember this... big or small, expensive or economical... as long as the two basic rules of "quality" and "good taste" are followed, whatever business gift you decide upon will likely be well-received.

How to Protect Your Business from Fraud

With more than half the world’s largest companies recently being victims of fraud and over 25% losing more than one million dollars, we must realize that we need protection in this fraud-fraught world.

There are several ways in which you can protect your business. First of all, purchasing cheques with security features is paramount... accept no cheques but these! Look for such standard built-in security features as:

a warning band informing that the document does contain security features;
a microprint border which can be photocopied but is not readable;
coloured background; and
the words "original document" as a security screen on back.

Other special features such as using chemically sensitive paper or paper that contains invisible fluorescent/coloured fibres, special chemical indicators, colour shifting features or holograms are also available.

A change in habit of regular cheque usage is advisable as well. For example,

avoid using total transfer (otherwise known as one-time, erasable or correctable) ribbons for your manual cheques and use, instead, permanent ink ribbons;
fill manual cheques out by hand with a ballpoint pen and avoid using carbons;
if you use a laser or inkjet printer to print your computerized cheques, understand that the ink does not fully penetrate the paper and can easily be smeared or smudged making cheque alteration that much easier, therefore, be certain that your printer and toner are of high quality and that the information is printed in a large, clear font;
fill in the entire payee line, leaving absolutely no room for alteration;
use non-window envelopes or window envelopes that are specifically designed to be compatible with your cheque (properly sized with a printed lining to ensure confidentiality); and
always have your cheques consecutively numbered.

There are several other general precautionary measures which can be taken in an effort to protect your business. Within your company, prevent access to cheques, signature stamps, cheque reorder forms and other valuable documents by keeping them under lock and key with use restricted to authorized personnel.

Keep the number of employees authorized to have access to your cheques to a minimum. Maintain major financial responsibilities independent from one another and hold surprise audits. When it comes to your employees, start right at the beginning by obtaining references from prospective personnel and following through with a thorough investigation. Alternating staff, passwords, combinations and keys may also provide some measure of comfort. Refraining from making the signatures of company officials common knowledge throughout your company (and, indeed, to the public through annual reports and and other business communications) is also advisable.

Finally, thoroughly examining your bank statements, reconciling your transactions promptly and being ever vigilant to the possibility of fraud will give you the advantage and ultimately the benefit of added protection for your business.

Merchant Processing Information.

Under MasterCard and Visa International rules no merchant can set a purchase limit for debit (for example; Debit purchases must be over $5.00 dollars.), if a merchant does this, are reported, and continue to do so they can be removed from MasterCard and Visa processing services.

It is important to remember that even though you may own your POS Terminal through an independent company a bank or third party processor set up through the bank is still processing your Visa and MasterCard, therefore they cannot remove your terminal however they can stop processing your Visa and MasterCard.

Credit Card Fraud - You Can Make A Difference

A FEW SIMPLE STEPS CAN MAKE A BIG DENT IN CREDIT CARD FRAUD...AND REDUCE THE COST OF DOING BUSINESS FOR EVERYONE.

You are on the front line in the flight against credit card fraud. Here's what you can do about a problem that results in millions of dollars in losses every year, driving up the cost of doing business for every merchant.

TAKE A GOOD LOOK AT THE CARD

VISA cards have a number of security features that identify them as valid.

Look for:

The four digit number above or below the embossed number
The unique embossed symbol (V, CV, BV, or PV)
The three-dimensional Dove design hologram in the centre of the right side of the card
The Visa logo above or below the Dove design hologram

MAKE SURE THE IMPRINT ON ALL SALES DRAFT COPIES ARE LEGIBLE

If you can’t swipe the card through your electronic terminal and must key it in manually, take a special look at the security features on the card
Make sure you take a manual imprint of the card to prove it was present during the transaction

TAKE A GOOD LOOK AT YOUR CUSTOMER

Suspicious customer behaviour can be a signal that the card is fraudulent. Trained your employees to look for people who:

Make random purchases with little regard to price, size, colour or style
Buy an unusual quantity of expensive items
Charge expensive items on the newly valid card
Purchase large items such as TV’s or stereos and insist on taking the merchandise immediately, even though delivery is included
Take the credit card from a pocket rather than a wallet
Sign the sales draft slowly or in an awkward manner
Cannot provide photo identification
Try to hurry the purchase, talk too much, are nervous or are obviously trying to distract attention from the transaction

DON'T FORGET ABOUT FRAUD

It's easy to forget about fraud and fraud prevention. Keeping it in mind at all times, and making sure your staff are trained and regularly reminded about the cost of fraud and the steps they can take to prevent it, will go a long way to reducing the cost of fraud for everyone and protecting your business.

IF YOU SUSPECT FRAUD....CALL FOR CODE 10 AUTHORIZATION

If you have any suspicions that someone may be using a fraudulent card, call your author isolation centre immediately and asked for a CODE 10 authorization. You'll be taken through a series of questions that can be answered with a "yes" or "no", to determine whether the card is legitimate. The operator might give you an author isolation code or instruct you to return the card. That's why it is important to keep the card throughout the process.

Do not attempt to apprehend or detain the person using the card. Instead, make sure you can describe the person and note any other relevant information in case the person leaves the store.

Improvements In Customer Service At Top Of Your Customers Wish Lists

If shoppers could make one improvement to their primary store, they would improve customer service. Twenty percent of a recent focus group survey by the Food Marketing Institute (FMI), cited items in this category. At survey a year earlier was the first time customer service moved into first place, edging out the usual top category of more variety and wider selection.

For most consumers, better service means a more speedy exit from the store with more than half of those in this category specifically mentioning faster checkouts and more cashiers. The focus group participants defined good customer service by describing employees’ interaction with consumers.

They help you find anything
They are total professionals
It's the way they treat you

Moreover, employees need to be attentive to customers.

Some customer quotes are as follows

"I don't want to see (employees) talking amongst themselves"

"Where everybody knows you... I love shopping in that kind of environment"

A store with great customer service "teaches employees that the customer is important".

Filing your GST/HST returns is now it just a phone call away

The newest way to file your GST/HST return. Business clients can now use GST/HST TELEFILE to file their GST/HST returns in a matter of minutes using their touch-tone telephone and a toll-free number. TELEFILE is a fast, free, and easy to use filing option that cuts down processing time, eliminates the need to mail returns, and speeds up refunds. The new services part of the Canada Customs and Revenue Agency’s continuing efforts to give business clients convenient electronic service options.

What are the advantages of using GST/HST TELEFILE?

It's fast, easy and secure
There are no returns to mail
It provides immediate confirmation when a return is received
It's available Monday to Saturday, except on statutory holidays

Who can use it?

Select business clients will be invited to use this new filing option. To be eligible to use GST/HST TELEFILE, the following conditions need to be met:

The return being filed has to have a nil balance or refund of ten thousand dollars or less
The correct name, business number, reporting period, and address must have been pre-printed on the business’ personalized returns
The GST/HST TELEFILE access code must have been printed on the personalized GST/HST return
The return being filed cannot include a claim for rebates amount on line 111

How does it work?

Using GST/HST TELEFILE is as easy as making a 1-800 phone call. Qualifying clients simply complete a return and call the toll-free telephone number. An automated telephone process will prompt clients to give their tax information using their telephone keypad. Once the data has been entered, clients will be asked to confirm that they want to file information as their return. Clients will immediately get a confirmation number and they return will start being processed.

For more information on GST/HST TELEFILE, visit the CCRA web site at www.ccra.gc.ca/gsthst-telefile.

A Message From The Editor: Tax Cuts Are OUR Agenda

With the federal election now a fading memory, retailers would be well advised to ignore the nastiness and partisan name-calling that characterized it, and concentrate instead on the issues which were discussed; most notably the almost universal agreement on the need to cut taxes.

The Liberal party succeeded in part by neutralizing the tax issue - the Canadian Alliance’s only real trump card. Right before the election call, finance Minister Paul Martin released a mini budget (which the National Post said was an "Alliance Budget") that contained significant personal income tax cuts. If elected, the Alliance would have offered slightly deeper income tax cuts; the PC platform called for more modest personal income tax cuts, but also the complete elimination of the Capital Gains Tax (both the Liberals and the Alliance promised to cut this in half). Even the federal NDP called for cuts to the Goods and Services Tax, although it opposes other tax cuts, and even called for the return of the 5% surtax imposed during the 1980s.

In other words, retailers have a lot to be thankful for; most of the major parties take our concerns seriously, and viciously fight each other for our votes.

Still, the battle for tax relief is far from over, and the other side in the debate gets a lot of airtime on TV. Generally speaking, the opponents of tax cuts say the same things: the country can't afford tax cuts, and people don't really want them anyway - tax cuts are part of some sinister "corporate agenda".

What a load of nonsense! Somebody should inform these nattering nabobs of negativism (to use a phrase from Spiro T. Agnew) that tax revenues are the people's money - not the governments. Moreover, everyone knows that small businesses - not big corporations, creates most of the jobs in Canada, and that small businesses need competitive tax rates far more than corporations like 3M or General Motors. By creating a climate which is conducive to economic growth, the government can bring in more revenues even after tax cuts - as Ontario in the 1990s and America in the 1980s demonstrates.

The next time somebody tells you that tax cuts are part of some "corporate agenda", very calmly inform them that as a small businessperson who plays by the rules, and creates jobs in the community, tax cuts are part of your agenda

A few tips for health product merchandisers...

Michael Halliwell, the Pharmacy Director of Hen House Markets in Kansas City, Kansas knows the natural food business fairly well. "Working with the distributor, we have come to realize the importance of developing an all-around marketing and merchandising program... To make a program such as this successful, you have to remind consumers at every point possible about your message." To accomplish this goal, Halliwell has developed a 7 point strategy to market natural foods which any retailer can learn from.

Natural-fact signs: Over 100 different health-related facts relating to products can be displayed overhead in each store department.
"Did you know" signs: Diet and health information can be provided to consumers on shelf tags.
Reference Centre: An information booth can offer reference books, reprints of health related articles, and a list of alternative practitioners in the area.
In-store marketing: this might include buttons, aprons, stickers, balloons, magnets, bottle-hangers.
FAQs: Your store could post a list of frequently asked health and nutrition questions.
Letter to doctors: Letters are sent to local doctors every time a new natural section is opened, and what the section offers.
Nutrition classes: Customers are invited to attend free weekly classes on topics such as weight loss, cholesterol, cancer prevention and nutrition.

Battling it out with the "Brand Warriors"

Have you ever wondered how the big names in business -- McDonald's, Guiness, Cadbury, Durex, Federal Express, etc. ….. have managed to maintain their commanding market shares? Well, according to a new book from Britain, Brand Warriors: Corporate Leaders Share Their Winning Strategies, part of the answer lies in their ability to develop attractive brands, and update them to changing times.

With the recent publication of gadfly Canadian journalistic Naomi Klein's book No Logo, people often think of "branding" as a sinister process; customers are brain washed into buying products they have no need or use for. After reading Fiona Gilmore's tome (Gilmore provides the introduction to 17 essays by prominent corporate executives), it's hard to think of it that way. Consumers are more cynical than before, and want plenty of information about products; writes Gilmore: "... brands which mouth platitudes such as ‘we are a caring, trustworthy brand’, may no longer be credible. The didactic, authoritarian approach to building trust values can alienate people". Gilmore adds that "consumers in both developing and advanced economies will no longer be patronized". In other words, corporations can’t brainwash consumers, and needs to treat them with respect.

Gilmore also notes a movement away from "pyramidal" authority structures towards "flatter", less hierarchical management structures within major companies. The advantages of such a movement include "more accountability, greater speed and efficiency and, crucially, real focus". An excellent example of this would be McDonald's franchise system; as John Hawkes, the senior vice president of McDonald's UK puts it: "franchisees... bring a wealth of individual flair into the business... and the franchisees have typically signed up for 20 years and because it's their livelihood, they bring a great deal of dedication and energy to a restaurant’s development."

And then, of course, there's the Internet. Gilmore predicts that a "new regularity" will emerge in future retailing in part because of on-line business. The convenience of Web shopping will make consumers more concerned with quality/value trade-offs. "Interactive media can be regarded as both a threat and an opportunity for companies. Technology is a key driver, changing the way markets are and will work."

Gilmore warns her readers that the Web brings risks to companies in the branding business: "If you reduce all of your exposure to a customer down to a transnational, rational, level, do you undermine your ability to create the myth which is the heart beat of a brand?" In an increasingly globalized world with huge numbers of informed, and cynical consumers, a company must adapt to local customs and cultures, and not "become enfeebled by its acceptance of lowest common denominator values". McDonald's India for instance, only serves mutton, chicken, fish and vegetable products - not beef, pork, or their by-products (which is why the Big Mac becomes a mutton "Maharaja Mac").

Small businesspeople who wish to become big businesspeople should know something about branding; Brand Warriors is a good place to start

It's great to be independent

Most small-business people and shopkeepers know that entrepreneurship can be a difficult road to follow in life. The lean years can be most unsettling, and even at the best of times running your own business usually means getting up early, working late and on weekends, and not having much of a social life. Add in the threat posed by chain stores such as Price Club, Indigo, and Wal-Mart which makes independent retailing even more difficult.

Well, according to Tom Zauchna, President and CEO of the National Grocers Association, independent store owners have many benefits: "there’s still a great advantage in having thousands of businessmen living their dream... Just look at their operations, sense of creativity and innovation, which is fundamental. And their timeliness to respond to ever changing market conditions is significant. There's also true sense of community involvement with independents and their associates living as neighbours and friends. They have an unparalleled commitment to the communities they live in and serve.

Still, Zauchna knows that running an independent business is no piece of cake, and offers several pieces of helpful advice. The first is for store owners to expand and remodeled a store on a regular basis; "the day we stop growing is the day we fall behind." Dourioush Khaledi, Chairman and CEO of KV Mart in Carson California, believes that his plan to remodel KV Mart stores every five years has brought a 15 - 25 percent increase in cash register sales; "customers get bored after five years."

A second tip for store owners to position their store as "destination centers" in the community; Zauchna adds, however, that proprietors attempting to follow such a strategy should be careful. Independents usually don't have the money to make repeated experiments. "The simple fact", says Mark Laurenti of Laurenti’s Family Markets, "is that the community makes or breaks a store... If stores don't try to make connection with the community, they are shortsighted. The staff is community to me as well. So I work wherever possible to help them, too." Sean McMahon, President of the Retail Merchants Association agrees that "independent retailers must constantly learned about and understand what customers want."

Store owners might also think about getting active in their communities. Billy Fortin and Yogi Hill, the co-owners of Scott's Corner Market offer a number of community events, such as Senior Citizens Day on Wednesdays (it includes an hour long tour of the store and a 10% discount for seniors), a Boy Scout celebration on February 8, and a casino charity night every spring. Says Fortin about the casino event: "it builds moral. We were able to raise over $18,000 dollars in one night, through donations. It's a win, win, win for everybody!"

And of and then, of course, there's the Internet. Larry Challacombe, the Vice President of AG Ferrari Foods says the company has "been growing organically" since it began using the Internet to change its image from an upscale local market to a national chain with specialty items. "Retailers need to define who they are and what makes them unique and special... We could never compete on price, but we bring great value to our customers. More than having a site is having a perspective. And it may not be for everyone."

Entrepreneurship has its ups and downs, but with a little bit of planning, independent businesses can survive and thrive in the marketplace.

Do you know the new privacy law changes?

According to information provided to the RMA News by the law firm of Borden Ladner Gervais LLP, The Personal Information Protection And Electronic Document Act (Bill C- 6), could affect a number of Canadian businesses.

Organizations which collect, use or disclose personal information in the course of commercial activities will have to comply with the Model Code for the Protection of Personal Information. The law will go into effect on January 1, 2004, but B. L. G. strongly cautions businesses which collect personal information to start planning now.

Who is exempt?

The law does not apply to: a government institution to which the Privacy Act already applies, an individual using or disclosing personal information solely for "personal or domestic purposes, or an organization collecting, using or disclosing personal information solely for "journalistic, artistic, or literary purposes."

Why you can’t wait until 2004:

Provinces have the option of writing similar legislation before Bill C-6 comes into effect.
Bill C-6 doesn't have a grandfathering provision.
Doing so now will give your company a competitive edge

Canadian Retailers Need to Move Quickly to Reach Internet Shoppers

More than 60 percent of Canadian online dollars are spent outside of Canada in 1998, according to a new study by IBM Canada Ltd.

The study, entitled 'Who will win Canada's Internet Shoppers?', revealed that only 26 percent of Canada's top retailers are conducting e-commerce compared with 50 percent of U.S. retailers.

"The report shows that Canadians are slow to enter the e-retail race" explained David Marcus, Managing Principal, Retail Consumer Consulting Practice, IBM Canada Ltd. "Unless Canadian retailers establish an on-line presence in the next six to twelve months, they risk losing traditional store customers and new e-retail shoppers to global competitors.

The total e-commerce market in Canada was established at approximately $5.3 billion in 1998. Business-to-business spending grew 192 percent to $4.6 billion, accounting for 86 percent of on-line sales.

Almost half of the survey respondents said they generally want to buy Canadian and would choose a Canadian site out of patriotism, and more than 25 percent said they would do so to avoid paying U.S. currency

Why we buy: the science of Shopping

New book helps retailers understand customer psychology

Countless volumes have been produced since the dawn of modern retailing telling shopkeepers how to increase sales and keep customers coming back. The problem with most of these works is that they are filled with marketing research and theory or are crammed with statistics and jargon that fail to make a personal connection to human beings. In effect they are a dull read.

Now available is a new book Why We Buy: The Science Of Shopping, that is not only insightful and useful, it's a fascinating page turner. Written in an easy to understand style by veteran marketing consultant Paco Underhill, Why We Buy is part research report and part journey into "shopping heaven and hell." Underhill and his company Envirosell, are credited with inventing the "science of shopping". For almost two decades he has been leading blue-chip clients into the retail trenches. Going beyond merely quoting statistics, Underhill explains to readers how shoppers behave in the retail marketplace, using many concrete examples.

For example, Underhill has found that 65 percent of men who take a pair of jeans into a fitting room will buy them, as compared with 25 percent of women. The full story behind that statistic starts with the cliché that men hate to shop, instead they buy. A man will tend to go into a store with a purchase in mind, grab it and head for the cash register.

On the other hand a woman will not buy something until she has shopped around to compare different makes, styles and prices. Underhill notes that there are "psychological and emotional aspects to shopping that are just plain absent in most men". The author believes fundamentally that women are smarter shoppers than men and he illustrates the differences between the sexes in the trip down the grocery aisle. Women he claims, will read label and compare prices. Men grab things with apparently little thought. Why We Buy contains rich detail regarding how consumers interact with the shopping environment, the salespeople, the signage and displays.

In a section that is indispensable for retailers, Underhill offers detailed descriptions of successful techniques used by store owners to get more business from consumers. Another thought-provoking chapter offers a unique insight into the future of Internet shopping and the effect it will have on traditional retailers.

Throughout the book Underhill direct his narrative pitch at retailers offering practical advice and useful sales techniques that explain why shoppers respond to different stores and presentations the way they do.

Why We Buy: The Science Of Shopping by Paco Underhill is published by Simon & Schuster and is available in hardcover in most local bookstores

Kids flexing consumer muscle.

Today's nine to fourteen year olds are getting better pay raises than their parents and are exerting growing influence in household purchasing decisions.

Canada's 2.44 million ‘Tweens’ control 1.6 billion dollars in income this year, an average of $667 a young person, according to a national survey for YTV. That is an increase of 6.7 percent over last year.

The increase may still be underestimating the buying power of young people because more parents are allowing their kids to use their credit cards to buy merchandise online, explained retail consultant Len Kubas. "We think the use of their parents credit cards is going to grow even further with the growth in online shopping" , he stated.

The survey also found that three out of four tweens get money from parents as needed. As well, the survey found tweens have a significant influence over household buying decisions. 3/4 say they are often consulted when parents are buying clothes, computers, software and even the family car. Parents say they kids influence their buying decisions 82.6 percent of the time.

Sales strategies from an expert.

The following advice is excerpted from the book Pure Selling by Wayne Vanwyck of Waterloo's Achievement .

1. The most important step to increased success is a fundamental change in your own self-esteem, confidence and outlook. This can help you visualise exactly what you want your business to achieve, and is a necessary prerequisite to ensuring that the potential of your business will become a reality. Additionally, you have to be prepared to look at your self as a business and allow full and all encompassing change that will not restrict you or your goals in any way. The importance of this cannot be stressed enough since according to Mr. Vanwyck "your beliefs regulate your behaviour."

2. The one factor separating a professional salesperson from a non-professional, which is "the non-professionals salesperson places his/her own interests first, while a professional salesperson places the customers interests first." Essentially you must assume the role of the teacher or problem solver, and if done properly it can translate not only into an increase in the actual sales you make but also in the value of each sale and an increase in traffic due to your enhanced reputation. Another valuable tool in the market where competition can be fierce is to use "The Platinum Rule" when making a sale. In other words you should treat people how they want to be treated, which translates into sell to people in the way they want to be sold to.

3. An important aspect to ensuring sales is to spend time with those clients who will actually buy - that is, it's important to find out just how serious about making a purchaser potential customer is. This can be easily determined through a series of short simple questions. The key is to find out the following eight things:

What they need.
What they want.
When they want it.
What their budget is.
If in fact they are in a position to make the final decision.
What this decision process will be.
What the decision criteria is.
What is the dominant motive for buying.

Accordingly, once you have determined what type of custom your potential client is and you know the answer to the eight questions above, you'll know how to approach the sale -- leaving you in an excellent position to ensure the sale actually goes through.

4. It's essential that you attempt a few trial closes that play on people's emotions. This will help move them along in the decision-making process, while in the same time increasing your chances for making a sale. The key however, is to encourage emotion not rationality. So after you’ve shown your client their options in a way that they want to be shown, and you’ve determined that the potential for a sale is there, all you have to do it is asked them if they are ready to go ahead with the deal.

Colour basics make any great first impression

Colour is the most influential element of a first impression, whether all of a store, a piece of merchandise, an outfit or interior scheme. Yet colour is very poorly understood. For years we were told the three primary colours were blue, yellow, and red. Any primary school student who has tried to make green by mixing blue and yellow can tell you it does not quite work that way. You end up with a muddy greenish brown.

In fact, science pointed out the three primary colours are cyan, magenta, and yellow. Cyan is a somewhat greenish blue, almost aqua. Magenta is more pink than red. Yellow still holds its own.

Understanding cyan, magenta, and yellow will allow you to create outstanding colour combinations that make an impact. To bring out the colour of an item, match it against its complementary colour, the colour achieved when you mix the other two primaries.

To make your new yellow-labelled product stand out, place it against a blue background. If you want to see red boxes really shine, place them on the table with a cyan tablecloth. Pastels are really tints of a colour [with white added]. Shades are colours with black added. Neutrals are colours with grey added and can be paired with complementary colours.