Ep. 93 9 Tips to Help Indie Retailers Mitigate Supply Chain Issues
Every time you see another article about supply chain issues in the retail industry, do you cringe a little bit? It happened to me the other day. A two-minute segment came up about this topic on the nightly news, and I thought, “do I really want to watch this or listen to this again?”
One of our Shopkeepers Lab members recently commented, “the pandemic has been a straight-up pivot-a-thon.” And yes, this is what it has felt like for many of us! Supply chain disruptions are just another piece of the pivoting puzzle.
Supply chain disruptions affect micro and indie businesses in many ways by:
- Reducing revenue
- Inflating costs
- Cutting into market share (because oftentimes the bigger companies are going to get the goods before we do)
- Causing production issues for small makers
However, it’s important to know that there are a number of measures that small businesses can take to mitigate supply chain disruptions—whether the disruptions are caused by the pandemic or not.
An important caveat, though: mitigate means to make less severe, serious, or painful. I don’t have a complete solution and I can’t resolve the issue, unfortunately! I simply want to offer some ideas to lessen the pain.
#1. Work on Your Mindset FIRST
I’ve heard shopkeepers say things like “this is NOT sustainable.” I want to caution any shopkeeper who starts to think this way.
It will be helpful to you if you work on your mindset and start to change this type of thinking around.
You have probably heard me say—especially in recent episodes—how important it is to work on our mindset and our thoughts. I know firsthand that changing our thoughts can be HARD, but it does make a difference.
If we thought 2020 was challenging, I think we’re all surprised at how challenging 2021 has BEEN. And I have no idea what 2022 will bring, but my guess is that it will have its own challenges, too.
The truth is, we never know what the next year will bring, especially as the retail landscape continues to change. Working on our thoughts and our mindset will help us be more adaptable, persistent, and flexible as each challenge comes our way.
#2. Look at your DATA!
In Master Shopkeepers, I’m currently running a challenge where members are looking at their DATA. Instead of saying “I don’t know” or “I’m not sure if I overbought/underbought,” I’m challenging them to take one hour to look at their numbers.
The prize? Well, it’s a $145 candle. Yes, a $145 candle! It’s a candle line that one of our group members will be carrying. It’s luxurious, beautiful, and something most shopkeepers would never buy for themselves!
So, what do I mean by “look at their numbers?” Well, this can be their inventory reports, their sales reports, and any other data from 2020 and 2021 that can help them plan for Q4.
I’m hoping that they’ll apply this challenge to the future of their business. They’ll do this same type of analysis for all of 2022 or for any upcoming season.
Even if you’re not in Master Shopkeepers, I’m going to challenge ANY shopkeeper who says “I don’t know.” This is WHY you have systems in place. This is WHY you painstakingly enter inventory with the cost of items. This is WHY you have a bookkeeper, WHY you have a POS system.
Don’t let these tools and resources go to waste and don’t let that boring data entry work or the money you spend on delegating go to waste. Use your data!
If you’re not a numbers person, let’s at least make you a REPORTS person. Designate one hour to take notes from these reports and compare. See how much you sold, how much you carried, what’s selling and working well, and what isn’t.
Have a conversation with yourself about why one category is doing really well or why one category sucked last year. We tend to go, go, go and push forward, but let’s take some CEO time to look back with the intention of planning for the future.
#3. Change Your Buying Habits
Now that you’ve looked at your data, what can you change? What can you make better? Where do you need to invest more, and where do you need to invest less?
One great example of this came from a Shopkeepers Lab member recently. She makes her own products and she buys zippers. The zipper started to take forever to ship, so she actually had to find a different vendor and order a bulk amount of zippers.
She said it was really scary to make that investment in zippers alone! But it did pay off—she’s been able to help shops that experienced delays with orders from other vendors. And they’ve come back and ordered from her for Christmas because they know she can fill the orders.
#4. Consider Pivoting from China
Before you think I’m being judgy here, I’m not. I sell a mix of items in my store, and some are manufactured in China!
This is simply a suggestion to explore the idea of finding products that are made in other countries, or of course, made in the US. Getting your products from a different country might lessen the effect of the logistical supply chain issues on your business.
I recently had a customer in my own store who talked about her handmade business and how she traveled with a friend to Mexico. Her handmade items support artists/makers in a small community in Mexico. I’m not saying that we all can or should travel to other countries for products for our stores, but it is a good example of how we can start to think outside the box in our product sourcing.
#5. Evaluate Your Existing Suppliers
If there are vendors you order from only during the holidays, call them now and have a conversation with them so you can be prepared.
Suppliers want to keep your business, so reach out NOW to understand what delays you might be looking at for the upcoming holiday season. You’ll want to ask them what your options are and understand what will happen if there are facing a shortage.
I know it can be tempting to avoid making these phone calls so you don’t hear any bad news. But it’s so much better to face it and make a backup plan than to wonder what’s going on with your orders.
#6. Identify Backup Suppliers and Vendors
Many small businesses fall into the trap of relying on a single supplier. You need to have potential backups in mind for moments just like this. While relationships with existing suppliers are important and should be turned to first, they aren’t the only option.
I know this isn’t always an easy process, but sometimes it’s our stubbornness that keeps us from finding alternative vendors. We love their products, our customer loves their products, we don’t want to take the time to find alternative vendors, and we’re frustrated with the situation.
So this is me nudging you that it’s in the best interest of your business to look for backups. While I am a fan of relationships, I think we can become too dependent on them.
#7. Buy Handmade and/or Local!
Of course, this is my favorite. We have many of the brick-and-mortar store owners who buy from the makers in our Shopkeepers Lab group and it’s a beautiful thing to see!
I also understand that this doesn’t always work for ALL business models. For instance, we partner with a local woodworker for some of our most popular items like blanket ladders, stools, growth charts, etc. Unfortunately, with the cost of lumber so high, it has become cost-prohibitive to bring his items into the store right now. We’re hopeful this will change in the future because we’d much rather support his small business than some of the BIG brands we work with.
One great resource for finding local makers are the wholesale platforms that have become extremely popular over the past few years, like Tundra. They sponsored this year’s Savvy Shopkeeper retreat and they are currently offering an incredible deal on orders in the month of October.
Essentially, place an order for up to $150 and get up to $150 in free products from a new brand that you order from. If all brands are NEW to you because you’ve never ordered on Tundra, the offer still applies. Visit www.savvyshopkeeper.com/tundra and sign up for an account with my referral link there.
You can get up to $2000 in FREE product with this offer. I’ve already placed orders with 16 new-to-me brands! There’s no code needed as your cart will update as you add orders to your cart.
#8. Keep Your Spirits and Energy UP
From everything I’m seeing and hearing, 2022 isn’t necessarily going to get any better in terms of supply chain issues. Continue being creative, resourceful, and all the things we as retailers tend to do anyhow. Maybe even try to have fun with this! And if you don’t want to do it, find team members who ENJOY the research and the process of finding new vendors.
#9. Don’t Panic Buy
The last thing that I want to mention is to caution you around panic buying. I don’t want any retailer drowning in merchandise because of fear. I also completely understand how many of us are dealing with half-shipped orders and an alarming amount of backorders. Juggling this can be frustrating!
If this is you, designate some time to go back into your orders and make the calls necessary. Yes, we’ll have to cancel some, and yes, this is a pain. But it’s better than receiving post-season merchandise when it’s either too late or it’s on-trend and won’t sell well next year. We can avoid it or we can FIX IT.
Lastly, keep your chins up, folks. For those of you that are rocking the “pivot-a-thon,” I see you. You’re incredible and you’re a badass. Keep doing your thing!
Resources
- Join the Shopkeepers Lab
- Apply to join Master Shopkeepers — applications are open for a limited time!
- Get up to $2000 worth of free product from new-to-you wholesale brands on Tundra
Timestamps
- [04:13] #1. Work on Your Mindset First
- [05:38] #2. Look at Your Data
- [11:02] #3. Change Your Buying Habits
- [12:01] #4. Consider Pivoting from China
- [14:09] #5. Evaluate Your Existing Suppliers
- [15:39] #6. Identify Backup Suppliers
- [16:53] #7. Buy Handmade and/or Local
- [20:46] #8. Keep Your Spirits and Energy Up
- [21:47] #9. Don’t Panic Buy
