Can You Outrun The Bear?
There is an old joke about two campers who stumble across a bear in the woods. Angered at being disturbed, the animal runs headlong at the campers. The campers turn and flee. The beast shows no sign of giving up the chase, so after a while one camper worriedly says to his pal: “I don’t think we can outrun this bear.” The other says: “I’m not trying to outrun the bear. I’m just trying to outrun you.”
In this joke the bear could represent a store closing sale for the the small retailer.
Business for the small retailer has been very tough. How should the small retailer react? Not panicking is a good start. However bad conditions may seem, they will be bad for your competition, too.
This business environment is equivalent of Darwinism – a test where the fittest survive. The primary goal is survival, especially for small retailers that lack resources to help ride things out. Forget profits for the moment. Cash is the lifeblood of a small retail business. Retailers disappear for the lack of cash, not for the lack of profits.
Think about cash, where it comes from, and where it goes. Think also about reserves of cash that you can draw upon. For the small retailer that reserve is your inventory. Identify what you need to do to turn that inventory into cash that will keep your business alive for a month, 3 months, 6 months, and a year.
This holiday season offers the opportune time to turn that inventory into cash. Most small retailers are hesitant to conduct sales in season, but this holiday season should be the exception. Be realistic about your cash needs and take the necessary action to turn that inventory into cash.
CCH Consulting, LLC