Update on a budget

In tough economic times, the best way to update a retail space is to do the hard work up front, ensuring that you make smart, informed decisions that improve the in-store experience where it matters to the consumer and increase your store’s profitability. With that in mind, here are some dollar-saving recommendations from the experts at Interbrand Design Forum, Dayton, Ohio:

Audit your space. Understand where opportunities exist to keep the shopper in the store longer, i.e., floor layout, wayfinding, lighting, clutter, space allocation, sightlines, adjacencies, etc.

Strategically declutter. Rationalize merchandise: Would it make sense to move some items out of the store to online-only availability? Or a signage saturation analysis might show that the store is oversigned. Reducing the layers of communication to what really matters to the consumer could shave expenses and improve the experience simultaneously.

Refresh store colors. Simply painting the space is a minimal investment that allows you to be on-trend and creates the perception of a broader refresh.

Update messaging. Graphics and in-store communications are a relatively inexpensive way to update an existing store or roll out a new brand positioning.

Use strategic sourcing to reduce costs. By obtaining competitive bids you can save as much as 20% while maintaining the current level of quality in such areas as general construction, fixtures and graphics. This is particularly effective when a retailer can challenge a long-time vendor to provide more competitive pricing.

Get connected to your consumers. Understanding your customer allows you to prioritize store improvements and invest in the one or two tactics that would delight customers most.

Mine existing research data for new insights. Looking at your business intelligence afresh may help you see where a few well-placed innovations can make a positive impact on business.

Use capital allocation tools to ensure that you invest in places where the shopper gives you credit. You may discover that customers care a lot more about bright lighting or shorter gondolas versus new flooring.

Value engineer. Incorporate value engineering into the design process early to manage the costs of a remodel while maintaining the vision you have for the brand.

Consider owning and operating costs when estimating materials. For example, new flooring may look great but require additional cleaning, which adds greatly to the expense.

Use store design to enhance the perception of customer service, even while staff is reduced. For example, the dressing rooms might have better lighting and more luxurious appointments. The waiting area by the pharmacy might be soothing, comfortable and informative.

Optimize inventory. By reducing SKUs in categories that are not relevant to the brand and/or are underperforming, retailers can reduce inventory expense and reallocate their space in a more efficient manner

Test and refine. To address your needs quickly, a store-within-a store in a high margin, brand-relevant category can create news on a smaller budget, and can then be tested and refined for a wider rollout or expansion as a new store format.

Lock in lower costs. If rollout plans are in your future, consider the fact that the costs for both raw materials and construction are currently down and that now might be the time to move your plans forward.