Retailing Right

With retail sales suffering as a result of the current economic crisis, it's difficult to not want to throw in the towel. However, there are steps you can take to get your retail inventory moving. Mii amo, a Destination Spa at Enchantment (Sedona, AZ), has consistently shown better retail sales from its spa treatments and spa boutique than others in the industry. On average, for every $100 spent on a spa treatment, resort and hotel spas average 15 percent in retail sales. High-end day spas average 18 percent, and destination spas average 22 percent. Mii amo outperforms them all by averaging 28 percent. Take a hint from us, and consider the following tips:

1. Work With Vendors to Offer Incentives

Incentivize your clients to create loyalty. Incentives can be as small as a sample of a product that is recommended by a therapist. This is an added value that is often offered free of charge by vendors. Partner with them for a day of beauty in your boutique or store. Your vendors can offer in-depth information that perhaps your staff is unable to give, such as manufacturing procedures, procurement, and brand mission.

At Mii amo, we advertise this in-house through our events calendar and individual room drops. Our designated vendor partner sets up specialty displays. Clients view this as an opportunity to receive an informal consultation. During this time, vendors may stimulate sales by providing a free full-size product from their inventory with the purchase of two products from our inventory. This may be just the push a client needs to purchase.

At Mii amo, we created a voucher to encourage guests to visit the other retail stores on property. When they spend a set amount in the Mii amo Boutique, they are given a 15 percent voucher for one item only that can be used in the Enchantment Resort shop. This discount is valuable to the guest but doesn't negatively affect overall sales cost.

2. Partner with Locals

Because your local retail partners can identify with your particular market challenges, buying locally has many advantages. They may be willing to deliver product personally or waive minimum order requirements. Local products are ideal for vacationing clients who are looking for a unique or regional gift. Also, consider promoting local artists. They may be willing to commit to a show at your spa on a consignment basis, which lets you reap the profits from merchandise that isn't in your inventory until it is sold to the end user.

3. Focus on Offering Unique Value

It seems logical that in bad economic times, a bargain will be better received than a luxury item. The value of your goods and services is not necessarily enhanced by discounting. However, being aware of your best price points is key. Search for items that are exceptional for their price.

Destination spas also create exceptional opportunities for retail sales because your employees become the experts in the eyes of your clients. Our clients continue to purchase their skincare products from us long after they've returned home because of the value of having developed a relationship with an expert who is always willing to answer questions and assist in product selection.

4. Utilize Your Point-of-Sale (POS) System

With the assistance of technology, a company can look at data in real time and determine what products are selling best. Once the best-sellers are identified, you can figure out why. Is it because of their placement in the store or their price point? If you are on top of your technology, you may be able to increase your turns of inventory. This will allow you to re-adjust your inventory to consist primarily of best-selling products and reduce your mix of slower moving merchandise.

5. Don't Think of Retail as an Amenity

Oftentimes, a spa director is tasked with running every aspect of the spa, including the retail operation. In many cases, retail offerings are viewed as amenities, but they can be so much more than that if the proper people are in place. It is important to have a buyer in place who travels to markets and trade shows to find those new, unique, and essential offerings. It is crucial to have specialized retail management on staff who understands financials, optimum inventory levels, and how to anticipate changes and react when there is a shift in the market or your clients' buying patterns. Your spa director should not be expected to do the many detailed tasks associated with a successful retail operation. Only when you give your retail operation the attention it deserves will you reap the rewards.

Mark Grenoble, president of Enchantment Group, is responsible for the operations of Enchantment Resort and Mii amo in Arizona and Tides Inn in Virginia. He is a board member of the Resort Committee and American Hotel & Lodging Association and chairman of the Arizona Hotel & Lodging Association.