Product Selection for a Small Retail Business

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Small Retail Business

Whether you run a small brick-and-mortar store or are just getting started in ecommerce, product selection is probably the first thing you thought of back in the days when things were just getting going. It is impossible to recommend specific products for a small business, simply because that depends on the type of business. But it definitely takes a certain amount of wisdom as to how to tackle the product section for a small business. The only hard and fast rule that can really be given, however, is that the products must be sellable.

Small Businesses Product Selection

With small businesses, product selection has a series of limitations placed upon it. One of the most important of these is that small retail businesses will rarely be manufacturing the products themselves (although there are many cases of this). Instead, the so-called “supply chain” of manufacturers, wholesalers, and retailers needs to be deferred to, and the products need to be easily sourced in this way – and not run out!

Regarding the difference between online retail and brick-and-mortar stores, it should be noted that, fundamentally speaking, product selection is no different between the two. There are very few things that can only be sold in one or the other. So, you should approach product selection in a broadly similar way in each case. That said, you may find your decisions being influenced by the nature of your business, online and off, simply because your products will need to be shipped in the latter case. Depending on a few factors (most prominently product size) this can incur extra costs, and so smaller businesses might select fewer large products.

The difference though is not significant, and there are in fact far more important factors to consider when it comes to selecting the products you will sell.

Important Factors

Let us look at some of those factors now:

Marketability

At the end of day, it hardly matters what products you are selling if your customers are not buying them. For small retail businesses, the products you choose will be closely related to your brand and how you market your products through it. This means that not only should you invest in products that are marketable in a general sense (think, “what do people need/want?”) but marketable within the context of your retail store. Feminine beauty products are extremely marketable, but not in a fishing tackle store!

Versatility

Olympic Eyewear, a company offering discount designer sunglasses in bulk, say that the variety of businesses that stock their sunglasses is exceptionally large indeed. Why is this? It is because sunglasses are an incredibly versatile product (from the merchant’s point of view). It is a good idea to stand out by specializing, so you shouldn’t go overboard with these types of products, but stocking a product that pretty much sells anywhere is a solid move.

Profitability

Naturally, you are going to want to see a profit on everything you sell, but some products can lead to rosier margins than others. Products that are sold wholesale are particularly good here because the price you pay per unit is hardly anything compared to the amount you can make selling them individually. Different products have different profitability and, for small businesses, seeing products in terms for return on investment is the way to grow and be able to apply more investment in future.

Bottom Line

As mentioned, we cannot recommend individual products because that depends entirely on what business you run. But for small businesses, the way to start growing is to stock products with marketability, versatility, and profitability firmly in mind.