For Racquet Sports Industry Magazine
February 2007
Successful retailing is more systematic and analytical than ever. For those of us in the tennis industry, it only makes sense to learn valuable lessons from these large and financially robust retailers. One of the concepts they employ is to allocate merchandise space and analyze the subsequent profits by the square foot. They calculate available shelf space and painstakingly set up software systems that measure sales in each shelf and on each portion of each of those shelves.
In a tennis pro shop or specialty store, we can apply this same scientific approach without the same level of painstaking detail that some of the larger chain stores utilize. However, even a simpler approach can have the same profound effects. Here’s an example.
Your pro shop floor space measures 28 x 38 feet. That makes your shop 1,064 square feet in available floor space. Your counter area is 8 feet long and 8 feet deep, totaling 64 square feet. This leaves exactly 1,000 square feet for retail display that can generate sales income and profit.
After measuring your shop, you need to make a list of your general categories of merchandise and space utilization. Here’s an example to get you started.
1. Racquet stringing
2. Racquet displays
3. Men’s clothing
4. Women’s clothing
5. Tennis shoes
6. Tennis strings and grips
7. Accessories including hats, wristbands, etc.
8. Gifts including everything from jewelry to racquet bags
Next, make a rough drawing and convert the 1,000-square-foot shop into ten 100-square-foot rectangles. Then write in each of the above categories. By now you’ve noticed that in this example, we have 10 space areas and only 8 categories. This is where you expand the space for the more profitable categories and shrink the space for the products with lower sales volume and profitability. In this simple example, expand the women’s clothing category into two-and-a-half squares and shrink your strings and grips to half a section. Then, allocate one-and-a-half squares for your racquets and the same for your men’s clothing section.
The main point is to carefully categorize your sales by the product groups such as those we have just listed. Then, evaluate the percentage of your total sales that each of those categories generates. This exercise will give you clear picture of how much floor space to allocate for each category. After you’ve competed this exercise, hop in your car and go to the bank. You should have some extra money to deposit into your account.