Paola Stock Doctor

Catherine Erdly: [00:00:00] Have you ever wondered what it’s like behind the scenes of a big retailer? If you’ve ever wanted to know more about the way that big retailers think about stock, then you won’t want to miss today’s episode. Hi, I’m Catherine Erdly. I’m the founder of the Resilient Retail Club and your host in today’s podcast.

I’m also joined by Paola Maggiulli. Paola is one of the Stock Doctors that works with me on my Stock Doctor program. If you want to know more about the stock doctor program, then do head over to resilientretailclub.com and check out the information. Paola has been working with me since last year and she also shares a very similar background to me in terms of the fact that she worked for big retailers for many years before starting her own business.

And I’m really excited for today’s talk where we delve into the true secrets behind the scenes, what it’s like working for a big retailer, why Paola is so passionate about working with small retailers and the differences between how big retailers and small retailers think about their stock.

Welcome to the Resilient Retail Game Plan, a podcast for [00:01:00] anyone wanting to start, grow or scale a profitable creative product business with me, Catherine Erdly. The Resilient Retail Game Plan is a podcast dedicated to one thing, breaking down the concepts and tools that I’ve gathered from 20 years in the retail industry and showing you how you can use them in your business.

This is the real nuts and bolts of running a successful product business, broken down in an easy, accessible way. This is not a podcast about learning how to make your business look good. It’s the tools and techniques that will make you and your business feel good. Confidently plan, launch, and manage your products, and feel in control of your sales numbers and cash flow to help you build a resilient retail business. 

Paola, thank you so much for joining me on the podcast. I’m super excited for our chat today. Do you want to start off by introducing yourself?

Paola: I will, thanks for having [00:02:00] me. So my name is Paola Maggiulli. I am one of Catherine’s stock doctors and I have got 15 years in merchandising experience. From everything from like I met my first merchandiser department was shoes. Moved on to like luxury suits, I’ve done menswear, I’ve done womenswear, I’ve done what else? I’ve done like jewellery to like sofas, I’ve done everything, I’ve done absolutely everything. 

Catherine Erdly: Amazing. I thought it’d be great to have you on the podcast because obviously I’ve talked about Stock Doctor a lot and we’ve had some of our fabulous clients on. And what I thought would be really useful was for people to understand a little bit more or find out more about who are the stock doctors?

And you are the original! And I thought it’d just be worthwhile, just sort of have a general chat about merchandising because often I feel like I don’t know about you, but certainly when I worked in merchandising then, no one ever knew what it was

Paola: I don’t even think my parents even [00:03:00] now know what I used to do back in the day when I worked for corporate. It’s like, what does she do? She works in fashion, but what does she do? Actually no, it’s like Chandler being in Friends. You know, Chandler works in whatever, like, but what does he actually do? Like, no one understands.

And he’s also in data analytics, he was in data analytics, analytics in Friends. And I always feel like, it’s always quite interesting how that part, no one really understood or understands I think when I even start to think about working in the fashion industry, I want it to be a buyer or a designer.

And then I actually, when I looked into a little bit into it and because I was so good at maths, especially statistics. I was like, ” I think I’m actually probably better at this.” I leave the creativeness to my crazy outfits and actually I’m really good at numbers.

Catherine Erdly: It’s funny because it’s the same thing with me. So basically my story about how I got into merchandising, which we’ll go into a little bit more about what it is for the purposes of the listeners. 

My degree was international business and I graduated and I was at the University of Warwick and they would have all of the like [00:04:00] graduate programs come around and interview you for Goldman Sachs or all the consulting firms. And I didn’t get any of those. And left and I went traveling and I came back and I was like, what do I want to do?

I don’t know. And then I thought, “Oh, you know, I’ve always loved retail.” I’d always worked, that was always my Saturday jobs, my summer jobs. That was all shop floor and I was like, “I really like retail,” but I knew I didn’t want to be on the shop floor. And I knew I didn’t want to be like an area manager or district manager. Because I mean, those people, they are so hardworking.

Paola: They really, really are and they work really obscene hours as well.

Catherine Erdly: They work so hard. I remember every time we used to go on store visits, I’d be like, how do you cope without easy access to a kettle? Like in an office, you get so used to having your cups of tea all the time and they would just be on their feet for hours a day. So I was like, I don’t want to do that.

But I liked the idea of retail and what I’ve always loved about retail and still do is that it’s so tangible. You know, it’s [00:05:00] things that we all relate to, it’s buying and selling things that we all relate to. To be honest, I didn’t even know what I Googled. I think I just googled, like jobs in retail or something like that. 

And then it came up with merchandising and all these years later, I remember exactly what it said. It said merchandising, you work with the creative teams. So it’s good to have an interest in product, but effectively you are analytic and you do strategic work and look at more long term.

A s soon as I read it, I was like, yeah, that sounds actually absolutely perfect. And that was it for like 17 years. Then I did 17, 18 years in various different roles in merchandising. I think about two weeks later I got my first job in merchandising. Yeah, so it’s exactly like you say, it’s like the creative bit, but you don’t have, cause I ‘ve never done any creative subjects.

So I was always like, well, being a buyer sounds fabulous, but I don’t have any background in design.

Paola: I always thought I’d be a buyer. And actually throughout my 15 years in the corporate life I did do a role once where I was actually a buyer and the merchandise and that was for luxury branding. So I got insight into that. Which is all, which is all I think it’s been quite useful [00:06:00] especially.

Doing this stuff with you is that I’ve done both sides as well. And I can see like how people can come at it from a creative point of view. But the end of day, the numbers say a lot. But yeah, I’ve always been really good at math at school. I was always really good. I mean, it didn’t sound like the most exciting, like telling my friends, oh, we’re going to work in fashion.

It’s like, “Oh, what are you going to do?” I was like, “Oh, I’m going to work in merchandising.” And they’re like, “What’s that?” And some of them thought it was like visual merch, so they thought I was like dress the windows. Like no, it’s to do with the numbers. 

In the first couple of years in merchandising, it’s very admin based. But it is such a good insight into how accurate your information needs to be and like the information you need to actually pull the analysis required to make these decisions.

So it’s very spreadsheet heavy. But if you’re a spreadsheet lover, we absolutely love it. Like it’s an absolute dream to just kind of like get stuck into the numbers.

Catherine Erdly: I sometimes think that was one of my favorite jobs was my first couple of jobs in merchandising because at that point it was like allocation. So you basically, you sat and they were like, here’s all this stock coming and you had to physically allocate it. And by that, I [00:07:00] mean, go into the system and type in numbers. Like that store gets seven and that store gets eight and that store gets, you know. Like was, it was something really satisfying about it. Was like doing a number puzzle.

Cause then at the end, you’d be like balancing it all out and who got the size runs and all this kind of thing. It was like a strangely satisfying. I think worth just saying then for anyone listening. The way I usually describe it is in a big retailer, there are three product teams.

There’s the buying team, there’s the design team. Most people kind of get what they do. The design team is the creative force. The buying team, they’re commercial. They make the ultimate decisions about designs. And then they do all the work with the suppliers. And then merchandising is how much you’re going to buy, when you’re going to buy it, when do you bring it in, how much you’re going to sell it for, what’s your profit margin got to be? But then also kind of like taking charge of it as soon as it hits. 

And then like, where’s it going? What’s happening with it? If it’s not moving, are we discounting it? And putting very much from like the numbers analytics side. So if we’re sitting in a product development meeting, you know, I wouldn’t necessarily [00:08:00] say, “Oh, I don’t like that. Or I don’t think that’s fashionable or whatever.”

Paola: No, you couldn’t.

Catherine Erdly: No, you couldn’t.

Paola: You couldn’t have. The merchandiser really couldn’t.

Catherine Erdly: But sometimes you could say, interestingly enough, when I look at the numbers, like we haven’t sold green dresses for thee six years in a row. Just putting it out there.

Paola: Yes, there was always a way to put your point across. Exactly what you said. It’s basically as soon as the product comes into the business. It’s the merchandiser’s job to basically look after it and make the most money out of it. It’s basically about being as productive as possible and making sure that the stock is as profitable.

And if it does work, great. Work toward building on that. And if it doesn’t work, then what are you going to do about it? You know, we weren’t allowed to like leave the stock. It doesn’t work because, “Oh, it doesn’t work. Sorry about that.” That our job was to like manage it. Also like for me, like with my last job, my work to Anthropologie.

That was my last job, worked seven years there. It was quite good there because I started working there within the first two years that they [00:09:00] opened the European office. So it was kind of like, given the opportunity, just kind of like own my own business. It was like the first time that I wasn’t being told strategy. But it was also like, because the head office was in America and our offices are just open London.

It was like, okay. Well, you guys need to also work out like how it works for you guys. So I remember when like things weren’t working, you know, we had to work directly with the PR team, the marketing team, the retail team, you know, the online team. And be like, okay, these things aren’t shifting at the moment.

What can we do before we go and mark it down? Could we do something else to help manage it? That’s also like another element of it. It’s great when this products working and it’s selling. It’s like yay, brilliant. This is a great bestseller.

But you know, merchandising is also about dealing with the stock that doesn’t work and how to kind of like not kill the bottom line, basically. And try and make as much money out of it as possible, but without completely killing it so.

Catherine Erdly: And also learning to go forward so that you don’t make the same mistake again.

Paola: Exactly. And it’s like taking that analysis, taking that history. Doing those [00:10:00] sort of like strategy product meetings when you’re building up your next season and going like, it’s looking at what works, but also remembering what didn’t work. So you don’t make those repeated mistakes again. All good times, all good times.

Catherine Erdly: And so tell us a little bit about your journey, ’cause you have your own small business as well, so you’re not a stranger to the world of small business.

Paola: I am not. I’ll tell you what, though. It was quite interesting when I was thinking about it. So obviously I have my own small business, which I’m going to touch on in a minute. Like exactly what I do, as well as doing Stock Doctor. But my dad used to have an Italian deli for 20 years. And actually my small business is in Italian food and cooking and that side of things.

But I remember I would have to go and work on the weekends. Like I used to really, really hate it. But one of the things my dad used to get me to do was to count the stock. So we would have to, especially like after the weekend. So I had to do my gap year with my dad. And on a Monday morning, I would have to go on every single stock shelves and I would have to count.

How many we had. I had to basically [00:11:00] fill up the shelves, tell my dad how much, so if the box was empty in the stock room, we knew that I had to reorder it. So it’s basically, I was doing stock management from the age of like, God knows, 15. But yeah, I remember doing, I used to love it.

I didn’t really like selling so much behind the deli, but I used to love helping my dad like rearrange the shelves, bring the deliveries in. Making sure that all the stock was out and all that sort of stuff. Yeah, so my dad had a deli and then basically from that, obviously I’ve mentioned I was in corporate merchandising for 15 years. And then I had decided that I also had this insane passion for cooking and Italian food and things like that.

And so for the last 16 years, I’ve also been managing a small business. Which is basically, it’s not just a cooking school. It’s like teaching people to take better care of themselves through cooking. 

Catherine Erdly: Mm. 

Paola: I understand, especially, I’m sure lots of people that are listening to this, they probably don’t even have time to take care of themselves. But I talk about the importance of having to take care of ourselves so that we can actually go on and be better at all the things that we want to achieve.

And all the [00:12:00] goals that we want to hit. So I understand exactly, it’s crazy because I went from a corporate world, where you know everything’s very structured. And then I started this business and I’ll tell you from the beginning, it was not structured.

I was like, what am I doing? How am I promoting this? What do I need to do? And like over the years it’s been a journey, but I know exactly like going from corporate and working for someone else who basically pays your paycheck every month. And making millions for other people to then creating a business when you’re making money for yourself. 

Catherine Erdly: Yeah.

Paola: The journey has been wild. I’ve got so much experience on running like big businesses. From luxury to high street lifestyle brands, I’ve done it all. But even when it’s your business, even though you have all the intention to keep a level head, you can get so emotional about it. You want things to work. You want things to succeed.

You know, when I was in merchandising, my job was just merchandising. I didn’t get involved in the marketing, the PR, how things looked online. My job is doing all of that. So I’ve [00:13:00] had to take what I’ve learned in my corporate world, put it into my small business and I’m still learning. 

Like it’s still things that I feel like I could be doing better. But I think that’s the beauty of small business is that actually you have the say to say, “this isn’t working for me, let me do something else.” Let me go into another direction. 

When I left the corporate world of merchandising, shall I say. It wasn’t because I didn’t enjoy merchandising, I just didn’t enjoy doing it for corporates anymore. It didn’t feel very fulfilling. Making millions, millions for these companies, millions. I cannot tell you. You know, like I work in Anthropologie. I had the second biggest, I worked on home ware furniture, so it wasn’t the biggest area. Women’s wear is, but it still made millions a year and to think you put all the effort in, all the hours in and I was like, but it just felt quite felt quite thankless after 15 years.

It was like, I feel like I want to do something else now. So I’ve taken, even though obviously it’s cooking, but you have to take some of those skills that you learn from there, like even like pricing and managing my [00:14:00] costs and all of that sort of stuff. It’s all part of running a business.

You can’t run a business if you don’t know how much things are costing you. Right now, I do Stock Doctor, which I absolutely love and adore. Like it’s reignited my love for merchandising. But then it also reminds me like the people that. It kind of is quite a good insight for me, I’m seeing the women that I kind of would love to work with me also on the cooking side because I see how hard they work and it’s like, Oh my God, you’re doing such an amazing job, but are you taking care of yourself?

Are you eating well? Sometimes I’m like, sometimes I’m like, have you had dinner? Have you had lunch today? Because I kind of go into like Italian caring mother mode of like, are you taking care of yourself? Are you eating well? Because I know from my experience, like how important it is self care is to take care of yourself.

I know how many people plates were spinning and how many hats were wearing every single day, so.

Catherine Erdly: It’s so true. No, I completely agree. And I think as well, I think the thing is that behind a lot of these very brands that look so lovely and warm and fuzzy. Or are really desirable from the outside, like a [00:15:00] lot of corporate retail is really toxic.

Paola: I have to say, when I started at Anthropologie it was lovely. I really loved it. It was really, it was run by all the heads. Like all the main heads, should we say like the CEO, the head of design, the head PR. And we talk about the US, they were all run by women and I loved it.

I loved it. I loved how this big company was run by women. And then over the years. Yeah, things changed. And I was a bit like, but it was great. To be honest, it was one of the hardest places ever worked up, but it was my favorite because of how much autonomy I had in running my business.

And it was very successful. I’m very proud to say that I took homewares to a different level in my seven years there. I started on accessories for two years and then I did homeware for five and a half.

And I’m just so proud of like me and my buyer and our team that we had, because we had like 10 people that we were managing or more. I think it was I think it was like 12, [00:16:00] 14 people were managing towards the end. Got this area just everyone always always say to me Anthropologie and they really think about the women’s wear, they think about the home wares. 

Catherine Erdly: That’s so true.

Paola: But yeah it’s good times. Good times but it’s lovely working for, like you say, aspirational brands and small businesses. And helping them see that there’s more to you know, there’s so much more they can actually do to their businesses and help them grow that.

Catherine Erdly: Yeah, I think as well. I was talking to somebody about the retail industry and we were saying how hard it is and how toxic it can be. And then I was like that’s the beauty of small businesses. It’s not easy, but my goodness, the people are so amazing and so passionate and it’s just such a different experience working with small businesses. You know, it’s why I absolutely love it.

Paola: Yeah, same. I’m so glad that you reached out because I didn’t think I’d ever go back into it. And then as soon as like I had my first couple of clients, like, “Oh my god, where have you been? Where have these spreadsheets been all my life?”[00:17:00] 

Catherine Erdly: It’s so true though.

It’s so true because I completely resonate when you said itu wasn’t that you stopped loving merchandising. It was just you didn’t didn’t want to do it in that. And that’s certainly how I felt. Like I absolutely loved. You know, I loved my team. I loved the work.

Absolutely loved it. But just the politics and some of the other aspects are just.

Paola: The push and pull. You know, you want to do this, someone else wants you to do that. And you’re like, hmmm. 

Catherine Erdly: Or the blame.

Paola: The blame. Someone always had to take the flak for something. And it was so like, can we just not move on? Can we just like, that’s been done now? We can’t do anything about it. Let’s move yes on. No, I get PTSD at this.

The biggest difference between how small businesses deal with their stock vs. big brands

Catherine Erdly: Let’s talk about small businesses. So what’s really fascinating and I’d love to hear your perspective is when you think about the way that we’re trained and drilled in stock management, and then you come in and you work with small businesses. What do you think is the biggest differences about the ways that small businesses think about [00:18:00] and deal with their stock compared to big businesses?

Paola: The biggest thing I’ve noticed is that when I sat down with all my clients, like the first thing is like how reactive they are to their stock. So it’s like anything they do with stock in terms of what they buy. What they’re putting out, like maybe what they put in windows.

It’s very reactive. It’s based on like what they’re seeing on the shop floor. And it’s very much like what the customers are buying. Which obviously is the essence of merchandising. You’re looking at what is actually selling, but then it kind of stops. There aren’t any real processes put in place, apart from this is what I would like to buy. 

Maybe they look at what they sold last year and they kind of like come up with, I think I’m going to buy this, this, this. But there’s no, the difference with merchandising in big corporate companies is like you say, there’s a whole team just to look at the figures, to dissect the figures, to analyze the figures.

People in that, because their role is to kind of like make sure that stock is as productive and as profitable as possible. But when I speak to my [00:19:00] clients, they’re all amazing at what they do. But when it comes to this side of things, like data analysis, most of them say to me, “I hate spreadsheets.” And I’m like, “oh.” and I’m like, okay, because numbers isn’t for everyone. But it’s such like, because they’re amazing because they do everything.

They work on a shop floor, they’re putting things online, they’re sending out their emails, they’re ordering what they’re doing all these things. But it’s like the one thing that they’re missing is the merchandising bit. And it’s because some of them aren’t comfortable with numbers. And I totally get that, because numbers can be scary if you don’t know how to manipulate them the right way.

So for me, it’s just more of a case, not that they’re not capable of, I think it’s just like we went and learned. I did fashion and merchandising at London College of Fashion. I learned there. And then obviously when know when you start offering merchandising, you go through the ranks, don’t you?

They teach you. 

Catherine Erdly: yes. 

Paola: You learn. It’s so when I speak to these girls and it’s like, and they get frustrated. Like, I dunno why I’m not doing [00:20:00] it. Like, I just don’t like the numbers. And it’s like, listen. You don’t just know this stuff. Like I don’t know this stuff. Catherine doesn’t know this stuff.

We’ve had to learn how to do this. So I don’t want you to like put too much pressure on yourself or you think you’re not doing enough. This is a part of a business that hardly anyone talks about. Like being a small business. You know, I follow so many people that have their own small businesses or coaches or things like that.

And when people are talking about selling their products and their brand they talk about so many amazing things they can do. Talking about how to sell, how to market, all this sort of stuff but when it comes to talking about what actually make a business grow.

Like the backbone of your business is understanding your numbers, understanding what your stock is actually saying.

And I think that’s the main difference is that these women are so passionate, they’re so amazing, their businesses are fabulous. But they just haven’t understood that how much power is in understanding what their stock is saying. And it’s just because they’re not [00:21:00] comfortable or confident enough to understand looking at numbers, what they mean.

And that’s kind of what the stock doctors are doing. It’s like obviously, I’m telling them and giving them my advice. But I also, it’s very important that they understand why I’m coming up with a numbness. Like what? Why have I come up with that? What is this variable saying that is helping me tell you that this is what you should be doing?

So I think that’s the main difference is that they’ll wonder at doing everything else. It’s just something that people don’t really talk about. You talk about it, like you’re the first person I’ve ever come across that talks about merchandising. And all the people that I follow, there’s no one else does.

They talk about how to do all these other things. But I’m like, you can do all those other things, but they can only take you so far.

If your product isn’t right, or you don’t know how to manage it, then how can you grow as far as you’d like to go? But some of these businesses, some of these clients I work with, they’ve done a fantastic job without it.

Like to this point. But they’ve got to the point now where they, you know, they’ve got too much stock. Or they’re not buying into the right thing. It’s like you’re never going to be able to grow that extra 20-30 percent on that next year. If we’re not dealing with what you’ve got here.

Catherine Erdly: Yeah. No, [00:22:00] completely. I know, I completely agree. And I think that it is such a crucial part of it. For a product business, one of the issues is that lots of people give business advice, which is more service based business orientated. And we both run service businesses, so you know that it’s very different kettle of fish.

Oh, it’s completely different in like, there’s so more in product business as the service. 

Paola: I feel like they do the service, but because they also do the selling and the email marketing and all that sort of stuff. But the product is, there is so much more you have to do with product because it’s actually there.

It’s tangible. With our service businesses, it’s an intangible thing, so it doesn’t have, it has a cost to it. But not the same way as a cost as an actual product.

Catherine Erdly: Yeah, yeah. And it’s a big cost. Your biggest business cost usually is your stock. And I think for me one of the biggest business differences as well is that in a big retailer, there is a hard limit. You’ve got your stock limit, and then that is it. If you’ve said you’re gonna have 52 million pounds worth of stock at the end of March if you’ve got 55 million [00:23:00] pounds worth of stock, there’s a problem So, you know you have to deal with it. You said if it’s not working, you’ve got to deal with it. You can’t just keep bringing more stock in instead whereas. Of course, small business owners. A lot of the time they’re not working from that perspective. They’re like, “oh well if I buy this other thing then maybe it’ll sell.” Or you know, “I just love that. I just want to buy it. I want to bring it in,” but they don’t realize, there’s a reason that there’s stock limits in a big retailer and it’s because to keep costs under control and to keep that managed and keep the bottom line ticking over. 

Paola: Yeah, and get cashflow. Get the cash flow. And that’s the thing with these small businesses, they want better cashflow. And it’s like, you’re gonna get better, you’re gonna get better cashflow if your stock is as productive as it can be.

If your stock isn’t, if you’re sitting on all this stock and you’re like, “well, I don’t have the money to spend,” but your stock isn’t moving, we’ve got an issue. So it’s one thing. And I think what they do is that they know their business, they know what sells. But I think teaching them and make them understand about, you can like things and you can see what’s selling. But it’s really understanding like, what is it that my customer wants [00:24:00] for me?

What is driving my top line? What is it that I need to be, what I need to be focusing on? And then the flip side is what isn’t working? What can I do to keep this moving? How can I get cash out of this stock that isn’t working? What is the best steps for me to move forward? Cause you have to keep it like you’re saying before, it’s all about just moving forward.

It’s always about moving your business forward. And if you’ve got stock that isn’t working. And you’re not doing anything about it, it’s going to always be there. It’s always going to be a problem if you don’t face it. And I’ve seen with my clients, as soon as we started resolving it, the relief they have like, “Oh yes, okay. I don’t ever want to see that again.:

We’ve got rid of it now. Let’s move on to the next thing. I was like, yes, exactly. Let’s get excited about the new things, the things that we know are going to work. You’ve learned that lesson. You tested out, didn’t work out. Let’s move on to the next best thing.

Catherine Erdly: Yeah, amazing.

Paola: Make money. Let’s make money.

Catherine Erdly: Yeah, absolutely. That’s the thing I would say, merchandising is about how to creative ideas make money basically, isn’t it? You know? So yeah. So [00:25:00] talk us through some of the kind of biggest light bulb moments you feel like clients have had in Stock Doctor.

Paola: I think One of the main things is understanding that promotion or marking down isn’t a poor reflection of your business.

Catherine Erdly: Mm. 

Paola: So we had, obviously we’ve had Christmas recently,

Catherine Erdly: Yeah.

Paola: There’ve been a few of my clients. They’ve had some great last six months and their sales have grown.

 But when you actually look at their stock and look at where the stock is sitting, there was a few areas for some of my clients. Like this is an issue. I don’t know if we can go into the next, like if you want better cashflow, we’re going to have to deal with this stock now. Because otherwise we’re going to keep on building your stock up and you’re going to be sitting on this stock.

So, and I remember having a few conversations like, “Oh, you know, I just feel like marking down is like, people are going to think that my business isn’t great or there’s something wrong with my business. And I’m like, but every high street does a markdown, but we don’t? I still go shopping Zara and they’ve got, you know. [00:26:00] And what I did this year when over Christmas on my clients is I actually went look, “I know it can be quite daunting.

You’ve got so much product. Let me just have a look at your product. Let me just put together a list of things that haven’t sold in the last three months and things are really, really slow. I’m not going to tell you that you have to mark it down, but I want you to look at these products and be honest with yourself. Do you want to keep these items full price in your business going forward next year?” 

And the feedback was like, I have never done that exercise before. It was so cathartic to actually say, do you know what? I know that’s ticking along and it does make some money. But it’s not really doing what I need it to do.

So I’m quite happy to take off 20-30 percent off at Christmas, get rid of it, and bring something in. And that to me, seeing that light bulb moment for them, and then actually realizing it’s not a reflection of how bad your business is. It’s a reflection of you being a great business woman or person and doing the right thing for your business, so that you can bring in more stock in so you can make better sales.

[00:27:00] I feel like it’s the same. I know what it’s like. When I put out, say, a service and I don’t get that much uptake for it. So I put out a course and I don’t get many people sign up for it. You take it personally. You go, “Oh, I didn’t do very well. Like I must be doing something wrong.” You get really personal about it.

But at the same time, the right answer is like, “well, it didn’t work. Let’s do some market research. Let’s look into the figures. Let’s talk to people. Let’s see what people want. Let’s give them something that they want.” It’s the same with products. If your figures are saying something hasn’t sold, no one has wanted to buy this.

It’s been sat in the middle of your shop floor for three months and you sold zero. Then why the hell are you not going to mark it down? 

But also like talking about selling and be like, you want people to buy this product now. So you need to tell people that you are on sale again.

Do not be ashamed of being on sale or promoting. It’s fine. You know, it’s that light bulb moment of them actually understanding. It’s like, this isn’t a reflection of you doing something wrong. This is a reflection of you, like managing your stock and moving in the right direction. And seeing them do that with confidence has been great because you can [00:28:00] see that they cleared that stock out.

They’ve got now cash to buy more exciting things. And now we’re looking at how those things are performing. And they are. So it’s like, great, that was a good decision for you. But I said, you don’t have to do this. This doesn’t have to be big every year. It’s just at this point.

You’re in a bit of a stock situation. Let’s look at it. Let’s move on. And now this year we can focus on bringing more fresh, exciting things for your business. Cause that’s what I also, I think it’s another light bulb moment is that some of these stores will have product they’ve had for a long, long time because it does sell.

But I always say, I know that if I walk into a store, I don’t want to see the same stuff all the time. We need to bring newness in.

Catherine Erdly: Yes.

Paola: It’s about having that balance of and I think that’s another light bulb moment. Like I say to my client, like part of your business is having core lines, things that you always have all year round, and they do really well and they take certain amount of money. But it’s also important to spend your money on things that are going to be exciting for your clients.

They’re going to want to come into your store, see what’s going on. I think those two things for me, the two things is like, understand that promotion is not [00:29:00] harming your business. If you need to get rid of the stock, if it’s not working.

Catherine Erdly: And if it’s targeted, cause that’s the real key thing, isn’t it? It’s like if people run 20, this is why I’m not a fan of these blanket promotions. Like 20 percent off everything, you know? Okay. Fair enough. If you’re doing it once or twice a year, it’s like your big push. But generally speaking, you want to use your discount to shape the customer behavior.

So you want them to be buying the things that you know aren’t selling. Rather than just letting them take whatever they like at 20-30 percent off.

Paola: Oh, absolutely. Yeah yeah. It’s not about marking down everything. It’s like marking down the stock. That’s the thing. That’s what I’ve always done with all my businesses. Like I’m never going to mark things down that are working. Why would I? 

But if something’s sitting on your shop floor, like you say, it’s a targeted promotion. So that you’re getting people to buy into something that maybe hasn’t really worked for you.

But then you’re bringing that cash that that stock is releasing the cash flow for you. So that you can then go and spend things on the things that are selling really, really well. And it’s that nice cycle, isn’t it?

Catherine Erdly: Yes. Oh, well, [00:30:00] thank you so much, Paola. I feel like we could keep going because I’ve really, really enjoyed our conversation, as always. I always enjoy chatting. But thank you so much. I mean, yeah, you do amazing work for the Stock Doctor clients. It’s fabulous having you on board. 

And do you want to just kind of finish off by saying like, what are some of your favorite things that you enjoy about working with small businesses?

Paola: I think my favorite thing is just like, I know exactly what it feels like to be a small business owner. I know how many hats we’re wearing, I know how many plates were spinning. And I know how sometimes it can be quite emotional at times and I know being a service provider that sometimes you just need someone in your corner to help you. 

And like I say, merchandising is so key to helping a business be successful. So for me, being that person for these amazing business owners that have these fantastic businesses and actually just, I guess it’s enhancing what they’re doing. Do you know what I mean? It’s enhancing what they’re doing and seeing for me, it’s the confidence that I see in them.

It’s the energy that they have at the end of every call. It’s a t the end of every call, we have [00:31:00] tasks that we give the owners for them to go away to do things to enhance their business and they’re just so on it and they’re excited. And they can’t wait, you know, and every month they want to know like, how did this do?

How did that do? And it’s like, you can see it’s like a whole, it’s a whole different energy rather than buying stuff that they want to sell. It’s like, they understand that they can understanding. They can see the science that’s kind of going into it, but it’s not boring. It’s exciting. And I love, and that’s like the most exciting feels so much more fulfilling to help a small business owner than these corporate people, because I feel like what the corporates do.

Catherine Erdly: Yeah.

Paola: They’ve got it down. And it’s like, I just wish more people knew that they could take what these big corporates do and apply it to their small businesses. And also they could be as successful as they want to be. And I just love being that person that can kind of share that knowledge with them.

Catherine Erdly: Thank you so much for tuning in.

If you want to find out more about Stock Doctor then head over to resilientretailclub. com and click on the Stock Doctor page. You can find out all about how you can have [00:32:00] somebody like Paola in your business helping you get to grips with your business numbers. And making really great commercial decisions that move you forward and save you money.

And if you have a moment to like or follow the podcast, depending on which platform you’re on. Then you’ll be the first to know about each new episode when it comes out on a Thursday morning. See you next week.