Chapter 2

Organized retail: The only path to success

Technically speaking, any instance in which a company sells a product can be considered “retailing.” The act of retailing is merely the act of being a middleman between the supplier and the customer or end-user.

However, there’s a major difference between organized and unorganized retail operations.

In the broadest sense, organized retail companies are those that have systematized their operations, developed overarching strategies, and registered their company in compliance with local law.

In contrast, unorganized retail companies are those without standard procedures, that may or may not be officially recognized by law.

Yes, creating an organized retail company requires more effort and initiative than running an unorganized retail store. Of course, this extra effort all but guarantees long-lived success for your business.

How to organize your retail operations

Aside from officially registering your retail business and staying “above board,” perhaps the most important part of creating an organized retail company is how you structure your team.

The process of doing so involves:

1. Defining organizational tasks to be completed
2. Determining what staff is needed
3. Narrowing down the specifics of the tasks
4. Creating a job classification system
5. Developing an organizational hierarchy

Let’s take a closer look at what each of these steps entails.

1. Define organizational tasks

Retailing, at its core, revolves around the mere buying and selling of goods—but the process of operating a retail company is much more involved.

Owners and managers are responsible for:

• Managing inventory and warehouse operations
• Handling employment-related documentation
• Managing team members, schedules, and the like
• Making and receiving payments on both a small and large scale
• Promoting products, sales, and the overall brand
• Developing a cohesive experience for the customer

It’s vital that you have a clear idea of all that goes into managing a successful retail business in today’s — and tomorrow’s — modern world. Though it may be tempting to take a more simplistic, possibly minimalistic approach, doing so will eventually stunt your business’ growth completely.

2. Determine the necessary staff

Taking the above into consideration, one thing is certain: You won’t be able to make it all happen on your own. That said, your next step will be to define exactly what you’re looking for in a well-rounded retail team.

Thinking quantitatively, determine how many staff members will be needed to accomplish the various tasks required of each of the above departments. Focusing on employee quality, you want to have a clear idea of the skills, abilities, and qualifications that will be required of a given team member to sufficiently accomplish the task(s) at hand.

At first, you may be able to take care of some of these tasks on your own (or with relatively little extra manpower). Eventually, though, you’ll need to add more members to your team as your business grows.

Rather than wait until these moments arise, get the list started now, so you’ll be prepared to make the necessary additions to your staff when the time comes.

3. Narrow down specific tasks to be completed

Next, dig a bit deeper into the specific tasks that your various teams will be responsible for.

Here, we’ll take a look at some of the more universal operations all retail businesses will have to handle over time:

• Warehouse and inventory management teams will be responsible for receiving, storing, packing, and delivering products

• Marketing and sales teams will conduct market research, set price points, and develop promotional campaigns

• Accounting and administrative teams will be responsible for documenting transactions, sending and receiving invoices, and remitting payment

• Maintenance and custodial staff will work to ensure your facilities and equipment are able to operate to their highest capacity

There are two main benefits to clearly defining (and refining) these roles and tasks. First, it provides your team with clear expectations regarding their contractual duties. Second, it enables you to quickly create job descriptions when soliciting applications for a new hire. 

Overall, you’ll be better able to cover your bases in the interest of creating a fully-functional, organized retail company.

4. Create a job classification system

Your retail company will be comprised of a number of different teams, each with their own roles and responsibilities.

As your company grows, you’ll want to create a job classification system that essentially solidifies the above processes in a more “official” manner. This will eliminate any doubt as to what a team is responsible for — and keep your employees laser-focused on these tasks.

There are a number of ways to go about creating a job classification system, including:

• By function: As we’ve discussed, you’ll need different teams to complete different tasks, all adding up to a fully-functional retail organization.

• By products: Within your actual store, task different teams with maintaining operations within your various departments.

• By geographics: If you run multiple stores in multiple areas, assigning individual managers to each location will likely be necessary.

Note that you aren’t picking and choosing which of these systems to implement; rather, you need to create multiple systems detailing your organization’s overall makeup. This will become a bit clearer in the following section.

5. Develop an organizational hierarchy

Here, you’ll be taking the information from the previous step, and documenting it in a visual format.

This last image is more along the lines of what you should strive for. As you’ll notice, this model takes into consideration all of the classifications we mentioned above, segmenting them in the most logistically-sound manner possible.

The more clearly-defined a given employee’s “territory,” the easier it will be for them to focus on the tasks they’re specifically responsible for. Having both a text-based and visual representation of your retail organization’s structure will allow you to see where sufficient staff is in place and where additional hires may need to be made.

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