The best way to close a retail store is to have a going-out-of-business (GOB) sale. While closing a business can be an emotional and stressful situation, a closing sale can help you offload your inventory while making up some revenue. If you’re closing your store, it’s important to do your research and carefully plan your going-out-of-business sale so that it succeeds.
Check GOB Sale Rules and Regulations
Unlike other sales your business may have held in the past, a store-closing sale needs to follow established guidelines set forth by your state. In most cases, your state’s attorney general institutes these laws.
For example, in Missouri, businesses that are having a going-out-of-business sale need to register with the attorney general’s office and provide a detailed list of items that are being sold. Be sure to check with your state to see which regulations you need to meet, as they vary from state to state.
In addition, you’ll need to decide on your store closing date, after which you cannot sell any additional inventory to customers. This date will be used in your marketing materials and will also need to be provided to your attorney general’s office in most cases. This date is not easy to change due to legal requirements, so it’s important to plan carefully and figure it out.
Make Important Pricing and Discount Decisions
Next, it’s time to develop a pricing strategy for your GOB sale. How much will you discount your products? Will you change the discounting structure during the sale? How long will your sale run? These are all important variables you need to plan before building your going-out-of-business sale advertising.
Many liquidation sales last for several weeks, sometimes as many as 10 or 12 weeks. During the course of the sale, you have the opportunity to change your discounting structure. For example, you can start your sale with all items being discounted by 25 percent. As the sale goes on, you can increase your discount to 50 percent and 75 percent. Some going-out-of-business sales even discount their wares by 80 or 90 percent to ensure they liquidate all their inventory.
If you will no longer be accepting coupons or points from rewards programs, you need to communicate that to customers. Many retailers don’t accept returns during a liquidation sale as well. Be sure to let your customers know when they make a purchase. You may need to place additional signage around your store with these rules as well as include these specifications in your marketing materials.
Maximize Exposure With a Small Budget
Once you have created a discount strategy, it’s time to create your going-out-of-business sale advertising. While you don’t want to spend too much on advertising, you do need to ensure that your local community is aware of the GOB sale so that you are able to liquidate your inventory and recoup any losses.
Some low-cost but effective advertising mediums to consider include:
- Store signage.
- Sign walkers and standing boards outside the store.
- Your social media channels.
- Your website.
- Email campaigns to your customer and prospect list.
- Local radio and newspapers.
- Flyers handed out at key locations in your community.
It’s important to pinpoint the right messaging to entice consumers to come to your GOB sale. Many customers are interested in deep discounts, so you’ll need to mention what kinds of discounts customers will be able to find. Also include the dates of the sale so customers know when they need to make their purchases. Place an emphasis on the fact that your store is closing and that you want to sell off everything. This tells consumers they will find discounts on all items in your store.
- Do not advertise that you are going out of business unless you are really going out of business.
- Some landlords may have restrictions for advertising a going-out-of-business sale.
Anam Ahmed is a Toronto-based writer and editor with over a decade of experience helping small businesses and entrepreneurs reach new heights. She has experience ghostwriting and editing business books, especially those in the "For Dummies" series, in addition to writing and editing web content for the brand. Anam works as a marketing strategist and copywriter, collaborating with everyone from Fortune 500 companies to start-ups, lifestyle bloggers to professional athletes. As a small business owner herself, she is well-versed in what it takes to run and market a small business. Anam earned an M.A. from the University of Toronto and a B.A.H. from Queen's University. Learn more at www.anamahmed.ca.