Growing Pains
Many pawn shop operators sit by and wait for customers to come to them. They have no real growth objectives in place. They operate their business by the seat of their pants. The logic is often that they have a decent location, therefore people will find them. They have no growing pains because they aren’t making an effort to grow. Others spend good money marketing year in and year out. They may advertise in the yellow pages, on billboards, in neighborhood newspapers, maintain a Website, send out direct mail pieces, co-operative advertising, and yes, even buy radio and television spots. Unfortunately, too many pawn shop operators stop and do nothing more than spend the money. They don’t or can’t use data to understand the demographic characteristics of their customers, and they don’t use those demographics to target their marketing dollars better. Worse yet, they have no idea what return their getting on the marketing efforts.
It’s not uncommon to find pawnbrokers that can’t tell a bad customer from a good one. For many it’s all about the deal on the table right now. Customer loyalty is non-existent because little is done to recognize and reward repeat business.
Customer relationship management is often ignored in many pawn shop operations. Even proven practices like automatically sending text messages out to remind customers of payments, forfeitures, wanted items, repairs, or layaways is disregarded. Sadly enough, these pawnbrokers stymie their own growth leaving cash flow to the luck of the draw. Some argue that it’s fine because they can sell forfeited items and make a better return, but in reality, they too often sit on merchandise too long and their return suffers. Once more, what pawn software a pawnbroker uses and what data they have to make informed decisions can be the difference between a struggling business and successful one.
| Customer Fraud | Employee Embezzlement | Managing Inventory | Growing Pains | Multi-Store Management |