SPEAKER_00 0:01

Most product-based business owners think they need something new to grow, a new strategy, a shiny tool, a game-changing idea. But the truth, you don't need more exciting. You need what actually works. Because the businesses that win on profit and cash flow, yeah, they've mastered the fundamentals. And this is exactly what we do inside the Inventory Genius program. We clean up your financials so that you have a clear, accurate picture of your inventory and your real margins. We fix your product mix, making sure every single SKU is actually making you money, not just creating revenue. And we build a profit plan so that you can pay off debt, generate cash, and run your business with confidence. No fluff, no guesswork, no chasing trends, just a proven system that helps product-based businesses win again when it comes to profit and it comes to cash. Because long-term success isn't flashy, it's consistent. Join us in the Inventory Genius program. Let's make your business work for you. Hey friend, welcome to the Inventory Genius podcast, where we work together here to make you an inventory genius. We talk about profit, we talk about cash flow, and we definitely talk about your paycheck. Because at the end of the day, it's all related to your inventory. Let's go. Lisa from the Get Up. She has an awesome store concept. Actually, I'm gonna let her share because we've never had a guest on with this type of inventory-based business before. So I'm excited to chat with her. But we've been working together in different capacities over the last year in the Inventory Genius program. And she's made so much progress. I love working with Lisa. I'm gonna miss um just having our one-on-one calls for sure. But I wanted, I know they're so good every single time I give you homework. That's what I feel like. But um, you've made so much progress in your business and just finding clarity. And so I'm excited you're here to chat with us today. Thank you. Uh I'm gonna be fun. Yeah. So tell us how you sell inventory.

SPEAKER_01 2:28

So we are a resale store. We buy and sell our inventory, and so we um sell everything from newborn clothes through adult clothes. We sell accessories, um, kids' gear, toys. So it's a wide variety of inventory.

SPEAKER_00 2:50

Yeah. So I remember when you first started an inventory genius, the first financial or numbers-related uh topic we tackled was this idea of cash and credit. Because you have, because of your business model, you're not going and just purchasing inventory for cash. So you're also offering your customers the idea of credit. And so that was adding a little bit of confusion, cloudiness when it came to the numbers. So let's start with that, where you were and how you've changed or what you've discovered. And then we're gonna dig into some other discoveries you've made when it comes to your finances.

SPEAKER_01 3:26

Great. So, yes, we um, you know, a lot of resale stores are consignment. Um, but our whole mission at the getup is to support our community. Our tagline is community-supported sustainable styles. So we focus on community and sustainability. And so when we were thinking about our business model, the idea of giving our customers the option to take cash right away to put back into our community, basically, um felt right to us. So we chose uh buy outright versus consignment. Um in the thrifting world, that is kind of um, and the concept of thrift too, right? That um some stores are just donation-based where they just get their inventory and then they can price it at whatever they want. There's no cost of goods sold really. Yeah. Um, and then there's this buy outright or consignment. And so people, I always I explain that almost every single day to our customers what exactly that means. So we offer cash, or now it's 10% more in store credit. So I'll get to that. Um and so customers can um choose that option. So I have just had a lot of um, I haven't really known how to dig into my numbers to really see w how um our profit is being made. And so that's why I started working with you, is because I was trying to figure it out. And for the longest time I've was working on my cogs specifically, my cost of goods. And it was really high when I first started trying to find people to help me work on it. And to most business people, they're like, well, what's the problem? You know, your cogs are high, just adjust your cost of goods sold. And um, you know, just adjust that the what you're paying. And but that was I didn't know how to do that, you know. So the one of the first things that we looked at was how much I was paying in store credit.

SPEAKER_00 5:35

Right.

SPEAKER_01 5:35

Um, and I realized that I mean, I've adjusted it a few times throughout, we've been in business almost nine years. Um, but at first I was, you know, I would, because I wanted to support my community, I'm in a small town, I'm like, oh, I want to help people out. I want them to bring their stuff to me. Um, they'll come back and shop. But I oftentimes would bump up just to get people to bring their things up to 40% back cash payout. Now, 40% back in consignment, when you can just give that item back, if it doesn't sell, it's no risk to me. But that's fine. But when I'm paying cash for it and it doesn't sell, and then I'm responsible for getting rid of it, um, it does not work in a buyoutright model. So that's why you'll notice if you take your clothes to sell them at other businesses, um, that oftentimes the payback is higher in consignment than it is in buy outright. And that's the reason we're taking on the risk of selling that item for you.

SPEAKER_02 6:37

Yeah.

SPEAKER_01 6:38

So that's one of the first things I learned is that I needed to adjust down. And I was terrified to do it. I was like, no one's gonna bring their stuff to me anymore because we're not giving them as much in store credit. And so we just did it, and I adjusted all the places where I say it. We didn't like broadcast it out to everyone. We didn't like, hey everyone, we're lowering how much we're paying you less.

unknown 7:02

Yeah.

SPEAKER_01 7:02

But we did, we were we're always transparent about our policies. And so, you know, it's on the website, it's in our messaging now. Um, and there was not one word, not one word about it.

SPEAKER_00 7:17

Which that's a good lesson in and of itself, I think, for everybody listening, because so often we do or do not make business decisions based on what we assume people will think, say, do. And we get in their their pocketbook when we need to stay out of their pocketbook and out of their mind, yes, and not assume, and we need to do what makes sense for our business. And nine times out of ten, that's actually the result, the same result you got. It people don't say anything, they're very happy to still have a place to get rid of their product. Yes, a lot of times customers don't even notice, and so we hold off on making really important financial decisions out of fear of what people will think or say, and a lot of times it's only that story is only created in our head and it's it's not going to actually happen.

SPEAKER_01 8:04

Absolutely. Yeah, yeah, have been that's been proven to me over and over.

SPEAKER_00 8:10

So, one thing that I think is so interesting, that's why I love having our conversations, is because your business model, I mean, every inventory business has its own complexities for sure. But your business, because we have cash and credit, we worked a lot on figuring out the ratios of that cash and credit because margin matters. And, you know, we can get the margin up of any inventory-based business that works in the inventory genius program. There's different ways of doing it though. So for you, your margin was really driven by what you were paying out in cash or credit, and like how you wanted to, I don't want to say persuade, but the options you gave people, like what does that ratio look like? How much credit do you want to get to give out every month? How much cash do you want to get? Those are things I think people don't think about, those like drilling down. So, how has that been for you? Just like drilling into more of the whys behind your policies or financial numbers.

SPEAKER_01 9:07

Yeah, well, and that's the thing. Like until we had our discussions, I hadn't even considered to look at that ratio before. I had looked to see if people who took store credit were actually coming back and using it and how much their transactions were, you know, like are they buying above what their store credit was? Um and but I'd never thought to look at the ratio between to see what is what. Um, I just always was going on gut. And so um, yeah, so we discovered it was really consistent. And so once I started to look at that ratio, you know, I pulled month by month and I was like, oh, there's a pattern here. Um and it was pretty consistently on average, 30% store credit, 70% cash. Um and so, but then also once I knew that ratio, and then tracking how much we spend then in credit and cash um was another way to look at the numbers that um completely opened my eyes to um, you know, how we can be more intentional about controlling that margin. You know, and now my my cost of goods sold are exactly where I want them to be, you know, like I've been trying to meet that goal for so long. And and um now it's exactly where I need it to be, and I know how the levers to move to make sure it stays that way, right?

SPEAKER_00 10:35

Yeah, it's so important. And you know how much cash you're gonna be outlaying, which is different than a typical, typical retail who would say, My open device is I need to buy $10,000. Well, they know they're gonna use cash for that. Yeah, you your open to buy might say you need $10,000 in inventory, but now you know 30% of that's gonna be credit, 70% of that's gonna be cash. It just much more insight. So you know how to plan and what to expect. Yeah. What are some other really important numbers that you started looking at in your business over the last year?

SPEAKER_01 11:09

Well, um, just in general, um, looking at where my expenses go, um, I'd had a hard time really um keeping control of my of my cash on hand. And um because we pay out every single day, um, yeah, we're buying inventory every every day. And so um one thing that you talked about in our training is that idea of, you know, there's this list of people that you need to pay, and you just will, you know, like choose based on, you know, who's the nicest to you or like, you know, ooh, I really need to pay this person. And I was just I was just doing that, just putting money out when it just putting fires out, basically. Yes. And so um, you know, sitting down and really looking at my budget, looking at um the expense of my debt and how all of that fits in um has really helped me now um plan. So now I plan out, okay, I've got these bills to pay and I've got these consigners. There are a few things we can sign, high-end items. Um, and those things would build up. And because it's not like part of my uh everyday business model, it's kind of an exception. Um, I didn't pay as close of attention to those things. And so um that cash flow has been a total game changer for me. I feel so much more um in control when I'm looking at those numbers.

SPEAKER_00 12:49

Yeah, and that's a much better feeling to feel like you're in control versus like every day is just a frantic, I hope I survive. Oh, yay, I survived. I survived for supper. One more day, you know. Yeah. Yeah. Um yeah, so so interesting to think about being more intentional with the spending. I think that um consignment, knowing that you're if it pays out or if it sells those big items, you have to have the cash to pay that person. That would really relate to any of you listening that do drop shipping. People fall into that same issue where they pre-sell, they collect the money, but then they don't save it, and then the bill is due and they can't pay it. So it's just being very intentional with every dollar. Like, what is the purpose of this dollar? What does this dollar need to do for me? And then, you know, allocating like that.

SPEAKER_01 13:39

Right. And you know, that kind of brings up another thing in that with this type of business model. So we're buying the inventory, we're not choosing it, right? It comes to us. So, I mean, we do choose it at that point, but um, what is coming in our door is uh gonna be a complete surprise that day, right? So we've learned to really ask for what we want, and that's something that I've been able to dig into a little bit more deeply with you too, is um finding the highest margin items, the items that sell the quickest, have the quickest turnover rate, so that we can focus our efforts on that. And when I started to set up my open to buy and we looked at the percentages of categories, um I knew that women drove drove the purchasing in our store, but I did not realize that the volume of women's clothes is that's it's over 50% of what we sell. And that was shocking to me. I did not realize that. And so that has really helped us to decide. And when I see things that we have a really low um percentage of what we sell, it's also making me stop and think, like, okay, do we have enough inventory in that area? Like, would we sell more if we have more inventory? So it's been really helpful in how we analyze what we buy. Um we can be really selective as we're hand curating all of those things that come through our door. You know, we can more quickly say, nope, those things just don't sell for us. So we're just yeah, yeah, but these things do.

SPEAKER_00 15:17

Yeah, that's really good too, because I would imagine a year or so ago it was, well, they brought inventory, we need stuff, and it's in good shape, it's a good brand, so we'll take it, versus now saying, Well, if if the women's is selling at 50%, could we sell it and turn it even faster if we had 70% or 60%? And so it's just giving you more decision-making power on that front, also. Right. Yes, yeah.

SPEAKER_01 15:43

It's a tricky, um, that's a one of the trickiest parts of the business because when you are buying from an individual um their own personal items, yes, you know, they have a personal attachment to them. So if you are turning away those items, it's a personal affront sometimes. Yes, I didn't think about that. Differently, yes, um, depending on who they are. So we are very, very careful in the way that we communicate with our customers. And it's never personal, right? It's never for it's a come, it's a purely business decision, right? So that we can be a uh we can sustain our business and still be here to support our community. We don't have to be choosy. So you just have to be really kind and gentle about the way that you approach this inventory.

SPEAKER_00 16:34

Well, one of the last projects we're working on now, you told me where you are sales-wise and where you want to be, which feels like a big gap when you say it out loud. But we did a quick exercise to see that raising your average ticket in a year could get you that substantial growth that you're looking for. And that's just one focus. Um, so how are you going to tackle that? After we that was last week's conversation together that you and I had. What have you thought about that? Because it is harder because you have lower price point items because you're a resale store. Um, and just like you can't necessarily curate your customers, also don't know what they're going to find when they come. So we've got that. What have been your thoughts on how you're going to work on increasing that average ticket?

SPEAKER_01 17:20

Yes. So I think I it's going to have to involve more training on my part and training of my employees. So that's what I've been sitting down since our conversation is just thinking about how I approach it with my team. Um, I feel really great right now about the people I have working for me. I have a lot of part-timers though. Um I only work on the weekend or only work a couple days a week. Um, and so I have to be really intentional about how I bring everybody into the same conversation um and really have them buy into it when you're only working, you know, yes, five hours a week at a store. You know, you don't always have that connection that the the people who are working full-time with me have. And so I'm always um the way I try to communicate with all my team is by that I record videos for them and then share them on our um scheduling app. And that's been a really great way for me to just make sure everyone's getting the same information and to really build up my team, you know. I I've got a really great dynamic with the people I have right now. And so I make sure to tell them, you know, that work you did, even though you only worked two hours this week, that helped us make this sales goal this month, right? So I'm so grateful for the work that everyone does. And, you know, even if you're only here for two hours, the work you do is important and matters. And I want to hear from you. Like I want to have feedback from you about things that you need to make sure that you're doing your job well. So um I think that's what it's gonna take is training um and letting those people know how important the time that they do spend at the store is towards meeting those goals. And so I want to be transparent in my numbers and share that out with everybody. Um and I think it might mean too that I'm gonna have to spend a little more time on the sales floor myself for a while.

SPEAKER_00 19:27

Yeah, for a little while.

SPEAKER_01 19:29

Yeah, yeah, yeah. And um, I've been trying to work myself slowly out of the day to day, and um, but I think it's just gonna, you know, to get there, it's gonna take that. And every time I tell my husband too, all the time that every time I set a goal for our team, they meet it, right? Every time we've tried to, we don't like every month, we don't always meet our sales goal, but we have always been ahead of the year prior. And um, it's those big goals that we set for long term. Every time we've set one of those goals, we've made it. And so just set the goal.

SPEAKER_00 20:07

Just yeah, I think you're gonna do it. I think you're gonna do it. There's a couple things that you said in there that I want to bring to people's, I want to pull them out and bring to people's attention. First, you're gonna your your main focus in doing it was your team. And I think that's really important because we can do all the budgeting, the planning, the cleaning up of finances, the knowledge of, you know, gathering of knowledge. But if we can't articulate and have our team carry that through for us, it's gonna keep dropping and falling short. And so that's really important because you're doing the work on the back end to make sure that the business is profitable and growing and consistent in its growth. But then you have to have people that understand how to take that and run with it. And I think that's really important. We forget that. So we do all this great stuff, and then if anything, it's like, okay, guys, our goal for the month is $50,000 and we leave it at there, you know, instead of like you said, I'm gonna train them, break it down for them, really encourage when they win, you know, how much you appreciate that. So I that's one thing. And then you going back into the sales floor. I really think that that's important. Um, it's not forever, but there's so many these weird myths out there or beliefs or you know, phrases, whatever into all this works. So we hear, like, you know, wearing all the hats, or then we hear, I need to work on my business, not in my business.

SPEAKER_02 21:28

Yes.

SPEAKER_00 21:29

And we get into these kitschy things instead of thinking, what does the business actually need right now?

SPEAKER_02 21:34

Yeah.

SPEAKER_00 21:34

And um, another gal in the group, Melanie, I did a podcast with her about this exact just this exact thing because she has three stores. She'd been out of the day to day, but she was seeing that the sales just weren't where she wanted. So she decided, you know what, for a week, I'm just gonna go in, boots on the ground, I'm gonna work. And she was instantly able to solve the she's like, This is what's happening. She solved it and then could tell her team, and now it's you know, it's fixed. I think that's What's going to happen with you? Cause we are, as entrepreneurs, the best problem solvers.

SPEAKER_02 22:04

Right.

SPEAKER_00 22:05

And so sometimes it takes us going back in with intention, not just putting yourself on the schedule to work, but like this is the intention. How do I how does our business run an average ticket like this? Like, what's the puzzle pieces?

SPEAKER_02 22:17

Yeah.

SPEAKER_00 22:17

So that then you can train your people. So I think that's that's important. And it's intentional.

SPEAKER_01 22:22

Yes.

SPEAKER_00 22:23

Yes.

SPEAKER_01 22:24

Absolutely. Yeah.

SPEAKER_00 22:26

Okay. Anything else that you're excited about learning over the last year that you want to share or encourage other people with?

SPEAKER_01 22:33

Oh gosh. I guess I don't know. There's been so much I've learned. I just feel like, yeah, just the um the importance of knowing, knowing your numbers so that you can um shift them. And um when I very first started the program, uh, I remember the first thing I heard when I was listening to the training was um, you know, it's a math problem and we can figure out a math problem, right? And that really stuck with me. I was like, okay, yeah, I can, you know, you just need to know what's the end goal and how do I get there? Just make that map and just start. Sometimes it's just so overwhelming. I find myself saying that to myself all the time, like it's too much. I just can't, you know, I need to put this off. And then I sit down to do it. It's always, you know, that's just human nature, I think. You sit down to do it, and it's like, oh, okay, I I can do this. I'm just gonna take it step by step. So um, but I mean, just as far as um learning my numbers too, and actually setting a budget, that was um that forecasting. I'd used a forecasting tool in the past, but um, I didn't know enough about all of the individual sets of numbers to really use the forecasting tool effectively. So this has been great to um to work on each of the small pieces and then apply it back to that long-term budget. Um being able to, yeah, do like we did last week um of adjusting, saying, So what if you made this much per ticket and it just shows you that impact, and that's so motivating, right?

SPEAKER_00 24:15

It is motivating, yeah. When you start to when you start to um compartmentalize those numbers in a way that you can like pull them out and do some what if scenarios just on certain pieces makes it so much more doable too than saying, I want to get from here to here. Well, what how on earth? You know, but then when you can say, well, like if I adjust this part of my business, that can like that domino effect. I can do that. I can do that one thing. And yeah, really good. Um, there was one more question I was gonna ask you. Oh, yes. So of all the tools in the inventory genius program, what are you planning to take and continue to use going forward, like year after year? Are there certain things, tools that you've loved that you're excited about just keeping up with?

SPEAKER_01 24:59

Well, I don't, I love, I've just created a whole process around all of those. I love clicking in between each of them, plugging all of those numbers in. But I do love that um, well, I've been using that, that cash flow is so helpful for me to plan out my bills as the months go and um to really look at how much cash is coming in. But I love that um monthly and weekly snapshot um of just, you know, it tells you your margin right away. It tells you, and then it's showing you this is the money that you have to build parts of your business, right? If I'm putting money away for taxes and it just feels good to know that you're planning and preparing yourself for those business expenses that come up that in the past have been like dreadful, you know, you just agonize over this bill's coming due and I don't know how I'm gonna pay it. You know, so to be able to plan, I love those um snapshots and seeing how those little bits add up.

SPEAKER_00 26:03

Add up. Yeah. Well, I know it's July when we're recording this, and you're already planning for the first time to have a stress-free January, February. Yes, which I'm excited about. Yeah, we have a couple things that we're gonna work on numbers-wise between now and the end of the year to set up and prepare for a January and February that doesn't undo everything we did the previous year. Because I think that's a big thing in inventory-based businesses. We work so hard the second half of the year, and then everything feels undone January, February, and we start all over again. So this year we want you to be starting from ground zero instead of like from way behind the eight ball again. So I'm excited, you'll have to report back and let me know, you know, next March, like how did it go? How did it feel? And then I think whatever you learn through that, you'll take and you'll just keep applying that every year, and it'll be great. You're such a great, um, you have such a great brain for wanting to dig in and just do the work that you know you need to do. And so I appreciate that.

SPEAKER_01 27:01

Oh, thank you. Thank you. Well, it's been great to learn it from you. You're a great teacher, too. So I love it.

SPEAKER_00 27:08

It helps when you love what you're teaching, right? Right. Yes, yeah, awesome. All right, Lisa, any last word of encouragement for someone who's feeling like you felt a year ago, like really overwhelmed, like they've tried a couple different programs or things, stuff hasn't worked, feel stuck, anything you'd like to leave with them?

SPEAKER_01 27:27

Well, just to keep um asking the questions and rely on other business owners that it I learn over and over again that no matter what industry you're in, we all have the same pain points. Yeah. And um other, you know, take advice from other people and keep seeking out those um answers to the questions you're looking for. Someone out there has the answers you're looking for, and you you can do it.

SPEAKER_00 27:55

It's I love that. Yeah, stay curious and you'll figure it out. Yeah, I love it. Awesome. Well, thanks so much. I'll let you get back to your store and your business, and I'll see you again next week as we finish up your time in inventory genius. Sounds great. Thank you so much, Sierra. Thank you. Thank you guys for tuning in today and listening. If this was encouraging, I would love for you to share it with one other small business owner that could use some of the tips we talked through today. I'll see you guys all next week. Bye for now. Hey there, friend. It's time for you to start winning at business again. I want you creating more profit and keeping more cash every single week in your business. Head on over to SierraStockland.com, click on the programs tab, and you're gonna see multiple ways that we can work together. Whether you're doing $50,000 a year or $50 million a year in top line revenue, there is a place for you. The Inventory Genius Framework has helped hundreds and thousands of product-based business owners just like you, create more profit and keep more cash in their business. I want you to win. I want you to start taking a consistent paycheck, paying off that debt, and just feeling confident and comfortable when it comes to your numbers. You can do this. I believe in you and I'm here to help. Head on over to CRStockland.com or click on the link in the bio, figure out where you might best fit. We are here to help you. Let's create more profit and keep more cash starting today.