Last month’s sales were low, and you simply assumed it as a fluke. However, it’s a month later and things haven’t changed. In fact, they’re getting worse.What you thought was a minor setback is starting to look like a trend – and a bad one.


So what do you do? Why are your retail sales declining and what can you do to turn things around?

Although every situation is different, here are five reasons why your sales may be declining – and what you can do to turn things around.


1. Marketing dropped the ball

One possible solution is that your team hasn’t invested as much time or money in marketing as you have in the past. Perhaps your marketing team decided to try a new marketing strategy and transitioned funds from an effective marketing channel to an ineffective one.

Although marketing isn’t always to blame, if there has been a big change and the results have been lackluster, it’s certainly worth evaluating if anything has changed in your marketing endeavors.

Solution: First, go back to the strategy that worked. If your marketing team decided to shift finances from one activity to another, tell them to resort back. Then, once you are back to your baseline, encourage marketing to try new activities without reducing their investment in the marketing strategies that have been proven to work.


2. Your team provides poor customer service

Have there been new hires or staff turnover recently? If yes, evaluate how this is affecting your customer base. If a new sales agent ignores customers, acts uninterested, or fails to provide value in some other way, your customers will likely leave and take their business elsewhere.

Solution: Hiring the right people can make a world of difference. If a new employee has a negative attitude or repels customers in some other way, invest time in training and educating this new hire on how to behave. If that doesn’t work, it may be time to part ways.

3. You’ve devalued your product

A good sale can bring in a lot of new customers. However, a sale can also reduce the perceived value of your product. Once you start offering products at a discount, you better plan on doing this indefinitely – because customers will only visit when the product is on sale.

If last month had blockbuster sales during a promotional period, and this month is doing far worse – it’s likely because consumers are waiting for your next discount to return.

Solution: If you plan on offering your products at a discounting rate, then plan to do it on a regular basis. If you want to increase sales without providing a discount – than offer additional value instead. During the recession the Four Seasons Hotel chain refused to discount their room rates. Instead, they offered deals where you would get the 5th night free. Essentially, this gave customers a 20% discount. However, it maintained the integrity of Four Seasons’ pricing.


4. Your store’s atmosphere isn’t up-to-date

If sales have been declining steadily over a period of time it may be the result of an out-of-date store atmosphere. Trends and styles are constantly changing. If your store was hot a year ago, but hasn’t changed with the times, you may be losing out on sales simply because your brand is no longer relevant.

Solution: Take a look at your customer base and the stores that they visit on a regular basis. What are they interested in – and does your store offer that? If not, update your atmosphere and product offerings to meet the needs of your target audience. Remember, your goal is to provide value to your target market, not force them to do things your way.


5. A new competitor has entered the market

One of the most challenging times for a retail shop is having a competitor open up down the road. If a large super-store or well-known chain as just opened its doors in your neighborhood, that may be the reason why your sales are seeing a dip.

Solution: Battling with a new competitor isn’t easy – but it’s necessary. Evaluate how they are different than your store and why your customers are interested in their brand. Then, determine your strategy for fighting back. Your two options are two either try to put them out of business by offering discounts/etc., or finding way to differentiate yourself through products, pricing, service, or some other unique selling proposition.


Realizing that sales are diminishing is scary for a retail outlet, but it can be remedied. By taking a critical look at the reason behind your decreased sales, you can determine the most effective way to combat it.

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