I have to say that the advice mobyme gave is extremely bad advice.
Following that advice every independent shop should close down, all convienence stores, bookshops, bakeries, butchers etc, and we should all then be grateful to get jobs pushing trolleys in the Tescos car park.
Yes it is true that you cannot compete on price, and if you are trying to compete on price that is the reason why you are in trouble.
Compete on everything else apart from price, there are plenty of convienence stores, bookshops, bakeries and butchers offering great shopping experiences with expert knowledge that the likes of Tescos have not got a hope in hell of competing with.
I have to say I agree very much with that statement. Trying to be all things to all people and competing on price with the big players in the market and you'll do nothing but die trying.
Only the OP can ultimately decide whether it's best to call it a day and close down. Right at this moment in time they probably can't see the wood for the trees, but it's an option that may need to be considered. I feel for you I really do and speak from being in a similar situation nearly two years ago to the week.
For what it's worth I have a few practical real world ideas that may be useful. It's all very well coming up with ideas for stock ranges, events, promotions, etc. but these are IMHO longer term things that need to be looked at, without customers and most importantly cash flow happening quickly they're a waste of time.
Go through you shop, stockroom, warehouse with a clipboard and note down every product that's not sold a single unit for 6 months or more, be totally and utterly ruthless, and more importantly honest with yourself when doing this. Look at what ranges really aren't doing well. This is where your money is tied up and you'll get a shock at just how much money is tied up in this stock. This stock needs to be sold now and at cost or a little below if needed, nice stock that you like that does not sell is not nice stock, it's your enemy.
The next thing to do is concerntrate on selling this stock as quickly as possible, be bold, be very bold, huge signs, local paper advert, flyers, and the best of all good old eBay. It doesn't matter your shop might look like a clearance warehouse, though it might feel a little soul destroying this is only a short phase that you can put behind you in a few weeks. Cash flow is king right now. If done well with dedication not only will you see the back of stock that is dragging you down, you'll also sell other better good profitable stock at the same time as footfall increases. In a few weeks you should be in a far better position to decide what course of action to take. Hopefully you will to a great extent start with a clean slate and build your business up again, but this time based on sound experieince gained over the last few years and with an insight of what will work in your market. You need to specialise, be the best around for a particular product or group of products. That however I can't help you with, it's outside my product knowledge area. One thing I can tell you is that being a small trader, having a web site and eBay presense as well as a shop is something I would class as essential nowadays.
