Estimating hourly sales for business plan

[Phortoes]

I want to start a business selling mainly cookies but some cakes and drinks. I plan to get a concession in a shopping centre. I am putting my business together and struggling with estimating hourly sales. I've been to a mall and sat by Millies for an hour each on a weekday and a weekend. I don't know what people bought though. Also, I won't be in same mall anyway. I don't know which mall yet as all my local malls seem to have businesses doing same thing.

I'll appreciate help with this please. And if anyone has experience of running similar business (baking onsite) would you mind sharing your experience/knowledge. Thanks.

 

[Philip Hoyle]

OK, you've made a good start. Nothing better than to sit and watch.

But, it's not just a matter of counting customers going in. You should also have tallied the number of people walking past. That way you get a figure for percentage of people passing who went it.

If, say, it was 10%, then you can get footfall figures for other locations, i.e. number of people walking past your desired location, and apply the same percentage to get a best guess at the number of people who would come in.

You also have to do the tallying at different times of day. You need to know this, not just to estimate sales during each hour, but also to get an idea of your staffing needs as you need to employ just enough people during each part of the day. Your sales between 9-10 will be very different to between 11-12 and 2-3 for example - pointless to have the same number of staff behind the counter at quiet times compared to busy times.

As for knowing what people buy, again you have to sit and watch and tally. If there's seating near the counter, sit with a good view and watch what people buy. If not, then you have to go in a few times when there's a queue and watch from the back of the queue what people are buying - the more people in front of you, the more data you gather. Do it at a few random times of day and you build up a picture of average purchases/spends and also whether people buy different things at different times of day.

 

[Billmccallum]

Philip's advice is spot on.....

the shopping centre management will have details of overall footfall, but an hour a day doing research is not enough, you need to know (even if its only ballpark figures) how many people buy throughout the day, not just at peak times.

finding a student (particularly one doing marketing) to spend some time doing the counting can be cost effective..

 

[Phortoes]

Thanks both. I'll do as advised and try to be as inconspicuous as possible when I'm not in the queue.