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10 Ways to Improve Your Profitability and Inventory Turn this Holiday Season

 

Retailers struggle to find that sweet spot—enough inventory, but not too much. The last thing you want to hear during the Christmas rush is that dreaded word: stockout. But you also know only too well that end of season dead inventory clutters your sales space (detracting from the customer’s buying experience), ties up precious working capital and clogs up storage.

Storage… ack! Because retail space is never inexpensive, shrinking your storage footprint is crucial. Plus, hanging on to inventory is always an iffy proposition. Every product has a limited shelf life, and you never know what could happen during the year to cause damage (or loss) to the goods.

You also know that it’s a bad idea to tie up working capital in non-seasonal stock that might not be on trend next season. It’s frustrating to think of all that money sitting in inventory instead of being spent on new stock for sale and profit.

Wouldn’t it be wonderful, too, to have fewer products to count during the annual inventory period?

So how can you move, move, move those products out the door while plumping up your business’s always-paper-thin operating margin?

 Let us count the ways… 

#1     Have your inventory forecasting system in place and use it

Ready… aim… order!

It’s easy to get bogged down in daily events and let long-term planning go. But by having your inventory system in place you will know when to stock up, or let up on ordering—before, and especially during, the busy holiday season.

It’s also a good general rule to use past sales as a guideline in planning seasonal inventory. Knowing the historical trends isn’t sure-fire, but it helps. This is one way you can establish low-stock thresholds for popular products so that they will be reordered quickly if supply dwindles.

And never forget that your goal isn’t to get enough product to fill the shelves, but to fill the demand. Forecasting is a living process.

Tip: When your forecasting system indicates that you have some slow moving or short to expiry items, add value and sell them quickly by bundling them together in an enticing gift basket.

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#2     Be ready to “let the holiday shopping begin”

Some good news (and can’t we all use that?) is that the National Retail Federation predicts that holiday sales in 2017 will grow between 3.6 and 4%. Consumers are projected to spend around a total of $682 billion dollars.

But you should also know that holiday shopping last year started earlier than ever, with 154 million shoppers joining the frenzy during Thanksgiving weekend.

You may or may not be part of the Black Friday--Cyber Monday--Small Business Saturday craziness, but still you should ask yourself: Will we be ready?

You don’t want to let a minute of that holiday-shopping energy go to waste, so be stocked up, spruced up and ready to roll.


Tip: Pay particular attention to the entrances and windows that are visible from the outside of your establishment. Prospective customers may walk or drive by your storefront many times before entering. Are you giving them a view that entices them to come on in?

#3     Prepare to give stellar customer service

Frazzled staff are a retail store’s reality, especially at this time of year, but part of your preparations should include doing everything you can to provide exceptional customer service, never mind the weather or mayhem. 

It might help to hold this thought uppermost in your mind: the holidays bring people into your store who would never venture your way at any other time. This is your opportunity to give them the kind of customer service that will draw them back again and again. 

During this season you and your staff should be particularly on the lookout for the befuddled buyer—grandparents in search of something (anything!) for their teenage grandchild, a husband looking for a unique and less-likely-to-be-returned present for his spouse or a boss trying to find something intriguing for his staff. 

A friendly face asking “Who are you buying for and can I help?” may not only result in a sale, but more importantly, create a return customer. Helping a shopper find what they are looking for—even when they aren’t sure themselves—creates customer loyalty. 

This is also the ideal time of year for showing a faithful customer that you do pay attention, and you have just the thing for their Hanukkah open house, or for their five year old, or for their aching back.

Tip: Stress to your staff that they have to keep the kvetching inside the break room or after hours. It puts a damper on your customers’ spirits (and your sales) when the employees are heard complaining. "Never let your customers see you sweat" is the motto of this (and any, really) season.

Praise and reward employees who never let their tinsel get in a tangle, no matter how chaotic things get!


#4     Upsell your inventory with creative packaging

Creative packaging allows you to bundle products in enticing ways. It also avoids that scenario you know only too well where shoppers see an item, ask you questions about it, then check their smartphone and see that the price is cheaper elsewhere/online and so they leave your store empty handed.

Consider this: you can’t compare prices on a beautifully arranged and unique gift basket. 

In addition, if you package your products with a special occasion in mind, there’s a chance you’ll see a frazzled shopper’s eyes light up. They might have only about 3 minutes until the party starts, and they still need to dress, and you have provided the perfect gift, in a festive package, just right for the occasion.
 
Cue a huge sigh of relief.

A classy black and white market tray loaded with spa products for the customer’s elegant (but perpetually stressed) friend? Perfect!

A lined picnic basket with artisanal treats for their kid’s nature-loving teacher? Ideal!

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Get creative, think about how to combine products and be proactive in purchasing packaging supplies. Your bottom line will thank you for it!
 

#5     Maintain good relationships with your suppliers

There’s an old adage: take good care of the people who take care of you.

Ideally, you want a partnership with your suppliers/vendors that allows you to establish trading terms that help your cash flow and business growth. The effort you make to develop good rapport with your suppliers all year long will pay off particularly well during the holidays if you need a rush order, have a question or some other problem arises.

And you can be a good partner to your supplier by helping them flush excess stock--at a price that will wow your customers, of course!

 

#6     Create a good shopping experience for your customers

Because face it—they could be shopping online.

But Christmas is a time when shoppers want to be out and about with other people. They are often feeling excited and/or nostalgic. Just thinking about the sights, sounds and smells of the holiday can motivate them to turn away from their screens and walk through your doors.

Be aware of all of the senses as you prepare for the season, and keep your brand in mind as you plan.

 Sight: 

‘Tis the season for lights and bling-ey things. Or nostalgic candy canes, depending on your brand and products. Be sure you pack a visual punch with your holiday décor and products. This is no time to be staid.

Tip: Put together gift baskets that will do double duty as décor and product.

Envision a row of festive silver sleighs, each filled with items for sale (such as jewelry/delectables/ornaments/fill-in-the-name-of-your-product-here), all tucked into light-catching cello shred. 

A holiday sight to behold!

Smell: 
The nose knows when it’s happy and for all of us humans, our sense of smell is a shortcut route to our emotions. If your products lean toward the nostalgic, cinnamon and nutmeg will liven up the shoppers’ memory banks and you’ll hear lots of “Oh, I remember these! I’ve got to get one!”

If your brand is all about freshness, bring in some fresh spruce boughs (replace when they get dry) or stack lemons in strategic spots for a pop of scent and color.

Sound: 

We all cringe at that endlessly-looping version of White Christmas. Do your customers (and staff!) a favor and give a lot of thought to your holiday playlist. What mood do you want to create? Chances are you’ve addressed this for the rest of the year to make sure your audio identity is consistent with your brand. Don’t abandon that approach just because it’s Christmas.

And another thing: make sure the volume is appropriate for your consumers, more than the staff. Your weary employees may want a musical boost, but if the sound is too raucous, customers may not even step inside your retail space. Music should augment, not overpower.

With some thought and effort, you can deliver an experience that not only entices your customers to cross items off their shopping list, but also sends them off in good spirits.


Almac Imports has same day shipping on over 5,000 items

 

 

#7     Quick as old Saint Nick

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Yes, some customers will want to wander and browse. But you should also be prepared for hit-and-run shoppers. 

What’s happening a lot during the holidays?

Parties, of course. Open houses. Concerts. Staff gift exchanges. Tons of occasions where a gift is required or would simply be a great idea. Make sure your store has just the thing, and have grab-and-go items available, because your customers are going to need them.

And as the days of December wane, give some thought to last-minute shoppers. Put your most seasoned staff where they can take those befuddled buyers by the hand and help them out of their too-late, too-little-time dilemma.

This is the moment, too, when shoppers are often finishing up their holiday shopping by buying stocking stuffers. Be sure to have some small, lower-priced items to offer them as options.

 

#8     Put yourself in the holiday shopper’s shoes

It’s a frantic time of year. A whole lot is happening in a short time frame. Be sure you provide a smooth shopping experience for your customers, and don’t trip them up.

Try this: stand inside your store and just look around. Rather than being an unproductive use of time, this little method will give you an idea of how customers see your store and products, and help you anticipate problems.

Examine the store layout and pretend you are a customer. Are you placing products so they are easy to see and reach? Especially during busy times, shoppers may hesitate to buy if they have to enlist the help of a sales associate just to get a good look at an item.

What about checkout? If a line develops, does your staff know how to handle the situation so that other shoppers aren’t blocked from reaching products?

Some forethought (plus a chat with seasoned sales staff for additional ideas) can help you remove barriers before the season begins.

#9     Be very social-able

Eweek reports that a 2016 survey by Influence Central found that 81% of consumers buy products on a frequent basis that they have seen shared on social media. In addition, 87% report that they’re more apt to purchase brands that they engage with through social media and 77% keep their smartphones handy when they shop so they can check reviews and recommendations on the spot.

Those are some impressive percentages! Obviously, connecting with customers via social media is an important piece of the inventory-moving pie.

An active presence on your social media outlets is important all year round. Don’t let the busyness of this season keep you from posting, sharing, commenting (especially to kudos or complaints) quickly. If you need to recruit some help in this area—do it.

Don’t let your social media voice go silent. You can bet your competitors won’t.


Tip: It might be that you notice a mid-holiday-season slowdown on a specific item. So you decide it’s time to ramp up the buzz about it. Give a discount to customers who post a photo of your product on their social media (and give them a specific hashtag to use).

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#10     Order products that span more than one season

Wouldn’t it be great if any inventory left over from the holidays could be just re-purposed after the garland and ornaments go back into storage? With some pre-planning, this is possible.

For example:

Let’s say you decide to package some of your products in a red fabric container. You nestle them in with some holiday-happy candy cane tissue paper and add a peppermint pull bow.

Come January, you find you still have a few of these delightful packages around. No worries. You simply switch out the candy cane tissue for some razzle-dazzle red metallic shred, keep the peppermint bow and guess what? You’re ready to add product for an eye-catching Valentine’s Day gift.

With some creativity and thought before ordering, many of your products can move gracefully from one season to the next.

 

And one last thing:

Don’t forget to take time to breathe in the season yourself and enjoy the festive spirit. With proper planning and execution, you’ll go a long way in creating not only a profitable holiday season, with a high inventory turn, but a merry one too. 

At Almac Imports, we love to play matchmaker between your needs and the products that will meet them. Since 1963 we have been helping people from a cross-section of industries (retail, food service, floral, specialty shops, supermarkets, just to name a few) to find the baskets, containers and packaging supplies they need to showcase their products.

Contact us or visit our website. You want to be ready for a profitable and jolly holiday season—we can help!