The holidays – generally considered the time between Thanksgiving and New Year’s Day – are the busiest time of the year for many small businesses, and particularly those focused on retail sales. McKinsey and Company are reportedly projecting that the holiday season will start earlier than usual this year and feature a consumer base clamoring for value in a year of heightened inflation. What can small businesses do to prepare for that boost in sales and traffic? Here are ten tips.
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The first step in any holiday preparation is to look back at your business’s holiday preparation and performance from years past. The best way to ensure you’re prepared for this year’s holiday season is to understand the patterns, rhythms, and lessons from the recent past.
Have a look at your sales data. When did your sales pick up? When was the peak, and when did things start to taper off? Were there particular items or categories of items that picked up strongly? How was staffing? Did your staff get overworked?
Base this year’s holiday preparations on the lessons you learn from this research. That way, next year’s preparation will be even more honed and ready to face the challenges of a busy end-of-year season.
Plan Your Holiday Sales
Whether your customers are making in-store purchases or only visiting your online store, the holidays are a perfect time to launch a sale. Because the holidays tend to be the busiest time for many companies, the reduced margins that come with markdowns can result in a massive increase in total sale volume, leading to a revenue boost.
Businesses use several nationally-recognized dates throughout the holiday season to encourage holiday shopping.
Small Business Saturday. Small Business Saturday was founded by American Express over a decade ago and was intended to boost sales for the smaller companies that do business throughout the country. According to American Express’s research, the November 2021 Small Business Saturday saw consumers spend over $23 billion. This year, Small Business Saturday will be held on November 26 – the Saturday after Thanksgiving.
Black Friday. Black Friday refers to the longstanding tradition of offering significant discounts the day after Thanksgiving. In 2022, that’ll be Friday, November 25.
Cyber Monday. If your company offers online shopping, you may want to consider offering discounts for Cyber Monday, as many consumers opt to sit out the throngs of people hitting stores on the two days following Thanksgiving. Cyber Monday is held the Monday after Thanksgiving and is traditionally focused on e-commerce discounts and promotions.
On top of the more traditional sale days, you might determine that your company’s products and services are suited for additional sale dates. If your target audience is made up of people doing their Christmas shopping, you might want to consider another sale the weekend before December 25 to meet their needs, just for one example.
Once you know the dates of your promotions, you need to know what promotions your company will offer. Is it best to bundle products? You could also offer a discount on your most popular products. You might consider launching a new product or service at a steep discount in order to drum up support.
Advertise for the Holidays
Having a holiday marketing strategy is a great way to drive business, and there are several channels and forms that your advertising can utilize.
Social media posts can keep new and existing customers informed of the dates and scope of any sales you’ve got planned for the holiday season. You can also use social media to interact directly with your customers, reveal new products, highlight your excellent customer service, or share a video showing happy customers using your tried-and-true products.
Email marketing can be a great way to let your loyal customers know about holiday promotions. A properly established email marketing software can help you get the word to the right people. That way, you can let them know, for example, when they need to place an order if they want to receive the order by a certain holiday. You’re reaching out to the people who love your products most and making sure that they’re getting highly-relevant information.
Content marketing is the act of using content – like a blog or video – to advertise for your company. The holidays are a perfect time to boost your content marketing efforts. Imagine, for example, you run a shop that specializes in selling high-end spices. You could post blogs with recipes featuring your spices. You could write a list of the best gifts for home cookers (featuring, of course, your spices). You could even write an explanatory blog about why certain spices taste like the holidays. The point is, content marketing gets genuinely helpful information into the hands of potential customers and shows them how your products will help them take action on that information.
Acquire Inventory
If you’re going to boost sales at the busy time of year, you’re going to need items to sell. That’s why one of the most important things you can do to prepare for the holiday season is to make sure you’ve got enough stuff to sell.
You went back and looked at your holiday sales from last year. If you’re a startup, you’ve done realistic and evidence-based projections for what you can expect for this year’s holiday season. Now it’s time to reach out to vendors and suppliers to let them know what you need.
It’s 2022. There are likely to be supply chain issues, unexpected expenses, and rising costs for your suppliers too. That’s why it’s important to have an idea of the inventory you need before it’s too late to get it into your hands-on time.
Of course, stocking up on that much inventory might require extra funding. Many businesses already struggle with day-to-day cash flow issues, and the idea of spending a significant amount of extra money on inventory can feel untenable. It may be wise to seek out a holiday loan to boost your ability to stock up.
Hire the Necessary Team Members
You can’t do everything by yourself. A boost in sales during the holiday shopping season means there’s ever more work to be done, more products to ship, more customers to interact with, and a greater chance for something to go wrong. That means it behooves you to hire staff.
Whether it’s a temporary worker, a part-timer, seasonal full-timers, or a permanent addition to the team, adding bodies to the staff of a busy small business makes everyone’s life easier. Business owners are able to focus on strategic-level work instead of the minutiae of sending packages or ringing up customers. And those customers, particularly in a brick-and-mortar store, are getting excellent customer service from a team able to keep their eyes on customers throughout the space.
Having a big enough team also means you don’t have to overwork the team you’ve already got. Adding part-timers means your long-time staff is able to take time off during the holidays to see family, do their own holiday shopping, and keep themselves rested so that when they do come into work, they’re bright-eyed, bushy-tailed, and ready to get stuff done.
But it isn’t just sales associates you can hire for the holidays. Maybe you bring in a temporary IT specialist as your online sales see a big boost. Maybe you hire a marketing specialist to oversee the implementation of your holiday marketing plan. Some small businesses might want to consider a web developer or designer to optimize their websites and boost sales that way.
Spruce Up Your Brick-and-Mortar Stores (Even Literally)
It might seem minor, but it’s a huge part of catering to the holiday shoppers to whom you’re looking to appeal: make your spaces feel like the holidays. If you run a brick-and-mortar retail store, how can you make your shop feel like an upcoming holiday? You could hire window painters or hang lights. You could incorporate pine boughs and garlands near your displays. If you sell family-oriented gifts, you might even want to consider arranging a visit from a jolly old man in red (an effective and evocative addition to a holiday marketing campaign).
The decoration isn’t just for the physical spaces either. Whether it’s updating copy on your website to reflect the holiday season or changing the item photos on your sales pages to show them as gifts, you can make small changes to your website to make it feel like the holidays on the internet.
New customers will see the work you’ve put into making your company’s forward-facing spaces feel like the holidays.
Plan for January
Of course, a busy time is followed by a slowdown. What’s your company’s plan when the busy season ends and it’s time to go back to a slower pace of business? Will you keep your new hires around full-time?
Having a plan for the holiday rush is important. But you also need to make sure you’ve got a plan once the customers have cleared out and you’re looking at the new year. If you took out loans, are you prepared to repay them in full? What’s the plan with your new team? Can you restock properly and ensure consistent sales? Make sure you’ve got a well-planned off-ramp as well as a plan for when the going gets tough.
Seek Out Funding for the Holiday Season
Hiring, advertising, inventory, web development, decoration… they all cost money. An Intuit survey of more than 3,500 small businesses found that nearly 70% of American small business owners describe themselves as “stressed” about their cash flow, and 57% report that cash flow has been an issue at some point.
That’s why short-term funding might be a helpful solution for these holiday expenses.
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SBA Express Loans. A government-backed loan of up to $500,000. This program includes a smaller SBA guarantee for lenders, but much faster movement than regular SBA loans. If you’ve got good credit, this could be a smart option.
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Short-term loans. A traditional bank loan with a repayment period of under 18 months. Short-term loans tend to be smaller than long-term loans and come with a higher interest rate to compensate.
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Business lines of credit. A business line of credit is a form of loan in which the lender gives a borrower an agreed-upon credit limit. The borrower can borrow up to that limit and pay interest only on what’s borrowed. Many businesses take out a line of credit and don’t draw on it unless there’s an emergency – or an opportunity. A line of credit can help pay for a holiday expense quickly and minimize interest if you’re only using a small portion of the credit limit.
Make a Plan
While this is the last point on the list, it should be the first part of any holiday preparation you do. Look over everything above and build your company a plan of attack. When do you need extra staff, and when do they need to be fully trained? How much inventory can you expect to go through on your sale dates?
Work backward. You should know how much inventory you can expect to sell during the holidays. If you know how much inventory you need, you can work with your suppliers to ensure you’ve placed orders of the right size at the right time. And if you know when you need to place orders, you know when it’s time to acquire the funding needed for those orders.
Build a calendar or checklist for the holiday season. That way you can turn this often-stressful period for business owners into an engine of expansion and growth for your well-prepared company.
