A Practical Guide to Preparing Your Retail Business for the Holiday Season
For retail businesses, the holidays are no joke. The season can represent as much as 30% of annual sales, the National Retail Federation reports, and about 40% of consumers begin their holiday shopping before Halloween even comes around. What’s the rush?
For retail businesses, the holidays are no joke.
The season can represent as much as 30% of annual sales, the National Retail Federation reports, and about 40% of consumers begin their holiday shopping before Halloween even comes around.
What’s the rush?
Many people prefer to shop early to spread out holiday spending. So while you may not start advertising for the holidays until October or November, you may want to start stocking your shelves with merchandise earlier than that. Greeting cards and decorations are especially in demand earlier in the season.
This is great news for businesses who typically rely on the holidays to make or break revenues for the year, but it can be a behemoth task to prepare your operations for the uptick in demand.
First Steps: Scope Your Needs
Map an accurate forecast of holiday sales.
Using historical data, prepare a forecast of sales volume—one which indicates peak days, times of day, quantities and volume of shipments. From there you can more accurately tailor your operations to actual demand.
Assess your capacity early.
Update your inventory numbers so you know what you have on hand and what you’ll need to order. If you’re planning to add more inventory, check that you have sufficient warehouse space to store inventory until it’s needed.
If you have a brick and mortar location, ensure you have provisions to make the shopping experience more pleasant. For example, confirm that you have enough parking during peak times, or registers for expedited purchases.
Mapping out the trajectory before the holiday season arrives means you can address any deficiencies and maximize profit potential.
Give your suppliers a heads up on orders.
Once you have a sense of inventory needs, notify your suppliers of your anticipated demand so they can prepare to fulfill orders swiftly and seamlessly during the holiday surge.
For specialty products and supplies, confirm that you have access to them or the production capability to meet customer requests.
Secondary Steps: Tune Up Your Internal Systems
Align your omnichannel marketing strategies.
If your operations are omnichannel and entail multiple avenues of retail—e.g. eCommerce, brick and mortar, cloud-based applications, product reviews, and app-based ordering—it is important to assess whether your capabilities are properly configured and scaled to accommodate robust demand. Make any necessary adjustments with the volume and pressure of the holiday rush in mind, such as having additional staff on hand to handle complaints left in reviews or customer support for app-based queries.
Align your financial operations.
Test your payment and point-of-sale applications to be certain your business is capable of handling a large volume of transactions – both brick and mortar and online sales.
As you do this, be sure to factor in Black Friday as well as any promotions, sales, incentives and new product launches you have planned for the holiday season. Those particular events may create higher volume than usual and you’ll want to be prepared for any potential bottlenecks.
A Holiday Rush Planning Checklist
While preparing for holiday orders is an admittedly layered process, you can break the effort down into smaller, manageable tasks to help get the job done.
Completing the following checklist can help make sure you stay on track:
- List all concerns related to inventory, accounting, and order fulfillment related to a seasonal holiday sales surge.
- Confer with suppliers to encourage them to also prepare and review their holiday surge preparations.
- Assess your workforce requirements and determine if you have sufficient workers to accommodate calls, orders and returns.
- Consider workforce training and planning, so customers are best served with quality service and attention.
- Estimate your working capital and credit requirements for when orders increase to ensure there’s enough capital to capture the sales potential.
- Test your cloud and web-based operations, if possible, to ensure they are properly scaled for high volume.
- Review historical data and past complications to develop safeguards and countermeasures for operational problems.
- Review your payment card capabilities, capacity and scalability to handle an inordinate volume of orders.
As you gear up for the season, reach out to your financial advisor to discuss your evolving holiday strategy. These seasoned professionals can offer you an invaluable fresh perspective while getting you up to date on the latest resources available to you.
The views expressed by the authors are not necessarily those of Fifth Third Bank, National Association and are solely the opinions of the authors. This article is for informational purposes only. It does not constitute the rendering of legal, accounting, or other professional services by Fifth Third Bank, National Association or any of their subsidiaries or affiliates, and are provided without any warranty whatsoever. Deposit and credit products provided by Fifth Third Bank, National Association. Member FDIC.