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PREPARING FOR THE HOLIDAYS

Since the first Small Business Saturday in 2010, TRMA has encouraged independent retailers to participate in the American Express sponsored event Small Business Saturday, not to support American Express, but to support buying from independent businesses—like you. There is also now a “Buy Local Campaign” promoted by AMIBA (American Independent Business Alliance). They have good information on their web site at www.amiba.net; just click on the link for “Buy Local Campaigns.” If you haven’t participated in the past, plan to this year. If you participate, plan to do more for your store each year.

The following is a list of some of the oversights most frequently committed by retail businesses.  Hopefully, this will help you create a plan for success and to obtain more loyal customers for the future.

NO MARKETING PLAN
Benjamin Franklin said that “failing to plan is planning to fail.” Planning won’t save you from every emergency, but it will help with many. Have a plan to cover the hiring and training of temporary staff, social media posts and promotions, whether or not to extend store hours and who works when (NOTE: You can not do it all and do it well so hire some help if needed).

First, consider your store. Will you offer extended hours during the season? Will additional staff be needed to cover the additional customers plus the additional hours of operation? Assign tasks. Talk to existing employees. See how much extra time they would be willing to work during the busy holiday season. You might be able to cover most of the needed hours by using your current employees. Even if you have to pay a little overtime, you will be better off since no training will be required and they already know your store and your customers.

As far as possible, spend time now to plan ads for the holidays, including emails, direct mailings, social media promotions and in store events. Write as much as possible now and keep it in a file on the computer or if preferred, in a notebook on a shelf near your desk.

Have a plan for some new merchandise, maybe from a vendor you haven’t tried before. Customers are looking for unique items. Your plan must include a way to replace sold items but also to move the “flops.” Use the Open-To-Buy to help with merchandise planning so you do not get carried away at market and buy too much.

HUGE MARKDOWNS TOO EARLY IN THE SEASON
An independent retailer cannot compete with chain stores, big box retailers or discounters in price alone; therefore, they must be creative in how they present their merchandise. Put outfits together for your customer so they can see the shoes, purse and accessories that compliment the dress and then change it up frequently. Be sure to include those items that seem to be moving more slowly than planned. When customers see a complete outfit, they may be more willing to purchase the whole outfit. Bundled merchandise, i.e. business suit, shirt and tie or scarf for $XXX or socks and laces with shoes or the dress and accessories make exciting package deals for customers without giving away the merchandise with a huge markdown. For sure, you probably need to have some reduced items, but not everything in the store. That cuts deeply into profit and can place continued operation of the store in jeopardy

Opposite of bundles is an “item of the day”. One single item will be reduced for one day, but feature similar items or complimentary items near the item of the day. If the items sells out, or it is not quite what they want, there are other choices at hand. A local craft store does a 12 days of Christmas each year moving some of those “it’ll-sell-like-hotcakes” items that did not meet sales’ expectations.

Another retailer has found success in Facebook flash sales. This store offers items that have not sold as planned previously as “Only XX (12) Left” with sale beginning at 11 am today. You must come in to the store today for this terrific deal!

And do not forget your loyal customers who have shopped your store all year. Some stores have offered these customers free shipping, gift wrap, or a free item (store’s choice) given as a gift.

All the above are ideas to avoid a blanket 20% or more markdown. Save that for when it must be used to move those mistakes out the door.

STAFF ISSUES
One outcome from 2014 of having the stores open on Thanksgiving or the exceptionally long hours is that apparently it gained those retailers little if anything. We learned last year that the extended hours did result in more expense for the stores but not more sales. Retailers are in business to sell merchandise; not to provide a climate controlled stroll for the public. Apparently, customers have a preconceived dollar amount to spend and that is what they spent. It was just spread out over several days instead of the one day Black Friday event.

If extended hours are in the plan, additional staff might be required. That means time to interview, check references (and do not cut out this step), and train temporary employees. The key is to have enough employees to make each customer feel welcome and appreciated and to give them a pleasant shopping experience.

DIFFICULT RETURNS
No one wants items sold to come back to the store, but returns are a part of doing business. Have a written policy and make sure your employees understand your goal and why each step of the return policy is important. Make returns easy for customers. This first time customer may become a loyal customer after an easy return. Also, there will be the occasional customer who, for whatever reason, is not reasonable. Those must be treated with extra care. Take a deep breath, remain calm and try to work out a solution.

LACK OF WEB SITE OR OUTDATED WEB SITE
Whether or not you have a web site, your business is most likely on the web, in some shape or form. Someone may have posted a review or there may be a picture or other information on a map app. Statistics tell us that 85% of Americans 18 and older are on line. If you are not on line, you are missing customers. The most important information to include on your web site is store name, location, hours of operation (are they changing during the holidays?) and type of merchandise (best to use a picture for this one).

LACK OF SOCIAL MEDIA USE
Your customers are on the web; you need to be there with them. At the least, post pictures of your merchandise as it comes in on your social sites. If your store is supporting a charity, promote the charity. Also, give your posts a title whenever possible. Approximately 70% of retailers use technical product names for social post titles. However, most consumers aren’t searching for product names, rather product attributes like color, style and material (cranberry sweater). When retailers fail to address their social content for these search behaviors, they are missing the customer.

Another use of social media is to tell your stories. Keep it simple. A brief memory of a past shopping trip, a childhood holiday, a special food item, these are memories that build relationships with the readers. Keep your “friends” interested and tell your stories and invite them to share theirs. The idea is to build trust. Customers are more likely to be loyal to those they trust.

An easy post is to snap a couple of pictures of new merchandise as it arrives and post the picture on your social media site. Also, invite your customers to post their pictures to your Facebook or Pinterest site (and to theirs). A picture is worth a thousand words so let pictures of your merchandise speak for you.

DELIVERY OF PURCHASES
Be careful what you promise if you ship items for customers during the holidays. Also, if shipping requires expedited services, be sure those are noted, purchased and taken to the shipper in a timely manner. If the perfect toy arrives December 26 instead of December 24th, it will put a damper on the holiday celebrations for customers and leave them feeling resentful toward all parties. According to ShipMatrix, 70 percent of the fault with late shipments can be assumed by retailers, who the study says often extend "express" deliveries to customers without following through to see that packages are shipped on the speedier services. In other words, the delivery businesses are going to blame the retailers; don’t fall into this trap. No customer is going to feel loyal to a business that just ruined their holiday.

JANUARY
Don’t forget January. It is important to contact your email subscribers, especially the new ones, no later than the end of January. If nothing else, say thank you for their recent visit to your store. Make sure you use their name in the email, i.e. Dear (customer’s name). This is also true of social media; be sure to thank them for stopping by, or to wish them a prosperous new year. Do not wait for months to make a contact. They will have forgotten you by then. This is how you build a relationship—through repeated contact. Generally, people trust those they have a relationship with. This will promote customer loyalty.

Also, January is traditionally the time for a clearance sale. This is the time to get rid leftover Fall/Winter/holiday merchandise. Do not fall into the trap of storing merchandise for another year. “Out with the old and in with the new” is an axiom for a reason—it works! Don’t tie up money in merchandise that may sell eventually with a large markdown. Get your cash from it so your cash flow remains healthy.

Also, make note of what is leftover. How could you have less leftover next year? Research tells us that too many choices equal fewer sales because customers have difficulty making a choice. What items did your customers not like? Were specific sizes, colors, or styles left in large quantities? Learn from these and adjust what you purchase for the next season accordingly.

If you see your business in any of these, it’s not too late to fix the problem. Identity the problem and derive a solution then complete the follow-thru. You can improve and grow your business.

**and here's a response from one of our readers**

I'm glad to see your reference to AMIBA. I founded a 501c3 organization a few years ago that seeks to educate the public on the critical urgency of shopping at local and independently owned businesses over national chains and of course, the internet. For the sake of the local economies in which people live and work and play, it is in everyone's best interest to keep as many dollars circulating locally, and our niche (and the niche you serve) is, hands down, the smartest way to do that, and the most efficacious. We founded the Wyandotte Independent Business Alliance under the umbrella of AMIBA, and I have found them to be extraordinarily well-versed and relentlessly focused on the mission at hand. Their job is to help grass roots organizations such as ours across the nation to flourish, slowing the mad rush away from the very solution that is right in front of our eyes. Every independent that closes accelerates the demise of our national economy, gutting the tax base and micro-economic engines that local economies provide to feed county economies, which feed state's, which feed the macro-economy of the country. It's not theory. It's fact. Our entire national economic model is based on a reality that did not feature the dominance of national chains and internet shopping. As it has shifted over the past 30 years or so, state revenues have declined as has the health of countless small towns that have nearly all seen better days. Not without linkage, there has been a concurrent dramatic shift of wealth and income towards big corporations and extremely wealthy folk. I am not so much a left-wing loony as I am a person who considers the political gamemanship of both parties to be, in part, a smoke screen effort to obscure the reality of increasing wealth at the very top of the food chain at the expense of the economic vitality of the businesses and small towns virtually everywhere. Once focused on, it's very hard to ignore, very hard to continue to behave as if you don't know what's happening. For me, it really is (as much as possible) not just Think Local First, it is Think Local PERIOD. Virtually none of my friends or compatriots see what I see, by the way. Indeed you may find me too shrill and strident. I don't mean to be, I just mean to make clear that this is as urgent an issue as exists anywhere, economically. 

Your advice is always sound and sage in terms of running companies intelligently, avoiding pitfalls and easy to avoid errors that undermine otherwise good companies. I never find fault in the things you talk about, and indeed, it is our responsibility to ensure that we survive and prosper through good, sound business practices. But the truth is, for many of us, despite all good efforts to straighten up and fly right, we find societal trends to be difficult to sway. Just one example: The Today Show features advertorial segments, gushingly advocating buying on-line or at Macy's or Target and any of dozens of entities that undermine our ability to drive local business. (Big Money, advocating the support of Big Money, what a surprise.) Their mission is to get control of ALL the money. We work harder and harder to market more frequently and through all manner of social networking, all to barely achieve a status quo.

You strike me as being detail oriented, researching and being careful before opining. With that in mind, I offer other leads for you to explore (in your spare time!). If you were to share leads and resources with those you serve, you just may strike nerves and foster focus on things that do affect us and that, if addressed, can affect a stemming of the tide. AMIBA is a treasure trove of information and resources like posters and signage and more. In addition:

ILSR.org: The Institute for Local Self Reliance, Features the writings and research of Stacy Mitchell, who wrote "Big Box Swindle", highly recommended reading (the actual catalyst for my own Local First initiatives).

IndependentWeStand.org: Founded by Stihl Power Saws, we met them at an AMIBA conference, at which they divulged that they became what they have become by serving ONLY local and independently owned hardware stores, and would under no circumstances EVER sell the Lowes and Home Depots and Walmarts of the world. This organization advocates in a fabulous way for us mom and pops.

CivicEconomics.com: The source of the myriad bona fide economic studies that verify and publish reports that confirm all I am talking about. Eye opening, elucidating.

If everyone simply puts their head in the sand and doesn't even have an inkling of what has happened to independent vs. national and the effect it has had on the health of the "every man's economy", nothing will happen to stop the tsunami.  So being aware of it and being aware that there ARE organizations out there that do work on our behalf is a start.

Thanks for all you do, Linda.

Peter Rose
THE CHELSEA GROUP, LLC
2944 Biddle Ave.
Wyandotte, MI 48192
T 734-282-7755 / F 734-285-0895
www.chelseamenswear.com
www.facebook.com/chelseamenswear


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