This year's holiday shopping season is starting earlier than ever, with customers beginning their gift search well before the traditional November kick-off. Holiday retail sales are projected to grow 2% from last year, so the outlook for 2024 is cautious optimism.
Although sales are up, inflation continues to affect demand, and consumers are looking for value from trustworthy retailers.
Here's how to make the most of this retail season:
Value-driven strategies that work
In today's price-conscious retail environment, strategic value offerings may attract more customers than deep discounts alone:
- Get ahead of the game: Launch early-bird promotions to capture eager shoppers
- Double down: Create smart bundle deals without sacrificing margins instead of deep discounting
- Leverage e-commerce: Display savings in-store and online
- Play the long game: Consider offering interest-free payment plans for larger purchases
Customer loyalty tips
According to research by Salesforce, loyalty programs are becoming an increasingly important tool for retailers, with 66% of Canadian consumers consolidating their purchases around retailers that offer them.
Consider the following options:
- Start a simple point system if you don't have one.
- Offer "members-only" early access to sales.
- Send personalized offers based on purchase history.
- Give loyal customers extra perks during peak shopping times.
Another way to increase brand loyalty and drive sales is through gift and promo cards, prepaid cards that customers can use toward purchases. These cards often encourage repeat visits. Speak to an ATB business advisor about creating branded gift and promo cards to boost your in-store and online income. They’re quick and easy to implement, with low order quantities, fast delivery, and seamless setup.
Leverage your local advantage
In a 2023 study, the Canadian Federation of Independent Business found that 97% of small retailers contribute to their community or province in at least one way, whether through charitable donation and support, sponsorships or creating job opportunities.
Small businesses are the heartbeat of our communities, and small business retailers can lean into their local community by:
- Implementing in-store pickup for online orders, bringing customers through your door.
- Emphasizing personal service that big retailers can't match.
- Partnering with other small businesses for cross-promotions and collaborations.
- Hosting holiday-themed events to build community connection.
Digital must-dos
- Ensure your website clearly shows your product information and pricing
- Use social media to highlight new arrivals and product promotions
- Consider targeted local Facebook and Instagram ads
- Keep your Google Business profile updated with holiday hours
While today’s customers are price-conscious, they value quality and service. Focus on communicating your unique value proposition rather than competing solely on price with larger retailers. Ensure your marketing highlights your value through quality products, exceptional service, or unique items that can’t be found in larger stores.
Smart holiday inventory strategies
Start by forecasting demand using data from previous years, but remember that 2024 shows some unique trends. With consumer spending patterns shifting and online competition increasing, intelligent inventory management could be a competitive advantage this holiday season. Here are some tips:- Avoid the overstock trap: Don't bulk buy just because there's a discount. Use sales and operations planning to coordinate purchasing with expected demand, keeping in mind shelf life and storage costs.
- Just-in-time inventory for popular items: Stock high-demand seasonal items closer to need, and work closely with suppliers to ensure reliable delivery, including alternate delivery if you have relied on Canada Post due to the postal strike.
- Prevent stockouts: Monitor sales patterns daily during peak periods and set up automatic reorder points for popular items.
- Storage solutions: Organize storage areas by season and demand and consider temporary storage for excess holiday inventory.
- Managing old stock: Create a clear plan for aging inventory ahead of the holiday rush. Consider bundling slow-moving items with popular products.
- It's not over at the holidays: Plan post-holiday clearance strategies.
Technology solutions
Even small retailers can benefit from inventory management software. Free options like Zoho Inventory and Square for retail offer essential features:
- Real-time stock tracking
- Low inventory alerts
- Basic sales analytics
- Cloud access for remote management
Functions like barcode scanning can simplify data entry by using it for check-in, check-out and counting.
The bottom line
The goal for small business retailers isn't zero inventory but the right inventory at the right time. By managing dead stock, preventing stockouts, and addressing storage issues, small retail businesses can create a smoother, more profitable shopping experience while reducing waste and inefficiency.
A line of credit can provide vital working capital, allowing retailers to purchase inventory and cover expenses before holiday sales start rolling in or during an unexpected cash flow crunch. Talk to an ATB business advisor about whether a small business line of credit could be right for your retail operation.
