Four steps to make this shopping season a holiday

The extended holiday season – from Black Friday through to Boxing Day and beyond – is brimming with sales opportunities. But in reality, shoppers are increasingly using peak sales periods to shop around for the lowest prices, writes Jason Toshack, VP and GM, Oracle NetSuite ANZ.

How do retailers maintain profit margins whilst still being part of the action?

With careful preparation and the right tools in place, retailers can maximise the holiday shopping season and start the new year strong.

4 tips to make the most of this holiday season

Plan ahead to drive better business outcomes

As the saying suggests – struggling businesses don’t plan to fail; they fail to plan. It’s therefore imperative to put the right plans in place ahead of the holiday shopping season to ensure success.

Reviewing shopping data from previous holiday sales, as well as current purchasing trends, can help anticipate what products will be in greatest demand. This will help businesses to source and ship the right type and amount of inventory in time for the sales without having excess stock left in warehouses.

The data will also help identify the optimal pricing strategy to ensure as many customers as possible are captured without straining margins.

Of course, the same principles can be applied year-round, and making sure the stock levels are consistent will ensure the business is prepared for busy sales periods – without wasting money on storage or ‘dead’ stock.

Streamline operations with automation

A great plan is the first step, but execution is the key to truly succeeding. Businesses are still facing a range of external challenges, from supply chain disruption to rising inflation and input costs.

This means businesses looking to maximise shopping periods must identify what is crucial to maintaining the appropriate level of customer experience and streamline where possible. Processes that worked for the business even three to five years ago may no longer be applicable today. It’s time to review processes and cost centres and consider whether there is a more efficient way to do something.

For many retailers, the holiday season usually means a big hiring drive with all hands on deck. But amidst a shortage of workers in Australia, businesses will have to be more resourceful. Using technology to automate repetitive or mundane tasks – or even simply those that don’t require the high level of personal touch offered by a human worker – frees up your team’s time to work on higher-value activities.

In addition to improving overall productivity, having staff focus on more interesting or complex tasks goes a long way to keeping them engaged and in the business.

Monitor finances to optimise pricing

Leaders should stay on top of key financial metrics to have an up-to-date picture of how the business – and which products – are performing. Aside from the need to have a clear picture of free cash flow in the business to remain liquid, keeping track of demand for certain products can help leaders adjust pricing on the fly to capture as much margin as possible.

For example, if you see a certain product flying off the shelf, it may be priced too low. Alternatively, if something is not moving at all, consumers are telling you that it likely doesn’t represent good value. In both instances, adjusting your pricing in line with these indicators will help to maximise margin, better manage storage space, and ensure the business is investing in the right products.

Create new opportunities to add value

Retailers should look to maximise sales during shopping holidays when consumer demand is strong. Equip teams with the confidence to upsell or cross-sell relevant products to complement discounted or popular items. Upgrading customers to a higher-value product or service, or selling complementary products or services to the same customer, adds value to every sale. These value-add tactics create additional revenue that can serve as a financial buffer during slower sales periods.

It’s also beneficial for businesses to regularly promote the specials they have available. Retailers should augment their in-store selling opportunities with personalised online offers distributed to their customer databases, which can be done at scale using an effective customer relationship management system.

Tying it all together

Shopping holidays can be extremely competitive for retailers selling to price-sensitive consumers, who have typically done plenty of research on where to find the best deals. While this can seem like a challenge, it’s one that can be overcome with some solid planning.

In addition, with good execution, a grip on finances, and the insights to create new opportunities of the existing demand, retailers can make the most of the period of madness and at the same time set themselves up for future success.

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