The holiday season accounts for 20% of the retail industry’s annual sales. It’s often responsible for up to 30% of some individual retailer’s sale. Based on 2016 ecommerce statistics, gift cards are the most desired holiday gifts. The biggest days of sales for retailers and ecommerce businesses are on the 22nd and 23rd of December. According to the National Retail Federation (NRF), holiday sales are projected to increase 3.6% – 4% for a total of $678.75 billion to $682 billion in 2017. This is up from $655.8 billion in 2016.
Since holidays are such an important time of year that you can’t do without smart inventory and merchandising planning. Calculate how much stock you have and you’ll need. Don’t be late on placing your orders. Build a stock replenishment plan by setting re-order points (ROPs) and transferring stock between locations. Sell your overstock for the right price and turn returns into opportunities.
Inventory Planning Tips for the Holidays
Below you can find useful holiday inventory planning tips that can help you get organized for the big season rush.
- Get the Right Working Capital
Often, you need to spend money on making money. If you lack the necessary funds, consider applying to a reputable business funding provider like First American Merchant for business funding. FAM is an award-winning alternative online lender and payment processor that specializes in the high risk sector and has an A+ rating with the BBB. Unlike bank loans, loans from respectable alternative lenders don’t take longer periods to process, are more flexible and offer easy approval.
- Identify Your Winning Items
Remove all unpopular items from your shelves before the season starts. Consider discounting these items more significantly.
- Avoid Excess Inventory at the End of the Month
Have enough of your best items in stock for your customers but not more. Avoid post-season markdowns as they can decrease your profits.
- Plan Your Purchases
For each product you’re going to sell during the holidays, you should get a delivery date from the vendor. This also refers to quantities you’ll receive by the delivery date. Clearly communicate your specific holiday inventory needs to everyone you’re buying from. Find out if there’re substitute items if something isn’t available.
- Work with the Right Vendors
Don’t work with vendors who are making late delivers and fail to meet your specific business needs. Timing is of immense importance for retail sales.
- Don’t Forget About Gift Cards and Redemptions
If you plan your inventory carefully, you’ll be able to reduce the amount of items you’ll need to mark down in January. Also, this will prevent gift cards from being used for buying clearance items.
- Offer “Special Gifts”
Have at least a few unique or unusual items that your customers aren’t likely to find elsewhere. This will help you attract more customers.
- Set Up a Holiday Marketing Plan
A holiday marketing plan is crucial to your success. This can be based on the following categories – online marketing, print advertising, and events.
During the holiday season, retailers often struggle with the increased yet unpredictable demand. For over half of small businesses, inventory management is the biggest worry for the holiday season. Use smart inventory management tips to avoid costly stock-outs and overages.