Assortment and environment help drive holiday sales

Christmas is the Super Bowl of retailing. The degree to which you begin now to prepare for Christmas will determine your success—regardless of the bust or boom of the season for everyone else. As with any other strategic issue, I recommend beginning with the end in mind.

Close your eyes for a few minutes and envision what your store will look like during the next Christmas season. How does it look and smell? What sounds surround the customer? What do your stock levels look like? How many employees are available to serve your customers? What items are your customers coming in to look for? All of this and more should be part of your advance planning and can be addressed in the following focus areas:

How can you drive customers into your store? The potential for traffic and sales is such that I recommend you invest 40% of your annual advertising budget in November and December. Be sure you feature some mass-appeal items that will help bring in those who do not normally visit your store. Remember too, that your average transaction will likely grow by 50% or more during these two months, so plan to invest in some special product offers or coupons.

Above all, remember that you are competing for the consumer’s disposable income, so pull out all the stops to get them to shop with you. When it comes to media, don’t rely on catalogs alone. Thanksgiving is the single best time of the year to invest in free-standing newspaper inserts.

What are your customers looking for? More than ever, this season you must be in stock on what your customer expects to find. Plan your purchasing so that the majority of your goods are received by early November. That way your staff will be free to focus on service and selling. Go heavy on best-sellers, new releases and advertised items, and then round out your assortment with other seasonal items—lower-priced impulse items to help increase your average transaction and higher-margin products that can make your profits soar!

As you set your assortments, assess your open floor space and make plans to fill it with free-standing displays, compliments of your suppliers. This is the time of the year when your store should be bursting at the seams. Secure the relevant, high-appeal items in floor displays, clip strips and spinner racks that can help maximize every square inch. Your projected higher sales volumes should provide the inventory budget necessary to make this possible. Be sure to position seasonal items in your highest-traffic locations near the front of the store or on a power aisle for easy shopping.

How can you make the customer’s experience more enjoyable? Taking time to make your store a soothing but seasonally relevant environment will create an atmosphere that compels your customer to linger longer and buy more. Scented pine cones near the front door will greet your customers with a wonderful aroma. Seasonal decorations and point-of-purchase signage in traditional reds and greens are always a winning combination. Top it off with Christmas music such as an instrumental collection that inspires, but does not detract. Having the same available for purchase is a must!

How can you best serve the Christmas shopper? We know how tiring and frustrating it can be to secure just the right gift for every person on our list. Having trained, friendly staff available can set you apart from your competition and make sure no one leaves your store without their needs being met. Begin recruiting seasonal staff in September and starting training them in early November. Analyze your sales from last year—by hour—and take time to create work schedules that ensure you have the right number of staff when you need them and not when you don’t.

What about the 13th month? The holiday season does not end Dec. 24 at 6 p.m. when you close your doors. January can be a significant revenue period if you plan ahead. Again, plan with the end in mind. Develop a life-cycle pricing plan for seasonal goods that includes full MSRP, an early markdown if necessary and then clearance.

One key is to buy items specifically for clearance. You are more apt to become known as a good place to shop in January if you have some great items at great prices rather than a bunch of leftovers no one wants. Seed your clearance selection with items you bought at high discount just for this purpose.

Another key is to estimate what percent of each item you will see at full, marked-down and then clearance pricing. Selling 100% at full retail is ideal, but not practical. It also probably means you did not buy enough and as a result, lost sales. A healthy mix is to see 50% at full retail, 30% at a reduced price and 20% on clearance at 50-75% off. Once you have a plan, monitor sales and move to a marked-down or clearance price based on your sell-through rate. Items that are moving well can wait, but those collecting dust need pricing action right away.

NEXT ISSUE: In the September issue, we’ll look at retail productivity and how to reduce labor costs.

Bill Nielsen is a 25-year Christian retail veteran having served in C-level positions with Family Christian Stores, LifeWay Christian Stores and Berean Christian Stores. Nielsen is now president of The Equation Team, a consulting firm that specializes in retail and publishing.

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