And here is a “simple but not easy” number: According to the National Retail Federation, retailers typically make between 20 to 40 percent of their annual sales during the holidays. This means the pressure is on to make each tool at your disposal count when squeezing every dollar out of every sale.
Negen has 20 years of independent retail experience, where he turned a love of kites (of all things!) into a multi-million dollar operation. He speaks frequently to retailing groups, including gatherings at NAMM trade shows, and he knows the good, the bad, and the ugly of holiday retailing. I recently caught up with him and shook him down for a list of the top Do’s and Don’ts for retailers that can lead to a more successful December.
DO Review Last Year’s Numbers
We have short memories, so don’t just think you remember what was hot last year. Go back and review your sales records and be sure of what was hot. “Just spend 30 minutes looking and you’ll likely see trends you’ve forgotten about, and also discover products you remember doing better than they actually did.”
DO Invest in Experienced Salespeople
“When it comes to having extra people on the sales floor for the holidays, don’t think any warm body is better than nothing because it’s not,” he says. That untrained, unmotivated person with a lack of knowledge could give the illusion that you’re not prepared and actually end up doing more harm than good.
DON’T Wait Too Long to Hire Seasonal Help
Negen advises to hire early and train that hire “as much as humanly possible.” Get them in early so they can learn to quantify and close the sale.
Also make sure those earnest temps understand your business. “You want them to be clear about things like return policies and warranties,” Negen says. “Get them up to speed and make sure they know that if a customer asks a question they can’t answer, they should get another associate for that answer. God forbid a customer asks your holiday worker something and he or she just makes up an answer – and believe me, I’ve seen that happen!”
DO Ask the Questions that Lead to the ‘Perfect’ Purchase
Rushed salespeople leave money on the table, and don’t ask all the right questions. Have a sales team that, in addition to the training, has the time to quantify the sale, and not just make sure the customer gets the right instrument, but also the right accessories.
DON’T Hang On to Holiday Merchandise for Too Long
You know that ukulele shaped like a Christmas tree or that Santa statue that sings “Dreidel, Dreidel, Dreidel?” Negen says to identify the dogs early and mark them down as soon as you see they aren’t selling. “It’s easier to sell a holiday item at 20 percent off during the second week of December than 75 percent off in January,” he says.
While we’re at it… “Don’t you dare put holiday merchandise in storage,” Negen says. “Your store is not a museum, and if something didn’t sell this year, what makes you think it will sell next year?”
There’s math that justifies such discipline. The carrying cost is real, as that $10 item takes up space for 12 months, which could be used for another $10 item that turns four times in the same period. “You would have brought in $40 in place of that $10 – so get rid of it and reinvest in things you can sell.”
DO Extend Holiday Hours
“It drives me crazy because it’s so obvious to me, but every independent retailer should keep the same hours as the mall during the holidays, including being open on Sundays. I’m telling you: people are shopping to the last minute. When I go to one of those smaller downtown shopping areas at 7 p.m. and half the stores are closed, I shake my head. Sometimes someone hits a store at 8:30 and spends $2,000. You can’t sell through a closed door.”
DON’T Be Without a Loyalty Program
“I recommend this to all whenever they can implement it, but it’s especially effective during the holidays,” he says. First and foremost, it gives you an easy reason to get a customer’s email address and contact information. “Also it allows you to turn that holiday sale and parlay it into creating year-round traffic.”
DO Create Special Promotions
“Retailers sometimes don’t want to do promotions during the holiday, and I think that’s a mistake,” Negen says. Having a guitar-playing Santa that customers can get their picture taken with was one idea he came up with on the spot as an example of out-of-the-box thinking.
“But don’t make all your holiday promotions just about sales and low prices.” If all you’re doing is pushing price, it’s “game over.” Maybe, on Tuesday nights, your store could have the local high school jazz band play holiday classics. Have another concert that appeals to seniors. Create opportunities where you can talk to customers and build relationships.
DON’T Forget the Postmortem
Negen advocates that after the last bit of tinsel has been swept up, sit down with your team and have an in-depth discussion analyzing what worked, what sold, what didn’t, and take detailed notes. “It doesn’t have to be a big fancy report, just write it down,” he says. “Even look at the promotions that did well and ask how they could have been even better. If someone on the team says she feels like you didn’t have enough people working the floor on Saturdays, make a note of that.” Have the meeting end with good ideas about what to do next holiday season, and be clear on what you’re going to stock.
Negen’s bonus Number 10?
“Go get ‘em!”
