Stocking seasonal items can be a dilemma for small business owners. On one hand, these products can be a draw for shoppers, especially around the winter holidays. But on the other hand, it can be risky to invest in inventory that might not be popular with customers, and then lose money on it at the end of the season if you have to drastically reduce the price just to get rid of it.
Here are some factors to consider when selecting seasonal products for your store, and tips for making sure they sell out.
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Look at your sales history.
If you’ve been in business for some time, then consult data from past years. How did your seasonal items perform, sales-wise? Were there certain items that customers were clamoring for, and others that were on clearance by season’s end? Let your own past performance be your guide, informing your decisions as to whether to buy more of one item and less of another, and skip some poor performers altogether.
Stocking sought-after seasonal products doesn’t just happen by accident. You have to pay attention to what’s trending both industrywide and locally. That, combined with what you know your customers like, should help you narrow your focus when it comes to choosing which products to stock.
Stay on brand.
The season’s so-called hottest products aren’t so hot if your customer base isn’t interested in buying them. Stick with items that feel true to your company’s identity, and make sure that they’re products that your customers would actually purchase.
For example, if you run a women’s clothing boutique, giftable items like holiday mugs or pajamas make sense during the winter, but children’s toys or holiday cookware doesn’t make as much sense. You don’t want customers to look around your store and say, “Huh?”
If this is your first time stocking seasonal products — whether it’s for the winter holidays or summer vacation season — it’s wise to be cautious instead of going all in on seasonal products. Once you determine which products you’re going to carry, keep in mind that a modest inventory of seasonal products can also work to the advantage of any retailer.
In fact, researchers at Northwestern University’s Kellogg School of Management found that “retailers could increase their profits by inducing scarcity to convert some late-season price-sensitive buyers to early season buyers.” They did this by slightly reducing their inventory, which created a sense of urgency for shoppers to buy earlier in the season.
Reduce prices a little now, instead of a lot later.
Think about running a smaller sale throughout the season instead of giving big discounts on major sale days.
Pre-holiday sales have become the norm across the retail landscape, and while they used to kick off in earnest on Black Friday, the discounts are now beginning earlier each year. By starting the sale earlier, you “give your business time to isolate developing trends in the run-up to more high-volume shopping toward the end of the year,” according to Forbes.
As for pricing, the Kellogg School of Management research found that “the retailer was better off offering smaller markdowns earlier in the season rather than large markdowns late in the season.” So, the lesson is to incentivize buyers to make purchases when the products are timely instead of practically giving away seasonal merchandise later.
Launch a marketing campaign.
Once you’ve decided on the seasonal merchandise you’re going to offer, create a plan to advertise the products to your audience.
An email marketing campaign allows you to reach your customer base and let them know about the new items you have in store, and inform them of any discounts. If you want to reach new customers, think about how to showcase your seasonal buys on social media.
You can use email or social media to let people know that there’s a limited quantity of certain seasonal items, creating a sense of urgency and prompting shoppers to act fast.