Chain Store Age recently wrote that, “Holiday sales this year will be the weakest in 17 years, according to a forecast issued Wednesday by TNS Retail Forward. It projects that total retail sales in the holiday fourth quarter will increase only 1.5%, making the 2008 holiday season the worst for retailers since 1991, when sales grew 1.2%.”
According to the article, Frank Badillo, a senior economist for TNS Retail Forward, Columbus, Ohio said that non-store and mass retailers will sustain above-average growth while home-goods and soft-goods will continue to suffer, with growth expected to decline versus prior year.
TNS Retail Forward projects that online sales will grow 9% this holiday season compared with 19% in 2007. According to Badillo, the slowdown in online shopping reflects the spreading impact of the economic downturn since the last holiday season, particularly among upper-income shoppers.
THE REAL WORLD RETAILING TAKEAWAY
Increase your customer base to retain your profits.
For the first time in a long time, sales could actually decline versus prior year for the holiday period. If you’re a small retailer in the home goods or soft goods (read: apparel) sector, it’s best you take steps now to manage your business better.
I’ve said most of it before: trim inventory and payroll. But what else can you do?
Sometimes you have to add more services to get more sales.
- Plan in-store events now for the 6 weeks of holiday and publish a calendars. Require your customers to sign up so the events appear exclusive and drive demand to attend.
- Work with vendors to get their experts into your store or have your own in-store expert interact with customers on specific issues.
- Work with vendors to create goodie bags to give away.
- Offer special gift packaging or wrapping. Better yet, pre-wrap quick-selling gifts and arrange them on a table so your customers can just grab and go.
Of course, none of these endeavors will have any impact unless you promote them. And the best way to do that is through your database.
It’s September, and it may seem early. But the big guys have had their holiday plans locked in for 8 months. It’s time for you to create and execute your plan, or you’ll risk being left out in the cold.
How are you going to beat the slow holiday sales prediction?