With holiday shopping expected to grow this year, Small Business Saturday is a great time for small retailers to increase their profits and customer bases.
According to a recent forecast by consulting and financial advising firm Deloitte, US holiday shopping and sales are expected to grow by as much as 4.5 percent in the 2014 season, with purchases expected to total between $981 billion and $986 billion.
The study also found that more consumers are becoming aware of Small Business Saturday. In 2013, consumers who knew about Small Business Saturday spent $5.7 billion with independent merchants that day, which is up 3.6 percent from 2012, according to a survey from American Express.
So, how can you take advantage of Small Business Saturday’s growing success? David Gilbert, CEO of small business lender National Funding, shared five ways small business owners can prepare.
1. Make sure you’re adequately staffed. The holiday shopping season is the busiest time of the year for most retailers. Gilbert advised small business owners to review their projected sales for each of the holiday months and determine whether they will need to hire additional employees. This may not be an option year-round, Gilbert said, but higher sales during the holiday season could make it possible, not to mention a short-term necessity.
2. Lease additional equipment, if necessary. If you anticipate significant increases in sales, you may need more equipment to get you through the season. Determine, in advance, if you need things like additional cash registers, point-of-sale systems or mobile credit card readers, Gilbert said. If you do, rent your equipment with a short-term equipment lease.
3. Stock up on potentially popular items. The last thing you’ll want is to run out of your most popular merchandise before the season is over. That’s why it’s critical to understand your product or service demands during the holiday season, Gilbert said. Plan strategically in advance, he said, and stock up on popular items.
4. Boost your marketing strategy. The holidays are the perfect time to rethink your marketing strategy and increase your advertising plans. Gilbert recommended that business owners take advantage of their increase in sales by using new funds to create a comprehensive marketing campaign that will draw customers to their store.
5. Know your financing options in advance. If you think you might need additional funding to get you through the holiday season, make sure you research your options and don’t wait until the last minute. Because applying for bank loans can be time-intensive and complex, Gilbert suggested that business owners consider alternative lenders during the holidays because of their quick turnaround. Just make sure you let your lender know exactly what you want.
“[Business owners should approach] a lender with their express needs for financing — additional staff, increased marketing and advertising, payroll, inventory, equipment, and such,” Gilbert said. “Any good lender will advise based on those needs, and those needs alone, rather than trying to sell unnecessary products.”