QuickBooks Shares Three Strategies for Businesses to Optimize Sales Ahead of the Holidays
We know the holidays are a crucial sales period for small businesses. For many, the holidays represent as much as a quarter of a business’s annual sales and revenues; and it’s often one of the best times for obtaining new customers. And while it may be the most wonderful time of the year, this holiday season looks to be particularly challenging for small businesses.
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Inflation is driving up the costs of raw materials and shipping. Some are dealing with excess inventory as consumer demand lags due to economic concerns. Additionally, many small businesses continue to experience supply chain issues and struggle with hiring and retaining staff.
Despite these challenges, recent data from QuickBooks shows that in 2022, more than three-quarters (77%) of American small businesses expect to generate more revenue than they did during the 2021 holiday season. While this significant revenue stream is just around the corner, small businesses still have time to implement strategies to ensure they have a successful holiday sales season. Here are three pieces of advice I recommend to small businesses ahead of the holidays.
Test New Selling Models
The lead-up to the holidays can be a great time to test new sales models to maximize profits. Increasingly, we’re seeing product-based businesses benefit from embracing wholesale opportunities, selling directly to other businesses. This can help businesses reach a much larger customer pool while also benefiting small retailers. In fact, a recent QuickBooks survey found that the majority (68%) of American consumers say they prefer to buy unique holiday gifts from small businesses. Sourcing products from other small businesses is a great way to do this.
We’re also seeing an uptick in direct-to-consumer sales – particularly in industries like beauty and accessories. This represents another opportunity for small businesses, as they’re able to communicate and sell directly to customers without a middleman.
As you’re experimenting, also consider your pricing strategy. Understand where your inventory stands – what do you have an excess of and what are you low on? With this knowledge, you can adjust your pricing and attract customers to the products you want to move the most, understanding many will be particularly price-sensitive this year.
Engage Customers Where They Shop
The holidays are a great time to expand sales channels and meet customers where they are already shopping. This is true for both brick-and-mortar and digital-only small businesses. It is important for small businesses to sell on multiple online platforms beyond just their own websites. This includes Amazon, eBay, and Etsy, in addition to selling via social channels or through virtual shopping events on Facebook, Instagram, and TikTok. The holidays are also a great time to see if there are in-person events that can serve as sales opportunities – like festivals, community pop-ups, and holiday markets. Ultimately, by selling across multiple channels, small businesses have the ability to attract and sell to more new customers – growing their business and bottom line.
Leverage Data to Maximize Impact
An important part of embracing new sales models and channels is understanding how it’s impacting your business. This is where data comes in. Using tools like QuickBooks, which includes e-commerce functionalities, including tracking profitability and top-selling products, small businesses can better understand where the majority of their sales are coming from and which products are the most popular.
Armed with these insights, small businesses can make informed, strategic decisions about how to operate their business. For example, if the data indicates sales are lagging on a specific platform, a business owner can choose to run a promotion to boost performance or choose a different platform altogether. The ability to make these adjustments in real time is invaluable to small businesses, especially during a period as critical as the holidays.
I’d also encourage small businesses to consider running special promotions. Why? Because consumers say it’s one of the best ways to get them to spend more money. Our recent survey also found that most small businesses found promoting these special deals on social media to be the most effective way to inform and entice customers.
The holidays can be a stressful time for small businesses, but they also present an amazing opportunity to capture important sales. Exploring new sales models, meeting customers where they are across a variety of channels, and leveraging data strategically can help business owners make this holiday season the most profitable one yet.
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Shilpa Reddy is Vice President of QuickBooks Commerce at Intuit. She has 20 years of continuous progression and achievement in building new products and businesses from the ground up and leading groundbreaking technology and business transformation initiatives for Fortune 500 companies (Intuit, Microsoft, and Amazon) and startups (Trilogy and Suvision Technologies).
This contribution is part of our Leadership Series, where industry professionals share valuable insights for small business owners selling online. The views expressed are the author’s alone.