Crooner Andy Williams claimed that the Christmas season is “the most wonderful time of the year.” But for some entrepreneurs, the holiday season is anything but wonderful. In fact, the holidays can create some of the most stressful and miserable experiences of the year.
Since November and December are the busiest months for many companies, particularly retailers, anything that goes wrong can greatly affect the bottom line. “Around the holidays it's chaos and mayhem because you’re trying to keep up with everyone else in the world,” says Rick Henningsen, a business owner in Glen Head, New York.
Ho! Ho! No Inventory?!
Making sure enough inventory is stocked and ready to go for the holidays is one of the biggest challenges many business owners face. If that inventory shows up damaged—or not in time for Christmas—it can ruin the year's profits.
During the 2012 holiday season, Henningsen and his wife, Roxana, planned the launch of their new product, the Blizzerator—a uniquely designed snow brush for automobiles. They had already lined up several retailers, including many independent hardware stores, and also planned to sell it on their website.
But the first shipment of about 6,000 Blizzerators didn’t arrive from the Canadian manufacturer until late November, and when it did, the product wasn’t designed to specifications. Parts that were supposed to be made from stainless steel were plastic, and some items were broken. “It was a four-letter word moment; that is the best way I can explain it,” Henningsen says. “We had put so much time, money and investment into [designing the product and making sure it was up to standards] that there was no way that we would allow that product to go out to customers."
The Henningsens ended up refunding money to all the retailers who had preordered Blizzerators for their stores and decided to delay the product launch until fall 2013. They ditched their Canadian manufacturer and found a new one in Indiana. This time around, however, they made sure the product arrived extra early and worked more closely with the manufacturer to make sure the Blizzerators were built precisely as planned. Henningsen says he learned his lesson about getting ready for the holiday season and having all your ducks in a row at least a few months early, adding, “We lost a whole season and tens of thousands of dollars in advertising.”
For online retailers, the holidays can be just as crucial. Any problems with a website in the days leading up to Christmas can spoil the entire season.
Uncorked Ventures, a San Mateo, California-based online wine club, had such a scare in 2010. Three days before Thanksgiving, the company got an email from Google Webmaster Tools saying its website was being removed from Google’s search engine index because it didn’t meet Google guidelines. That meant the company’s website wouldn’t show up in the search engine results for people searching Google for wine around the holidays—even if they typed “Uncorked Ventures” into the Google search box. “It felt like the end of the world,” says company co-founder Mark Aselstine. “We do 50 percent of our business over the holidays.”
The company quickly contacted its e-commerce software provider and discovered that hackers had posted links to Viagra and other pharmaceutical drugs on about 250 of the site’s almost 500 pages, causing Google to block the site. The problem, the email software provider said, was due to an outdated email client that was vulnerable to hackers.
Thankfully, Uncorked Ventures got a holiday miracle: The software provider was able to remove the spam links quickly and Google restored the site by Black Friday morning. “We were very lucky that this all transpired before Thanksgiving, and not after,” Aseltine says.
Santa's Empty Sleigh
Many entrepreneurs rely on the U.S. Postal Service, UPS, FedEx and other delivery services and shippers to make sure their orders get from place to place on time. But sometimes that doesn’t pan out so well.
Chike Uzoka, founder and CEO of Valentine Global, a Newark, New Jersey, company that trains entrepreneurs, knows the pains of holiday season shipment errors firsthand. A week before Christmas last year, Uzoka attended a conference in Atlanta and shipped 50 copies of his book, A Young Man’s Guide to Entrepreneurship: 16 Things You Need to Know, that he hoped to promote and sell as a holiday gift item. But when he got to the shipping company’s office in Atlanta, they couldn’t find the package. “They said it was in the building somewhere but no one could find it,” Uzoka says. “It was very busy because of the holidays and everyone was just trying to get up to the register. So I don’t think finding it was a very high priority for them.”
He ended up attending the conference without his books and estimates he lost anywhere from $300 to $500 in potential sales due to the missing shipment. “They called me the next day to tell me they found the box,” Uzoka adds, saying they refused to give him any sort of refund. “By that time I was so upset, I didn’t want to talk about it anymore.”
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